§ 3.10 p.m.
§ Lord Glenarthur
My Lords, I beg to move that this Bill be now read a second time. The scourge of drugs misuse, inflicting, as it does, incalculable misery and a tragic waste of young lives, is one of the most serious problems facing our society. That it is a matter of deep concern to all Members of your Lordships' House has been amply demonstrated may times. It is not however a problem which lends itself to quick and simple solutions. If a real impact is to be 91 made, it demands sustained action on many fronts. The Government have developed a coherent and comprehensive strategy for the fight against drugs, at home and abroad. We are actively promoting international efforts to combat production and supply; we have tightened controls on drugs manufactured or prescribed in this country. We have greatly strengthened the capacity of the police and Customs drugs squads with encouraging results. Recent figures show that last year Customs alone made 1,500 arrests and smashed more than 70 drugs rings, and the police, too, are enjoying increasing success. On the demand side, we have launched a major education campaign aimed at young people and their parents—early research indicates that the campaign has hit home very effectively—and provided substantial new funding to improve and expand treatment and rehabilitation centres for drug misusers.
It is against that background of wide-ranging action that the Bill before us must be viewed. It does not pretend to provide the complete answer to the problem; rather, it is another weapon in our armoury, and a particularly vital one. People are drawn into the drugs trade by the prospect of huge profits. By allowing the courts to confiscate the proceeds of drug trafficking, to ensure that traffickers come out of prison with no part of their ill-gotten gains left to compensate them for their years inside, the Bill will give the traffickers real cause for thought and hit them where it hurts. They will have to reassess the risks, and ask themselves whether the game is any longer worth the candle. And just as important, the confiscated money—money which might otherwise have been used to finance other, bigger deals by the trafficker or his associates—will be taken right away from the drugs trade. By making the drugs trade much less financially attractive, and breaking the cycle whereby the proceeds of one offence can be used to finance others, the Bill will, we hope, have a double impact on the problem of drug misuse.
The Bill was warmly endorsed by all shades of opinion in another place, not uncritically however. Indeed, a number of strengthening improvements were made to the Bill during its passage. Your Lordships will, I know, want to give the detailed provisions equally careful consideration. For their part, the Government will be willing to look at any refinements that your Lordships might wish to suggest. What is important is that we should have a just but effective way of attacking the profits made from increasingly sophisticated and well organised trafficking operations.
To set out the background for today's debate, I should like to show how some of the novel elements in the Bill will contribute to our aim. I want to mention also the careful system of safeguards which has been devised to ensure that, although the provisions must hit the traffickers hard, they will not threaten the rights or welfare of innocent people—indeed, quite the reverse.
The central feature is the new concept of a confiscation order, which is set out in Clauses 1 to 6. Unlike powers of forfeiture, which operate only to deprive the offender of specific property which can be directly linked in some way to his offence, a 92 confiscation order will make the whole of the offender's property liable to confiscation, up to the full value of the proceeds from his illegal activities. The Crown Court will be required by Clause 1 to impose on anyone convicted of a drug trafficking offence a confiscation order to deprive him not simply of his proceeds from that offence, but from his entire trafficking career, in so far as the court is able to determine them in accordance with the provisions of the Bill. This will be in addition to whatever sentence is considered appropriate for the offence. To help the court assess the proceeds of drug trafficking—which will obviously be a far from simple matter in some cases—Clause 2 allows certain assumptions to be made. These are that, except to the extent that the offender can show otherwise, all his property and everything that has passed through his hands in the previous six years represents the proceeds of drug trafficking.
These provisions contain a number of novel features, and perhaps I can deal with some important points in a little more detail. First, I should emphasise that there is no question of reversing the burden of proof as regards conviction. The burden will remain on the prosecution, in the usual way, to prove beyond reasonable doubt that the defendant is guilty of the offence of which he is charged. Once a person has been convicted of a drug trafficking offence, however, the onus may be placed on him to show which, if any, of his assets were legitimately acquired. If we are really serious about recovering the proceeds of drug trafficking such a provision is essential. It may never be possible for the prosecution to establish with certainty how much of a wealthy trafficker's lifestyle was financed by his criminal activities. To insist on it doing so would inevitably mean that many convicted traffickers would be able to retain most of their illegal gains. Such information is, however, very clearly within the knowledge of the offender, and where he has had some legitimate income it ought not to be too difficult for him to estalish that to the satisfaction of the court.
Second, it would be an obvious loophole if a trafficker were able to avoid the full effects of confiscation himself by putting his assets in the names of his family or friends. We are therefore providing that any property which has been transferred by the offender to a third party for significantly less than full value should also be liable to confiscation, provided that the transfer took place within the previous six years, or the property concerned can be shown to represent the proceeds of drug trafficking.
Concern has been expressed in some quarters that these provisions could have the effect of penalising innocent third parties who acquire property in good faith from a person whom they did not know to be a drug trafficker. The Government are anxious to protect the legitimate interests of such people, and perhaps this is the moment for me to pick out various provisions which have been included in the Bill specifically to that end. First, any payment made for the property will have to be significantly below its true value for these third party provisions to bite; there is no question of confiscating property where the difference in value is slight. Secondly, Clause 13 provides that the High Court must seek to ensure that 93 any third party who has given some consideration for property which subsequently has to be confiscated is able to retain or recover that consideration.
A further safeguard, contained in Clause 11, is that persons holding any interest in property which is liable to confiscation must be given a reasonable opportunity to make representations to the court before that property can be realised. And, finally, I should point out that the Bill gives the High Court considerable flexibility in exercising its powers to enforce a confiscation order. The court could therefore, if it felt it appropriate, direct that all of the offender's assets, including legitimate ones, should be realised before any action was taken against property in the hands of third parties.
The enforcement provisions of the Bill are set out in Clauses 11 to 13. Enforcement is entrusted to the High Court to make use of its considerable experience in dealing with questions of property. If necessary, a receiver can be appointed to realise any of the offender's assets to satisfy the confiscation order in full. This means that if an offender has spent the proceeds of his trafficking, or salted them away outside the jurisdiction, legitimately acquired assets may be seized instead. If he has placed assets beyond the reach of the courts, and refuses to make them available, then there will be substantially increased periods of imprisonment to be served in default, up to a maximum of 10 years where very large sums are involved. But if, by any chance, the offender should be unable to satisfy the confiscation order through no fault of his own—perhaps because his property failed to realise the amount expected—it would clearly be wrong that he should have to serve a substantial default term regardless. In Clause 14 therefore there is a procedure for him to seek a variation in the amount to be paid under the order in such circumstances.
The new confiscation powers are at the very heart of the Bill. But, by themselves, they will not be enough. They will serve little purpose if nobody knows where the proceeds obtained from drug trafficking are. Accordingly, the Bill provides important powers to assist the police and Customs in tracing those proceeds, and for the courts to freeze them until the defendant has been tried. Although the tracing powers are set out towards the end of the Bill, it may be convenient for your Lordships if I deal with them before the question of restraint, as, in practice, investigation will precede restraint in individual cases.
If we are to crack these complex trafficking operations, and trace the proceeds, it is essential to obtain access at an early stage to information held by banks and other institutions about a suspect's financial affairs. Clauses 20 to 22 of the Bill provide powers for the police or Customs to obtain an order or warrant requiring the disclosure of such information. But this new power, too, is balanced by careful safeguards. An order or warrant can only be granted by a circuit judge, who will have to be satisfied that there are reasonable grounds for suspecting that the person under investigation has engaged in or benefited from drug trafficking; that the information sought is likely to be of substantial value to the investigation; and that it is in the public interest that the information should be disclosed.
94 Having traced the assets which are believed to be the proceeds of drug trafficking, it is equally important to ensure that these proceeds are not disposed of before the end of the trial. Here again, we propose to make use of existing expertise in the High Court by developing procedures already well established in civil law.
Clause 8 of the Bill enables the High Court to make a restraint order—similar to a civil Mareva injunction—preventing the transfer or disposal of assets which may be required to satisfy a confiscation order. Once again, the exercise of the power is subject to stringent conditions which are outlined in Clause 7. The purposes of Clauses 9 and 10, as with restraint orders, is to ensure that money is available at the end of the trial to satisfy any confiscation order imposed.
Before I leave the framework of restraint and confiscation orders, I should perhaps draw attention to Clause 15, which provides for the payment of compensation in certain circumstances if substantial losses have been suffered as a result of a restraint order or charging order, or the realisation of property.
The Bill contains two important new offences. The new offence set out in Clause 17, and termed "assisting a trafficker to retain the benefit of drug trafficking", is designed to catch those who help the trafficker and benefit from his crimes by "laundering" the proceeds. We regard this as a very serious offence and are therefore providing that on conviction on indictment an offender should be liable to up to 14 years' imprisonment. And since the offence comes within the Bill's definition of drug trafficking those convicted will be subject to its confiscation procedures.
Clause 24 makes it an offence to rejudice a drug trafficking investigation by "tipping off- the suspect after an order or warrant requiring the disclosure of information has been made or applied for.
The Drug Trafficking Offences Bill applies only to England and Wales in general but I should perhaps say something about enforcement elsewhere in the United Kingdom. My right honourable friend the Secretary of State for Scotland has announced that he intends to introduce equivalent legislation in Scotland at the earliest opportunity. Until then provision has to be made in the present Bill, in Clause 16, to ensure that confiscation orders imposed by courts in England and Wales can be enforced against assets held in Scotland. New clauses are being prepared specifying in some detail the procedures by which the Bill will be enforced in Scotland. I hope we shall be in a position to put these amendments before your Lordships at Committee.
It is aimed to extend the Bill to Northern Ireland by Order-in-Council with appropriate modifications.
Finally, to complete the domestic picture, we are advised by the lieutenant-governors of Guernsey, Jersey and the Isle of Man that those islands too are proposing to introduce legislation to provide for confiscation of the proceeds of drug trafficking, and of course we shall be seeking suitable arrangements for mutual enforcement.
As we discussed last Wednesday, drug trafficking is an international menace and international cooperation is vital to ensure that there can be no safe havens for the trafficker or his assets. I indicated then 95 that the Government have given strong support to proposals for a new United Nations Convention covering all aspects of international drug trafficking, and we have provided a framework in the present Bill in Clause 19 for giving effect to mutual enforcement agreements with other countries. We shall be seeking such arrangements with as many other countries as possible, either in the form of bilateral agreements or by acceding to multilateral conventions.
Before I sit down I should perhaps touch briefly on one other matter which the Bill does not at present address. Reports have come to light within the last few weeks about the sale of cocaine sniffing kits in London and elsewhere. We have been looking urgently at the adequacy of existing law in this area, and it appears that at present there is no means of preventing the sale of such kits. We are therefore proposing, if it is acceptable to your Lordships, to bring forward at Committee provisions creating a new specific offence of supplying or offering to supply a combination of articles which, taken together, the seller knows or believes are likely to be used for the administration of a controlled drug, other than for bona fide medical purposes. I believe your Lordships will agree with me that the open sale of kits which are designed to facilitate illicit drug taking is an intolerable affront to which we must respond immediately and decisively.
The unusual degree of both novelty and complexity which is to be found in our proposals has needed considerable explanation. The Bill has nevertheless commanded almost universal support. Truly effective action is essential if we are to cope with the terrible menace of drugs. This Bill is an essential part of our overall strategy on drugs. If we can get at the enormous profits made by drug traffickers we shall remove the major incentive which draws people into this evil trade. The proposals in the Bill are designed to address every stage in the investigation and prosecution of an alleged trafficker, from the examination of the suspect's financial affairs at the outset of the investigation to the realisation of the convicted offender's assets by the High Court. At every stage not only have we provided powers which are strong enough to bite really hard, but we have also introduced careful safeguards to prevent their abuse and to protect the rights of suspects and third parties alike.
This Bill will provide a major advance in the powers of the police, the Customs and the courts to deal effectively with trafficking and the trafficker. We can leave no stone unturned in our efforts to bring to an end the tragedy and the misery which the brokers of this vile trade encourage. They deserve the full rigour of modern effective legislation. They must be harried, brought to book, and sternly punished and not see a penny of their wretched gains. This Bill can only help. My Lords, I beg to move.
§ Moved, That the Bill be now read a second time.—(Lord Glenarthur.)
§ 3.27 p.m.
§ Lord Mishcon
My Lords, this House is dealing, not for the first time, with one of the greatest curses of our generation. I could not have put in better words a description of what we are dealing with than did the noble Lord the Minister in his peroration just now. It 96 was in this very House that some time ago we heard the Lord Chief Justice, in a speech in which he spoke of what was being done to our young people, say how many of the accused appearing in our criminal courts had the origins of their downfall in the taking of drugs and how, if Parliament was to do its duty, legislation ought to be passed with regard to these ill-gotten gains which some of the most cowardly and wretched criminals in the world have gotten unto themselves by virtue of this diabolical trade.
We have done various things in Parliament. We have increased the term of imprisonment to one of life for the big dealers—the ones at whom we are trying to get. We have done what we could from these Benches. May I assure the noble Lord the Minister that he has every conceivable support from the official Opposition for all the work that is being done by his very much esteemed colleague, Mr. David Mellor, in this connection. There is no lack of support as I have said.
We have tried to increase it by pressures from various parts of the House. It has not been difficult to administer the pressure and it has been difficult to withstand the pressure, because the Government have in fact increased the number of Customs officers and the number of police officers—whether that is sufficient or not is a matter for debate but steps have been taken in the right direction. Moreover, it is quite obvious that before we ever reach this stage of the legislation we shall of course have to have sufficient knowledgeable and specialised people who can catch the criminals before any of the provisions of this Act take effect. We have done that, and in this Bill we are now endeavouring to see that such ill-gotten gains are confiscated.
Having expressed that complete support, may I from these benches—but I believe it is echoed from every corner of your Lordships' House—pay a tribute to a lady who has featured in today's press. I refer to the Princess of Wales. I read in this morning's Daily Express:Diana delights drug addicts—When Princess Diana met Debbie … yesterday"—I am not going to use the surname even though the paper does—the young mothers who crowded round were not talking about their children—but killer drug addiction. And 24-year-old Debbie, who was spending £160 a day on heroin before being admitted to hospital said: 'I think she is doing a marvellous job getting involved with the drugs problem'.It has been said often in this House and elsewhere how fortunate we are in the members of our Royal Family, and this young princess who is interesting herself in this problem and so actively endeavouring to help deserves our thanks and congratulations.
§ Lord Mishcon
My Lords, I move on to the actual provisions of the Bill, with the general principles of which I believe there is unanimity in this House. If I may, and I do it quite humbly, I shall merely sound a word of warning—not in regard to the very special powers taken in this Bill, but against them being carelessly used as a precedent. I say that for good reason. In my judgment this Bill properly does not shift the burden of proof in regard to guilt or innocence, but once guilt is proved it shifts the onus to 97 the person who has been convicted of the offence. The burden shifts to him to prove that his assets do not derive from drug trafficking.
I say that it is a right shift of onus in this particular case. However, it must not be used as a precedent without the greatest care. I observed that at Second Reading in another place there were some alarm bells being sounded, but I must confess that I did not like some of the sounds of the bells that were ringing. When the Secretary of State was introducing this measure in another place, he said:The 1984 report of the Howard League committee, chaired by Mr. Justice Hodgson, to which we are indebted for many of the ideas in the Bill, made recommendations—most of which it believed should be generally applied. As a Government, we are committed to the idea of attacking the profits of crime in a way that goes beyond drugs offences, and we shall have to return to the subject. We have, however, judged it best to deal with drugs offences and other offences separately. Perhaps they should also be dealt with differently, but that is a matter for another day. In any case, the Bill has been prepared solely as a basis for dealing with drug traffickers and it should be judged in that light. The Government will want to pause and reconsider before seeking to extend any of the Bill's provisions to other offences".—[Official Report, Commons: 21/1/86; col. 242.]That statement rang a bell in my mind and, as I said, I was not quite sure of the tune that it was sounding. All I want to do, if I may, and then I shall pass on, is to say that this is a bell to which your Lordships should listen very carefully if it seems to provide a precedent for any other Bill dealing with criminal law which comes before your Lordships.
I say that because it is extremely easy to misunderstand the recommendation of the Hodgson Committee which was in fact set up at the instance of the Howard League for Penal Reform, which is not an organisation known for being harsh toward criminals but one which endeavours to see to it that justice is performed in the treatment of criminals. As I understood it, what Mr. Justice Hodgson was saying was that because of the fact that our prisons are so full and because of the need to offer alternative penalties other than incarceration, if that is possible, many occasions may arise in the courts when confiscation or making monetary amends for what has been done should in fact be available to the courts, and this should be the kind of penalty that in some cases should be exacted.
This Bill was not meant to open a door to the confiscation of property, where onus would be thrown upon a defendant to show that his assets did not in fact originate in crimes which he had committed either then or, if I may say so, within the previous six years.
I should like now to pass rapidly to the other provisions of the Bill.
§ Lord Harmar-Nicholls
My Lords, perhaps the noble Lord will forgive me for interrupting, but it is very important. I do so agree with the noble Lord, but I was not quite sure of the message that he was implying came from this bell that alerted him. In quoting the Minister's speech in another place, did he think that there was a risk that he might retreat from it or was he not going far enough? I did not quite understand the indication that the noble Lord was giving to your Lordships.
§ Lord Mishcon
My Lords, I am much obliged to the noble Lord, Lord Harmar-Nicholls, for pointing out to me that I may not have been entirely clear in the message that I was trying to give to the House. This message was that the Secretary of State, in presenting this Bill in another place talked in terms of the possible generalising in our criminal law of the particular penalty and shift of onus which are incorporated in this Bill. I was saying that I give it the fullest support in this Bill for drugs traffickers but I am wary about copying that precedent in other criminal cases.
There is another provision in this Bill to which the noble Lord, the Minister, referred—and here I am not trying to protect any drug traffickers; I am thinking of innocent third parties. The Minister said that where a convicted drug trafficker had parted with his property at less than the proper market price, there was a provision in the Bill which enabled that property still to be confiscated. Unfortunately, he did not quote the provision in the Bill—I believe it is Clause 5—and he used the words "substantially less'. The Bill does not use the words "substantially less". I turn rapidly to Clause 5 of the Bill where, at the top of page 6, it says—and this gives the power to confiscate:(b) the property has been held by him at any time since the beginning of the period of six years ending when the proceedings were instituted against him and has been transferred by him for less than full value".The noble Lord the Minister may have used an equivalent word to the word "substantially".
§ Lord Mishcon
My Lords, I am most grateful. It just shows what my scribble is like; I read "substantially", having scribbled down "significantly". The word "significantly" does not occur in the Bill. I mention this because again it was a point mentioned in the other place by, I believe, someone on the Government Benches, who said how dreadful it would be if a drug trafficker, thinking that he was likely to be caught or wanting to get out of the kingdom as fast as he could, told an estate agent to sell his house as quickly as possible for whatever price even if it were below the market value, and someone in good faith immediately purchased the house for that figure. It appears that in those circumstances confiscation should take place without there being any provision at all for compensation for the innocent third party.
I know what the Bill means, but at the moment it does not say it and the word "significantly" does not occur. However, perhaps that is a point for the Committee stage. Sometimes at Second Reading it is fair to give the Government notice of some of the points one intends to raise, and with his customary generosity the Minister might come forward with an amendment of his own and save everyone a great deal of time.
When one supports a Bill I do not think it is appropriate to deliver long speeches. The only time one should do that is when one opposes a Bill. As I want so earnestly to support this Bill, I propose to close my remarks and congratulate the Government on following the lead of the Lord Chief Justice and many others and introducing this measure, which I think is very appropriate.