House of Commons
Wednesday 3 March 2010
The House met at half-past Eleven o’clock
[Mr. Speaker in the Chair]
Oral Answers to Questions
The Secretary of State was asked—
My hon. Friends the Minister of State and the Under-Secretary have both recently met Malaria No More to discuss the control of malaria in developing countries, and I regularly meet members of the Bond NGO network, which includes health and malaria-focused NGOs.
The whole House will want to celebrate the truly remarkable work of the Bill and Melinda Gates Foundation, which will undoubtedly save millions of lives in the coming years. What steps are the Government taking to work closely with Mr. Gates and his foundation to maximise the effectiveness of its vital fight against malaria?
I entirely concur with the sentiments expressed in the hon. Gentleman’s question. I had the opportunity to meet Bill Gates just two or three weeks ago at Davos, when I congratulated him on the extraordinary work that the foundation is undertaking, which I thanked him for on behalf of the people of the United Kingdom. We are working very closely with the foundation, and we welcome the fact that its new office for Europe has been opened here in London. That is a reflection of the strong and strengthening work we are undertaking not only on malaria, but on a number of other diseases as well.
Given both that the Global Fund to Fight AIDS, Tuberculosis and Malaria is facing a shortfall and that there will be an international conference on replenishment next October, will my right hon. Friend encourage the entire international community to make the highest possible contribution in order to save even more lives?
I pay due respect to the expertise that my right hon. Friend brings to this issue. For many years he has been a tireless advocate for the cause of tackling these preventable diseases. The global fund is undertaking important work, but it faces an international shortfall. In response to the last replenishment round, we were able to make an unprecedented commitment of £1 billion over seven years, reflecting the fact that we need to build up the sustainability of the treatments for these diseases across the developing world. I hope that in the coming replenishment round other countries will feel able to match the long-term commitments that we made in the last one.
For a number of other diseases and health issues, the Department for International Development has produced a strategic plan with detailed input from experts and civil society. Does the Secretary of State not think that we should do the same for malaria, and will he now bring the same level of attention and rigour as the Gates foundation to tackling this entirely preventable and treatable disease?
I assure the hon. Gentleman that we are working in close partnership with a wide range of organisations, including multilateral bodies such as the World Health Organisation, the Roll Back Malaria coalition, UNITAID and the Global Fund to Fight AIDS, Tuberculosis and Malaria, which we have just discussed. I assure the hon. Gentleman that that partnership approach informs our work.
Given that the WHO estimates that almost half the world’s population is at risk from malaria, and following the Secretary of State’s earlier comments, will he inform the House what steps his Department is taking on the development and roll-out of a vaccine against malaria?
I can give the assurance the hon. Gentleman is seeking. We are funding research, and we are also looking at the affordability of treatments, which is key. There is certainly common ground between us in recognising the scale of the challenge we are facing. It is estimated that almost 250 million people around the world fall severely ill with malaria each year. Almost 1 million die, mostly children, and one in five child deaths in sub-Saharan Africa is still from malaria, despite the fact that in many cases treatments are available, such as malarial-treated bed nets.
Will my right hon. Friend be partnering some of the drug companies, which hold an important key in respect of speedily rolling out anti-malarial vaccines to the population? This is not rocket science. There are some cheap vaccines out there, and the drug companies ought to be playing a fuller role than they are at present.
We are working with drug companies, first, on the affordability of medicines and, secondly, on research into vaccines. In both areas, it is vital that the private sector plays its role in making sure that we provide affordable, effective treatments for this terrible disease.
Of course the international community has to work to achieve the eradication of this disease for which many cures are available—such as something as simple as ensuring that a family sleeps under a malarial-treated bed net. That is why the White Paper my Department published last July supports the delivery of 10 million more bed nets each year from 2010 to 2013. We estimate that this alone will help to prevent 165,000 child deaths from malaria.
Including humanitarian aid allocated in response to the earthquake in Sichuan—which registered 8 on the Richter scale, killed 70,000 people, and left 300,000 people injured and millions homeless—DFID has spent, on average, £34.5 million a year over the past five years in China.
We want the very poorest people in China to escape poverty, but given that China’s gross domestic product per head is $5,300, that China has growth of 8 per cent. and that it is a world superpower, would it not be a more effective use of British aid to target it on the very poorest people in the weakest economies?
The football analogy would be that on a per capita basis China is languishing somewhere near the bottom of the Football League, whereas on a global level it is indeed at the top of the premier league. It is important to recognise that 200 million people in China still live on less than $1.25 a day and that 450 million people live on less than $2 a day. That is why it is important to have a sustainable partnership and a dialogue with the Chinese authorities and to work alongside them in tackling the type of poverty that the hon. Gentleman has just described.
Although I accept that targeting the poorest in the world and working with countries such as China is a difficult balance to strike, what assessment does the Minister make of the human rights record of such countries in ensuring that the moneys given get to the very poorest in places such as China, India and other parts of Asia?
We regularly discuss with the Chinese authorities their obligations to meet international laws on human rights and freedom of speech. In order to deal with the very poorest people living in China, it is important that we have a dialogue with the Chinese authorities and that, through the work that was recognised by the International Development Committee, we engage in pilot studies. If the progress is seen to be effective, the schemes can then be rolled out on a massive scale in countries as big as China.
As a member of the Committee at the time of some of those pilots, especially the child-centred education projects and other such schemes, may I ask what constant monitoring the Department is undertaking to ensure that the lessons learned really are being rolled out? There were some very good schemes on the ground, but is the Department assessing their impact, beyond the money that it is spending, in leveraging in more work by the Chinese?
It is very much in our interest and that of China that the lessons learned from engagement with such development projects are rolled out, and the evidence on the ground suggests that that is happening. Indeed, in one of the meetings that I had during my visit to China last year, one of my colleagues from the World Bank remarked that they immediately recognised a school that the Department had been working with just by the layout of the classrooms—they could tell immediately that DFID’s engagement and positive role had had a part to play.
China has just spent £20 billion hosting the Olympics and has foreign exchange reserves of more than $2 trillion, yet DFID aid to China has increased in each of the years since 2005. The figure that the Minister failed to give us is that £188 million of taxpayers’ money has been spent on aid to China since 2004-05. Does he not understand that giving aid to China, and indeed to Russia, is in danger of bringing into disrepute this vital budget, which we are all pledged to protect?
Interestingly, in 1997 the overseas development spend in China was four times higher than it is now. I also point out to the hon. Gentleman that we announced in May 2006 that we are ending the China programme in 2011. Using language that may well play to a gallery at a party conference may win him some applause—and it may protect his position in the shadow Cabinet—but it certainly does not show leadership on development issues.
Violence Against Women (Developing Countries)
We are supporting and funding a series of initiatives internationally, through our country programmes and non-governmental organisations, to prevent violence against women, and to protect and help victims of such violence in, for example, Pakistan, Afghanistan, Nepal, the Democratic Republic of the Congo and Uganda.
My hon. Friend is right to make the point that civil society has a critical role to play, both in helping to provide support to the victims of such violence and in advocating new laws and better support by Governments in developing countries. One particular example of the work that we fund through civil society groups is that of the International Rescue Committee in Sierra Leone. Its work has helped to support the development of new legislation and a range of new services to provide new support for women and child victims of a range of sexual offences.
Will the Minister acknowledge that eastern Congo probably witnesses the most savage and brutal attacks and rapes on women anywhere on the planet? As the United Kingdom is a major donor in the DRC, what does he think we can do to lead action to give the women of DRC the right to life and the right to equality in life that they are denied at present?
The right hon. Gentleman is absolutely right to highlight the eastern DRC as a particularly appalling example of the scale of violence against women. We can provide direct support, as we are, to help women to come forward to report examples of rape and other sexual crimes. We can also provide support to train the police to deal with such violence, which we are doing. In the end, there has to be the political will in the DRC for the issue to be tackled, which is why my right hon. Friend the Secretary of State and others have raised it at the highest level with President Kabila and his Ministers.
My hon. Friend will know, as he has a long-standing interest in Nigeria, that we work in a series of northern states in particular, where we are to trying to encourage more girls into school. We are obviously working with the authorities at a federal and state level in Nigeria. In that way, we are trying to help to improve the situation of girls and women more generally in Nigeria.
Is not the most effective way of tackling violence against women, strangely enough, to ensure that more girls get into education? Can we not make better progress over the next few years towards millennium development goal 3? Does the Minister share my disappointment that, despite many resources being poured in, we are still lagging some way behind our targets for that goal?
Of course we want to see much more progress in the prevention of violence against women and to see more girls getting into school. We have made significant progress in increasing the number of girls in school. One reason why we are pledged to increase our spending on international development is to fund more education programmes and to get more girls into school.
If we are to tackle violence against women and many of the other issues wrapped up in the achievement of the millennium development goal, the international community will have substantially to raise its game. In that context, the UN women’s agency is very important. Having supported the creation of the agency, which we welcome, the Government are now, it is reported, seeking to limit its operational capacity to something of a co-ordinating role. Will he reassure us that that is not the case and that we will see that agency given the resources and tools to do the job?
We have long advocated a powerful new women’s agency that brings the parts of the UN system that already work on this issue together under strong new leadership with better resourcing. The agency can play an important role and bring together more players in the UN system to do more work on tackling violence against women, in particular, and on a series of issues on gender equality.
The Minister of State, officials from my Department and I are all taking part in a number of events and awareness-raising efforts through Fairtrade fortnight. Our participation is testament to the value that we place on Fairtrade’s contribution to development and to reducing poverty. That is, of course, underpinned by our White Paper commitment of £12 million to expand Fairtrade globally, so that we can double the number of producers who benefit directly.
On this side of the House, we are enthusiastic about the achievements and potential of the Fairtrade movement, which allows British consumers to send a voluntary signal through the market about the conditions in which they want their goods to be produced. Will the Secretary of State join me in congratulating British brands that have moved towards Fairtrade in recent years?
I am happy to do so. One reason for the almost explosive growth in Fairtrade in recent years is that major retailers—started, I am proud to say by the co-operative movement, and including brands such as Morrisons, Sainsbury’s and Marks and Spencer—have made Fairtrade products available in many large stores and supermarkets. Of course, I pay tribute to organisations such as Traidcraft that have flown the flag for Fairtrade for many years, but if we want the growth of Fairtrade products to continue, it is vital that those major brands continue to support them.
Existing trade rules often prevent producers in the developing world from lifting themselves out of poverty. Does the Minister agree that now, more than ever, is the time to champion a free, open and fair trading system, and will he do all he can to end the deadlock in the Doha round of trade talks?
I hope that I can give the hon. Gentleman the assurance that he seeks. Only tomorrow, I will be meeting Pascal Lamy, the director general of the World Trade Organisation, to discuss how we can continue to make progress towards achieving the fairer trade rules that were promised by the global community, and anticipated back in 2001, but that, alas, have not yet reached a conclusion.
For years, Cath Greenlees of Longton in my constituency has organised Fairtrade stalls at community events across South Ribble. Indeed, she met my right hon. Friend when he visited my constituency recently. Will he join me in paying tribute to the hundreds and thousands of Fairtrade activists who do so much work to promote that cause?
I am unyielding in my admiration of the work that I saw for myself in South Ribble and of my hon. Friend, who has been a tireless campaigner for Fairtrade for many years in the House. His comments reflect a sentiment that is shared on both sides of the House—that we should applaud and pay due respect to those people who have advocated Fairtrade for many years and who are now directly benefiting many millions of producers across the developing world.
May I agree with my right hon. Friend that it is a tribute to the people of these islands that such a high volume of Fairtrade products are now going through our major retailers, including the supermarkets? Will he take this opportunity to pay tribute to the pioneers, who are still needed in the independent third-sector outlets, who keep the flame burning and who keep pushing forward the case for Fairtrade in this country?
Of course, I am happy to do so. I am something of a long marcher when it comes to Fairtrade produce—I remember when Campaign Coffee tasted nothing like coffee. In that sense, the success of the pioneers is now being seen in major multiples across the country. Were it not for the powerful voice of campaigners, advocates and consumers, we would not have seen the shift in recent years by the major supermarkets, so I am happy to pay tribute to those people.
I am sure that the whole House will acknowledge the success of Fairtrade fortnight. The Secretary of State has highlighted the fact that his Department will spend £12 million on Fairtrade and helping farmers to work their way out of poverty, but how will that money be spent and how will he evaluate its impact and effectiveness?
For all our expenditure, we consider both impact and effectiveness. The principal challenge that we have directed that money towards is both international and domestic. Domestically, we want to increase the range of products available that have the Fairtrade mark and the range of retailers that stock Fairtrade products. At the same time, we want to sustain the kind of growth that we have seen even in the teeth of recession—there has been a 12 per cent. rise in Fairtrade sales in the past year. We also want to replicate internationally the success that we have enjoyed in the UK. If we were to achieve nothing more than the replication of that success, it would transform the lives of farmers and communities across the developing world.
Women's Education (Sub-Saharan Africa)
The UK is committed to increasing aid for education in sub-Saharan Africa to help to ensure that all girls, as well as boys, benefit from good quality basic education. The numbers of girls enrolling in schools in sub-Saharan Africa increased by some £21 million between 1999 and 2007. That was in no small part due to the support provided by the UK.
I agree with my hon. Friend that education is one very powerful route to helping developing countries and their citizens lift themselves out of poverty. We have made a series of commitments in terms of the financial resources that we will commit for education, particularly in Africa, to which we expect to adhere. We are also looking at what else we can do to work with developing country Governments to improve the quality of education, to increase the number of teachers and to improve the learning experience for the students in the schools.
Does the Minister accept that too many children all over Africa are still left out of school? That happens not because too little funding goes into general education, but because they cannot afford the school uniforms and the basic pens and pencils that are a prerequisite for being included in a school.
I accept that a huge challenge still faces a series of countries and their citizens when it comes to getting children into school. In Zimbabwe, for example, children still have to pay user fees to go to school, even though our assistance is providing support. That is one reason why we are determined to protect the international development budget, going forward. It is a pity that 96 per cent. of Tory candidates do not share our commitment to that aim. [Interruption.]
The Government are on track to spend 0.7 per cent. of gross national income on official development assistance by 2013. The official estimate of the final 2009 ODA:GNI ratio will be released as a UK national statistic on 1 April. We have recently announced plans to enshrine this commitment in legislation to keep our promises to the world’s poorest people and deliver on our Gleneagles commitment, going forward.
I thank my right hon. Friend for that answer, and commend the Government on their continued commitment to the target of devoting 0.7 of GNI to international development. Is my hon. Friend as impressed as me by the communities in my constituency of Linlithgow and East Falkirk? Despite being in a recession, people there are saying to me again and again that we must stand by our commitment to that target and also try and export it to other countries. While we are suffering, others in the world are suffering much more.
I am happy to congratulate the communities of Linlithgow and East Falkirk today on their enduring commitment to the task of tackling global poverty. The recession has impacted on livelihoods in both west central and east central Scotland, and across the UK, but it is affecting the lives of many millions of citizens across the developing world.
We have made it clear that new and additional financing will be available from 2013, the period when we were anticipating a conclusion to the Copenhagen negotiations. Indeed, we will limit the contribution of overseas development assistance from 2013 to up to 10 per cent. of the UK’s ODA budget. Alas, that commitment has not been matched by the Opposition. I hope that the hon. Gentleman will now campaign for such a commitment to be made.
This year, around 2 million people will receive food aid, compared with more than 7 million last year. While the situation has therefore improved, a poor harvest could substantially increase the numbers of people in need.
Is the Minister convinced that the global political agreement in Zimbabwe is working? Gertrude Hambira, the leader of the General Agricultural and Plantation Workers Union of Zimbabwe, has had to flee to South Africa in fear of her life, because the police have raided her office three times in seven days. Is that a sign that the humanitarian situation in that country is improving?
The hon. Gentleman cuts right to the heart of the challenges in respect of the global political agreement and the workings of the inclusive Government. He is right to highlight the fact that the inclusive Government have yet to achieve a series of political milestones, but we must recognise that Zimbabwe’s economic situation has certainly stabilised and improved, which has undoubtedly contributed to the improving humanitarian situation there. As I have said, we continue to watch the country very carefully, as a considerable number of people still require food aid and a poor harvest has the potential to exacerbate the problems that still exist.
The International Development Committee recently managed to visit Zimbabwe, where it met some women who had reclaimed land that had been destroyed. Those women are growing things on that land again, under a new system of collective agriculture. Can DFID’s pioneering work in introducing new methods of agriculture at a local level be used elsewhere in Africa to demonstrate again that the Department is a top practitioner in tackling poverty?
I thank my right hon. Friend for his comments about our work on agriculture in Zimbabwe. There is a still a considerable amount that we need to ensure happens in Zimbabwe, but we certainly hope that the lessons that have contributed to the successes that he, like other members of the Select Committee, saw at first hand will be replicated in other country programmes with which we are obviously working.
The United Kingdom remains strongly committed to tackling malaria. That was why the Prime Minister committed in 2008 to providing more than 20 million bed nets by the end of 2010 and to helping to prevent 110,00 child deaths. Our 2009 White Paper committed to providing an additional 10 million bed nets each year to 2013.
Will the Minister take the opportunity to study the report—endorsed by Margaret Chan, the head of the WHO—by the all-party group on malaria and neglected tropical diseases that was given to his office last week? It includes recommendations that would cut short the process of getting to the strategic plan on malaria which my hon. Friend the Member for Sutton Coldfield (Mr. Mitchell) urged the Department to adopt and which I would support.
I have indeed read the report to which the hon. Gentleman refers, and I congratulate him on his work as chairman of the group. Let me tell the House what he wrote in his foreword to the document:
“The highlights of this report are easily summarised…We’re making progress in malaria control at a faster rate than ever before...We have good tools which can prevent and treat malaria…Political will is strong and funding is better than ever before.”
The Prime Minister was asked—
I have been asked to reply. My right hon. Friend the Prime Minister is in attendance on Her Majesty the Queen welcoming President Zuma on his state visit to the United Kingdom.
I am sure that the House will wish to join me in paying tribute to the five British soldiers who have died in Afghanistan: Senior Aircraftman Luke Southgate from 2 Squadron, Royal Air Force Regiment; Rifleman Martin Kinggett from 4th Battalion The Rifles, attached to 3rd Battalion The Rifles; Sergeant Paul Fox from 28 Engineer Regiment, Royal Engineers, attached to the Brigade Reconnaissance Force; Rifleman Carlo Apolis from 4th Battalion The Rifles, attached to 3rd Battalion The Rifles; and the soldier from 3rd Battalion The Rifles who died yesterday. They demonstrated outstanding courage and skill, and they died serving their country, their comrades and the people of Afghanistan. Our thoughts are with their families and their loved ones; their sacrifice will not be forgotten.
I am sure that the whole House will also join me in sending our sincere condolences to the people of Chile following the terrible earthquake at the weekend.
The whole House will wish to join the right hon. and learned Lady in paying tribute to those brave men who have given their lives for our freedom, and of course in what she said about the people of Chile.
Will the right hon. and learned Lady please tell the House why manufacturing has declined faster under this Labour Government than under any other Administration ever?
Indeed, this is just typical of the Conservatives talking the country down. British manufacturing is strong and it has a great future, especially with advanced manufacturing and that supporting the digital and creative industries. The Conservatives constantly describe Britain as heading towards an age of austerity. We do not share that pessimism; we are optimistic for Britain’s future, including in manufacturing.
AstraZeneca in my constituency has decided to relocate its research and development facilities to Cheshire, which will cause 1,200 jobs to be lost to the local economy in 2011. Overall, pharmaceuticals are strong in the United Kingdom, and the Office for Life Sciences has ensured that many such jobs remain in the UK. However, that is no consolation to the 1,200 people who will have to relocate from my constituency, so will my right hon. and learned Friend assure me that the Government will give every assistance to the taskforce that we will set up this week to address the situation and ensure that there is economic and development help for the constituency of Loughborough and the people who will be affected?
I can give my hon. Friend that assurance. We do not believe in standing by, letting people fend for themselves, letting recession take it course, or that unemployment is a price worth paying. We have an active interventionist policy to support industry, including in the regions, which would suffer if the regional development agencies were abolished, as proposed by the Conservatives.
May I join the Leader of the House in sending our thoughts to the people of Chile, and in the sad tributes that we pay so often to the British servicemen killed in Afghanistan—in the past week, Senior Aircraftman Luke Southgate, Rifleman Martin Kinggett, Sergeant Paul Fox, Rifleman Carlo Apolis and the as yet unnamed soldier from 3rd Battalion The Rifles. Let us hope, as the right hon. and learned Lady says, that they are not forgotten and that their sacrifice is not in vain.
I begin by asking the Leader of the House about a matter directly relating to the armed forces, because now we know from the Chilcot inquiry that the Ministry of Defence felt, in the words of its permanent secretary, that it was running “a crisis budget” rather than being able to plan coherently. Is it not time to recognise that it was a mistake of the Prime Minister to insist on cutting the helicopter budget at a time when our country was in the middle of two wars, and with thousands of British troops deployed?
We have maintained a second to none commitment to our armed forces. It would be wrong for the shadow Foreign Secretary to imply that we in the Government are anything less than fully committed to our armed forces. When it comes to procurement of equipment and financial support for the forces, we will make sure that that commitment is honoured. I am sure that he will be pleased with the increase in helicopters that has recently been announced.
I am not saying that the Government are not committed, simply that they made an enormous mistake in 2004 that let our armed forces down. The former Defence Secretary, the right hon. Member for Ashfield (Mr. Hoon) said at the Chilcot inquiry that
“had that budget been spent in the way that we thought we should spend it, then those helicopters would probably be coming into service any time now”.
Is it not a lesson for everyone that such an error was made? Will the Prime Minister recognise that when he gives evidence to the Chilcot inquiry on Friday this week?
If the right hon. Gentleman wants to know what the Prime Minister is going to say to the Chilcot inquiry, he will have to wait until he says it. It is fatuous for the Foreign Secretary to ask me—[Interruption.] what the Prime Minister is going to answer in evidence to the Chilcot inquiry on Friday. To return to the insinuation that lies behind the right hon. Gentleman’s point, I want to assure the House and everybody in this country who so values the work of our troops that we stand four-square behind them.
That is the second time that the right hon. and learned Lady has called me the Foreign Secretary. She must think that we have had the election already. Turning to the UK economy and this week’s economic news, why does the Leader of the House think that UK Government bonds are priced by the market as almost twice as risky as the bonds of Pepsi or McDonald’s?
The right hon. Gentleman knows that the value of sterling [Hon. Members: “Bonds!”] depends on a range of issues. On his point in relation to his own position, there are two contingencies there. First, he is making the assumption that the Conservatives have won the election. They are arrogant. They have not. [Hon. Members: “You said it!”] Secondly—
Secondly, the right hon. Member for Richmond, Yorks (Mr. Hague) is making the assumption that he will remain in his position. I wonder about that, since the House puts the highest value on integrity—[Interruption.] Yes, it does, and the country—[Interruption.]
This is something that the whole House can agree on—that this House places the highest value on the question of integrity. This country has been misled, and the question is whether it was misled by the deputy chair of the Conservative party, or whether it was—[Interruption.]
First of all, I was not assuming the election result; she was assuming the election result, and the election of the Conservative party. Secondly, the question was not about sterling but about Government debt, to which I shall return in a moment. And thirdly, people in glasshouses should not start throwing stones, because the real party funding issue in this country is the power of the Unite union. It is bankrolling the Labour party, wrecking British Airways and its deputy general secretary, her husband, has just gone through an all-women shortlist to be selected to stand for Parliament. She may not want to recognise marriage in the tax system but she sure does in the political system.
So, let us return to the question, which is the fate of our entire national economy—merely that. As the Governor of the Bank of England says,
“the longer there is not a credible plan that sets out what actions will be taken”—
on the public finances, there is—“a risk.”
If the right hon. and learned Lady does not know about Government debt, why does she think that business investment showed its biggest annual fall last week since records began?
The question is not about one man in this House of Commons; the question is about one man in the House of Lords. When it comes to Government debt, the most important thing is that the economy should grow, that we take action to ensure that there is growth in the economy and that we have more jobs.
It is also important that we are careful about public spending, and of course tax has a part to play in reducing the deficit. People who have promised to pay their taxes, and given assurances, should pay their taxes, so what has happened to the tens of millions of pounds of taxes that the shadow Foreign Secretary promised would be paid by Lord Ashcroft? We want to know.
If she wants to discuss the House of Lords, I am sure that she will want to explain the position of Lord Paul, who was made a Privy Counsellor after he bought 6,000 copies of the Prime Minister’s book on courage. Never has so much been given for so few people to read so many words in vain. She might also want to explain why Labour took half a million pounds from a non-dom hedge fund manager called Mr. Bollinger. Champagne socialism is alive and well in the Labour party, obviously.
We had moved on from debt to business investment—she may not have noticed that—but, given that she raised the question of the pound, does she agree with the Prime Minister, who said some years ago that
“a weak currency arises from a weak economy which in turn is the result of a weak Government”?
So, what does this week’s plunging pound say about this weak Government?
As I said in answer to the right hon. Gentleman’s earlier point, many issues affect the value of sterling, and we are determined to strengthen the economy and pay down the deficit. The issue that he referred to is a question of the assurance that was given by Lord Ashcroft—[Interruption.]
They should enjoy themselves while they are still here, Mr. Speaker.
Is not the continued absence of confidence in the Government’s policies the biggest threat to recovery, as it means that interest rates and mortgage rates will be higher in future than they would otherwise have to be? Would not the real way to create the economic confidence that this country needs be for the Prime Minister, while he is at the palace today, to ask Her Majesty to dissolve this Parliament and call an election so that we can be rid of this disastrous Government once and for all?
The real way to ensure that we keep the focus on the economy growing and more jobs coming into the economy is to continue to pursue the policies that have strengthened and supported it, and not to accept the advice and suggestions of the inexperienced shadow Chancellor—he was described as such by the shadow Business Secretary—because that would undermine the economy. As to the issue of credibility and who we should believe, we cannot have it that the vice-chairman of the Conservative party is right and the shadow Foreign Secretary is right. They cannot both be right—one of them should go.
On Sunday, Bletchley Park in my constituency marked LGBT—lesbian, gay, bisexual and transgender—history month by having a day of celebration of the life and work of Alan Turing. Will the Leader of the House congratulate the organisers at Bletchley Park on this event, which served as a reminder of the unacceptability of the sort of homophobic laws and prejudices that pushed Alan Turing to his suicide in the 1950s?
I congratulate Bletchley Park on commemorating Alan Turing. His work, and his commitment, is taken forward by us in government, because our Equality Bill, which passed through the House of Lords last night, will further strengthen and protect people against discrimination and homophobia.
May I add my condolences and those of my party concerning the five servicemen who bravely died on our behalf in Afghanistan; and our condolences, too, on the earthquake in Chile?
I extend a very warm welcome to President Zuma and suggest to the Minister that in her capacity as Government spokesperson on gender equality she might wish to enter into a debate with him on his strong advocacy of polygamy, and particularly the role that married tax allowances might play in promoting it.
Speaking of tax, I told the Minister several weeks ago that Lord Ashcroft was a non-dom, and it has been confirmed that he avoided approximately £100 million-worth of tax while serving in Parliament. Can the Minister explain why Lord Ashcroft is now claiming that the Government relieved him of the solemn and binding undertaking to remain as a permanent resident in the UK?
As to the hon. Gentleman’s point about the married man’s tax allowance, it is paradoxical that it would be available to a man on his third wife but not to the first two wives bringing up his children. That is one of the many reasons why we do not support the married man’s tax allowance.
The hon. Gentleman, as it turns out, was right that Lord Ashcroft, despite the assurances he gave, was a non-dom, and he was right that the country had been misled into believing that Lord Ashcroft was complying with his previous assurances. I agree with him that there are answers to be given on this, but they are not answers to be given by the Government. They are to be given by the—[Interruption.]
There are answers to be given by the Government. Will the right hon. and learned Lady release immediately all the documentation and records of conversations in the Cabinet Office that relate to this matter? More generally on the issue of non-domicile taxation, can she explain why the Government took on board a Conservative proposal for a poll tax on non-doms that bears harshly on low-income expatriates but is a pathetic flea bite for seriously rich fat cats such as Lord Ashcroft?
I believe that we should have full transparency on this issue, and I agree with the hon. Gentleman on that. The question of the release of any Government papers is a matter for the Cabinet Secretary, but as far as information about this is concerned, we perhaps do not just need to wait for any information that is released by the Cabinet Secretary. We can read Lord Ashcroft’s autobiography, aptly entitled “Dirty politics, Dirty times”, because in it he explains how he came to be in the House of Lords. He says, “I owe it all to William.”
Does my right hon. and learned Friend recollect that we had to fight the Falklands war because the then Conservative Government withdrew the patrols by HMS Endurance and offered to hand over sovereignty of the Falkland Islands to the fascist dictator Galtieri? Will she—[Interruption.] The Conservatives are laughing, but they were going to hand over the Falkland Islands. Will my right hon. and learned Friend reaffirm staunchly this Government’s loyalty to the loyalty of the people of the Falkland Islands and uphold their wishes and their rights?
In fact, 200,000 businesses have been able to stay in business because they have been able to postpone paying their taxes as a way of supporting them through the recession. HMRC has been able to conclude agreements with more than 200,000 businesses, including those in the hon. Gentleman’s constituency, and that is a programme to help business that his party opposed.
Is my right hon. and learned Friend aware of the serious concerns being expressed by individuals, groups and organisations, as well as the press and the media, about the inadequacy of the Dangerous Dogs Act 1991? I speak as a recent victim of an attack, and I share those views. Will she consider having serious discussions with her Cabinet colleagues about that Act, which I am told was hurriedly put together, in order to review it?
I express my great sympathy to my hon. Friend for the fact that she was a victim of such an attack by a dog. I assure her that discussions are under way among ministerial colleagues on this matter. We cannot have a situation where people are afraid to let their kids go to the park or to take their own pets out for a walk in the park, or where elderly people are afraid to be on their own because some people have dangerous dogs. If they will not control them, we have to look again at the law and make sure that they are controlled.
Unfortunately, nothing in the Bill will be retrospective. However, assurances that were made to pay tens of millions of pounds in tax should be kept. The measures we have taken—they were passed in the House last night—are important, but that does not relieve Lord Ashcroft of his obligations to pay his taxes.
We will take our responsibility seriously, and our responsibility is to see this country out of recession and into recovery. I think it is disappointing that the right hon. Gentleman should not accept and support the fact that it is right sometimes for Governments to apologise for what has been done in history that leaves people with a great sense of grievance. When an apology is given, it is the right thing to do, as it was in respect of child migrants and slavery.
My question is indeed about the policy of the Government. Does my right hon. and learned Friend recall that Lord Lawson described the allowance as something that should be allowed to wither on the vine, which it was? Does she therefore agree that there are better things to spend £600 million on than introducing a bit of an anomaly?
I can reassure my hon. Friend that we will continue to invest in Sure Start centres, we will continue the child tax credit and we will continue the child trust fund. I can also reassure her that we will not reintroduce a married man’s tax allowance that would give 13 times more to the richest people than it would to the poorest people. It would not encourage one single couple to get married or make them happy in their marriage. But it would send—and this is why it would be cruel—a clear message to children in families in which the parents are divorced. It would say to them that there was something wrong with their family, and therefore that there must be something wrong with them. That is another reason why we would never introduce it.
The reality is that four times fewer people are unemployed in this recession than in the previous recession, because of the action that we have taken. I assure the hon. Gentleman that we will fight hard to support industry and jobs, especially jobs for young people. That is why we have introduced the future jobs fund, with a guarantee that after only six months every person under the age of 24 will be guaranteed work or training.
Can my right hon. and learned Friend tell the House whether the Government have received representations from the Electoral Commission about foreign money being used to buy British constituencies?
NICE is independent and acts on the best scientific and medical advice. I pay tribute to the progress that has been made in cutting the loss of life from cancer, and the work that is done by oncologists and the rest of the health service to lengthen people’s life expectancy and improve their care. That is one of the things that has benefited from the great increase in investment that we have made. I ask the hon. Gentleman to back our commitment to the guarantee that after someone visits a GP with a suspected cancer, they should see an oncologist within one week.
Bribery Bill [Lords]
I beg to move, That the Bill be now read a Second time.
Before I come to the Bill, I hope that you, Mr. Speaker, will allow me to comment on the news that has just broken that the former leader of the Labour party, Michael Foot, has died. I am sure that that news will be received with great sadness, not only by my party, but across the country. Those of us who knew Michael Foot will have a great many memories of him. I have one particular memory of him from when I was a new Opposition Back Bencher in November 1980. There was a run-off competition between Denis Healey and Michael Foot for the leadership of the Labour party, and on an Opposition day dedicated to the state of the economy—which, I say parenthetically, was not doing all that well—Denis Healey opened the debate and spoke very well.
We all came in for the winding-up speeches, which began at 9 o’clock, and Michael Foot made a speech that suggested to me that he had a line to the Almighty unknown to the rest of us. I witnessed the speech, and so did everyone else, with the same incredulity that I witness the imagination behind a Mozart concerto. The hon. Member for Macclesfield (Sir Nicholas Winterton) may also recall the occasion.
Michael Foot held the House. He had no notes—just a couple of newspaper cuttings—and he started off by saying, “Mr. Speaker, I read in the newspapers that only a couple of members of the Cabinet support the Government’s economic policy. I have been wondering”, he said, scratching his head in his usual way, “how many Conservative Back-Bench Members support the conduct of the economy by the Chancellor of the Exchequer and the Prime Minister.” He paused and said, “Hands up who supports the Government’s conduct of the economy!” and three Members put up their hands, one of whom was, I am afraid to say, the late benighted Geoffrey Dickens. The House collapsed.
Michael Foot continued—it says a lot that I can remember the speech almost word for word 30 years later—by saying, “It is well known that I come from Plymouth, and my father used to take us to a music hall on Saturday mornings, and sometimes there was a conjurer, and this conjurer was one of the most brilliant conjurers in the world. He used to do all sorts of mind-boggling tricks, and one day he said, ‘Ladies and gentlemen, I would like somebody here to produce a gold fob watch,’ and a gold fob watch was produced. What is more,” Michael Foot said, “we knew that it was produced by somebody who was not a stool pigeon for the conjurer; it was a real gold watch.”
“The conjurer said,” continued Michael Foot, “‘Ladies and gentlemen, I am going to put this gold watch on this desk. I am going to get this large wooden mallet and bring it down on the watch. The watch will smash, sprockets will go one way, springs will go another, and then I will utter a spell and the watch will come back together again, and I will hand it back to its owner—it will be perfect.’ The conjurer said, ‘Let me take the watch.’ He put it on the desk, produced the mallet and brought it down with a resounding whack—sprockets go one way, cogs go another, winding wheels go a third and the case goes a fourth way. Then,” said Michael Foot, “there is a very, very long pause, and a longer pause, and then the conjurer turns to the audience and says, ‘Ladies and gentlemen, I’m really sorry, but I’ve forgotten the rest of the trick.’” Then Michael Foot said, “And, of course, Mr. Speaker, the problem for the Prime Minister and the Chancellor of the Exchequer is that they have forgotten the rest of the trick,” and he sat down. It was absolutely brilliant, and that speech gave him the Labour leadership.
Order. I have indulged the Secretary of State because he has been paying a gracious and eloquent tribute to a quite extraordinarily distinguished parliamentarian, whose loss we all lament. I hope that the House can fairly quickly move on to the Bribery Bill, but I have great respect for what he has just said.
I am very grateful to you for your indulgence, Mr. Speaker. As I said, Michael Foot was held in great affection in all sections of the House and in the country.
Let me now turn to a Bill that our late and honoured friend would have supported: the Bribery Bill. Modernising and strengthening the law on bribery is one of the key strands of the Government’s foreign bribery strategy, which I launched in January. I am known—rather pompously, I think it is fair to say—as the Government’s anti-bribery champion, but I am very happy to champion that cause.
Bribery, as we know, is an insidious offence. It undercuts honest companies and distorts the free market. It causes state institutions to lose their legitimacy and public confidence in the political system to wane. Where bribery is allowed to flourish, democracy struggles to take root. Its impact on development is equally damaging. Bribery discourages foreign aid, feeds inequality and injustice, and diverts valuable funds away from basic public services. The rich get richer, the poor get poorer, and the most vulnerable in society are hit the hardest. One of the consequences of bribery and the misuse of developments funds, whether they come from the state or from charitable causes, is the undermining of public support in wealthier countries, including this country, for continuing that assistance.
The scale of bribery across the globe is immense. We have to rely on estimates, and although there is no precise estimate of fraud or bribery, the World Bank has estimated that some $1 trillion is paid annually in bribes, adding around 10 per cent. to the cost of doing business in some countries. There is both a moral and a practical imperative for tackling bribery. As a nation reliant on world trade for our prosperity, the United Kingdom is duty bound to set an international example in stamping out this scourge. Changing the law on its own, whether in the context of bribery or any other sphere, is necessary but, of itself, not sufficient. The Bill is therefore one part of our wider strategy to tackle bribery by supporting ethical business practices in British companies, enforcing the law effectively, and working with our international partners to promote good governance overseas.
That the criminal law on bribery is in need of reform is not in dispute, and certainly not in this House. The current patchwork of offences derives from a mix of common law and rather old statutes, which together have not been substantially altered since the first world war, when Britain was one of the first countries to legislate against any form of corruption. The law has never previously been consolidated, and contains inconsistencies of both language and concept. The result is a body of law that is outdated, complex and, in some respects, uncertain in its effect. As a consequence, it is difficult—although, as we have recently seen, not impossible—for investigators and prosecutors to apply the law sensibly. Therefore, the case for reform is compelling; nor, I am pleased to say, is there now much dispute over how we should change the law.
Does the Secretary of State agree that the difficulty is that people can buy their way out of some bribery charges if they can afford a good enough lawyer? The inconsistencies in the legislation as it stands are not so easily manipulated by people who cannot afford really good legal advice, but they can be taken advantage of to prove someone’s technical innocence, as long as they can spend tens or even hundreds of thousands of pounds on lawyers who really understand the ins and outs of the inconsistencies that the Secretary of State has described.
The fact that, notwithstanding the inherent difficulties, there have been successful prosecutions shows that the law is not in an impossible state, and nor should the hon. Gentleman believe that purchasing good legal advice is a means by which people can escape prosecution, conviction and justice. None of us should gainsay the idea that people are entitled to the best legal advice. Indeed, we have the best funded legal system among comparable countries that I can think of. However, the hon. Gentleman makes the case for reforming the law, to straighten it up and modernise it.
The Bill is closely based on proposals put forward by the Law Commission in November 2008, following its customarily careful and thorough analysis of the issues, and extensive consultation with those affected. The approach taken by the Law Commission was strongly and unanimously supported by the Joint Committee that examined the draft Bill. I pay tribute to the work of both the Law Commission and the Joint Committee. The fact that the Bill has attracted wide-ranging support and has passed through the other place with few changes—I shall come to those—is testament to the solid foundations laid by the Law Commission and the Joint Committee.
The core element of the Bill can be briefly described. The Bill creates four offences. The first two are to be found in clauses 1 and 2. Clause 1 makes it an offence to give, promise or offer a bribe, while clause 2 deals with the reverse situation of requesting, agreeing to receive or accepting a bribe. Clause 6 creates a bespoke offence of bribing a foreign public official in order “to obtain or retain” a business advantage. The UK takes its international obligations seriously and this House should be in no doubt that our law is already compliant with the various international conventions combating bribery, to which this country has put its name. This specific offence will underscore our adherence to the OECD’s convention on combating bribery of foreign public officials in international business transactions.
The quartet of offences is completed by clause 7, which deals with the offence of failure on the part of a commercial organisation to prevent bribery. That is a really important offence. It will, however, be a defence for a commercial organisation to show that “adequate procedures” were in place to prevent bribery. I will say a little more about that in a few moments. All those are serious offences, in recognition of which we are increasing the current maximum penalty of seven years’ imprisonment to 10 years. A commercial organisation convicted on indictment of an offence under the Bill would be liable to an unlimited fine.
I thank the Secretary of State for giving way on that particular point, because the penalties are a rather important aspect of the Bill. Does he agree that under existing legislation, unlimited fines are available, but the sentencing guidelines mean that the courts do not always take the offences as seriously as they should? Is he saying that because the penalties are changing, the sentencing guidelines will also have to be reconsidered?
The hon. Gentleman raises an important point. We are about to establish the Sentencing Council to take over the twin roles of the Sentencing Guidelines Council and the Sentencing Advisory Panel. It would be sensible to invite the new Sentencing Council to look afresh at its guidelines—and given the hon. Gentleman’s suggestion, I undertake to do so—in the light of the greater seriousness with which I believe Parliament has already and hopefully will continue to take these offences and the whole issue of bribery.
Further to the previous intervention, does the Secretary of State appreciate that the sentencing guidelines conflict in some ways with other sentencing powers, particularly in respect of the Proceeds of Crime Act 2002? Businesses say that people might not come forward because once they have been convicted under this Act, they might be liable to prosecution and penalties under other Acts. Is the Secretary of State going to look at that?
In a sense, that is more a matter for the prosecutorial authorities, but I will certainly look at it. If somebody has egregiously taken a bribe, they are unlikely to come forward and volunteer the information in any event. They might have to enter into a compromise agreement, which is a rather different matter. [Interruption.] I will give way shortly to the hon. and learned Member for Beaconsfield (Mr. Grieve).
Currently, there is not a corporate offence; we intend that there should be. There will be a responsibility on companies in practice to come forward if they have uncovered evidence. I think that the hon. Member for Huntingdon (Mr. Djanogly) is saying that there should be no protection for those who have been of criminal intent and purpose and effect, but that there should be protection for the innocent company directors and the company as a whole where they have acted properly, and that they should not penalised provided that it can also be shown that they have not profited unjustifiably from the crime. I will certainly follow up the issue and write to the hon. Gentleman.
“Double jeopardy” is a much overworked phrase. It could be argued that it is double jeopardy for someone who has committed a fraud both to end up in the criminal court and to lose his job, but I do not call that double jeopardy. It is simply the consequence of a criminal action.
I happen to believe that the Proceeds of Crime Act 2002 is a very important measure. I would believe that, of course, because I initiated it back in 2000; it was passed after the 2001 election. I think it fair enough for people who have committed a criminal offence and have also received proceeds in a criminal way to have to pay those proceeds back. However, I accept the hon. Gentleman’s point.
This discussion touches on an important issue. The system that we are setting up and, in particular, the way in which the Serious Fraud Office has been working are undoubtedly intended to encourage companies to come forward and admit wrongdoing if it has taken place, and to accept that penalties that will flow from it, but also, in doing so, to mitigate the offence. The system is thus much more like a regulatory regime than any system we have had before. I think that a difficulty will arise if it is perceived that there is no effective framework in which that interplay can occur. One of the aspects of the Bill that will raise anxieties is the fact that, in a rather English way, we are enacting adversarial criminal legislation which, if it is to work properly, will require a regulatory framework involving an understanding of the commercial world in which some of the decisions will be made.
If I may defend the hon. and learned Gentleman, Mr. Speaker, he raised a very important point, and, in doing so, anticipated what I was going to say next. As he observed, we are moving into what amounts to a new regulatory framework.
Over the past 18 months, I have held round-table meetings with representatives of organisations such as Transparency International and CAFOD—the Catholic Fund for Overseas Development—which are concerned about the effect of bribery, particularly in developing countries. Transparency International does a terrific job in ensuring high standards throughout the world. In the same room have been representatives of the CBI and of large business corporations with substantial business overseas, whose staff and agents often work in countries where there is a culture of bribery and corruption and where they could otherwise have been vulnerable to that environment.
One of the points made by the business organisations, which I have accepted, concerns the need for proper written guidance to the new framework. Such guidance would equip them with yardsticks enabling them to judge whether they were complying with the provisions in clause 7. We have already begun to draft the guidance, in collaboration with the prosecutorial authorities and others, and it will be issued well before clause 7 comes into force. A commitment to provide guidance is enshrined in clause 9, which was added to the Bill on Report in the other place. I was anxious that it should be there, because, although I look forward to serving in my present office for at least a further decade, there will come a time when even I shall have to move on, and it is important that undertakings given now can be sustained by a statutory requirement.
The Under-Secretary of State is looking rather worried about the prospect of the Secretary of State’s remaining in office for another 10 years, and I share her concern.
Does the Secretary of State intend the guidance to be published before the Act is implemented? As for the sentencing guidance mentioned by the hon. Member for Cambridge (David Howarth), will the conversations that the Secretary of State promised to have include consideration of the need to increase the penalties for economic crime generally? Money laundering currently attracts a maximum of seven years’ imprisonment, whereas the sentence for theft and handling is 14 years. I believe that we need to increase the seriousness with which the courts take these matters.
The guidance will be issued before the Bill comes into force—although not, obviously, before it becomes law—and we will ensure that businesses and organisations representing them have time to digest it before the sections of the Act to which it relates come into force. The vast majority of business people, whether their businesses are small, medium-sized or large, are transparent and honest, and want to do a decent job. What we must not do is gratuitously catch them out.
I am sorry that the Lord Chancellor is being subjected to a barrage of Front-Bench interventions, but another issue arises. I am sure the Lord Chancellor agrees that there are often grey areas in what is bribery and what may not be. In other countries—including, I believe, the United States—it is often possible to refer a specific matter to the authorities in order to obtain guidance on whether or not a payment is appropriate, but we do not have such a system in this country. Should we perhaps consider adopting one?
I will certainly consider it.
I apologise to the hon. and learned Member for Harborough (Mr. Garnier) for not replying to his second question. He was right to suggest that sentences relating to such offences as money laundering should be brought into line with those relating to more general offences, so that the courts receive a message from this place that so-called white-collar crimes are just as important, pound for pound, as crimes committed by a common thief—thefts of tangible or what Dickens used to call portable property.
The hon. and learned Member for Beaconsfield asked whether it would be possible to establish an office where people could submit the full details of what was being proposed and be given a tick or a cross against it. I do not think it desirable to provide for such a scheme in the Bill, and in any event it would not be possible to do so in the time available to us. Certainly we have been given no advice to that effect. What I will say to the hon. and learned Gentleman, however, is that clause 7(2), plus the guidance, will give commercial organisations that have acted responsibly, assiduously and in good faith such a complete defence to any prosecution in respect of an individual case that it is unlikely that one would ever be launched.
Clause 7(1) makes a “relevant commercial organisation” guilty of an offence if a person associated with that organisation
“bribes another person intending—
(a) to obtain or retain business for”
the organisation, or
“(b) to obtain or retain an advantage in the conduct of business for”
However, the second limb of the clause—expressed in subsection (2)—states that it is a defence for the relevant commercial organisation to prove that it
“had in place adequate procedures designed to prevent persons associated with”
the organisation “from undertaking such conduct.”
This measure is not designed to trip up decent companies that are acting responsibly or in good faith. On the contrary, it is designed to help them, because, as the experience from other countries has shown, the more it is made an imperative that those representing major businesses across the world are themselves under a requirement to act lawfully, the less will be the opportunity for those who are so tempted either to seek or offer bribes. I undertake to this House that we will keep the guidance issue carefully under review; it will have to be a kind of living document, therefore.
Clause 13 has proved to be a sticking point. It provides for a defence for conduct necessary for the proper exercise of the functions of the intelligence services and the armed forces engaged on active service. The House should be in no doubt of the need for such a defence. Members will understand that I cannot go into operational details, but there are circumstances in which it is necessary for the effective discharge of the functions of one of the intelligence agencies or the armed forces that they engage in conduct that would otherwise amount to an offence under clauses 1 and 2. They need to do so because they are working to protect us and our liberties in difficult, and often dangerous, circumstances. We are being very straightforward about that in making provision for this defence.
The truth is that nowadays our intelligence services are subjected to a far higher degree of transparency and accountability than those of most other comparable countries. Again, the House will, I know, excuse me for not being able to go into as much detail as I would like, but the difference is striking. That used not to be the case, of course. Before the passage of the Security Service Act 1989, our intelligence and security agencies—GCHQ, the Secret Intelligence Service and the Security Service—were never “averred”, a strange verb meaning that their existence was never admitted to. Everybody denied that these agencies existed, even though there they were in Century house above a petrol station on the St. George’s road to the Elephant, and in Gower street and—[Interruption.] No, it is not Michael Foot again. They were also in Curzon street. That changed, however. First, we had the 1989 Act, and then the Intelligence Services Act 1994, which also established the Intelligence and Security Committee. Those Acts, along with the Regulation of Investigatory Powers Act 2000, mean that we now have substantial ministerial, parliamentary and judicial oversight.
May I put to the Secretary of State a point about this clause that was made in the other place? These services have a function that goes beyond national security: upholding the economic interests of the country. It has been suggested that it is not appropriate for the permission to bribe, or to be bribed, to be used for that purpose, as opposed to the main purpose of national security.
I understand, of course, the concerns that are felt about the operation of the intelligence and security agencies, because they have to work in secret in order to protect our liberties, and there is not only a paradox in that, but a tension, too. Also, to be blunt, those anxieties have clearly been heightened by recent court decisions and what has been exposed as a result, although that has only come out because of the level of transparency that this House has put in place from the specific Acts I have just mentioned through to the Human Rights Act 1998.
I was going to make the following point later, but perhaps I should mention it now. I am in a literally unique position in this House, as over the years I have been responsible for all three of the intelligence agencies. My view is that the functions that are laid down—which, as the hon. Member for Cambridge (David Howarth) said, include economic well-being—are as narrowly defined as they can be. It would be very difficult—in fact it would involve some casuistry and theology—to say, “They could do this, but they can’t do that.” In an instant case, it can be difficult to say exactly which limb of which function a particular operation might come under, and usually they come under more than one. I therefore hope the hon. Gentleman does not pursue that point.
Most Members recognise that there might be occasions when the intelligence and security services will offer cash or some other advantage in order to obtain information. I am, however, concerned about how the term “active service” in clause 13 might be interpreted. I would not under any circumstances want the procurement of military or intelligence equipment to be deemed to be exempt from the provisions of this Bill because that equipment was to be used in a military operation. Can my right hon. Friend give me the assurance I seek?
I have to rely on what clause 13 says:
“It is a defence for a person charged with a relevant bribery offence to prove that the person’s conduct was necessary for—
(a) the proper exercise of any function of the Security Service, the Secret Intelligence Service or GCHQ”,
or, secondly, that it was necessary in relation to
“the armed forces when engaged on active service.”
I think my hon. Friend was referring to the first of those limbs.
If my hon. Friend has a concern in respect of the armed forces, I should point out to him that the clause states that
“‘active service’ means service in—
(a) an action or operation against an enemy,
(b) an operation outside the British Islands for the protection of life or property, or
(c) the military occupation of a foreign country or territory”—
and there are various definitions following that statement. My hon. Friend will, I hope, excuse me if I do not speculate about the precise terms of any decision made variously by the directors general or a Secretary of State about a particular operation. I shall return to this point later. The decisions that are taken are not taken capriciously. The functions of the three services are laid down in two Acts—the 1989 Act deals with the Security Service’s functions and the 1994 Act deals with those of the Secret Intelligence Service and GCHQ. I assure my hon. Friend that it is unlikely or wholly improbable that the kind of circumstances that he describes would arise.
I am trying to remember the exact wording, but I seem to recollect that one of the functions of the Security Service and the SIS is to ensure the economic security or well-being of the nation. One can imagine how one interpretation of that could suggest that bribery might be used to secure some economic or commercial advantage. I am sure that that is not the Government’s intention, but the issue will have to be addressed in the explanation given as the Bill goes through the House.
I should say to the hon. and learned Gentleman that the wording slightly differs. One function of the Security Service is
“to safeguard the economic well-being of the United Kingdom”—
there is no full stop, because with a bit of luck that is a function of the Treasury, the Department for Business, Innovation and Skills and the rest of us—
“against threats posed by the actions or intentions of persons outside the British Islands.”
As I say, similar, though not the same, language is used in respect of the other two agencies. It is right that these provisions should be scrutinised, but I hope that it will be possible to reassure the House and the Committee on them.
We could have done what other jurisdictions do, which is to be silent about all this. It is much easier to be silent about this, particularly in civil Napoleonic systems, as I know to my certain knowledge, having discussed what protections are given in practice to intelligence agencies by the judicial systems of some of our European partners. Their approach is straightforward and it is a matter of policy: nothing is on the statute book, but everybody knows what they need to do and everybody does it. Our system is much more open and because of that I thought it would have been disingenuous to have remained silent on this issue and it would have been intensely unfair on officers or agents of the intelligence services and armed forces who may be asked to undertake this unpleasant activity in the course of their work. Nobody should be put in a position where they are placed at risk of prosecution for engaging in work that would otherwise be unlawful but which is necessary in pursuit of the security of the state. I believe that there is common ground on that.
The question to address is what form the special provision for the intelligence services and armed forces should take. The 2003 and 2009 draft Bills contained provision for an authorisation scheme cast in similar terms to section 7 of the 1994 Act. That provides for an authorisation by the Secretary of State and, in practice, by the Foreign Secretary of the day. An authorisation allows members of the agencies to undertake activities that would otherwise be in breach of the criminal law. That was the original proposal, but the Joint Committee that examined the most recent draft Bill was not persuaded of the case for these special arrangements and therefore proposed the removal of the authorisation scheme. I examined that, and I tried to respond to the criticism that was made of the Bill and improve the Bill. I thought that if there was a better and lighter way of meeting the same purpose we should use it. We, thus, withdrew the authorisation scheme and concluded that a better approach would be to provide for a defence.
The defence is a more focused and case-specific mechanism than the authorisation scheme contained in the draft Bill. An authorisation scheme needs to provide for a wider authorisation if it is to be workable in practice and confer the necessary operational flexibility. If I may say so, that is one of the fundamental defects with the authorisation scheme that has now crept into the Bill in a subsection of clause 10. The House of Lords accepted that there was a need to make special provision, but it argued that there was a greater need for better oversight of the conduct of the intelligence services and armed forces in respect of conduct that would otherwise constitute an offence. The other place also argued that the defence was cast too wide in that it included law enforcement agencies. I recognise the strength of the second argument about the breadth of the defence, and we have now narrowed the application of the provision down, in effect, to the intelligence agencies and the armed forces—and nobody else. I am grateful to Members of the other place for drawing our attention to that defect.
As I am about to explain, the Government intend to seek to amend the clause, because it will create a hybrid and very uncertain set of authorisations. I hope that I can convince the hon. and learned Gentleman and the House that not only is it not necessary, but it is not desirable. I should say to him that when I examined it my starting point—my default position, as it were—was to see whether we could accommodate it. Why would that not be my position because, particularly at this stage of a Parliament, I am not picking fights unnecessarily?
No, no, I am not, and I am certainly not doing so on something as esoteric as this. However, I came to the view—I am clear about this—that this provision is both unnecessary and undesirable.
The other place accepted the case for the defence clause, but what it did, not as an alternative, but as an addition, was decide to put in place a discretionary ministerial authorisation scheme, and that now forms subsections (6) and (14) of clause 10. What are the defects of those provisions? One defect is that they would sanction conduct covered by the offence at clause 6 of the Bill, which is derived from the OECD’s convention on combating bribery of foreign public officials. The Bill as originally drafted did not allow for that possibility. We could put that defect right, but what cannot be put right is the ill-conceived hybrid arrangement, which seeks to combine an optional authorisation scheme with an existing defence. The arrangement is neither one thing nor the other, and thus creates uncertainty about its legal and practical effects and, in the process, undermines the purpose of clause 13.
I remember sitting in this House before I had responsibility for any of the intelligence agencies and sometimes thinking that I was being asked to take on trust undertakings being given in this place by Ministers who say that they know it all but that they cannot communicate what they know. Mostly we did take things on trust from distinguished members of the previous Administration such as Lord Hurd and Lord Howe, and rightly so. Some people have the idea that the intelligence agencies operate in highly regular circumstances—it is a highly regulated system—whereby they have the time to consider individual applications for actions out in the field and these can then be weighed in the balance and an authorisation sought for them prospectively. All that is true in respect of activities by the agencies that are covered by warrantry, which include interception of different kinds and intrusive surveillance. However, some of their actions are inevitably fast-moving—people must have authority at a point at which they are exercising sensible discretion on behalf of the state.
The previous authorisation scheme, which the Joint Committee did not like, was cast to take account of the necessary flexibility that is required by the agencies. It is paralleled by section 7 of the 1994 Act. This provision, however, is far too specific and would jam up the system. I remind the House that there is already intensive supervision of the work of the agencies. Each of the substantive Acts—the 1989, 1994 and 2000 Acts—provides for there to be commissioners who are retired senior members of the judiciary, typically and usually retired Court of Appeal judges, who scrutinise the various aspects of the agencies. Having been subject to their scrutiny, I can tell the House that that is not something that they take lightly. No sensible Secretary of State takes it lightly, and neither do the agencies. Of course, a lot of what they do cannot see the light of day, although they publish redacted reports, but it is extremely important.
With the mechanisms for external accountability in place, in addition to a robust system of internal checks that are partly prompted by the external checks, there is then a powerful onus on the individuals concerned who are carrying out and authorising operations to demonstrate and be satisfied that the proposed action is both necessary and proportionate. Our view, which the Under-Secretary of State for Justice, my hon. Friend the Member for Watford (Claire Ward)—who has just disappeared from the Chamber—will be urging the Committee to accept, is that the defence, when combined with these existing oversight mechanisms, provides an appropriate level of accountability.
In providing a purely discretionary authorisation scheme, the Lords amendment to clause 10 at one level arguably adds nothing but its effect would be—I promise the House—to add confusion and uncertainty. However, through my hon. Friend the Under-Secretary, I shall consider whether we can provide further assurance to the House that there is effective oversight of the conduct of the intelligence services and armed forces that engages the clause 13 defence.
I hope that the House will accept what I have said. I also hope that it will accept the good advice of, for example, Transparency International. As a senior Minister in this Government I have responsibilities for getting a Bribery Bill on the statute book, but as a senior Minister—not least as one who has had responsibility for the various agencies over a nine year period—I also have a responsibility to ensure that those agencies can operate effectively and sensibly. I hope that Members of the House will not allow the best, in their view, to be made the enemy of the good. We cannot put on the statute book a Bill that, in dealing with one mischief—bribery—creates a worse mischief, undermining the effective, proportionate and lawful work of the agencies. Transparency International said that it believed that the issue about clauses 13 and 10
“should not be allowed to derail the Bill”.
That is good advice.
The Bill will put in place a coherent, comprehensive framework of criminal law. It will make it abundantly clear that bribery has no place in this country and that it will not be tolerated in our commercial and other dealings with the rest of the world. Those are aims to which the whole House, I hope, can subscribe, and I hope that we can now get on and pass the Bill. I commend it to the House.
Bribery Bill [Lords]
In welcoming the Bill and in the light of the comments made by the Lord Chancellor, I do not think that I can start my remarks without echoing the sadness on the Conservative side of the House at the death of Michael Foot. Although, having entered the House in 1997, I never had the privilege of being in the House at the same time as he was, as a schoolboy at Westminster it was my habit as a boarder to slip over the road at 4 o’clock in the afternoon and, my father having given me a very good tea, to go up into the Public Gallery and watch the debates. There is no doubt that one of the most entertaining orators was Michael Foot. I have vivid memories of displays of pure genius at the Dispatch Box.
I was also present a little later at that famous vote when the Government lost their majority in 1979, during the debate on no confidence, when he wound up for the Government in a performance that was simply brilliant, extremely entertaining and mordant—I seem to remember some extremely barbed comments at the expense of the nationalists. It was a great display of political skills. Looking around the House today, one has that rather sinking feeling when one thinks about the eccentricities in his character, which were regarded as great marks of his quality, and the fact that we have perhaps lost something today in that we are no longer capable of accommodating such eccentricities in our political process. In fact, we might be greatly advantaged if we were better able to do so. I echo from this side of the House the remarks made by the Lord Chancellor and say that I can only look back on it as a formative experience in my life to have had the privilege of witnessing Michael Foot in action.
We welcome the Bill, as we have made abundantly clear—and not only in the welcome that, I hope, has been apparent from our interventions. It has been too long in coming. I think that the Government promised in 1997 that we would have such a Bill. I certainly do not criticise the Secretary of State, but we only got something in 2003, there was a consultation in 2005 and the process has dragged on for a very long time.
We now have a Bill, but we also have the anxiety that it is up against the wire of the end period of this Parliament. There must be some public anxiety that it might founder before it can get on the statute book. At the outset, I want to tell the right hon. Gentleman that we will do our best to help to ensure that it gets on the statute book. I would like to think, because of the degree of consensus that surrounds so many aspects of it, it should be possible to do that, although I hope that the Government will listen to some of the hopefully few but nevertheless significant areas of anxiety that we might still have about it.
We also recognise that the issue is very important. International corruption, and national corruption, ought to be of concern to everybody in this House and, indeed, to the wider public. We should be troubled both by the fact that we know that the World Bank’s estimates that the sums involved run at $1 trillion annually and by the fact that over recent years the UK has come in for increasing criticism about whether it has sufficiently robust procedures and processes in place to prevent corruption.
The Secretary of State will remember the episode surrounding British Aerospace. I do not wish to get bogged down in a piece of history, but that highlighted very clearly that inadequate procedures were in place to prevent bribery abroad. It also highlighted the fact that the law was so grey in its scope that it was always inevitable, in my judgment, that the Attorney-General and the Serious Fraud Office would come to the conclusion that there was no possible basis on which a prosecution could have been brought in the first place. National security issues are another consideration. Those issues have without doubt redounded to our disadvantage on the world stage. Indeed, as the Secretary of State will be aware, Britain’s rating on preventing corruption has slipped consistently in recent years. It is high time that we did something about that.
The Bill is broadly welcome. It covers all the main aspects of bribery and the ways in which it might be carried out, and that is exactly what we need to take matters forward. I certainly do not wish to labour my remarks, and having made a general welcome, I hope simply to highlight the areas about which we continue to be anxious regarding the methods that the Government have adopted.
Let me start with what I recognise to be perhaps the most controversial or difficult area: how consents are given for prosecutions. This is a difficult issue for the House, and there has certainly been anxiety in the past that consents to prosecutions, particularly if they lie in the hands of the Attorney-General, may be manipulated politically, or for some political reason, independently of what the wider interests of justice might be. The Lord Chancellor will know that that is never a position to which I personally subscribe because my view is that previous Attorneys-General, over many years and across many Administrations, have not been tainted by party political considerations or gaining narrow political advantage in taking their decisions, and that they have always found it quite easy to uphold public interest principles.
The problem is that the Government have taken the view, in the Bill, that the necessary consents should lie with the directors of prosecution departments. Rather than assert a standpoint on this matter, I want simply to pose a question. The difficulty that I perceive with the Government’s approach is that some such decisions will be of great public controversy and that once such a decision has been taken, particularly one that no prosecution should be brought, we are going to face difficulties regarding public anxiety about how that decision was arrived at and who in this place is answerable for it. The Lord Chancellor will be aware that the buck tends to stop in this Chamber, and it will undoubtedly be the Attorney-General—or, if he is another place, the Solicitor-General, I suppose—who will stand answerable. I wonder whether there would be the advantage that the Liberal Democrats and some others perceive that there would be to leaving final decisions in such cases to heads of departments who are not in a position to answer to the House directly.
I want simply to flag this issue up, and I do so without reaching any conclusion as to where we should go. I know that this matter has been the subject of wider anxiety. Indeed, the Liberal Democrats tabled amendments to the Constitutional Reform and Governance Bill yesterday, seeking to remove the role of the Attorney-General in all prosecutorial decisions. I happen to think that that is the wrong thing to do. That is not to say that the Attorney-General should have a say in every prosecutorial area, but this area is likely to attract a lot of public attention, and the old principle behind having the Attorney-General take the final decision is that he is answerable to Parliament. We will lose that with the system that we are setting up.
I shall return, in my speech, to the point that the hon. and learned Gentleman raises. The point that I wish to put to him now is that the anxiety about the independence of the SFO, for example, is one of the issues that has been raised—more than once, I think—by the OECD, which is concerned about political interference of any sort in corruption cases.
I appreciate the hon. Gentleman’s point, but we cannot easily get away from this matter. Of course, one can set up a prosecutorial system in which Parliament, the Executive and the Government have absolutely no say whatever in any prosecutorial decisions, but I think that is fanciful because, as we have said in previous debates, there are times when public interest elements come into play that make it absolutely essential that someone who is answerable politically should take the final decision. If the choice is between prosecuting someone and having a nuclear exchange with another country, it might legitimately fall to the Executive to take a view. We have had such problems in relation to hijackings; the situation arises on numerous occasions. I repeat that I do not have a concluded view on this. However, my gut instinct has always been that if the person who has to take the final decision has to come to the House and answer for it, that might produce a more robust political and public debate than if someone comes along and says that an independent, permanent official at a very high level has taken the relevant decision, but then be unable to give a better explanation or a better defence. I simply flag that up, but I think that the Lord Chancellor is also aware of this issue.
I am grateful to the hon. and learned Gentleman for flagging up that point, which will need further consideration in Committee. My view is that because of the, I may say wholly unjustified, suspicion in some quarters about the role of Law Officers who are also Members of this House—as I believe very strongly they need to be for precisely the reasons of accountability that he raises—it is better to have the authority resting with the relevant directors. Those directors already have a duty to inform the Attorney-General, so it is not as though the Attorney-General would have to explain the matter blind. However, we will look into this issue. May I also point out that a refusal to institute proceedings is, these days, reviewable in the courts, which have, as in many other areas, accepted a jurisdiction in such cases?
Yes, indeed, and it is arguable that it might be neutral one way or the other as to whether it is the Attorney-General or one of the departmental directors who takes such decisions under the system, but it certainly provides a mechanism by which individuals who feel that the decision has been taken wrongly can have it reconsidered.
My hon. and learned Friend makes some valid points, but I should like to tell him, as someone who has spent a lot of time overseas exporting British goods in Africa and the middle east, that the number of contracts that we lost because some of our European partners were far more prepared to give bribes than we were has been very frustrating at times. Does he share my hope that, if we are passing stringent legislation, discussions are going on in the European Union to ensure that our French and Italian counterparts are introducing similar legislation?
I certainly agree with my hon. Friend. What seems to happen, as the decades go by, is that the world view of countries’ propensity to tolerate bribery alters. When I was younger there seemed to be a widespread view that this country was intolerant of bribery and that many foreign countries, including countries in the European Union, were prepared to tolerate it, particularly in the contexts of bribing officials abroad and achieving economic benefits for that state. I seem to remember that it was rather widely suggested that the United States turned a blind eye to the bribery of foreign officials, but it is worth pointing out that, for the most part, all those countries appear to have tightened up their acts considerably. Indeed, it has been argued that the United Kingdom, having started out as a paragon of virtue, has slipped precisely because we have perhaps been rather complacent about some of the changes that were taking place, which we have not properly addressed.
We should bear all that in mind, but I certainly agree that there are two different issues: the laws that we implement and the manner of their enforcement. As our country has a good reputation, on the whole, on enforcing the laws that we enact, I am anxious—as, I am sure, is the Lord Chancellor—that we should not, as a result of enacting and enforcing vigorously the laws that the OECD wants, end up in the position of finding that our European partners are taking a much more lax approach. I certainly endorse the Government co-operating with our fellow members of the EU and the Government of the US in trying to ensure that there is a level playing field. There is no doubt that one reason why the bribery of foreign officials has taken place has been the claim, “Well, if we don’t do it, the others will.”
Until we get away from that mindset we will not bring about the changes that I think are so badly needed. Although the bribery of foreign officials may not have a direct impact here, we cannot escape the fact that it is enormously damaging to the rule of law and the integrity of the public service in the countries where it does happen. Moreover, because there is often collusion at the highest level, bribery can promote a culture of kick-backs that is not conducive to good commercial relations in the long term across the globe. For all those reasons, therefore, the bribery of officials is a pernicious phenomenon that we would do well to tackle.
I was grateful to the Lord Chancellor for going into detail on a matter that arose earlier—the question of safeguards and the security services, as covered by clause 10. We recognise that the security services must have an exemption: there can be no doubt about that, and not to have an understanding that they must be given that exemption would be to fly in the face of reality. We are pleased that the Government have restricted the exemption in the case of law-enforcement agencies, and I do not have too many anxieties about the exemptions given to the armed forces, given how they have to operate in reality, certainly in countries such as Afghanistan.
However, I am rather keener on the extra level of protection inserted in clause 10 by the other place. I shall explain why to the Secretary of State, and the matter can doubtless be teased out again in Committee. There is a considerable difference between providing a defence for something, which can be argued in court, and providing a safeguard for a public official who is carrying out a function that he believes he has been specifically told to carry out on the basis that it will not be a criminal offence.
As I am sure that the Lord Chancellor is aware, a person who is prosecuted gets put through a process that is deeply unpleasant, even when it ends in acquittal. That must not be embarked on lightly. However, when an action taken by the security services is authorised as acceptable at the highest level—even though it might otherwise be in breach of this Bribery Bill—it is pretty much inconceivable that the person involved will ever be prosecuted, as the Lord Chancellor said.
If that is the case, though, should not the ability to invoke the safeguard provided as a result of the scrutiny of this Bill in the House of Lords also be retained? I simply flag the matter up, and we can doubtless have a debate about it in Committee. If the Lord Chancellor feels that that proposal would lead to profound problems, we will be able to articulate them in Committee, as this is more a matter for Committee than Second Reading. However, we think that the Bill has been improved marginally in the other place, and that this is one example of that. We would be sorry to lose the provision, unless good reason can be shown for doing so.
I want to return to one matter in connection with clause 7, which provides for an offence of negligence. This House needs to be very careful when creating offences of negligence that can attract substantial penalties. The clause requires systems to be set up but, if those systems are absent, the defence that may exist for a corporation will disappear.
I have no difficulty with that at all. It is clearly a serious matter when commercial organisations fail to prevent bribery, and the architecture of the Bill would collapse if clause 7 did not exist. For those reasons, it has to be there but, as I highlighted to the Lord Chancellor in my interventions, I have some concerns about whether adequate guidance is in place to ensure that commercial organisations are on the right side of the law. In many respects, the provision represents a regulatory aspect of the Bill, and I think that it needs to be included.
I asked the Lord Chancellor about the US, where companies can speak to the Department of Justice and seek guidance on individual payments. That is a regulatory framework and seems to work quite well, but we are not going to have anything like it here. For that reason, it is something that will merit further attention.
Finally, there is one matter that is not contained in this Bill, but which was covered by the draft Bill—the whole issue of parliamentary privilege. The Lord Chancellor and Secretary of State will remember our debates on the Independent Parliamentary Standards Authority last summer. Opposition Members made it clear that we did not think that the criminal offences being created for Members of Parliament were suitable, because we took the view that the matter should properly be dealt with in the Bribery Bill.
We were wholly supportive of the notion that the possible defence of parliamentary privilege that might be invoked to escape prosecution for an offence of bribery should be made unavailable. That has not happened, although I am well aware why the Secretary of State has chosen not to make it unavailable. I think that he took the view that, in light of the Select Committee’s report, that approach would be much too controversial and get Parliament bogged down.
It may be that there is a slightly academic element to the argument, particularly in light of everything else that we have done in respect of setting up IPSA. Something in me suspects that such circumstances are unlikely, or will occur only very rarely, but this is unfinished business. To resolve the matter, at some point we will either have to do something in bribery legislation or—and this may be better—introduce a proper parliamentary privilege Act. Neither approach is easy, and I simply suggest to the Lord Chancellor that it might be easier to legislate on an exemption in a Bribery Bill than to have a parliamentary privilege Act, particularly in view of some of the controversies surrounding privilege. Again, I hope that we will be able to look at that when the Bill is in Committee. I am not particularly prescriptive on the subject, but the public will need some reassurance that we are taking the matter seriously in the long term.
I do not intend to take up more of the House’s time. I am grateful to the Secretary of State for exposing himself to this private grilling from the Opposition Front Bench as he has responded to the various questions asked. It is a rather uncharacteristic form of debate, but one that is probably very productive.
We wish the Bill well. We will try to ensure that it goes on the statute book in the course of this Parliament, and in a form that commands the widest possible acceptance.
I congratulate the Government on bringing forward this Bill. I have spent quite a number of years jumping up and down on these Benches to argue the case for legislation such as this, and it is good to see it before the House. I am pleased that it also has the support of the Opposition.
I want to begin by acknowledging the leadership given on this issue by Transparency International UK, and in particular the work done by Graham Rodmell, who worked for the organisation for a decade or so, lobbying this place and advising both me and the all-party panel on transnational bribery on the issues involved. I should also mention the leadership that the present executive director of Transparency International UK, Chandrashekhar Krishnan, has provided.
Transparency International UK sent a brief to Members in advance of this debate. It states that the organisation
“has been urging for a dozen years the enactment of new, effective anti-bribery legislation.”
I have been working with it over that period of time, and in 1998 I introduced under the ten-minute rule an International Bribery and Corruption Bill. It sought to incorporate the then very new EU and OECD conventions against bribery into UK law.
I am interested to hear about all the work that the hon. Gentleman has been doing on the issue over the past few years, but how much direct interaction has he had with small and medium-sized British businesses that are trying to export to Africa? Has he taken the opportunity to find out for himself the difficult circumstances that they face?
Indeed I have. Attitudes have changed over the decade or longer in which I have taken an interest in the issue. Ten years ago, quite a number of businesses shrugged their shoulders and said that the practice was unpleasant and costly but necessary if they wanted to do business in certain markets, but we are now in a situation in which all the main business organisations are absolutely clear that the United Kingdom, like other developed western economies, needs to take a stand against bribery.
When I introduced my ten-minute Bill 12 years ago, I quoted Adair Turner, the then director general of the CBI, who had said:
“Corruption’s become a big issue because it just costs business so much these days.”
He was in the vanguard, as many people in the business community at that time did not share his view that something had to be done about the problem. However, attitudes have changed, because in countries with endemic corruption, the Mr. Five Per Cent. became the Mr. Ten Per Cent., and then the Mr. Twenty Per Cent. and the Mr. Twenty-five Per Cent. It became quite impossible to do business in such circumstances.
I agreed with the hon. Gentleman’s important point that if we in the UK sign up to high standards in this area, our main competitors need to do the same. However, as the hon. and learned Member for Beaconsfield (Mr. Grieve) said, compared with many countries, we appear to be behind the pack rather than in the lead. The United States introduced the Foreign Corrupt Practices Act some 30 years ago under the Carter Administration. An American business man is prosecuted once or twice a year—it is not a vendetta in any sense—which keeps the issue in the mind of the American public. International bribery is just not acceptable in US business. France introduced legislation to make itself fully compliant with the OECD convention some years ago, and it has a longer track record of successfully prosecuting such offences than the United Kingdom. It is important that we ensure that all major western economies and OECD countries comply, but we would be in a stronger position to achieve that if we were a country with the best kind of such legislation and a strong record of applying it and enforcing it through the courts, when necessary.
When I introduced my ten-minute Bill, I said that there was a comfortable but completely fictitious belief that bribery was not a serious problem in the United Kingdom but was something that affected developing countries such as Nigeria, Pakistan or Zaire, as the Democratic Republic of the Congo used to be called—I know that the hon. Member for Shrewsbury and Atcham (Daniel Kawczynski) has worked in such countries as a businessman. However, the problem is that it takes two to tango, and if a corrupt public official in a developing country is demanding a bribe before signing a contract, there must be a bribe-giver, and that person often acts on behalf of a western corporation seeking to sell in that foreign market.
When I introduced my Bill 12 years ago, the hon. Member for Lichfield (Michael Fabricant) spoke against it, as he was entitled to do under the ten-minute rule. He called it “fundamentally naive” and made the point, which has been echoed in today’s debate, that if tough legislation is adopted in the United Kingdom but not in other countries, UK businesses will be put at a competitive disadvantage. However, we have discussed that issue, and it is now time for the UK to catch up while continuing to be vigilant so that we ensure that other countries also comply.
The hon. Gentleman, like me, is a member of the International Development Committee. He talks about OECD countries, but what about China and some of its conduct in Africa when huge sums are poured in for infrastructure projects in return for oil? Does he think that we can encourage the Chinese to regulate that practice, because their conduct distorts the market in itself?
It would not be a sensible national business strategy if we tried to create markets for our companies by out-bribing the Chinese. We need to bring China into more of the international organisations. For example, it recently joined the World Trade Organisation, since when Chinese business practices have changed significantly. I look forward to the day when China joins the OECD. Perhaps that is not so far away, because it is beginning to work with the organisation, including on this issue. We must make progress towards a better world, rather than falling back into a dog-eat-dog, 18th-century mercantilism through which we all try to obtain a trade advantage by cheating better than other countries.
May I say to the hon. Gentleman how much I agree with everything he is saying? I pay tribute to his role in bringing about such legislation. He might recall that I had a go when I promoted a Bill that had been passed by another place, yet made no progress.
Given that other countries have been ahead of ours on putting in place such legislation, I cannot understand why there was such delay on the part of the Government. Can the hon. Gentleman throw any light on why the Government have dragged their feet for so long when it is transparently necessary that we bring the UK into line with its treaty obligations and other civilised countries throughout the world?
I pay tribute to the hon. Gentleman for his interest in the issue and the importance of the Bill that he brought from the other place. Of course, I cannot answer on behalf of the Government. I have carried out a large part of my activity in the area since I left government. I have held many meetings with Government Ministers, however, sometimes on a one-to-one basis and other times on a cross-party basis. I have also met officials from the Home Office, the Department for Business, Innovation and Skills and the former Department of Trade and Industry, and the Law Officers. I think that they have, quite genuinely, been trying to craft legislation that will build a broad consensus among the voluntary bodies that take an interest in the issue, such as Transparency International and Corner House, and across the business community, who are the people at the front line who will have to deal with any legislation. Of course, there has also been consultation with the judiciary, the Serious Fraud Office and other parties. The process has been difficult.
In 2001, fairly soon after the OECD and the EU adopted their conventions, the Government introduced provisions as part of the Anti-terrorism, Crime and Security Act 2001which, for the first time in UK law, made trans-national bribery an offence. It had hitherto been seen as not just a legal but an acceptable and, in some cases, a tax-deductible business practice. So the Government acted relatively quickly—more quickly than those of some other OECD countries—to make trans-national bribery an offence in UK law, in pursuance of the requirements of the OECD convention.
In 2003 the Government consulted more widely on a draft anti-corruption Bill, which was considered by a Joint Committee of both Houses and roundly criticised by the Committee, principally because it retained the existing agent/principal relationship to define bribery. As a result of that criticism, the Government went back to the drawing board and asked the Law Commission to study the issue not once, but twice, and consulted widely on the findings.
The process has been a long one, as the hon. Member for Somerton and Frome (Mr. Heath) observed and as the hon. and learned Member for Beaconsfield said from the Dispatch Box, but the conclusion is a Bill that is fundamentally sound and fit for purpose. We may argue about clause 13 and the exemption of the security services and the armed forces from some of the provisions—I shall say more about that—but I agree with what the Lord Chancellor and the hon. and learned Member for Beaconsfield said: if, in the relatively short time available, we find that we are unable to dot all the i’s and cross all the t’s, we must not allow that to be a reason why legislation that is extremely necessary and has been very long in coming should not receive Royal Assent before a general election.
Such legislation is not at the top of the list of any Cabinet when it debates what legislation to introduce. Year after year it has been pushed back because other legislation was deemed more politically necessary and more pressing by the Government of the day. Whoever the Government are after the next election—I believe it will be a Government of the same flavour as we have now—there will be the same temptations in a first Session not to bring forward such a Bill. Let us seize the opportunity that we have now. The Bill has been through the other House. Let us get it through this House, after due scrutiny in Committee, and on to the statute book.
I thank Ministers from many different Departments who have met me over the years to discuss the issue. I thank colleagues from all parties who helped to produce “The Other Side of the Coin: The UK and Corruption in Africa”, a report that was produced four years ago by the Africa all-party parliamentary group. It made a series of recommendations, to which the Government responded favourably. The Prime Minister considered the report and responded at great length—15 or 20 pages. He responded positively to the group’s second recommendation, which was:
“Bring to Parliament before the end of 2006 a new Anti-Corruption Bill which addresses the concerns raised about the 2003 draft Bill by the Joint Parliamentary Committee and the OECD Phase Two Review.”
Well, the Government have got there and I congratulate them. The Prime Minister responded by saying:
“The Government remains committed to introducing a Bill in due course”,
and now the Bill is here.
The all-party group made some other recommendations which were more speedily implemented. One was to create an anti-corruption champion in the Government, which they did. It was initially the Secretary of State for International Development, then the post moved to the then Department of Trade and Industry. It is now where it probably should be, within the Ministry of Justice. I hope the post is retained to make sure that we get legislation on the statute book and that it is fully implemented.
We also made the point that similar legislation is needed in Crown dependencies and overseas territories. We cannot legislate for that as part of the Bill, because those jurisdictions have their own legislative powers, but it is important that once we can prove that we have achieved what the OECD requires and have a new Bill on the statute book, we have further discussions with dependent territories to ensure that they, too, follow best practice. The good reputation of the United Kingdom is at stake, because they are rightly seen as dependent territories of this country.
The hon. Gentleman says that at some stage in the future the Government should have discussions with the overseas and dependent territories so that they have a broadly similar approach to ours, but surely that should be done at the same time. Companies that are concerned about the legislation and wish to continue their former practices could simply leave the United Kingdom and base themselves in one of the overseas territories.
Some companies remain in the United Kingdom and conduct business offshore. The hon. Gentleman raises an important issue. He should join our Committee and champion the cause, but let us not fail to do the right thing ourselves because others are moving more slowly. We need to get the Bill on the statute book. Then we will be in a much stronger position to talk to other jurisdictions and persuade them of the necessity for them to introduce similar legislation.
I should like to make one or two comments on the Bill. In clause 10, the Government propose that the Attorney-General should give up his powers to consent to a prosecution. That is a fundamentally good thing for the Government to do. In the other place Lord Henley queried why the role of the Attorney-General was being so reduced. I do not think that is the case, but it is a good thing that he or she should give up the power. Bribery is an area in which there should not be political influence or even the appearance of political influence. There was great controversy when the Attorney-General advised the director of the Serious Fraud Office that it would not be in the public interest to proceed with a prosecution of British Aerospace. That attracted a great deal of criticism at home and abroad, and there was the suspicion that that was a political decision and that the issues of national security were not as compelling as the Attorney-General had suggested.
I do not know what those issues of national security were, nor I suspect does any other Member here, given that the Secretary of State for Justice and Lord Chancellor is not present at the moment. Of course, I may be wrong and the Under-Secretary of State for Justice, my hon. Friend the hon. Member for Watford (Claire Ward), may be fully apprised of the issues in the BAE Systems case. Perhaps there were good reasons why it would not have been in the national interest to prosecute, but the determination was made by a political appointee who attends Cabinet meetings when legal advice is sought, and that allowed people to make the accusation of political interference with the justice system. It is much better to have a paid professional, with tenure and an appointment, making those decisions, and I hope that there is no change to clause 10.
On clause 13, there are circumstances in which our intelligence services, security services and, indeed, military personnel on active service have to provide financial or other inducements, ugly though that may be, to safeguard the security of citizens in this country and, possibly, their own security. The Bill rightly includes an exemption to remove from those who are fighting for our security the threat of prosecution. However, I should not like to see any mission creep, through the defence that will be available to an intelligence officer who seeks important information being used by somebody who procures equipment for our armed forces but resorts to bribery claiming, “This is necessary to provide the best equipment, or a delivery date at the appropriate time, for our forces in the field.”
If we allow bribery to play a part in procurement for our armed and security forces, we will undermine our security, because a bribe increases the cost of one’s purchases. Some years ago in Pakistan, an admiral was put on trial for spending $540 million on submarines that were worth less than half that figure. The difference of course was the bribe, which he required to sign the contract. If we allow bribery into our procurement system, we increase the costs of the things that we procure and thus reduce the equipment that is available to, and undermine the effectiveness of, our defence or security forces. Importantly, therefore, we must ensure that there is no creep in the scope of the defence in clause 13.
In response to my intervention, my right hon. Friend the Lord Chancellor said that there was no intention to broaden the scope of the clause, and I accept that. He said that the exemption from prosecution of defence equipment procurement under the clause was not just unlikely but wholly improbable, which is a pretty strong reassurance that the Government have no intention of using the clause in that way. I hope that the issue will be discussed further in Committee or, possibly, on Report in order to put more flesh on the bones, because we must send a clear signal to the public and public officials involved in procurement for the armed or security services that the defence that is necessarily in the Bill for certain purposes will not cover defence procurement by any such public official.
I want the Bill to go through. It clearly has all-party support, and with a fair wind it will be on the statute book before the general election. However, looking beyond that, I say to the Government Front-Bench team that once the legislation is on the statute book, good use must be made of it. I am concerned that the Serious Fraud Office, the main investigating and prosecuting agency, does not have sufficient resources to investigate the cases that are reported to it, because of a reporting procedure that was set up in response to the Africa all-party parliamentary group’s report. Budgets are tight, but the enforcement of this law is important, and I hope that the Government will ensure that the SFO has sufficient resources to implement it once it has been passed.
It is important to maintain the post of anti-corruption champion within the Government, and I hope that in the Opposition’s winding-up speech we receive an assurance of that—in the unlikely circumstances of a change of Government. I should like the champion to report to Parliament, perhaps through a written ministerial statement from time to time, on the performance of the legal process in ensuring compliance with the OECD and EU conventions.
I should like also to see some work with the business community—the CBI and others—to ensure that British business men fully understand the change in the law. I do not want to see dozens of them being taken to court, fined or made to pay a compensatory payment in place of a prosecution. I just want business practice changed, and that is why the Government should work with business to ensure compliance with the law.
The legislation is necessary because bribes add to procurement costs. In private businesses that procure goods, it hits the profit line, and in government it adds to costs without improving public services. It is a problem at home and abroad. Despite the long gestation period, I am delighted that the Government have brought forward this legislation. I shall support it, and I hope that it proceeds swiftly through Committee, back to the Floor of the House and on to the statute book.
I, too, welcome the Bill. I pay tribute to the hon. Member for City of York (Hugh Bayley) for his work over the years in bringing us to this point, and to my hon. Friend the Member for Somerton and Frome (Mr. Heath) for his sterling efforts.
In light of what the Secretary of State and the hon. and learned Member for Beaconsfield (Mr. Grieve) said about the late Mr. Michael Foot at the start of their speeches, I should like to share their tributes. He was a very distinguished member of a very great west country radical family, even though his most famous political insult was aimed at the leader of the party that many other members of his family had served for many years. He said of David Steel, in that 1979 debate to which the hon. and learned Gentleman referred, that he had
“passed from rising hope to elder statesman without any intervening period whatsoever.”—[Official Report, 28 March 1979; Vol. 965, c. 577.]
He will be sadly missed.
As the Secretary of State said, the Bill reforms and clarifies the law on bribery in several important ways. I shall not go through them all, but it is important to realise that the Bill removes many uncertainties in the present complicated mixture of statute and common law. It removes the complications about the relevance or non-relevance of “principal” and “agent”, and those created by the legislation’s use of the vague word “corruptly”. Importantly, we now have clear definitions; we have a concentration on business and the state and a clear definition of when companies will be held responsible for bribery undertaken by people who are associated with them, including their employees. I understand that the Conservatives have some difficulty with clause 7, but I do not; I think that it is well done, and I hope that it continues its passage unaffected.
Importantly, we now have a separate and clear offence of bribing a foreign official. That is a development of immense significance.
I am glad to have that clarification. That is a significant step forward by the Conservatives from the position put forward at least by their Back Benchers in the other place. If the issue is now only about the content of the guidance, we have made considerable progress, and I welcome that.
The specific offence of bribing a foreign official is of immense importance in the fight against corruption, especially in developing countries. As hon. Members on both sides of the House have implied, there is a clear link between corruption and poverty. To see that link, one need only go to the examples of cases under the existing law. The Mabey and Johnson case, which was settled last year, involved millions of pounds in bribes paid by an infrastructure company in third world countries such as Jamaica and Ghana, with accusations relating to a country as poor as Papua New Guinea. It ended up with those countries spending tens of millions of pounds on projects that they could ill afford as a result of bribery. Countries that could not afford to waste a penny ended up wasting millions.
It is clear from the BAE cases that there is a similar problem. Obviously, I cannot go into the detail of the cases that are subject to the injunction that was successfully applied for overnight, so I cannot talk about the South African or eastern European cases. The hon. Member for City of York has already mentioned the Saudi Arabian case. However, we can mention the Tanzanian case, where there is no dispute about what the problem was. In that case, there was a £28 million contract for a military air traffic control system, and a third of that money disappeared into offshore accounts. The problem was not only that the system was out of date and did not work very well, but that it was a military system for a country that did not even have an air force and could have bought a far cheaper and better civilian system. What happened as a result was not only a matter of concern for the public authorities here but of immense concern as regards the waste of resources in a very poor country.
I should add my voice to those who have pointed out that this goes beyond the problem of corruption and the wasting of resources in individual cases. Systematic corruption undermines the market economy in general. A country where bribes are regularly asked for and given is one where, ultimately, economic confidence will collapse and international investment will become very difficult. The problem requires international action in the developed world. The money for corruption comes from companies in the western world, but those companies lobby against legislative action. They say, “Jobs are at stake” or “If we don’t do it, someone else will.” That is precisely why we have the OECD convention and international co-ordination.
As we heard during the speech by the hon. Member for City of York, the problem is not that Britain is forging ahead and other countries are not doing anything, but quite the opposite. This country has come under pressure from the OECD to improve its performance. In 2008, the OECD said that
“current UK legislation makes it very difficult for prosecutors to bring an effective case against a company”.
Other concerns have emerged in the light of the BAE cases.
I do not want to go into the detail of that case, because it is now subject to the injunction that I mentioned. BAE has never admitted to corruption—to bribery—and only to technical offences under other legislation. The same is true in the United States. That is because the current legislation has deficiencies that the prosecutors say need correcting to improve the situation.
Thank you, Mr. Deputy Speaker. I was trying to skirt around it as well as I could, but you are absolutely right: we cannot get any further into that without straying into an area where we should not go.
It is good that the Government have got this far with the Bill despite all the lobbying and pressure over the years, but it comes very late in the day. There is a risk, given how far we are into the Parliament, that it will not make it on to the statute book before the end of the Parliament. I hope that that is not its fate and that we are able to get it fully into law very quickly.
There are still some problems that we should discuss in Committee to try to find ways through them. One of those is to do with the role of the Attorney-General. The hon. Member for City of York is right that the Bill removes the consent power of the Attorney-General and transfers it to the directors of the Serious Fraud Office and the Director of Public Prosecutions. That is an advance, and a very good thing, for the reasons that he gave: there should not be political interference in such prosecutions. The OECD is on record as saying that it is worried about the lack of independence in our system. However, the problem remains at a slightly different level. Because the role of the Attorney-General was not reformed during the passage of the Constitutional Reform and Governance Bill, which had its Third Reading yesterday, the Attorney-General retains, despite what is in the Bribery Bill, a power of superintendence over the directors, and that power could be used in a politically motivated way. We still need to go further to protect the directors from that possibility.
The hon. and learned Member for Beaconsfield was worried about what would happen to accountability if we did go further, because if the roles were separated out entirely, the Government would be able only to issue public guidance to the prosecutors, and unable to influence individual cases. If an individual case were decided in a particular way—to prosecute or not to prosecute—the Attorney-General would be able to say in this House, “I’ve given guidance, but it’s not up to me to decide how to apply it in a particular case.” That is a problem, but to leave the situation as it is, as the hon. and learned Gentleman suggested, would not be a solution. He gave the impression that the Law Officers—the Attorney-General and the Solicitor-General—already have a proper degree of accountability in this House for that sort of decision, but that is not so.
The hon. Member for City of York mentioned the BAE case—the al-Yamamah case—where the previous director of the SFO took the decision not to continue with an investigation. We can see from the correspondence that was published as part of the court cases that the decision was taken under immense pressure from Ministers, from the Prime Minister downwards, but what technically happened was that the director himself eventually took the decision. When it came to the debates in this House and the other place, the Law Officers therefore said, “But we didn’t do it. We take responsibility for the letters that we wrote, but it was not our decision in the end.” Even in the existing system, that degree of accountability is not in place, so we cannot stay where we are.
The hon. and learned Gentleman rightly mentioned the missing clauses of the Bill about parliamentary privilege. I understand why the Government have placed that in the “too difficult” box, but there is a connection between what happens in this House under parliamentary privilege and the powers and responsibilities of the Law Officers. We have to get that sorted out completely at some stage.
Since we are all agreeing so much, I do not want to say much more, but I do wish to mention the problems that have been raised in relation to clause 13. The original exemption for the armed forces, law enforcement and the secret services was too wide, and I am grateful to the Government for the removal at least of the exemption for law enforcement. However, there are still some problems, one of which was identified in Justice questions by my hon. Friend the Member for Birmingham, Yardley (John Hemming). He pointed out the anomaly that, as clause 13 stands, it will be lawful for a secret service official, in particular, to bribe an official of the French Government but not one of the Scottish Government. That cannot be right.
More serious is the breadth of the immunity given to the secret services in clause 13. Like other hon. Members, I accept that there is a need for some protection, but it is important to remember that our secret services are charged with protecting not just national security but economic welfare. In that regard, it does not seem satisfactory to say, as the Secretary of State did, that it is all very complicated because there are overlaps between the various responsibilities. That does not work as an argument, because all that we need is for one of them to be protected. The problem with the existing draft of the clause is that when the only function being exercised is the economic one, without any overlap, it is entirely possible that that will be sufficient to attract immunity. I would prefer to preclude that possibility, for precisely the reasons that the hon. Member for City of York mentioned. We need to preclude completely any possibility of the clause being used as cover for any sort of arms supply. I suppose that there is an outside possibility of the armed forces provision being used in that way as well.
I wish to mention a problem with clause 13 that I do not believe has been brought up so far. It has so far been discussed in the context of the giving of bribes by the secret services or the armed forces, and one can see the arguments for that. However, it will also protect them from the effect of clause 2, which is about receiving bribes. Clause 2 was not properly discussed in the other place, so we have not yet heard a proper explanation as to why it is necessary for there to be a general legal protection on receiving bribes and for what purpose it is a good idea for our armed forces to accept bribes. I ask the Government to consider that in Committee.
This is a good Bill, although it needs some more tightening. I am happy to say to the Government that we will support them in any amendments that tighten it, and in resisting any attempts to loosen it. I wish to end, as the hon. Member for City of York did, on money. Improving the law is a very good thing, but the law by itself is not the same as an effective policy. For that, it is necessary for the authorities that are charged with the responsibility of enforcing the law to have the resources that they require. This might be wrong, but I am informed that for the past 12 to 18 months, the Serious Fraud Office has received not one penny from the Treasury for its anti-corruption work, and is transferring money internally from its anti-fraud work to its anti-corruption work. That is not satisfactory, and I want an assurance from the Government that the SFO and all the relevant authorities have the Government’s real backing, not just through the changes to the law in this excellent Bill but through providing the resources that they need to do their job.
I apologise to you, Mr. Deputy Speaker, and to the House for not having been here at the start of the debate. I was held up with some constituents.
I start by applauding British exporters for the tremendous work that they do around the world. There are many men and women who have set themselves up in business and who help with our balance of payments deficit by finding new markets overseas and navigating difficult red tape and bureaucracy in doing so. I spent 10 years of my life exporting British goods abroad, and I enjoyed it greatly. Unfortunately, we are not exporting as much as we should be, and we have a huge trade deficit, as all Members are aware.
My favourite expression in politics is that business is the workhorse that pulls the social welfare cart, and I am always slightly concerned about more legislation interfering with people’s ability to do their job. I say unequivocally at the outset that I am very much anti-bribery and applaud the cross-party consensus that bribery is wrong. It frustrated me greatly in my career exporting to Africa, and I am pleased that we are taking action. However, I will be concerned if we are gold-plating the Bill and moving further and quicker than some of our European partners or other countries, to which I shall come a little later.
We are not a nation populated by people who bribe. I disagree very much with the hon. Member for Cambridge (David Howarth), who says that the only reason why we are legislating is that the OECD is twisting our arm. In my experience of exporting to Africa and the middle east, I always found my fellow British business people and other British companies to be arguably the least likely to bribe. It is inherent in the nature of the British character to play fair and play by the Queensbury rules. That may sound rather old-fashioned, but it is the truth. We tend to behave appropriately overseas in our financial transactions, and I cannot say that about all the other foreign people whom I have come across when I have been competing against them in Africa and the middle east.
In the course of my 10 years, I never even considered giving a bribe, and I never knew anybody else in my company who did. However, I did come across aspects of bribery by the French, Germans and Italians. I am being told that those countries have since tightened their regulations, but have they? Will the Minister say how much the courts and Ministers in those countries are actually implementing those new regulations? I hope she can enlighten me on that and that she is working closely with the European Union to ensure that basic standards are applied throughout the EU.
I reiterate that I simply do not want British firms to suffer as a result of the Bill. We have been told that we are not allowed to talk too much about BAE Systems, so I will not, except to say that as chairman of the all-party Saudi Arabia group, I am extremely concerned at how the media sometimes tend to blow up out of all proportion various delicate issues that are intrinsic to our country without referring to anything specific. I hope that the media act more responsibly when reporting matters such as bribery, because such reports do tremendous damage to our relations with countries such as Saudi Arabia.
I feel passionately about exports to the Gulf states. I have spoken on many occasions with King Abdullah of Saudi Arabia about how to increase our exports to that country. He has informed me that the £5 billion-worth that we currently export is negligible in comparison with our European competitors. He is desperate for Britain to diversify trade with his country away from purely military components, and to increase bilateral trade. I am therefore a little bit worried. I have come here today to seek an assurance from the Minister that the Bill will not hamper British businesses that try to export.
I make no apologies for saying that British businesses are charged a great deal of money for using British embassies. British companies that want to use the British embassy in Riyadh are charged—I believe—more than £3,000, yet many of their competitors do not have to pay that to use their country’s embassies. There are not enough resources such as commercial attachés in our embassies to help our businesses to export. I spoke just this week with the Leader of the Opposition about the importance of a future Conservative Government, should we be elected, having a trade delegate—a representative of the Prime Minister—to the middle east.
The hon. Member for City of York (Hugh Bayley) said that he very much hopes that China will join the OECD, and that countries such as China and other developing nations will be bound by the new regulations and aspirations on bribery and the conduct of businesses and Governments. I hope the Minister and the Government discuss with China the possibility of it joining the OECD and do everything possible to encourage and help it to do so, because it is imperative that the Chinese behaviour in Africa is stopped.
I will never forget meeting the dictator of Sudan, President Omar al-Bashir, to talk to him about human rights abuses in Darfur and Sudan. Everywhere we went, there were all sorts of Chinese constructions. China was pouring massive amounts of money into Sudan to monopolise the market. While we are acting responsibly as a nation and refusing to trade with Sudan as long as those human rights atrocities are carried out, China basically monopolises the market to secure Sudanese oil, making it almost impossible for British businesses to secure business in the country. That is important.
Lastly, I reiterate what I said at the beginning of my speech on Government snooping. A lot of business people in my constituency say, “Look, the only reason we’re still here in Shropshire is that we feel passionately about our county. We’re thinking with our hearts rather than our minds, but if we were thinking with our minds, we would’ve shut up shop a long time ago and set up business in China, India or some other place where we do not face such huge levels of red tape, bureaucracy, interference and form filling.” I hope the Bill is not yet another example of more Government red tape and interference. There must be sufficient evidence before the appropriate body interferes and initiates cases against businesses.
I hope the Government are cognisant that British business is already desperately struggling to compete internationally in this very competitive globalised world. I do not want the Bill to hamstring them even more.
I add my respects to those of previous speakers on the death of Michael Foot, who was the dominant Labour personality when I first became involved in politics.
The quality of contributions to the debate has been high, and I congratulate the hon. Members for City of York (Hugh Bayley) and for Cambridge (David Howarth), and my hon. Friend the Member for Shrewsbury and Atcham (Daniel Kawczynski), on theirs. We are also thankful for the very productive format of allowing interventions that was offered by the Lord Chancellor in his initial remarks.
As my hon. and learned Friend the Member for Beaconsfield (Mr. Grieve) said, the Conservatives welcome this Bill and have been urging its introduction for many years. It was good to hear that all parties welcome it. It makes a refreshing change to speak on legislation that will not only reduce the number of the laws on the statute book, but update statute and case law, much of which is based on 19th century practice and in need of urgent upgrade.
International corruption is not acceptable in the modern age. We acknowledge, as the hon. Members for City of York and for Cambridge did, that it is now generally held that the UK has fallen behind the curve in dealing with bribery, and that our Transparency International corruption perception index is at all-time low. Conservatives believe that that needs urgently to be addressed.
Without doubt, the outstanding feature of the Bill has been the delay in its arrival. I believe that as far back as June 1998, the Government first published a paper on the consolidation and amendment of the Prevention of Corruption Acts. Although a draft Bill was first published by the Law Commission in March 1998, only now, more than a decade later—in the last throes of this Labour Government—are we finally seeing some action. Let us face it: things have been touch and go, as they will remain until the Bill is enacted.
The Law Commission submitted a reworked version of the draft Bill in March 2009, which has more or less been adopted. The commission deserves much praise for its work. The Bill was then scrutinised by the Joint Committee on Consolidation Bills, on which I was happy to serve under Lord Colville. The Committee was most unhappy that it was as time-constrained as it was. With adequate time, I have no doubt that we would have been better able to investigate the wider applications of the Bill as well as the law.
However, as I said, the Conservatives welcome the Bill. In particular, we are pleased that its implementation will finally make the UK compliant with the 1997 OECD anti-bribery convention. Accordingly, notwith- standing our unhappiness with the process, we shall support it on Second Reading. I like to think that reaching Second Reading has had something to do with the fact that we have called for the Bill for years. However, I suspect, as the hon. Member for Cambridge did, that the Bill’s progress has more to do with the US Department of Justice and the OECD putting significant pressure on the Government for Britain to comply with its international obligations.
The debates in the other place were thorough and informed. I am indebted to Lord Henley, and other noble Friends and Lords, whose experience has made an invaluable contribution. However, we will wish to raise in Committee a number of important issues that have arisen in today’s debate and debates in the other place.
One issue is that in a wide range of circumstances, the application and enforcement of the Bill will depend on the discretion of prosecutors. That was raised again and again in the other place and today. It needs to be recognised that that is a key concern of those looking for certainty, especially those in business. The position of business, and support for our exporters, was admirably advocated by my hon. Friend the Member for Shrewsbury and Atcham.
In many cases, we are not yet satisfied that the Government have fully tied down this issue and we will wish to discuss that more fully in Committee. The International Chamber of Commerce has provided the example of hospitality payments. On the one hand, the Government have recognised the importance to business of bona fide promotional expenditure, but on the other, the question of where a line should be drawn on this issue is still unclear. Indeed, there is continued uncertainty as to whether a line should be drawn at all. We were pleased to see that the requirement for guidance was made statutory in the other place. Guidance will doubtless be crucial to allow companies to understand what will be acceptable under the new laws. However, the problem is—the Government admitted as much in the other place—that there will always be borderline cases that may inadvertently fall within the definition of “bribery”. The difficulty for business is obvious. It is not correct to expect that businesses should instruct employees that a certain course of action, while theoretically falling foul of the legislation, may nevertheless proceed because prosecution is unlikely. The risk is that, in striving for a clear message in combating bribery, the effect of the Bill—if the guidance does not work—could actually be to confuse the situation yet further.
I was pleased to hear from the Lord Chancellor that consultation on the guidance is now well advanced. It will be important, when the Government produce the guidance, that business is consulted closely and allowed to contribute to its content. As my hon. and learned Friend the Member for Beaconsfield said, the guidance must clearly be in place prior to the offences becoming available. I was also pleased to hear the Lord Chancellor’s confirmation that that will be the case. The Government will also need to explain the position to business to help all concerned, and I would be grateful if the Minister, in her concluding remarks, could identify how the Government intend to do that.
A serious outcome of this possible ambiguity is a danger that UK companies could be disadvantaged compared to foreign competitors, as my hon. Friend the Member for Shrewsbury and Atcham said. For example, in the United States, a company can seek a public ruling from the Department of Justice in case of doubt regarding a payment. However, such a system has been rejected by the Government as being “inconsistent” with traditional practice. This argument was used by the Government several times in the other place, but I found it somewhat counter-productive and counter-intuitive. Indeed, the same argument could be used to say that the concept of “corruption” should be retained as the Bill’s use of “improper” conduct is also inconsistent with traditional practice. The fact is that this Bill is creating new law which will inevitably be tested in the courts, and we should just accept that and look to deal with the consequences of it—both intended and unintended.
It is also important that the issue of how the Bill will overlap with related legislation be considered in greater detail. Under the Bill, a company found to have engaged in bribery under clause 11(2) may be liable, if convicted on indictment, to an unlimited fine. Many businesses we have spoken to are worried that this will not be the end of the matter. Indeed, there are concerns that further action may be taken against companies under the proceeds of crime legislation. That legislation was designed to deprive individual defendants, particularly drug dealers and organised criminals, of the benefits of their criminal conduct. However, if companies convicted of bribery are fined were and then also caught by the proceeds of crime legislation, they will face serious financial penalties that could in some cases see them put out of business entirely. We will seek clarification in Committee on policy on this issue and on the use of the measures under this Bill and other existing legislation. To what extent will civil remedies be used? Does the existing legal framework support the desired use of plea bargaining? Will other laws hold up deals being made? Those are important issues—my hon. and learned Friend also raised many of them—and they should have been addressed much earlier in this Parliament.
Some prosecution issues will be of political importance, and we will wish to investigate whether the authority to prosecute should lie with the various directors specified in the Bill or, as colleagues in the other place maintained, remain with the Attorney-General. That point was addressed by the hon. Members for City of York and for Cambridge, who were keen to put the OECD’s position forward. But as others have noted, especially in the other place, that does not cater for the traditions of our own constitution. I am sure that further interesting debates will be had on this point. However, the Bill also raises various practical issues, such as which prosecutor should take the lead and in what circumstances. That remains unclear.
If the Bill is passed, the UK will have among the strictest bribery laws in the world. Consequently, we have been told that there is a real danger that UK businesses could be put at a competitive disadvantage when compared with international businesses whose domestic bribery laws will be less strict than our own. I have seen the rather flimsy anti-bribery strategy rushed out by the Lord Chancellor a few weeks ago, and I remain to be convinced that the Government understand how important this issue is. In that regard, the Minister needs to address the concerns of CAFOD, Transparency International, Tearfund and others, such as the hon. Members for City of York and for Cambridge, who are concerned to ensure that the Government intend to provide sufficient funds for the effective investigation and prosecution of bribery offences. As my hon. and learned Friend said, it is very important to ensure that the UK, in modernising its bribery laws, does not end up shooting itself in the foot in the way explained very clearly by my hon. Friend the Member for Shrewsbury and Atcham. That danger is that contracts will be lost because others bribe when we do not. To do this, serious pressure will need to be exerted on other countries to follow our lead and introduce tougher bribery laws of their own—and to enforce them.
We will wish therefore, in Committee, to review how the Government will make it a priority to put pressure on other countries to follow suit and strengthen their own bribery legislation. There are other international aspects to this, such as the EU procurement directive. The directive appears to be very rigid in that any company found to have been involved in instances of bribery must be permanently disqualified from the procurement process. Hon. Members will be able to see the problem with that. On the one hand, UK companies will be subject to the strictest bribery laws to be found anywhere in the world, but on the other, any company caught by these laws could be prevented from applying for procurement contracts. Companies are understandably very nervous about the huge impact of falling foul of the regulations, concerns that are compounded by the fact that many of the Bill’s provisions remain unclear and are reliant on guidance that has yet to appear.
By contrast, the position in the United States seems to be more flexible. Although disqualification provisions do apply, different degrees of sanctions for fault are recognised and, importantly, it is possible for such a debarment to be lifted after a period of time. Will the Minister explain the Government’s discussions with EU officials to determine what effect, if any, an offence under clause 7 of the Bill will have under the directive?
On a separate point, there is continued ambiguity on the issue of consortiums and businesses’ potential responsibility for the acts of their agents and “associated persons”. The issue was raised by the International Chamber of Commerce. It is often the nature of international businesses to operate in joint ventures. The point was raised in the other place that a company, even though it may have no control over a joint venture partner, may none the less be caught by the provisions of this Bill due to that partner’s conduct. Although the Government have attempted to explain away the problem by stating that the degree of control would be one of the circumstances to be taken into account when deciding whether an offence had been committed, it is not clear that that comfort would be effective in law.
The ICC has pointed out to us that the current wording in the Bill makes it clear that the circumstances that may be taken into account are those that are decisive for the question of whether services are being performed. Indeed, the relationship between the company and the associated entity is expressly excluded. This conflict gives rise to further uncertainty for business, and it is therefore evident that this question of businesses’ responsibility for the actions of such partners and agents needs to be resolved.
It is clear also from the contributions of the Lord Chancellor, the hon. Members for City of York and for Cambridge and my hon. and learned Friend that there are ongoing concerns about defences for intelligence services and our armed forces. As my hon. and learned Friend said, we were generally satisfied with the narrower definition agreed in the other place, but we will have to return to the matter in Committee.
There are evidently a number of outstanding issues that the House needs to address over the coming weeks. We certainly believe that it is a good Bill, but as I have indicated, there are areas of continued concern that will need to be reviewed. The tiny number of prosecutions to date for overseas bribery shows that our law in this area requires updating and enforcing, but in strengthening the UK’s bribery laws to combat corruption, it will be vital that the ability of UK companies fairly and legally to compete commercially and on the international stage is not impaired. That is the balance that we look to achieve over the coming weeks.
We have had an interesting debate with contributions from both sides of the House that in essence welcome this important piece of legislation. I welcome the fact that it has cross-party support, although no doubt in Committee there will be one or two differences of opinion. It is possibly best described, as it was in another place, as a love fest for all parties in support of the Bill. The Bill will provide modern and effective legislation to deal with bribery, whether committed at home or abroad. Its comprehensive scheme of bribery offences represents a formidable deterrent against bribery and is capable of meeting the challenges of today’s complex world of international commerce.
We understand that this matter can be difficult, but I want to respond initially to the hon. Member for Shrewsbury and Atcham (Daniel Kawczynski) and make the point that the UK’s reputation is strong. The UK is recognised as one of the least corrupt countries in the world. We are the joint 17th least corrupt out of 185 countries in Transparency International’s 2009 corruptions perceptions index, with British companies seen as cleaner than their French and American counterparts. We are also equal fifth least likely to pay bribes out of 22 countries in Transparency International’s 2008 bribe payers index. However, we must not be complacent about what happens in some companies and ensure that we continue to maintain a strong reputation. Once enacted, the Bill will enable us to do that.
Members on both sides of the House have raised a number of important points, some of which I would like to deal with now. I am confident, however, that those not picked up today will be dealt with in more detail in Committee; it appears that there will be ample opportunity to do so then. Initially, however, I wish to pay tribute to my hon. Friend the Member for City of York (Hugh Bayley) and his work in supporting a high level of commitment to achieving the highest standards of business and to ensuring that we remove opportunities for bribery and corruption. I join him in paying tribute to work of Transparency International, with which we have worked closely in developing the Bill.
Members have suggested that the Bill has had a long gestation period—even longer than an elephant’s—but it has the overwhelming support of both sides of the House and is much better than when it was first considered in its draft form. The problems with the initial proposals in 2007 meant that the Joint Committee could not accept much of the basic premise of the Bill, having to do with principals and agents, and that is why it had to be referred back to the Law Commission for further consideration. Its contribution has ensured that the Bill can, I believe, make it on to the statute book with all-party support.
Members have raised a number of issues, and I want to deal initially with the point about the Attorney-General and prosecutorial discretion. The hon. and learned Member for Beaconsfield (Mr. Grieve) was concerned about some aspects of that, and the hon. Member for Huntingdon (Mr. Djanogly) raised similar points. They asked how prosecutors would be guided in deciding whether to bring a prosecution for bribery and in ensuring that there is some understanding and certainty for business. Whether a case is dealt with by the Crown Prosecution Service or the Serious Fraud Office, all prosecutions are subject to review under the principles in the code for Crown prosecutors, which requires the prosecutor to apply an evidential and a public interest test.
Where there is sufficient evidence for a realistic prospect of conviction, prosecutors must consider whether a prosecution is required in the public interest. A prosecution will usually take place, unless the prosecutor is sure that public interest factors tending against prosecution outweigh those in favour, or that the public interest may properly be served by offering the offender the opportunity to have the matter dealt with through an out-of-court disposal. Each case must be considered on its own facts and merits, but the more serious the offence, the more likely it is that prosecution will be needed in the public interest.
The Minister will be aware that I highlighted the regulatory nature of the Bill. Clause 7 is entitled “Failure of commercial organisations to prevent bribery”. Earlier, I used the word “negligence”, but that probably was not strictly right. It is in fact a strict liability offence tempered by a defence, the burden of which is on the defendant to show that they had adequate procedures in place. As with the Health and Safety Executive, that places a great burden on the regulator or prosecutor in deciding where the public interest lies, particularly, for example, where it might consider that the company has made real efforts to improve its performance in this area.
And those issues must of course be a matter for the prosecution. Bribery is a serious offence, but in deciding whether to prosecute, prosecutors will take all those factors into account and weigh them appropriately. They might take into account whether the loss or harm can be described as minor; whether it was a single incident; whether it was a matter of misjudgment; or whether the offence was committed as a result of a genuine mistake or misunderstanding. The prosecution must consider all those factors before deciding whether to proceed.
Members have also mentioned the consequences of replacing the requirement for the Attorney-General’s consent to a prosecution under the Bill with that of the director of one of the prosecuting authorities. Clause 10 provides that responsibility for granting consent to a bribery prosecution will rest with the directors of the relevant prosecuting authorities. For offences under the Bill, we consider that to be the appropriate level at which such a judgment should be taken on the basis of what I have already said about the factors that they need to take into consideration. The Joint Committee agreed with our judgment.
We fully recognise the constitutional importance of the Attorney-General’s position and the need to maintain effective parliamentary accountability for the operation of the prosecution services, but the Attorney-General will continue to have a fundamental role in those matters. The protocol between the Attorney-General and the prosecuting authorities published last July sets out the circumstances in which the Attorney-General will be consulted and how the Attorney-General and directors will engage with one and other.
The protocol serves to underline the fact that the directors of the prosecuting authorities exercise their statutory functions under the superintendence of the Attorney-General, who is responsible to Parliament for those directors’ functions in relation to prosecutions. The Attorney-General is responsible in turn for safeguarding the independence of prosecutors in taking prosecuting decisions.
The hon. Member for Cambridge (David Howarth) asked whether there would still be opportunities for the Attorney-General to interfere, as he put it, in cases that involved national security. The only type of case in which the Attorney-General would consider directing that a prosecution not be started or not continue—or, in the case of the SFO, that an investigation not take place or not continue—would be one in which the Attorney-General was satisfied that it was necessary to do so for the purpose of safeguarding national security. Again, it is important to take the protocol into account.
When national security is under threat, the Government consider it right that the Attorney-General, having consulted other Ministers, should have the power to halt a prosecution or an investigation carried out by the Serious Fraud Office. It will be the Attorney-General—after consulting other Ministers—and not necessarily the prosecuting authorities who will have the significant relevant expertise in that area. The Government still expect most such cases to be settled by way of discussions between the Attorney-General and the relevant prosecutor. Only in rare cases would it be appropriate for the Attorney-General to give such a direction.
Without wishing to get into a discussion about a case that is still subject to the courts, I would say to the hon. Gentleman that we believe it appropriate, in those exceptional cases where it is a matter of national security, for the Attorney-General to have the ability to intervene where appropriate.
Let me turn now to facilitation payments. There was some discussion about the extent to which facilitation payments, of whatever size, large or small, would still be classed as bribery. The reality is that facilitation payments, no matter how big or small and no matter what they are called, still amount to bribery. We have not included an exemption for such payments, despite what might happen in the rest of the world, including in the US, under the Foreign Corrupt Practices Act. There is no exemption in our existing legislation for facilitation payments. The Joint Committee agreed that facilitation payments should continue to be criminalised, saying:
“A specific defence risks legitimising corruption at the thin end of the wedge.”
We share the Committee’s view that, in general, the Bill must prevent individuals from relying on local customs to justify corrupt practices or considering small facilitation payments to be appropriate.
Tackling petty bribery is a key element of changing the culture of corruption, which is so corrosive, particularly in developing economies. We recognise that many UK businesses still struggle with petty corruption in some markets, but the answer is to face the challenge head-on, rather than carve out exemptions that draw artificial distinctions, are difficult to enforce, and have the potential to be abused. Providing exemptions for facilitation payments, as the US does, is not a universally accepted practice, and not something that we consider acceptable.
The hon. and learned Member for Beaconsfield also talked about clause 10 and the amendment made in the other place. I am sure that we will return to that issue in Committee, but as my right hon. Friend the Justice Secretary set out in his opening statement, we will propose a further significant safeguard to address the concerns that were raised in the other place. We recognise the concerns about the use of the proposed defence, as well as those raised in this debate. We will propose that there should be a statutory duty on the heads of the intelligence services and the armed forces to ensure that appropriate arrangements are in place to ensure that conduct amounting to an offence under the Bill takes place only when the defence applies. Those arrangements would then be subject to approval by the relevant Secretary of State. That requirement will provide direct ministerial oversight of the internal arrangements put in place by the intelligence services and armed forces. For that reason—along with that given earlier by my right hon. Friend the Justice Secretary—we cannot accept clause 10 as amended in the other place.
The hon. and learned Gentleman and the hon. Member for Cambridge both referred to parliamentary privilege and the fact that it is not specifically mentioned in the Bill. It is common ground that MPs should not be above the criminal law. However, the Joint Committee on the draft Bribery Bill argued that any evidential problems in relation to bribery offences should be dealt with in a separate parliamentary privilege Bill. In the light of the Joint Committee’s conclusions, we decided against including provisions in the Bill on parliamentary privilege. Given the recent institution of criminal proceedings against three Members of this House, we believe it would be appropriate to wait and see what the court has to say in this matter before deciding whether to proceed with any further such legislation.
My right hon. Friend the Justice Secretary has given a good explanation of why we inserted a statutory requirement into the Bill in the other place to produce guidance in respect of the clause 7 offence. We understand that businesses are looking for better guidance and a little more detail on how such offences might apply. We have also given a commitment that such guidance will be in place before the Bill is enacted and the offence comes into play. We are in discussions with business and various industries on that guidance, but it is fair to say that many industries already have good governance arrangements and strong guidance in place. We look to work with a range of companies to find the best of that guidance and build on it. I trust that the hon. Member for Huntingdon will question me further on that in Committee.
The hon. Gentleman also asked whether the offence of failing to prevent bribery would trigger article 45 of the EU procurement directive, which requires the mandatory exclusion of suppliers for public procurement contracts for services, supplies and works. We are giving active consideration to whether conviction for the new corporate offence of failure to prevent bribery—the clause 7 offence—would require mandatory exclusion under the directive. That is not a straightforward issue, and there are a number of complex points that we need to consider. There is obviously a difference of view among European Union member states on how some aspects of the directive are being applied, but we will continue to look into the matter in further detail before coming to a view on it.
The hon. Gentleman also asked about the application of the failure to prevent bribery offence to the activities of joint ventures and similar corporate structures over which a company does not have full control. Our purpose is clear: to encourage all those involved in joint ventures and similar business structures to satisfy themselves that adequate procedures are built into their governance arrangements. An organisation will be convicted of an offence under clause 7 only if a person performing services on its behalf bribes another to obtain or retain business for that organisation. It is possible for one person or a number of people to perform services on behalf of more than one company. It will depend on the particular circumstances of the case, but it may be that a bribe by a person performing services for one company in a joint venture is rightly regarded as being paid in connection with the business of any of the companies involved in that venture. Equally, it may be the case that, on the facts, the necessary connections are not present to establish liability under clause 7 if a bribe is paid in the context of a joint venture. Ultimately, it will be a matter for the courts to determine where liability stands.
I trust that I have responded to most of the main points made by hon. Members in what I think has been a particularly good debate, in large measure because the Bill has backing and support across the House. I believe that we can, with commitment, get the Bill through the House, despite time pressures, and I trust that our opportunities to debate and consider further details in Committee will in no way hamper the Bill, which is essential to maintaining the UK’s credibility as a country at the forefront of fighting bribery and corruption. I commend the Bill to the House.
Question put and agreed to.
Bill accordingly read a Second time.
bribery bill [lords] (programme)
Motion made, and Question put forthwith (Standing Order No. 83A(7)),
That the following provisions shall apply to the Bribery Bill [Lords]:
1. The Bill shall be committed to a Public Bill Committee.
Proceedings in Public Bill Committee
2. Proceedings in the Public Bill Committee shall (so far as not previously concluded) be brought to a conclusion on Thursday 25 March 2010.
3. The Public Bill Committee shall have leave to sit twice on the first day on which it meets.
Consideration and Third Reading
4. Proceedings on consideration shall (so far as not previously concluded) be brought to a conclusion one hour before the moment of interruption on the day on which those proceedings are commenced.
5. Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion at the moment of interruption on that day.
6. Standing Order No. 83B (Programming committees) shall not apply to proceedings on consideration and Third Reading.
7. Any other proceedings on the Bill (including any proceedings on consideration of any message from the Lords) may be programmed.—(Mary Creagh.)
Question agreed to.
Business without Debate
Motion made, and Question put forthwith (Standing Order No. 118(6))