House of Lords
Wednesday, 7 March 2007.
The House met at three o’clock (Prayers having been read earlier at the Judicial Sitting by the Lord Bishop of Liverpool): the LORD SPEAKER on the Woolsack.
Carbon Emissions: Deforestation
My Lords, afforestation and reforestation projects in developing countries are eligible for crediting under the clean development mechanism. However, they cannot currently be traded for compliance purposes under the European Union Emissions Trading Scheme. This is now being examined as part of the review of the scheme. The United Kingdom is working with partners in international negotiations to find a solution that would also allow crediting of projects that seek to avoid deforestation.
My Lords, I thank the Minister for his Answer and am delighted to hear of the intention of the Government. However, given that deforestation accounts for nearly a quarter of global carbon emissions, does he not agree that conservation of the forests should be a priority in post-Kyoto agreements, especially in the light of the recommendations made by Sir Nicholas Stern? Will he convey to colleagues negotiating at the EU summit tomorrow the dismay of those people living on the continents of Africa, Asia and South America at how the European Union and the G8 countries seem so reluctant to do this?
My Lords, I am more than happy to pass on the remarks of the right reverend Prelate before the EU Council at the weekend. The Stern figure quoted by the right reverend Prelate is going up by the day. My brief states that the Stern review said that around 18 per cent of global greenhouse emissions come from deforestation. At lunchtime, I saw a paper saying that Stern said 20 per cent, while the right reverend Prelate has just referred to almost 25 per cent. In other words, the percentage is very substantial; we are talking about around a fifth of all greenhouse gas emissions. Nevertheless, we want to be positive and seek to include the avoidance of deforestation in future climate change agreements. This is not simple and certainly cannot be done within the EU’s emissions trading system at the present time.
My Lords, the noble Lord, Lord Truscott, has honoured his word and has written to me about the EU Emissions Trading Scheme following our debate on 8 February, and I have passed his letters on to a number of people who have expressed great interest in what he said. However, there is one matter that the noble Lord will recognise may cause some difficulty. I asked when clean coal technology would come within the EU Emissions Trading Scheme, and the noble Lord, Lord Truscott, said that it would not be until 2013. Why can we not bring clean coal into that scheme as soon as possible?
My Lords, I shall seek to have early discussions with my noble friend Lord Truscott about the answer to that question because I am not briefed on it. I am briefed as well as I am able on the developing world and forestry. Of course I realise that coal starts off as forest, and perhaps some would like to make the connection. Obviously there is a big benefit to everyone in clean coal technology. It is something that we can lead the world on in terms of selling our intellectual property rights and getting a benefit—indeed, a benefit for the planet and a benefit economically. I will check the particular dates to which the noble Lord referred.
My Lords, that is why this issue is much more complicated than simply a soundbite to make a populist argument. Chopping down forests to grow other trees to create biofuels—trees that may soak up less carbon—could have a negative effect on the planet. The simple answer of biofuels is not a simple answer. The issue is much more complicated than the President of the United States seems to understand.
My Lords, the European summit is coming up in the next two days, and the environment and the Emissions Trading Scheme will be top of the agenda. Key issues around that include forestry, but also national allocation plans and ensuring a positive price for carbon for the long term. What are the Government doing to advocate that strongly at this week’s summit?
My Lords, I will have to take advice on that. I understand that only one of the schemes that are part of the clean development mechanism has been registered as a forestry scheme. These are early days to try to get some kind of mechanism where one can capture carbon and have a credit. To go back to the original Question, it cannot be part of the European emissions trading system at present.
My Lords, the UK timber trade has told us that Britain’s sustainable timber procurement policy has been the single most important driver of change of behaviour in the UK private sector. We are aiming our procurement policies at the real problem of forest degradation and destruction, and avoiding gold-plating standards that countries with serious forest governance problems cannot hope to achieve in the short term. In other words, there is a beneficial effect, and the UK timber trade has informed us of that.
Yes, my Lords, but I pay tribute to the work of the right reverend Prelate on this issue, as would the whole House. This is a much wider issue. I fully accept that the concerns about what is happening to the planet’s forests are shared by everyone. Wrong emissions and destruction in one part of the planet affect everyone, which is why this is a global issue and should not be confined just to the EU; we have to get it internationalised.
Debt: Consumer Credit
My Lords, we hold many discussions with banks, building societies and credit card companies on a variety of issues in support of our goals of creating an open and competitive consumer credit market while minimising over-indebtedness. This includes regular meetings with Ministers and discussion with the advisory group on over-indebtedness, as detailed in the Government’s Tackling Over-Indebtedness: Annual Report 2006.
My Lords, is the Minister aware that during the passage of the Consumer Credit Act 2005 I twice moved a simple amendment requiring loan providers to see that debtors had some means of meeting their new obligations? In the light of the recent especially high rate of insolvencies and repossessions, do the Government now think they were wrong to reject my modest amendment? What are they going to do to remedy this most appalling position that so many people find themselves in today?
My Lords, the noble Baroness took an active part in the passage of that Act but, ultimately, it was a decision for your Lordships' House and the other place. In association with the Financial Services Authority, the Government have a national strategy for financial capability, which will reach 10 million people and help them with money management. The Treasury has commissioned work in developing financial capability further. We are spending more than £47 million on a debt advice project, and the DWP is rolling out £36 million in a growth fund to increase access to credit unions. We are taking in hand other matters to deal with indebtedness. It is a serious issue, and we are taking steps to ensure that lenders are responsible when they lend to people.
My Lords, will my noble friend recognise more fully the public interest points that the noble Baroness raised? Does he agree that the grasping attitude of some of the organisations referred to in the Question suggests that competitiveness, which the Government strive for in every aspect of business, is not very successful in the banking world when unduly high profits are made, to the detriment of the consumer?
My Lords, my noble friend has a valid point; I will take on board what both he and the noble Baroness have said. The Government are ensuring that lenders take a responsible approach, and the consumer credit reforms will help in that respect. For example, regulations will make consumer credit advertising clearer and fairer. We have introduced pre-contract information to help consumers become better informed before entering into a credit agreement. The Consumer Credit Act 2006 also strengthens the existing consumer credit licensing regime, which will ensure that the OFT can take into account irresponsible lending practices when considering who should hold a consumer credit licence.
My Lords, with Britain’s personal debt increasing by £1 million every four minutes, it is right for the Minister to be as concerned as he is, and I am delighted to hear what he is doing to help prevent the problem worsening. What is he doing to prevent the unethical marketing of individual voluntary agreements? Will he support the Conservatives’ calls on the Advertising Standards Authority to enforce the rules governing the marketing of IVAs more rigorously than at present?
My Lords, the noble Baroness makes a fair point. We are taking action on individual voluntary agreements. A very small proportion of individuals obtaining credit have difficulties. IVAs are not sold; they are contracts between debtors and creditors, which must be approved by 75 per cent in value of those creditors. IVAs can be administered only by licensed insolvency practitioners, who are subject to stringent regulation. As the noble Baroness said, there have been concerns about the quality of the advertising of IVAs. The OFT has recently taken action and written to 17 IVA providers regarding areas that it feels require attention.
My Lords, does the Minister accept that this is a classic area where prevention is better than cure? Can he update the House on the Thoresen review and indicate when the Government expect to put in place a proper national system of consumer advice on financial matters, rather than the series of piecemeal initiatives we have had to date?
My Lords, I will write to the noble Lord with details of the Thoresen review. I have already outlined the considerable steps the Government are taking to ensure that there is proper advice for people in debt. Only a minority of people get into serious debt—something like 1 per cent of all borrowers. Nevertheless, we are taking a number of measures, including providing the National Debtline to give advice, to which the DTI alone is giving £1 million per annum.
My Lords, noble Lords on all sides of the House are concerned about the problems that many people are now encountering with loans that they have taken out. Given the massive profits that we have seen banks receive recently, will the Minister consider having discussions with the Opposition and the Liberal Democrats about the possibility of all parties coming together to agree the reintroduction of windfall taxes?
My Lords, my noble friend makes an interesting point but, to be frank, I do not think that that is on the cards. There are no plans to go down that road. Indebtedness is a problem, but one of the major drivers of indebtedness is unemployment. I am glad to say that, under this Government, we no longer have mass unemployment; we have record levels of employment, which assists people greatly in the financial sphere.
Health: Hospital Cleanliness
My Lords, every NHS trust must show that it meets the national specifications as part of the Healthcare Commission's annual health check. Trusts must declare themselves non-compliant if there has been a significant lapse from those standards.
My Lords, I am grateful to the Minister for that response. I declare an interest as my company provides specialist insurances to the cleaning industry. We all appreciate that there are problems relating to hospital cleanliness. Does the Minister support the conclusions of the recent Patient Environment Action Team survey, which shows a better performance from contracted-out cleaning services?
My Lords, the comparison of in-house services and outsourced services has been discussed by noble Lords on a number of occasions. I have not seen any hard evidence to suggest that a decision to outsource services has a direct impact on the quality of cleaning. Ultimately, it depends on the nature of the contract in relation to outsourced services or the nature of management in relation to in-house services. The key factor is leadership. When NHS trusts give a clear indication that cleanliness is a high priority, good services follow from it.
My Lords, there is much to be learnt from other countries, as other countries have much to learn from us. MRSA is much less prevalent in Holland compared with this country. Therefore, some of the measures that the Dutch are able to take are not practical for this country. But the latest figures show that we are starting to see a reduction in MRSA infections. We have set a tough target to reduce infections by 50 per cent by 2008 and we are determined to keep up the pressure on the NHS to do just that.
My Lords, has the Minister visited the Florence Nightingale Museum across the river in St Thomas's Hospital, where he can purchase a book entitled Notes on Nursing written by the great lady? The implementation of those recommendations saved many thousands of lives in the 19th century. When will he make it obligatory reading for everyone who works in the health service?
My Lords, I have not had the pleasure of visiting the museum, although I have visited St Thomas's Hospital many times. The noble Baroness makes a good point. I am sure that if we were to go on to discuss the issue, one thing that would come through is nurse leadership. It is abundantly clear that where modern matrons and ward sisters make it their business to ensure that their wards are clean and that the cleaners—whether employed directly or by contract companies—are part of the team, cleanliness follows. I very much endorse the sentiments behind her question.
My Lords, although every effort to keep a hospital clean is greatly to be recommended and commended, does my noble friend agree that there is very little evidence that the organisms mentioned, and Clostridium difficile, have any relationship to dirt in hospitals and that cleaning hospitals is not the issue when dealing with, for example, MRSA?
My Lords, my noble friend is right to suggest that there is no direct causal relationship between general cleanliness and the incidence of MRSA or C. difficile. However, a hospital that in general takes cleanliness seriously is, I think, much more likely to take the issues of MRSA and C. difficile seriously. Patients expect hospitals to be clean. The clear evidence is that there has been tremendous improvement in cleanliness standards. Of course, there is more to be done, but we should acknowledge the efforts made by the NHS in the past few years.
My Lords, the essential difference between the Dutch approach and the UK approach—there are similarities—is that in this country, many people carry MRSA, whereas in Holland far fewer do. It is much more practical for Dutch hospitals to take preventive measures than it is for hospitals in this country, in terms of the number of people who can be isolated and the facilities that they have. However, with the development of more isolation facilities, we see huge improvements in the way in which NHS hospitals deal with these matters. On MRSA, the hand-washing regimes and the collaboration between bed managers and infection controls teams means that we are beginning to see a downturn in the number of serious infections. We shall redouble our efforts to gain further improvements in the next few years.
My Lords, it is time to hear from the Cross Benches.
My Lords, I am a food producer and before I even think about producing any cheese, I ensure that I am clean, that my premises are clean and that my equipment is clean—by clean, I mean spotlessly clean. The food industry has done wonders in reducing the amount of food poisoning over the past few years by improving cleanliness standards. Could not the National Health Service learn something from the environmental health inspectors—and others in the food industry—who are doing so well?
My Lords, I am sure that that is an excellent suggestion, but we must not forget that in the past few years, the NHS has improved appreciably the standards of cleanliness and the resources that have been put into cleaning. Of course, we cannot be complacent, but the independent service self-assessment has shown that, in general, standards of cleanliness are improving and have improved. I expect and hope that they will continue to improve.
Schools: Allocation of Places
My Lords, this is a matter for the local authority after local consultation. It is a cardinal principle of admissions law that parents’ expression of a preference for a school should, where possible, be honoured. In case of oversubscription, there are a number of permissible criteria for allocating places fairly. Brighton’s policy is for siblings to have first priority. Ballots apply only thereafter, within defined catchment areas deemed to be fair by the local authority.
My Lords, can the Minister reconcile lotteries with the agreed, stated policy of the Government, which is choice agenda, of which there has been no more eloquent proponent than himself? Does he remember the arguments that he put to the House last summer to persuade us to vote for trust schools? He said that,
“parents have a far wider degree of choice. They exercise that choice at the moment”.—[Official Report, 21/6/06; col. 864.]
As choice and lotteries are incompatible, would it not be fair to recognise that Brighton is engaged in social engineering? If it has poor-performing schools, those will be improved not by moving children from better schools to them, but only by better leadership, better teaching and better discipline. Surely the education of our children—all our children, including the Minister’s—merits more than a raffle.
My Lords, I agree entirely with the noble Lord’s point about the quality of leadership and having effective teaching in schools. I am glad to say that leadership in schools has improved dramatically in recent years, as judged by Ofsted, which, of course, is important, so that we have more good schools. However, I do not understand his point about the incompatibility of random allocation and choice. The crucial point to understand is that the random allocation comes only after the parents have expressed a preference. The trouble with many schools is that there are more parents expressing a preference for them than there are places available. If I were a magician, I would be able to magic up the additional places, but I cannot—as the noble Lord could not when he was Secretary of State—provide more places in schools that are already full. There has to be some system for allocating places in cases of oversubscription. At the moment, the most common way of doing that is measuring the distance from the school gates. Brighton is proposing a random allocation with a defined catchment area. Neither approach is inherently more or less fair than the other.
My Lords, in countries such as Sweden, where the range of types of school is much narrower than it is here but the standard is consistently higher, parents rarely exercise their right to choose to send their child to a school other than the local one, yet satisfaction levels are much higher than they are in this country. Will the Minister therefore concentrate more on quality than on choice?
My Lords, I concentrate all the time on quality; it is a very important theme. However, the noble Baroness may be aware that Sweden has also adopted a school choice policy; it allows independent suppliers to come into the system. The policy was started in the early 1990s and now 7 per cent of all schools in Sweden are operated by independent operators, which have a wide variety of educational practices in their schools. Sweden is going down precisely the road that we are and is subject to exactly the same pressures that we are in terms of parental preferences.
My Lords, I believe that the local authority accepts its responsibilities to improve the schools that are underperforming in Brighton. It has a set of measures in place to do so, including the proposal to turn one of its worst-performing schools into an academy. My department is in active discussions with it about academy status for that school precisely to deal with the issues of leadership, quality of teaching and ethos that will make the school more popular in its local community.
My Lords, for schooling to work well, we know that parents and children need to feel that they have chosen that school and that the school has chosen them. Surely a lottery, even for a very few pupils, while convenient for the local authority and evidently convenient for the Government, is absolutely wrecking that concept.
My Lords, there is a fundamental misunderstanding here. Parents express a preference for schools; that continues whether you have a lottery or any other oversubscription criteria. The issue that we are addressing is that, when more parents express a preference for a school than there are places in that school, there has to be some means of ensuring that the places in the school are allocated fairly. As I said, it is not clear that simply doing that on the basis of proximity to the school is inherently fairer than allowing a ballot to take place within a defined area around that school, which is what Brighton has allowed to happen. We think that this is properly a matter for local decision. As for parental confidence in the system and what actually happens, I should stress that, at the moment, 85 per cent of parents get their first choice of secondary school and 96 per cent of parents get one of their choices of secondary school. Moreover, the number of appeals against secondary admission is falling. We need to put this issue into perspective.
My Lords, banding can be a very good answer. It is increasingly used in schools to ensure a proper cross-section of ability within a local area. Of course, when you have a banded system, you still have to decide how you are going to deal with oversubscription within the bands. A common form of dealing with it is now random allocation.
My Lords, the Minister knows that I approve of banding and indeed of ballots; I like the way in which they are being operated at Haberdashers’ Aske’s in Hatcham and in Hertfordshire. But the system where you can be living next to a school and, if you lose out, have to go four miles away to your second choice is causing immense pain to the people of Brighton. It is as if the places on the Brighton to London train were allocated by ballot at the station. It is causing immense difficulty in the town. Will he not tell Brighton that it is going about this in the wrong way?
My Lords, that is a matter for Brighton. It is not my job to substitute my judgment for that of the local authority on precisely how it should draw the boundaries of catchment areas, which is the issue at stake in the noble Lord’s remarks. It tends to be the case that, where some gain, some lose as well.
Hereditary Peers’ By-Election
My Lords, with the leave of the House, I am now able to announce the result of the by-election to elect a Conservative hereditary Peer in accordance with Standing Order 10.
Forty-three Lords completed valid ballot papers. A paper setting out the complete results is being made available in the Printed Paper Office and the Library. That paper gives the number of votes cast for each candidate. The successful candidate was the Earl Cathcart.
Road Traffic (Northern Ireland) Order 2007
My Lords, I beg to move the first Motion standing in my name on the Order Paper. There is, however, a second Motion standing in my name today for an affirmative order. However, since it was debated, a drafting error has been discovered—by, I understand, a Clerk in the Journal Office of the House of Commons—wrongly cross-referencing a schedule in the previous Act. As a result, the order will have to be redrawn and re-laid today. I shall not, therefore, be moving the second Motion standing in my name. We will seek another date for that order to be approved in due course. I apologise to the House for that and beg to move the first Motion.
Moved, That the draft order laid before the House on 18 December 2006 be approved. Considered in Grand Committee on 27 February.—(Lord Rooker.)
On Question, Motion agreed to.
Policing (Miscellaneous Provisions) (Northern Ireland) Order 2007
Motion not moved.
Serious Crime Bill [HL]
My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved accordingly, and, on Question, Motion agreed to.
House in Committee accordingly.
[The LORD SPEAKER in the Chair.]
Clause 1 [Serious crime prevention orders]:
1: Clause 1 , page 1, line 5, leave out “order” and insert “Organised Crime Prevention Order”
The noble Baroness said: The objective of the amendment is to ask the Minister to clarify some of the confusion caused by the consultation paper that preceded the drafting of the Bill and which may have undermined the usefulness of some of the responses.
What kind of people have the Government decided the courts and police are no longer capable of tackling via the normal criminal justice system? I am aware that the Minister made it possible last night for noble Lords to hear a briefing by those in charge of the Serious Organised Crime Agency. I sent a representative to the meeting and I have seen a note of it. I am sure that the meeting was very helpful to those who were able to attend.
The director and the chairman of the Serious Organised Crime Agency gave their own views about what kind of people they might be able to target. I also understand that they gave the examples on the basis that they would be subject to Chatham House rules, because specifics were being given. Certainly against the background of some of the arguments with the BBC and the Guardian this week, I wholeheartedly support the proposal that we should not reveal any of those details on the Floor of the House. I would never myself wish to undermine a police operation and a successful criminal prosecution.
We need to know what kind of people the Government are giving up on in terms of criminal prosecutions: who, they feel, are suitable only for subjection to a serious crime prevention order. We will have debates later on what kinds of crimes are being considered; I am asking now, what kind of—we would say—criminals?
The consultation paper New Powers Against Organised and Financial Crime was published in July 2006. It was directed that responses be sent to the “organised crime consultation team”. The executive summary refers to plans to introduce a “serious crime prevention order”, but Chapter 3, which deals with consultation on this proposal, is suddenly headlined “Organised crime prevention orders”. We then switch back again, a page or so later, to the use of the term “serious crime prevention order”. But in the questions put to respondents—for example, questions 7 and 8—the Government return to the term “organised crime prevention orders”. What kind of criminals and crime are the Government really asking respondents to consider appropriate for this kind of order? It certainly did not appear crystal clear from the consultation paper. What are we expecting to deal with as we consider this Bill: serious crime, organised crime, or serious and organised crime?
If it is intended that the order should affect only those involved in organised crime, why not say so consistently? What was the rationale behind the confusing use of different terminology at different times? It is important to know that from the start, because the changes that the Government propose in Part 1 are significant.
I note, too, that the proposals relate to England, Wales and Northern Ireland. My noble friends Lady Carnegy of Lour and the Duke of Montrose may wish to ask questions about the potential impact on Scotland. As ever, I defer to them on matters relating to Scotland.
The report of the Select Committee on the Constitution set out clearly the challenge that lies ahead as we scrutinise Part 1. It said:
“A broad question for the House is whether the use of civil orders in an attempt to prevent serious criminal activity is a step too far in the development of preventative orders. Whether or not the trend towards greater use of preventative civil orders is constitutionally legitimate”—
a matter on which it expressed doubt—serious crime prevention orders, in its view, represented an incursion into the liberty of the subject and constituted a form of punishment that cannot be justified in the absence of a criminal conviction. That challenge has guided how we have approached our consideration of Part 1.
I made clear at Second Reading that it is vital that the Government—any Government—should protect the British public from those who do their utmost to encourage serious organised crime and profit from it, while taking great care to stay at arm’s length from those crimes. They are a danger to all of us but their hands never appear dirty in public. We know it is difficult to take measures to protect the public from such people, but we know it is vital that we should. However, the methods we adopt must be proportionate and effective, without undermining our system of law and justice.
The Select Committee’s report makes it clear that we should consider whether the Government’s proposals in Part 1 would undermine that system of law and justice. The best weapon against serious criminals is to track them down, charge them and prosecute them. My first reaction when I read Part 1 was that it looked like bad policy and bad law. We are sceptical about the Government’s proposals but we are concerned that we should give them a full, fair consideration. We have therefore tabled a significant number of amendments to Part 1 to give the House the opportunity to examine both the principle and the practice likely to underpin the imposition of serious crime prevention orders by our courts. Our objective is to give noble Lords the fullest opportunity at Committee stage to scrutinise whether these new civil injunctive orders are a step too far or whether there are grounds that can be put forward on which they should be tolerated.
The answers we will receive from the Minister during our deliberations on Part 1 will inform our approach on Report. I beg to move.
I support particular amendments in the names of the noble Baroness, Lady Anelay, and the noble Lord, Lord Henley. Our reasons are very straightforward. We are challenging the name “serious crime prevention order”. The recommended name “organised crime prevention order” is much more appropriate. If this part of the Bill arises out of the need to tackle serious organised crime, it should be described as such.
I thank the Minister for the briefing session yesterday. It was pretty clear that we were talking about serious organised crime, particularly relating to class A drugs, human trafficking and fraud. Serious crime encompasses a much wider bracket of offences than organised crime. Although serious crimes can be linked to organised crime, it is important that such orders are not extended to cover individual offences where there is no evidence that they are connected to organised crime.
Public perception is somewhat different. This amendment should be supported so that the clarification is there for all to see.
As we are discussing the scope of these measures, it is interesting to note that the Explanatory Notes kindly mention that,
“the Bill contains provisions that trigger the Sewel Convention. The provisions relate to creating an offence of breach of a Serious Crime Prevention Order … detained cash investigations and power of forced entry”.
I am familiar with the fact that we are perfectly at liberty to discuss at Second Reading issues that bear on Scotland. However, I am still not sure how far we can go in discussing these measures before a Sewel convention appears from the Scottish Parliament. I hope that the Minister will clarify that. I gather that the draft legislative consent Motion endorsing the principle of serious crime prevention orders will be lodged with the Minister of Justice in Scotland. Has that already been done?
The noble Baroness, Lady Anelay, referred to the kind of criminals to be targeted. I wish to raise the matter of the qualifications of the individuals to be employed in the agency, the resources that will be made available to that agency and when they will be made available. I am grateful to the Minister for organising last night’s meeting with the chairman and director-general of the Serious Organised Crime Agency. The chairman has an outstanding record of public service, is highly respected and is a powerful advocate.
We owe it to our fellow countrymen to ensure that the police and these agencies have sufficient and proportionate powers to bring criminals to justice, but we must, of course, balance these with the freedoms and liberties that we should always enjoy. However, noble Lords on these Benches will ensure that the liberties and freedoms that we enjoy are not stretched too far.
I thank the noble Baroness, Lady Anelay, for the way in which she introduced the amendment. It is clear that it is a probing amendment which seeks to understand how these issues are interpreted. I very much take on board her comments about the use of both “serious crime” and “organised crime” in the consultation document. I shall seek to explain why we settled on “serious” as the most appropriate description.
I too thank the director for talking to us last night about these issues. I shall try to stick within the parameters of Chatham House rules in mentioning what took place. The crimes that we are talking about are very serious, including trafficking in people or in drugs, the illegal selling of guns, or money laundering. They are all committed, for the most part, by cunning, ruthless and innovative criminals. Regrettably, the number of these complex and far-reaching offences is growing. Innumerable offences are being investigated by the Serious Organised Crime Agency which the director, Sir Stephen Lander, explored in detail with us yesterday.
An interesting development of serious crime is that many criminals do not participate in simply one form of such crime; the same criminal network may be involved in guns, trafficking, money-laundering and criminal drugs activity, as well as having some connection with terror. Those offences are very serious.
The way in which these offences are committed has also become increasingly complex as serious criminals seek to take advantage of what would otherwise be legitimate activity when carried on by third parties. The Government are seeking to prevent that and are absolutely committed to ensuring that the law enforcement tools that we create prevent the damage to people’s lives that serious crime causes. These orders are therefore sought as a reasonable and proportionate response.
I agreed with many, if not all, of the comments that noble Lords made on this issue today and at Second Reading. The orders have to be proportionate, reasonable and accurately targeted, so the first limb of the test provides that the order can only be made where the court is satisfied that its proposed subject has been involved in serious crime. Therefore, I understand why the noble Baroness, Lady Anelay, asks how and why we alighted upon “serious” to best describe it. A simple answer is that the term has already been acknowledged and used in other ways in our legislation.
One main reason that we rejected the term “organised crime” was that the term is widely used, both in this country and abroad, and there are so many different understandings of what it is. Noble Lords will recall that at Second Reading it was made plain that many of the serious offences and crimes are now, regrettably, not purely national; they have become international, and often we have to rely on other agencies in the international community working with us to interdict serious criminals’ activity in our various countries.
The term “serious” has an existing definition in our jurisdiction; in other countries, there are a number of different definitions of “organised crime”. Given the international nature of these crimes, we wanted to avoid any confusion, and we believe that it is appropriate to focus on the seriousness of the crime concerned as opposed to whether two, three, four or more people are engaged in the activity.
The concept of serious crime, as I have said, is already understood and applied in related legislation; for example, the Proceeds of Crime Act. While the definition provided by Clauses 2 and 3, together with Schedule 1, is not identical to that in the Proceeds of Crime Act, since they are for different purposes, its basic similarity will make it familiar to practitioners and the courts. That related jurisprudence will greatly assist us. For these reasons, while I sympathise with the intent behind this amendment, and I hope that I have been able to explain why we have chosen “serious”, I invite the noble Baroness, Lady Anelay, not to press it.
I turn to the issue raised by the noble Duke, the Duke of Montrose. I will return in a moment to those raised by the noble Lord, Lord Burnett. A number of provisions in the Bill extend to Scotland. These are: Clause 74, on the use of force in executing search warrants, which applies only to Scotland; Clause 75, which relates to the extension of certain powers to Her Majesty’s Revenue and Customs; the breach of a serious crime prevention order being a criminal offence in Scotland, and the sharing of information with a specified anti-fraud organisation.
The power to share, however, does not apply to information that would be within the legislative competence of the Scottish Parliament. The transfer of the powers of the Assets Recovery Agency to SOCA applies throughout the United Kingdom, and the ARA does not currently have powers to take civil recovery investigations and proceedings in Scotland; those powers will remain with Scottish Ministers.
We engaged closely with the Scottish Executive from a very early stage to ensure that their views on the devolved matters affecting Scotland in the Bill were properly accounted for. We have made sure that provisions in the Bill—as currently drafted, I should emphasise—that touch upon the competence of the Scottish Parliament have been the subject of a legislative consent Motion in line with the Sewel convention. The Motion has been considered by the Scottish Parliament’s Justice 2 Committee, which supported it, and it is due to be considered by the Scottish Parliament in plenary vote tomorrow, 8 March—International Women’s Day. We cannot gainsay the view of the Scottish Parliament, but from the indications that we have received from the Minister of Justice, we expect that the Motion will be passed.
The noble Lord, Lord Burnett, asked about resources. All that I can do is assure him that the resources that came from the three agencies into the Serious Organised Crime Agency have been adequate for its needs. Obviously, this matter will be raised from time to time in any budget or in other provisions made in relation to it. If I have further information, I will be happy to write to the noble Lord in due course.
Before the Minister sits down, I make a short plea. This level of international crime is highly sophisticated and the people who operate within it have very bright advisers who are busy helping them to escape the law. This agency requires sophisticated, intelligent and knowledgeable people. There is a cadre of such people available—perhaps not aged 20 or 30, but certainly in their 40s. There are people in the City of London who have probably done rather well and might wish to do something for their country. I am aware of a number of such people in their early 40s; they will not want to be paid the Earth. I hope that this agency will have a pretty wide recruitment policy and will want to attract people of a high calibre, who know about international banking, international money flows and so on, because that is one of the keys to catching the criminals we are dealing with.
Perhaps I may reinforce what the noble Lord has said—he is absolutely right. The Serious Organised Crime Agency has drawn unto itself some real expertise. This involves high quality work that needs the most careful consideration, and there is a total commitment from Sir Stephen Lander to recruit people who will be able to intercept serious crime, which flows in the way described by the noble Lord. I assure him that the need for that sort of acumen is absolutely understood by SOCA and the Government. The noble Lord is right to say that some of these criminals are extremely skilled and they have the advantage of a great deal of illicit money with which to acquire even greater skill.
I listened with great care to the noble Baroness’s answer to my noble friend the Duke of Montrose and I shall read it to try completely to understand what she said. I understood from the last part of her comments that the Sewel motions will be considered and brought up to date tomorrow—I am not sure whether the link between International Women’s Day and serious crime is appropriate. Can we have an assurance that if, in our discussions and in the course of amending the Bill, we create more situations where Sewel motions are required, she will tell us about them and let us know when they are agreed? It is the duty of us in this House to try and keep things right between the two Parliaments so that when the Bill goes to the House of Commons, they know that there is no time lag.
I can indeed give the noble Baroness that assurance. We have kept in the closest possible touch with the Scottish Executive so that we are in alignment with that with which they feel comfortable. I will certainly come back and advise noble Lords of any difficulty and of how we are getting on as we go along. I would not want this House to err.
I am grateful to all noble Lords who have contributed to this short debate. In particular, I thank my noble friends for raising the issues of Scotland with the noble Baroness, Lady Scotland. I am sure we will return to these issues. The Minister has given my noble friends the opportunity, as my noble friend Lady Carnegy said, to consider these matters further between now and Report. The Home Office has a record that is not particularly envied outside, except in respect of its attention to detail over Scottish matters in response to issues raised by my noble friends. We have certainly appreciated the fact that the Bill team has brought to meet us those who advise in Scotland. Therefore in the past we have been able to ensure that Bills are appropriate for action not just in England but in Scotland too. I am sure we will keep our eyes on that as this Bill proceeds through this House.
I am grateful to the Minister for addressing the issue of clarification. We will return to the matter of crimes in detail in later amendments. I was particularly interested in the question of which criminals the Government are trying to target. I note that the noble Baroness tried to explain how criminals have developed in different ways. They are not just more violent and do not just have greater access to funds but appear to be even more careless of the safety and security of anybody else except themselves and are therefore increasingly dangerous to the public, and particularly to those police and security forces who try to protect us.
When the noble Baroness says that the Government have rejected the definition of organised crime because there are so many different understandings of what that is, I have to agree with her. But then the Government seemed to be going out of the frying pan into the fire. In view of the way in which serious crime is treated in the Bill, the Government have raised difficulties about how to construe what serious crime is. They have not been able to resolve those difficulties in Schedule 1, which we will examine later, such that they even leave it to a judge to determine on a day-by-day basis what serious crime may be. We will need to consider that issue very carefully to see whether Part 1 is going to be fit for purpose in the Home Office’s terms.
I am grateful to the noble Baroness. I think she has started to set out the Government’s stall in a way that will assist scrutiny. I am not sure she will be particularly happy with some of the conclusions that we will draw from it, but at this stage I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
2: Clause 1, page 1, line 6, after “satisfied” insert “beyond reasonable doubt”
The noble Lord said: In moving this amendment, I shall speak also to Amendments Nos. 4, 87 and 88. The purpose is to tease out what the Government actually have in mind in relation to reasonable doubt. As a result of this amendment, the rules of evidence that apply in criminal proceedings would apply in proceedings relating to serious crime prevention orders.
The amendments would also clarify the Government’s intention that a court should be satisfied beyond reasonable doubt that a person has been involved in serious crime before making an order. The British legal system and post-war human rights framework apply more rigorous fair trial standards to criminal trials than to civil proceedings. This is because a civilised democratic state can only justify using this great force to punish an individual if it is established beyond reasonable doubt that the individual has committed an offence and the individual has been given a fair opportunity to defend himself.
At Second Reading, the Minister, the noble Baroness, Lady Scotland, was eager to counter arguments that serious crime prevention orders were a means of evading the higher fair trial guarantees that apply in criminal proceedings. She said that serious crime prevention orders are,
“civil orders, so this involvement [in serious crime] will have to be proved to a civil standard. But I know that many of your Lordships will be only too aware—so I hope that noble Lords will forgive me if I emphasise it—that where serious assertions are made, the civil standard can be virtually the same on certain issues as the criminal standard. Recent case law has stated … that in proceedings like these the court will look at the civil standard as a sliding scale, with the likely standard of proof for these orders being very close to the criminal standard of ‘beyond reasonable doubt’”.—[Official Report, 7/2/07; col. 729.]
We acknowledged that that could be the case. However, it is not by any means certain that the courts would apply this higher standard of proof in serious crime prevention orders proceedings. These amendments would clarify the point and provide the certainty that is rightly sought by many Members of the Committee.
The fair trial guarantees in criminal proceedings also go further than a high burden of proof—for example, the general rule against reliance on hearsay evidence. The general requirement that a person is convicted only on the basis of statements made in oral evidence in proceedings was designed to ensure that guilt or innocence is not determined on the basis of unreliable rumour and gossip and to ensure that the suspect has a chance to challenge the evidence against him. It continues to perform a vital function, helping us to ensure that the innocent are not swept up with the guilty and maintaining public faith that our justice system does indeed deliver justice. This is clearly as relevant today as it was in the past. The amendment would ensure that these criminal rules of evidence apply to serious crime prevention order proceedings. I beg to move.
This seems to me a rather important amendment. Indeed, it goes to the heart of my objection to the Bill—that is, the use of the civil courts to perform what is fundamentally a function that belongs to the criminal courts.
During her reply at the end of the Second Reading debate, I invited the Minister to have another look at the case of McCann, which is reported in 2003 1 Appeal Cases at 787. My memory of that case was that the House of Lords decided that the criminal standard of proof should apply in ASBO cases. I looked at McCann between then and now. The noble and learned Lord, Lord Hope, said at page 825:
“Given the seriousness of the matter, the court should be satisfied to the criminal standard”.
This very issue was at stake. The noble and learned Lord, Lord Steyn, said the same at page 812. He said that magistrates,
“must in all cases [under the ASBO legislation] apply the criminal standard”.
Nothing could be clearer than that, and nothing could be clearer than the fact that serious crime is a great deal more serious than anti-social behaviour. Therefore, the case for applying the criminal standard in the Bill is overwhelming, and I do not see how the Minister can resist this amendment or the consequential removal of Clause 33(2).
I know that the Minister reads the law reports when she has time, which cannot be all that often. I sometimes wonder whether those responsible for drafting criminal legislation do the same. If she sees her way to accepting this essential amendment, many of my objections to the Bill, although not all of them by any means, will be removed.
I begin my short intervention by saying how sorry I was not to be able to take part in the Second Reading debate on 7 February—a temporary disablement immobilised me. I read with admiration the speeches made on that occasion. I must resist the urge to make a Second Reading speech on this or any other amendment. It is a particularly powerful urge on this amendment because it relates to a provision that was properly described last time as “authoritarian”.
For the reasons touched on by the noble and learned Lord, Lord Lloyd of Berwick, it is an extremely important point indeed. The provision the amendment relates to infringes a fundamental principle of our liberty and therefore of our laws that protect our liberty. That principle is that we may not be subject to a punishment for committing some proscribed conduct unless the fundamental facts to that prosecution are established by reference to the criminal standard of proof—beyond reasonable doubt. That is fundamentally important, and it does not matter with what motive the lawmaker brings forward his legislation. The Minister at Second Reading said: “Oh, but this is not a criminal matter; this is not a punishment; this is a civil order”. I find it very difficult to see how she thought she could sustain that because it is a provision that impinges very importantly and drastically on the liberty of the individual.
It is not sufficient for the Government to say, “You can see what our motive is: it is simply to protect the public from the commission of further crime”. A fairly topical example is that locking somebody up in Belmarsh without a charge can be said to be for the protection of the public. That does not make it any the less a penal intervention in his life and liberty, as the Government have found; nor does it make it any more a civil measure. These orders will apply on proof of proscribed conduct. All of that can be found in Clause 2(1)(a) to (c). Breaching the orders will attract a maximum punishment of five years’ imprisonment. These seem to me to be the hallmarks of a penal provision. If so, they should surely attract the criminal standard of proof. I very much hope that the noble Baroness will reflect further on this and return on Report, or perhaps even later today, to say that she has thought further and better about it.
I would like to pursue a point arising from the points made by the noble and learned Lord, Lord Lloyd, and my noble and learned friend. I have grave concerns with the Bill because of its lack of focus and the uncertainty it engenders. There is one very seriously unpredictable consequence—and I think that the noble and learned Lord, Lord Lloyd, gets close to shadowing the point. If one brings in an order against an individual suspected of a serious crime, he might actually welcome it because it will put him on warning that he is being investigated and give him time to get his assets out of the country before he is arrested. There is nothing like enough in the Bill to provide for taking the natural consequences of an order through to the point of freezing the assets or getting a grip on the individual so that it becomes an offence if he moves any of his assets after an order is given against him.
I appreciate that that is almost a reversal of what my noble and learned friend said, but it is a serious concern. I have had about £0.5 billion worth of fraud carried out against my companies over the years and I have never succeeded in getting a single penny back, whether or not I have had a Mareva injunction—and I usually have. It just does not do in this Bill to have effectively a free warning system to someone that we are coming for him and there is nothing to freeze his assets.
I have considerable sympathy with the speeches made in support of the amendment, but I am rather puzzled as to where, if the amendments are passed, that leaves this whole part of the Bill. As I understand it, the purpose of the Bill—whether it is acceptable or not is another question—is to enable someone to be dealt with where it could not be proved in the criminal court that he had committed an offence, so that the order could be made. If the amendment, together with Amendments Nos. 87 and 88, is passed, first, the order can be made only if it is proved beyond reasonable doubt—that is, to a criminal standard—that he has committed an offence and, secondly, you can use only such evidence as would be admissible in a criminal trial. Surely that means that you have enough to get the person convicted, unless you think, “If I go in front of a judge without a jury I will get a conviction, or an order, but if I go in front of a jury, I will not get a conviction”. Well then, let us abolish jury trials for such offences. I gather that we are about to attempt to abolish jury trials for some other offences.
It seems to me that there will be nothing left of the whole of Part 1 if the amendments are passed, with the possible exception that you may be able to get an order if you can only prove that someone must have been involved in a crime, rather than, as you must do in a criminal court, specifying the crime with which you are charging him and of which he is to be convicted. It is surely not satisfactory to say, “It is obvious that you have committed a very serious crime. How on Earth else have you got this vast sum of money and are living where you do? I cannot tell what it is, but you must be guilty of a crime, so I shall make one of these orders”.
I ask the proponents of the amendments to explain what is left of Part 1 if they are passed. They may say, “No, nothing is left of Part 1, and a jolly good thing, too”. I may agree with them, but we should be clear whether we are being asked to strike Part 1 from the Bill or whether the amendments are something much less.
I shall try not to repeat what has been said, because I very much agree with what the noble and learned Lord, Lord Lloyd, and others have been saying. I want the noble Baroness to tease out and explain to us how the new agency intends to make progress in a way that it could not do through the ordinary criminal courts. I have a great deal of sympathy with the notion that the ordinary criminal standard of proof and the ordinary criminal procedures should have to be applied.
If we move away from that, we shall find two particular problems. First, defendants and prosecutors will not really know where they are. Secondly, there is a serious danger that the procedures will fall foul of the European convention and we shall find cases being taken to Strasbourg. We know—I will not say that this is unfortunate, because I think that it is right—that Strasbourg is very clear that, when penalties are imposed that are in effect criminal, they are treated as criminal and criminal standards are required throughout the case.
Given the Government’s explanation of the matter so far and the likelihood, following McCann and other authorities, that the courts will effectively impose criminal standards in a large part of this, there might be a very great deal to be said in favour of, as the amendment suggests, writing those criminal standards into the Bill. My question, which is, in a way, the antithesis of the question of the noble Viscount, Lord Bledisloe, is: how does the noble Baroness see this working? Can she flesh out briefly with a few practical examples how the procedures will assist?
I sympathise with the Government on their aim. It is important that, as is stated in the Bill, the public should be protected. But this situation would in practice involve the equivalent of a criminal penalty and, given what we have heard from the noble and learned Lord, Lord Lyell, regarding the view taken in Strasbourg, I want further assurance about the Minister’s endorsement on the face of the document that the Bill’s provisions are compatible with convention rights. On further reflection, and having heard the points that have been made, does she maintain that this provision is human rights-proof?
My view is that there may be cases—I presume that this is why the Government are bringing forward the Bill in this connection—where it would be difficult, for a whole host of reasons that I will not go into, to adduce the kind of evidence that would be heard in a criminal court. I would like to hear the Minister’s argumentation on whether, in a situation that inevitably is in the same ballpark as a criminal penalty by the restrictions set out in subsection (3), that is in reality nothing more or less than a criminal penalty.
We would not have to go to Strasbourg. We on these Benches opposed ASBOs when they were introduced on the basis that to use a civil process in the way that the Government proposed would inevitably be a breach of convention rights. That was the decision of the House of Lords in McCann; the Lords decided that, unless there was read into the legislation a criminal standard of proof—essentially, we are dealing with criminal behaviour and criminal penalties—the Act as it was passed in relation to ASBOs could not stand.
Here we have gone a step further. We are not dealing with anti-social behaviour; we are dealing with serious crime. The penalties to be imposed by the orders are house arrest, the freezing of assets—the answer to the noble Lord who spoke from the Conservative Benches a moment ago is that an order could contain such a provision—and a restriction on liberty, which is completely unacceptable unless there is a fair trial under Article 6.1.
The essential point is that there be in place the sort of safeguards that exist in a criminal trial. Those safeguards are, first, clarity: a person should know what he is charged with. The second safeguard is that what he is charged with has to be proved by the prosecution beyond reasonable doubt; the Minister has conceded that the orders can be made only if the activity complained of was proved beyond reasonable doubt. Thirdly, it is necessary in a criminal trial to produce evidence on a proper basis—not rumour, tittle-tattle or hearsay, but direct evidence. Fourthly, if the prosecuting side fails to reveal its hand and to disclose anything that might impinge on what it is doing, that is an abuse of process. All those safeguards are in place under the concept of a fair trial in Article 6.1.
The Government cannot hide by saying that this is a civil process. It is not a civil process. It imposes serious restrictions on liberty and that is the basis of the amendments that we have tabled. The answer to the question of the noble Viscount, Lord Bledisloe, of what is left of Part 1 if the amendments are passed, is nothing—and good riddance.
We have some sympathy for the amendments tabled by the noble Lord, Lord Dholakia, but at the same time we also have sympathy for the arguments put forward by the noble Viscount, Lord Bledisloe. If that sounds confusing, I have to say that the Government’s own position is somewhat muddled. The noble Baroness will recall that the noble Lord, Lord Thomas, intervened in her speech at Second Reading to ask whether an undertaking could be given to add the words “beyond reasonable doubt” to the Bill. That followed her statement that in effect it was not necessary because,
“where serious assertions are made, the civil standard can be virtually the same on certain issues as the criminal standard. Recent case law has stated clearly that in proceedings like these the court will look at the civil standard as a sliding scale, with the likely standard of proof for these orders being very close to the criminal standard of ‘beyond reasonable doubt’”.—[Official Report, 7/2/07; col. 729.]
If that is the case, I fail to see why the noble Baroness resists actually having the words “beyond reasonable doubt” on the statute book.
When considering the first amendment, my noble friend made it clear that we are sceptical about the Government’s proposals and that at this stage all our amendments are designed to probe exactly what they intend and whether what they are doing is really a step too far in dealing with serious crime. For the same reason, we have some sympathy for this amendment in order to tease out exactly what the Government intend—whether they really believe that “beyond reasonable doubt” can be inferred, as the noble Baroness put it, as a result of recent case law, or whether it might be better to add the words to the Bill.
It is clear from the number of noble Lords and noble and learned Lords who have spoken that it might be advantageous if I contextualise where we are and how these orders will work. The orders are preventive measures, and perhaps I may explain why. Regrettably, and particularly with serious crime, serious criminals are generally those who will commit crimes again and again. I will check this, but the figures show that around 85 per cent of very serious criminals are recidivists. When they come out of prison, they go back to committing more crimes, in a way that is complex and difficult. The task is not only simply to catch and convict them of a particular crime, but also to prevent them committing further crimes, to interdict that criminal behaviour and to look at the methodology that they adopt and target a preventive order that makes it more difficult for them to perpetrate those or similar crimes again.
It absolutely does not mean that that would be the case. Let us take as an example a people trafficker. The individual may spend a considerable amount of time travelling to China and another country in Africa, from which they have trafficked individuals. It may be appropriate, when looking at that particular individual, to set a condition preventing them for a certain period from travelling to those two countries after they leave prison. Why should we do that? Because we know from their modus operandi that those are the areas in which they operate. The condition will act as a “preventer”, potentially, of serious activity.
It is important to look at how this clause is set out. The first thing to say is that these orders can be made only by the High Court in England and Wales, and there are appropriate provisions for courts of a similar nature in Northern Ireland. All noble Lords who have had the privilege of appearing before the High Court—the noble and learned Lords, Lord Lloyd of Berwick, Lord Mayhew and Lord Lyell, the noble Viscount, Lord Bledisloe, and the noble Lord, Lord Thomas of Gresford—will, I hope, affirm that the High Court is well seized of the application of the law in civil cases and is attuned to the different balances that there need to be with regard to different assertions made about proof in a civil standard. The High Court judges of this country have no difficulty in differentiating between those issues that are serious and therefore need the balance of probability heavily weighted before the judges are satisfied, and those that do not. That is a premise on which I hope we can all agree.
These orders are not simply to say whether an individual is guilty or not; they are preventive in nature. To take up the point made by the noble and learned Lord, Lord Lyell, the Strasbourg jurisprudence makes it clear that a measure will be held as criminal only if it is punitive. These measures are not punitive, but preventive; they are not an alternative to punishment through criminal law, but another string to the bow of the agency that is seeking to interdict crime. The punitive element comes into play only if there is a breach.
We need to be frank. If one has an injunction made by a civil court not to behave in a specific way and one breaches that injunction, there is a punitive element there, too—either contempt or some other provision to enforce the order made by the court. It has never been suggested in those circumstances that those are criminal in nature, albeit that they are punitive to enforce an order.
I thank the Minister, since she was focusing specifically on my point. Does she not agree that the court at Strasbourg will look at the substance of the matter and not the alleged form of it? If someone is under long-term house arrest, with a very serious loss of liberty in consequence, will the court not describe that as punitive?
I said in answer to the noble Lord, Lord Thomas, that it is not proposed that these issues should relate to house arrest. We are looking at a specific methodology adopted by a criminal, and we are asking the High Court to do two things. Under Clause 1(1)(a), to make an order the court has to be,
“satisfied that a person has been involved in serious crime (whether in England and Wales or elsewhere)”,
and it has to have,
“reasonable grounds to believe that the order would protect the public by preventing, restricting or disrupting involvement by the person in serious crime in England and Wales”.
That enables the court to target the condition to address the mischief complained of. One of the difficulties with which the court will be faced is that, because the nature of the criminal activity that any particular individual may be involved in will differ, the tool that you will need to use with regard to criminal A may be significantly different from the tool you will need for criminal B, who may be engaged in a totally different type of crime. We must make sure that those provisions are fit for purpose.
I am sure that the Minister will come on to dealing with the basic problem here. ASBOs are preventive, as I am sure she will agree, in exactly the same way as these orders are intended to be. However, the House of Lords has unanimously decided that the standard of proof in those cases is the same as the criminal one. How can she get around that?
I do not propose to, but I should like to expand on why the civil standard is the most appropriate. The judgment in the McCann case did not convert anti-social behaviour orders into criminal orders. It said that they are civil orders, but when looking at the assertion which has to be made by the applicant, the test to be applied is virtually identical to the criminal standard because of the nature of the assertion made in those civil proceedings. It was not suggested that they were criminal in nature. I am sure that the noble and learned Lord read the judgment very carefully.
I confess to being confused by the noble Baroness’s remarks. At Second Reading, I thought that this part of the Bill was put forward on the basis that there were people whom you could not get convictions against because you could not get the evidence together, so you would have these orders against them. Now the noble Baroness has said that she is concerned about people who have been convicted but have come out of prison and may resume their behaviour. If that is the case, surely the sentencing court can be given the power to impose orders of this kind as a condition of release. Are we dealing with people who have been convicted and may go back to crime or with people known to have committed crime but who cannot be brought before the criminal courts successfully for lack of admissible evidence?
In one sense, we are dealing with both groups. We are dealing with groups of criminals who have previously been convicted of offences and whom we wish to prevent adopting a similar modus operandi and committing future crimes. We are also dealing with individuals—quite often third-party—used by those criminals to undertake legitimate activity for an iniquitous purpose. For example, there may be an arrangement whereby a criminal buys vehicles with false bottoms in which to transport people and/or drugs. The third party involved never sees the criminal or has an explicit conversation with that individual, but it is clear that the use to which the vehicles are being put, such as people-trafficking or drugs, is iniquitous. At present, there is a difficulty because such third parties will seek to rely on the fact that the activity is legal, commercial and cannot be interfered with. The orders would enable us to prevent that continuance in order to prevent serious crime being facilitated. That is why it is important.
I see the noble Lord, Lord Goodhart, getting to his feet but before he does I should like to come to the point made by the noble Lord, Lord Dholakia. I have tried for a number of minutes to get to the noble Lord’s question and to that of the noble and learned Lord, Lord Lloyd. If the Committee will indulge me, it might be easier if I deal with those before the noble Lord, Lord Goodhart, gets to his feet to interrogate on a further point.
The first limb of the test for obtaining an order is whether the person has been involved in serious crime. The burden of proof is on the relevant applicant authority. The standard of proof will be the civil standard but, given the seriousness of the conduct alleged, following McCann, the standard the court will expect to be reached is likely to be close to “beyond reasonable doubt”.
The second limb of the test for obtaining an order—this is a two-limbed clause—is whether the order will protect the public by preventing, restricting or disrupting the person’s involvement in serious crime. It is not a question of fact but one of judgment for the court. As a consequence, there is no burden of proof or any corresponding standard of proof. It is for the potential subject of the order—the respondent—to prove. The burden is on the respondent to prove that his actions were reasonable and should not form part of the court's decision on whether his actions facilitated or were likely to facilitate a serious offence, and the standard of proof will be the civil one. As the burden is on the respondent, we would expect the court to apply the standard of “on the balance of probabilities”.
There are parallels here with a criminal prosecution. In a criminal prosecution the burden of proving the offence is on the prosecution and the standard is “beyond reasonable doubt”. If the defendant raises a defence, it will usually be for him to prove the defence but the standard of proof would be lower than for the prosecution; namely, “on the balance of probabilities”. However, although in the context of burden and standard of proof there are parallels with a criminal prosecution, there are still important differences that mean that there are advantages to obtaining a civil order over a criminal prosecution. The two limbs would act together. We therefore say that this is a civil order; it is a preventive order. You still need McCann and you still need to understand how the two fit together—but within the civil not the criminal framework.
To return to the distinction that emerged in the discussion between the noble Viscount, Lord Bledisloe, and the Minister, are there not two quite different situations here? One is the situation where a serious crime prevention order is sought following a conviction, which will have been based on the criminal standard of proof, as that is all that is needed. That seems relatively straightforward and does not seem to raise any problems under Article 6 of the European convention. But you are in a different situation where there is a third party who has not been convicted of an offence and may not have committed one at all. In those circumstances, one needs to be a lot more careful about how the application for an order is handled. Unfortunately, it seems that the Bill does not recognise sufficiently the difference between those two situations.
I understand the concern raised by the noble Lord, Lord Goodhart; this causes us to look at the matter quite keenly. We think that the way in which we have phrased the provision meets those difficulties. The noble Lord will know that there are situations where the criminal standard, as he rightly says, will have been reached because the individual has been convicted, and we can deal with that. I am grateful to him for accepting the propriety of that position.
Anti-social behaviour orders were mentioned by many noble Lords, including the noble Lord, Lord Thomas of Gresford; but the way in which the breach of the football banning orders was dealt with is an interesting example of the effectiveness of taking preventive action. We were able to identify those who were likely to be engaged in activity, address the nature of their activity and stop them from carrying it out. There has been a dramatic reduction in offences as a result. Arrests for football-related offences were down by 7 per cent and there was 100 per cent compliance with the conditions of the football banning orders during the recent World Cup. We have all done better for it.
These orders will take two forms. Because of the limbs to which I referred, the first being the need to establish whether a serious crime has been committed and the second being on a matter of judgment, the civil standard has to apply. It is a civil preventive order. The civil courts are very used to balancing those two. The Serious Organised Crime Agency has made it absolutely clear that it will want to apply for those orders for those who have been engaged in serious criminal activity. It was suggested that there may have been 25 or 30 such orders. The agency has a spectrum of serious organised crime with which to deal, which means that it has to concentrate its efforts on the most serious criminals to try to disrupt the activity in a way that will reduce crime in our country. It has an enormous job on its hands and it believes that the orders will greatly assist the agency.
I hear what the noble Lord, Lord Thomas of Gresford, says, that it would be good to get rid of the whole of Part 1. That is not the view of those who are burdened, on our behalf, with trying to interdict the serious criminal activity being carried on in our country.
Can the Minister deal with the question that I put? It seems to me that such prohibitions, restrictions or requirements are very wide, almost open-ended and as near to a penalty as could be. Having heard the arguments on all sides, can she reassure the Committee that this particular proposal is human-rights proof according to the convention?
I believe it is. We have looked at this issue very carefully. I have not hesitated to agree with the concerns expressed by a number of noble Lords, both at Second Reading and today, that these orders have to be proportionate; they have to be clearly targeted and used with care and attention. For that reason, the High Court of England and Wales will be entrusted with this task. I know that noble Lords will have felt a great deal of confidence, as I have, in the rigour and vigour with which our courts have scrutinised these provisions. It will be for the court to determine whether either ground A or ground B has been made out. It will be for the Serious Organised Crime Agency, which asserts that that is necessary, to prove to the satisfaction of a High Court judge that the same is indeed necessary.
I believe that that will be quite a high benchmark for the agency to reach. If it reaches it, the court will have had to be satisfied that there are,
“reasonable grounds to believe that the order would protect the public by preventing, restricting or disrupting involvement by the person in serious crime in England and Wales”.
If the applicant fails to satisfy the court to the appropriate standard, an order cannot be made.
I had not realised that there was a reverse burden of proof in subsection (1)(b). The Bill certainly does not make it clear that the onus is on the defendant to prove that there are no reasonable grounds to believe that the order will protect the public. I had read it on the assumption that it would be for the prosecution, or the authority that brought the matter before the High Court, to establish that there were reasonable grounds. Now, we hear something completely different and even more in breach of the European convention. We are not talking about stopping people going to football matches; we are talking about confining people to their homes, preventing them from using their assets—
I respectfully point out that subsection (3) says that the order under the,
“section may contain … such prohibitions, restrictions or requirements … and such other terms … as the court considers appropriate”.
It does not prevent a house-arrest order being made. For example, in the case of a sex offender, the appropriate order might—rightly or wrongly—be to restrict them to their homes, if this legislation goes through. Another way is restricting them from dealing with their assets—their bank accounts and so on. A third way is to prevent them from travelling, whether to the next town or outside this country. Another way would be to impose curfews. The restrictions that can be imposed are absolutely open-ended. The noble Baroness has talked about tailoring; the judge will tailor the order to the particular problem that the defendant poses. This is incredible. The more we look at it, particularly with reverse burdens of proof, the more incredible it appears.
In support of what my noble friend has just said, the Minister should look at Clause 5(6) which says:
“The prohibitions, restrictions or requirements that may be imposed on individuals by serious crime prevention orders include prohibitions, restrictions or requirements in relation to an individual’s private dwelling (including, for example, prohibitions or restrictions on, or requirements in relation to, where an individual may reside)”.
If that is not draconian I wonder what is.
The noble Baroness should understand that we are teasing these things out to produce some sensible legislation, if it can be done in accordance with proper principle. She was kind enough to give the example of a Mr Big who in some way was going to finance lorries with false-bottomed compartments to be used for drug smuggling or people smuggling or whatever. Could she go on and indicate the kind of order that she would anticipate that a court might make in that case or of some other good example?
I have to be really careful because I have about 12 excellent examples in my mind, but I regret to tell the Committee that I understand that all of them are active cases. They would clearly indicate why we need this. I am grappling quickly to see whether I can come up with a different scenario, which would be similar but not identical to those that are under review. Let me try.
A scam could be run in relation to, for example, a school. People are being trafficked to this country, provision is being made for them to attend a school and they get visas on that basis, but no school exists. However, there are premises which have been secured by the Mr Big through which these people can obtain a visa. Third parties may be involved in providing PO box numbers and matters of that sort. You may wish to restrict the individual from obtaining a PO box number to facilitate that sort of fraud. You are looking at how the fraud or the criminal activity is being perpetrated and how you best disable that person from carrying out that fraud. You may therefore require a third party to notify the authorities if that individual were to obtain a PO box. That would not be a general clause but it may be a clause that the court would deem reasonable to apply in the circumstances.
I will now answer the noble Lord, Lord Goodhart. I was trying to say strongly that the noble Lord, Lord Thomas of Gresford, in his usual colourful way was almost saying that these orders will be made to keep people under house arrest unreasonably. I would say that each condition has to be reasonable and proportionate.
I come back to my noble and learned friend Lord Morris of Aberavon. If a condition was unreasonable or oppressive, it would not be consistent with the Human Rights Act. I would be greatly surprised if the court entrusted with this role would be minded to make such an order. The court knows all too well the balance that it would have to strike on reasonableness. It is therefore incredibly important that subsection (1)(b) says that the court,
“has reasonable grounds to believe that the order would protect the public by preventing, restricting or disrupting involvement”.
The person who asserted that there were such reasonable grounds would have to prove it on the balance of probabilities. As I said, it would not be a discernible and identifiable fact; it would be a matter of judgment to which the court would have to come after considering all the facts of the case. Having looked at the information provided, the court would have to make that assessment.
Ultimately, as that is quite a serious assertion, if the court felt that the evidence was of insufficient weight to satisfy the court that it should make an order, an order would not be made. We were therefore very careful when crafting the provision that the lower court would not be dealing with it, as we know how complex and difficult these issues are; it really has to be the High Court, which we believe can be entrusted appropriately and consistently to carry out that balancing exercise. Importantly, to the fore of every piece of legislation is the statement on compatibility with convention rights. The court will have to craft these orders so that they are compatible with the convention rights. The orders will have to be proportionate and just and the court will have to be satisfied that it would be proper to make them. These are not executive orders made by the serious organised crime office or the Government but orders sought from the court and given by the court.
Is the way in which the Bill will work as explained this afternoon compatible with the protection of offenders legislation? Surely the fact that an order has been given will imply previous offences. It will therefore have just as much effect as announcing that the individual who may be seeking high office in a company has a criminal record, in which case he would not be allowed to serve. We are not allowed to do that. Not even the Stock Exchange Council is allowed to indicate to shareholders the criminal record of someone seeking appointment as chairman. However, someone in that position could be subject to one of these orders. By that time it would be too late to take redress because the offence would already have occurred. There is a real problem here. There was a case 20 years ago in which it emerged that a man had run bordellos when he was younger. He later became a more ambitious businessman and went on to become chairman of a public company from which he took £385 million. It would have been much more useful to be allowed to name his previous offences than to bring an order against him.
I am not sure that I entirely understand the concern of the noble Lord, Lord James; but if he is saying that it would have been better to prevent the individual’s action, then I certainly agree. The legislation provides that if an individual had been involved in serious crime, it might be possible to apply to the court—particularly if that serious crime had been perpetrated through the iniquitous use and creation of businesses—for a prevention order concerning that activity.
I may be able to use a somewhat neutered example, if it assists your Lordships. I am trying to be very careful here. I was asked about the haulage company, and we discussed secret compartments. If we could impose a restriction on that haulage company, so that they would have to disclose their customers to the Serious Organised Crime Agency, or further information about those to whom they supplied their vehicles, that could be an order. From that information, the Serious Organised Crime Agency would then be able to follow those individuals, to see whether it would be lawful. These prevention orders can be used in a way that would be helpful to interdict serious crime in the future.
In answering my point, the Minister postulated two categories. First, she was concerned that Mr Big, who had been convicted, would go back to his evil ways. The second category is that of the auxiliary who had assisted by selling him dodgy vehicles with false bottoms. I thought the main purpose of Part 1 was to deal with Mr Very Big who is behind Mr Big, but against whom it was not possible to adduce admissible evidence in a criminal court to get him convicted. Is that person a target of this Bill and, if so, does that not completely disappear if Amendments Nos. 87 and 88 are passed? You will not be able to get at Mr Big—who I thought was Mr Very Big—which I thought was the Government’s main aim.
I agree with the noble Viscount, Lord Bledisloe, that if these amendments were passed, you would not be able to get at Mr Big, but there are a number of Mr Bigs who use a spectrum of smaller agencies in order to perpetrate their large, iniquitous crime. What we must do is twofold. First, we must try to target Mr Big and strip out those steps before one can get to him—those people in the middle. We also have to disable him from taking adventitious advantage of lawful activity which he then uses for his own iniquitous purpose. So you could have a series of people engaged in what on the surface is, individually, lawful activity, but is then used by the serious criminal to his advantage to perpetrate the crime. I gave the example of using PO box numbers and properties with others in a way that makes it very difficult.
The Minister has been patience personified and I wonder if I may stretch it a tiny bit longer by asking if she agrees that even Mr Big, assuming that he is properly identified as such, has his rights. I bring her back to the question put to her more than once by the noble and learned Lord, Lord Lloyd of Berwick, arising from the decision of the Judicial Committee of this House in McCann. In answer to his point she said that even the House of Lords Judicial Committee did not stipulate that an ASBO was a criminal order. I suggest that it does not matter what label you tie around his neck; what matters is the effect the order has upon the person who is made subject to it. If, in the case of an ASBO, the effect is held by the courts to be so serious as to warrant the criminal standard of proof, why is that not going to be their view if this amendment is not carried?
The application to be made under Clause 1 comes in two parts. Those two parts may well, in discharging the civil standard, have different approaches adopted in relation to them. In relation to the first limb, I refer to the seriousness of having to satisfy the court that the,
“person has been involved in serious crime”.
Following McCann, it is reasonable to assume that the court is likely to adopt a standard similar, if not identical, to that of beyond reasonable doubt. In relation to the second limb—the court must be satisfied about both limbs—it is likely that the court would have to be satisfied on the balance of probabilities that it had,
“reasonable grounds to believe that the order would protect the public by preventing, restricting or disrupting involvement by the person in serious crime in England and Wales”.
I do not say that this preventive order relates to a criminal offence or a criminal act in the way that the noble and learned Lord is concerned about. We say that it is a civil order. Within the civil order there is a sliding scale. The court will look at each element and determine where on that sliding scale the burden of proof should lie. Overall, we say that the burden, on the balance of probabilities, because it is a civil preventive order, is the right standard, confident that McCann will certainly bind the court when it looks at these issues. That is why we do not think that it is important or necessary to include “beyond reasonable doubt” in the Bill.
The noble Baroness gave the example of vehicles with false bottoms. The proposal to report orders to SOCA may not sound too serious but would result in the destruction of a person’s business. Given the choice of buying from someone and having your order reported to the police, or buying from someone else and having no such reporting, all their customers will naturally choose to move to an alternative supplier so that they do not have SOCA crawling all over them to see whether they are involved in people trafficking. Given a reasonable level of commercial sense in reporting, which seems to me commonplace, I reckon that it would take about three months for the company to die in those circumstances. The same would be true of many of the examples discussed last night.
As I understand it, facilitating can be entirely innocent. If you are supplying a substance that is used if not widely at least alternatively and which happens to have been used in a particular case for cutting drugs, and you are subject to the order whereby you have to tell the police every time you supply a customer with these materials, your legitimate business will disappear and you will be left entirely reliant on what you may not have known or understood at the time to be a criminal transaction. Effectively, these orders will destroy ordinary, legitimate businesses although they seem in themselves entirely reasonable.
I say to the noble Lord, Lord Thomas of Gresford, that while courts may initially be prepared to act like a couple of kings chasing each other round a chessboard, always trying to occupy the last square that the criminal was involved in, very soon they will find that it is reasonable to impose orders with some teeth that have some hope of anticipating the criminal’s next move. They are very likely to take the form of restricting someone’s movements or the time that they spend out of their house, which is a very easy, convenient and monitorable system. There is absolutely nothing in the Bill to prevent orders evolving in that direction.
I shall first deal with the points made by the noble Lord, Lord Lucas. As regards destroying businesses, we are grateful that SOCA finds that when it addresses legitimate businesses and apprises them of the difficulty that they may have inadvertently been engaged in, they are in the main wholly compliant and there is no difficulty with that at all. The difficulty arises—
Yes, but that is a private transaction between the police and the company, and I would expect a great degree of compliance. If, however, the information were published in an order that everybody could see—the individual would be branded as somebody who has been associating with criminals, as it were—it would be very different.
I can see the fear, but I am advised that it works thus; so far, there have only been difficulties where the business has failed to and/or refused to comply reasonably. For instance, there are those who say, “I am not my brother’s keeper: if I provide this service to an individual and they use it for nefarious practices—whether that is drug smuggling, people trafficking or anything else unbeknown to me—that is not my business”. It might also be claimed, “If I receive a great deal of money for converting a car, which is used for nefarious practices, that is not my business, because I am entitled to get as much money as I can for services that I supply”.
Where there is a refusal to take on board the consequence of that activity, it would be reasonable to apply for an order to ensure that that individual at least apprises the authorities of who the customers are. In some cases with which we are dealing, the business will say, “I don’t know the name of the person or receive any money in written form. I receive it in cash, and there is no way at all that I can help”. In those circumstances, the Serious Organised Crime Agency certainly thinks that impropriety needs to be addressed, if we are to curtail criminal activity.
It has been claimed that the conditions are oppressive. Noble Lords will know—we have been debating them a great deal regarding actions taken under SIAC—that if conditions are applied that amount to house arrest, a derogation from the Human Rights Act would be needed. We have no derogating orders in this country; therefore any condition attached by the court would have to be HRA-compliant; otherwise, I am sure, it would be struck down.
I can certainly write to noble Lords to give further and other such cases that we are dealing with and that may assist. Indeed, Sir Stephen Lander was able to explore many of those with us last night, but, as I have explained, it would not be proper for me to further explore them in the open forum of this Committee.
No, they are not in contravention because it is reasonable to suppose that the regime we have put in place would be operated by the High Court in a way that would comply with the Human Rights Act. I am therefore confident that these provisions, which are similar to how provisions were made for football banning orders or anti-social behaviour orders, are HRA-compliant.
I thank the Minister for her explanation, but she will have noted the concern of almost all the noble Lords who spoke. Our aim was to tease out as much information as we could from the Minister; I hope that she will reflect on today’s debate, which has taken just over an hour. We on this side are uncomfortable with what we have heard so far, but there will be an opportunity to come back to this matter on Report. I hope that that will be a more challenging time for the Minister. In the mean time, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
3: Clause 1 , page 1, line 10, at end insert “; and
(c) it is satisfied that it is not possible to prosecute the person for a criminal offence.”
The noble Lord said: The amendment has been grouped with Amendments Nos. 5 and 9 and would restrict the ability to make serious crime prevention orders in situations where the High Court was satisfied that it would not be possible to prosecute a person for a criminal offence. It would require criminal investigations to be continued following the making of an order, with a view to a criminal prosecution.
We suspect that serious crime prevention orders would become an unacceptable legal short cut and make it possible to punish individuals without the administrative inconvenience of fair trials and due criminal process. The government response is that that is not the aim, and they argue that these orders are needed to deal with cases where a criminal prosecution would not be possible, and that the orders are therefore the only options.
In the debate of 7 February the Minister said:
“I know that in the press coverage of the publication of the Bill there has been much mistaken comment about these orders being a way for law enforcement agencies to get around troublesome prosecutions. I assure the House that that is not the intention”.—[Official Report, 7/02/07; col. 729.]
That assurance is not a sufficient guarantee. Nothing in the Bill would prevent a serious crime prevention order being used as an alternative in cases where a criminal prosecution would be entirely possible but where it was thought either to be too troublesome due to the fair-trial hurdles that would need to be crossed or not to provide a sufficiently broad range of remedies.
The predecessors of these orders, ASBOs and control orders, which the noble and learned Lord, Lord Lloyd, mentioned, demonstrate the need for express safeguards to be included in the Bill. It has been common for ASBOs to be used as an easier alternative to a criminal prosecution, because it is more straightforward to collect and rely on hearsay evidence. Parliament was similarly concerned that control orders would be used as an easy alternative to criminal prosecutions for those involved in terrorism, and insisted that a provision be included in the Prevention of Terrorism Act 2005 that required the possibility of a criminal prosecution to be considered before a control order was made and for a criminal investigation to be continued following the making of the order.
Notwithstanding that provision, it appears that incomplete consideration has been given to the possibility of prosecutions prior to the making of control orders. That was one of the reasons why the High Court decided on 16 February that the Home Secretary had exceeded his powers under the PTA 2005 and, therefore, quashed the control order. There is every reason to fear that the ability to deal with a serious crime by using an order will remove the incentive to pursue a criminal prosecution.
Our amendment would ensure that that was not the effect of serious crime prevention orders and would thereby safeguard the Government’s intention, expressed by the noble Baroness, Lady Scotland. The amendment would require the High Court to be satisfied that a person could not be prosecuted before making a serious crime prevention order and that all appropriate lines of criminal investigation were pursued diligently following the making of an order. I beg to move.
Does the noble Lord accept that the amendment is totally incompatible with those that we have just debated? The judge can make an order only if he has been satisfied beyond reasonable doubt on evidence admissible in a criminal trial that the man in question has been guilty of the criminal offence. If he is satisfied, he cannot be satisfied that it is not possible to prosecute the person unless the individual is outside the jurisdiction. I do not think an order of this kind can be made against somebody not within the jurisdiction, but the two cannot stand together. A judge cannot say that he is satisfied beyond—
Yes, I accept that, but is it accepted that these orders can only be used against somebody who has already been prosecuted and served his penalty and invoked as a further punishment? If so, most of their purpose has gone. Is it accepted that that is the only circumstance in which you could satisfy Amendments Nos. 2, 87, 88 and 3?
There are some internal inconsistencies in these amendments, but I took it that this amendment and the earlier one were probing, so maybe the inconsistencies can be viewed in that context. The amendments reflect a fundamental misunderstanding of the purposes behind the Bill and how it will work in practice. Nothing proposed in legislation alters the role of the applicant authorities in deciding whether prosecution should be sought against an individual. The Government are committed to ensuring that those who commit serious crimes are caught and punished, and it is very clear from discussing these matters with the Serious Organised Crime Agency that it shares that view. Part of its business is to take out and restrict the activity of serious criminals and make it more difficult for them to perpetrate their crimes.
Nothing in these orders is to do with punishment. The purpose, as I have tried to make clear in earlier debates, is preventative, and Amendments Nos. 3 and 5 would mean that, before being able to consider an order to prevent future harm to the public, the applicant authorities would have to seek prosecutions against the persons concerned for every crime they had ever committed. Your Lordships will know that in making decisions the prosecution may often decide that a particular crime could be prosecuted but in the public interest it would not be appropriate under the circumstances.
This judgment process remains unchanged by this Bill. However, irrespective of whether a prosecution has been or will be sought, the Bill leaves it open to the applicant authority to seek to demonstrate to the High Court that a person has been involved in serious crime and that the proposed terms of an order will prevent, restrict or disrupt involvement in serious crime. One knows that on occasion some very complex cases take a very long time to come to court, and it may be necessary and appropriate for the agency to apply to the court in the interim for orders to restrict the activity that the criminal could participate in while that time frame prevails. The decision to prosecute an individual and the decision to apply for an order to prevent harm to the public are two completely separate issues based on different criteria. For that reason it would be inappropriate to restrict the ability of the High Court to impose a reasonable and proportionate means of preventing harm simply because a prosecution for an offence has not been sought for a legitimate reason.
I have some sympathy with the intention behind Amendment No. 9. It sets out expressly that the making of an order is without prejudice to any criminal investigation and that, once an order has been made, the investigation of the subject of an order must continue to be pursued. Appropriate prosecution of the people who have committed serious crimes will always be desirable, and these orders do not rule out that possibility.
As I said, the orders will be preventive and will be used as part of the criminal lifetime management of those engaged in serious crime. They may prevent harm while investigations are ongoing or they may help to stop a person re-engaging in serious crime after they have been convicted and have served a sentence. At Second Reading, the noble Lord, Lord Dear, gave us a very graphic example of some of those cases and of how long they can take to come to fruition and go before the courts.
The making of an order will not rule out the possibility of a criminal investigation continuing but we do not believe that there is any need to say so expressly, as in paragraph (a) of the amendment. As for paragraph (b), we do not think that it is appropriate to require law enforcement to continue to pursue an investigation. We believe that it is more appropriate to give law enforcement officials discretion to manage each case based on its facts. For those reasons, I hope that the noble Lord will see that there is great sense in approaching this matter in the way that I have just described.
Does the Minister agree that, if a prosecution is pending or contemplated, a person should be charged? Under the requirements of a serious crime prevention order, the court has to be satisfied that a person has been involved in a serious crime. If a person is charged, he is let out on bail pending the trial. Are there any conditions in Clause 5(3), for example, that could not be imposed on a bail order?
There may be orders referable to individuals’ business dealings; for instance, providing that they comply with or give information to Her Majesty’s Customs and Excise or SOCA. That is not a usual bail condition. It would be much easier for the court—and, one imagines, more proportionate, particularly if we suggest that there is some interference with the individual’s business activity—if the Serious Organised Crime Agency were put to the trouble of going to a High Court judge, who could balance these issues and see whether it was a proportionate and reasonable response. The provision does not mean that some of these conditions could not be bail conditions, because they could, but some of them might be better placed, and the response might be more proportionate, if they were made under a High Court judge’s determination, particularly in relation to business issues, which could be better balanced.
These are tools. By creating these orders, we will put another tool in the prosecution’s tool box, but the provision does not mean that all the tools have to be used in any given case. The most judicious judgment will have to be made about which tool needs to be used in any individual case with which the Serious Organised Crime Agency is dealing.
I thank the Minister for her explanation. I also thank the noble Viscount, Lord Bledisloe, for his observations. We have an opportunity to look again at what revisions to the amendments might be necessary and at whether our concerns can be expressed differently. On that basis, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 4 and 5 not moved.]
6: Clause 1, page 2, line 4, leave out “may contain” and insert “must prescribe”
The noble Baroness said: My objective in tabling the amendment is to ask the Government to explain to the Committee how they expect the courts to announce in court the terms of a serious crime prevention order. Exactly how much detail is the judge expected to give? Of course, as the Minister sought to explain earlier, there is a two-limbed approach in Clause 1. It enables the High Court to make a serious crime prevention order against a person if that person has been involved in a serious crime and the test is satisfied that there are reasonable grounds for believing that the order would protect the public. We have discussed in some detail noble Lords’ concerns about the use of the civil burden of proof.
Regardless of how the noble Baroness has sought to reassure the House, the fact remains that we are being asked in Clause 1 to extend the use of civil orders against those who are only alleged to be involved in crime, and to do so in a significant and serious manner. An order could be imposed on a person who has never been convicted of a criminal offence or against whom no criminal proceedings have ever been instituted. Yet, despite the serious nature of the new orders, it appears that the court could be mysteriously vague in giving information in court as to the terms of the order, whose breach could lead to a person losing their liberty. We shall see in later debates on other amendments that orders can also have a significant adverse effect on third parties—something to which noble Lords, including my noble friend Lord Lucas, have already referred.
Paragraph 15 of the Explanatory Notes states:
“Subsection (3) provides that the Court may impose such terms in the order, whether prohibitions, restrictions, requirements or other terms, as it considers appropriate so to protect the public by preventing, restricting or disrupting the involvement of the subject of the order in serious crime”.
But Clause 1(3) merely provides:
“An order under this section may contain”.
So my amendment is very much a drafting amendment, which, to use the noble Baroness’s phrase, uses a tool to make the court—I would hope—act more clearly in giving information. We say that an order “must prescribe” what the person must or must not do. The amendment is a device to ask the Minister to set out what information she expects the court should be giving about the behaviour expected. If it is left too vague, there is surely a danger that the order’s objective—the protection of the public—would not be achievable. Is the court expected to give its reasons why and how a particular prohibition or restriction on a person would either specifically disrupt that person’s involvement in serious crime or protect the public? Will the court have to explain why that prohibition or restriction is not a punishment but is preventive? Will the court explain what impact it expects the order to have on third parties and how it has taken that into account in determining the terms of the order?
The experience of ASBOs and control orders suggests that the restrictions imposed in an order may well be drafted in an uncertain manner. Numerous cases have been brought by those subject to control orders who were unclear whether certain actions would put them in breach of their orders. Similarly, the uncertain nature of some ASBOs has been criticised in the higher courts.
Clause 5 gives examples of what an order may provide; we will debate later the precise nature of those prohibitions. We see Clause 2 as the “Open Sesame” for a court to give what could amount to home detention over a period. The noble Baroness has already assured us that that is not the intention, but we shall need to look at the serious implications of the prohibitions and restrictions that could be imposed.
It is important to hear at this stage from the Minister what kind of detail the court is expected to announce in court to give clarity, certainty and, we hope, achievability to the terms of an order if the Chamber agrees that those should go forward. I beg to move.
Will the Minister in her reply undertake to deal with the provisions in Clause 5(7), which, on several readings, I find extremely confusing? Incidentally—and this is important in the light of our earlier discussions— that subsection includes provision conferring discretion on law enforcement officers to impose “prohibitions, restrictions or requirements”. Law enforcement officers are defined to include, for example,
“a member of the Serious Fraud Office”.
First, taking up the final point made by the noble and learned Lord, Lord Mayhew, I should make it clear for the whole of our debate that the Serious Organised Crime Agency is not the only agency that can apply for the orders. Subsection (8) sets out all the individuals who are covered by what “a law enforcement officer” means.
I turn to the first point made by the noble Baroness. I understand what she says about the amendments. If one looks at how anti-social behaviour orders have developed—many of them are, as she will know, made by a lower court—the High Court has had to direct and inform how they have been expressed because, on occasion, they have lacked the acuity that we need. I think that that is the import of her amendment.
That is why we chose the High Court as being the most appropriate court. As the noble Baroness will know, the authority that seeks to make the orders will have to file evidence and satisfy the court that the order that it seeks is justified on the evidence that it produces; it will have to satisfy the court that the order is right and proper, and consistent with the provisions not only of the Bill but of the Human Rights Act. In order to make a valid order, the court would have to express that order with sufficient clarity so that it can be enforced if breach is alleged.
The process and the rules that apply to proceedings in the High Court on orders made by the High Court would all apply to such applications. We anticipate that the court would be obliged to give clear reasoning and explain the basis on which it made the order. As the noble Baroness knows, we have provided for a right of appeal, which would not be possible without knowing precisely the reasons for granting the order and the basis on which the court asserted that it was satisfied that the two limbs of Clause 1 were made out.
I understand the anxieties of the noble Baroness, but I do not believe that those anxieties are well founded. The court would be expected to set out the terms of the order. All the terms of the order must be set out on its face for it to be capable of being enforced. The only exception will be if the order relates to provision of information. Then, the court may leave the details of how the information is to be provided to the discretion of the law enforcement officer. That is in Clause 5(7). As the noble and learned Lord, Lord Mayhew, said, that subsection is rather broader at the moment, but we shall return to that issue. It may be appropriate to amend it, subsequent to our discussion, to give it greater acuity than it has at present.
Just as with any other injunction, the High Court judge will have to set out on its face the person to whom the order relates, the nature of the restriction made and the terms with which the individual must comply. I imagine that it will be possible to challenge an order that did not comply with those ordinary rules.
I hope that that gives the noble Baroness the reassurance that she seeks. I agree with her that it is very important, when dealing with orders of this nature, to be clear about the terms and to be clear with a person who may be subjected to it, so that there is no difficulty or misunderstanding about compliance. I hope that what I have said will give the noble Baroness the reassurance that she seeks.
I am grateful to the Minister. She has taken me some way forward to seeing whether we might be able to resolve our concerns. I am grateful to my noble and learned friend Lord Mayhew of Twysden for referring us forward to Clause 5(7). I have tabled Amendments Nos. 60 and 62 on that matter; the former seeks to leave out subsection (7) and the latter leaves out the reference to the power of the law officers to determine at a later stage what prohibitions might be imposed on a person. The way in which the Minister has addressed my noble and learned friend’s comments today has given me some thoughts about how we might approach Amendment No. 60 when we reach it. There may be some way in which we can achieve a resolution, whereas previously I was concerned that we might not, so that has been constructive.
I agree with the noble Baroness that we are all trying to ensure that the provision is watertight so that there will be compliance—otherwise everyone’s time is wasted and the person still goes on to participate in serious crime, which none of us wishes. I am grateful to her for setting out how she sees the court’s role in those terms. It is helpful to have that on the record because, if there is not sufficient clarity in the terms of the order as announced in the court, breach cannot be pursued. That is in no one’s interests, so I look forward to seeing with perhaps different eyes than I would otherwise the arguments that we might be able to adduce when we reach Amendments Nos. 60 and 62, so that perhaps we can achieve a resolution on those matters. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
7: Clause 1, page 2, line 5, leave out from “requirements” to end of line 6
The noble Baroness said: I shall speak also to Amendment No. 79, which is consequential, as it refers to the powers of the Crown Court, which follow closely on those governing the High Court in Clause 1. We wish to probe the meaning that lies behind the Government’s use of the phrase “such other terms” in Clause 1(3)(b). Clause 1(3)(a) states that the court may impose “prohibitions, restrictions or requirements”. That seems to cover every eventuality that one could dream up and certainly everything that we will come to later in Clause 5, where there are examples of what could be imposed. Those cover such matters as where one can live; whom one can see; whom one can talk to and indeed whether one can communicate with anyone at all; whether one can have a mobile phone, computer or e-mail; and whether one can travel, either in this country or overseas, or whether one remains at an address to be determined by the court. It covers matters such as whom one may employ and what documents one must—not “may” but “must”—reveal to the police. The list seems exhaustive. Our simple amendment asks what is added to the court’s range of powers by the words “such other terms” in Clause 1(3)(b) that would not be covered adequately by paragraph (a). I beg to move.
I thank the noble Baroness for the way in which she spoke to her amendment. This goes back to some of the comments that I made on earlier amendments. We are trying to give the courts a degree of flexibility so that they can tailor an order to best fit the circumstances of the case under consideration. We have been conscious that technology moves quickly and we want the legislation to stand the test of time, so we think that judicial flexibility, which would be limited by virtue of the reasonableness of the provisions and compliance with the Human Rights Act, would be an important advantage.
Clause 1(3) and the corresponding provision in Clause 19 allow the courts to impose positive as well as negative obligations on the subject of the order. Under an order, a person can be required to take action as well as not to take action, but always subject to the requirement that the terms must be preventive rather than punitive. We do not wish to see these provisions restricted in the way proposed because we do not want the courts to refuse to make an order simply because a particular term cannot be described as a prohibition, a restriction or a requirement. Rather, the courts should be able to impose those terms that they consider will prevent harm. They will have to justify and explain them, and make sure that they are human rights compatible, that they are not oppressive and that they are proportionate, but we believe that they should be entrusted with the opportunity.
I hope that having heard my response, the noble Baroness will be content that these provisions do not cause the worry about which she might be concerned.
This may be another example of “yes but no but yes”, but perhaps it is a yes. I really sought to ask what else, if we have in Clause 1(3)(a) “prohibitions, restrictions or requirements”, there is that the courts might wish a person to do under an order. The noble Baroness says that the provision in paragraph (b), “such other terms”, could mean that the courts would impose positive obligations. If one accepts the idea of a serious crime prevention order, a positive obligation could in itself be an appropriate measure. On the other hand, in my thinking a positive obligation is a requirement to do something. This is certainly something that I shall want to think about because I am not sure whether the paragraph adds anything to the Bill. However, if it does no damage, I shall not be concerned. At this stage, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
8: Clause 1, page 2, line 11, leave out “6 to 15 (safeguards)” and insert “5 to 15”
The noble Baroness said: I shall speak also to Amendments Nos. 52 to 59. We are now referring to Clause 5 because the first amendment is in a sense a paving amendment to refer to the issues in Clause 5. We have already considered the fact that Clause 5 gives examples of what may be the prohibitions, restrictions and requirements imposed by an order. My amendments would convert those examples of what the courts can do into a finite list which would say, “These are the things you can require people to do, but you cannot in the future just make up your mind to add anything else”. The Government are always careful to describe ASBOs, control orders and now serious crime prevention orders as preventive rather than punitive, and we have had long debates on that in relation to earlier amendments. Earlier today, for example, the Minister said that a restriction on international travel would be what I believe she called a “preventer” against international crime. My noble and learned friend Lord Mayhew of Twysden pointed out in the same debate that what one has to look at is the effect of an action—not what you call it, but its effect.
Members on these Benches have a problem with the Government’s insistence that these are preventive measures. We are not convinced. An order does not become preventive just because one calls it that. Further, the examples listed in Clause 5 certainly have the ring of punishment about them. As the briefing from the Criminal Bar Association sent to noble Lords today points out, the consequences of serious crime prevention orders are highly punitive. The noble Baroness has said that they would become punitive only on breach. The Committee will have to decide whether it is punitive before that stage because Clause 5 provides an extensive, non-exhaustive list of prohibitions, restrictions and requirements that the order could impose.
When asking the Public Bill Office’s assistance in drafting the text of this amendment—as ever, I thank the staff for their exhaustive work on my behalf—I started from the premise that I heartily dislike legislation by examples. It lacks the clarity and certainty that we expect, and have a right to expect, from legislation. It is important that the Government should be asked to justify why they have chosen this method of giving examples, why they rejected other methods of drafting the clause and why they need to list the prohibitions merely as examples—what else could be added that could possibly be appropriate and proportionate?
I shall briefly mention the text of the amendments. Amendment No. 8 simply amends Clause 1 so that the powers of the court in imposing an order are subject to Clause 5 in addition to Clauses 6 to 15—they are all consequently designated as safeguards. That makes it possible for us to convert the examples in Clause 5 into the finite list, and Amendments Nos. 52 to 59 do just that. I beg to move.
We on these Benches wholly support the amendment. The use of the expression “examples” introduces an entirely vague concept, and the net result of Clause 1 as it stands in relation to Clause 5 is that it gives the judge complete control over any type of restriction, requirement or prohibition that he chooses to impose. That is not right. I have the highest regard for High Court judges, of course, but it is not right to give such power over the individual to a judge in such circumstances. Then there are simply set out examples, which of course include house arrest—the Minister looks upset at that, but why doesn’t she face it? It is house arrest to restrict the use of any premises by an individual and to restrict an individual’s travel. This provision can be used in that way in what a judge thinks is an appropriate case. If the Minister does not like emotive expressions, I am sorry, but that is what it means.
I am concerned by the noble Lord’s insistence on “house arrest” because the Committee knows that the courts of our country will not allow that to occur, as house arrest would be disproportionate. Indeed, it would be argued that it was an improper infringement on the liberty of the individual and contrary to the provisions of the Human Rights Act.
We currently restrict a whole series of individuals’ activities. The noble Lord, Lord Thomas, mentioned one earlier: we restrict, with propriety, the activities of known paedophiles, who are on a register. We require them to live at a certain address and comply with certain conditions because it is necessary so to do for the prevention of injury to others, particularly children. It is not suggested that that interference with liberty is disproportionate to the risk and danger that they pose, and I do not believe that any of us could, with propriety, refer to that as “house arrest”. If it were, we would have to derogate from the Human Rights Act, which we do not intend to do.
With the greatest respect to the Minister, we know that control orders restrict people to their houses. People are kept with their families in a flat and are not allowed to move outside it. That is house arrest. We have it already, under legislation passed by this Government. This provision is a further extension of the possibility of house arrest.
The Minister refers to paedophiles, because they are the demons in our society. The Bill does not require that it be proved beyond reasonable doubt, so she told us only an hour or two ago, that they are paedophiles for house arrest to be imposed. That is the authoritarian nature of this Bill, which we keep coming back to.
I do not think that it will advantage the Committee for us to rerun our debate, which lasted over an hour. Perhaps I can import into this debate the comments that I made in the last; it may assist the Committee if we deal with it in that way.
I turn to the amendment of the noble Baroness, Lady Anelay. She invites us to turn the list in Clause 5 into an exhaustive one. I pray in aid the comments that I made on the two previous amendments about flexibility and the need for acuity in crafting conditions that go to the root and the nature of the individual criminal activity that these orders are designed to prevent. On each occasion, they will differ: the way in which one frames order A will differ from the way in which one frames order B. Any terms imposed by an order would have to be compatible with the convention rights, as required by the Human Rights Act 1998.
The provisions are also subject to numerous safeguards in Clauses 6 to 15. For example, Clause 11 provides that a person does not have to give oral answers to questions. The flexibility in Clause 5 allows a targeted order to deal with particular circumstances.
With regard to the examples that we gave earlier, a business could be involved in obtaining mailshots. People are invited to participate in a competition that is not real. In practice, the prizes that are offered do not exist or, if they are offered, are worthless. There is no commercial rationale for the operation; its sole purpose—obtaining the mailshots—is to identify likely future candidates for advanced fee fraud. If the perpetrator then sells or obtains a mailshot elsewhere, the law enforcement officer can apply for a prevention order prohibiting that individual from engaging in any activity involving large-scale mailshots.
We know that scams of this nature are taking place up and down our country; while many of them are perpetrated by individuals who are not in this jurisdiction, the mailshots take place here. There have been tragic cases of individuals who have lost their entire life savings as a result. As a preventive measure, it would be important to target the serious organised crime, in that instance by obtaining an order to disable that particular individual from appropriating money in that way. The irony is that, had we given no example of the nature of the activity that we wish to interdict, it could have been said that this is even broader, but we have tried to give the framework within which these orders should be set. However, we do not propose that they should be exhaustive.
I know that the noble Baroness is a practical individual; she always looks to see what the mischief is and how to frame the response to deal with it. I am confident that neither she nor Members of the Committee would like to disable the court from responding in a proportionate way that was likely to interdict crime that is serious and so invidious and detrimental to the citizens of this country. That is why we have done it in that way; we hope that the framework gives a proper balance between the acuity and the flexibility that one needs. I hope that, given that explanation, the noble Baroness will be slightly happier than she was before I responded.
I am getting more and more sympathetic to the Minister personally in her struggle to explain why the Bill is necessary. She has convinced me of the need for something that can be targeted in these cases. I do not go along with what we are being told by Liberal Democrat Members that, because the Bill is vague, we cannot have anything. I do not think that that is the case. But it is extraordinarily vague to leave to a judge of the High Court a decision about how to push this or that person about, Parliament not having agreed that that could happen. That is what we have got. The examples do not include parameters. That is the trouble and that is what my noble friend is trying to say.
It is Parliament’s duty to ensure that the courts do what it decides and do not do what it does not decide. That is what we are here for, as I understand it, and I have always thought that it was an important and noble role. But it is not our job to say that we need any sort of an order to be possible because the variety of needs will be so great, and that we must let the judges decide everything. That is the trouble. I think that that is what Liberty is saying to us. That organisation has written an extraordinary document and to my mind has taken a lot of trouble to point out what the problems are from the point of view of lawyers. The ordinary citizen wants to know that Parliament is giving judges parameters, but there are none in this case.
I absolutely understand the nature of the concerns of the noble Baroness, Lady Carnegy of Lour, and thank her for her sympathy. But we have the examples in the Bill to try to do what the noble Baroness suggests—set the parameters. We are fortunate because the High Court of Justice in our country has, in its inherent jurisdiction, long experience of doing this sort of thing. For example, in wardship, the High Court can do anything to protect a minor from the wrongful removal from a jurisdiction or from harm. In the recent Children Act 2004, we retain—I think in Section 100—the ability to make an order in wardship if all else fails. We have entrusted in the inherent jurisdiction of the High Court the ability for a High Court judge to make proportionate orders that seem to be right in the circumstances of that particular case.
So this is not by any means unknown, albeit the noble Baroness is right that in more recent legislation we have tried to set out clear boundaries within which the court should operate and clear rules about how they should apply the tests that we have given them. That is why we have provided the tests in Clause 1 and the parameters which we have just been discussing in this amendment. In terms of proportionality, we also have the Human Rights Act 1998 as a further constraint on their operation. Of course, a court would not be able to make an order that was unreasonable or inconsistent with the Human Rights Act. If they did so, the Court of Appeal and/or the Judicial Committee of the House could strike down any such order. We know from our most recent jurisprudence that the court has been very vigorous in being guardians of the Human Rights Act and making sure that that which is done is compliant.
I understand the noble Baroness's concerns, but we believe that we have got the balance about right on this occasion. We must have a little flexibility. Otherwise, to put it colloquially, we will not be able to catch the pernicious crooks fairly.
I am grateful to my noble friend Lady Carnegy of Lour because she highlighted exactly my concern that it is a case of ensuring that there are parameters and that Parliament takes proper responsibility for setting the boundaries within which the judiciary then acts in specific cases. I am concerned that there is so much flexibility and lack of clarity that there could be problems. However, I agree entirely with what the Minister says. There are ways in which one can have safeguards in other parts of the Bill. Therefore, my paving amendment was purposely in Clause 1 because I accept the Minister's argument that Clause 1 of itself does impose on the courts parameters that set the scene before they get to Clause 5. I appreciate that I will always have to look at Clause 5 within the terms of what steps the court has had to go through before it reaches that.
The noble Baroness and I are also at one in wanting to get at the pernicious people who may well be dealt with properly by some of the examples given in Clause 5. In particular, the noble Baroness mentioned the case of those who compile what are called “sucker lists”. They carry out mail shots that offer prizes that may not exist or, if they do, are worthless and when people reply, not only do they have to phone a premium-rate phone line, but their details go on to a sucker list which is sold on, as a big-business effort, not only to people in this country who exploit them, but also all around the world. Cases have been well set out in newspapers, particularly in the Sunday newspapers in the money pages, of vulnerable and elderly people—“vulnerable” and “elderly” do not necessarily go together—whose lives have been ruined by these people. The noble Baroness is always very good at presenting to us the hard case which would make us bite our tongues and accept the argument of the Government; “Oh, well, we’ll take what the Government propose because it could catch these serious criminals”.
I agree with the noble Baroness in everything, except that I need to look very carefully at the detail of Clause 5 and whether part of it towards the end may need to be amended to make it a little less flexible and to give it a little more clarity, without undermining its purpose. I shall consider that before Report stage. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 9 not moved.]
10: Clause 1, page 2, line 11, at end insert—
“( ) The making of a serious crime prevention order against a person in relation to people trafficking shall—
(a) be without prejudice to any criminal investigation; and (b) require that all appropriate lines of investigation shall be diligently pursued with a view to bringing a prosecution against the person for an offence relating to trafficking against persons.”
The noble Lord said: The press coverage surrounding the introduction of the Bill announced that serious organised crime prevention orders would be used to tackle human trafficking. The Minister mentioned human trafficking in her opening remarks when she spoke of why such orders are necessary.
We have no doubt whatever that human trafficking is a serious social evil, causing great human misery. However, we doubt the wisdom of relying simply on serious crime prevention orders as a means of tackling this horrendous crime. Instead of relying on these legal shortcuts, we believe that those who traffic human beings for exploitation should be prosecuted and, if convicted, punished. Criminal prosecutions and prison sentences for those found guilty of these serious offences would be a far more effective way of providing justice to victims—a visible deterrent against future trafficking and protection of the public. That is the approach taken in the trafficking convention, which requires states to put into place a range of trafficking offences and to ensure that cases are investigated and prosecuted effectively.
We are delighted that the UK has now put in place a range of trafficking offences and that it intends to give them extraterritorial effect. Enacting offences is not, however, enough; more can and must be done to facilitate criminal investigations and prosecutions. We are not, for example, aware of any prosecutions being pursued under the offence of trafficking for labour exploitation, enacted in 2004. One significant difficulty with prosecutions in that context is the immigration status of the victim. Victims may be unwilling to come forward to assist with an investigation for fear that they may be deported before they have had time to consider properly whether they are willing and able to help with a criminal prosecution; or may even be deported during the course of an investigation or prosecution with which they are actively assisting.
In the short term, the single most important factor that enables victims to make decisions, both about their future and whether to assist in a prosecution, is security. It is for that reason that the trafficking convention provides for reflection periods, limited residence rights and support for victims.
After much hesitation on this issue, it is now clear that the Government do not object to giving limited residence rights and reflection periods to trafficking victims. That is very welcome. We are delighted that, on 23 January, the Prime Minister announced that the UK would sign up to the trafficking convention and presumably give domestic legal effect to its provisions. The amendment is an attempt to probe the Government on this matter and to ask them whether they will introduce into UK law those provisions of the convention that are widely considered to be the most important to ensure that victims are willing and able to assist with criminal investigations and prosecutions of human trafficking. I look forward to the Minister's explanation on this matter. I beg to move.
There can be no doubt at all that trafficking is a great social evil. I am grateful to the noble Lord, Lord Dholakia, for bringing this matter forward in a separate amendment which highlights its importance. Research reveals that between 700,000 and 2 million women and children are trafficked across international borders every year; 60 per cent of illegal immigrants resident in this country arrived here illegally and the majority in the back of a lorry. The noble Baroness has already referred to the difficulty about investigating that and the fact that some lorries are built specifically to accommodate such human cargo. There were an estimated 4,000 victims of trafficking for prostitution in the United Kingdom during 2003 and we know that there were 30 convictions for trafficking offences between 2004 and 2006. To date, as the noble Lord, Lord Dholakia, has said, as far as we are aware, no convictions have been achieved for trafficking for labour exploitation.
This is a serious matter and one to which the House will return tomorrow during a debate on International Women's Day. My noble friend Lady Morris of Bolton will lead for us on that day. I know that she intends to look very carefully at these issues.
We are very glad that, after some hesitation, the Government agreed to sign up to the convention on trafficking—the European convention—and we hope that ratification will take place as soon as humanly possible. I would be grateful if the noble Baroness were able to give us some updated information on that. What progress has been made towards ratification? Perhaps she could comment on the results of her 2006 consultation paper, Tackling Human Trafficking, and the work undertaken by the Human Trafficking Centre, opened in Sheffield last October. I have a reason for asking those questions within the context of this very helpful amendment.
This morning, I heard on the radio a news item which said that in this year of commemorating—I hate to think of it as celebrating—the abolition of slavery, and slavery should never have happened in this country, the Metropolitan Police are launching a specialist trafficking team. I thought that sounded very helpful. I was already aware of Operation Maxim, which is the Metropolitan Police Service’s partnership with the UK Immigration Service, the Identity and Passport Service and the Crown Prosecution Service, targeting organised immigration crime across London. They specifically target human trafficking. I knew about that, but this appeared to be a new initiative.
Afterwards, I tried to find out the details and I went on the Metropolitan Police website and found nothing; I went on to the BBC information website—the BBC had put out the story—and found nothing; so I was becoming more and more confused. The story was repeated, so I knew the confusion was not in my head, thank goodness. I would be grateful to know whether the Minister has any information to assist the Committee on the remit of that trafficking team and how it might interact with SOCA. That will be important against the background of the briefing given to noble Lords last night. How would the roles of the team and SOCA differ or complement each other? Will the focus of the Metropolitan Police team be on seeking criminal prosecutions or on identifying those cases where it might be more appropriate to seek a serious crime prevention order?
I now do my elliptical loop and come back to my first comments about the scale of the trafficking problems in this country particularly and worldwide, and the comparative lack of success of prosecutions in the criminal courts and therefore the potential for the use of a serious crime prevention order in resolving some of the problems. The noble Baroness has argued that we should accept this new “tool”, as she calls it, because it could solve problems that we do not seem able to solve at the moment. There may be an argument in the case of trafficking that an order could be a useful tool. I still need to be persuaded but it is one of the areas where there could be a valid argument.
It is important that we know the status of the Government’s work with regard to trafficking and the ratification of the convention, as well as the status of the new trafficking team and how that is going to relate to SOCA. Is its main focus going to be on criminal prosecution or is it going to be moved away so that in the future it will focus on applying for a serious crime prevention order?
I am grateful to the noble Baroness, Lady Anelay, for giving us some figures about trafficking. Of course, they can only be indicative ones because there is no precise knowledge. However, they point clearly to the major scale of this totally unacceptable practice. I mention that to the best of my knowledge there have been approximately 30 successful prosecutions of traffickers so far. Have there additionally been some unsuccessful cases?
When she comes to reply could the noble Baroness also indicate when Operation Pentameter is likely to be repeated? I hope that it will be very soon this year. It was successful as far as it went first time round.
Ratification of the convention has been mentioned. My strong hope is that signing will happen before the end of March and ratification will follow as soon as practically possible thereafter. I have three Questions for Written Answer down about what changes in legislation will be necessary before we can ratify the convention; I hope we can have a positive answer about that.
Finally, how do we deal with traffickers? Will successful action against traffickers count towards the targets of the various police services and towards the efficiency points which they earn by the work that they do? As to the amendment, like the noble Lord, Lord Dholakia, I would prefer to see traffickers being prosecuted rather than hobbled or to some extent interrupted in their activities by these orders. I look forward to the reply.
I support the points made by my noble friend, Baroness Anelay, particularly in the context of trafficking and lorry drivers. The Minister will be aware of the case of Roth v the Home Office in which the 2001 Act crashed. The provisions for the confiscation of lorries, for demand for immediate payment of £2,000, and for a complete change in the rules of criminal procedure—denying the normal rules of procedure in circumstances which plainly involved a criminal penalty—meant that the Act was struck down. This was all in relation to the problem of illegal immigrants and the use and abuse of lorries coming into this country. The Government tried to control that and they were right to try, but it was not done in the right way. It was not proportionate or compliant with the Strasbourg court. We wish the Bill to succeed in the sense that we all wish to combat effectively this type of serious crime. We are testing it because we do not want to make those same serious mistakes again.
Against this background, one of the problems in 2001-03 was that at Sangatte—the refugee camp near Calais and the entrance to the tunnel, and the place at which lorries are marshalled before driving on to cross-Channel ferries—there was absolutely no provision for the kind of electronic surveillance, mechanical or physical, which would have made a difference. I suspect that the Home Office is more up to speed on that now. I hope the noble Baroness will confirm that we have the kind of mechanical or technical facility which will show whether lorries driving on to vessels or into the Chunnel are carrying illegal immigrants. A great deal can be done technically; we know that because the United States has been down that route and is doing it successfully on the borders with Mexico. Before we decide to take procedural action, or action to change our criminal law and our normal rights and liberties, will the noble Baroness confirm that we are doing the right kind of things at Calais, Felixstowe, Newcastle and all the other places where we suspect, or know, that illegal immigrants are coming in?
With this area in particular, these orders should never be seen as a substitute for prosecution. Prosecution has to be explored with vigour. We are much better now at interdicting traffickers, but there is a view that we are still not as good as we would like to be and there is more to do. We are developing a UK action plan of human trafficking which will give us an end-to-end strategy to combat all forms of this evil crime. I was comforted that the noble Lord, Lord Dholakia, and the noble Baroness mentioned in particular those who are trafficked not for the sex trade but to be abused in employment. Illegal working operations can be as pernicious as any others. I was pleased to note that both noble Lords mentioned that, as did the noble Lord, Lord Hylton, who has raised the issue on a number of occasions.
The plan will include chapters on prevention, enforcement and victim support and we are aiming to publish it in the next month or two. The UK Human Trafficking Centre was established, as I think the noble Lord, Lord Dholakia, mentioned, in autumn last year, which supports the overarching aim of moving the United Kingdom to a leading position in relation to the prevention and investigation of trafficking of human beings. It will be the central point for the development of police expertise and operational co-ordination.
This morning, the Metropolitan Police launched a dedicated team to deal with human trafficking, as the noble Baroness indicated. As well as targeting the criminal networks, the key objectives of the team are to improve knowledge and understanding of trafficking; to give advice and support to other police units involved in investigating trafficking; and to work with partners and communities in seeking to improve the Metropolitan Police’s response to trafficking.
A specific team has been set up because of a real recognition of not only the pernicious nature of the offence but the need to do something aggressive in response to it. The team will work diligently with the Serious Organised Crime Agency and the other agencies seeking to interdict this crime. In order to identify who is doing it, a number of agencies often work together. Sometimes they follow the money, sometimes the people and sometimes the activity. I can assure noble Lords that that will continue.
As noble Lords have often heard me say, the United Kingdom is already compliant with the convention provisions on enforcement and the criminalisation of trafficking. But the main concern about the signature to the convention has been the potential impact on the provisions of a reflection and residence period for victims and the requirement to provide support, and specifically the risk that irregular migrants picked up during the course of illegal working operations will make false claims to victim status in order to frustrate removal.
At the moment, the United Kingdom operates a case-by-case approach to victims of trafficking, who are removable from the United Kingdom. We will pursue reparation of an individual only if it is considered appropriate to do so. The victims of trafficking who are accepted by the Home Office-funded Poppy Project, about which we have spoken on a number of occasions, will have removal action held in abeyance for about four weeks while they give consideration to whether they wish to remain and assist authorities. If they do remain, they are not removed by the Poppy system.
Much to the delight of many—I confess, including myself—we have been able to move forward on signing the convention. That is being dealt with as expeditiously as possible. As the noble Lord, Lord Hylton, will know, the modus operandi usually adopted by us, and indeed by other Governments before us, is to ready ourselves for signature so that ratification can take place as soon thereafter as reasonably practicable. I can certainly assure noble Lords that, my right honourable friend the Prime Minister having given the indication that we intend to sign and then ratify, everything is being done to expedite that and to make it possible to answer as soon as possible. I am aware that the noble Lord has, as he says, three Questions for Written Answer. As I understand it, the detailed work necessary to respond to him is being undertaken. We will give a full reply as soon as possible.
I understand why we have taken a circuitous route in this debate by which we have had a mini-debate on trafficking. But I say to the noble Lord, Lord Dholakia, that these prevention orders are not a substitute for prosecution; they are simply another way of preventing the continuance of an activity, particularly if we have identified those who have trafficked people before. We wish to interdict and prevent future trafficking. I am thinking not only of the victims whom we are able to release on that one occasion. Regrettably, as I indicated, there are those who engage almost continually in this practice, and we have to try to stop them. For the victims, prevention can be so much better than cure.
I listened with interest and gratitude to what the noble Baroness, Lady Anelay, said about her sympathy on these matters. I hope that I have said enough to assure the noble and learned Lord, Lord Lyell, that these matters are being vigorously looked at. The action plan, when it comes out, will cover prevention, what we are doing, what we are co-ordinating and how it will be delivered. We believe that there has been significant improvement in performance.
Can the noble Baroness clarify whether, for example, the physical structures and so on that assist in monitoring lorries at Calais have improved? Six years ago, the Government, in about their fourth year of power, took draconian action to remove rights and liberties, which has been thoroughly unsuccessful. They knew very well then that they would spend very little money on the kinds of technical assistance that would have been of real value. Now, in the 10th year of their administration, what has actually happened?
We have heat-seeking equipment, which I think has been available since early 2000, and sniffer dogs. I am happy to write to the noble and learned Lord. I did not expect that we would have a full debate on the details of trafficking, but I commend the noble Lord, Lord Dholakia, and his able assistant the noble Baroness, Lady Anelay, for enabling us to do so. I have to say that I am complicit, too, because I could have simply not replied.
The importance of this work is clear. I remind the Committee that we have put in place the procedure of obliging authorities to go to the High Court to obtain such an order to take into account the fact that the orders have to be proportionate and reasonable and to avoid the difficulty that arose on the previous occasion. We think that this is a good way of delivering on that. I am happy to write further on this to the noble and learned Lord, Lord Lyell.
Perhaps we can now move on to the next amendment. We have had a debate that has lasted 24 minutes.
I thank the Minister for her assurance that prosecution will be at the heart of this matter. Perhaps I may also point out that the noble Baroness, Lady Anelay, is not an assistant but very much a partner in this particular crime. I think that we have always spoken together on such issues in this House.
I am delighted to receive the Minister’s assurance. More importantly, we accept that there may be occasions when the lesser matter could be more appropriately linked. A clear message must go out from the Committee that such heinous crimes will not be tolerated and that people will be punished with the stiffest possible penalties. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
On Question, Whether Clause 1 shall stand part of the Bill?
Although my name is not down to the proposal that Clause 1 should not stand part of the Bill, my noble friend Lord Dholakia has suggested that I might be the person to speak to it. Before I begin, I should do two things. First, I declare an interest: I am the chair of the council of Justice, an organisation which submitted a briefing on the Second Reading of the Bill, although it has not as yet submitted a further brief on the Committee stage. Secondly, I speak on this occasion for myself and not on behalf of my party. It is an important distinction to make on this occasion because I shall be making certain suggestions which have arisen in my mind as a result of the meeting that the Minister arranged last night. I have therefore not had a chance to clear them properly with my noble friend.
I spoke on this part of the Bill on Second Reading. As I said then, and say again today, it is no answer to the problem that serious crime prevention orders will be made by judges who will act reasonably. We should not create laws that create scope for injustice and rely on the judiciary to apply those laws with moderation. I believe that Part 1 as it stands is incompatible with the rule of law and with the basic principles of our criminal justice system. However, I want to be constructive. I understand the objectives at which the Government are aiming and I want to see whether it is possible to suggest acceptable ways in which those objectives could be achieved.
I have no great problem in principle with imposing SCPOs on conviction for serious offences, provided that the SCPO is limited—I would want it to be limited in the Bill—to orders that are necessary and proportionate. An SCPO in those circumstances could be regarded as part of the sentence. It is the same principle as imposing a driving ban on a defendant charged with dangerous driving, in addition to a fine or prison sentence, and perhaps more directly similar to placing someone on a sex offenders register, with the effect that that has on the chance to obtain certain kinds of employment. I have more problems with imposing SCPOs after a conviction by a foreign court, but those problems could be overcome, and I do not think this is the time or place for considering how that might be done.
The real problem arises where there has been no conviction because imposing significant restrictions on the liberty of people who have not been convicted of any crime is not acceptable. This potentially goes far beyond the extent of the football ban. The only comparable circumstance is that of control orders under the terrorism legislation, for which there is a much stronger case because it is the aim of some terrorists to commit mass murder. This provision contravenes the basic principles of our legal system. We are facing a real and increasing danger of ASBO-creep; that is, the use of civil orders to evade jury trial and the need for proof beyond reasonable doubt.
Is there any alternative? There may be. The briefing the Minister arranged yesterday was very interesting. I think she has the Chatham House rule the wrong way round because it says that you can tell the world what was said at the meeting but not who said it. She has applied it the other way round. We know, therefore, that the director of SOCA was there, accompanied by one of his very senior colleagues. It became apparent that they were concerned in particular with the activities of people who assist organised crime without necessarily being parties to that crime. We have been given some examples of the way in which that might happen. The noble Lord, Lord Lucas, gave an example in relation to drug dealing. Another similar example, which I feel happy to give, as it was used as an example yesterday, is that the legislation would include, for instance, an owner who lets a property that a tenant uses as a greenhouse for growing cannabis, where the owner chooses not to go round to see what is happening there. These are all cases in which, under the existing law, there could be no prosecution because the individual was merely providing facilities, was not part of any actual criminal act and was not part of the conspiracy—no doubt having taken great care not to be so.
Facilitating criminal activity by providing goods or services or the use of property should itself be capable of becoming a criminal offence. There is a clear precedent for making such conduct an offence; that is, in connection with the law relating to money-laundering. One has only to look at Part 7 of the Proceeds of Crime Act 2002, one of the most powerful weapons against organised crime. It provides that if a defendant knows or suspects, or has grounds for knowing or suspecting, that money which he is handling is the proceeds of crime, he commits a criminal offence if he does not report it. That would need some modification but I do not think that would be very difficult. If the defendant provides goods, services or property to be used for the facilitation of a serious criminal offence, and if the defendant knows, suspects or has reasonable grounds for knowing or suspecting that the goods, services or property are to be used for that purpose, then that should be a crime—either if it is known when the person enters into the transaction or if he becomes aware of it at a later date and fails to notify the police.
That provision would be a great improvement on the present proposals because the creation of such an offence means that it would be criminal procedure which had to be used in order to obtain a conviction. It would mean imposing criminal penalties on a conviction which could include a serious crime prevention order. I believe it will have every bit as strong a deterrent effect on the facilitation of crime as the Bill now does, and it avoids the creeping threat to the rule of law from the use of civil procedure to impose criminal penalties.
I invite the Government to consider this alternative way of dealing with the issue. I recognise that it is impossible to rewrite Part 1 between now and Report, but it could be removed from the Bill and the Government could then either enact the rest of the Bill or, if they are able to move quickly enough, introduce a new Part 1 when the Bill gets to the House of Commons. Part 1, in its present form certainly, should not be allowed to remain in the Bill and should be dealt with appropriately on Report.
I want to clarify my understanding of what Part 1 achieves. It seems that we are all agreed that the first part of it is intended for those who have committed a serious crime and are now at liberty, for one reason or another. It will enable the court, without a great deal of trouble, to have their feet nailed to the floor so that they cannot carry on whatever activity the court thinks they are likely to participate in. Like the noble Lord, Lord Goodhart, I do not have a problem with that—subject to a few safeguards. My difficulty, particularly after the answer the Minister gave me a few moments ago, is with the effects on those who have facilitated crime because of the way the Bill is drafted. There could be an entirely innocent action but with devastating consequences.
The Bill is to be used to take out those facilitators who genuinely are criminal because they will not comply with anything and they will then be run down, which I do not particularly object to; but those who merely have their facilities used by criminals unwittingly will be turned into informers on the penalty of losing their business. That is going about things in a very heavy-handed fashion. There is a strong threat if somebody comes to me and says, “We are entitled to take out one of these orders against you, unless you provide us with this information”. It compels businesses, in particular, but also, I imagine, individuals who are scraping a living on the fringes of the underworld to provide the police with all the information that they desire. As I understand it, that has not been our practice previously. The range of penalties under Clause 5 are extreme when applied to those sorts of people, although I can see that they are appropriate for the hardened criminal. I address my own Front Bench as much as anyone else in questioning whether this is really the right way to treat our citizens.
Before the noble Baroness responds to the noble Lord, Lord Goodhart, I remind her of the position of noble Lords on these Benches. As my noble friend and I made clear, we are sceptical about the prospects of success of serious crime prevention orders. As the Minister made clear, and as my noble friend made clear at Second Reading, we believe that the real answer in the end has to be successful prosecution and that that ought to be pursued. Having said that, like the noble Lord, Lord Goodhart, we understand what the Government want to achieve. Certainly, at this stage we are not prepared to strike out the whole of Part 1 or even Clauses 1 to 5 and Schedules 1 and 2. We shall want to look very carefully at what the noble Baroness is about to say, particularly in response to our second amendment where we debated, to some extent, the general principle behind Clause 1.
Before we make any final decision, we will want to look at the Government’s response to further amendments that we have tabled to the rest of Part 1 and to Schedules 1 and 2. My noble friend has tabled amendments to explore why some crimes are included in Schedule 1 and others are not. The noble Baroness may remember that we had some sport on that at Second Reading. I am still intrigued as to why it is even necessary to have Schedule 1 at all when one bears in mind that Clause 2(2)(b) makes it clear that the courts can decide to add anything else they want to Schedule 1. To that extent, Schedule 1 seems to be a waste of space. No doubt the noble Baroness will respond to that at the appropriate time. For the moment I remind her that we are sceptical about the prospects of success and we need convincing.
I thank the noble Lord, Lord Henley, for his helpful and supportive scepticism. I understand the anxiety that the noble Lord, Lord Goodhart, expressed. I thank him for accepting that these orders could have great benefit in relation to those who have been properly convicted of an offence. He puts his finger on a matter on which a number of noble Lords said they had great anxiety: those cases where there may not have been a conviction but where criminal activity is going on and an order is applied for. I almost tremble to say it but I think that we on this side may be in danger of becoming more like Liberals on this issue than the noble Lord, as we seek to prevent the unnecessary criminalisation of individuals but to stop the activity that is complained of.
I absolutely understand the anxiety of the noble Lord, Lord Lucas. He rightly says that it would be iniquitous if ordinary business people going about their legitimate business with no idea at all that they were being used by serious criminals in an inappropriate and iniquitous way should be dragged into the net. I agree with him in that regard. That is why we have cast the net relatively tightly. The majority of people who are apprised of the fact that their property or facilities are being abused in this way are greatly shocked and appalled that that is happening and do everything in their power to ensure that they are not used in that inappropriate way again. However, in some cases that is not the response. One has to accept that some people are perfectly content to engage trenchantly with criminals and facilitate their acts confident in the knowledge that, if they make sure that it cannot be said with any cogency that they have planned the activity or knew expressly of it, they will keep themselves free of punishment but have the advantage of the ill gotten gains or the increased money that they get for their goods. Those individuals are facilitating serious crime while seeking narrowly to remain within the confines of legitimate activity. We hope to use these orders to differentiate between those two categories of people.
In crafting the criminal offence the noble Lord used words such as “knowing” or “reasonable grounds for suspecting”. The latter phrase is a more interesting construct, but the noble Lord will remember that when we have discussed reasonable suspicion or reasonable grounds for believing in relation to criminal offences, we have had difficulty getting that across.
I appreciate the noble Lord’s wisdom, as we had much debate on those provisions.
In this instance we are trying to deal with the defendant or person who avoids placing themselves in a situation which could be construed as engaging in criminal activity. Such behaviour must be stopped. We believe that, by making a civil order, we do not criminalise these individuals but we stop them from engaging in activity that facilitates crime. Serious criminals who are repeat offenders are very adept at taking advantage of such people in order to facilitate their crime. I am sincerely grateful for the noble Lord’s suggestion. We considered carefully whether we could adopt it but came to the conclusion that the prevention orders were the most appropriate response because there was a balance between creating another criminal offence and targeting the behaviour which we wanted to arrest. We believe that these orders do just that. However, we are very conscious of the concern raised by the noble Lord, Lord Lucas. That is why we have crafted the measure in the way that we have.
We have had very full debate on all the clauses. We believe that Clause 1 supports the intelligence-led approach driving the work of the Serious Organised Crime Agency—and, more generally, other law enforcement agencies—which will be specific and tailored to the response to that intelligence.
On Clauses 2 and 3, we have discussed what constitutes involvement in serious crime, and we will shortly discuss in detail the necessity of maintaining the discretion of the court to treat an offence as if it were included in Schedule 1. I look forward to debating that matter with whichever of the noble Lord, Lord Henley, and the noble Baroness, Lady Anelay, is privileged with the burden of discharging that related duty.
We have outlined how Clauses 3 and 4 are affected, so my reiteration of why Part 1 should hold would not benefit from repetition unless noble Lords think that it would be helpful. To the noble Lord, Lord Goodhart, I would say that we will continue to look at this matter as we move through the Bill and maybe we can then persuade him that the second limb is as proportionate as the first; we have been able to persuade him of that. Hope springs eternal, so I will not hold my breath—just in case.
I would recommend the noble Baroness not to hold her breath, and I would certainly not believe that I am being less liberal than the Government are here. In practice, this is what would obviously happen: if the police thought that something suspicious was going on, the first thing that they would do is go round and talk to the people in the business concerned—who, if they were taken aback by that, would say, “I had no idea about this, we will of course stop it at once”. That would be the end of that, and there would be no prosecution or charges, or anything of that kind.
In their proposals, the Government are in fact taking what I would regard as an easy way out, instead of having to come up with proof to the criminal standard that the person facilitating the crime was in fact aware of, or deliberately closed his eyes to, what was happening. It would not be possible simply on some lower standard such as the balance of probabilities to issue an order that could be highly restrictive and could, as the noble Lord, Lord Lucas, suggested, have a serious adverse effect.
The Government ought to require orders to be imposed only on the basis of a criminal conviction, which it should be possible to obtain here. That would certainly have a serious deterrent effect on those who knew what they were risking. However, I will take the matter no further.
Clause 1 agreed to.
Clause 2 [Involvement in serious crime: England and Wales orders]:
11: Clause 2, page 2, line 23, after “has” insert “conducted himself in a way that was unreasonable in the circumstances and, by so doing, has”
The noble Lord said: When the Minister says—as she did in the previous debate—that this Government act on intelligence-led information, then we all reach for our guns and invade another country. I do not think that her claim to be more liberal in this Bill stands examination for one minute.
We need to go through the clauses that she has just referred to in some detail. Clause 1(1) says:
“The High Court in England and Wales may make an order if—
(a) it is satisfied that a person has been involved in serious crime”.
Clause 2(1)(a) defines what is meant by “involved in serious crime”. It is if a person,
“has committed a serious offence”,
and then, in Clause 2(1)(b),
“has facilitated the commission by another person of a serious offence”,
or, in Clause 2(1)(c),
“has conducted himself in a way that was likely to facilitate the commission by himself or another person of a serious offence”.
Clause 4(2) makes it perfectly clear that, when the court is,
“deciding … whether a person … facilitates the commission by another person”,
or, in subsection (3), has been conducting himself in such a way as is likely,
“to facilitate the commission by himself or another person of a serious offence”,
first, the burden is on the respondent to prove that what he has done is reasonable in all the circumstances and, secondly, the court must ignore his intentions or any other aspect of his mental state at the time. So he may be completely innocent; he may not appreciate for a moment that he is facilitating another person to commit a crime or is conducting himself in such a way as is likely to do that. He may have no concept of that at all. But unless the respondent can prove that he has acted reasonably, he is liable to a serious crime prevention order.
As we discussed earlier, that order can amount to a serious restriction on his liberty, the use of his assets, his travel or his relationships with other people—even though he does not appreciate for a moment that he is facilitating another person to commit a crime. When all the verbiage is taken away, that is the real structure of this Bill; an innocent person can be subjected to all these restraints unless he can prove that what he was doing was reasonable.
Amendment No. 11 and all the others in the group, which I will not number, are designed to, at the very least, reverse that burden of proof so that an innocent person cannot be made the subject of an order unless the prosecution—that is, the person bringing him before the court—can show that he has,
“conducted himself in a way that was unreasonable in the circumstances”.
In other words, instead of the respondent proving that he has acted reasonably, the prosecution must establish that he has been acting unreasonably.
It is not appropriate to place a burden on a defendant with an innocent mind to prove something in order to avoid the imposition of such a draconian order. The law should punish only unreasonable actions; it should be for the state to bear the burden of establishing that a person’s actions are unreasonable. The force behind the submission that my noble friend Lord Goodhart made in the previous debate is that he requires the prosecution to prove a criminal offence to the criminal standard. That is what is liberal about his proposal and what is illiberal about the Government’s proposals in the Bill. The amendments would require the state to show that the actions of the defendant were “unreasonable in the circumstances”; only then would it be reasonable for the defendant to be subject to a serious crime prevention order because of those actions. I beg to move.
I can be brief on this amendment, but that does not mean that I have no sympathy with it—quite the reverse. I am grateful to Liberty for its briefing, which focuses on the reverse burden of proof. In moving the amendment, the noble Lord, Lord Thomas of Gresford, referred to the innocence of mind and the lack of intent of the person who is potentially subject to the order. We turn to the matter of intent in the next group of amendments and I shall not encroach on that now.
It is right to ask the Minister why it is appropriate in this case to impose the burden of proof on the defendant or, as the Government would say in this case, the “respondent”, as the civil procedure would be followed. She will know from previous debates on other Bills that we on these Benches wish to avoid the reverse burden of proof wherever possible—it even led me to being in the invidious position of being unable to support my noble friend Lady Miller of Hendon in her efforts to ensure that people on the streets could not wear veils in certain circumstances, simply because she was seeking a reverse burden of proof, which made matters so sensitive.
The noble Lord, Lord Thomas of Gresford, is right to target this issue, because at the moment I do not see any justification for applying the reverse burden of proof in this case.
I resist these amendments and I have already explored some of the reasons why. Amendment No. 11 and the other amendments in this grouping would change each reference in the Bill to “facilitation” or “conduct that was likely to facilitate” to include a reference to unreasonableness on the part of the proposed subject at the time of the behaviour.
I agree completely with the sentiment that if the proposed subject of the order has acted reasonably—to come back to the point made by the noble Lord, Lord Lucas—but none the less his actions have facilitated serious crime, or he has behaved in a way that was likely to facilitate serious crime, he should not be made subject to an order. There is no dispute between us on that. The Bill already provides for precisely this. Clause 4(2)(a) and 4(3)(a) state that any act that the proposed subject of an order can show was reasonable in the circumstances must be ignored by the court and so cannot form the basis for an order. These amendments would shift the burden of proving reasonableness from the proposed subject of the order to the applicant for the order. We believe that it is appropriate for the burden to fall to the proposed subject, because the particular reasons for his actions are likely to be within his particular knowledge.
Amendments Nos. 41 and 44 are consequential, as they would remove the existing reference to reasonableness in Clause 4. As a result, it would not be appropriate to accept them. However, I remind noble Lords that in civil proceedings it remains the case that he who asserts must prove; the applicant for these orders at the end of the case will have to have demonstrated to the court’s satisfaction, taking into account the two limbs that we explored earlier and the nature of the judgment in McCann, that they have discharged that responsibility. That puts a heavy burden on the applicant to satisfy a court and we think that it must be right that the people who will have the particular knowledge of the reasons why they did or did not do what it was alleged they did or did not do should be the ones to tell the court about it, as opposed to the applicant for the order. That is a reasonable and practicable approach. Therefore, I invite the noble Lord to withdraw his amendment.
The noble Baroness will recall that earlier this afternoon she told us in no uncertain terms that the burden of disproving in Clause 1(1)(b) was on the respondent and that it was not for the applicant for the order to require proof under Clause 1(1)(b).
I hope that nothing I said earlier was inconsistent with what I have just said. I have tried to explain that the applicant will have to prove it; the respondent will have to produce information about the reasonable excuse, as I have described. That is what I was talking about earlier; perhaps it is difficult when one takes some of these issues out of context, but that is when it happens. The assertion is made and the individual then says, “I have a reasonable excuse”, and has to produce information on what that is. However, at the end of the day, the applicant who seeks the order will have to satisfy the court on the balance of probabilities that the elements have been satisfied to justify the order. The noble Lord will be familiar with the process, having been in courts even longer than I have.
Far too much longer, I am afraid. With the greatest of respect to the Minister, I say that she has shifted her ground. Earlier today, she was undoubtedly saying that the burden of disproving in Clause 1(1)(b) rested on the respondent. Now she is saying that there is an evidential burden on the respondent to raise the issue and that Clause 1(1)(b) means that it remains for the applicant to disprove the issue, once it has been raised. She knows from the number of years that she has practised in the courts that there is a distinct difference between the evidential burden and the primary burden that the prosecution or, in this case, the applicant always carries. She has shifted her ground and I am pleased to hear it, because she will recall that I suggested earlier that if the burden rested on the respondent to disprove under Clause 1(1)(b), that would be an even greater breach of the European Convention on Human Rights than I had appreciated. However, even though she has shifted her ground, what remains is not at all satisfactory. For the moment I shall withdraw the amendment, but I shall certainly come back to it. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
12: Clause 2 , page 2, line 25, leave out paragraph (c)
The noble Baroness said: In moving the amendment, I shall speak also to the other amendments in the group. Their purpose is to challenge the Government’s definition of involvement in serious crime, as set out in Clause 2. I shall seek to be briefer than I would otherwise have been, given the debates on some of the issues regarding intent that have already taken place, not only in the previous group of amendments, but earlier this afternoon. It would be helpful to have a discrete answer from the Minister on the issue of intent, particularly because of the warning, or advanced notice, that we have had from the noble Lord, Lord Thomas of Gresford, that he feels strongly about the previous group of amendments and may take radical action on Report.
My amendments would restrict the use of serious crime prevention orders to situations in which a person had either committed a serious offence or facilitated the commission of such an offence. Clause 2 differentiates between “involved” in serious crime and “involvement”. The distinction is drawn because the first part of the test in Clause 1(1)(a) is concerned with the person who is “involved” in serious crime in England and Wales or elsewhere, whereas the second part of the test in Clause 1(1)(b), to which the noble Lord, Lord Thomas of Gresford, referred, is concerned with future involvement in serious crime in England and Wales only.
Our amendments ask whether involvement in serious crime requires a degree of intent on the part of the person being made subject to an order. My noble friend Lord Lucas said he was not concerned about whether the person had committed a serious crime and he had assumed from our discussions that those involved indeed had done so. The clauses show us that an order can be imposed upon somebody who has never committed a serious offence and never facilitated the commission of a serious offence by somebody else but who is judged somehow to have behaved in such a way that it was likely to make it easier for somebody else to commit a serious offence even if that serious offence were never subsequently committed.
That vagueness in Clause 2 seems objectionable at first sight and it would be useful to have a settled answer from the Minister today on that. There is no requirement that a person must intentionally participate in criminal activity so in theory innocent people could have an order imposed upon them. The Minister has said that will not happen. It is not that it cannot happen necessarily, but it will not happen. We will not catch businesses which are acting in an innocent way; we are looking at those that have as a matter of practice either looked the other way—so there is an intent in that they have ignored what is going on and therefore they are not caring about public safety—or they have already been warned by the law enforcement agencies about their activity: “This is the kind of criminal activity we know is going on. We believe it is linked with the way in which you run your business, for example because you have created false compartments for what you consider to be innocent purposes but they are being misused. We know this is happening. Stop it or change your behaviour and do something else”. If the person ignores all that and carries on, in a sense there is intent.
It might sound very reasonable to say that these people have been given the opportunity to amend their behaviour, therefore why not now do something else to stop them? But is it reasonable to make them subject to an order, given all the issues raised in Clause 4, or is there another way to address their behaviour?
Other noble Lords have felt constrained by not being able to give examples of behaviour because they listened to the briefing last night. I was not there but I still feel constrained because I have seen a note of the briefing so I am going to be very careful which examples I use as well. A high-street computer retailer could sell a computer to a person who uses it to run a human trafficking syndicate. An order could presumably be imposed upon a person who runs a shop selling fishing tackle because that tackle could be used to poach salmon illegally and that is treated as a serious crime in Schedule 1.
The Minister will say that the person has still been behaving in such a way that there is some kind of complicity. The fact that somebody is acting innocently but might find themselves within the remit of an order was recognised by the Home Office in the consultation that preceded the publication of this Bill. The Home Office gave an example of a situation in which a serious crime prevention order might be imposed. They gave the example of a company that makes the concealed compartments to which I have already referred, purportedly to allow drivers to hide their valuables when they are on long journeys so that they can secure them when they leave the cab, but of course these compartments could be used to store drugs. That is on page 10 of the consultation paper. The consultation paper points out that making the compartments is not in itself illegal—of course not—but it goes on to say that the order could impose a requirement on the business to notify law enforcement officers of the details of all such compartments and its customers. So despite the reassurances of the noble Baroness that people who have been taking proper measures will not be made subject to an order, an example is given in the consultation paper where somebody who is not complicit, who has not looked the other way and who has not turned down opportunities by the police to amend their behaviour, could still be made subject to an order. That is the direct implication of what the consultation paper says, which is why there has been concern outwith and within this House.
A further concern is about what is proportionate in the way one treats businesses—my noble friend Lord Lucas rightly brought that to our attention. The Minister said that there will not be criminalisation. Others have said that if an order was made, at least there would be publicity and that could have an adverse effect on the business. The consultation paper specifically says that an alternative might be that part of the order might provide that the business should notify law enforcement officers of the details of their customers and all the compartments. That requires the provision of a lot of bureaucratic work by the company which seems to be a substitute for industry regulation and one wonders why the Government have decided against industry regulation—with a light touch, I hope, because we on these Benches are not in favour of undue and unfair regulation on business—in favour of the panoply of orders that are before us. I beg to move.
I shall be very brief because many of the arguments on this matter have already been advanced. All I want to say at this stage is that I can see no circumstances where a person who has no idea that he is being used in this way should be subject to such an order. I find it fascinating that in the example that the Home Office knows and that the noble Baroness, Lady Anelay, mentioned about fishing tackle there is no culpability at all and yet with the example the noble Lord, Lord Lucas, mentioned about the compartments, somebody could be subject to that order. I find this anomaly very difficult to accept. I wonder whether the Minister could explain the thinking behind these two different circumstances.
We have covered a lot of this before so I shall not try to add too much. It seems to me that where we have people subject to these sorts of order, or potentially subject, if I read the Bill right they will have an effective defence by saying they agree to provide this information. The court will then presumably assess their reliability and if the court thinks they are likely to continue to provide that information correctly and efficiently, they would not grant the order. That is my understanding of it. We do not need to establish rights for ordinary businessmen as a separate defence as that seems to be already in there. I would be grateful for the Government’s confirmation that that is the case.
As my noble friend says, we have got to the point where there is a great extension of the procedures which are already in place with regard to television. When my son bought a television from an ordinary retailer, a week later he received a letter from the television licensing agency saying, “We see you have bought a television. Where is your licence?” So there is clearly—and I had not realised this—a procedure for reporting all sales of television equipment to some authority which then matches it against the database and chases it up. As a result of this legislation we are presumably going to have a series of similar arrangements with materials which are commonly used to commit crimes. Perhaps they are already in place. Perhaps if I go and buy myself a couple of daylight bulbs to offset seasonal affective disorder, I will find that the police know and start coming and looking through my windows to see what I am growing under them.
As my noble friend said, this is becoming a mechanism for producing a regulation whereby, whatever transaction details the Government want, they will have the right to get. However, rather than doing this by regulation so that it is applied evenly in a way that everyone knows, it will be applied by what comes down to an implied threat on an individual basis that says, “If you don’t do this, we will destroy your business”. Again, I question whether this is the right way to treat honest citizens.
It seems to me that our friend with the van with a double floor may turn out to be rather a bad example, and we should not be stuck on bad examples. If someone wants to make vans with a double floor, then, unless someone can prove that they are being used for illegal purposes, he must be allowed to continue to make them. To fit in with what my noble friend Lord Lucas said originally, it cannot be right to stop him doing that, and it would be wrong to say, “You’ve got to report all your customers”. Making vans with double floors might be his business. I can think of lots of uses for such vans. Farmers would like those vehicles—I can think of nothing more useful on a farm. So we must be careful with these examples. I know that the noble Baroness is a little hesitant to use them because they are rather vague as a way of describing what the Government are trying to do, but I am perfectly willing to accept that that is a bad example.
I shall respond, first, to the whole issue of industry regulation and shall take the example given by the noble Baroness, Lady Carnegy of Lour. It would be over-burdensome to say that all purveyors of such vehicles, who may have legitimate purposes, should give information to the authorities when asked. Indeed, I think that these vehicles are sometimes used by jewellers to convey articles from one place to another, which is a legitimate purpose. If you regulated the whole industry, you would put a huge burden on the 99 per cent of businesses that behave entirely appropriately. That would be unfair, unjust and over-burdensome. This provision seeks to target individual businesses which have failed and/or refused to participate in an appropriate way—thankfully, they are still a relatively small minority— and where there is cogent evidence from the authorities that their facilities are being used by serious criminals in a way that inures to the disadvantage of the community and the safety of all. So we think that targeting will make the approach more proportionate.
I have already said that it is our view that someone who has a reasonable excuse will not be in danger. It is a two-staged process. First, the agencies that will operate the orders and will be entitled to apply for them have to deal with a very targeted group engaging in serious criminal activity whom we are seeking to interdict. Therefore, there is always an issue of capacity and of targeting that which is likely to reduce the crime most effectively; in other words, you have to target the relevant people.
Thus, the first test will be the agency identifying those to whom the order should apply. The next test will be undertaken by the legal team which will represent them in relation to these orders, and it will ensure that it is satisfied that an application is more likely than not to succeed. The third test will then be carried out, which, in effect, will be the judgment by the court. We hope that if someone has a reasonable excuse for their activity, they will share it with the authority investigating that activity. If they fail and/or refuse to share it at that stage, they will then share it with the court, which will be in a position to make a decision about reasonableness. If the court finds that the excuse is reasonable, no order can be made.
For the sake of clarity, for which the noble Baroness, Lady Anelay of St Johns, asked, I shall deal with Amendment No. 12. This amendment relates to the meaning of having been involved in serious crime in England and Wales. The same arguments will apply to each of the other amendments, which relate to the other definitions of “involved in” or “involvement in” serious crime in England, Wales and Northern Ireland and outside England, Wales and Northern Ireland.
Clause 2 sets out what constitutes having been involved in serious crime in England and Wales. A person has been involved in serious crime in England and Wales if, first, he has committed a serious offence in England and Wales; secondly, he has facilitated the commission by another person of a serious offence in England and Wales; or, thirdly, he has conducted himself in a way likely to facilitate the commission by himself or another person of a serious offence in England and Wales.
It is right to suppose that the majority of the applications will come under the first two provisions, but Amendment No. 12 would remove the third element. As I said, most of the situations in which we see these orders being useful will be those covered by the first two but we believe that there are instances where the third will be appropriate and useful.
The majority of instances that we can foresee will relate to either organisations or individuals providing a good or service. That will usually be in a business context but occasionally it might be where someone provides a good or service on an informal basis. The sort of behaviour that we are talking about here is where a person or organisation turns a blind eye to the likely outcome of their actions—something to which the noble Baroness, Lady Anelay, referred. They may not specifically intend to facilitate serious crime, but they are not taking the precautions that we would expect reasonable people to take to ensure that their actions cannot facilitate serious crime, and so their actions help to bring real harm to others.
I emphasise that the applicant authority would have to show that the behaviour was “likely” to facilitate serious crime, but we do not believe that that is an easy test to meet. We think that the authorities would have to have cogent evidence to satisfy the court that they fell within this criterion. I believe that the test set out in McCann would apply to these provisions. The court would have to be satisfied that the condition was met, and that would mean that the probable outcome of their actions would have to be the facilitation of serious crime. The vast majority of people are able to apprehend the risk of something being the result of their actions where it is probable. This, combined with the exclusion contained in Clause 4(3)(a), under which any action which is reasonable cannot be the basis for an order, provides strong safeguards to those who might inadvertently facilitate serious crime.
Finally, when considering which conditions of an order will be proportionate, the court will consider the actions that form the basis of the order. The conditions necessary to prevent future involvement in serious crime are likely to be more light-touch for a person who has facilitated a serious offence, compared with a person who has committed a serious offence. For those reasons, the amendments tabled are unhelpful and unlikely to prevent the harm caused by serious crime, and so we must resist them.
I hope that I have been able to better and more adequately explain how the provision will work. On that basis, I hope that the noble Lord, Lord Dholakia, will be content to withdraw—no, the noble Baroness, Lady Anelay. The two are so interchangeable that I have made this terrible slip, and I beg both the noble Lord, Lord Dholakia, and, most keenly, the noble Baroness’s pardon for having so confused them.
My noble friend Lord Lucas rightly referred to the fact that in Clause 4 there is a defence of reasonableness from the point of view of the innocent trader. My concern always is when an innocent person has to avail himself of a reverse burden of proof. We have already had a debate on that in another context.
The Minister has assisted me by further clarifying intent. She said in particular that the majority of applications are likely to be under Clause 2(1)(a) and (b), but maintains that there could be occasions when paragraph (c) would be appropriate. I will certainly read very carefully what she has said with regard to that. She went on to say that she anticipated that cogent evidence would be required that a business was being used for criminal purposes. We have talked too much about adapted lorries today, but I recall that not so long ago the police successfully brought such a prosecution. That makes me think again that there might still be arguments against the need for crime prevention orders on those specific occasions.
The Minister might have unintentionally assisted the noble Lord, Lord Dholakia, who is on my right, at least on this occasion, in his quest to abandon Part 1. He does not have me on his bandwagon at the moment regarding that, but we will see what happens in the future. The noble Baroness has done the Committee a service by clarifying those issues, particularly regarding timing as I can indicate that as a result of her explanation I will not move my amendment on recklessness after what I anticipate will be the diner break. On this occasion, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 13 not moved.]
Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007
rose to move, That the draft order laid before the House on 8 February be approved. 10th Report from the Statutory Instruments Committee.
The noble Lord said: My Lords, your Lordships will be aware that the Companies Act 2006 had a long history, both in its policy development and its passage through this House. The Act is a large one and its implications are far-reaching, and it is important that we ensure its provisions are brought into force in an orderly fashion if we are to maximise the benefits to businesses.
In the context of the present debate, it might be useful to say something about our overall approach to the commencement of the Act. The Minister for Industry and the Regions, my right honourable friend Margaret Hodge, made a Written Statement in the other place on 28 February setting out, in comprehensive terms, the commencement timetable.
On the same day, the Department of Trade and Industry published a consultation document providing further information concerning implementation, the issues involved and the proposed way forward. We hope that all stakeholders will wish to engage with us to help us make the implementation package as good as possible.
A first commencement order was made in December 2006, commencing important provisions, facilitating electronic communications by companies and implementing EU obligations.
The present instrument, the second commencement order, would come into force from 6 April this year, the common commencement date. It would commence further provisions that we felt it right to implement ahead of the main body of the Act.
The draft order would bring into force Part 28 of the Act concerning takeovers. Throughout the passage of the Companies Bill, the Government made clear their intention to bring the provisions of Part 28 on takeovers into force at an early stage following Royal Assent. These provisions place the regulatory activities of the Takeover Panel within a wholly statutory framework. They will replace regulations which took effect in May last year and implemented the European takeovers directive on an interim basis while the Bill completed its parliamentary passage.
Section 943 of the Act confers a rule-making power on the Takeover Panel. The rules on takeovers have long been laid down in the takeover code, which historically had no statutory basis. Yesterday, the code committee of the Takeover Panel adopted the necessary changes to the takeover code to reflect commencement of Part 28 of the Act. These will come into force on 6 April.
The Takeover Panel has made a significant contribution to the competitiveness of UK financial markets over the past four decades. We are convinced that it will continue to do so within the new legal regime that underpins its activities.
The draft order would also extend to Northern Ireland the availability of community interest companies—CICs. These are limited companies, with special additional features, created for the use of people who want to conduct a business or other activity for community benefit, and not purely for private advantage. CICs were introduced in Great Britain by the Companies (Audit, Investigations and Community Enterprise) Act 2004—the CAICE Act. There are now more than 700 incorporated CICs. It was always intended that CICs would be extended to Northern Ireland. The necessary secondary legislation was, however, never finalised. The Companies Act 2006 will introduce a single legislative regime for companies applying throughout the United Kingdom. The order seeks to apply to Northern Ireland both the relevant provisions of the CAICE Act relating to CICs and the supporting secondary legislation.
In making this instrument, we rely on powers in the Companies Act to make consequential amendments, transitional provisions and savings and to commence the provisions of the Act. The consequential amendments provision—Section 1294—is subject to affirmative procedure. We believe that we are making common-sense use of this power. The draft order repeals or revokes redundant legislation, such as the interim regulations giving effect to implementation of the takeovers directive. It also updates references in other legislation to provisions replaced by the Companies Act 2006.
The provisions of the Companies Act 2006 that this order would bring into force have been extensively debated during the passage of that Act. These provisions are self-contained and offer immediate benefits in terms of securing regulatory independence for the Takeover Panel and extending choice of corporate vehicles. We think that there is a good case to give early practical effect to the takeovers and Northern Ireland CICs’ provisions which the draft order is designed to do. I beg to move.
Moved, That the draft order laid before the House on 8 February be approved. 10th Report from the Statutory Instruments Committee.—(Lord Truscott.)
My Lords, I know that the whole House will be grateful to the Minister for his careful explanation of this technical but, nevertheless, important set of regulations. For those of us, including the noble Lord, Lord Razzall, and I, who slogged our way through 1,920 amendments on the Bill’s initial passage before later considering 1,020 Commons amendments, the mere mention of the Companies Act 2006 brings a certain tension to the atmosphere. To paraphrase Shakespeare, we shall certainly stand on tiptoe when this Bill is named.
I welcome the noble Lord, Lord Truscott, to his first outing on this subject. He will be aware that the Bill did for his predecessor, the noble Lord, Lord Sainsbury, but I trust that a similar fate does not await him.
As I said, this is a technical set of regulations, but there are underlying issues on which I believe the House would welcome clarification. First, there are some practical issues relating to the 2004 Companies Act and the application of the CIC regime to Northern Ireland. Secondly, there is some unfinished business from the 2006 Act relating to the implementation of the takeover directive. Thirdly, there is the future implementation of the 2006 Act.
As I was preparing for this debate, I was hoping to persuade the Minister to lift the curtain a fraction on the Government's overall plans for implementation, because there have been a number of different smoke signals. At that very moment, through my letterbox came the Written Statement by Margaret Hodge in another place and the associated consultation document. That did not so much lift the curtain as tear it down. We are grateful to the Government for that—as, I know, are a whole range of practitioners. The 2006 Act is complex stuff with far-reaching consequences, so it is important for those affected to have the maximum time to absorb its implications.
I hope that I will not be seen to be ungrateful if I raise a mini-whinge about the Statement. It consists of a helpful list of the dates on which the various parts of the Bill come into effect. Two parts appear to be missing from the list: Part 39, “Companies: minor amendments”—by the way, I am not sure that minor amendments is quite the right title because quite substantial powers are taken and given up by the Minister in that regard—and Part 40, “Company directors: foreign disqualification”. It is only when one goes to the consultation document and the table of commencement date that one can discover that Part 39 is due to come into effect in April 2007 and Part 40 in October 2008. So my minor whinge—and it is a mini-whinge—is that it would have been preferable if the Written Statement had in and of itself contained a comprehensive list of all parts of the Bill.
I now turn to Northern Ireland and the CIC regime. We are sympathetic to the attempts to encourage voluntary and charitable work. We accept that a conventional company structure does not always fit requirements. It was in that spirit that we welcomed in principle the new CIC regime when they debated the 2004 Bill, as it then was, but they raised concerns in Committee. Chief among those was the fact that yet another regulatory framework was to be created, with all its associated costs and expenses, for which there might be little demand. The CIC regime is not quite as simple as it might at first seem. Part 2 of the rather clumsily titled, Companies (Audit, Investigations and Community Enterprise) Act, does not just set up a CIC. There is to be a regulator under Clause 27 with a whole schedule, Schedule 3, with his duties. There is a CIC appeal officer in Clause 28 and he, too, has a schedule of duties associated with him. Finally, there is to be a CIC official property holder in Clause 29, also with a schedule of duties.
So we are giving this expensive party. How many people want to attend it? The Minister has just given us an up-to-date figure of about 700. In terms of the per capita or per company cost, that must be an extraordinarily expensive exercise. Do we really have to extend all that structure to Northern Ireland now? Would it not be better to wait to see the level of demand in England and Wales before going ahead? If we are to go ahead, will the Minister confirm that Northern Ireland will not have to have its own regulator, its own appeal officer and its own official property holder? If not, and Northern Ireland must have its own officials, surely it would be even more unwise to proceed now, because on a pro rata basis, given what has happened in England and Wales, it would seem unlikely that Northern Ireland will have more than about 20 CICs.
I fear that the Minister will not be moved by those arguments. I suspect that if I were to be able to sit on the Bench behind him and glance over his shoulder at the speaking notes prepared by his officials, they would say words to the effect of, “It is very important to do this now. Northern Ireland is part of the United Kingdom. The encouragement of voluntary effort in the Province is particularly important”, and so on. If that is the argument that he will be deploying to the House, I draw his attention to the Charities Acts 2006, in which Clause 34 and its associated Schedule 7 establish a regime for charitable incorporated organisations—CIOs. The truth is that CIOs are CICs by another name. The only significant difference is that one comes under the DTI—CICs—and the other under the Cabinet Office—CIOs.
I yield to no one in my desire to encourage and increase charitable and voluntary work, but we need at all times to have regard to the regulatory cost and burden that we are creating and whether they are proportionate to any return to be achieved. If the Minister is determined to press on with this part of the regulations, he owes the House an explanation of why we need these two parallel, overlapping structures; what he thinks the difference is between CICs and CIOs; and for which separate problems they provide a remedy.
I now turn to the implementation of the takeover directive and Part 28 of the Act. We had lengthy debates in Committee in March last year on the loss of self-regulatory flexibility hitherto enjoyed by the Takeover Panel, which, as the Minister said in his opening remarks, has been such an important part of the success of the City of London. We accepted that if we were to create a level pan-European playing field in financial services, which would be much to the City's advantage, that was a price that we were going to have to pay. Where we were unpersuaded was that once again, there was evidence of goldplating—the UK doing more than was required by the directive. Specifically, what has become Clause 9(5)(3) makes failure to comply with rules about the takeover code and bid documentation a criminal offence. We were very concerned about what that might do for the City's competitive position.
At that time, last March, we could find no other European country that had felt it necessary to criminalise such behaviour to comply with the directive. The noble and learned Lord the Attorney-General argued lengthily and fluently—but not, in my case, persuasively—that we had to have that sanction to comply with the directive. However, he could not name any other country in the EU that thought as he did. When pressed, his only argument was that it was early days to see how different countries interpreted the provisions.
It is no longer early days. The directive has now been in force for eight months. It would be interesting if the Minister could tell us how many other countries have felt it necessary to introduce a criminal sanction. Were we right or was his colleague the Attorney-General right?
Finally, I have a point concerning the drafting. Schedule 1 has three paragraphs concerned with takeovers—2, 3 and 4. Paragraph 4.(2) concerns written resolutions defined in terms of Section 381 of the Companies Act 1985. According to the Hodge Statement, in October this year, Part 13 of the 2006 Act, “Resolutions and meetings”, will come into force. Clause 288 in this part deals with written resolutions. It will be helpful if the Minister could confirm that that will require another set of regulations to amend Paragraph 4.(2) to update their definition.
I conclude by saying that we are pleased to see the Government proceeding with the implementation of the Companies Act 2006—a vital updating of our corporate law. We are especially pleased in the light of the Hodge Statement on which the Government are to be congratulated. Notwithstanding that, given that general welcome, I will be grateful for some further detail on the points that I have raised.
My Lords, like the noble Lord, Lord Hodgson, but unlike the Minister, who took office afterwards, I have “Company Law Bill 2006” written on my heart, rather like Mary did with Calais, but the Minister was either fortunate or unfortunate—he would say unfortunate—not to have the opportunity. Nevertheless, in the view of the noble Lord, Lord Hodgson, and myself, we ended up with a very good Bill as a result of the conduct of proceedings in both this House and the amendments that the Government took on board to what was, I think, the largest Bill ever presented to either House of Parliament.
As the noble Lord, Lord Hodgson, indicated, the Statement from Margaret Hodge, the relevant Minister in another place, indicated when the various pieces of legislation come into effect. My instinctive reaction has been to ask why some of them need to take so long. Industry and the professions have taken on board the Bill’s implications, but I am not entirely sure why it needs to take until 1 October 2008 to bring into effect many of the provisions. However, that is obviously what the Government have decided and that is what will happen.
I want to draw attention to a point about the regulations. I am more worried that the Minister in another place has indicated in her Statement that there will be a consultative document on the policy issues related to the secondary legislation that will need to be made under the Act and on transitional and savings provisions. I am concerned that we should not become bogged down in the detail; in particular, the corporate law files that seem to have applied particularly to Article 11(2) of the order. If that is the extent to which practitioners are expected to understand what the Government are saying, I draw attention to the Explanatory Memorandum on Article 11(2). The Minister is probably too young to remember the Hoffnung story about the bricks and the rope but the noble Lord, Lord Davies, sitting next to him, will remember it because he is older than I am. The Explanatory Memorandum states that:
“Article 11(2) relies on Section 1296(1) of the Companies Act 2006 to save the application to limited liability partnerships (“LLPs”) of a provision of the Companies Act 1985 which it had been intended should continue to apply to LLPs despite the repeal of that provision in its application to companies. Because of an error in the Companies … Order, this was not achieved. The Department considers that this saving is effective notwithstanding that the repeal has already come into force, because its effect is not to reverse the repeal but to save the application of the repealed provision to LLPs and thus to cause it to apply again from the coming into force of the Companies Act 2006 … Order 2007. The Department does not consider that savings under section 1296(1) have to be made at the same time as the commencement to which they relate.
“It has been suggested that the vires ought to be found within sections 15 to 17 of the Limited Partnerships Act 2000. They could not, however, have been relied upon in this commencement order, because the power there is to make regulations. There seems to be, in any event, no difference between what could have been achieved had separate regulations been made under section 15(b) of that Act and what has been provided in the Order under section 1296(1) of the Companies Act 2006”.
I know that the noble Lord, Lord Davies, is a man of distinguished ability, perspicacity and brilliance. If even he is prepared to stand up and explain what that gobbledegook means, I bow to him with the estimation that I always show him, but if this is the quality of consultation that will apply to future orders, I worry for the future of consultation.
My Lords, I am grateful to noble Lords for taking part in this debate. I would like to recall to your Lordships’ House the words of my noble friend Lord Sainsbury on 23 May last year in concluding the Third Reading debate on the Bill, which became in this House the Companies Act 2006:
“I believe the constructive spirit in which we have engaged in what have sometimes been controversial and often extremely technical issues has contributed greatly to the quality of debate. That is one key reason why the Bill leaves this House in such good shape. Ultimately, it is a Bill that will greatly help the success of British industry. However, all good things must come to an end”.—[Official Report, 23/5/06; col. 796.]
It was no doubt with relief that your Lordships completed the work on that Bill; they have all my sympathy. Great work was carried out in this House on that Bill. The present draft instrument, the second commencement order, is a further step towards that end.
Before responding to the points that noble Lords have made, I would like to pick up on a few of the themes from my noble friend Lord Sainsbury’s remarks that remain pertinent this evening. The first is the constructive spirit of the debate. I am grateful to noble Lords this evening for their contribution to the provisions now contained in the Act which the second commencement order would bring into force. I am convinced that the provisions are all the more robust for the detailed scrutiny that they received in this House.
Secondly, I turn to the technical nature of the provisions. I fear, alas, that companies legislation will always be beset by more than its fair share of complexity, as we heard again from the noble Lord, Lord Razzall. We are taking steps to make the legislation as accessible as possible. There are, for instance, briefing notes and explanatory guidance on the DTI website concerning the commencement orders laid to date and the takeover provisions introduced by the current order. Information about CICs is available on the website of the CICs regulator. I am sure that that will make the clause to which the noble Lord, Lord Razzall, referred, as clear as day.
Finally, I shall deal with the benefits to business. I shall not try to pretend that the content of this draft order is exciting in itself. It is a technical and complex instrument, but it brings into force important key provisions of the Companies Act 2006.
I shall deal with the points raised by noble Lords in the debate. The noble Lord, Lord Hodgson of Astley Abbotts, pointed out two minor blemishes in the Written Statement on the commencement timetable. I agree that it is important that business can plan properly for implementation of the Act. The Written Statement will greatly facilitate that. I can confirm that the extension of the CIC provisions of the CAICE Act will not lead to a parallel regulatory regime in Northern Ireland. Northern Irish CICs will use the same system as that in Great Britain. We expect roughly the same level of take-up as for Scotland and Wales, and the CIC regulator is absorbing the extra costs and therefore the regulatory costs should not be excessive.
On paragraph 4(2) of Schedule 1, there will be at least one more commencement order after this, and it will ensure that any transitional adaptations included in the draft order now before the House will cease to have effect at the appropriate time. The noble Lord, Lord Hodgson, also mentioned the takeover bid documentation offence. During the passage of the Bill we listened carefully to the arguments on the new takeover bid documentation offence. I wish to reassure the noble Lord about the impact of the new offence provision. Liability under the offence is incurred only where a person actively knew that the bid documentation did not meet the required standards or was reckless as to whether it did so and failed to take all reasonable steps to rectify the shortcoming. That seems to us a reasonable and proportionate test. We also introduced amendments designed to narrow and clarify the scope of the offence, but nevertheless continue to view the offence as an important part of our package to implement the EU takeovers directive. We are not aware of a comparable situation in other EU member states, but I will look into it further. If it is of interest to the noble Lord, I shall write to him on the matter.
The noble Lord, Lord Razzall, mentioned the implementation timetable. All of the Act will be in place by October 2008, with many elements implemented earlier. Major parts of the Act will be commenced in October 2007 and April 2008. The Government have been guided by a desire to see the benefits for business introduced as quickly as possible and to observe common commencement dates. We are aware, however, that business needs time to prepare properly for the implementation of such a large and important Act, as I said earlier when referring to the point raised by the noble Lord, Lord Hodgson. We have had extensive discussions with a wide range of interested parties to make sure that we have a timetable that gives business certainty, time to prepare and, wherever possible, early savings and administrative benefits.
The Government’s consultative document was published on 28 February. It sets out our proposed approach in areas where secondary legislation is necessary to implement the Companies Act 2006. It also considers the extent to which transitional provisions are needed to ensure that the Act operates in a reasonable way for existing companies. It deliberately seeks to focus the attention of consultees on areas where we are considering substantive change.
The noble Lord, Lord Razzall, expressed his views on the clarity of Article 11, on limited-liability partnerships.
My Lords, I am always grateful for the knowledgeable advice of my noble friend Lord Davies. Article 11(2) arises from the repeal of a provision in the 1985 Act, which repeal was brought into force by the first commencement order. The article provides that the repeal does not apply to limited-liability partnerships. This is not the reinstatement of a repeal but a saving. The repeal provision was applied to LLPs by the Limited Liability Partnerships (No. 2) Regulations 2002, which remain fully in force. Our intention is to include a saving provision in all the commencement orders so that the provisions of the Companies Act 1985 which have been applied to LLPs by regulations such as these remain in force for LLPs until such time as we are ready to replace them. In this case, the saving provision was omitted in error. The Joint Committee on Statutory Instruments has raised no objection to this provision. I hope that I have made the position on this absolutely clear and that there is now a full understanding of the clause.
That concludes my remarks—
My Lords, the point I sought to make was not on the substance of the article, which is summarised but that the language and explanatory documents on these commencement orders should not be presented in a Hoffnung manner. The noble Lords, Lord Davies and Lord Hodgson, and I are all old enough to remember Hoffnung. We need to use plain English in explaining these provisions. We may understand the points, but a lot of people out there will not.
My Lords, the noble Lord makes a fair point. The clearer and simpler the language can be in these documents, the better. I think that we would all appreciate the use of clear English that people outside this House may have an opportunity of understanding. I commend the order to the House.
On Question, Motion agreed to.
Serious Crime Bill [HL]
House again in Committee on Clause 2.
[Amendments Nos. 14 and 15 not moved.]
16: Clause 2 , page 2, line 33, leave out paragraph (b)
The noble Baroness said: In speaking to this amendment, I shall also speak to Amendments Nos. 25, 30 and 39, which are grouped with it.
The Government’s rhetoric surrounding the Bill has spoken of the new tough measures regarding people involved in serious crime, so it is important to examine whether these measures will indeed target what would be commonly thought of as serious crime, or whether it misses that target and adopts a scattergun approach across a wide range of offences that would not normally be considered serious. We have tabled a series of amendments to examine different aspects of that question. They fall into different groups, some of which I anticipate will be debated upon another occasion but not tonight.
The first group challenges the Government’s proposition that the definition of serious crime can be changed on a day-to-day, case-by-case basis by the courts. That seems extraordinary. There was some small reference to this earlier today, but these amendments address the detail of the matter.
Schedule 1 lists a range of criminal offences that are to be treated as serious crime. In a later group we shall examine whether that list is in itself appropriate, when we reach Amendment No. 49. What concerns us in this group of amendments is the fact that the Bill provides that a serious offence includes any that, in the particular circumstances of the case, the court considers to be sufficiently serious to be treated for the purposes of the application or matter as if it were so specified. So even if an offence is not listed in Schedule 1, a judge can treat it as if it were.
I join with the Minister in her remarks earlier today; I am on record too as having great faith in our judiciary. Of course I do. I have previously declared my interest, that I am married to a barrister who sits as a part-time recorder in the Crown Court. The Minister’s effusive remarks were on the calibre of the High Court judges and the way they were going to make these decisions, and I also, of course, admire those in the Crown Court.
Despite all that, however, I can set that partiality aside; it does not mean I am content with the proposition that there should be so little clarity and certainty in the law before us that we should leave it to the judge to determine case by case, on the matter of the moment, what should be construed as serious crime within the context of the applications for a serious crime prevention order. In theory, that means any offence could be construed as serious, such as graffiti or minor criminal damage to a neighbour’s fence. Despite what the Minister said when she responded to Amendment No. 2 earlier today about the ability of High Court judges to construe what is serious crime, the problem is that, however able they are, by giving them that power in the context of these orders, we simply lose clarity and certainty in the law. The Explanatory Notes are silent on the Government’s justification for such a wide-ranging discretion in the hands of the court.
The Government’s proposals do damage to the principle of legal certainty. We seek to remove that uncertainty. Our amendment would ensure that an offence was only a serious offence if it was actually listed in Schedule 1. I beg to move.
We wish to be associated with these amendments. We are also concerned that, as the noble Baroness, Lady Anelay, has pointed out, at present an offence can be a serious offence for the purposes of the Bill if the court considers the circumstances of the case to be sufficiently serious to be treated as such. These amendments would remove that provision, meaning that an offence was only a serious offence if listed in Schedule 1 of the Bill.
There has been a very worrying aspect of this clause. What is a serious offence, and what particular circumstances do the courts consider to be sufficiently serious to be treated as such? I mentioned that at Second Reading, and I said:
“In other words, the court can regard any offence that it likes as serious. That is an Alice in Wonderland definition; it is effectively saying that words can mean whatever the courts want them to mean”.—[Official Report, 7/2/07; col. 759.]
That does great damage to the principle of legal certainty, making it impossible for a person to ascertain in advance what are the likely legal consequences of their actions. The amendments would remove this provision, meaning that an offence had to be listed in Schedule 1 to be treated as a serious offence.