§ 9.25 p.m.
§ Lord Williams of Mostyn rose to move, That the draft scheme laid before the House on 27th November be approved [15th Report from the Joint Committee.]
§ Since 1st July of this year an ex gratia scheme has been in place covering payments to those who have chosen to hand in their small-calibre pistols rather than await the passing of the new Act. To date, over 26,000 of these firearms have been given up, in addition to the 116,000 large-calibre handguns that were surrendered in the three-month period from 1st July. Over £27.6 million has already been paid out from the scheme. Of course, the final figure will be higher when the remaining claims and ex gratia applications have been processed.
§ The scheme we are considering today is virtually identical to the ex gratia scheme. We have given assurances that those who chose to surrender their small-calibre pistols voluntarily under the ex gratia scheme would not be disadvantaged compared with those who have waited to surrender their pistols under the formal scheme. That is why the two schemes must be consistent.
§ We estimate that no more than 10,000 pistols are still held lawfully throughout England, Wales and Scotland. This is a little under 200 firearms per police force. The police assessment is that this number of firearms can be 600 processed within one month, and we have therefore set the surrender period as 1st to 28th February 1998. All the necessary documents can be sent out by police forces in good time to potential claimants. In setting February as the hand-in period, we did not forget that the second anniversary of the Dunblane tragedy falls on 13th March.
§ The scheme itself will operate in the same way as the main compensation scheme already agreed by this House on 9th June. Before the hand-in period begins, certificate holders and dealers will receive full details of the new scheme together with application forms and advice on where and when to surrender their weapons. They must complete the appropriate claim form in respect of their weapons and equipment and hand this to the police at the time of surrender. Individuals will have a choice of three options. They may choose to accept a flat rate of £100 for their weapon. Alternatively, they may choose a standard rate for their weapon from the list of published values at Annex A for the most commonly held pistols. If they do not wish to accept the flat rate payment, and if their gun is either not on the list at Annex A or is markedly different from those that are on the list, they may choose the third option. This means a submission of claim, supported by an independent valuation or other evidence corroborating the value of the items surrendered. An extract or copy from a published source as at 16th October 1996 would often be acceptable and therefore an individual valuation will not be necessary in every case.
§ Similar arrangements will apply to dealers. They will be able to claim under any of the three options. They will be able to claim under the third option even though their stock may already be listed at Annex A.
§ The firearms must be handed over to a designated police station, as specified by the relevant chief constable. Special arrangements will be made with dealers because of the number of weapons they may have in stock.
§ Similar arrangements will apply to ancillary equipment which can only be used in connection with the pistols. The corresponding values are set out in Annexes B, C and D of the draft scheme. This is in accordance with the requirements of Section 17 of the 1997 Act (and Section 16 in respect of expanding ammunition) as amended by the latest Act. As under the previous scheme, this equipment will not itself become prohibited but the Government accept that where it cannot be put to any other use, such as with rifles, then compensation should be paid.
§ The claim forms will initially be checked by the police who will then send them to the Firearms Compensation Section of the Home Office for processing.
§ There are two points of detail in the scheme that I should draw to the attention of the House. First, two operative dates are mentioned in the scheme: 14th May 1997 (for possession of the firearms or equipment on the date of the Queen's Speech when the Government formally announced their intention to ban small-calibre pistols) and 16th October 1996 (for the values at the 601 time when the previous Government announced their intention to ban large-calibre handguns). When calculating the values of small-calibre pistols for the ex gratia scheme it was agreed to use the same October 1996 date because values for all handguns generally fell from that point. Taking the values as at 14th May 1997 could have given rise to criticism for treating shooters unfairly. Taking the earlier date is, we believe, in the best interests of shooters. I explained the reason to the House on 9th June.
§ For the sake of precision we have added three categories of ancillary equipment to the scheme: speed-loaders, speed-loader pouches and quantities of spare parts held by registered dealers. Component parts which have to be held on a firearm certificate, such as barrels and cylinders, were already in the ex gratia scheme.
§ We have decided to add these three categories because they were appended to the earlier compensation scheme after it was approved, but on an ex gratia basis. These three categories were genuine oversights and as payments are being made on them under the previous scheme it is only right that they should be included specifically in the new scheme and that the House should have the most up-to-date information possible available to it today.
§ We have not added additional pistol makes to the annexes because of the need to keep the schemes consistent and not to prejudice those who had chosen to hand in their pistols early. Any pistol not listed will need to be claimed for under options A or C. I have already indicated that an extract from a published source on or before 16th October 1996 will generally be acceptable as evidence of value and an individual valuation will not always be necessary.
§ I wish publicly to thank the people working in the Firearms Compensation Section who have moved a mountain of paperwork so that people get their compensation as quickly as possible. I regret that there has been some attempt to undermine confidence and to criticise the rate at which claims under the large-calibre scheme are being dealt with.
§ I am able to tell the House about the progress that has been made. As at 12th December, 39,896 claims have been received, and 23,183 payments have been made, to a total value of £27.6 million. Most claims under options A and B will have been dealt with before the end of March, and regular payments on option C claims will have begun by then. Some dealers who have claimed under option C will already have received at least an interim payment by now. The additional new claims in respect of up to 10,000 guns will add to the current pressures upon the FCS but the processes and procedures involved in dealing with these claims will be no different from those already in train.
§ There were teething troubles with the purpose-built FCS computer system which slowed down the initial processing rate. We hope that those teething problems have been completely overcome. Staff are working hard to deal with claims as quickly as possible. Weekend overtime is being worked and measures have been taken 602 to boost the number of staff engaged in the primary task of examining claims. The work is not simply the automatic payment of claims when received. All the claims have to be examined carefully to ensure that the items surrendered are eligible for compensation under the scheme and that the correct scale of payment is made. We are committed to keeping up the pace of processing the claims but we cannot lose sight of the need to maintain the proper checks and balances to ensure correct payment and prevent fraud.
§ It is not a simple rubber-stamping exercise. A great many claims—unfortunately, about 35 per cent. of those received—have been wrongly completed. Common mistakes include descriptions of items not matching the code numbers on the published list; lack of details under certain headings, such as "specialised tools"; and payment details, such as bank account numbers, are sometimes wrong. If 35 per cent. of forms are not properly completed, that adds to overall delay and takes up valuable staff time to resolve. Unfortunately, a number of cases of possible fraud have come to light and are presently the subject of criminal investigations. I cannot give details of those cases, for obvious reasons. But we are dealing with public money and we have to be careful about the mechanisms in place to control and avoid fraud.
§ We are looking at ways and means of improving the throughput of cases. There have been improvements. In July the total number of payments was only 351 because of the problems with the computer system. In August the number of payments rose to 2,602 and in September to 4,091. This improvement has continued. The average number of weekly payments is now running at 1,400.
§ We are keeping the promise of compensation which is reasonable and which is paid out in order to fulfil our promise to the British public to end private ownership of handguns. The scheme is no more and no less than the ex gratia scheme that has been in place since 1st July. There have been no major criticisms of that scheme which, we believe, properly compensates the owners of small calibre pistols and related equipment. I commend the scheme to the House.
§ Moved, That the draft scheme laid before the House on 27th November be approved [15th Report from the Joint Committee].—(Lord Williams of Mostyn.)
§ Lord Henley
My Lords, I am grateful to the noble Lord for agreeing to take this order tonight rather than on Thursday, which might have caused both myself and, I suspect, the noble Lord a little more inconvenience.
There are one or two questions that I wish to put to the noble Lord. He has dealt with some of them in his admirable opening remarks about this order. They are particularly my concerns about delays and the timescales in dealing with claims. Perhaps he will elaborate a little on where we are precisely at the moment in terms of how long it is taking to deal with particular claims. The noble Lord seemed to imply that as regards claims being dealt with under Options A and B there were relatively few problems. It was cases under Option C where matters were more complicated.
603 Having said that, would it be worth considering leaving Option A and B payments to simple across-the-counter payments, to be dealt with presumably by the police, rather than coming to the FCS and therefore taking up Home Office time, thereby leaving its officials more time to deal with Option C cases? It may be too late in the day to move to such a system, but it might have been an approach considered earlier on.
In the light of the fact that there are delays, about which we have heard anecdotal evidence, and more than that, will the Government consider whether there is a case for paying interest on late payments, particularly those where the delay is more than the 30 days (which we suggested as a maximum when the Bill was going through Parliament), let alone the 30 days which the Government have always put forward as the proper limit for business to observe?
I make that point because, as I believe will be the case in the Bill coming before another place relatively soon, business late payments will be subject to interest, as is the case with those of us who occasionally manage to pay our income tax late. It is possible to be charged a level of interest, just as the Revenue occasionally pays a degree of interest on its late payments when making refunds for overpayments. There is quite a strong case for the Government to consider whether interest ought to be paid, particularly as regards those cases where through no fault of the applicant there are delays in the department. I do not want to criticise the department because it has had to deal with a great number of applications coming through the system, some of which have been complicated. But it is a case that the Government should consider seriously.
I have one further question. I do not know whether the noble Lord will be able to answer it at the moment. He kindly wrote to me on 4th December and told me that about 26,000 small calibre pistols had been handed in and another 10,000 were due to come forward. Of those 26,000, I shall be interested to know how many claims have come through to the FCS already and how many are still at the different police stations throughout the country. I would like to know whether there are delays there before the claims are reaching the Firearms Compensation Section. That might be a process that can be speeded up. If the noble Lord does not have the answer at the moment, I shall be more than happy for him to write to me in due course.
§ Lord Williams of Mostyn
My Lords, I am most grateful to the noble Lord, as always, for his courteous approach. I shall obtain the up-to-date figure for the 26,000 and I shall write to the noble Lord as he invited me to do. I try to keep him fully in the picture. But the figure I have is the one that I gave him up to 4th December. I shall write to him as regards his last question.
The Option A and B claims have already been submitted to the FCS and therefore there would be a further delay if they were then sent back to the police. As the noble Lord implied, and I believe, understands, the scheme has been specifically set up in the way that 604 the FCS is operating it. Therefore, it would be a waste of its time and a hopelessly inefficient use of police time if we went that way.
On the question of interest, I must point out that these are not ordinary business transactions. We cannot make payment immediately on receipt of a claim. Claims have to be fully considered. We do not take the view that adding interest to the compensation payment is appropriate. Indeed, one takes the view—perhaps this is not susceptible to argument because it is simply the view that has been taken—that we do not believe that it would be a justifiable further drain on public funds because we do not think that we have been unreasonable about the level of compensation.
I thank the noble Lord generally for his approach. I have tried to reciprocate it by, for instance, conceding the amendment that he put forward, having taken on, as it were, the baton of civilisation from the noble Baroness, Lady B latch, in respect of the nature of the compensation scheme. I cannot stress enough that I appreciate the way in which he deals with such matters.
§ On Question, Motion agreed to.