HL Deb 13 March 1996 vol 570 cc886-917

5.36 p.m.

Lord Campbell of Croy

rose to call attention to the change in status of the intelligence and security services, to the nature of the functions now appropriate for them and to the need for public acceptance of their roles in the 1990s; and to move for Papers.

The noble Lord said: My Lords, I should make clear the intended scope of the debate. By the "intelligence and security services", I mean the three organisations which have, in the past six years, all been placed on a statutory basis; namely, MI5, MI6 and GCHQ.

I take them in turn. First, MI5, known as the Security Service, has worked mainly on counter-espionage, mostly within the United Kingdom. MI6 is the Secret Intelligence Service—SIS—which British governments did not even acknowledge as existing until a few years ago. The Act which placed it on a statutory basis was passed in 1994. GCHQ, which was made statutory in the same Act, also has the task of obtaining intelligence, the letters standing for Government Communications Headquarters.

It may be asked what were the origins of the designations, MI5 and MI6. In their infancy, before or during World War One, the two organisations were allotted spare numbers of military intelligence sections in what was then the War Office. Military intelligence sections 1 to 4 already existed, the numbers denoting different areas of the world. It was a simple and convenient way of providing identifiable labels. Those labels served conveniently for many years.

I am extremely glad that the speakers in this debate know a great deal about the subject. I look forward to hearing their views on situations in the world today. My noble and learned friend Lord Howe of Aberavon, besides having been a distinguished Foreign Secretary, is the Member of the House of Lords on the new Parliamentary Intelligence and Security Committee which has been in existence for only a few months.

I have never been a member of any of the three organisations. However, I worked closely with them for a period when my job in the Foreign Office consisted of continuous liaison with them. I was authorised to mention that publicly two years ago at the time of the Second Reading of the Bill which became the 1994 Act. That experience of mine was a very long time ago. It took place well before I retired from the Diplomatic Service and entered Parliament in the other place 37 years ago.

The changes in status of the three organisations have been taking place at the same time as the ending of the Cold War and the disintegration of the former Soviet Union. The timing has been helpful but dangerous situations remain in the world. I shall expand on that shortly.

In the legislation passed since 1989, the Government and Parliament have felt able to move to a remarkable degree of openness while remaining confident that secrecy can be preserved where it is essential for work and operations. The United Kingdom now has a regime covering all three organisations. It includes special commissioners, a parliamentary supervisory committee, which I mentioned, reporting to the Prime Minister, and complaints procedures. In supporting those innovations, I have always stressed the imperative requirement to protect the sources of intelligence, and especially the agents who often operate in dangerous places. A balance has to be struck and I hope that we have achieved it safely.

As regards openness in Parliament, everything recorded in Hansard is available to every hostile or terrorist regime in the world. I remember at least one incident, a great many years ago, when a Minister gave a reply in Parliament off the cuff, forgetting that the information had come from a secret source. Within a matter of days the source closed down. That is a powerful reason for the special parliamentary committee, established by the 1994 Act, to deal with matters connected with the secret services.

The end of the Cold War was a blessing for mankind. The world is no longer menaced by a division between two hostile armouries owned by the most powerful nations. Having myself, first in diplomacy and then in Parliament, worked in a small way to that ending—and now having seen it happen, although much more quickly than expected in the later stages—I give thanks for it as I am sure do other noble Lords. Nonetheless, great dangers remain and also great nuisances.

The dangers include the possible possession by intemperate and irresponsible rulers of even small countries of weapons of mass destruction; for example, biological and chemical weapons. I have pointed to that particular danger on two or three occasions in this House within recent months and given the examples of Idi Amin and Saddam Hussein. The dangers also include the fanaticism, sometimes religious, which resorts to terrorism. Only recently we have unfortunately seen renewed outbreaks in the Middle East and even here in the United Kingdom. Good intelligence can help to identify individuals, ringleaders, and also, very importantly, sources of funds.

As for international nuisances, there is drug trafficking, serious organised crime, which can wreck many lives, and money laundering, which is an integral part of the concealment of the illicit gains from such criminality. The intelligence and security agencies are needed to provide the earliest warning, together with continuing information, and to detect the manufacture and transport of materials for bombs or other lethal weapons intended for terrorism or aggressive warfare.

The world remains dangerous also because of the outbreak of small wars and the tense situations which can lead to outbreaks. Some are civil wars which are difficult for the United Nations or other countries to settle or reduce. The United Nations Charter in Article 2, paragraph 7, specifically prohibits intervention in the domestic affairs of a state. So peacekeeping was subsequently adopted as a new concept with procedures which were not in the Charter. Peacekeeping operations have been launched in various parts of the world with mixed receptions and, usually, unpredicted results. Here again, early intelligence reports can be of great value in anticipating troubles.

Parts of Europe and Asia are still unstable as a result of the Soviet Union dividing up into republics and the internal conflicts in the former Yugoslavia. The shock waves have left disputes, and nationalist movements disposed to use violence. We must be ready, too, for ethnic and religious disturbances elsewhere which could lead to serious armed conflicts.

The intelligence services now have a wider role, if they are to monitor events in various parts of the world and give warnings, than their previous main task of scanning the Soviet empire so far as that was possible. Another role of our intelligence agencies which has been extended is confidential collaboration with other countries. In order to defeat international terrorism and organised international crime, especially the traffic in drugs and bombs, we should now be able to co-operate with those countries which a few years ago were hostile, potential enemies. I have the new Russia in mind. Our system should now be refined in a way that enables us to exchange certain information with the Russians without prejudicing delicate sources. In a debate a few years ago on the subject, at the time when Mr. Gorbachev was presiding over major changes in the Soviet Union, I expressed the hope that we would in due course reach that degree of co-operation to the detriment and downfall of international criminals.

Russia has its internal problems and admits to the development of a Russian mafia with tentacles spread as far as the United States. The West should be able to help and co-operate in detecting and forestalling illegal, stealthy transactions which bring misery to many thousands of people. Our intelligence agencies have long co-operated with those of our chief allies. The efficiency of their secrecy and security is essential. They must also have confidence in ours—an important consideration when the extent of openness is being decided.

It is providential that my luck in the ballot produced this debate today. As I understand it, in a few weeks' time, after Easter, the House will have the Second Reading of the Security Service Bill which has now arrived from the other place. We shall have time in that debate and during the later stages of the Bill to consider in some detail the Government's proposals that the Security Service should contribute its expertise to helping the law enforcement agencies, in particular the police, to counter organised crime in this country. That will be an additional function of the Security Service. Much will depend in practice on relations and co-ordination with the police who have the task of collecting evidence to warrant prosecution leading to conviction. That is not a function of the Security Service.

Most of the work of MI6 has to remain concealed for obvious reasons. The British public have been presented with a highly entertaining version in the fictional adventures and antics of James Bond. In his case, he is both a secret service officer and an agent which makes it more exciting. In real life the British member of the secret service does a duller, meticulous job which, nonetheless, needs flair and initiative. He or she is in touch with systems or agents who often depend crucially upon that officer's judgment and wisdom.

My assessment of the three services when I worked with them a long time ago, and later when I benefited from the products of their labours and enterprise, was that their members worked diligently and successfully out of the public eye and with their achievements unknown and unrecognised. It is a form of dedication to the service of our country deserving the highest commendation.

Before I leave the subject of MI6 and 007, I should mention one factor common to Fleming's fiction and real life. During the period when I was working with MI6 I could not fail to notice, as a footnote, that the young women working there were strikingly beautiful, as in the films. I should add that the "Moneypenny" of that time—older, of course, and more senior—was just as charming as the fictitious one, with a lively sense of humour. The new Official Secrets Act allows me to divulge that superficial information. I am not sure what the position would have been under the old Official Secrets Act. No one was sure about anything under the all-embracing section in that Act. That was the main reason for replacing it, which the Government sensibly did a few years ago—to the Government's credit—as another extension of openness.

The three organisations are now in the public eye and the reasons for their existence have been openly stated. Their purposes and general roles should be made clear in a way that can easily be appreciated by members of the public. If trouble is not taken to do this, commentators in the media must be expected to be critical, and the public could become suspicious, for example, of apparently unproductive expenditure which in the past was invisible within a secret vote. There could also be complaints about alleged intrusions by the Security Service into the daily lives of citizens.

I look forward to the speech of my noble friend Lord Chesham from the Government Front Bench. Because discretion is needed in addressing these subjects, I have not put any particular questions to him. I hope he will simply comment on progress in the areas I have mentioned, choosing what he feels free to discuss. This is because it is so important to protect sources of intelligence, some of which have taken many years to establish. I beg to move for Papers.

5.52 p.m.

Lord Kennet

My Lords, the noble Lord has surely earned the gratitude of the House for this timely debate before we discuss the Security Service Bill, to which he referred. He mentioned the pleasure he gained from the James Bond stories. That reminded me of the book about the British Secret Service which I most enjoyed reading. It was an Italian book. The frontispiece carried the caption, The headquarters of the British Secret Service", and comprised a picture of No. 10 Downing Street, seen through the Foreign Office arch. The text opened with a description of the training of British secret agents: it was apparently confined to learning how to use invisible inks and how to jump off battlements at a castle in Devonshire, near London. The pleasant absurdity of that was possible because of the extreme secrecy of the Secret Service in those days. That is something which we have long since forfeited.

Because of the intense and multiple collaboration of our services since 1943 with the American services, I wish to draw attention to what is going on now in Washington. A great deal is going on, partly as a result of the Ames scandal. The CIA traitor Ames and his associates managed over the years to foist greatly exaggerated figures for Soviet military capabilities on a succession of Presidents, and thus on American allies too, including us. The National Reconnaissance Office, which is part of the huge panoply of American quasi-secret organisations, recently built itself a mammoth office block, which it should not have done, and which no one noticed. In addition it managed to hide 2 billion dollars of federal funds in a bank account of its own. President Clinton has now taken back 800 million dollars of that, and will use it for the Bosnia operation. I do not know what will happen to the rest.

As a result of those and other irregularities, there has been a great wave of inquiry and self-examination in Washington, as one may well imagine. There are at least four exercises going on which are designed to reform and regroup the entire scene. The extent to which each of these exercises is aware of the work of the others, or is collaborating with them, is quite unclear from outside, but that is nothing new on the Washington scene. Given the historically close links which we have with these services in Washington, this present mood there must affect us and our people quite intimately.

First, there is the Perry-Deutch arrangement, whereby a new National Mapping and Imaging Agency would take over everything. The Pentagon and the Director of the CIA—that is, Messrs. Perry and Deutch respectively—would run it. This is supposed to be up and running in October. Secondly, there is the President's own study—of organisation, we take it—done by a commission chaired by a former Defense Secretary, Mr. Harold Brown. That has already reported. Thirdly, there is another report which has been carried out by the House Intelligence Committee Chairman, Mr. Larry Combest. Fourthly, there is the study being done for Senator Arlen Specter, Chairman of the Senate Intelligence Committee, which is due to come out in April.

Both the second and third items in that list propose that the United States should co-develop "less critical" satellites with the United Kingdom, France and Germany. That means that we would be expected to co-fund. That expectation, in American eyes, is well justified because we obviously cannot build anything like Battlestar Galactica ourselves. Nevertheless we are assumed to want the fruits of Battlestar Galactica when they come about. Battlestar Galactica is the latest catch-name for the panoply of sensors and weapons controllers which the Americans are likely to put into space. Besides our own, and French and German, collaboration with that, Israeli collaboration is already far advanced.

Now, from last July, the CIA has been under presidential orders to conduct economic espionage on America's trade rivals as a top priority. I am not sure how well appreciated this fact is yet in Britain; it is certainly well appreciated in France and Japan, where they have had fairly scandalous experience of it. So it is a complicated scene. On the one hand we have to try to continue our collaboration with a ceaselessly shifting, amalgamating and repartitioning organisation there, but on the other hand we have to live with the fact that part of it is under orders to spy on us.

I imagine that all departments of state are thinking carefully about that latter fact—they should be—as, no doubt, are all British political parties. One thing is certain, and that is that the old British contribution to the Washington intelligence scene—which was to act as arbiters in disputes on interpretation between the competing American bodies—is over. How far all this is from the old simplicities when a secret service was really secret, and was indeed so secret that it was legitimate to doubt its very existence! Into this fog of manoeuvre, duplication and confusion our own services will have to fit as best they can, without ever compromising their still undoubtedly superior secrecy. We should all wish them good fortune in the job.

5.59 p.m.

Lord Chalfont

My Lords, I should dike to follow the noble Lord, Lord Kennet, in expressing my gratitude to the noble Lord, Lord Campbell of Croy, for giving us the opportunity for a brief debate on this wide and important subject. I shall not follow the noble Lord, Lord Kennet, any further down the road of the American intelligence services, although the subject would make an interesting debate on its own. I should like to concentrate instead on one aspect of the Motion in the name of the noble Lord, Lord Campbell—namely, on the intelligence services.

First, I want to offer a thought on the aspect of the Motion relating to the nature of the functions now appropriate for the intelligence services. My initial premise is that there is not much change in the nature of the functions which are appropriate for our intelligence services, except that perhaps they now have a much heavier responsibility even than they had in the depths of the Cold War.

In military intelligence there is an axiom that the fewer troops one has on one's own side the more powerful must be one's system of intelligence. That has a much wider application. It has an application to our national security. As we have in this country, as a result of the apparent end of the Cold War, proceeded to diminish the strength of our Armed Forces and their equipment, we need to have even more effective and powerful intelligence services than we had when we had larger Armed Forces.

In the trade of intelligence there are two words which often govern the way a service operates. Those two words are "capabilities" and "intentions". We need to know what a potential enemy is capable of doing. In other words, we need to know about his armed forces, his military infrastructure and his entire economic resource capable of conducting and supporting a military operation: namely, his capabilities for conducting military operations. We also need to know an enemy's intentions. We need to know how he plans to use those capabilities.

Therefore, first, we need accurate information about the capabilities of a potential enemy. We need to know as precisely as possible what he has at his disposal. Sometimes, if we have thoughtful and imaginative intelligence systems, we can judge from the capabilities what the intentions might be. One can often tell from how a country deploys or equips its armed forces how it intends to use them.

That is not enough. We also need to know more about the intentions of an enemy. One cannot find that out through the use of satellites and modern technology, however sophisticated it may be. One needs always to have what is known in the jargon as Humint (human intelligence)—the spies and agents of the world of 007, who are sometimes nowadays regarded with a certain amount of irony but who are still extremely important elements in a nation's intelligence capability.

It would be fair to ask—and people will ask—whose capabilities and intentions we are talking about. We hear people say that the enemy has gone. The Soviet Union and the communist threat have gone, and with them the threat of surprise attack by Red hordes pouring down to the Channel ports. Therefore, what do we need to know, and about whom do we need to know it? Whose capabilities and intentions do we need to find out about?

A number of examples have already been given by the noble Lord, Lord Campbell of Croy. He spoke of international terrorist organisations. Unless we know a great deal about them, their personalities, their movements and their methods of operation we shall come nowhere near to defending ourselves against that threat to our security. Regional conflicts arise constantly. They have arisen most recently in the former Yugoslavia. Unless we know what capabilities and intentions there are in the region we and our partners will find it much more difficult to conduct even peace-keeping operations. People seem sometimes conveniently to forget that even peace-keeping operations need effective intelligence to be successful.

One aspect that the noble Lord, Lord Campbell of Croy, did not mention, except in another context, is Russia. I have no doubt that the noble Baroness, Lady Park of Monmouth, will have something to say on that subject, and I have no intention of pre-empting her. I say only that it would be extremely unwise of us to suppose that the situation in Russia will remain as it is today, still less that it will become any more stable, pacific or friendly. There is an equal possibility that it will revert, and we may he faced with a hostile Russia. We may even be faced with something like a hostile Soviet Union if the reintegration of the Commonwealth of Independent States should move forward with any degree of scale or speed. Let us not forget that, even though a great deal has happened to the Soviet armed forces and to the Soviet nuclear capacity, the Soviet Union's immensely powerful military capabilities still have a residual force in Russia and in some of the countries of the Commonwealth of Independent States.

Leaving aside all of those matters, an issue which is still of grave concern to us, and which presents a clear need for a powerful intelligence capability, is the proliferation of weapons of mass destruction and the ballistic missiles which can be used to deliver them. Like the noble Lord, Lord Campbell of Croy, I have mentioned the subject several times in your Lordships' House, including in the debate on the Address last year. The theme is now being taken up by politicians even more influential and distinguished than we are.

It is now clear to many people that the greatest threat to stability and security now lies in the spread of nuclear, biological and chemical weapons and the means of delivering them, especially through the use of ballistic missiles. It is generally known now, and certainly widely commented upon, that there are at least a dozen and possibly more countries, some of them third world countries, referred to by some as rogue states, which have or will have by the end of the century chemical, biological or nuclear weapons—and in some cases, possibly all three—and the ballistic missiles capable of delivering them over distances of 3,000 kilometres to 6,000 kilometres. I need not dwell too long on the military implications of that fact. I say merely that, if we do not use effective intelligence systems to find out what is happening in those countries, then we shall be laying ourselves open to a threat alongside which the threat of communist aggression may begin to look very mild indeed.

It is worth mentioning that, as some noble Lords will be aware, there is within NATO a senior defence group called DGP which is concerned with proliferation. In December of last year it presented a report on the implications of the proliferation of weapons of mass destruction and the means of delivering them. It brought forward a number of ideas as to the important capabilities that NATO should have in order to meet such a threat. It mentioned, for example, the possibility of some development, some modification, of strategic defence. But at the top of a list of about 14 required capabilities, the one thing that was needed was intelligence. I believe that that has become virtually self-evident.

There is certainly no diminution in the need for our intelligence services; I trust that no one would suggest that. In my view there is not much change in their function. They need to find out what potential enemies of whatever kind are capable of, what their intentions are, and what measures we should take to meet those threats.

I refer to a second aspect of the Motion on the Order Paper: the need for public acceptance of the intelligence and security services' roles in the 1990s. Perhaps I may diverge a little from the view of the noble Lord, Lord Campbell, on that, as also from that of the noble Lord, Lord Kennet. I asked myself whether in the case of our intelligence services, our secret services, we have not already carried open government a little too far. I have never been entirely happy about the constitutional changes which were visited upon our intelligence and security services.

Perhaps I may mention one other little rubric from the world of intelligence. I refer to the need-to-know principle, in which it is clearly laid out that nobody knows anything unless he needs to know it. I believe that that has a wider application too. It is a principle which applies to some aspects of government activity. In this world of transparency and openness, I believe that there are certain government activities which still are, and should be, secret. There are some aspects of government activity, especially in the international field, which the public have no need to know; and certainly not, as some of the popular press would have it, a right to know. I know that that may be a somewhat controversial view to take. However, the mirror image, or the other side of the coin—whichever way one wishes to put it—of open government is that effective Government must not be hampered and damaged by spreading around too much information which people do not need to know.

I conclude by saying that the one important factor about secret services is that they should be secret—an axiom which is not too widely accepted. I hope profoundly that there will be no greater public attention drawn to our secret services than there needs to be, and certainly not as much as there has been in the recent past.

Lord Kennet

My Lords, perhaps I may ask the noble Lord to note this. He prefaced his last observation about the need for secrecy by saying that he departed from my opinion, among those of others, on this matter. I should like to state that I agree with what he says about the need for secrecy.

Lord Chalfont

My Lords, with the leave of the House, I should like to apologise to the noble Lord if I misunderstood him. I thought that he was taking a more liberal view of the matter than I do. If I was wrong, I apologise.

6.15 p.m.

Lord Cuckney

My Lords, I begin by thanking my noble friend Lord Campbell of Croy for introducing this debate on an important subject. Secondly, I declare an interest as a former member of the Security Service.

As I am sure noble Lords recognise, the intelligence services, as has already been pointed out, operate in areas and with techniques which inevitably, by their very nature, do not readily lend themselves to public debate. As a result, they are often subjected to ill-informed criticism, cannot defend themselves, and cannot explain publicly various actions. Their successes are often successes only because they are not disclosed.

There is one particular aspect of my noble friend's Motion on which I wish to lay some emphasis. It is the need for public acceptance, particularly of the Security Service.

While considerable progress has been made, especially since 1989, in developing a greater degree of openness, and—the point has already been well made—we now have the intelligence services established on a statutory basis with oversight arrangements in place, I do not believe that the strength of those arrangements is widely enough understood and appreciated. It is upon those arrangements that I should like to concentrate.

As background, perhaps I may explain that before 1989, when the Security Service Act was passed, the Interception of Communications Act 1985 had established a tribunal to deal with complaints. The tribunal consisted of five senior members of the legal profession, plus the interception commissioner, a senior judge who, as well as assisting the tribunal, reviews the issue by the Secretary of State of warrants under the Act. The interception commissioner reports annually to the Prime Minister and his report is also laid before Parliament.

The Security Service Act 1989 established the service on a statutory footing with a legal status and replaced a directive which had been the basis for its operations for 37 years when originally issued by the then Home Secretary, Sir David Maxwell Fyfe.

With case law under the European Convention on Human Rights—I have in mind in particular the Leander judgment of March 1987—there is clear recognition of the need for a security service to provide covert response to covertly organised threats. There is also a requirement for a security service to be put on a clear legal basis with the need to ensure that there are adequate and effective guarantees in place against abuse. These requirements. I believe, are fully met by the 1989 Act. I should, perhaps, add that the Security Service is also subject to the provisions of both the Interception of Communications Act and the Intelligence Services Act. It is bound under those provisions as regards the issue of warrants. Finally, it is also subject to the Intelligence and Security Committee which reports to the Prime Minister and on which my noble and learned friend Lord Howe of Aberavon sits. I doubt whether there are any additional measures which would increase the accountability of the service while maintaining its effectiveness.

I believe that a service these days facing principally the threats of terrorism, espionage and the vitally important issue of the proliferation of weapons of mass destruction, and whose role is essentially to collect intelligence but which has no executive powers, is rightly subject to a high degree of judicial oversight by two separate commissioners and two tribunals as set out in the relevant Acts. I believe that those arrangements should be more widely accepted and understood.

No doubt the Intelligence and Security Committee has been considering the reaction of the intelligence services to the ending of the Cold War and how they have adapted to changed and, in some respects, more difficult circumstances. I hope that my noble and learned friend Lord Howe of Aberavon might be able to say something later on this subject.

I trust that in any review due recognition has been given to the essentially long-term nature of the operations and techniques used by the intelligence services and the fact that their resources cannot be turned on and off like a tap. Some of those points can be explored more fully when the Security Service Bill comes to the House for its Second Reading. It will provide an opportunity, I hope, to consider fully the proposals to introduce legislation to enable the Security Service to assist law enforcement agencies in their work against serious crime.

I have read with considerable interest the Official Report of the Second Reading debate in another place and of the two meetings of the Standing Committee. I was pleased to see that it has emerged that the primacy of responsibility for countering crime rightly lies, and should remain with, the law enforcement agencies. The Security Service will be tasked, in effect, through the national criminal intelligence service. In other words, the Security Service will act in support of chief officers of police, regional crime squads and Her Majesty's Customs and Excise.

It is, I understand, the intention that the Security Service's contribution will be co-ordinated by the national criminal intelligence service and existing law enforcement agency structures. It will not act independently. I believe that it makes good and effective use of highly specialist resources in the fight against organised crime.

6.21 p.m.

Baroness Park of Monmouth

My Lords, I too am grateful to my noble friend Lord Campbell of Croy for initiating this debate on a subject which must be of such concern to us all. It is now well over two years since in this House we had the Second Reading of the Intelligence Services Bill. I said then that this was still an unstable and dangerous world. Nothing has changed, except perhaps to reinforce that judgment. I also said that we needed to know the secret intentions of potentially unfriendly countries. For that, as my noble friend Lord Chalfont said, the country needs human sources. Those take time to be developed and cannot be turned on and off. That too cannot be emphasised enough in a period when cuts, cuts and cuts are the order of the day. I emphasise two points made clear by Percy Cradock, the then chairman of the JIC, the body which tasks the Secret Intelligence Service. The SIS—the service for which I can speak to some extent as a former member—does not create its own agenda. I emphasise that especialy in the light of what the noble Lord, Lord Kennet, said in his interesting speech.

The SIS is tasked by the Government and the JIC. Despite being undeclared until the time of the Bill of which I spoke the SIS was and always has been fully accountable to Parliament through the Secretary of State for Foreign Affairs, to whom it answers, as well as to the Prime Minister, in the same way as the Security Service worked to the Home Secretary. I am spelling that out again because I was disturbed in the debate in this House on the Scott Report by the words of a distinguished and much respected former Home Secretary: Procedures must be introduced whereby information that MI6 is used to keeping to itself—for very good reasons—is readily available, though it need not be circulated around the department. That certainly would not happen in the Home Office".—[Official Report, 26/2/96; col. 1275.] He went on to say, correctly, that MI5, knows that there is a place called Parliament. Members of the department read the newspapers daily". He added: That may not be true of MI6, cached up in Aden or the Yemen, whose members may not be used to parliamentary accountability". He went on to say that when he read the Scott Report and tried to read between the lines: I sensed that intelligence officers did not realise the importance of reporting to Parliament in some way". I find it astonishing that a Minister of the Crown, a senior Minister and one who clearly understood and valued the work of the Security Service, should not have been aware that MI6 (SIS) is and always has been fully accountable and responsible. I am still more surprised that he should have drawn such conclusions from the Scott Report. It is, of course, an immensely detailed mass of paper in which a perpetual seesaw of assessment—on the one hand, on the other hand—makes it possible to justify several contradictory conclusions. But there are some statements which are quite unequivocal. One such occurs in Volume III of the report (paragraphs G18.39) which, discussing public interest immunity certificates and what the report calls the Government's grudging attitude to disclosure, says: The strictures expressed … do not, however, apply to the SIS or the Security Service. Each of these agencies was willing that, subject to redactions to conceal sensitive contents, its documents should be disclosed to the defence. The PII class claims made … in respect of the agencies' documents were not instigated by the agencies". I could go on to refer to the major report on Operation Babylon (the supergun) which emanated from SIS but which, as its author testified, generated, far less interest than might have been expected—rather like throwing a brick into a puddle of treacle—a loud plop, and nobody took any interest". Very early in the report we learn that SIS was only tasked to put Iraq at the top of its priorities in 1988 (paragraph D5.25 in Volume II). In paragraph D5.1 we read of the volume of intelligence reports which resulted. The report acknowledges that the overall picture of events, now so well known, derived from that considerable volume of intelligence reporting.

However, as anyone knows who has worked in Whitehall, whether in a customer department, reading the intelligence or in the services producing it, the great problem is the vast quantities of paper which must be read, evaluated and acted on each day. The desk officer who is the specialist in the customer department has to decide what to send further up. Eventually, in the case of really vital intelligence which is of immediate and relevant interest, he might send it right up to the Minister, either in the form of a JIC summary or as an individual report.

Lord Justice Scott is constantly surprised at what Ministers did not see which, with hindsight, could, he thinks, have influenced their decisions. But there is only so much paper officials can expect the Minister to take home in the red box and read. My noble and learned friend pointed that out in our debate on the Scott Report. I say that because there has never been a problem of the services withholding intelligence. They are asked to produce it according to a constantly revised agenda set by the JIC. I may say that our budgets were carefully scrutinised at all times to ensure that we were giving value for money. If it is indeed secret intelligence that adds to the knowledge already available overtly and through embassy channels, the officers circulate it to customers. That is their job. All they protect, and rightly, is the identity of the source, although, like every other department, SIS—despite opening its files to inquiry—still found papers later which should have been seen. However, that was the experience of all the ministries. For example, in the MoD there were 11 fat files on only one aspect of the matters being inquired into. As the Permanent Under-Secretary in the Foreign Office explained: the nature of the Prosecution cuts across many areas of our work and it would have been very difficult, without checking every paper on every file, to be certain that nothing was being overlooked". That comes from paragraph G9.10 of Volume III.

We now have a new system of oversight operating and we have the great good fortune to have in my noble and learned friend Lord Howe someone who can speak to us with first-hand knowledge. I look forward greatly to hearing what he has to say. I have addressed the issue of whether SIS is a responsible, accountable organisation only because of the unfortunate misconception which, in the context of the Scott Report, seems still to exist. I can only say that SIS, like all the departments involved, was not perfect, but the Scott Report seems to judge that it is a highly professional body which operates with integrity and that it at no point withheld intelligence. What needs looking at, as the report concludes, is what happens to the intelligence and how it is circulated and used.

However, my chief concern is the vital importance of ensuring that we continue to maintain these highly professional services in an operational state. It is very dangerous indeed to lower our guard in terms of intelligence capacity at this moment. I agree very much with what my noble friend Lord Chalfont had to say.

Consider the situation in Russia and Russia's relations with Europe, the CIS, the Middle East and China. I imagine no one would argue that we can afford not to know about nuclear proliferation and biological and chemical warfare. Russia's security council met in February this year to work out a new strategy in "technological security". It was proposed that the state should focus on the manufacture of high technology arms, such as strategic nuclear weapons, and to that end concentrate production on a group of the best performing enterprises in the defence industry. Russia is building a new generation of nuclear submarines to replace obsolete vessels. It launched the first last year. It is building new strategic missiles and new fighter aircraft. Last June, Grachev saw the prototype, at the Zhukovsky complex, of what he called "the new multi-purpose fighter of the 21st century". Russia has repeatedly lied in the past few years about her continuing research into biological warfare, and she has still not disposed of her 40,000 tonnes of chemical weapons. Meanwhile, in January this year, she announced that her arms sales grew by 60 per cent. in 1995. She now enjoys 13.6 per cent. of the world arms market, with China and India her biggest buyers. My noble friends will remember that it was to India that the cryogenic rocket motors were sold which India needed to complete her nuclear capacity.

The defence budget this year is over 80,000 billion roubles, roughly 17.5 billion US dollars. It has moved steadily upwards for the past four years from a mere 900 billion roubles in 1992. We need surely to know what is happening, not only in Russia but in the client states, which include Libya and Iraq—both favourite hunting grounds for Mr. Primakov, the new Foreign Secretary and former head of the modern KGB, and a very different character from Mr. Kozyrev. Iran's foreign minister, Mr. Velayati, visited Moscow this month. Primakov was "most impressed by the position of my Iranian colleague, who considers the fight against terrorism could be stepped up". That is an interesting view from the Iranians. In him Primakov found an opponent of the eastward expansion of NATO "no less convinced than I am. Following the collapse of the Warsaw Treaty the NATO bloc only disrupts the balance of power in the world. Its expansion will only create tension in the international situation".

Primakov's aims, which reflect Russian thinking, included in his last job as head of the foreign intelligence service being, as he said, "extremely interested in the centrifugal tendencies developing on the territory of the former USSR". He said: "Our intelligence department is not only in favour of this, but is also working in that direction"—in other words, he was reactivating the extensive network of former KGB officers who now rule in several central Asian republics, and, incidentally, in Azerbaijan, and reconstituting a meaner, leaner Soviet Union, an objective that has long been plain.

The other main plank of Russian foreign policy is to neutralise NATO. Vitali Churkin is already inside NATO's councils, and General Grachev's view of the 16++1 formula in NATO was clearly expressed in the context of his attendance at the NATO Defence Ministers' meeting in November 1995. He said that NATO "would be transformed not by broadening its zones of responsibility", presumably code for enlargement, but by "transforming it into an instrument of pan-European collective security". The consultative mechanism set up in Bosnia would be the prototype for future relations. Russia was gradually, he said, being introduced into NATO's political kitchen. Of importance, he said, was Russia's presence in NATO's top political body as this would strengthen Russia's capacity to influence political decisions. So much for the infiltration method.

General Grachev, in another mode in Belgrade in February this year, was threatening that if NATO expanded eastward, "even if one single state were to be admitted into the alliance", Russia would seek new allies in the east, build up its military power and reconsider disarmament agreements, including CFE, START I and START II. Primakov, this month in Slovakia, while saying that Russia would not bang the table or order anyone not to join NATO, observed: "Slovakia has a negative trade balance with Russia. Do not get too involved with NATO. NATO comes and goes. Nations remain." And he made equally menacing noises to Norway on enlargement.

Does all this sound like a stable, safe world where we can afford not to have strong and effective intelligence services, if only, through early warning of the undisclosed intentions of our enemies, to buy us time to reconstitute our defences should that prove necessary? Do we not need to know whether China is banging drums or really getting ready for something more serious? I remind the House also that the IRA has always had an international dimension (Semtex from Czechoslovakia, arms from Libya, and, curiously enough, arms from Estonia) and the IRA is still with us. The maverick states that aspire to be nuclear powers and meanwhile are quite happy to manufacture biological and chemical weapons are still with us. They have not gone away.

I conclude with Mr. Primakov's own words last December. "Some external forces wish Russia's disintegration. We need to know their intentions.

We must try and neutralise their intentions". That goes for us, too. And I do urge that the classic targets of the intelligence services should not be crowded out by drug trafficking, international crime and all those worthy, safe subjects.

6.35 p.m.

Lord Knights

My Lords, I, too, thank the noble Lord, Lord Campbell of Croy, for giving us the opportunity to discuss this very important topic. I feel I should first say, however, that it was not without some hesitation—and indeed some measure of trepidation—that I added my name to the list of speakers for this debate. My misgivings arose not only from my recognition of the considerable qualifications of the noble Baroness and other noble Lords whose names were already there, but also from the fact that, while I have had some experience of the Security Service, MI5, I have had no personal contact with the sister intelligence services, SIS and GCHQ. I therefore seek your Lordships' indulgence should my comments be thought to be somewhat more narrow than they might perhaps otherwise have been.

I am also very conscious, as was mentioned, that a Bill to widen the responsibilities of the Security Service has already been introduced into this House and there will be another, perhaps more appropriate, opportunity to debate in detail the important issues that arise from that.

When preparing my remarks I took the opportunity to re-read some of the debates that took place in this House prior to the enactment of the Security Service Act 1989 and the Intelligence Services Act 1994. They brought home very forcefully the changes that have taken place in the status of the intelligence and security services in the past seven or eight years.

Who would have imagined, for example, that by 1993 MI5 would not only take the secrecy wraps off the director-general's identity and the address of her headquarters, but would also publish details of the management and organisation of the service and the methods used by its officers to obtain and gather intelligence? In a few short years, the image of the service has moved from one which, in the words of Mr. Peter Wright in his book, Spycatcher, bugged and burgled its way across London", to one which is clearly now well controlled, accountable in a way it never was before and with clear statutory authority to justify its activities.

Despite those somewhat remarkable developments, it would appear from exchanges in the other place when Members considered the current Security Service Bill that not everybody is yet convinced that the changes have removed entirely the scope for suspicion as to the service's activities. Some, at least, of the old rumours and allegations still persist, although much less vociferously and on a much reduced scale. Be that as it may, noble Lords may agree that, overall, there is much less suspicion generally about the security and intelligence services, which must have an effect on the morale of those who carry out this often dangerous work.

Whether these new attitudes have in any way made that work more difficult, as some thought might be the case, I am of course not able to say. But it would be interesting to know whether they have in any way compromised or complicated the service's relationships with its opposite numbers in other countries, a matter already touched on by the noble Lord, Lord Campbell of Croy.

It is not only the image and status of the Security Service which have changed. Its functions also have had to adjust to the changed situation in Russia and Eastern Europe generally which has already been referred to. The threat from subversion has clearly diminished, but at the same time the threat of violence arising from terrorism has clearly increased. In this field of course in 1992 the service took over from the Metropolitan Police the responsibility for countering IRA terrorism on the British mainland, and events of the last week or so have indicated quite clearly that there is still considerable work to be done in that field.

As your Lordships will be well aware, the principal statutory responsibility laid on the service is to identify, investigate and counter threats to national security as well as threats to the economic well-being of the United Kingdom which arise from overseas. Specific reference is made to threats from espionage, terrorism and sabotage. In order to achieve this its officers gather, assess and develop intelligence to the point where direct action to counter the threat needs to he taken, a point which again was made by the noble Baroness, Lady Park of Monmouth.

Clearly in doing this there comes a point where serious crime, be it the disclosure of secrets, firearm and explosive offences or the like, raises its head. It is at that point, where arrest and prosecution have to be contemplated, that the police and the Crown Prosecution Service become involved.

There is nothing new in this. Indeed, the Act of 1989 specifically authorised the service to pass on, for the purpose of preventing or detecting serious crime any information which it obtains in the proper discharge of its functions. It is now being suggested that it should also be a statutory function of the service to act in support of the activities of police forces and other law enforcement agencies in the prevention and detection of crime. In that context the word "serious" is always brought in. Clearly this must presuppose that the service will be able actively to seek intelligence about serious crime, whether it is a natural extension of its normal functions or not.

This clearly raises some important issues, particularly who is to have supremacy in any investigation which does not spring from the discharge of the service's traditional functions. It also raises the possibility of the police actively seeking the assistance of the service by way of its specialist skills of investigation, collation, assessment, disruption and prevention when inquiring into criminal matters which are the normal purview of the police. The noble Lord, Lord Cuckney, has already discussed this particular problem, and I agree with all he had to say about it. But there are a number of problems which are thrown up by this new arrangement, particularly in connection with the handling of informants, disclosure of information in criminal investigations, the effects of the Police and Criminal Evidence Act on the activities of Security Service officers and the arrangements for their accountability, all of which will no doubt be addressed in your Lordships' further consideration of the new Bill.

There may well be problems here in comparing their position with that of the police officers with whom they are working. Members of the special branches of police forces have for a number of years of course been doing very similar work in connection with terrorism in particular and subversion, and they have none of the additional powers which the Acts have given to the Security Service, for example, to obtain warrants to enter premises. In the future when police and security officers are working together it will be essential, it seems to me, that they should act under the same identical powers. Currently that is not the case, and that matter too will have to be given consideration later on.

There is the question too of whether the functions will extend further; indeed, whether they should. For example, when we are dealing with terrorism we normally think of bombs and explosives being the way in which the wishes of the terrorists are sought to be effected. But it may not necessarily be explosives and firearms. Pressure can also be put on people to do things they would not otherwise wish to do which could well also come under the heading of terrorism. If that be the case, it will probably be the police who will be investigating rather than the Security Service. Here again, when one is dealing with, for example, the Animal Liberation Front, the term terrorism can undoubtedly be applied to various activities, and the rules which are being sought now and the activities which are being arranged now for collaboration with the Security Service in this field must also be considered in relation to these new matters, it would appear to me.

There is much to be discussed. There are many important matters which are going to come up and it will not just he a matter of saying that the Security Service must and will assist the police in criminal matters. It is a much wider argument which we shall have to address and I look forward to taking some part in it. As I said at the beginning, I have concentrated very much on one service alone. I trust that what I have had to say will at least be helpful when we come to discuss matters further on the Second Reading of the Bill.

6.47 p.m.

Lord Howe of Aberavon

My Lords, it is for me a privilege to be able to follow the noble Lord, Lord Knights, and to say to him, although it need not he said, that he had no need whatever to display such diffidence in addressing this topic because his experience in this field has lent authority to his remarks, particularly on the Bill which we shall be discussing later.

I hope your Lordships will forgive me if I do not now turn to those topics but turn instead to thank my noble friend Lord Campbell of Croy for having introduced this subject; to apologise for my absence from the early part of this debate because I was concluding a discourse in another place; and to say that I am present not least because my noble friend very properly reminded me, given my position as the only representative of your Lordships on the Intelligence and Security Committee (at least during the first 15 months of its existence), that the House might expect to hear a word from me.

I am indeed glad of the opportunity that that offers, but I must at the same time respect the need to balance that commitment to this House with a corresponding duty of confidentiality to my colleagues on the committee. In particular, I have an obligation not to pre-empt the publication of the committee's first annual report which was submitted as required by the end of last year. We have discussed it with my right honourable friend the Prime Minister and it is due for publication before too long.

The fascinating thing to me, and it has been noticed by many other speakers, is the huge openness of the process on which one is there engaged, which underlines the scale of the sea-change which has taken place even in the 13 years since I first had the privilege of having direct ministerial responsibility for two of the services.

I listened with great interest to the speech by my noble friend Lady Park when she diverted for a moment or two to offer some strictures on the noble Lord, Lord Jenkins of Hillhead, and despite his absence—

Baroness Park of Monmouth

My Lords, I am so sorry. It could well have been the noble Lord, Lord Jenkins, and he has said much worse things, but in fact it was the noble Lord, Lord Merlyn-Rees.

Lord Howe of Aberavon

I accept the correction with alacrity. I am sorry to have uncloaked a secret which perhaps we did not need to know the answer to. At all events I endorse my noble friend's strictures and also her tributes to the service of which she was such a distinguished member. She identified very well the difficulty of operating what I described as a high speed, multi-directional, leakproof sieve, which is what is involved in getting intelligence to the right place.

My noble friend was right also to remind us that, although the world is much more open now in many ways, it is not significantly less frightening. It is a world in which people—at least people in democracies—have come to expect much more candour from those who govern and take at its face value Balfour's proposition that, democracy is government by explanation". My noble friend Lord Campbell said that we must take trouble to justify the role of the intelligence services. But, as he and the noble Lora, Lord Chalfont, pointed out, there is still another side to that equation. In the real, operational world of intelligence and security, the need-to-know test remains of crucial importance. Achieving that balance is difficult, particularly when we are going through a process of moving from darkness into light.

I have a vivid recollection of just how badly we handled the matter—I have mentioned this in the House before—when we first began disclosing the reality of GCHQ to an astonished world. At 11 a.m. on the morning that I was to announce changes in the House at 3.30 p.m. in the afternoon, I summoned to my office the noble Lords, Lord Healey and Lord Murray of Epping Forest, to let them into the great secrets which were about to burst upon the world only a few hours later. Within days, of course, GCHQ had achieved world-wide notoriety as one of the best known and most controversial four-letter words in the language. It was a very mishandled exercise.

Since then there has been a near torrent of change. My noble friend Lord Cuckney rightly pointed out the many protections which statutes of the past 10 years have introduced for the citizen. In that context, the Intelligence and Security Committee, as the House will recognise, has potentially a most important and useful role to play in helping to establish a bridge of mutual confidence between the services and the public whom they seek to serve. It is right that that should be done by the means of reports direct to my right honourable friend the Prime Minister, who is uniquely responsible for co-ordination of the services and it is right that the committee should be representative of both Houses of Parliament.

In the process of securing its own legitimacy, the committee realises that it must have in mind two distinct objectives. It needs to establish its independence—that it is not in any sense in the pocket of the services and that it has not been the victim of what I believe is known as "agency capture". That is necessary not just for its general credibility but, more particularly, in case the need arises, as it might, for urgent investigation at speed of some matter of critical importance which could happen at any time. If the committee is to be seen as qualified to undertake that task, it needs to convince people of its independence in that way.

On the other hand, the committee needs to convince the agencies—those who work in them as well as those who command them—that the committee and its members can safely be regarded, so far as is proper and necessary, as totally reliable partners within the ring of secrecy. Candour between the services and the committee, which is essential, can be achieved only if each side can be totally confident of the other's commitment to security. So far as my word counts for anything, I can assure the House that my colleagues on the committee are equally conscious of the importance of both sides of that critical equation.

In fact, for a number of reasons it is a propitious time for the committee to start work. The first reason is that the tasking of the agencies is undergoing great changes both ways on an unprecedented scale. One need only look across at what one used to call the Iron Curtain or across the Irish Sea to understand that. I emphasise that it is both ways because my noble friends Lord Cuckney and Lady Park emphasised the long-term nature of the threats that we face and the need to recognise that the tasks have to be adjusted with care.

The second reason for care is that the services, as several speakers pointed out, have been called to take on new tasks, for example, in the field of serious organised crime. Incidentally, we recognise there the role of the Home Affairs Committee in the other place and the limitations of the Intelligence and Security Committee.

The third reason why it is a well timed invention is that the services themselves more than ever before are learning the possible value of the input of external expertise and advice. The investigation conducted by Sir Michael Quinlan, the former Permanent Under-Secretary to the MoD, was of enormous value. So too was the examination conducted at GCHQ by Sir Roger Hurn, the chairman of Smiths Industries. Both have made contributions of great importance.

The committee is also aware, as are the services, of the lessons to be learnt from the experience of other countries. Like the services themselves, we have been studying most closely some of those implications. The noble Lord, Lord Kennet, referred to some lessons that might be learnt from the experience in the United States. We are looking at continental Europe as well as the rest of the Anglo-Saxon world for what might be learnt. The noble Lord was quite right to underline the importance of the Ames case: 10 years' continuously treacherous conduct by a senior CIA officer gives a warning that is perhaps even more alarming than any from the earlier years of our own services. The lessons of that case need to be studied most carefully.

The committee has one other possible merit, which to some extent surprises me: the ability that it may develop to take a panoptic view of all the services and agencies and of the lessons from comparing the problems and practices of the different services. I am now conscious of the fact that I have a broader and more comprehensive insight today than was ever available to me during 11 years' service in successive high offices of state.

Perhaps I may also say to your Lordships that I am encouraged by the way in which the committee has approached its task, taking full advantage of the strength of our constitution—namely, its multi-party nature—and taking full advantage of the diversity of experience of the members of the committee. Although all save two have had experience of office, the contribution made by those two is in no sense insignificant—one Labour member and one Liberal Democrat of long experience, the right honourable gentleman Alan Beith. All of them make a contribution that is well worth while. The only other member with previous Cabinet experience is my right honourable friend Tom King. I pay tribute to his well judged chairmanship of the committee, as also to the commitment of all my colleagues to a workload that is so Stakhanovite that I am becoming increasingly daunted by the prospect of remaining one of their number.

Let me draw my speech to a close. What is taking place here is an important exercise in open government. As many noble Lords pointed out, it goes far beyond anything that our media in particular might have dreamt of, even 10 years ago. Therefore, it is important—I echo a point made by the noble Lord, Lord Chalfont—to remind the fourth estate as well as ourselves of the role that it can and should wish to play in preserving the proper balance of our free democratic society. We are rightly reluctant to shackle the media with any kind of external regulation. That does not mean that they should regard themselves in this crucially important field as free from any kind of control whatsoever. Ideally, there should be self-regulation or, better still, informal instinctive self-discipline.

I close by drawing to the attention of the media an important observation that first came to me from a distinguished member of their own profession and one, incidentally, who did more than any other lay individual to promote televising parliamentary proceedings. I refer to Sir Robin Day and his book Grand Inquisitor. There he offers a quotation from the sometime Liberal Member of Parliament and Lord of Appeal, who died in 1921, Lord Moulton, who wrote as follows: There are three great domains of human conduct. The first is where our actions are limited or forbidden by law. Then there is the domain of free personal choice. But between these two is a third domain, that in which there is neither law nor unfettered freedom. This is the domain of 'obedience to the unenforceable', where people do right although there is no one and nothing to make them do right but themselves". The price of freedom is not just eternal vigilance. It is also, on the part of the fourth estate as well as on the part of the rest of us, unflagging discretion, an obligation that rests on all those who claim a genuine interest in the security of our nation.

7 p.m.

Lord Bethell

My Lords, I believe that I am the only speaker so far in this debate never to have had any official connection with the intelligence or security services. However, I am one of those, like the others who have spoken, who have a great admiration for the services and for their achievements in recent years.

The reforms recently introduced by this Government are excellent and positive and I congratulate the Prime Minister and Ministers on bringing them about. It is essential that there should be a statutory basis for the services and if it were not for the reforms of the past few years we would probably not be taking part in this debate at all. My noble friend Lady Park mentioned that, in theory, there was always complete parliamentary accountability for the services at every point. But until recently, of course, there was a convention that the facts of the services were not discussed in this House or in another place.

My noble friend and the noble Lord, Lord Chalfont, are the only two who have spoken so far who have doubts about the changes that have taken place and who are prepared to emphasise the need for secrecy as overriding the idea that the people have, so far as possible, the right to know what is done in their name. There have been some important steps taken towards that right—it is a right and it is essential—because, while we must have guardians for the nation's security, someone must guard the guardians. The only body which can, at the end of the day, be that guardian is Parliament.

I realise that in the past Ministers—in particular the Prime Minister, the Foreign Secretary and the Home Secretary—have had control over the services. But, as has been pointed out, it is not easy for busy Ministers at the end of a day to go through detailed points about these sensitive issues to maintain the sort of control that is needed and make sure that Parliament is kept in the picture. Ministers often do not have the time to keep the necessary control.

Baroness Park of Monmouth

My Lords, perhaps my noble friend will give way; I want to make just one brief observation. When I made those comments I was talking about the intelligence; the product. I was not talking about issues like decisions on operations, clearances and so forth. Time is always found for that, both by Ministers and by us.

Lord Bethell

My Lords, I accept that Ministers and indeed Parliament can never have an overview of the operational day-to-day basis of the services. But there must be clear guidelines which must be known to Ministers and to Parliament, otherwise we shall find ourselves in a muddle.

In the past grave mistakes have been made by the services. I think in particular of the 1940s and 1950s when the campaign to roll hack communism turned out to be counter-productive and, in particular, I refer to the question of the Albanian operation. In that regard I must declare an interest because I wrote about it at some length.

Perhaps I can be guided by the adversaries of those who have been connected with our services—I have spoken to many of them in Russia in recent years. Retired members of the intelligence services of the Soviet Union have nothing but admiration for the work of MI6. They are touchingly appreciative of the professional capabilities of my noble friend Lady Park and her former colleagues. Whether or not that is a good thing, I should not like to say; I simply point it out.

One point that was raised by my noble friend Lord Campbell in his opening remarks was the question of co-operation. That issue needs to be looked at most carefully. Speaking to a senior member of the Russian intelligence services a few months ago, I was told—I am sure this has been spoken of publicly as well, but it was spoken of also in conversation—that the Russian services are anxious to co-operate with their British opposite numbers over a whole range of important issues, in particular nuclear proliferation, serious crime and terrorism. I hope that my noble friend the Minister will be able to say something about that. I gave him notice that I would be raising this point and we shall see whether or not it is possible for him to comment on it.

It would be a mistake, and indeed dangerous, for us to reject out of hand the suggestion of the Russian Government and the Russian services to co-operate with us over the important point of nuclear proliferation, whether to rogue states or to rogue groups. The matter was raised in terrifying detail a few days ago by my noble friend Lady Thatcher.

I know that we must not be naïve about that point. I know that one needs a long spoon before sitting down to dinner with the Russians. I realise that there are areas of conflict over Chechnya and perhaps over Serbia and Iraq. I listened carefully to the speech of my noble friend Lady Park, though I confess that I shall need to read it. She delivered it rather quickly and it was extremely detailed. Spoken as it was with the authority that my noble friend possesses as a former well-known officer of MI6 who served in the Soviet Union, I shall look carefully at what she said.

It seemed to me that my noble friend was saying—I am sure that she will correct me if I misunderstood—that the basic intentions of Russia today are so dubious, indeed so inherently hostile, that co-operation with them should not be countenanced. I wonder whether that is the view of the Government and whether my noble friend the Minister can say something in that regard. It is my impression that the Government as a whole wish, as far as possible, to be a partner of Russia today in a number of areas. I realise that there are many areas where we disagree; but I believe that the Government wish us to work with the Russians if we can. I know that that will break the habits of a lifetime for many of us. But the world has changed and East-West conflict on the nuclear scale is extremely unlikely. Instead, taking the place of Armageddon in the shape of the Soviet Union versus the United States, we have the horrifying spectre of terrorist groups acquiring weapons of mass destruction.

There is also the question of Russian help in the drugs trade. Russia itself is a major conduit for drugs coming from the Indian subcontinent to Europe and other areas of serious crime, including the Russian Mafia itself. If we can co-operate with each other in a way that is consistent with the interests of our country, of the Western world and of the Russians—and I believe that there are areas of common interest—then we shall be more effective at fighting those serious dangers that face us.

I believe that the services are vitally important to the future of our nation. It would be ridiculous of anyone to think of starving them of funds, reducing them or cutting them back. On the contrary, they are more important than they were. I wonder how many people thought when the IRA ceasefire was introduced a few months ago that the days of MI5 were numbered and are now eating their words. Clearly, the security services must be strengthened for the future as well as for the present. Today's dangers may disappear or diminish, but others will appear. We live in a very dangerous world. Therefore, we need these services most desperately. I trust that the Government will make sure that they are preserved and simply that they are directioned in the most effective and appropriate way so that the citizens get the most out of the money they spend in return for their provision.

7.11 p.m.

Lord Richard

My Lords, we have had a very interesting debate over the past hour and a half. Personally, I am very grateful to the noble Lord, Lord Campbell of Croy, for raising the subject this afternoon. It is timely that we had a look at the operations of the intelligence and security services. We have done that to a certain extent this afternoon, although inevitably within the limitations of a short debate.

I thought that the noble Baroness, Lady Park, was a little over-sensitive about Scott. After all, if one read the report in detail, which I fear I had to do, one of the few bodies to emerge with a great deal of credit was her "old firm". The Secret Intelligence Service came out of it extraordinarily well for their preparation and preparedness to disclose to the defence documents that other people were not prepared to disclose and the extraordinary frankness of at least one or two intelligence officers who gave evidence at the trial. Reading the report and dividing it into heroes and anti-heroes, and a few neutrals between the two, I put the SIS very firmly in the hero bracket and I am delighted so to do.

I listened to the noble and learned Lord, Lord Howe, with great interest. He lifted the veil very slightly on the operations of the Intelligence and Security Committee. We look forward very much to reading the report. He prayed in aid the multi-party nature of the committee. I was not going to say anything about it until he did that. It was rather like the defendant who, at the age of 55, pleads for leniency on the ground that he is an orphan because his parents are dead. Technically, it is a multi-party committee. Its multi-party nature is one Labour, one Liberal and five Conservatives.

Lord Howe of Aberavon

My Lords, there are at least three Labour members. There is Dr. John Gilbert, Mr. Barry Jones and Mr. Allan Rogers. I do not believe that I have left any out. Certainly, it is a multi-party committee.

Lord Richard

My Lords, I am sure that the noble and learned Lord is right. Perhaps I may point out that according to a research paper from the Library of the House of Commons of 4th January, the membership is given as the right honourable Tom King, the right honourable Alan Beith, the noble and learned Lord, Lord Howe, the right honourable Sir Archibald Hamilton, Barry Jones, Michael Mates and Sir Giles Shaw. If that is wrong then the point I make is invalid. Certainly, as of the date of the publication of this report, the ratio was 5:1:1.

Lord Howe of Aberavon

My Lords, the second report we presented to Parliament was an interim one on the work of the security services against organised crime. The names are all listed as they were in our interim report of last May. I would not like to think that Mr. Barry Jones and Dr. John Gilbert, of all people, are overlooked by the noble Lord.

Lord Richard

My Lords, if it is a bad point, I would not dream of pursuing it, and I understand that it is a bad point. I hope that those responsible for the production of this document from the House of Commons' Library are prepared to read House of Lords Hansard to see that they have put me in a position of making a bad point. But there we are.

What is also interesting about this debate is the extent to which openness has been an issue and which the House has been prepared to discuss. That is openness in relation to the operation and role of the Security and Intelligence Service. I say to the noble Lord, Lord Bethell, and perhaps to the noble Lord, Lord Chalfont, that one cannot go back on the position that we have now reached. It would be quite impossible to reverse the extent to which these services are now in the public domain and subject to public and parliamentary scrutiny. The question that we have to ask ourselves is this: if we cannot go back how do we try to make this new system we have under the successor Act work, and work well? For my part—

Lord Bethell

My Lords, I must have made myself unclear in my remarks. I am very much in favour of the greater openness that has been introduced. In fact, I would like to see the system made more open.

Lord Richard

My Lords, surely I cannot make two bad points in the same evening! Certainly, I thought that I heard the noble Lord, Lord Bethell, say that. I have noted him down as saying that. It is certainly a good point as regards the noble Lord, Lord Chalfont.

Lord Chalfont

My Lords, perhaps I may intervene just to say that that is exactly what I did say and that the noble Lord has a very good point.

Lord Richard

My Lords, I am much obliged. Reinforcements have arrived. As I say, I believe that the issue of openness and the extent to which these services are now more subject to public scrutiny and disclosure is one which I am glad the House discussed this evening.

Perhaps I may make a basic point, as I see it, as regards these services. First, the collapse of the old Soviet Union empire in eastern Europe, and the apparent decline of Russian influence elsewhere, has not reduced the need for the Government to have proper secret intelligence. That seems to me to be the basic first point. The second point is that the uncertainties of the old Soviet Union and of the Middle East, as well as the interests of the United Kingdom in other parts of the world, have created a situation in which the UK's political, military and commercial interests still require the Government to be well informed about the intentions and activities of other governments and groups. The third point, which flows from the first two, is that this requirement is now made more pressing by the gradual spread of weapons of mass destruction, whether they are nuclear, biological or chemical. I therefore agree with a large part of what was said by the noble Lord, Lord Chalfont, and by the noble Baroness, Lady Park in this respect.

The fourth basic point is that the threat to British interests from terrorism has not declined. The return of the provisional IRA to violence is a great disappointment, but perhaps it is not entirely surprising in view of the history of the past two to three years. But it is a disappointment that they have apparently returned to a degree of violence. Middle East terrorists are still active. Some groups decline and others grow. But the need to maintain coverage of their activities is constant because it is difficult to predict when they will turn on British interests.

So I finish with the basic conclusion on this part of what I have to say. The continuing efforts by the security and intelligence services are clearly necessary in such an unsettled world. Indeed, the more unsettled the world is the greater the need for vigilance. The end of the Cold War and financial pressures have meant that the agencies, like other departments, have had to trim their budgets, but we must be careful that the cuts are not so severe that the agencies do not have the staff to respond to new threats. The coverage of organisations which threaten United Kingdom interests cannot be achieved overnight from scratch. Again, I agree with what the noble Baroness, Lady Park, said on this. Experience in this field takes time to develop.

The agencies have received a bad press on occasions in the past. Some of it was deserved, but much of it was not. As the noble Lord, Lord Cuckney, said, successes often cannot be told, and even when they can they frequently receive very little attention.

Public perception of the agencies has improved, thanks presumably to the introduction of the legislation and the new oversight arrangements. That has allowed proper debate about their role and, through the oversight bodies, a fairer assessment of their performance. I agree with the noble and learned Lord, Lord Howe, that the noble Lord, Lord Knights, should not apologise for raising the issue that he did. It is contemporary, it is pretty fundamental and it is something that I am not sure we have yet got right. Therefore, I should like to spend one or two moments trying to deal with the issues raised by the noble Lord.

The Security Service Act empowered that service to investigate threats to national security which were, in effect, espionage, terrorism and subversion. The extension of its responsibilities to cover organised crime is prima facie logical. Organised crime is growing, thanks to the money to be made especially from drugs; and the state of the world where, in countries like Russia, law and order seem to be on the verge of breaking down, thus allowing and even encouraging organised crime. We must also bear in mind the ease of travel and the speed with which money can now be sent through the banking system. In its more extreme forms, organised crime poses a threat to the security or, if your Lordships prefer, to the wellbeing of the nation.

I am not against the idea that the Security Service and other agencies should have their responsibilities extended because their skills can contribute to the investigation and combating of organised crime. Those skills have been learnt over many years and include long-term investigations using high quality personnel and methods. The Security Service, after all, has a proven track record of success in its work in support of the police against one of the most effective terrorist organisations in the world, the Provisional IRA.

The Security Service has some experience of investigations where it is necessary to collect evidence for presentation in court or to allow investigations to proceed in such a way that others, such as the police or Customs, may actually collect the evidence and bring the prosecution. Also, it has already had some years of experience of effective co-operation with the police and Customs. However, it is important to emphasise that the lines of accountability must be clear. As the noble Lord, Lord Knights, said, that is difficult, but that very difficulty underlines the importance of the point.

The role of MI5 in relation to organised crime has to be one which is basically supportive. I believe that that is recognised by MI5 itself. I do not think that the public would be happy with a situation in which the security services were operating freely in a police environment. I believe that many people would accept that they should support the police in such important areas, but I do not think that people would accept that they should operate freely without the police being in the lead.

I conclude by thanking the noble Lord, Lord Campbell of Croy, for initiating a debate in which I have made at least two bad points, but I hope that I have made five that are good.

7.23 p.m.

Lord Chesham

My Lords, I too thank my noble friend Lord Campbell of Croy for tabling the Motion and all noble Lords who have participated in the debate for their thoughtful and stimulating contributions. I am almost overawed by the experience and knowledge of speakers.

I have listened with great interest to the debate, which has touched on a range of matters to which the Government attach considerable importance. As noble Lords are aware, the Government have taken a series of important steps towards greater accountability and openness, wherever possible, in security and intelligence matters. As has frequently been mentioned, with the passage of the Security Service Act 1989 and the Intelligence Services Act 1994, all three intelligence and security agencies are now avowed and have been placed on a statutory basis. The figure for their aggregate expenditure is published annually. In addition, a Committee of Parliamentarians, the Intelligence and Security Committee, established under the Intelligence Services Act, now scrutinises the expenditure, administration and policy of all the agencies, and has so interestingly been described by my noble and learned friend Lord Howe.

However, it is important to make a distinction between proper accountability for the agencies in areas such as finance and administrative policy, and the continued need for secrecy regarding operations. If the agencies are to perform their responsibilities effectively, they need the protection which secrecy offers. Hence, this Government, like their predecessors, have refused publicly to provide information on the operations of the security and intelligence agencies, including matters which fall within the scrutiny of the Intelligence and Security Committee. Comment on such matters, either through what is said or what is not said, could have a bearing on the effectiveness of the agencies, on the safety of their staff and those who co-operate with them, and on their ability to retain the confidence of those with whom they work. Those very considerations preclude me from responding to some of the issues raised by noble Lords.

I now turn to the functions appropriate to the agencies in the 1990s. The Cold War may have ended but, as has frequently been said, the world remains a dangerous place. One might say that though we have slain the dragon, we have entered a wood full of snakes. Threats to British interests worldwide continue to abound—international terrorism, weapons proliferation, espionage, serious crime in all its various forms, including drug and arms trafficking and financial fraud. Indeed, in the case of nuclear weapons proliferation, for instance, the risk has actually increased as a direct result of the break up of the former Soviet Union and its stock of arms. This general perception is shared by many of our allies and democratic neighbours, who, like us, see the need to maintain effective intelligence services.

My noble friend Lord Campbell of Croy mentioned co-operation with other countries, as did other noble Lords. The threats of terrorism and espionage and from proliferation are international, and are hence more easily identified if like-minded countries co-operate. The agencies therefore maintain contact with a wide range of individuals and organisations, a two-way process of advice and assistance which is of great benefit to the UK national interest. Close intelligence relations are maintained with allies, for example, in NATO. Liaison with other countries has given invaluable help in protecting UK interests.

My noble friend Lord Bethell asked specifically about co-operation with the Russians on, for example, drugs, nuclear proliferation and counter-terrorism. Her Majesty's Government have discussed with the Russian authorities the issues highlighted by my noble friend. The United Kingdom's security and intelligence agencies engage in collaboration with the intelligence and law enforcement agencies of a large number of countries where we have common interests and concerns. Such arrangements depend on confidentiality and it is not the Government's practice to comment on that or other operational activities of the agencies.

We have had some discussion of the Security Service Bill. Your Lordships' House will have an opportunity to debate that shortly. I refer to the serious crime function of the Security Service. Those provisions will come before this House soon. I do not want to pre-empt that debate, but I suggest that the Bill represents a good example of the sensible evolution of the role of an intelligence agency to take account of changing circumstances. The threat posed by organised crime is a serious one. It is also growing in sophistication and complexity. We must ensure that our law enforcement agencies have all the necessary skills, resources and support at their disposal to tackle that threat. They already benefit from the valuable support of SIS overseas, but the Security Service is not permitted by law to lend assistance here in the United Kingdom. The Government believe that it would be sensible to allow ourselves the opportunity of using the skills and capability of the Security Service, when circumstances permit and subject to appropriate controls, in support of the efforts of the police and other law enforcement agencies.

I assure your Lordships that extending the functions of the Security Service will not be to the detriment of its existing responsibilities. Dealing with terrorism will remain the service's top priority. The allocation of resources to the proposed new functions will be subject to the demands placed on its other functions. It is essential that the service retains the flexibility to respond to sudden demands in respect of any of its functions.

So far as concerns public acceptance of the security service—we are talking about openness and safeguards—the security service is the first to recognise in today's climate of openness the need for public understanding and acceptance of its role. To that end, a number of significant steps have been taken to provide the public with more information about the service and its work while bearing in mind the need to ensure that its operations are not compromised. That was a point emphasised by the noble Lord, Lord Chalfont, and my noble and learned friend Lord Howe.

In 1991, the director general was named for the first time. The location of the headquarters of the security service has been disclosed. The security service's booklet published in 1993 made available for the first time a considerable amount of information about the service's work. The director general has built on that during her three lectures to public audiences—the Richard Dimbleby and James Smart lectures in 1994, and her speech to the English Speaking Union in 1995.

But public acceptance is not just about openness. It stems also from the knowledge that there are proper statutory safeguards to ensure that the service acts only in accordance with its functions. Above all, it is important to understand that the security service is fully accountable to the civil and criminal law.

As my noble friend Lord Cuckney said, the Security Service Act 1989 established a number of safeguards. First, the Act provides for a tribunal comprised of senior members of the legal profession to investigate complaints from members of the public who are aggrieved by anything they believe the security service has done to them or to their property.

Secondly, the Act provides for a commissioner, who is a senior judge, to oversee the authorisation by the Secretary of State of warrants allowing the service to enter or interfere with property and to assist the tribunal in its work. Both the commissioner and the tribunal are independent.

In addition, the service is subject to the Interception of Communications Act 1985, which makes it illegal to intercept mail or telephones on the public network unless the interception has been authorised personally by the Secretary of State. The Act provides also for oversight by an independent commissioner and a complaints mechanism for members of the public. The Intelligence and Security Committee established under the Intelligence Services Act 1994 provides a further mechanism for oversight and accountability.

It is important that members of the service who are concerned about the nature of the work they are required to undertake can discuss their concerns with someone outside the service. That role is fulfilled by a staff counsellor who is independent of the service.

The noble Lord, Lord Kennet, mentioned co-operation with the USA. There is some history of that. US operations in the UK are covered by arrangements made under the 1951 agreement and the Visiting Forces Act 1952. No activity considered inimical to the UK's interest is or would he permitted. The US has undertaken to respect UK law under Article 2 of the NATO Status of Forces Agreement.

Lord Kennet

My Lords, does that apply to the presidential direction of last July to the CIA to engage in espionage on the industry and trade of friendly countries, including this one?

Lord Chesham

My Lords, it applies in that the US has undertaken to respect UK law. If it does not respect UK law, it is liable to the law in the same way as is everyone else.

The noble Lord, Lord Chalfont, mentioned counter-proliferation and so on. The agencies recognise the importance of intelligence gathering in combating the growing menace posed by the proliferation of weapons of mass destruction and missiles for their delivery. I can assure noble Lords that that is a requirement to which the intelligence agencies accord a suitably high priority, but noble Lords will appreciate why it would not be appropriate for me to elaborate further.

Mention has been made of the Scott Report and the suggestions made about the role of intelligence and government departments. Those recommendations on intelligence handling are currently the subject of interdepartmental discussions. Ministers have said that a report will be made to the ISC. It would not be appropriate to comment further until such deliberations have been concluded.

My noble friend Lady Park and the noble Lord, Lord Chalfont, talked about the continuing danger of the world in which we live, and resources. As many people have pointed out, giving real examples, the world remains a dangerous place. They have stressed that our intelligence agencies must retain the capacity to respond to complex and changing threats.

The Government share that concern about the instability that remains in the world. It is right that the agencies' budgets are scrutinised regularly, as is all government expenditure. There is no question of national security being put at risk or of the operational capacities of the agencies being undermined.

In conclusion, once again I thank my noble friend Lord Campbell of Croy for tabling the Motion which has enabled noble Lords to give us the benefit of their vast experience and a most interesting spectrum of views.

7.36 p.m.

Lord Campbell of Croy

My Lords, I am most grateful to all those who have spoken in the debate. They have spoken and expanded upon parts of the subject to which I did not have time to extend. I hope that the total of the contributions will provide food for thought for the Government. There is time for me to make one or two comments.

First, the noble Lord, Lord Chalfont, spoke realistically about the Russia of today and other nations which might have or try to obtain ballistic missiles with warheads which are nuclear, chemical or biological. He spoke also of the term "need-to-know", which is a familiar one to me. I hope that pressure in Parliament or in the media will not cause the Government to go further in the openness which they have so far established. I trust that heed will be taken of the noble Lord's words on that issue.

In case there is any misunderstanding, I repeat that I believe it is vital that secrecy be preserved. My noble friend Lord Bethell also said that. I hope that I made that clear at the beginning and the end of my opening speech. I am glad that the noble Lord, Lord Knights, decided to speak. He added a dimension to the debate with his special police experience. I hope that he will take part in the deliberations on the Security Service Bill when it comes before us after Easter.

I am especially grateful to my noble and learned friend Lord Howe of Aberavon, who made observations about the new parliamentary committee, of which he is a member—.the only one from this House. He spoke also of the essential ring of secrecy which has to be maintained.

I regard it as a compliment that the noble Lord, Lord Richard, the Leader of the Opposition has taken part in the debate. He took part also in debates on the earlier legislation. He made some very good points, so he need not worry about the others. I hope that he will bring his interest and knowledge to bear on the Security Service Bill when it is before us.

I am grateful to my noble friend the Minister. He had the task of replying to the debate and responding to points when he could do so without disturbing the veil of secrecy, which is a delicate operation. We have made suggestions during the debate. I did not expect or wish any reply to be made which would touch upon operations. I welcome my noble friend's statements about the need for the public to be reassured as to the general legality and accountability of the services. I am grateful to him for the considered reply he gave to the debate. I beg leave to withdraw my Motion for Papers.

Motion for Papers, by leave, withdrawn.