Criminal Justice (International; Co-operation) Bill [Lords]

HC Deb 27 February 1990 vol 168 cc148-81

Order for Second Reading read.

4.2 pm

The Secretary of State for the Home Department (Mr. David Waddington)

I beg to move, That the Bill be now read a Second time.

I venture to think that this is one of those occasions when there will be little disagreement in the House about the importance of a Bill. The small number of hon. Members present demonstrates not the lack of importance of the measure, but the lack of political controversy surrounding it.

The House needs no reminding of the menace posed to society by drug trafficking and other types of international crime, and the international community has to work against those whose trade is the misery of others.

The Bill is composed of two distinct but closely related parts. Each deals with international co-operation and each will enable the United Kingdom to ratify an important international convention. Each will demonstrate our willingness to co-operate with other countries in fighting international crime and provide us with the means to give assistance to other countries and receive assistance from them.

Part I is concerned with the generality of international crime and co-operation between this country and others over obtaining evidence for use in criminal proceedings.

We have made much progress in recent years in international co-operation on criminal justice. The passage of last year's Extradition Act brought our extradition laws fully up-to-date. When we ratify the European convention on extradition in the next few months, it will become simpler to return fugitives from justice to convention countries so that they can face trial in the countries which they fled.

It is also now possible for us to seize the assets of those who have deposited their ill-gotten gains in this country, having committed crimes abroad, thereby enforcing other countries' confiscation orders as a result of agreements made with them. Thirteen such agreements have been concluded—11 on drugs and two on serious crime generally—and more are in the pipeline.

Power to confiscate assets and power to extradite are not enough in themselves—we must also ensure that the evidence needed to secure a conviction can be brought before the courts, either in this country or overseas. Our law has remained unsatisfactory.

Mr. Dennis Skinner (Bolsover)

Will the Secretary of State explain our extradition arrangements with the United States, particularly in respect of the two people involved in the Peter Cameron-Webb scandal on the stock exchange more than five years ago? Peter Cameron-Webb and his mate got away with about £40 million. According to reports, neither of them—they are living in the lap of luxury in America—has even had his collar felt. We are now told that it is too late to extradite them to face justice in Britain. Will the Bill do anything to ensure that those two people are brought to justice for one of the biggest financial scandals in this country?

Mr. Waddington

This is not an extradition Bill. Last year, we passed an important Bill to bring our extradition laws up to date. It dealt with the circumstances appertaining at that time and with those that may arise following its enactment.

Britain is one of only a few countries in the Council of Europe that have not ratified the European convention on mutual assistance, which was drawn up as long ago as 1957. The historic reliance of our courts on oral evidence and the inadmissibility of written evidence obtained from overseas have been the principal reasons for that, not negligence, but following the changes to the laws of evidence made by the Police and Criminal Evidence Act 1984 and the Criminal Justice Act 1988, written evidence is now far more likely to be acceptable to a court, and the time has come for us to recognise the advantages of ratification and to follow the practices of others.

Dame Elaine Kellett-Bowman (Lancaster)

Will the Bill make it easier for us to extradite citizens of the Irish Republic?

Mr. Waddington

I explained that the Bill does not deal with extradition. In recent years, we have updated our criminal justice law, including our law on extradition.

Clauses 1 and 2 deal with the service of judicial documents such as summonses. Clause 1 creates a more effective means than is currently available by which summonses and other judicial documents issued by a court overseas can be served on a person in the United Kingdom. Clause 2 is a reciprocal provision making it possible for summonses to be served on people who are outside the United Kingdom, requiring them to appear as witnesses or defendants in criminal proceedings in this country.

Clauses 3 and 4 deal with the taking of evidence in one country for use in proceedings in another. Clause 3 makes it possible for courts and prosecuting authorities in this country to issue letters of request, seeking evidence from overseas which is needed in connection with an investigation or proceedings under way here. Clause 4 enables us to respond to such requests from overseas by having the evidence requested taken in a court in this country and then transmitted back to the country which made the request.

Mr. James Arbuthnot (Wanstead and Woodford)

Is my right hon. and learned Friend aware of the slight concern that clause 4 may override a privilege that was granted by section 144 of the Finance Act 1989? I recognise that that is a rather esoteric question and it is not one on which I seek an immediate response.

Mr. Waddington

That point will be dealt with by my right hon. Friend the Minister of State in his reply. I do not think that it affects the question of privilege. The court will apply the same rules in connection with privilege as it does now. My right hon. Friend will be able to develop that point in his summing up.

Clauses 5 and 6 concern the temporary transfer of prisoners from one country to another to give evidence or to assist with investigations. Clause 5 will enable us, with the consent of the individuals concerned, to transfer prisoners held in United Kingdom prisons to another country where they will be held in custody, brought to a court to give evidence and then transferred back to this country. By the same token we shall be able to receive on a temporary basis prisoners held abroad who are needed to give evidence in cases before courts here.

Clauses 7 and 8 enable the police in certain circumstances to seek a warrant from a magistrate authorising the use of powers of entry, search and seizure at the request of the authorities in another country to assist with an investigation or proceedings taking place there.

Mr. Tony Banks (Newham, North-West)

Will the Home Secretary vet such applications himself? Will there be political supervision of such requests so that the authorities in this country can be assured that the request coming from overseas legal authorities is satisfactory and that there is a case to be answered?

Mr. Waddington

That would not be a matter for the politicians—I sincerely hope not. If it were, I am sure that many hon. Members would complain. This is a matter for the courts of the land, whether magistrates or Crown courts. Judges will decide whether the application is properly brought under the law of this land and in accordance with the convention.

In drafting the provisions, we have been guided by the principle that no more powers should be available to be used by foreign courts and prosecuting authorities than would be available to our courts and prosecuting authorities in a purely domestic case. I am sure that that will give some reassurance to the hon. Member for Newham, North-West (Mr. Banks). It is a good example of the point that I am making. With this in mind, we have set out to replicate the domestic provisions contained in the Police and Criminal Evidence Act and in Scottish common law. Thus a foreign authority will be able to ask our police to enter premises to search for evidence relevant to an investigation only if the police could act in a similar way in a domestic case.

Clause 9 deals with the forfeiture of what are known as "instrumentalities" of crime—objects used in the commission of an offence. As I have already mentioned, we have strong laws governing the confiscation of the proceeds of serious crime and have agreements with several countries covering the enforcement of each other's confiscation orders. But one thing that we are currently unable to do is to enforce orders made by overseas courts for the forfeiture of items used in the commission of serious crimes, such as a getaway car used in a bank robbery or a boat used to smuggle drugs. The clause will remedy that weakness.

I am sure that the House will recognise that the proposals I have outlined are sensible and practical, and will enhance our ability to work with our international partners in the fight against all forms of international crime. Our ratification of the European convention on mutual assistance in criminal matters will he not only a positive demonstration of our commitment to work as closely as possible with our Council of Europe partners, but a guarantee that the other parties to the convention will assist us.

Part II contains provisions that are necessary to enable us to ratify the United Nations convention against illicit. traffic in narcotic drugs and psychotropic substances. The convention is known as the Vienna convention. It begins with a code of offences of illicit trafficking, and then provides mechanisms that enable states to co-operate with each other in bringing traffickers to justice, wherever they may be. It also provides for the tracing, freezing and confiscation of property derived from trafficking, which we already know to be a very powerful weapon. The convention also provides a framework of practical measures to assist the law enforcement agencies to detect traffickers. Clauses 12 and 13, together with schedule 3, for example, are designed to prevent the diversion to illicit use of a range of chemicals that are essential in the production of controlled drugs.

Mr. Chris Butler (Warrington, South)

Why does clause 12 create the offence of manufacturing or supplying certain substances that are scheduled, rather than simply making it an offence knowingly to manufacture substances that may be used in the illicit manufacture of controlled drugs?

Mr. Waddington

It is very much more satisfactory to list those substances that we know are used in the manufacture of controlled drugs and then include an order-making power in the Bill. The Bill could hardly cover substances that do not exist. It would be very difficult to frame a clause specifying that any substances that might subsequently turn out to be ones that could be used in the manufacture of drugs should be covered by the Bill. That is why, if my hon. Friend turns to clause 12(5), he will find that the schedule may be amended by Order in Council. I think that that is a satisfactory way of dealing with the matter.

In the United Kingdom, since 1971, we have operated a voluntary system of control whereby the companies that manufacture and supply these chemicals have been encouraged to draw to the attention of the police and the Home Office drugs inspectorate details of any suspicious orders and transactions.

That system has worked well, with admirable co-operation from the chemicals industry, and this has led to the identification of many clandestine laboratories, both in the United Kingdom and overseas. We do not see the need to switch to a mandatory reporting system on American lines. What the Bill will do, therefore, is put the current voluntary system on a statutory basis, in that it will require records of transactions to be kept and will empower enforcement officers to enter premises and demand the production of records.

Clause 14 is intended to enable us to meet the terms of article 3 of the Vienna convention. This requires parties to the convention to make it an offence to conceal or disguise property, or to convert or transfer it, knowing or suspecting it to be the proceeds of drug trafficking, and for the purpose of helping someone to avoid being prosecuted for a drug-trafficking offence. We already, of course, have a money-laundering offence in section 24 of the Drug Trafficking Offences Act 1986, but the new offence will catch the drug trafficker laundering his own proceeds, whereas the provision in the 1986 Act is about laundering the proceeds of someone else's trafficking.

Mr. Ivan Lawrence (Burton)

I apologise to my right hon. and learned Friend for interrupting him, but I should like to know whether the reason for including this clause is that some drug companies have not co-operated with the Government by supplying voluntarily the information whose provision we are now making compulsory.

Mr. Waddington

A very good voluntary system operates. That is why we do not consider it necessary, in this Bill, to go through the paraphernalia of requiring notification of dealings in any of these drugs. Therefore, in the Bill we are merely providing for what goes on at present. Companies keep records of these goods and can keep authorities informed of any transactions that they believe are in any way suspicious. There is no question of our putting in the Bill anything that is unnecessary. We are including the minimum that is required to conform with the convention.

Clauses 15 and 16 will enable us to meet fully the requirement of the convention that we should ensure that the maximum possible amount of the proceeds of drug trafficking—and any income derived from them—is confiscated. To do this, we need to make two adjustments to the confiscation scheme established under the Drug Trafficking Offences Act 1986. The first is to make it possible to add interest to the amount that remains unpaid at the end of whatever time a court allows for payment when it makes an order for the confiscation of the proceeds of drug trafficking. Clause 15 achieves that. The second thing that we must do is to make it possible to increase the amount that can be recovered under a confiscation order if it turns out that the amount that might be realised is greater than was initially assessed by the Crown court. That will be achieved by clause 16.

The Vienna convention also requires parties "to co-operate" to the fullest extent possible to suppress illicit drug trafficking by sea and each party is required to establish jurisdiction over offences of illicit trafficking on its own registered vessels.

Clause 17 extends to British ships all drug trafficking offences—all those existing before the Bill comes into force as well as those that we are creating—and clause 18 creates——

Dr. Norman A. Godman (Greenock and Port Glasgow)

May I ask the right hon. and learned Gentleman a question in relation to clauses 17 and 18? By "British ships" does he mean United Kingdom-registered merchant vessels, United Kingdom-registered fishing vessels and pleasure craft owned by United Kingdom nationals? What is meant by an unregistered ship?

Mr. Waddington

The hon. Gentleman is entirely right in his assumption. Clearly the Bill covers all United Kingdom ships—all those that are registered as United Kingdom ships and all those that fly the British flag. But the Bill must also cover circumstances in which, negligently or for a criminal purpose, someone has failed to register his ship with any nation. There would be a gap in the Bill if provision were not made to deal with that eventuality.

Dr. Godman

But what happens to a British-owned vessel that flies a flag of convenience?

Mr. Waddington

I think that in those circumstances, the ship would be treated as a ship registered with that other country. The convention would be apt to give us the power, with the consent of the other country, to board that ship. It would also give us extraterritorial jurisdiction to bring to trial anyone on board that ship against whom there was evidence of a drug offence.

Clause 18 creates a new offence in respect of the transportation of illicit drugs which will apply to the ships of convention countries and to unregistered ships, as well as to those registered here. Clause 18(2) provides that the offence is committed if a person knows, or has reasonable grounds to suspect, that the drugs are intended to be imported, or have been exported, contrary either to section 3(1) of the Misuse of Drugs Act 1971 or to the law of any other state.

Clause 19 and schedule 3 create arrangements whereby the United Kingdom may authorise other countries to board our ships and we may be authorised to board other ships. We in the United Kingdom do not require any authorisation to board an unregistered ship, but the Bill makes it clear that in the case of ships registered in convention states boarding may take place only at the request, or on the authorisation, of that country. Subsection (4) empowers the Secretary of State to seek such authorisation or authorise the boarding of United Kingdom vessels by other convention states. But in giving his authority the Secretary of State will be able to attach conditions. For example, he might wish to limit local prosecution of any offences discovered to ensure that they are offences broadly covered by United Kingdom law or to ensure that punishments seriously out of step with those allowed by our laws are not imposed.

Clause 21 deals with extradition and makes a number of adjustments to our laws to ensure that we are fully able to meet the requirements of the Vienna convention.

Clause 22 applies to offences created by the Bill certain provisions of the Misuse of Drugs Act 1971 in relation to existing drugs offences. For example, it extends the powers of enforcement officers in relation to searching and obtaining evidence in respect of controlled drugs to cover the chemical substances in schedule 2.

No one can doubt that the United Kingdom—indeed the whole international community—faces a terrifying prospect unless we can prevent the drug problem from escalating further. In my recent visit to the United States I saw at first hand the misery that has been wrought by drugs. The most powerful memory that I brought back with me was of a class of five-year-olds having the "say no to drugs" message drummed into them, lest even as young children they should be targeted by and fall victim to the drug pushers. In the four days I was in the United States two law enforcement officers were murdered. One murder was clearly committed because the victim was carrying out a major investigation into the activities of a drugs cartel. The other died serving a search warrant on someone not directly involved in drugs-related crime but high on drugs at the time. In the past year in Colombia, we have seen how the drug cartels have felt sufficiently sure of themselves to wage war against a democratically elected Government. President Barco's courageous stand has won universal admiration. We must make sure that he is given all the assistance that he needs to defeat these evil men who corrupt our children and the very fabric of our society.

There is no simple solution to this problem. That message came across clearly in the debates at last week's special session of the United Nations General Assembly, which adopted a comprehensive global plan of action. But any plan depends on the level of commitment given to making it succeed. In the few months since I became Home Secretary it has become clear to me that one of our top priorities must be to reduce the demand for illicit drugs, for without a market the drug barons would soon be out of business. That is why we set up the new drug prevention initiative which will muster the forces of the communities most at risk. But we must also continue to be vigilant and energetic in reducing illicit supply.

As the House knows, the world ministerial drugs summit, which we are organising in association with the United Nations, is due to take place in London between 9 and 11 April. Particular attention will be given to how to strengthen the effectiveness of demand reduction policies. We will also examine ways of reducing supplies of cocaine—which are reaching western countries in ever-increasing quantities. We are determined that the conference should have a tangible outcome, and complement the recent discussions in New York and last month at Cartagena when President Bush met the Presidents of Bolivia, Colombia and Peru.

The need for concerted international action is also reflected in the report on drug trafficking and related serious crime prepared last November by the Home Affairs Select Committee. This is an excellent document and we shall respond shortly to its recommendations. In the meantime I reiterate my thanks to my hon. Friend the Member for Westminster, North (Sir J. Wheeler) and his colleagues for their painstaking work.

But the Bill is not just about drugs. It is. about enhancing our ability to tackle international crime generally by allowing us to work more closely with our international partners. The two conventions that the Bill will permit us to ratify are useful and important instruments and I know that our ratification will be very welcome in the international community which has long looked to Britain to take a lead in the fight against crime and has not looked in vain.

4.29 pm

Mr. Barry Sheerman (Huddersfield)

It almost goes without saying that Opposition Members give the Bill our full support, following not only our commitment to it but the statement made by my right hon. Friend the Leader of the Opposition when the Bill was first announced. Any measures which are carefully devised and thought through, and which tackle international crime in general and the murderous trade of drug trafficking in particular, will be wholeheartedly supported by the Opposition. That applies to this Bill, which is not controversial. I shall therefore also try to be reasonably non-controversial.

Mr. Lawrence

This is an important matter and it has come to the attention of most of us that the hon. Gentleman's right hon. Friend the Member for Birmingham, Sparkbrook (Mr. Hattersley), again, is not here to hear the introduction of a Home Office Bill being presented by my right hon. Friend the Home Secretary. The right hon. Gentleman cannot still be out to lunch at 4.30 pm.

Mr. Sheerman

That was an appalling intervention. Had I known that the hon. and learned Gentleman intended to make a dishonourable reference to my right hon. Friend, I should not have given way to him. My right hon. Friend is engaged on other important business. The Opposition are used to working as a team. Part of that team is here now and doing its job. We do not rely on one figure, as the Government often so obviously do. We work as a team.

The structure and ramifications of the Bill are complex, but the objective is simple—to deal with international drug-related crime. We believe not only that the bill will enhance the ability of the Government and their police force—and other police forces around the world—not only to tackle more effectively the increasingly sophisticated and globally active drug barons but, more broadly, that it will enable proper international arrangements to be agreed on criminal matters generally. It is important for the House to note that the Bill is not just about dealing with the drugs barons or the drugs traffickers.

Part I of the Bill relates to international crime. Again the Opposition welcome the abilities that it offers to the Government and police forces because crime is becoming global. Crime which starts off as a drug-related crime soon becomes a different type of crime as the money moves into different areas, different industries and different activities, not all of which are associated directly with the drugs trade. As the Home Secretary said, part I deals with mutual legal assistance—a formal tag for a simple procedure. It allows procedures by which states can co-operate with each other in the investigation and prosecution of criminal offences. It will allow us to ratify the 1987 European convention on mutual assistance in criminal matters, which is most important.

Our main worry about part I relates to clause 4 and specifically to a protocol to the convention which allows a foreign Government to require our Government—and which in turn allows us—to require a banker to reveal information about a fiscal matter which, while a criminal offence in the originating country, is a civil offence here. That issue arose on Second Reading and in Committee in another place and it is a point on which we seek further clarification. I stress that we are concerned that something which originates as a criminal offence in another country, especially relating to fiscal matters and to tax avoidance, may be a civil matter in this country. I know that there is a worry on both sides of the House that there could be a country somewhere in the world where unscrupulous individuals could use the provisions as a lever to gain information. That was not the intention of the protocol. I hope that the Minister of State will mention that in his reply. Certainly we shall return to the matter in Committee.

The Home Secretary will know that eight countries have signed the protocol and four—Austria, Norway, Sweden and Iceland—have expressed reservations about the fiscal provisions. If we express a similar reservation, it will not prevent us from signing the convention. We know from proceedings in another place that the Government argue that it is in our own interest to sign the convention in toto. However, we should like the Minister to give an undertaking that no future Home Secretary would allow another country's law to change our law.

Having dealt with part I of the Bill which, as I said, is the less contentious section of a Bill to which we have given broad support. Part II of the Bill, as the Home Secretary said, allows us to ratify the 1988 United Nations convention against illicit traffic in narcotic drugs and psychotropic substances. That is quite a mouthful, but we all know what it means. In short, it means ratification of the Vienna convention. There have been various treaties and conventions signed in Vienna, some of which have proved more successful in historical terms than others.

We welcome the clauses in part II dealing with the manufacture of precursors. I have talked to people in the chemical industry and the Select Committee also touched on the subject. I appreciate that it is a difficult issue, but we must attempt to control the raw materials used in processing coca into cocaine. There has been a cry from countries and from statesmen and stateswomen in south America and central America to control the sophisticated chemicals—the precursors—which come in from the United States and Europe and other parts of South America. That is a difficult matter and there is a certain pessimism in the chemical manufacturing industry about the efficacy of this measure and whether it will be the answer. Nevertheless, part of the answer is to control the flow of chemicals into countries where they are used to manufacture cocaine.

We also accept the need to tighten the law against money laundering. The Bill makes provision to tackle the illicit trafficking of drugs by sea and to ensure that drug trafficking offences are extraditable. The Home Secretary mentioned clause 21, which firms up existing provisions and improves the current position.

The one controversial aspect of my remarks involves money laundering. The Opposition are worried about this because the Bill's provisions for tightening the offence of money laundering are important and will be of great assistance to the police. I do not deny that, and no other Opposition Member would do so. However, we remain concerned about money laundering and whether the Government are doing enough about it, even in the Bill. Perhaps the Bill can be improved in Committee.

In a report published in November, "Drug Trafficking and Related Serious Crime", the Select Committee on Home Affairs said: The United Kingdom continues to be a major centre for money laundering. Indeed, the national drug intelligence co-ordinator, the NDIC, told the Committee that the United Kingdom was regarded by the United States, Canada and some others as an offshore banking system. That is a serious allegation from a body so close to the fight against drug-related crime.

That relates to some degree to the scandal of the Bank of Commerce and Credit International. The BCCI has 40 branches in the United Kingdom. In Tampa, Florida, this month that bank was convicted, having pleaded guilty, of three serious charges of conspiracy relating to money laundering and was fined between $14 million and $15 million. In a recent television programme that fine was described as a slap on the wrist for a bank involved to that extent in the money laundering business.

When I raised that issue with the Foreign Secretary recently, I was rather slapped down by the right hon. Gentleman, who was within a few days to attend a special assembly of the United Nations to discuss the drugs issue. I asked whether he thought that he might be taken more seriously at that assembly if he did something more energetic about money laundering. He replied: The hon. Gentleman's rhetoric is about four years out of date. This Government have been the pioneers in putting the necessary legislation through Parliament, in bringing that legislation into effect, and in negotiating agreements—of which there are now 13—with countries that have followed the same route."—[Official Report, 7 February 1990; Vol. 166, c. 882.] The right hon. Gentleman rather slapped me down, which concerned me in view of what was said the previous night—I have the transcript with me—in a BBC "Newsnight" Programme. Hon Members who are familiar with that programme will be aware that each programme involves an in-depth investigation of a particular topic. In the programme to which I refer, the laundering of drugs money and the various ramifications involved—[Interruption.] I have faith in that programme. Indeed, unlike some Conservative Members, I have great faith in the BBC. That programme went in some depth into the Tampa case and the involvement of the BCCI. It posed some awkward questions about whether the British Government and the Bank of England were taking seriously the amount of laundering that was going on in British banks every day of the week. It is estimated that £1.8 billion of drugs money comes to this country.

Mr. Waddington

It is all very well for the hon. Gentleman to go on in that way, but may we be told what amendment to the law he is proposing? What does he say is wrong with the drug trafficking offence that we pioneered? I should have thought that he would wish to give credit for the initiative that the British Government have taken. To the best of my knowledge, we were one of the first countries in the world to create a money laundering offence.

Mr. Sheerman

I regard the Drug Trafficking Offences Act 1986, which the Opposition supported enthusiastically, as an important first step. The Select Committee and others have expressed great concern—the point was put to the Bank of England when it gave evidence to the Committee—about the amount of laundering that is going on and about the fact that the present legislation is not catching much of it.

Mr. Joseph Ashton (Bassetlaw)

I was a member of that Select Committee. We visited bankers in Washington and spoke to the Customs and Excise. They expressed anger at the fact that it is possible for anyone legally to bring a suitcase full of drugs money into Britain, to pay it into a bank here and to have it immediately faxed to America. Practically every other country in the world insists that when visitors arrive by aeroplane they have to fill in a form stating exactly how much cash they have on their person and there is a strict limit—$1,000, or whatever, I am not certain of the figure—on how much they may bring in. In Britain there is no such limit—anyone can bring in any amount of money. That is why the Americans are angry about our lack of holding operations. We cannot detain people for, say, 24 hours while inquiries are made. That loophole in the law affects not just the Home Office but the Treasury. The previous Chancellor of the Exchequer refused to do anything about it because he thought it would interfere with currency control.

Mr. Sheerman

I am obliged to my hon. Friend for that intervention. I was making precisely that point. We are not against the 1986 Act, but it is clear from the Select Committee report that that measure is not catching the big money. Sums as large as £15 million to £20 million are relatively small in terms of the huge amounts that are still eluding the net.

The Minister of State, Home Office (Mr. John Patten)

A few moments ago my right hon. and learned Friend the Home Secretary asked the hon. Gentleman to explain not just his criticisms of the present situation, which we understand, but what he proposes should be done. What are the Labour party's proposals?

Mr. Sheerman

In addition to the points made by my hon. Friend the Member for Bassetlaw (Mr. Ashton), we believe that the Government should have responded faster to the Select Committee recommendations, which were published last November. It was clear from the evidence given by the Bank of England that the Government ought to take urgent action so as more effectively to catch drug laundering money.

Mr. John Patten

The Labour party has no policies a t all.

Mr. Sheerman

The Government should act following an investigation by an all-party Select Committee which exposed the scandal of Government inaction over the laundering of drug money in the City of London. The Government have not yet acted on the Select Committee's recommendations almost three months after they were made.

Although we support the Bill, we are entitled to criticise aspects of it. If we need more legislation, let it be enacted. Our fear is that the Government, who historically feel tenderness towards the City, are frightened to take the City on strongly, including telling the Bank of England that the present state of affairs is a scandal and telling the Foreign Secretary, the Chancellor of the Exchequer and the Home Secretary that something must be done.

Ministers ask about Labour policies in this sphere. New policies already exist in the form of the Select Committee's recommendations. If the Home Secretary would only act on them there would be a great improvement in the situation.

The national drugs intelligence co-ordinator estimates that £1.8 billion is received into the United Kingdom as a result of drug trafficking. The NDIC stated in a memorandum that vast sums were circulating in the legitimate banking system and might have a destabilising effect on the smaller financial institutions. Those sentiments have not been conjured by by me. They come from a leading expert at the sharp end of these issues. The NDIC said that, despite the 1986 Act, the United Kingdom continued to be a major centre for laundering money. I reiterate that many countries facing this problem see Britain as an offshore banking centre.

That being so, it is no use the Home Secretary and his junior Minister being complacent. They are the responsible Ministers, they have the Select Committee report, and they should be aware of the worries that have been expressed by their officials who, I believe, are urging them to take action. Unfortunately, the Government are weak when it comes to facing City institutions. It is about time that someone kicked the Bank of England. If the Home Secretary will not have a go, he should step down. If he thinks that it is the Opposition's job, let the Government resign and we will start doing the job properly.

Some of us are worried about how effective the 1986 Act has been. I do not want to labour the point, but the laundering of drug money is the cornerstone of the drug trade. If we can deal with that, we shall have largely solved the supply-side problem. The Bill does not deal with the demand-side problem, on which the conference that the Government are hosting in London in April will focus, but if Britain can take the lead in a United Nations effort and do something about the laundering of drug money, the drug trafficker will find life much more difficult.

The laundering of drug profits through the legitimate banking system was the most disturbing part of the Select Committee investigation. When the Bank of England was asked by the Select Committee what further measures it would recommend, it could not think of any. That answer jumps out at us from the page. If the Government told the Bank of England to suggest proposals which would effectively prevent London from being a centre for the laundering of drug money, it would come back with effective measures which could be implemented quickly.

This is not a party political point. I am simply saying that it could be done. It must be possible to stop the laundering of such money and the Bank of England should have the expertise to advise the Government to do so.

We support the Bill and we shall give it a fair wind on Second Reading and in Committee, but we shall not let the Government off the hook if they refuse to give the City the big kick up the backside that it deserves with regard to the drug money laundering scandal.

This is the most controversial part of my speech and I know that the Home Secretary and the Minister of State do not like what I have said. Nevertheless, it is three months since the Select Committee published its report, so why have the Government not called in the Bank of England and told it to produce solutions? Will the Home Secretary talk to his Cabinet colleagues and find out what they are doing about the Bank of Credit and Commerce International and other banks suspected of being up to their elbows in this kind of money laundering?

The Government's decision, to judge from remarks made in another place, to shift the burden of proof rather than reversing it is welcome and is to be commended. To reverse it would be a far-reaching change in our criminal law and a dangerous precedent.

We shall be going into the detail of the Vienna convention in Committee, but I will deal with two important aspects now. Article 5(b) provides that, when acting on the request of another party, special consideration may be given to concluding agreements or contributing the value of confiscated proceeds to intergovernmental bodies specialising in the fight against illicit traffic and drug abuse. To put it more simply, if a lot of money was recovered after an international operation, it should go not into various Government's coffers or the Consolidated Fund but into a special fund to provide the resources to do the job even better. The Select Committee got that right.

I would go further than that and say that the Home Secretary should also talk to the Chancellor of the Exchequer because money recovered in Britain could be used to give a wonderful incentive to police officers and other intelligence people. They may not need that, but it would be a marked advance if money recovered from a sophisticated operation, taking many man hours and a great deal of time, energy, effort and money, went back to the police departments and investigative agencies involved. That is a simple but important concept.

A drug informer who had been a constituent of mine for a year, who was not guilty of or charged with any offence, gave information which led to the recovery of an enormous amount—three large hauls—of cocaine. I had to fight long and hard to obtain recompense and a new identity for him, and it was only after many months that I achieved that. It was not that people, having wickedly used the man, said that he could get on his bike and go, but the Home Office and the police said that there was no money available to pay for that. Progress has been made in the past two years and more money has been made available, but there is still not enough cash to fight the drug menace. Preventing the proceeds of such operations from slipping back into the Consolidated Fund would mean extra cash to fight the drug menace. It would be nice for poll tax payers facing a 13.5 per cent. increase to pay for the police to be able to think that a big recovery of drug money would go back to those who had had to spend money providing the expertise necessary to make the operation successful.

Mr. Waddington

rose——

Mr. Sheerman

Before the right hon. and learned Gentleman says anything else, will he comment on the rumour that there are millions of pounds locked up in Washington which the United States Government would like to give to the Metropolitan police but that at present there is no mechanism to do so? Will that money be payable to the Metropolitan police when the Bill is enacted?

Mr. Waddington

I sought to intervene to remind the hon. Gentleman that some time ago the Government announced that provision is being made in 1990–91 for a central fund to meet some of the additional costs of international drugs investigations by the police—including rewards to major informants—out of the seizures of illegal drug assets.

Mr. Sheerman

I thank the Home Secretary for that. I acknowledged that steps have been taken, but if money recovered flowed into such resources it would make operations against drug barons even more effective. I take the Home Secretary's point. That fund did not exist when I was battling for my transient constituent. Nevertheless, it should be a great deal more.

The Government should make it clear that confiscated funds should help towards the overall effort. The Select Committee recommended that such funds should go to a central fund administered by the Home Office. That is an excellent recommendation. I hope that the Home Secretary will respond positively in the short run. Money could then go back to the investigating agencies and—I hope that the Home Secretary will look warmly on this—to rehabilitation and education programmes. The Home Secretary has much to gain from having common cause with the Secretary of State for Health. Part of the money should go to fight the war against the drug barons and part to the education and rehabilitation programme which is so under-resourced.

Mr. Waddington

How much would the Opposition dedicate to that programme?

Mr. Sheerman

I am saying that we would——

Mr. Martin M. Brandon-Bravo (Nottingham, South)

Answer the question.

Mr. Sheerman

I am in the middle of an answer. I do not need the Parliamentary Private Secretary to tell me how to answer a question. I was about to say that I have already given the policy. The policy is that a fund should be built up from the proceeds of cracking the illicit trade. Many millions of pounds could be used in that way. After the next election a Labour Government would take that course.

Mr. Waddington

That is not an answer to my question. If a fund is built up from money seized, that money could be used for a variety of purposes. As the hon. Gentleman is apparently criticising the budget available for education and rehabilitation, we are entitled to know what budget he has in mind and how much the Opposition would spend.

Mr. Sheerman

The point I am trying to make is that we want a substantial appropriation of funds for education and rehabilitation programmes because the drug problem is tremendously important and we have not yet taken it seriously. In a moment I shall refer briefly to demand reduction. The Home Secretary and his colleagues like to appear on television making dramatic gestures. I want to give him the opportunity to say that the drug fund would go partly towards pursuing the criminals more effectively and partly to picking up the pieces in society which result from the ghastly, murderous trade. Young children could he educated so as to prevent them getting under the thrall of drugs. There could also be educational and rehabilitation programmes for the victims of drug addiction.

In volume II of the Select Committee report, page 160, the Home Office memorandum says that article 2 of the United Nations convention makes an important point about sovereignty. I hope that the Home Secretary will bring it to the attention of the Foreign Secretary. According to the memorandum, the convention may even be helpful in countering the exorbitant claims to jurisdiction often made by the United States That was well said. Anyone who has spent time in south America will know that the people are sensitive about the United States using one rule on jurisdiction in one part of the globe and another in south America.

Article 14 of the convention relates to measures to eradicate the illicit cultivation of narcotic plants and the illicit demand for drugs. That is a worthwhile section which will be difficult to carry out. Hon. Members who take the matter seriously are worried about simplistic solutions. In a peasant economy such as Peru or Colombia, it is wrong to burn the fields of coca or attempt to introduce a caterpillar or beetle to destroy the coca crop without knowing what damage may be caused to other crops. I hope that the Government will take a positive attitude.

These matters do not relate just to the Home Office. If we are to do anything about the supply, right back to the grower, we have to face the fact that we spend very little money on overseas aid to south America. There was a little extra last year but aid for the whole of south America is only about £12 million. People in the West must get the message that they cannot burn or spray the crop from helicopters or introduce beetles to destroy it. We must offer people in the Third world alternative markets, alternative crops and alternative ways of earning a living. The simplistic solutions tried by some western countries have had appalling effects on the population.

I know only one south American country well—Peru. When one sees the poverty in Peru, one is not surprised that the peasants are forced into coca production when that is the only thing that they can grow. They must be given a genuine alternative. That does not come from helicopters or from slogans but from resources being put into alternatives to make the economy work differently.

Article 14 states that measures taken to prevent illicit cultivation should respect fundamental human rights. It puts a finger on an important point. If we are to have respect for human rights, we must give them the proper environment in which to flourish.

Article 14 also refers to the protection of the environment. We may talk glibly about the protection of the rain forests and about global warming, but we cannot criticise people who are struggling to make a living when we in the West shot the buffalo and killed half the animal species in the world when we were industrialising, and we are still the worst polluters. So when we talk about protection of the environment, we must do so sensitively.

I remember being shown the front page of the leading newspaper in Brazil the morning after a European initiative which criticised the damage to the environment caused by cutting down the rain forests. South American countries do not want to be patronised. They want to be talked to intelligently so that we and they can find solutions together. Article 14 is a valuable safeguard against spraying crops, the introduction of grubs, and so on.

I wish to conclude on the subject of demand reduction, although it is not covered by the substance of the Bill. While the Bill is important, it deals with only half the problem. Some people regard that half as the least important part of the problem because demand reduction is the most effective way of reducing the drug menace. The convention relates basically to the supply side, but we must not be preoccupied with that to the exclusion of demand at home.

When last week I criticised the Home Secretary for going to the United States, I did so constructively. He should have gone to other countries in Europe which, because of their experience, would have much more to tell us about drug culture than the United States. The experience of the United States is special in one sense, and I thank heaven it is. If the Home Secretary were to talk to his opposite numbers in Germany, Holland and France, he might learn much more than he did on his trip to the United States. The United States, to its cost, made the mistake of concentrating on the supply of drugs and did not put enough effort and resources into demand reduction until it was too late. To stem the flood of drugs, it is more effective to stem the demand from people who use the stuff than to stem the supply.

We can talk as much as we like, and we shall give the Bill a fair wind—it will not take long to get through the House—but this is a complex matter and the problem will not be solved by one short Bill or Act. Drug addiction and the drugs problem are related to supply and demand in terms of their causes. For example, I have mentioned that on the supply side there is the question of what peasants have to do in certain countries of the world. On the demand side, the drug problem is rooted in poverty, deprivation and unemployment.

Mr. Waddington

If the hon. Gentleman is right, why was there not more drug taking between the wars? If he is right about deprivation, why was there not a greater drug problem when there was far more deprivation? He is talking nonsense.

Mr. Sheerman

That is the most depressing remark that I have heard from the Home Secretary since he took office. All the informed opinion dealing with drugs and drug addiction has stressed time and again that the problem is related to deprivation and to the poor parts of our cities and towns. I am not saying that as a Labour supporter—across the political spectrum, people who know about the drugs problem are saying that. One can track it and trace it and see the hot spots in our country.

In the 1920s and the 1930s, between the wars, like most fashions it was high society and the upper classes in this country who were the drug addicts and who were involved in drug taking. The problem was small. The Home Secretary shakes his head. Yet he used to have some claim to being a social scientist—[Interruption.] Well, he was a geographer and they sometimes claim to be social scientists. We could have a debate about whether geography has any claim to scholarship, but not today.

I answer the Home Secretary by saying that fashions begin among small sections of the population and are perhaps harmless. When they spread down to a large section of the population who do not do it as a quick thrill and then move on, it becomes a different problem. That is what has happened in the United States and it is certainly what has happened here.

I repeat—and I beg the Home Secretary to think again—that the root of the drugs problem is in deprivation and misery, and unless the Government do something about that they will never tackle the problem completely and comprehensively.

5.12 pm

Sir John Wheeler (Westminster, North)

I shall begin by using some of the words of the hon. Member for Huddersfield (Mr. Sheerman). He is right to say that the extremely complex question of drugs and the control of drug-related crimes will not be solved by simplistic solutions.

The hon. Gentleman leaned heavily on the work of the Home Affairs Select Committee in his speech this afternoon. However, it seems to me that he failed to respond and to suggest what additional improvements he would make to the criminal law to deal with some of the issues. I do not mean to say that in a partisan way, but perhaps the Opposition would have been assisted if the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) had been present this afternoon to lend his knowledge, skill and interest in the subject to the debate. Perhaps he would have answered some of the questions posed to the hon. Member for Huddersfield, and which—I say this in a kindly way—he understandably was unable to answer.

Mr. Sheerman

I am surprised that the Chairman of the Select Committee on Home Affairs makes that point. My right hon. Friend is the deputy leader of our party, as well as the home affairs spokesman, and that imposes a great range of duties over and above the duty of being shadow Home Secretary.

Sir John Wheeler

I am grateful to the hon. Gentleman but I repeat—in as non-partisan a way as I can—that the most important duty upon hon. Members is to attend the House and to participate in debates, particularly about issues as serious and important as this one. I leave it at that.

I greatly welcome the response to the Home Affairs Select Committee report from my right hon. and learned Friend the Home Secretary and my right hon. Friend the Minister of State. The Home Affairs Select Committee can claim to be the one Committee that receives almost instant, but considerable, response to its recommendations. My right hon. and learned Friend responded within 14 days to the Select Committee's report on the Criminal Injuries Compensation Board scheme, and handsomely so.

Today's debate is in part a response to the recommendations made in November 1989 to the Home Office by the Select Committee in its report on serious crime and drugs. I know that my right hon. and learned Friend has to respond to the other recommendations in that report as soon as possible—no doubt soon after the conclusion of the debate today.

Mr. John Patten

My hon. Friend has been extremely courteous about the rapid response that the Home Office always tries to give to Home Affairs Select Committee reports. He cited the recent report on the Criminal Injuries Compensation Board scheme. However, today we are debating, in part, the Select Committee's report on drugs. Does my hon. Friend agree that some of the recommendations of his Committee, such as those impressing upon us the need to ratify the 1988 United Nations convention against illicit traffic in narcotic drugs and psychotropic substances, and the 1957 European convention on mutual assistance in criminal matters, are already dealt with in the Bill?

Sir John Wheeler

My right hon. Friend is absolutely right. The Committee made those recommendations in November last year, and in the brief intervening period since his Department was able to consider the recommendations.

To use the phrase of the hon. Member for Huddersfield, these are complex matters which cannot be dealt with on a simplistic basis. My right hon. and learned Friend has considered the issues, consulted the Law Officers of the Crown and the many other agencies involved, and has come forward with a Bill which I am delighted to learn will enjoy the support of the whole House, subject no doubt to some debate in Committee. It will put on the statute book the recommendations of the Select Committee which we believe—on an all-party basis—are central to the war against drugs and serious crime. I am grateful to my right hon. and learned Friend for the way that he has responded.

I shall go through some of the issues, and touch upon some of the matters raised in the debate so far, including money laundering and the role of the Bank of England.

The Select Committee concluded that one of the most serious policy issues facing the Government and the country as a whole was that of drugs and drug-related crime. We therefore undertook an inquiry into the subject last year. We were so concerned about what we discovered about the threat of crack that we published an interim report in July 1989, to which my right hon. Friends have responded, and we followed it up with a more substantive report in November last year.

In the later report, we made it clear that we were in no doubt that law enforcement had a major role in countering the problem of drugs and serious crime, although it is not the only answer: demand reduction and the operation of the health services are also important. We also made it clear that we were entirely opposed to the legalisation of illicit drugs, which we believe would undermine all aspects of the British strategy for tackling drugs—a strategy that the Government have well in hand.

The report stated—and the Bill echoes it—that drug trafficking is, by its nature, an international problem. It requires international action. We examined several aspects of international co-operation, and concluded that the 1988 United Nations convention against illicit traffic in narcotic drugs and psychotropic substances represented a milestone in international co-operation. We said that the British ratification of the treaty, which will require changes in the law, was a matter of great urgency. I am glad that the Bill has responded to that need. The report also discussed ways of combating the problem of money laundering, which has already been mentioned today. Drug trafficking, we said, is extremely lucrative and drug traffickers are motivated by greed.

The hon. Member for Huddersfield is right about the poverty in some south American countries. Where he is wrong, I think, is in suggesting that the people who live in poverty there are the same people who benefit from the drugs industry. They gain very little from it; those who gain most are people who live in other countries—principally the United States—and those involved in the manufacture of drugs and their movement round the western countries.

The report went on to say that success in tracing and confiscating assets is an important aspect of the campaign against the drug trafficker. Tracing and seizure would be more effective if some of the measures in the Bill were implemented. We suggested that the proceeds of drug profit confiscation should go to a central fund administered by the Home Office: my right hon. and learned Friend has yet to respond to that part of the report, but I know that he will do so shortly. We also spoke of the importance of intelligence gathering and effective law enforcement, within the United Kingdom and elsewhere in the European Community. After Easter, the Committee will turn its attention to policing co-operation in the Community in the 1990s.

The Committee recommended that the Government should instruct the Bank of England, as a matter of urgency, to examine the scale of the threat to the banking community posed by money laundering and any legislative or other changes required to counter it. We expect the banking community and others with relevant expertise to co-operate fully with this investigation. The Government should then come forward with the necessary amending legislation as a matter of priority. I note that the hon. Member for Huddersfield was unable to produce any amendments to the law. That may be because, having read the Select Committee report, he discovered that those who gave evidence believe that British banks, building societies and other related financial service industries were co-operating to the fullest extent with the police and customs authorities in this country.

Our problem is not a failure to co-operate on the part of the banking institutions, but the more complicated question of how money is laundered internationally through the world's banking economy. It would be simple indeed if we could identify a block of money in a bank in the United Kingdom as having originated from the proceeds of illicit drug trafficking; in that event, the existing 1986 Act and this Bill would together deal with the problem.

The problem for the banking authorities is that money moves from country to country, and from one company or place of origin to another, and it is difficult for the receiving bank to identify precisely the ultimate owner of a block of money in an account. If we could discover that, it would be relatively easy to deal with the consequences.

I believe that the Bank of England must give a lead. I hesitate to suggest what it should do, but I suspect that it should cancel a licence for a bank in the City of London. Again, I hesitate to nominate a candidate, but let me venture to observe that if the world contains a bank whose principals—either directors or senior and responsible managers—have been convicted of being knowing parties to money laundering, that bank may be such a candidate.

Until those who sit on the board of a bank, or who have an executive responsibility for the management of its affairs, fully comprehend that their shareholders' interests—and its future as a bank—rest on their personal integrity and their accountability for the management of its activities, they may be tempted not to address the problem of where the money goes as seriously as we would wish. It is not for my right hon. and learned Friend, or for the Government, to instruct the Bank of England about what it should do. The Bank of England will have to accept that responsibility and take a decision.

I suspect that there will be accountability only when the Bank of England cancels the licence of a bank to act as part of the United Kingdom's banking community. But we must remember that no advantage would be gained if the bank simply shifted its operations to Paris, Frankfurt or elsewhere. The same money laundering would occur throughout the world's economic system. The Bill would strengthen international co-operation between European Economic Community countries, the police and other enforcement agencies in an effort to prevent that from happening.

I warmly welcome the proposals. They represent an important contribution to the Government's efforts to deal with international crime, especially drug trafficking. I know that my right hon. and learned Friend has visited the United States and that he has seen what I saw when I visited Washington—the impact of drug trafficking on a community and the immense destruction that it causes. I know that he was as horrified as I when he saw how young people were drawn into this evil habit and then became drug traffickers. I was present when the Washington police arrested a notorious drug trafficker—a boy of 12 who was adept at managing his business on the streets of Washington.

One also has to consider the awesome consequences for the tens of thousands of babies who are born to crack-addicted mothers, many of whom will have to he cared for in institutions for the rest of their limited lives. The problem is so serious as to require us to go to the limits of the criminal justice system. We have to achieve a correct balance between the rights of individuals and the needs of society as a whole. We enshrined an important principle in the 1986 Act by requiring the banking community to reveal the contents of bank accounts when it was believed that the proceeds related to drug trafficking. No one now believes that that was wrong. We wish to build upon that principle. However, we shall be successful only if we understand precisely the implications of all the decisions that we make and only if we win international co-operation, particularly in Europe.

The Bill is a response to the Select Committee's recommendations in November 1989. It will ensure that these important developments continue. I welcome the Bill. The sooner it reaches the statute book the better.

5.32 pm

Dr. Norman A. Godman (Greenock and Port Glasgow)

I shall be extremely brief, Madam Deputy Speaker.

I congratulate the hon. Members who served on the Select Committee on their first-class report. As a comment on drug-related problems and crime that is activated by drugs, I wonder how many people died last year in the United Kingdom as a result of their addiction to crack, cocaine and heroin, compared with those who died as a result of their addiction to tobacco and all forms of alcohol.

The laundering of money is a major criminal activity which has gone largely unchecked in the United Kingdom. That problem must be tackled more rigorously and in a much more tough-minded way. I hope that the Minister of State, the right hon. Member for Oxford, West and Abingdon (Mr. Patten), will answer two questions. I am pleased about the contents of clauses 17 to 20, whose object is to tackle more effectively the problems that are associated with the seaborne trade in illicit drugs. That is very important for Scotland, given the plethora of islands and its extensive coastline.

I ask the Minister to look again at those clauses. I am not a lawyer or a parliamentary draftsman, but I am a little concerned about the definition of a British-owned ship—hence my earlier intervention during the Home Secretary's speech. That vague definition needs to be tightened up when the Bill is considered in Committee. I ought to point out to my hon. Friend the Member for Huddersfield (Mr. Sheerman) that I do not expect to receive an invitation to serve on the Committee.

This is an important question; the Minister of State has with him a platoon of civil servants who may be able to answer it. How do clauses 17 to 20 relate to clauses 3 and 14 of the Merchant Shipping Act 1988? On October 1989, the president of the European Court of Justice took issue with Her Majesty's Government on the definition of a British-owned ship. According to his interim injunction, the Government had to suspend the use of the term "British-owned" in section 14 of that Act.

Why is there no mention in clause 20 of Scotland's Law Officers? Clause 20(1) refers to the United Kingdom. Reference is made to England, Wales and Northern Ireland in subsections (2)(a) and (b), but there is no mention of the Crown Office, or the role of the procurators fiscal. Absence of any mention of the Crown Office is particularly noticeable to me.

I promised you, Madam Deputy Speaker, that I should be brief. I hate to break promises to you, especially when you are sitting in that Chair. Schedule 3 relates to enforcement powers in respect of ships. I take it that, in addition to police affairs and Customs and Excise officers, the definition of an enforcement officer includes members of the fisheries protection service employed by the Department of Agriculture and Fisheries for Scotland and to members of the Royal Navy who may be called upon to apprehend a vessel in, I presume, United Kingdom, not British, territorial waters.

Under the terms of the Bill, will those enforcement officers have the right to continue the pursuit of a perceived transgressor into international waters or the waters of those nations whose coastlines front the North sea or the waters of European Community states? I understand that, under the treaty of Rome, we have joint control over the waters surrounding our coastline.

In conclusion, I am slightly concerned about the wording relating to unregistered ships. Can I assume that consultation took place with officials and elected representatives of other states within the European Community and bordering the north Atlantic? The highest degree of co-operation is required with law enforcement agencies, particularly the maritime divisions of those agencies, in the pursuit of those who would conduct seaborne trade in those dreadful drugs.

5.41 pm

Mr. Chris Butler (Warrington, South)

I welcome the Bill, which will enable us to ratify the Vienna convention, and I should like to associate my welcome with that of my hon. Friend the Member for Lewes (Mr. Rathbone), the chairman of the all-party drugs misuse committee, who unfortunately is not able to be with us this evening. I know that he would have wanted to support the passage of the Bill with all his energy and commitment.

My right hon. and learned Friend the Minister of State, Home Office, the Member for Putney (Mr. Mellor), said earlier this year: There has never been a year when more effort has been made by the trafficker to bring his wretched product into Britain.". Britain is not only a major consuming country for drugs; it is a major transit country. In 1989, our customs seized £259 million worth of illegal drugs—40 per cent. up on the previous year. The cocaine market in the United States is just about saturated, and increasingly the international drug barons are targeting the United Kingdom and Europe for a new market.

Over the past four years, cocaine seizures in Europe have risen by 600 per cent. From the peasant who grows the coca leaf in south America to the street trader in drugs, the mark-up is about 12,000 per cent. That enormous profit does not go to the peasant grower, whose life remains marginal; it does not even go to the pusher on the street, God damn him. It goes to the international drug baron and his cronies. A determined international effort is needed to uproot him.

We now have an example of how a determined international effort can work. I learnt on the news last night that "the extraditables" are now offering themselves up and surrendering to the Colombian Government, provided that they are tried in Colombia. That is a massive step forward. The Economist would never have believed it.

Some of us who were brought up on "Fabian of the Yard" and programmes such as "No Hiding Place" have quite a respect for our police system and our courts of law, so it was rather a shock to me, when I served on the Committee on The Criminal Justice Bill to find that our extradition procedures were so deficient. The Criminal Justice Act 1988 made useful progress, but it is embarrassing that we have not yet ratified the European convention on mutual assistance in criminal matters. That was established 33 years ago, perhaps even before "Fabian of the Yard". As we begin to co-operate more, partly through the passage of this Bill, others will be more inclined to co-operate with us in the international battle against drugs.

I welcome the measures in the Bill to clamp down on precursor substances. The so-called producer countries, rather paradoxically, blame the West for their problems, because the West produces the demand for their drugs and the developed countries produce the chemicals that make up the drugs. The ex-President of Colombia said in 1989: Our efforts to reduce the supply of refined cocaine also depend on international co-operation in stopping the illegal trade in chemicals which are essential to the processing of this drug. Generally, much attention is given to the production and processing of drugs … Unfortunately, in contrast, little attention is given to controlling the supply of chemicals which are used to process cocaine and which come mainly from North America and Europe. None of these are manufactured in Colombia—all of them are smuggled into our country. Tightening controls on the manufacture and sale of these chemicals, as well as strengthening sanctions against their illegal shipment, must be one of our highest priorities. It takes more than coca leaf to produce cocaine. Without the chemicals there would be no narcotic". I welcome clause 12, but I am inclined to ask my right hon. Friend why we have to schedule the precursor substances; why not make illegal all the substances which are used knowingly to produce illicit drugs?

I was then drawn to clause 13. I accept that scheduling is probably required to control the trade in these substances, but I do not see why it is necessary to schedule the substances for control in clause 12, as one always runs the risk of the list not being exhaustive. Casting my eyes over the list, I thought that I might have noticed that one or two chemicals were missing, such as urea. I accept that they could be added later, but there is here a potential deficiency in the Bill that could be examined more closely in Committee.

Clause 16 closes an important loophole in the Drug Trafficking Offences Act 1986 so that we will now be able to confiscate ill-gotten gains that have been concealed until late in the day. That Act has proved its worth. Last year, some £15 million-worth of assets were seized.

We are in a competitively communautaire world, and I should like to take the opportunity briefly to berate Holland, Spain and Portugal, as they have dragged their feet on producing similar legislation. However, I share a major criticism with the hon. Member for Huddersfield (Mr. Sheerman) about the operation of the Bill. The money seems to disappear back into the maw of the Exchequer. Police resources which are likely to be further stretched by the operation of the Bill will not be boosted.

There is indeed a case for recycling some of the money to reduce demand. In my own town of Warrington, the drug dependency unit is severely stretched and could greatly benefit from recycling some of the money. There is even an argument for recycling some of the money to producer countries when they have been instrumental in any arrests that have been made.

The bugbear is the old Treasury doctrine of hypothecation. The preamble to the Bill says: The overall costs are likely not to be significant and to be more than offset by the increased revenue from confiscated assets. The principle of hypothecation is broken in the preamble to the Bill. I hope that in practice it will be broken and that there will be proper recycling of moneys to fight the drug trade.

In previous speeches on drugs, I have called for the establishment of a national force to fight the drug barons, which, given my liking for Eliot Ness, I have tended to call "the Untouchables". I do not know whether Sir Peter Imbert reads my speeches, but I gather that he has called for a national operational arm to engage in the fight against drugs and international crime.

We should put aside regional jealousies in the fight against international criminals. I hope that my right hon. Friend the Minister will be able to signal some favour to that general idea.

5.50 pm

Mr. Ivan Lawrence (Burton)

I do not agree that regional jealousies interfere with the activities of our superb police forces, although there is an argument for increasing centralisation of drug enforcement procedures.

Like my hon. Friend the Member for Warrington (Mr. Butler) and other hon. Members who have spoken, it is not possible for me to do other than to welcome the Bill warmly. It recognises that, in criminal matters at least, we are no longer an island entire of itself; we are part of an international community, and our criminals are part of an international fraternity of criminals. All states that operate under the rule of law must act together to combat crime; otherwise, the forces of good will not prevail over the forces of evil.

Nowhere is that more true than with drugs. The raw materials for many drugs may be grown abroad and there may be distribution abroad, but there is also distribution here. There is manufacture abroad and here; there is consumption abroad and here; and the proceeds are laundered abroad and here. It comes as a surprise that, after so many years and so many international conferences, conventions, resolutions and legislation, so many loopholes and deficiencies make enforcement of the rule of law so far from complete, and not only in the drugs field.

It comes as a surprise to some of us to learn that we cannot serve on individuals in the United Kingdom summonses relating to another country's criminal proceedings, or it on ours, and that we cannot always obtain evidence from foreign countries to advance an inquiry here, of they from us. There have been notable cases of that, such as when the Swiss were reluctant to assist us in our inquiries until the point was reached when we could charge individuals, when they relaxed some of the restrictions that protect their banking system. International co-operation on such matters definitely needs to be improved.

It comes as a surprise that we are unable to transfer our prisoners to give evidence in foreign proceedings, or that foreign countries are unable to do likewise with us. 11 comes as a surprise that our police canot search and seize on behalf of other countries and that court orders for forfeiture of cars, guns or other equipment used in criminal offences abroad cannot be made here.

We passed the Drug Trafficking Offences Act 1986 to fulfil a promise to seize the proceeds of drug-related crime. It appears from this Bill that we did not draft it properly or well enough. I did not realise that it was not an offence for a person to manufacture a scheduled substance or to supply such a substance to another person, knowing or suspecting that the substance is to be used in or for the unlawful production of a controlled drug", which is the essence of clause 12. I am pleased that we are now making that an offence.

I had no idea that we had no power to enable enforcement authorities to obtain intelligence about drugs and chemicals from those who produce them. I am relieved to hear that the drug companies have given that information voluntarily, and that it is only to comply with the convention that we are making the matter statutory.

Everyone except the drug offender will be in favour of tightening the laundering proceedings. Most of the defects in the law I suspect, arise in detection and enforcement rather than in the framing of the exact law. I shall read section 24 (1) of the Drug Trafficking Offences Act—I cannot remember whether the House was better attended by lawyers at that time—to remind hon. Members of precisely what we are capable of drafting: Subject to subsection (3) below, if a person enters into or is otherwise concerned in an arrangement whereby—

1. (a) the retention or control by or on behalf of another (call him "A") of A's proceeds of drug trafficking is facilitated (whether by concealment, removal from the jurisdiction, transfer to nominees or otherwise), or
2. (b) A's proceeds of drug trafficking—

1. (i) are used to secure that funds are placed at A's disposal, or
2. (ii) are used for A's benefit to acquire property by way of investment,

knowing or suspecting that A is a person who carries on or has carried on drug trafficking or has benefited from drug trafficking, he is guilty of an offence. That section cries out for clarification, and it is welcome that we are doing so.

I was a little unkind in interrupting the speech of the hon. Member for Huddersfield (Mr. Sheerman) to ask whether the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) was on his way here. Perhaps I can make amends by supporting to a small extent a point that he was making about the feebleness of banks in dealing with laundering.

I remember that, in the Brinks-Mat gold bullion case, hundreds of thousands of pounds of gold were being taken every day to a branch of one of the leading high street banks, which paid out hundreds of thousands of pounds daily. The gold was being provided by a small trader, yet no one suspected that it might be the proceeds of the gold bullion robbery which everyone was talking about and which was all over the newpapers. There has been suspicion about some banks' lack of enthusiasm in spotting money movements in drug laundering cases as well.

Mr. Sheerman

rose——

Mr. Lawrence

I was about to say that the hon. Member for Huddersfield probably went over the top in his attack on the banking system, but it appears that he is about to go even further over the top.

Mr. Sheerman

The point I was making is that £15 million of an estimated £1,800 million is a small percentage. I was trying to highlight the fact that we could do better and that we should expect the Bank of England to know which mechanisms it could introduce to make the high street and commercial banks more responsible in their attitudes, starting with the scandalous activities of a few banks, which should be dealt with quickly.

Mr. Lawrence

I take that point. However, it is more a matter of those who are dealing with the money having a feel for inquiry, rather than having statutory rules laid down specifically for application in every case. The hon. Member for Huddersfield has made his point, and I have done my small bit to give it some support.

I like the tightening up of confiscation orders under clause 15, so that a defendant cannot delay payment of £2 million to make about £100,000 in six months for his family and friends to enjoy. That is a sensible development.

Enabling full co-operation to take place to suppress illicit drugs being carried by ship is constructive and will, I hope, be effective. I must say, though, that one gets the impression that the coastguard and Customs and Excise forces do a very efficient job in stopping this country being invaded by drug smugglers merely because it is an island.

I want to remain in order, so I shall not be tempted to stray from the provisions of the Bill to the wider consideration of international co-operation and drug control. However, some further tribute should be made to the Government for their work to reduce drug crime and the scourge of drugs, which can so easily destroy not only the lives of individuals and children, but the fabric of our nation and the civilised world itself.

The Government have been working with locally based drug prevention teams, stimulating community action from which only good can come. They have been developing an anti-drugs campaign since it was spearheaded by my right hon. Friend the Prime Minister. Money is spent on the distribution of information to schools and education institutions. There is active assistance in getting producer countries to reduce the growing of opium and cocaine, which was referred to by my hon. Friend the Member for Warrington, South and others. We are the fourth largest donor to the United Nations fund backing enforcement programmes internationally.

The number of customs investigators has been trebled to 400 since 1979, and 450 other customs staff have been allocated to drug-related work. There is the national drugs intelligence unit, about which observation has been made, with its 17 new police regional crime squad wings all co-operating within a national organisation.

There were 38,000 seizures in 1988, which is an increase of 25 per cent. over 1987, and, if my hon. Friend the Member for Warrington, South is right, a 40 per cent. increase last year over the year before. The enforcement measures of our laws resulted in a record 30,500 convictions last year, which is an excellent record of anti-drugs activity by the Government, who are not complacent and who believe that more needs to be done.

Mr. Stuart Randall (Kingston upon Hull, West)

I have heard that shopping list before. One always wants to encourage all efforts, but has the hon. and learned Gentleman fully thought through the whole argument about whether the Government have been successful? Although several measures have been taken, and although there is a lot of complimentary talk, the rate of drug-taking and drug abuse is growing phenomenally. How does the hon. and learned Gentleman square those two facts?

Mr. Lawrence

A great deal of effort is being expended by the Government in stopping that growth, and I have no doubt that much growth has been stopped. I am not saying that it is sufficient for the Government. The Government are not saying that it is sufficient; nor are they being complacent. I am sure that they will continue to tackle the problem in the resolute manner in which my right hon. Friend the Minister addresses every problem. I want to pay tribute to the Select Committee on Home Affairs for its report and recommendations, which I hope will be taken up further in the months ahead.

Through the Bill, my right hon. and learned Friend the Home Secretary will reduce the possibility that criminals can cross national borders with impunity. I hope that he will also be successful in his negotiations with other countries in the European Community in dealing with cross-border activities in crime and drugs.

My right hon. and learned Friend will reduce the possibility that clever criminals may take advantage of the differences in legal systems of the international community to pursue their criminal enterprises. He will increase the chance that, with international co-operation, there will be no place for the criminal to go free from the fear of prosecution and punishment. I know that that is so, because that is almost a direct paraphrase of a speech that my right hon. and learned Friend made in December 1989.

I want finally to relate to my right hon. and learned Friend the observation of an international drug baron, who asked his barrister recently what sentence he was likely to receive and how much money would be confiscated from him. When he was told that he was lucky not to have been caught in Malaysia, in Singapore or in Taiwan, where anyone flying into the country will see in the document handed to him on the plane that the penalty for drug trafficking is death, he said: Ah, but I would not have trafficked here in Britain if there had been the death penalty. There must be a moral in that story.

6.5 pm

Mr. Stuart Randall (Kingston upon Hull, West)

In my brief comments tonight, I want to begin by saying that, as my hon. Friend the Member for Huddersfield (Mr. Sheerman) has already said, we support the Bill. We support it because of its broad aims. First, it will ratify in legislation the conventions in the fight against international crime, which have been referred to today. Secondly, the Bill will facilitate co-operation between nations. Over the years, crime has become more international, so it must be important that our institutions adjust their way of operation to help to combat international crime. Clearly, international co-operation is vital.

I can sense that we are achieving co-operation on the Bill this evening between Her Majesty's Opposition and Her Majesty's Government. Although there is a feeling of co-operation, I want to suggest constructively that the Opposition are very worried about the question of money laundering. As we are all co-operating here this evening, and as there is international co-operation, I hope that the Minister will let us know specifically what the Government intend to do about money laundering and what discussions the Government have had with the banking industry nationally and internationally, and with the Bank of England. What are the attitudes on the issue?

The reason why money laundering is so important is that drug trafficking and other aspects of international crime are very lucrative. Drug traffickers tend to be very greedy people who make huge sums. The people who make most money out of drugs are those who move the products and the money around the world. We need international co-operation to improve tracing and seizure. The problem lies in the way that money is moved around the world, and the banks themselves have terrific difficulty in establishing what money has been moved to whom. The audit trail is difficult and complex.

I welcome the valuable contribution of the Chairman of the Home Affairs Committee. Particularly welcome to me, and, I am sure, to the Minister of State, was the statement on the way in which the Bank of England had been asked to look into the whole question of money laundering and to see how the banking industry, both nationally and internationally, could make a contribution in this field. I understand that, so far, the banks have not made a statement and that the Government have not yet responded.

As there is such co-operation today on this very important issue, I am convinced that the Minister will tell us clearly what the Government's policy is on laundering and what specific steps we can expect the Bank of England to be encouraged to take, as well as what specific action will be needed internationally. No doubt the Minister of State will tell us, in particular, whether he feels that there are any parts of this Bill that need to be enhanced or strengthened following the discussions that I am sure he and the Home Secretary have had with the banking industry.

This matter has been dealt with today in a very constructive and co-operative manner. I hope that the Minister will make quite clear to the country;—indeed, to the world, because this is an international problem—the outcome of discussions with the banking industry, particularly the Bank of England, and what is happening with regard to the possible withdrawal of licences from banks that fail to co-operate or are found to be operating in the money-laundering business.

I shall now conclude, anticipating from the Minister of State an answer on this important issue of money laundering. Perhaps there are some sensitivities, but to the Opposition—in particular, I congratulate my hon. Friend the Member for Huddersfield on his excellent speech—it is such an important issue that something must be done to combat it. We believe that money laundering affects adversely the efforts not only of the British Government but also of other Governments to rid the world of the evil of drug-taking.

6.11 pm

The Minister of State, Home Office (Mr. John Patten):

I cannot recall ever having followed a winding-up speech as charming as the one that has just been made. I became extremely worried—the speech was highly persuasive. The hon. Member for Kingston upon Hull, West (Mr. Randall) reminded me very much of Shere Khan in "The Jungle Book". He seemed to be saying, "Trust in me, trust in me. Just give me the information. Just give me the answers."

Over recent years, I have watched the hon. Gentleman with respect, and I think that, like his hon. Friend the Member for Huddersfield (Mr. Sheerman), he really meant the support that, on behalf of the Opposition, he expressed for this Bill. My right hon. and learned Friend the Home Secretary and I both welcome the Opposition's support for the general purposes of the Bill, and I am sure that we shall have some interesting and important discussions in the Standing Committee.

I am sure that, just as we agree on the general principles of the Bill, we can agree also, in another rare moment of bipartisanship, how appalling it is that no Social and Liberal Democrat Member has been present during the debate. It is an utter disgrace.

Many hon. Members raised the question of international co-operation in dealing with banking problems in this context. If our international partners make no distinction between fiscal offences and other kinds of crime, it would not really make sense for us to impose such a distinction and to deny our international partners any help in connection with fiscal offences, while being willing to grant such help in all other cases. If we co-operate with other countries, if we give them the broadest possible support in dealing with offences against their laws, we can expect them to support us when we seek their help in dealing with crimes, within our jurisdiction or abroad, against our laws.

I know that a number of hon. Members, like the hon. Member for Huddersfield and my hon. Friends the Members for Wanstead and Woodford (Mr. Arbuthnot) and for Birmingham, Hall Green (Mr. Hargreaves), are very concerned about whether we should help to enforce other countries' tax laws and about how the Bill adds to what can be done already via double-taxation measures. The hon. Member for Huddersfield and others have voiced the fear that, in helping other countries in respect of fiscal and taxation matters, we might be inadvertently sending someone back to justice that falls below British standards.

The existing extensive network of double taxation treaties, which now includes all our European partners and nearly all other countries in Europe, already provides a mechanism for the exchange of information between tax authorities, but information obtained in this way may well not be admissible in court if someone is eventually prosecuted for a tax offence. This Bill provides a means of obtaining such evidence in a way that is much more likely to make it admissible. I do not see how anyone could reasonably object to filling so obvious a gap in our law. However, we shall pursue the point in Standing Committee if it is raised there.

The hon. Member for Huddersfield made a point about how what might be called a banana republic might make malicious use of a provision of this Bill against a British commercial interest or against a foreign national. That point is worthy of consideration, and it can be considered by the Standing Committee.

I shall not fall into the trap of debating Committee points at this stage, but I should like to draw the attention of the hon. Member for Huddersfield to clause 4(2), which provides very broad discretion as to whether we should be able to respond to requests from overseas. We shall be able to exercise this discretion in dealing with requests from other than European convention countries or from those to whom we have treaty obligations.

If we were to receive from another country a request about whose origins we had some doubt, or its bona fides, if we suspected that there was likely to be abuse of the judicial process in that country, it would be open to us to refuse to nominate a court to take the evidence requested. I think that that deals with the matter, and I hope that it will save time in Committee, when, I suspect, deliberations will get shorter and shorter as we begin to consider the relatively small number of problems posed by the Bill. By "problems" I mean the point raised by the hon. Member for Huddersfield and other matters, including the one raised by the hon. Member for Greenock and Port Glasgow (Dr. Godman), to which I shall turn in a moment.

The hon. Member for Huddersfield made a great show of being bipartisan, of saying that we were all in this together. However, he allowed the mask to slip, and was inclined to lash out from time to time. I think that, in particular, he was unfair to my right hon. Friend the Foreign and Commonwealth Secretary—especially in criticising my right hon. Friend's record in trying to deal with international co-operation and money laundering. It is a record of which the whole Government can be proud.

The hon. Gentleman was also very unfair to the Home Affairs Select Committee when he used that Committee's admirable report, which was published in November, as ammunition for his arguments about money laundering in this country.

Mr. Sheerman

Will the right hon. Gentleman give way?

Mr. Patten

If the hon. Gentleman allows me to develop the argument I shall, of course, give way. His fox was shot very quickly and splendidly by my hon. Friend the Member for Westminster, North (Sir J. Wheeler), who said that the money-laundering problems isolated in the Select Committee's report were founded not on a lack of co-operation between the banks themselves, or on a lack of co-operation between the banks and the investigative authorities, but on the very complexities of trying to track sums of money as they moved around the globe. My hon. Friend will no doubt correct me if I am wrong, but I think that I use his words more or less exactly.

In such circumstances, the problems lie in identifying the ultimate owner of the money. I do not believe that the hon. Member for Huddersfield was quite accurate in his use of the report of the Home Affairs Committee.

Mr. Sheerman

Will the Minister give way?

Mr. Patten

I thought that I had dealt adequately with the hon. Gentleman's arguments but he wants a second barrel.

Mr. Sheerman

The Minister knows that we are the Opposition and that, even in the most harmonious debate, it is incumbent on us to advance arguments in opposition. I argued that, as the Select Committee pointed out, £15 million seems very small when set against the sum of £1,800 million. That was not a criticism of the Select Committee; indeed, my hon. Friend the Member for Bassetlaw (Mr. Ashton), who is a member of the Select Committee, intervened in support of my argument. We are merely saying that the Bank of England, after consultation with the other banks, must be able to come up with a way of doing more, more quickly. That was our point, and we believe that that should be done soon.

Mr. Patten

The Bank of England can defend itself admirably, but the criticisms of the banking system made by the hon. Members for Huddersfield and for Kingston upon Hull, West were a little unfair in view of the considerable efforts that the banks are already making to deal with precisely that problem.

Mr. Randall

rose——

Mr. Patten

Let me just answer one point raised by the hon. Member for Huddersfield. My officials and those at the Treasury—I see that my hon. Friend the Economic Secretary to the Treasury is here—as well as officials from Customs and Excise and other departments, are in regular contact with the Bank of England on the subject of drug trafficking and money laundering. Let me give an example. The Bank of England has been part of the United Kingdom delegation to the financial action task force set up by the economic summit to consider fresh initiatives in the fight against drug trafficking. There is no question of the Bank of England not playing an active part.

I come now to——

Mr. Sheerman

Before the Minister does that——

Mr. Patten

In that case, I had better give way to the hon. Member for Kingston upon Hull, West, who rose some moments ago.

Mr. Sheerman

This concerns the specific point that the Minister was attempting to answer. Will he take away with him the transcript of the BBC's investigative programme? I know that he does not care much for the BBC, but will he show it to his right hon. and learned Friend the Home Secretary and discuss with him the serious allegation to the effect that the Government are not pushing the banking system far enough or fast enough? I should be much happier if he answered those serious allegations.

Mr. Patten

I can give the House the undertaking now that I shall look at any document that the hon. Member for Huddersfield chooses to send me, but he must not attribute to me views that I have never expressed publicly or privately about the BBC or any other broadcasting organisation. That is simply not fair of the hon. Gentleman.

Mr. Randall

Will the Minister give way?

Mr. Patten

Yes. Now the hon. Member for Kingston upon Hull, West gets his chance.

Mr. Randall

May I put the record straight? The Minister will find from the report of our debate that I made no criticism of the banks. At one time, I was in banking myself and I know banking reasonably well—at least in a specialised area. What I said was that the Opposition believed that the Government could be doing more to ease the banks in a certain direction. The Minister has not told us anything. He said that discussions had taken place, but he did not say what initiatives the Government had taken to ease the banks forward to co-operate internationally to solve the problem that he so eloquently described. We are waiting to hear.

Mr. Patten

Each time I give way to the hon. Gentleman, I learn more about his fascinating career. A couple of weeks ago, in a Standing Committee on Statutory Instruments, I learned that he spent his early days as an engineering apprentice. I now learn of his expertise in banking.

Mr. Lawrence

He changes his job often.

Mr. Patten

As my hon. and learned Friend says, the hon. Gentleman changes his job often; I dare say that he will do so shortly after the next general election.

Mr. Randall

Oh!

Mr. Patten

My right hon. and learned Friend's response to the Home Affairs Committee will, of course, include observations concerning the matters referred to by the hon. Member for Kingston upon Hull, West. He will not have to wait very long.

Mr. Randall

Why not now?

Mr. Patten

Because my right hon. and learned Friend is following the well-precedented conventions of the House, and replying properly and in the normal way to the Home Affairs Committee's recommendations. The hon. Member for Kingston upon Hull, West is getting into a terrible muddle: he referred to a number of detailed matters raised in the Home Affairs Committee's report and not to questions arising from the Bill.

My hon. Friend the Member for Warrington, South (Mr. Butler), on the other hand, did indeed refer to detailed questions raised by the Bill, and I thank him for his remarks. He was especially concerned about precursor chemicals, which are a tricky problem. The convention provides a mechanism whereby new chemicals can be added or other chemicals deleted or transferred from one table to another, and that is by resolution of the United Nations Commission on Narcotic Drugs.

I ask my hon. Friend to glance at clause 12, which provides a corresponding power for the schedule to the Bill to be amended so that we can introduce new precursor drugs rapidly should the need arise. I hope that hon. Members on both sides of the House will accept that rapid mechanism.

Mr. Butler

Why is it necessary, for the purposes of clause 12, to specify drugs?

Mr. Patten

Because there is a wide range of chemicals that can be used. New chemicals are being introduced all the time and it is necessary to have the power to place them on the list. Let us take the example of the chemicals that might be used in the manufacture of cocaine. Some of the chemicals needed are commonly used. Acetone, for example, can be used as a reagent and a solvent. Those chemicals have a wide licit—I hope that the Hansard reporter is listening—use in many manufacturing processes and therefore to include a general blanket definition would be to use a very big-bore gun.

Mr. Lawrence

My right hon. Friend should be aware that my hon. Friend the Member for Warrington, South (Mr. Butler) is not alone in suggesting that such a provision may not be unnecessary. There is already a requirement in the clause that we should know or suspect that the substance is to be used for unlawful production of a controlled drug. Add to that the fact that there is a whole list of chemicals, such as acetone, which will not necessarily be used for the manufacture of a drug and one cannot but ask what on earth is the point in having a scheduled list which may end up excluding rather than including the very chemicals that one seeks to catch. I do not expect my right hon. Friend to give an answer immediately, but will he consider the matter in due course?

Mr. Patten

I do not know whether my hon. and learned Friend the Member for Burton (Mr. Lawrence) wants to serve on the Standing Committee, but I suspect: that my hon. Friend the Member for Warrington, South has earned his ticket and that we shall have some debates on this in Committee.

The hon. Member for Huddersfield said that we were not doing enough at home or abroad. Let me give one example of what we are doing abroad. The United Kingdom is the fourth largest donor in the world to the United Nations fund for drug abuse control, and that is not a bad record. The total United Kingdom aid in the current financial year is more than £7 million, which includes £4 million that is to go to Colombia, where it will be very well used. The conference to be held in April under the chairmanship of my right hon. and learned Friend the Home Secretary will do a great deal to devlop the global approach to tackling the cocaine problem in south America in particular.

In criticising our efforts at home, the hon. Member for Huddersfield was unfair to overlook the considerable budgetary provision that we make annually to try to solve the drug problem. On education, for example, some £3 million has been provided for drug prevention campaigns, some £9 million has been spent in the last four years for education campaigns in schools and a substantial sum of between £3 million and £4 million has been provided for in-service teacher training to prevent drug abuse in schools. That is terribly important in persuading children to resist the offer of a drug.

There is also my right hon. and learned Friend the Home Secretary's drug prevention initiative, which is to be area-based. He has announced that it will happen in at least nine of our cities where the drug problem is particularly bad, beginning in 1990–91. The Department of Health has earmarked some £14.5 million for drug treatment services in the current year. That is a substantial and growing amount. When we tot up all those heads of expenditure alone, they come to about £30 million.

Mr. Sheerman

I know that the right hon. Gentleman is a geographer, not a mathematician, but could we have that figure expressed as a percentage of the £1,800 million which his officials reckon is made out of drugs at present in this country? I have not worked it out—I am not a mathematician either—but it sounds like a small percentage.

Mr. Patten

We all know that it is easy for people to talk about the need to spend public money. It is important to spend public money properly, and I suggest that all the money being spent by various Government Departments—I thought that we had the Opposition's support for that—is being exceptionally well spent.

The hon. Member for Huddersfield tried the Home Secretary's patience earlier by continually saying that he would bring forward new policies but never saying what they would be. Here he goes again, saying that he wants to spend more. Does he wish to give a pledge now? My hon. Friend the Economic Secretary is here with his little calculator. He would love to add such a pledge to previous Labour pledges. The trouble is that the Labour party will not say what they intend to do or how much they intend to spend.

Mr. Sheerman

rose——

Mr. Patten

I shall not give way to the hon. Gentleman again.

Sir John Wheeler

I intervene as I reflect on what my right hon. Friend has just said. Does he agree that the £18 billion referred to in the Home Affairs Select Committee report is the estimated amount of money which moves through the international banking system, which happens to be based here in London? Does he agree that it is not money that is identifiable in the sense that we can send vanloads of police to seize it tomorrow but money that is believed to move through the system because London happens to be the premier banking location in the world?

Mr. Patten

My hon. Friend is right. That is yet another example of how the hon. Member for Huddersfield simply misquoted the Home Affairs Select Committee report. The report is available in the Library of the House and the words are on the page.

Mr. Sheerman

On a point of order, Mr. Deputy Speaker. I reluctantly take issue with the Chairman of the Select Committee. He misleads the House—I am sure because he has a lapse of memory. The report says: The National Drugs Intelligence Co-ordinator estimated that there is at least £1,800 million"— not billion— derived from drug trafficking in the United Kingdom.

Mr. Deputy Speaker (Sir Paul Dean)

That is an intervention, not a point of order.

Mr. Patten

The hon. Member for Greenock and Port Glasgow (Dr. Godman) talked himself pretty satisfactorily on to the Standing Committee. He asked several detailed questions about Scottish provisions, the definition of a ship and whether British customs or other vessels in hot pursuit can board boats in international waters. I look forward to debating all those points in Standing Committee, but I should surely be out of order if I debated them in detail on Second Reading.

Dr. Godman

Will the Minister give way?

Mr. Patten

If the hon. Gentleman will forgive, I must make some progress. I have given way more than all those who have spoken put together.

I shall end my speech by referring to the speeches made by my hon. Friend the Member for Westminster, North and my hon. and learned Friend the Member for Burton. My hon. Friend the Member for Westminster, North was right when he urged us again and again that there must be no legalisation of any presently illegal drugs. We agree with him entirely. I congratulate him and his Committee on its excellent report, to which, as I said earlier, we shall reply as soon as possible.

I thank my right hon. and learned Friend the Member for Burton for his support for our tightening up of confiscation orders. I know that, with his wide experience at the criminal bar and sitting as a recorder, he recognises the need to tighten up the confiscation legislation. Perhaps we should have recognised it in earlier legislation. He also referred to the need for greater international co-operation.

I welcome the bipartisan approach of the Labour Front-Bench spokesmen and congratulate both the hon. Member for Huddersfield and the hon. Member for Kingston upon Hull, West on their excellent speeches. I look forward to the Committee stage. However, the point was made forcefully by my hon. Friend the Member for Westminster, North and my hon. and learned Friend the Member for Burton that we are debating an issue which affects all our children—the fight against drugs.

Time after time, my right hon. and learned Friend the Home Secretary rose to press the hon. Member for Huddersfield, who was making generalised statements about future Labour policy, to give greater detail. Understandably, the hon. Gentleman could not give an answer. I do not criticise him for that, because the person who should have been here this afternoon to debate this extremely important issue is the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley). There is nothing more vital for our children's future than prevention of drug abuse. Where was the self-styled shadow Home Secretary? He was not here this afternoon.

The only thought-provoking remark made by any Opposition Member about how a Labour party policy might develop in future was made by the hon. Member for Bassetlaw (Mr. Ashton), who is no longer in his place. He has been described in my hearing as a thinking man's Roy Hattersley. He at least came up with a positive suggestion, which was grasped with both hands by the hon. Member for Huddersfield as the nearest thing to a proper Labour policy on drug abuse that he could find. He then compounded his failure by intervening—which I thought was impertinent—in the speech by my hon. Friend the Member for Westminster, North to say that the right hon. Member for Sparkbrook had more important things to do than attend the debate this afternoon, because he was deputy leader of the Labour party. The right hon. Gentleman was putting his political duties before his duties to the House.

Labour Members bellow brazenly with criticism, but they are shy of telling us their policies. I shall do my best during the Standing Committee proceedings, if the Bill receives a Second Reading, to tease out those policies. We shall return to Labour's policies——

Mr. Lawrence

And how much they cost.

Mr. Patten

As my hon. and learned Friend says, and how much they cost. Having said that, I thank the Labour Front Bench spokesmen for supporting the Bill and I sit down in the sure and certain knowledge that they will not force it to a Division.

Question put and agreed to.

Bill read a Second time, and committed to a Standing Committee pursuant to Standing Order No. 61 (Committal of Bills).