Lords Sitting of 28 November 2001

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Blackburn.

Russia: Nuclear Non-proliferation Programme
Lord Hunt of Chesterton Lord Hunt of Chesterton asked Her Majesty's Government:
How they are working with the Russian Government to ensure that Russian weapons and technical and scientific capabilities do not become available to international terrorist organisations and enemy countries.
The Minister for Trade (Baroness Symons of Vernham Dean): My Lords, the Government have allocated an Interdepartmental budget of £83·8 million for the years 2001–04 to projects to tackle the environmental, security and proliferation threats posed by the former Soviet Union's nuclear legacy. That includes a proportion of a £70 million UK contribution over 10 years to a US/Russia plutonium disposal programme. We are also spending up to £12 million in the same period on chemical and biological non-proliferation projects in Russia.
The proliferation risk posed by Russian weapon scientists and technicians is also taken seriously by the Russian Government and the UK and we co-ordinate our response with that of Russian, EU and United States partners.
Lord Hunt of Chesterton: My Lords, I thank the Minister for her reply. Does she agree that, as I saw on a recent visit to Russia, compared to France, Germany and the United States, our support for Russian defence and other areas of science and technology is not as great as theirs, and that increasing that would be mutually beneficial to the UK and to Russia?
Baroness Symons of Vernham Dean: My Lords, I cannot agree with that. I can agree possibly in relation to the United States, which is a much more wealthy country than the United Kingdom. However, I should tell the noble Lord that when I made reference to the £70 million contribution over a 10-year period to assist with the conversion of Russian weapon-grade plutonium into non-weapon usable form, the United Kingdom is the second largest contributor to that programme after the United States. We are making a greater contribution than either France or Germany. We are also committed to spending £3 million over the next three years on projects which are designed to ensure that nuclear scientists and technicians are not
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tempted to sell their skills to foreign regimes where they might do some damage. In that respect we contribute more than either France or Germany.
Lord Jenkin of Roding: My Lords, are the Government satisfied that the sums which they are making available are reaching their intended targets? At a briefing for parliamentarians last year given by the British Nuclear Forum, there was widespread criticism of the fact that relatively small parts of the total programme were reaching their intended purposes, as well as criticism of the falling United Kingdom contribution to this effort. Does the Minister accept that there is a good deal to he done if we are to be satisfied that these dangerous materials will not fall into the hands of terrorists?
Baroness Symons of Vernham Dean: My Lords, I certainly accept that this is a serious problem. However, I would point out that among our European partners, the United Kingdom is not only playing its part; we are putting a great deal of money into the effort. There are responsibilities that devolve to Russia. The noble Lord will know that as a member of the Nuclear Suppliers Group and the Zangger Committee, Russia is committed to ensuring that transfers of nuclear materials and technology do not fall into the wrong hands. We have regular bilateral talks with the Russians on non-proliferation issues and shall continue to do so.
Baroness Park of Monmouth: My Lords, can the Minister tell the House what arrangements there have been for inspecting sites such as those where chemical weapons are held to ensure that the money is being used for the purpose it was given? I have heard from an authoritative source that the roads have improved greatly in that area and that a number of interesting and splendid houses have been built for party functionaries. However, there is not much evidence that anyone has done anything about removing chemical weapons or, indeed, looking after the unfortunate villagers who have suffered. What arrangements are there for inspection to prove that the money is being spent in the right way?
Baroness Symons of Vernham Dean: My Lords, at present we are discussing a further agreement with the Russians in respect of the type of problems raised by the noble Baroness. Perhaps I may suggest to her that if she has evidence—I am sure she has if she says that—she approaches me privately outside the Chamber. I would be happy to learn of any concerns she has and to act upon them. However, it is probably best that we do that privately after Question Time.
Baroness Williams of Crosby: My Lords, can the Minister tell the House whether the United States programme, entitled Nunn-Lugar, is continuing? In particular, can she say whether some of the efforts being made between the United States and the United Kingdom to bring contracts to the Russian scientific establishment to ensure that it looks for respectable and non-dangerous employment are continuing?
Baroness Symons of Vernham Dean: My Lords, the programmes I mentioned a moment ago, to which the United Kingdom contributes £3 million, involve also the European Union. As the noble Baroness indicated, there are also programmes which involve the United States. This is an area where constant vigilance is necessary. This matter would have been discussed between the United States and Russia—most recently between President Putin and President Bush—in discussions about their future nuclear relationship. They are now considering a new framework to discuss the particular threats of the 21st century. That is being done in the spirit of partners and friends, which is a constructive way to reach agreement. The noble Baroness can rest assured that in relation to scientists the United States is as engaged—probably rather more so in financial terms—as the United Kingdom.
Lord Berkeley: My Lords, can my noble friend tell the House whether any of the missile grade material from Russia could be reprocessed at the new plant in Sellafield which has just been given permission to operate?
Baroness Symons of Vernham Dean: My Lords, I am afraid that I cannot answer that question, but I am sure that there are those who can. I shall do my best to find out and write to the noble Lord.
Lord Howell of Guildford: My Lords, the noble Baroness is quite right that the Russians are well aware of the problem. Will she agree that her noble friend Lord Hunt has raised an issue of the utmost and immediate seriousness? In addition, there are as many as 12 states, quite aside from the terrorist networks, which are trying to purchase illegally procured nuclear and other toxic materials from ex-Soviet Union and ex-Russian stocks. Will she agree that that is a matter that is almost as urgent as dealing with the problems of the Al'Qaeda network in Afghanistan and elsewhere? Will she further agree that the great coalition should be turning its mind today to new attempts and new arrangements to try to curb the dissemination of that material before the next terrorist horror occurs?
Baroness Symons of Vernham Dean: My Lords, I shall not confirm the number of states which may be trying to purchase material from Russia. As the noble Lord would expect, there is a certain amount of information on these matters in intelligence circles. I am sure that the noble Lord would not want to press me on numbers or the states involved.
I agree with the noble Lord that my noble friend has raised a very important point. I hope that the information that I have given to the House has reassured noble Lords that the United Kingdom is playing a leading part in Europe in dealing not only with the material that might be the subject of such purchases from states that we would not want to make such purchases, but also with the very important question of what happens to the professional expertise of the scientists. We need to concentrate on the people as well as on the material concerns.

Police Service of Northern Ireland
2.44 p.m.
Lord Rogan Lord Rogan asked Her Majesty's Government:
What conclusions they have drawn from the first recruitment campaign for the Police Service of Northern Ireland.
The Lord Privy Seal (Lord Williams of Mostyn): My Lords, the first recruitment campaign for the Police Service of Northern Ireland has been an overwhelming success. It has attracted over 7,500 applicants and will enable the appointment of about 300 new recruits on a 50:50 basis. That exceptional level of interest has clearly shown that the people of Northern Ireland are eager for policing to move forward.
Lord Rogan: My Lords, I thank the noble and learned Lord for his reply. But is he aware that my colleagues on these Benches and in another place have been inundated by complaints from people regarding the methods used in this recruitment process? Will he confirm that two recruits not treated as Roman Catholics under the terms of the Police (Northern Ireland) Act 2000 are to be told that they cannot begin training because two Roman Catholic recruits have since withdrawn? Will he accept that while my party supports the Government's goal of creating a police service in Northern Ireland more representative of the society as a whole, we can never accept their decision to resort to discriminatory practices—especially religious discrimination—in order to bring that about?
Lord Williams of Mostyn: My Lords, the quality of those who have applied has been gratifyingly high. They have to pass nine competency tests as opposed to six on the mainland. I do not know the details of particular individuals. It would probably be invidious to comment on them since those are essentially operational matters for the Chief Constable.
On the question of discrimination, the Patten report suggested—I am paraphrasing fairly I think—that in order to have a generally accepted police service one should look for a significantly higher number of recruits from the Roman Catholic community. That figure has risen quite slowly over the past years, from about 7.3 per cent to 8.4 per cent. I think that the majority of opinion would be looking for a significantly higher contribution from the Roman Catholic community.
Lord Campbell of Alloway: My Lords, what progress has been made on the restoration of the rule of law with regard to punishment beatings and so forth in Northern Ireland?
Lord Williams of Mostyn: My Lords, that is undoubtedly a continuing struggle. Everyone who has had any contact with the police service in Northern Ireland knows how dedicated it has been. But no police service can operate without the full-hearted support of

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all sections of the community. That is part of the reason why we want the reforms to go forward as quickly and as fruitfully as possible.
Lord Smith of Clifton: My Lords, does the Minister agree that, while there will undoubtedly be one or two hiccups, the figures that he has just announced actually demonstrate a remarkably smooth transition and a working of the new recruitment policy? Does he further agree that it is particularly welcome to have the support of the SDLP and of the Roman Catholic hierarchy in encouraging members of the Catholic community to apply in such numbers?
Lord Williams of Mostyn: My Lords, I absolutely agree with the noble Lord's question. With regard to his second point, it is an extremely significant step forward. I do not think that one can begin to underestimate the fact that the Roman Catholic Church and its hierarchy and the SDLP have had the courage to take this very important public step. I pay particular tribute to the courage of those from the Roman Catholic community who will be in a very public front line. They know the dangers; they are willing to offer themselves for public service; and we should support them.
Lord Dubs: My Lords, does my noble and learned friend agree that not only should we be delighted that the Irish Government, the American Government, the Catholic Church and the SDLP have all given their support to these new proposals but also that the Chief Constable of Northern Ireland has led the way in getting the police to co-operate with the new system of policing? That is in the interest of all the people of Northern Ireland.
Lord Williams of Mostyn: My Lords, Sir Ronnie Flanagan is another very remarkable public servant. He has had to demonstrate the force of the argument to a large number of his colleagues who have had colleagues murdered and who still work alongside those whose relatives have been murdered. These are all very significant steps. I repeat that we should welcome them with a full heart.
Lord Hylton: My Lords, can the noble and learned Lord tell us how many requests to transfer into the Northern Ireland police service have been received from other police services in the English-speaking world in the past year? Would not such transfers be very helpful in balancing the police in Northern Ireland?
Lord Williams of Mostyn: My Lords, I made inquiries about the figures, thinking that that question might be asked. In fact, I am not able to give specific figures because, until the final vetting stage, no inquiry is made about previous employment. That is appropriate. But I can say as a matter of fact that there have been applicants not only from the rest of the United Kingdom but from other Commonwealth countries. I agree with the noble Lord that that is extremely gratifying.
Lord Laird: My Lords, will the Minister give us an undertaking that all successful candidates in the first recruitment campaign for the police service have been able to fulfil all the minimum qualifications?
Lord Williams of Mostyn: Yes, my Lords.
Baroness Nicol: My Lords, is my noble and learned friend aware that certain leading members of the new force feel that they are under-resourced in some areas? For example, they suggest that their information technology system is fragmented and needs updating. I do not expect my noble and learned friend to have the answer to my question now, but will he undertake to look into the matter?
Lord Williams of Mostyn: My Lords, certainly. I do not know of any police force in the United Kingdom that does not have some complaint about under-resourcing, as I am sure Mr Blunkett would be the first to testify.

New Partnership for Africa's Development
2.51 p.m.
Lord Blaker Lord Blaker asked Her Majesty's Government:
What steps they are taking to carry forward the proposal made by the Prime Minister in his speech to the Labour Party Conference in October for a partnership for Africa between the developed and the developing world based on the New Africa Initiative.
The Parliamentary Under-Secretary of State, Foreign and Commonwealth Office (Baroness Amos): My Lords, the Government have warmly welcomed the political will demonstrated by the New Partnership for Africa's Development. At the G8 summit in Genoa in July, leaders agreed to forge a new partnership to address issues crucial to African development. The G8 agreed to develop a concrete action to be approved at its summit in Canada next year. As the Prime Minister's personal representative, last month I participated in the first of a series of meetings to develop the plan.
Lord Blaker: My Lords, does the Minister recall that in a speech the Prime Minister held out a vision of a partnership to create an Africa that was democratic, and in which there was to be no excuse for abuses of human rights? He said that that could he achieved,
"if we find the will."
Where is the will in relation to Zimbabwe, the government of which are creating a humanitarian, political and economic ruin? If, as seems probable, the forthcoming elections in Zimbabwe are unfree and unfair, will that not leave an ugly stain on the Prime Minister's vision?
Baroness Amos: My Lords, we are committed to working with African partners on a new vision. The important thing about the New Partnership for Africa's Development is the commitment by African leaders themselves to tackle such issues and to demonstrate political will and leadership.
With respect to Zimbabwe, the noble Lord well knows, because I said this the last time that I was asked about Zimbabwe, that we have worked tirelessly to bring together an international consensus on Zimbabwe involving the Commonwealth, the Southern African Development Community, the European Union, the United States and other partners. The Government of Zimbabwe want to make the problem a bilateral one between Britain and Zimbabwe. It is not so. International concern has been expressed. We continue to press the Government of Zimbabwe to ensure that election observers are allowed into the country. IfZimbabwe does not do so, it appears that it will be breaking SADC rules and southern African heads of government will also have to deal with the problem.
Baroness Rawlings: My Lords, can the noble Baroness confirm whether or not the New Africa Initiative will mean that a larger percentage of UK bilateral aid to Africa will be directed to African governments and away from non-governmental organisations and charities that work in Africa?
Baroness Amos: My Lords, the noble Baroness may be aware that since 1997, we have increased our bilateral development spending in Africa from £450 million per year to £778 million in 2000–01. That is linked to our strong commitment to work towards the eradication of world poverty. With respect to the ways in which we deliver that spending, the noble Baroness will be aware that our commitment is to work with governments who are themselves committed to spending money on sectors such as health and education. We take a sector-wide approach, because we want to build capacity and ensure sustainability.
Baroness Williams of Crosby: My Lords, we on these Benches congratulate the Minister on the New Africa Initiative. Will she tell us about controls over the movement of diamonds from Botswana, Sierra Leone and elsewhere within Africa, to ensure that they are now passing through proper, legal channels and benefiting the African producers?
Baroness Amos: My Lords, the noble Baroness will be aware that the Kimberley process has been in hand considering the exploitation of diamonds in the African context. We have an integrated approach, especially in considering conflict in Africa. We will continue that approach. The noble Baroness will be pleased to know that African countries have themselves identified as a priority dealing with conflict and the exploitation of resources in conflict situations.
Lord Hunt of Chesterton: My Lords, does my noble friend agree that there are some encouraging signs in
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Africa, especially in the development of the environment? Does she agree that Nigeria has played an important role, as have NGOs and the United Nations Environmental Programme?
Baroness Amos: My Lords, I agree. The issue of sustainable development—in particular, protection of the environment—is an important element of the strategy.
Baroness Knight of Collingtree: My Lords—
Lord Marsh: My Lords—
Lord Williams of Mostyn: My Lords, it is the turn of the Cross Benches.
Lord Marsh: My Lords, can the Minister envisage any circumstances in which the Government may take direct action to bring pressure to change Mr Mugabe's long-standing total contempt for the international community by his illegal actions?
Baroness Amos: My Lords, the noble Lord may be aware that last week, following our concern about journalists in Zimbabwe being identified as terrorists by President Mugabe, we sent a strong message to his government through our High Commissioner. We are working in a variety of ways through a variety of forums. Unilateral action by the United Kingdom in this area will be meaningless. We have sought to work in partnership not only with southern African and other African heads of state but with our Commonwealth and European Union partners, because this issue is international, not bilateral.
Baroness Knight of Collingtree: My Lords, have the Government taken note of the fact that almost daily there are bloody and wicked murders of innocent white farmers in Zimbabwe? Apart from the question of elections, what action has been taken to demonstrate to that government that the Government, as a member of the Commonwealth, regards that practice with abhorrence?
Baroness Amos: My Lords, not only have the Government taken note of that point, we have made strong representations on it.

SNCF Terminal Calais
2.59 p.m.
Lord Berkeley Lord Berkeley asked Her Majesty's Government:
Whether they have discussed with the French Government the provision of a joint military force at the SNCF terminal in Calais to protect railway workers from attack and to enable rail freight services to restart.
Lord Filkin: My Lords, we are concerned about the situation, hut we think that effective civil rather than military action is required for us to improve physical security. We are pressing French authorities to act urgently.
Lord Berkeley: My Lords, I am grateful to my noble friend for that Answer. I have two questions to ask him. First, he has ruled out military involvement, but does he agree that last year, when the lorry drivers were blocking the fuel depots of this country, military involvement was certainly on the cards? The Government had a plan to implement that.
Secondly, does he agree that, if a government want to keep people out of their country, they build the fence and patrol it? In this case they have decided that the fence should be in Calais. However, does it not remain the responsibility of our Government to sort out the fence rather than, as I understand to be the case, the Prime Minister writing to Mr Jospin telling him that he should build the fence and that if he does not do so we shall fine his railway when it brings in illegal immigrants?
Lord Filkin: My Lords, I shall not comment in detail on what may or may not have happened with the petrol crisis last year. However, there is a world of difference between considering military action in the UK and the deployment of British Armed Forces in another European country. As I suggested, the situation requires powerful and effective civil policing, backed up by effective security measures.
As regards the noble Lord's second point, the matter is for SNCF and the French authorities. Our police have no powers of trespass and arrest within French territory. We are co-operating with the French but are urging them to treat the issue with considerable importance and to take much speedier action.
Lord Bradshaw: My Lords, we should by now be seeing 10 million tonnes of freight go through the Channel Tunnel each year. We are at about 2.75 per cent and that is falling rapidly. There are two reasons for that: first, the inability of the Government to deal with SNCF, which is thoroughly inefficient; and, secondly, the inability of the Government to deal with the problem of illegal immigrants. When will we get some effective action on both issues?
Lord Filkin: My Lords, that question invites me to roll two large issues together—and as regards this problem they are rolled together to some extent. In relation to the SNCF issue, the Prime Minister wrote to Lionel Jospin on 16th November stating how seriously we considered the matter. Tomorrow there will he the UK summit between France and the United Kingdom when we expect the Prime Minister to raise the matter again with Lionel Jospin. On 3rd December there will be a meeting with the head of security of SNCF when we will again be pressing it to build the fence it has talked about since May in order to provide
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effective security. Finally, the European Union wrote to France about the regulations relating to the free movement of goods and the infringement.
Baroness Hanham: My Lords, is the Minister aware that United Kingdom operators are losing about £8 million a week as a result of the action that has been taken by SNCF? Will he give the House some information about the compensation which will be sought, and from whom, for those operators in future?
Lord Filkin: My Lords, no, I do not have the detailed figures relating to the potential amount of business that is being lost. However, we view the matter with considerable concern. Government policy is clearly to try to increase rail freight and to increase international rail freight. We would like to reach 6 per cent rather than the current figure which the noble Lord, Lord Bradshaw, mentioned.
I shall look into the matter of compensation and come back to the noble Baroness. However, I imagine that the redress should be against a breach of contract by SNCF rather than the UK Government.
Lord Corbett of Castle Vale: My Lords, although security at this point and elsewhere on the coast of France is important, is not the real answer to press ahead to reach agreement with our EU partners for a common asylum policy and for understandable policies relating to the economic migration into the countries of the European Community? Can my noble friend say what progress is being made on that?
Lord Filkin: My Lords, yes, I strongly agree. The Government's view is that the Dublin convention has not worked in the way we hoped and expected. We are pressing other European countries rapidly to bring the matter on to the agenda. There are initial discussions about that but we are still in the early stages. It is crucial that that convention is revised. In the mean time, in this situation we must rely on physical security measures and effective police action at the French end. Where that has been taken at Eurotunnel PLC and through the Channel ferries, it has been effective. We are now seeing displacement on to SNCF's site and if it had hardened that site when it said it intended to do so we would not be experiencing the scale of problem we are now seeing.

Business
3.4 p.m.
Lord Carter: My Lords, at a convenient moment after 3.30 p.m., my noble friend Lady Hollis of Heigham will, with the leave of the House, repeat a Statement which is being made in another place on benefits uprating.

State Pension Credit Bill [H.L.]
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Hollis of Heigham): My Lords, I beg to introduce a Bill to make provision for and in connection with a new social security benefit called state pension credit and to amend Section 47(1) of the Pension Schemes Act 1993. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read a first time.—(Baroness Hollis of Heigham.)
On Question, Bill read a first time, and to be printed.

Anti-terrorism, Crime and Security Bill
3.5 p.m.
The Minister of State, Home Office (Lord Rooker): My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee.—(Lord Rooker.)
On Question, Motion agreed to.
House in Committee accordingly.
[The PRINCIPAL DEPUTY CHAIRMAN OF COMMITTEES in the Chair.]
Clause 1 [Forfeiture of terrorist
cash]:
Lord Kingsland Lord Kingsland moved Amendment No. 1:
Page 1, line 9, leave out "a magistrates' court" and insert "the High Court"
The noble Lord said: In moving Amendment No. 1, I shall speak also to Amendments Nos. 2 and 16. As regards Amendment No. 3, having read Amendment No. 4 tabled by the noble Lord, Lord Goodhart, I do not intend to move my own.
The Committee stage of the Bill has followed Second Reading more swiftly than is customary. There may be occasions on which amendments are moved which bear no relation whatever to speeches made from the Opposition Front Bench. I simply beg the pardon of Members of the Committee if that happens.
As regards Amendment No. 1, under the powers set out in Schedule 1, a police officer can apply to the magistrates' court for restraint of cash which is expected to be associated with, or furthers, terrorist activities. The order is for a maximum of three months, extendable for two years. When the investigations are complete, an application can be made to the magistrates' court for forfeiture. There is a right of appeal of the forfeiture order to the Crown Court by any aggrieved person within 30 days.
We accept that that is a valuable weapon in our armoury to defeat terrorism because it is self-evident that, without funding, terrorism cannot flourish. We therefore support the extension of that power. However, a magistrates' court will be faced with difficult questions of fact and law in determining whether or not cash should be forfeited. Before making the forfeiture order, the magistrates will have to be satisfied that the cash was intended to be used for
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the purposes of terrorism, or consisted of resources of a proscribed organisation, or was or represented property obtained through terrorism. These issues of fact could be very complex, difficult to prove and hard to understand. Moreover, the law that applies to the proceedings would be essentially civil in nature rather than criminal. In our submission, a magistrates' court is not the right place to determine these issues.
We believe that the right court to determine these issues is the High Court. The High Court is, of course, a civil court and has the necessary expertise to deal with the difficult issues which could arise in any application for an order that cash he forfeited. A forfeiture order is a matter which should be dealt with by senior judges with many years' experience of financial litigation.
Applications for restraint orders are currently heard in the High Court. The Proceeds of Crime Bill would change the jurisdiction for restraint orders to the Crown Court. Lay benches and district judges, however, will have no experience of restraint orders which are complex matters of civil proprietorial rights. We submit that these complex, sensitive matters must be dealt with in the High Court. I have dealt with Amendments Nos. 1 and 16. I have surrendered Amendment No. 3 to the noble Lord, Lord Goodhart. I beg to move.
Lord Thomas of Gresford: In rising to support the noble Lord, perhaps I may also speak to Amendment No. 2. Since Committee stage follows closely on Second Reading and yesterday I said all that I wanted to say in relation to the difficulties that a magistrates' court will face in dealing with these problems, I shall not repeat myself. It is probable that those who drafted this legislation had in mind confiscation orders in drugs legislation where applications are made to magistrates' courts for the recovery of assets. That matter was considered by the Runciman report in 1994 which followed an independent inquiry into the Misuse of Drugs Act 1971. Paragraph 53 of that report states:
"At present, except where a receiver is appointed by the High Court, the magistrates' courts are responsible for recovering the assets named in a confiscation order. They may find themselves called upon to enforce an order in an amount of several million pounds with a default term of up to 10 years. These are amounts and sentences wholly inconsistent with the maximum penalties that a magistrates' court can impose on conviction, and we doubt whether they are the appropriate jurisdiction for the task. We therefore recommend that the responsibility for enforcement should lie with the Crown Court not with the magistrates' courts".
The report made the strong recommendation that in relation to drugs legislation the magistrates' court was not the suitable venue.
Under the Bill this is a civil procedure which involves difficult areas of law. I believe that to require the High Court to intervene is to put it a little high. I do not believe that these are issues which should take up the valuable time of the High Court judiciary; instead, they should occupy the valuable time of the circuit judge of the county court who has complete expertise

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in civil matters and should be able to resolve these questions. That is why I have tabled Amendment No. 2.
Lord Renton: I rise to support Amendment No. 1 and with it Amendment No. 16. I agree with the noble Lord, Lord Thomas of Gresford, that it would be better to give jurisdiction to the county court than the magistrates' court. But here we are breaking new ground in law in a very important and complex field. I would have thought that it was essentially a matter for the High Court. To allow the magistrates' court to decide the matter would be unusual. Magistrates' courts very rarely deal with civil matters. Although they deal with licences for intoxicating liquor, which can be described as civil proceedings, they are quite simple matters. To allow magistrates' courts to deal with civil proceedings in a new, complex and vital area of the kind referred to in the Bill, especially forfeiture of terrorist cash, would be unusual. I do not believe that it would have the confidence of the public. I am sure that my noble friends are right to suggest that the High Court should have jurisdiction.
The Earl of Mar and Kellie: The noble Lord, Lord Kingsland, said that he would not move Amendment No. 3, but I should like to speak to it since my name appears next to the amendment. This is one of a number of amendments proposed by the Law Society of Scotland which I believe will help to ensure that this emergency legislation is both Scots law-proof and devolution-proof. Amendment No. 3 is intended to probe why the code of practice needs to be modified when the Terrorism Act 2000, of which it is part, passed into law so recently.
Lord Elton: Like my noble friend Lord Kingsland, I struggle to keep up with developments. I apologise if I have misunderstood the position, but I should like to ask the noble Lord who is to reply for clarification. Is it not the case that the Proceeds of Crime Bill is a government measure and there proceedings equivalent to those with which we are now concerned—terrorist cash—will take place in the High Court? What is the reason for dealing with terrorist cash, which may be as large or even greater, in a very much lower court with normally far less discretion? Even if the reason is the need for expedition, I believe that the Committee will hesitate before giving to magistrates a complex procedure which may have very considerable financial impact and may finish up in the wrong place.
Baroness Carnegy of Lour: At Second Reading yesterday I asked the Government to give an assurance that they would be in constant touch with the Scottish Executive on the drafting of the Bill. This matter is an example of what I spoke about yesterday. If on examination, or by persuasion, the Government accepted that the High Court was the suitable venue, the question would arise whether in Scotland the right place was the sheriff court, as the Attorney-General readily appreciates.
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In all these matters, when one is considering in this Bill which court is the right forum for decisions to be made, very careful attention should be paid to the drafting so there is no confusion in haste in reading across to the Scots system. If I spot it when the Committee comes to it I shall ask about the job which has been given to the Procurator-fiscal in Scotland. I do not quite understand the position. However, believe that what I have said arises in relation to Amendment No. 1. If I can have that assurance I shall not continually refer to it, which may be rather tiresome. However, it is an extremely important matter. All the reasons given by previous speakers as to whether jurisdiction should be in the High Court or Crown Court apply equally to whether the sheriff court is the right place.
Viscount Bledisloe: In considering this matter I have looked at some of the matters that the court may have to decide in Part 5 of Schedule 1 to the Bill: property earmarked as terrorist property; tracing property: mixing property and chasing profits. All of those appear to me to be matters of singular legal complexity. Tracing and mixing property are normally matters dealt with in the Chancery Division because mere common lawyers cannot understand them. I should like to ask the Minister whether there is any special definition of "magistrates' court" for this purpose. Does it mean only a particular stipendiary magistrates' court or any magistrates" court? If it means any ordinary magistrates' court, surely there is a second problem in that very seldom can magistrates sit for several consecutive days to try these kinds of matters. To try to solve the questions we have been looking at on a series of single days, with adjournments in between before the court can be reconstituted, is asking the impossible of eminent, worthy laymen used to deciding simple questions of fact.
I do not have any great thoughts as between the High Court and the county court, but, unless the Minister can come up with a convincing answer, one or other of these amendments has to be right.
Lord Rooker: In replying for the first time today, I wish to thank noble Lords and the authorities of the House for the speed with which they have managed to marshal the amendments for the convenience of our debate. I realise the pressure that everyone has been under.
I shall take advice in regard to the noble Viscount's final question. The issues he raised are probably more relevant to the debate on Schedule 1, starting with Amendment No. 5, and I shall deal with them at the appropriate time.
In moving the amendment, the noble Lord, Lord Kingsland, made a case, but, throughout the Bill, the onus is on the Government to give evidence as to why we want to make changes. The cash forfeiture scheme in respect of terrorism is, as the Committee will appreciate, built on a similar scheme in respect of cash related to drugs. That scheme has been in force for a decade and proceedings in relation to drugs-related

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cash have always been held in magistrates' courts. I have no evidence—and none has been adduced today—that there have been any problems in this respect. The procedure has been heavily used—there is no question of a one-off, isolated case—and noble Lords have not adduced any evidence of problems that I should take into account. The issues are fairly straightforward and, therefore, can be placed before a magistrates' court.
If we moved the proceedings to the High Court, in particular, it would undermine the proposed scheme. It would increase expenditure enormously and might cause problems in meeting the important 48-hour deadline. There are some changes in the process of this scheme compared to other schemes, in terms of legal services and so on, but, if the amendment were agreed to, the 48-hour deadline for the first detention hearing would be seriously undermined.
The noble Lord, Lord Renton, said that we were breaking new ground. We are not. The procedure under the Drug Trafficking Act is well used in magistrates' courts. The Terrorism Act 2000 contains cash forfeiture procedures, which also take place in magistrates' courts. So far as concerns the Proceeds of Crime Bill, that is currently passing through another place. At the moment, it contains some 450 clauses, so I am not going to pre-judge what it may be like when it reaches your Lordships' House. That is not a reason for not answering the question, but the issue is covered in another Bill in another place and it will be several months before that Bill arrives here. Unless noble Lords can make out a case, based on evidence, that the present system has not worked in magistrates' courts, I ask the Committee to reject the amendment.
The noble Earl, Lord Mar and Kellie, referred to Amendment No. 3 and to the issue of the modified code of practice under Clause 1(5). The Home Secretary has made drafts of the modified code available and it has been placed in the Libraries of both Houses today. Members will therefore have an opportunity to see the draft code and to comment upon it. The amendment was brought forward because of a concern that the code would not be available before enactment. Quite clearly, that amendment is now unnecessary given the fact that the code is now available in the Libraries of both Houses.
Lord Renton: The Minister mentioned that the Terrorism Act 2000 provides a precedent for the jurisdiction of magistrates' courts. But this Bill has been introduced in quite different and much more serious circumstances than those which arose before the introduction of the Terrorism Act 2000—and, incidentally, from the point of view applying the law, much more complex circumstances than those which arose before that Act. In view of what has happened since 11th September, surely we should look at this matter with fresh minds.
Lord Rooker: We are looking at this matter with fresh minds. Obviously there are substantial changes. For example, cash can be collected from anywhere in
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the country; we are not as confined as we are under the terrorism legislation. In some ways, that adds weight to the fact that the quicker we can get a case to court the better. Therefore, meeting the 48-hour deadline is important. Values have also changed.
However, I do not want to go into the overall aspects of Clause 1 stand part. We are seeking to build on existing procedures; we are not seeking to invent the wheel. We have a well-tried and tested system, which has been operating in magistrates' courts since 1991, and there is no evidence of any problems in that respect. We know that there will be problems following September 11th, hence the Bill.
On the narrow issue of which court should deal with these issues, we have no problems with the system we are using at the moment. It is a well tried and tested system and I ask the Committee to put its faith in the lay magistrates of this country.
Lord Thomas of Gresford: I thought I had brought evidence with me by quoting directly from the recommendations of the Runciman report. But now that we know where we are, I shall go back to the report and find out on what those recommendations were based. I am sure that the Runciman committee, which inquired into the working of the Act, went into the matter with a great deal of thoroughness. It came to the conclusion that the magistrates' court was not a satisfactory venue for drug confiscation orders.
As the noble Viscount said, the machinery and the issues involved in the first schedule to the Bill—the tracing and earmarking of property and so on—are complicated. Magistrates, particularly lay magistrates, are in no way suited to deciding legal issues of that kind. Presumably they would have to do it on the advice of the clerk to the magistrates' court, and that is not on. I hope that the Minister will look again at this particular problem.
Lord Elton: The Minister told the Committee that we have no examples of what has gone wrong under the Terrorism Act 2000. We should wait until the next stage to hear the evidence of what has gone right under that Act. It has not been running very long and it would not be fair to ask the Minister how many cases involving substantial amounts of money have been heard.
In his reply, the Minister said that there would be a need for expedition—I presume it was his reply to me—because of the need to confirm or otherwise the first detention order within 48 hours. I may have misheard or I may misunderstand the law, but I thought detention orders referred to people rather than to cash. Perhaps he can explain the context of his reply.
Lord Rooker: It is a question of what happens to the money after the civil proceedings. At the moment, there seems to be an obsession with the word "detention", but I am dealing with what happens to the money after it is forfeited. After 48 hours the money has to go into an interest-bearing account—procedures will be set in train after that period, after

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the money has been collected—which is obviously right and proper. The money may be collected wrongly and therefore there must be set procedures. That is why there is a need for speed.
There has been one case so far under the Terrorism Act. However, I do not rest my case on the Act. I rest my case on the fact that the procedure has been working for many years under the drug trafficking legislation.
3.30 p.m.
Lord Campbell-Savours: Perhaps I may ask my noble friend a question, without wishing to press him too hard. I understand that under subsection (7) the appeal procedure is to the Crown Court. I am not a lawyer. but is there any evidence to suggest that there would be a higher incidence of appeal to the Crown Court in the event that the first stage were to a magistrates' court—in so far as people might feel that the judgment made in the first instance was not correct?
Lord Rooker: I am dealing with an amendment to Clause 1. I cannot see a subsection (7) in Clause 1.
I shall have to take advice in order to respond to my noble friend at some other time.
Lord Swinfen: The noble Lord's reference is fine. It is to Paragraph 7 of Schedule 1, which is affected by this clause.
Lord Rooker: I accept that. But the reason the amendments are grouped is so that we can have an ordered debate. We shall have a fairly extensive debate on Schedule I when we come to the third group of amendments, which includes Amendments 5 to 15 and 17 to 22. I shall be happy to deal with my noble friend's point at that time.
Lord Kingsland: The Minister said that the burden of proof was on the non-government Benches in your Lordships' House to establish a better case for the High Court or the Crown Court than had been established by mere speeches in Committee. But the truth of the matter is that in many cases it is the Government, not the Opposition, the Liberal Democrat Party or the Cross-Benchers, who are in a better position to identify this evidence.
The key to our case is paragraph (c) of Clause 1(1):
"is, or represents, property obtained through terrorism".
The noble Viscount, Lord Bledisloe, has spent much of his life dealing with the law of financial services. He is in an extremely good position to explain to the Government just how complex legal concepts like "subrogation" and "tracing" are. With the greatest possible respect to the Minister, I simply do not think that the average magistrates' court is capable of dealing with such issues. They are uniquely, now, matters which fall to the expertise of the Chancery Division. With the greatest respect, I suggest that it is for the noble Lord to disprove that proposition.
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I should also like to say to the noble Lord that, frankly, I think it much more likely that he will find a High Court judge available within the 48 hours to deal with these complex matters than a magistrate. This matter can now stand over to the Report stage. Meanwhile, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 2 and 3 not moved.]
Lord Goodhart Lord Goodhart moved Amendment No. 4:
Page 2, line 2, at end insert—
"(6) An order under subsection (5)—

(a) must be laid before Parliament after being made, and

(b) ceases to have effect at the end of the period of 40 days from the day on which it was made unless before the end of that period the order is approved by a resolution of each House of Parliament (but without that affecting anything done under the order).

(7) In calculating the period of 40 days in subsection (6)(b) no account is to be taken of any time during which Parliament is dissolved or prorogued or during which both Houses are adjourned for more than four days."
The noble Lord said: I begin by repeating a declaration of interest that I made late last night at Second Reading. I am vice-chairman of the council of Justice, an organisation which has submitted a briefing paper to a number of Members of the House in relation to the Bill. Having made that declaration twice, I hope that I shall be excused if I do not repeat it during future proceedings on the Bill.
The Minister has dealt with Amendments 1 and 16, which deal with an entirely different subject matter from that in Amendment No. 4. He replied briefly to Amendment No. 3, which raises a similar matter, when it was mentioned by my noble friend Lord Mar and Kellie. But because that reply was not wholly satisfactory, and because the Committee should know what Amendment No. 4 is about, I shall deal with it briefly.
Schedule 14 to the Terrorism Act 2000 deals with the exercise of certain powers under that Act by officers of the police, the Customs and the Immigration Service. Those powers include in particular the seizure of cash. Under Schedule 14, the Home Secretary issues a code of practice about the exercise of functions by those officers. The Home Secretary has to lay a draft of the code or revised code before Parliament, and brings it into operation by order. Under Section 123(4) of the Terrorism Act, the order must be approved by affirmative procedure.
Under the Bill, the seizure of terrorist capital provisions in the Terrorist Act are replaced by the provisions in Schedule 1 to the Bill. Schedule 14 to the Terrorism Act is not replaced. It simply applies to the new provisions rather than to the repealed ones.
Clause 1(5) of the Bill provides that the commencement order bringing Schedule 1 into force may make modifications to any code of practice under Schedule 14 to the Terrorism Act that is then in force. These modifications need not just be consequential.
Commencement orders are not normally subject to any form of parliamentary procedure. So we have a curious situation. Amendments to the Schedule 14 code normally require affirmative resolution. When the commencement order is made, the Home Secretary can modify the code without any form of parliamentary control; thereafter, changes revert to the affirmative resolution procedure.
This seems completely illogical. I accept that there must not be a hiatus when there is no code in force. The Delegated Powers and Regulatory Reform Committee, of which I am a member, picked up this problem and recommended the negative procedure for the order made under Clause 1(5). This amendment goes somewhat beyond the committee's proposal. It proposes to use the delayed affirmative procedure—that is, the order comes into force immediately, but lapses unless it is approved by both Houses within 40 days. That would be as close as one could get to the affirmative resolution procedure under the order.
If the Government were to indicate their willingness to apply the negative resolution procedure, as recommended by the Delegated Powers and Regulatory Reform Committee, I should be happy. But if the code is thought important enough to require the affirmative procedure, it is wrong to allow an occasion when it can be modified with no parliamentary procedure at all.
I accept that, as the Minister has said, he has placed a copy of the draft code in the Library. But some explanation should be given as to why it was not thought appropriate even to go as far as the negative procedure, as was recommended by the Delegated Powers and Regulatory Reform Committee. I beg to move.
Lord Rooker: I take the noble Lord's point. In the absence of being able to see the code, there is weight to his remarks. But the code is purely a modified version of the existing code. It is a consequential change, simply because the cash that will be collected under this clause will be collected in-country, as opposed to being collected at ports. The consequences of that change require modification of the code. That is the substance of the change.
When Members of the Committee have had an opportunity to examine the draft code, if they believe that it goes beyond that, I shall be more than happy to consider using the negative procedure. I am not against the idea. The codes of practice are important. We want them to carry some force as codes of practice rather than legislation. Sometimes it is better if they carry the force of Parliament, although that is not always the case.
The modifications of the code are merely consequential amendments relating to that one change. There are a couple of drafting improvements, but they are minimal. If Members of the Committee believe that I have over-egged the pudding, I shall certainly be willing to consider the negative procedure when we debate this matter on Report. I believe,
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however, that when noble Lords see the changes in the draft, they will see that the changes are essential and that they are purely consequential on the expansion of the cash seizure scheme; namely, that cash is seized in-country, not merely at the ports.
Lord Campbell of Alloway: I have not seen the code. I should be conversant with the trigger clause but am not. Can the Minister say whether it is a code of practice or whether it has legal efficacy? If it has legal efficacy, surely it must have affirmative or negative resolution—from my point of view that is probably immaterial. But I should like to know the status of the code.
Lord Rooker: I shall cite the sentence that I have here because that will get it on the record. The code of practice in question is a code of practice for authorised officers who are officers empowered under the Terrorism Act 2000 to make cash seizures. It is simply as a consequence of the expansion that the code needs to be modified. It clearly has not received the negative procedure in the past. That is the implication of the note that I have.
Lord Campbell of Alloway: It has no legal efficacy. It is merely a code of practice.
Lord Rooker: But that is not unusual for government officers. On a variety of issues we discuss with industry a code of practice. The Government make inquiries of industry. We set down a voluntary arrangement. We do not want to be heavy handed. If we can operate non-legalistic codes of practice which are effective and do the job it is better than having to ram codes of practice through the legal system.
Lord Elton: I think that I am right in saying that the code of practice in question was printed as a draft called the Code of Practice for Authorised Officers under the Terrorism Act 2000. It was made statutory by the publication of a statutory instrument. The Minister is now saying that under the present legislation further amendments are needed and that they should be made under this legislation and not, for some reason, under the Terrorism Act 2000. I understand that such a code has force within a court of law and can be appealed to in a case. Therefore, in the sense to which my noble friend Lord Campbell of Alloway refers, it is a legal document with force.
Perhaps I may express a concern. The Minister said that this is needed only to make a couple of necessary and quite minor changes without which the provision will not work. We all accept that. But the power remains for ever. The power remains with the Secretary of State to make far more sweeping changes with no restraint from Parliament.
Lord Goodhart: Perhaps I may intervene. When making the commencement order, this is a once-and-for-all power to vary without parliamentary control. Thereafter subsequent changes go back to the procedure under the Terrorism Act which requires affirmative resolution.
Lord Elton: I stand corrected. Clearly the Minister's undertaking has more force than it would otherwise.
Lord Rooker: The noble Lord is right. It is a one-off. The code is introduced under the 2000 Act. If a revised code of practice were brought into force under that Act it would be by the affirmative procedure. I hope that I have not misled the noble Lord. The effect of the amendment would be to make a commencement order, in so far as it revised the code, subject to the emergency affirmative resolution procedure. It would cease to have effect unless it was debated and approved by both Houses within a period of 40 days. The modifications of the code are set out in the commencement order. This would have the effect of initiating debate on the code itself. That is why we do not think that the amendment is necessary. It is a small consequential adjustment.
Lord Goodhart: I am grateful to the Minister. I shall look at what the revised code states. Unless it appears to go beyond what is consequential, I would not wish to bring back the amendment. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 1 agreed to.
Lord Grocott: I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Benefits Uprating
3.45 p.m.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Hollis of Heigham): My Lords, with the permission of the House, I should like to repeat a Statement on the annual uprating of benefits and pensions, on the pension credit, and on new measures to help more people into work.
"As a result of the reforms we have made, we are able to do more once again to provide greater security for those who are unable to work, and who are retired. And this year, we will again increase some benefits by more than the usual uprating.
"We are also making fundamental reforms to reward savings. I will set out how the pension credit provides a radical departure from the social security system we inherited, and I will announce further measures to provide greater employment opportunity for those who can work.
"First, on uprating, most national insurance benefits will rise in the normal way by the retail prices index, which is 1.7 per cent, and most income-related benefits will rise by the Rossi index, which is also 1.7 per cent. Details will be placed in the Vote Office and will be published in the Official Report.
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"We are already doing more to help parents, so that families can balance their work and home lives. That is why, in this uprating, the standard rate of maternity allowance and statutory maternity pay will rise from £62.20 up to £75 next April—the largest increase in maternity benefit since 1958, helping around 340,000 families a year—and in 2003 it will go up again to £100 a week.
"In addition, the Sure Start maternity grant will rise from £300 to £500 next year. In 1997, a new mother on income support would have received just £100 to pay for essential items; from next year, she will get £500—a substantial increase for mothers on low incomes.
"This year, we want to do more to help families who are bringing up children with disabilities. When we came into office, the extra money paid to low income families with a disabled child was just £21 a week. Last year, we increased it by more than £7 a week.
"This year, I can go further. I propose to increase the disabled child premium by another £5 a week, on top of the normal uprating, to a new rate of £35.50. In 2003, it will rise again by £5 over and above inflation—to more than £40 a week on top of basic income support or tax credits. That will benefit around 80,000 children. That is extra help where it is most needed, for families on low incomes—both in and out of work—with disabled children.
"There is one further change I want to announce today. In the past, people with the most severe disabilities found that if they or their partners were in work, often against all the odds, they lost entitlement to the independent living fund, which pays for their essential care.
"So I can tell the House today that from April next year the earnings of disabled people and their partners will no longer be taken into account in the independent living fund—worth an average of £130 a week to those families. At the same time, we will increase the capital limits, in relation to the fund, to extend help to people with savings of up to £18,500.
"We are also determined to boost pensioner incomes. In 1997, the poorest pensioners were expected to live on just £68.80 a week. Last year, we increased the minimum income guarantee to £92 a week. From April next year, the minimum income guarantee for a single pensioner will rise by £6 to £98.15 a week. That is an increase of £23 a week for the poorest pensioners, over and above inflation, since we came to office. For couples, the new rate will be £149.80.
"To ensure that all pensioners share in the rising prosperity, I confirm that the basic state pension will rise by £3 in April, and by £4.80 for married couples. The widow's and bereavement benefits, which, because of the changes that we made in 1998, are now paid equally to men and women, will also rise by £3. As we promised in our manifesto, the basic state pension will remain the foundation of retirement income, which is why we have announced

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guaranteed rises for the future of at least £100 a year on the basic state pension for single pensioners, and at least £160 a year for couples.
"We also promised to do more to reward pensioners who have saved for their retirement. A year ago, I published a consultation document, which set out our proposals to reward thrift. Today, I am publishing our response, setting out how the pension credit will work. Copies are available in the Vote Office. Tomorrow, I shall also publish the pension credit Bill.
"All of us have met pensioners who struggled during their working lives to put something by for their retirement and who then found that they were little or no better off than people who had saved nothing. The pension credit will make sure that, in future, it pays to save.
"The pension credit works in two ways. First, it will bring pensioners' entitlement up to a guaranteed minimum level of at least £100 a week in 2003, or £154 for couples, and rising in line with earnings for the rest of the Parliament.
"Secondly, it will provide an additional top-up to reward pensioners aged 65 or over who have saved for their retirement. Pensioners with modest second pensions and savings will get more as a result of their thrift.
"There is a further change that is essential to reward savings. We will abolish the rule that excludes pensioners with £12,000 or more in savings from any help. There will be no upper savings or capital limit. Instead, we will introduce a fairer system for taking into account income from savings.
"Around half of all pensioners will stand to gain from the pension credit: more than 1 million pensioners from raising their guaranteed income; and more than 4 million pensioners from the savings reward, and the improvements to the rules on the treatment of savings. Two-thirds of those who stand to gain from the pension credit are women, and half of those are over the age of 75. On average, pensioners will gain £400 a year, with some getting up to £1,000 a year. That is the difference that the pension credit will make.
"Any pensioner with income below around £135, or couples with an income below £200, will see their hard-earned savings rewarded with extra money, not penalised as in the past. We are also making it easier for pensioners to get all their entitlements. Last year, I said that we would end the weekly means test and the endless form-filling—and we will. The pension credit will be calculated at the same time as the basic state pension when people retire. In most cases we will reassess the income of those over 65 only every five years—not every week, every month or every year. Each year, they will see an automatic rise in their pension credit, after the uprating, and taking account of any changes in their second pensions.
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"The pension credit will increase the guaranteed income, it will end the weekly means test and it will reward thrift. It will remove an injustice in the system. For the first time, it will pay to have saved, even modestly. More than 5 million pensioners stand to gain.
"I now turn to employment. Over the past four years, we have introduced more help than ever before to make work pay and to make work possible. Today, I am also publishing a paper with my right honourable friend the Chancellor, which demonstrates the need to provide more employment opportunities to those who have missed out in the past.
"The analysis shows clearly what happened when we did not have a system that actively helped people into work and when the Government took a hands-off approach to unemployment, leaving it to chance. Between the 1970s and the mid-1990s, the number of lone parents and sick and disabled people on benefits trebled. A whole generation was written off.
"Three immediate conclusions follow from that paper. First, we need to do more to help everyone of working age to get into work wherever possible. That is why we are extending the single gateway to the benefits system—Jobcentre Plus—across the whole country starting next year. Everyone of working age will have work-focused interviews to help them into jobs wherever possible.
"Secondly, when people lose their jobs, the evidence shows that the quicker we intervene, the quicker people will get back into work. As the Chancellor set out yesterday, our economy is well placed to deal with global uncertainty and the labour market is in a stronger position than for a generation. However, when people lose their jobs and when there are redundancies, we need to take action quickly. There are jobs available. Every month, half a million people enter work or change jobs.
"We need to do more to match people with the vacancies that employers are trying to fill—the 10,000 vacancies notified to the Employment Service every working day. Today, I can announce that I am allocating an additional £6 million over the next 2 years to the rapid response service, which offers prompt help to people who have been made redundant. The money will be used by each region to put together the right response for people in their communities, making sure that people affected by redundancy have the information and help they need to find new jobs. They will work to match people's existing skills to those needed by new employers and they will make sure that retraining is available to help people move into new industries.
"Thirdly, we now have the lowest unemployment level for 25 years, but there are still people who need extra help to take up available jobs in their areas. Over the past four years, the New Deal has established a new welfare contract, with more help and support than ever before, in return for greater responsibility on the part of individuals to help themselves.

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"Today, I can announce a further measure, building on the New Deal, for long-term unemployed people who need more intensive help to get into work. Such people may have gone through the New Deal and still have not been able to find a job. We will guarantee those who qualify a full-time job, lasting up to a year and paid at the national minimum wage. They will have the same employment rights and they will be entitled to the same in-work benefits as anyone else. In return, it is not unreasonable to require people to take up that opportunity. We aim to give people a choice of job, but they will not be able to turn down all offers arid remain on benefit.
"We will start this approach in six places from April next year, in areas within Sheffield, Cardiff, Oldham, Sunderland, Lambeth and East Ayrshire. We will follow those with a second group over the summer, covering areas within Leeds, South Manchester, Sandwell, Bristol and Greenwich. In the autumn, there will be further pilots within Hackney, Great Yarmouth, Knowsley, Rotherham and Coventry, with provision starting by the end of the year in Burnley, Wrexham, Dundee and Bradford. I will be writing to honourable Members in all 20 areas, asking them to become involved.
"These are jobs that we will pay for, working in partnership with employers, local authorities and organisations with experience in offering intermediate labour market opportunities. It is an investment of £40 million to equip 5,000 people who are currently long-term unemployed with the skills, the support and the experience of work that they need, as a stepping stone to jobs in the local labour market.
"Britain's unemployment level is the lowest since the 1970s. The New Deals have helped hundreds of thousands of people into work. We are determined to ensure employment opportunity for all, including those who have missed out in the past. These measures will help us to do that.
"We are doing more to help people into work and to help those who cannot work and we are making sure that, for the first time, pensioners are rewarded for their savings. I commend this Statement to the House".
My Lords, that concludes the Statement.
4 p.m.
Lord Higgins: My Lords, I am sure that the House will be grateful to the noble Baroness for repeating the Statement. As it concerns pensions, I should declare an interest as chairman and trustee of an occupational pension scheme.
There are certainly a number of aspects of the Statement that should be welcomed, particularly the proposals on disabled children's benefit, the changes in the independent living fund and the change with regard to capital limits. All of those are welcome.
I had intended to begin with what is almost a traditional remark by saying that the good news was announced by the Chancellor yesterday and that the bad news was announced by the Secretary of State
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today, in the sense that the Chancellor normally announces the benefits and the Secretary of State announces the increases in national insurance contributions that are used to finance those benefits. Clearly, my previous remarks have been taken into account by the Secretary of State because there is no mention of the cost of the increases that the noble Baroness has announced. Are we to understand that there will be no increase in national insurance contributions? If some are to be made, no doubt the House would wish to know.
The policy has changed on the basic pensions uprating. Two years ago there was an increase of only 75p—a matter that caused enormous agitation. Immediately ahead of the general election, that was suddenly increased to £5. As the next general election is not immediately pending, this year's increase is only £3. However, an overall guarantee has been announced that the annual basic state pension will rise by £100 for a single pensioner and £160 for married couples in 2003. Subsequently, the basic pension will rise each year by 2.5 per cent or by the increase in the retail prices index, whichever is the greater. That provided the Chancellor with a very good sound-bite yesterday.
We have just been told that the basic state pension will form the foundation of retirement income, as stated in the manifesto. Will the Minister confirm that that increase is irrelevant to the large number of people on minimum income guarantee? They will have a separate arrangement.
In that respect, is it not the case that the proposals announced by the Minister will result in more and more erosion of the importance of the basic state pension because the basic state pension is not rising as fast as the minimum income guarantee? The effect will be more and more means-tested benefits. In the light of those proposed changes, will the noble Baroness say what percentage of pensioners she expects to be on means-tested benefits in the period she has described, compared with the figure in 1997? There has clearly been a substantial increase in means testing, with the corresponding effect on the incentive to save and so on, although that will be ameliorated to some extent by the pension credit, to which I shall come in a moment.
Is it not also the case that although the Chancellor keeps increasing benefits, many people do not claim them because they do not understand the benefits to which they are entitled? Two years ago, Age Concern suggested that about 750,000 people were not taking up the income support to which they were entitled. Can the noble Baroness say what percentage will not take up the improved benefits that the Chancellor has announced?
I fully accept that the noble Baroness has been seeking to deal with the take-up problem. We are now told that there is a new form for applying for minimum income guarantee, which instead of being 40 pages in length is 10 pages. Some aspects of it are rather curious. A question in Part 2 asks:
"Does your partner agree to you making this claim?".

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If the answer is "No", the form states:
"Please still tell us as much as you can about your partner".
It does not add the usual caveat to use an extra sheet of paper if necessary.
While it is true that the document has been chopped from 40 to 10 pages, a helpful leaflet has been attached to it—amounting strangely enough to 30 pages—saying what the document is all about. It is all very confusing, so there may still be problems of complexity, which bedevil the whole system.
The Chancellor of the Exchequer and the Secretary of State have become obsessed with a multiple system of tax credits. One must wonder how many people actually understand the system. I have always taken the view that both the Chancellor and the noble Baroness do, although I am beginning to wonder even about that. We should consider what has happened since 1999 when five new tax credits for families were proposed. The Chancellor decided to scrap three of them and he then added another two. I rather doubt whether even the noble Baroness could say exactly straight off the top of her head what those five were, which three were scrapped and which two were added. She is looking a little puzzled, but if the noble Baroness does not understand these matters, it seems highly likely that no one in the country does so.
The serious point to be made is that the system has become more and more complicated. It will be further complicated by the pension credit. While one welcomes the fact that those with savings, within a very narrow band of incomes, will get some benefit, as against having it taken away totally because they are on means-tested benefits, none the less the pension credit system will extend means testing still further.
It was pointed out in one of the weekend papers that, under the pension credit, for every pound of income above the basic state pension, which is £77 up to the level of the minimum income guarantee of £100, an elderly person would receive an extra 60p. Once that total income, including the pension had reached £100, the top-up would immediately be reduced by 40p for every extra pound of income. The marginal rate of tax will therefore be 40 per cent.
Will the noble Baroness explain the position of a pension credit recipient who has income above the full basic state pension and other benefits? I understand that the marginal rate—or tax rate—of withdrawal of benefit will be an effective rate of 52 per cent when the recipient receives council tax benefit, 79 per cent if he receives housing benefit and 91 per cent if the recipient receives both of those benefits. No doubt we can consider those matters at Second Reading and beyond after the Bill is published. It is worrying that this kind of structure is being constructed. We shall examine it in great detail.
While there are welcome aspects of the Statement, the Government's pension policy is in disarray. The basic state pension has been eroded and there has been a massive extension in means testing, to which I referred. The stakeholder pension, which was the flagship of the Government's proposals, appears to be
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missing its target. I understand that of the 416,000 that have been sold, only about 34,000 went to people in the £10,000 to £20,000 income group, at whom the proposal was aimed. We spent many hours in this House debating the state second pension, but Mr Timmins, a well-known authority on these matters, said in the Financial Times that he believed that it had been overcome by events.
On top of that, the occupational pensions scheme, which is so important, is under threat not only by the Chancellor's change to ACT, which is finally beginning to bite because of the rundown in pension fund surpluses, but by other changes on actuarial valuation, the accountancy system, FRS 17, and so on. There remains great concern about the proposal that people must draw their annuity at age 75. We had hoped that the Chancellor would finally have faced up to the problem and removed that limit. It is particularly important because of the low level of annuity rates which are a consequence of the Government's policy with regard to borrowing.
The Chancellor announced yesterday a massive increase in borrowing in the years to come. That is likely to raise annuity rates. But people are still being forced to take their annuities when they reach 75 when they may be able to find a better deal later. This is a matter on which your Lordships voted in favour, only to have it overturned in the Commons on at least two occasions. I hope the Chancellor, having missed this opportunity, will none the less do something about it in the near future.
4.10 p.m.
Earl Russell: My Lords, the Minister shot my fox. For as long as I can remember debating these Statements—since 1989—I have been calling for capital limits to be uprated in line with inflation. The Minister has now not merely done it; she has abolished the limit and is bringing in new methods of calculating the treatment of savings. I look forward with a great deal of interest, first, to looking at those methods; and, secondly, to preparing a new message on tape ready for delivery next year. This one is finished. I should like to say thank you. That is a well-earned piece of thanks because the Minister has put a great deal of work into this.
I should like to welcome a number of other points in the Statement. The increase in maternity grants is particularly to be welcomed. It is an expensive time in anyone's life and it does not get any cheaper.
I welcome the increase in the Sure Start grant, but with one qualification which the Minister can probably script for me. Under the Sure Start system one risks disentitlement if one does not accept the help on offer. How many people has that happened to? The Minister may not have that figure instantly to hand. Also, does it have a discriminatory impact on Christian Scientists who do not believe in calling in medical help? We spent a lot of yesterday listening to discussion on incitement to religious hatred and the evils of religious discrimination. We must remember that some people actually believe that it is wrong to call

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in professional medical help. For the benefit system to discriminate systematically against them raises questions which call for a certain amount of thought. I should like to hear that that thought has been given and what the answer is.
I welcome the disregard for the independent living fund. I welcome also the uprating for the capital limit of the independent living fund.
I am glad that there is a rise in the basic pension; I am sorry that the Government could not manage any more. But can the Minister tell us what the take-up figure of the MIG is? We have had a great deal of discussion about the MIG and I will not go through it again. The take-up figure is where it matters most.
The pension credit is, in a sense, undoing the effect on savings which is created by MIG; so we have a sort of "two-step". I hesitate in the Minister's presence to describe it as a "military two-step"; but it is becoming something almost as much interlocked. In fact, the Government's pension policy is beginning to resemble Penelope's Shroud—there is an endless series of re-stitching going on.
That raises one of the big questions on pension credits. In its present form that scheme does not bear the mark of finality; it is something with which a future government may want to tinker. So the two-step will turn into a three-step; then it will turn into an eightsome reel and after that I do not know. So it is a rather uncertain foundation on which to plan for retirement. As one whose retirement is within the next 12 months I must declare an interest in saying that.
It is an extremely complicated system. I know the Minister is making a big point of the forms being filled in at the same time; but I doubt whether many people will understand the interaction between the three elements of MIG, the basic pension and the pension tax credit. Where we have a complicated system and an insecure means of planning, we usually also have a low take-up. The Minister will remember the debates on child benefit in the 1980s, though I regret she did not have the privilege of taking part in them here; I wish she had. The key point was always that, because child benefit was simple, the take-up was remarkably high. Here we have the exact reverse. So we may be producing a system where there is not a great take-up, where an immense amount of thought has gone into it but with a great deal of effort—like racing a car engine out of gear. I await with some anxiety to see what the effect will be.
I must also confess that I was surprised—though this will not surprise the Minister—that the Government have not paid attention to the adequacy of basic benefit levels. I have with me a further briefing from the Zacchaeus 2000 Trust, with which I know the Minister is familiar because a copy was sent to her. It draws attention to a number of further studies in progress. They show serious levels of poverty among those on benefit, especially those who have got into debt. That makes it more serious that, first, there is no systematic study of those who are on lower figures than 40 per cent of average income. We do not know
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anything about those who are on 20 per cent or 10 per cent of average income, or in some cases even less. That is a real gap in the department's research.
Secondly—this has been part of my tape since 1989 and I regret that I see no reason to take it off—there is no study whatever of the levels of debt among people on social security benefit. Those two things are badly needed. Until the Government have them, they cannot judge the force of the arguments that the Zacchaeus 2000 Trust is putting forward. That is why those arguments concentrate on the need for a study to determine a minimum level of income necessary to determine good health, which is the policy of these Benches as well as the policy of the trust. But I can see no sign of any government even so much as engaging in the argument. This is another missed opportunity and I regret it.
I am also a little surprised by one or two things in the employment section of the Statement, really as an example of academic method. Paragraphs 31 and 32 draw attention to the much lower number of people who are unemployed. We all welcome that. They appear—I put it no stronger because I am not sure they are saying it—to be claiming all the credit for the active labour market policy. The chronology is wrong for that. The fall in unemployment began before the 1997 general election. Therefore it must have been started by policies for which the present Government cannot claim responsibility. If indeed any large part of it is achieved by the policies of the present Government, we are not given a clear answer as to how.
Paragraph 45—the Minister's new initiative of the offer of a job—sounds awfully good. But I am not sure that when this gift horse is looked in the mouth it will be quite as good as it appears to be. First, I hear a distinct whiff of Louis Blanc behind me. Secondly, I hear the problem about the whereabouts of the jobs and the people. I do not know whether the Minister was in the House recently when my noble friend Lord Greaves asked a question about the price of housing in Burnley and Oldham, where the market has effectively collapsed. We can compare that with the sort of things said about housing by my honourable friend David Rendel, MP for Newbury. Newbury have the jobs and Burnley and Oldham have the housing. And it is not very easy to uproot somebody from Burnley and Oldham and put them in a job in Newbury. I do not know whether the Government have thought that through.
The second, and more serious, is the element of conscription behind this plan. The Minister said that it is reasonable to require applicants to take a job. In certain circumstances that may be so. I would not want to trust the machinery of the state in any form under any party, not even my own party, to make that decision for me. Some very curious decisions have been made. I can recall some made under the youth training scheme in the past. For example, there was an asthmatic who was required to work regularly as a painter. He attempted to do so and was not fit to work for another six months. There was also an electrician

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who was colour blind. He was required to take a job as an electrician. I am rather glad that he did not do my wiring.
I believe that before introducing compulsion the Minister should remember not only that the gentleman in Whitehall does not always know best; the lady does not, either.
4.21 p.m.
Baroness Hollis of Heigham: My Lords, I thank the noble Lord, Lord Higgins, and the noble Earl, Lord Russell, for their response; and if not the noble Lord, Lord Higgins, then at least the noble Earl, Lord Russell, for the generosity of his response on so many fronts. That was a very pleasant change. But I am sure that the noble Lord, Lord Higgins, meant to, but forgot.
I turn first to the points made by the noble Lord, Lord Higgins. He opened with a kind of rallying cry about the erosion of the basic state pension. That is a bit rich, given that last year we increased the basic state pension for single pensioners by £5; this year by £3; and have made a commitment to at least an additional £2 per week in future. If that sort of increase represents the erosion of the basic state pension, then I suggest to the noble Lord that in the use of the word "erosion" he and I do not mean the same thing.
The noble Lord went on to a more substantive question; namely, whether the way in which and the extent to which we are seeking to target help to the poorest pensioners represents means testing. I accept that we can bandy labels between us. There is a real issue here because the noble Lord knows as well as I that if one opts for universal benefits everyone gets the same and one preserves existing inequalities in incomes. We know that in the past decade or so the top 20 per cent of pensioners saw their incomes grow by 85 per cent and the bottom 20 per cent by about 28 per cent. Universal benefits simply preserve that inequality. As a result, everyone gets the same: the poorest one-fifth get the same as the richest one-fifth. The alternative is to try to ensure that five times as much goes to the poorest one-fifth.
That is my view. If one accepts that, the question then is how one can make that targeting effective so that those entitled are able to claim and do so and that they are confident about their claim. What matters is that the money goes to those who need it. Most of your Lordships would be on the receiving end of the generosity of the noble Lord, Lord Higgins, but at the expense of some of the poorest in Burnley and Oldham, as the noble Earl, Lord Russell, pointed out.
The question is whether what we are proposing, both the pension credit element of guarantee and the pension credit element of reward, represents proper targeting of benefit. I believe that it does, just as taxation targets those who are better off who pay more. As the noble Lord admitted, we are going from complicated forms of 40 pages down to 10 pages. Above all, we are having only five-year checks. Basically, we accept the fact that when a person retires
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and receives a pension, the income is likely to be stable. Pensioners may be affected by the loss of a spouse and may go into hospital for long-term care. They may also have a big inheritance. Apart from that, they are likely to have a stable income.
We look at their income at the time of retirement, check with them what the figures are, and then, all being well, the retired person will continue to receive that money for at least the next five years and probably thereafter. Therefore, we reduce our intervention in their lives to a possible minimum and give them security of income free of bureaucracy which will enable them to enjoy a much more generous lifestyle than in the past.
As a result of what we doing under the pension credit, half the number of pensioners in this country will gain. For example, at the moment a pensioner who is the widow of a local authority manual worker receives only one-half of her former husband's pension, about £100 per month. At the moment she does not gain one penny from that because it is offset against the minimum income guarantee. But in future she will not lose every penny. She will keep £60 of that £100 and she will be better off by £60 per month.
These proposals should not be criticised as being miserly means testing when we are ensuring that targeted money goes to people such as the widow to enjoy the kinds of things that so far she has been unable to do. I hope that the whole House will welcome that as decent, proper and targeted.
The noble Lord asked about housing benefit and council tax benefit. That is a perfectly fair point. At a cost of half a billion pounds we shall be raising the applicable amounts accordingly so that poorer pensioners on pension credits see the full gain. It is a proper question to ask. We are doing it and it is costing half a billion pounds. As a result there will not be the deduction rates which the noble Lord first feared.
The noble Lord asked about the state second pension. I could go into a general defence of our pension policy, but I do not believe that that is appropriate given the time. But no doubt we shall return to the broader issues. The stakeholder scheme is in its early days. It is going well, but there is a long way to go and there are many questions still to be answered about how we reach the self-employed. It is important that we devise all possible means for ensuring that people retire with a pension. A pension credit now means that those even with modest pensions such as £20, £25 or £30 per week will be able to achieve real gains having made those savings.
Lord Higgins: My Lords, what is the level of increase in contributions this year or is there none?
Baroness Hollis of Heigham: My Lords, we are not having a general debate on the Pre-Budget Statement. We are talking about the Statement issued today. We have not made an announcement on national insurance as the noble Lord is aware.
The noble Earl, Lord Russell, gave a welcome to the end of capital limits. I am glad he is pleased. It means in practice that if a single pensioner receives the full

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state pension he can have savings of up to £35,000 before running out of entitlement to pension credit. We can discuss the technicalities of how one reaches that figure, but it is a really generous response.
The noble Earl asked about disentitlement to Sure Start. He referred in particular to the Sure Start maternity grant of £500. I have the same concerns. We carried out what I call a quick and dirty piece of research. In about half-a-dozen benefit offices we checked the last 20 or so people who had been disentitled from the Sure Start maternity grant, which is currently £300, in order to find out what had happened to them. We tracked them. We found that almost all of them—about 95 per cent—returned to the system. The reason why they had become disentitled was because they had not filled in the forms correctly, they had applied too early, and so forth. We still need to follow through a couple of cases, but we are fairly confident about the outcome. I take seriously the point about religious preferences. We are pretty confident.
At the end of the day it is reasonable to attach this provision to ante-natal care for one very basic reason. We know that the best hope for children to thrive is that they are born at full weight and in decent health. They are likely to do so if the babies have been exposed in the womb to ante-natal care. It is particularly important for the children of the poorest families and some children in the poorest ethnic minorities that they have access to such care. Yes, we are bribing them with £500 to receive that care, but if it ensures that the child has the best possible Sure Start then I hope the noble Earl will agree that it is the decent thing to do.
The noble Lord, Lord Higgins, asked for the take-up figures on MIG. We have a total caseload on MIG of 1.7 million people. The campaign was launched in May 2000. We estimated that between 600,000 and 900,000 pensioners might have been entitled to the minimum income guarantee at that time but were not claiming, but we could not be sure. In fact, we had more than 985,000 inquiries. Therefore, we are reasonably confident that we reached those we needed to reach. Following that, we have processed 243,000 additional claims, of which half have been successful. Of those that were not successful, half were over the capital limits and half were over the income limits. That situation may now he revised as a result of the announcement we made today.
The noble Earl, Lord Russell, also referred to two further points. He questioned the adequacy of benefit levels and asked whether—this has been a longstanding argument between him and myself—we relate benefit levels to standards of budget assessment, particularly as regards the Family Budget Unit. There is much debate about what constitutes an adequate budget, what goes into it and the methodologies used. I throw two pieces of information at the noble Earl. In 1997, a child under 11 on income support rates—typically the child of a lone parent—would have received from income support £16.95. As of this October, a child under 11 on income support will receive benefit of £34. That benefit has more than doubled in cash terms and constitutes a 90 per cent
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increase in real terms. It is no mean accomplishment to achieve an increase from £16.95 to £34 for children under 11 on income support—the poorest in the country—and it should be acknowledged.
I follow that with a second offering to the noble Earl. In 1998, Jonathan Bradshaw estimated that for a lone parent with two children the gap between benefits and an FBU assessment was about £25. He says that as of last year that same gap fell to something between £5 and £6. That was before the increases of this April, before the increases in income support and child benefit and before the increases next April in the child maintenance premium. I am confident that together those increases will close the gap entirely even before we get to the changes that will be introduced by the integrated child credit. While I dispute much of the methodology of the FBU, I hope that no one in your Lordships' House will believe that we are not committed to, and do not care deeply and passionately about, the welfare of poor children because we do.
Finally, the noble Earl referred to an element of conscription. It is reasonable to expect people to take a job in return for benefit. We are offering measures such as intermediate labour markets which recognise that some people need more help than others. I believe that the introduction of the personal adviser threshold with the support that that provides will enable people to get back to work. I say bluntly that it is no kindness to let someone who is 24, 25 or 27 remain on benefit for half a century. They are entitled to come into the mainstream of life which they will achieve as adults only if they are in work. Of course, they must be available for work; they do not have small dependent children, for example. We have to ensure that we help them. That is what personal advisers do. That is why we are starting these schemes and will extend them if appropriate. It is not right and decent to allow people to languish in unemployment outside the mainstream if we can help them to a better life. I hope that the Statement contributes to doing exactly that.
4.33 p.m.
Baroness Wilkins: My Lords, the announcement of my noble friend the Minister that the earnings of severely disabled people and their partners will no longer be taken into account as regards the Independent Living Fund could not be more welcome. I am extremely grateful to her for the work she has put into that matter to ensure success. I assure her that many hundreds of severely disabled people will be delighted, especially those involved in the Let Us Work campaign and the National Centre for Independent Living. That, together with last week's guidance on local authority charging, which also means that earnings are disregarded in the assessment of income in relation to charges for local authority services, will ensure that work pays for severely disabled people. That is extremely welcome.
I am aware that the change to the ILF owes a great deal to the personal efforts of my noble friend the Minister. It gives me the confidence to ask her to ensure that the Government also heed the justice of the argument that winter fuel payments should be

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extended to disabled people. They are desperately in need of that help. Disabled people who are immobile feel the cold far more keenly than able-bodied people, as noble Lords who see me swathed in clothing will appreciate. The cold gets deep into one's bones and it is hard to get warm through one's own efforts. Disabled people are far more likely than able-bodied people to be at home using up their heating allowances and are far more likely to become ill due to cold. They are far more likely to be on restricted incomes. I hope that the Government will heed the justice of the argument that the heating allowance should be extended to disabled people. Once again I am most grateful to the Minister for her work on the ILF.
Baroness Hollis of Heigham: My Lords, I am delighted that my noble friend's persuasion and pressure have been rewarded. She has been a doughty campaigner for reform of the Independent Living Fund. She has rightly given us no peace on the issue. I am absolutely delighted that today her efforts are rewarded. Given that she suffered from a virus last week, I am delighted that she is able to be present for the Statement today. As regards winter fuel payments, I am afraid that I have to disappoint my noble friend. The matter was raised earlier in the House. I made the point then that one difference between pensioners and disabled people is that disabled people have access to the disability living allowance. DLA was designed to cover the extra costs associated with disability, including diet, laundry, care and heating. That is why we confine winter fuel payments to the elderly.
Lord Hodgson of Astley Abbotts: My Lords, I declare an interest as a chairman of an occupational pension scheme. In the light of the flurry of initiatives on pensions the Minister has now announced, does she believe that the Government made a mistake by removing the tax credit for pension funds in the early years of their regime which removed £3 or £4 billion worth of benefits from pensioners? The fund of which I am chairman lost some £250,000 which could otherwise have been paid out in increased benefits. It seems to me that we are recycling money which could have been made available in the first place.
Further, I have not had the benefit of reading the Statement but I believe that the Minister referred to an increase or to a sum of £6 million to be made available over two years to the rapid response unit. That is perfectly welcome in itself but we need to bear in mind, in the light of the huge loss of manufacturing jobs in this country and the two-speed economy as a result of the Government's valuation of the pound, that that is £60,000 per week across the entire country. While the Government may trumpet it as a huge initiative, it is in fact a trivial sum of money in terms of solving a severe problem in manufacturing industry.
Baroness Hollis of Heigham: My Lords, as regards the noble Lord's first point, in our view ACT rewarded dividends and diverted money from proper investment. I compare the position in the United
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States with the position in this country as regards the percentage of GDP going to dividends and investment. While ACT existed, the UK figure went up from 3 to 6 per cent. However, the United States figure went up from about 3 to 4 per cent. That process occurred at the price of investment in our economy. We believed that ACT deformed the tax system. What matters is the health of the economy and that, in turn, depends on proper investment in the economy on which, in the long term, pension robustness relies.
As to the noble Lord's second comment about the £6 million for the rapid response unit, I take the point about a limited sum of money. However, that is only one part of a wide range of strategies. We seek to respond to the situation of sudden redundancies, major redundancies and so on. The initiative is additional to the employment opportunities resource, the New Deal and the work we are doing on Jobcentre Plus and the like. If the noble Lord has concerns about any particular area he thinks is underfunded, I shall be happy to consider them.
Baroness Greengross: My Lords, I too congratulate the Minister and the Government on having addressed some long-lasting concerns that many of us have had about vulnerable groups in our society such as parents of disabled children and ante and post-natal care for the poorest families through Sure Start. I refer to a group of people who have always been marginalised; namely, those who have saved. It is very much in the culture of our older generation to be thrifty and to save even when that is difficult. For years they have been penalised for doing so. I am delighted that that situation will not continue. I have not had time to study the measures in detail, but the five-year assessment may do much to remedy that situation. However, the means of obtaining such payments is still very complicated and needs to be simplified.
For many years—in particular, when I was with Age Concern—I worried about the low take-up of means-tested benefits. But I agree with the Government's view that the differences in pensioner incomes are now so great that it is better to target those. In my view, it is most important to get rid of the stigma associated with take-up. I believe that the announcement about the pension credit, which I have been awaiting with enormous interest, may deal with that. I hope very much that it will.
My final point concerns the help that the Minister has announced for unemployed people. I hope that, from now on, we can assume that the care, advice and support that will go to unemployed people who have the greatest difficulty in obtaining jobs will be extended to measures for those over the age of 50. Such people represent a very vulnerable group of unemployed people.
Baroness Hollis of Heigham: My Lords, I am delighted that the noble Baroness, Lady Greengross, welcomes what we are doing. She and, behind her, Age Concern have obviously been very active in trying to ensure that we develop pension policies that focus on those most in need.

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The noble Baroness talked about how people might obtain the benefit. She is right. At present, approximately three-quarters of pensioners deal with what we used to call "benefit offices" by telephone, which is a more acceptable method. There is also "tele-claiming". All the systems which Age Concern is helping us to pilot are showing a very successful take-up. The noble Baroness is absolutely right that the key to effective targeting is to remove stigma. Once we have done so, I believe that we can be confident that the resources will reach those who most need them.
The second point raised by the noble Baroness related to our help to people over the age of 50. She is absolutely right. That is why we have developed the New Deal for the over-50s. One interesting figure came up when we were dealing with a previous Bill. I was much struck by the situation relating to widows and widowers. Of those over the age of 55, fractionally more widows than widowers are in work. Behind that lies the fact that middle-aged women find it easier to remain in or return to the labour market than do middle-aged men, in particular if they are manual workers. That is why we have been developing new deals and pilot schemes. We want to ensure that the talents and richness that such people have to offer is honed to fit today's economic climate.
Baroness Howells of St Davids: My Lords, we have listened to a very buoyant and uplifting discourse on pensions. However, I want to raise one point which is seen as a matter of injustice by the Caribbean people who came to work in this country, giving more than 30 or 40 years of service. Discrimination still exists against those who have managed to return to live in their home country. Whatever pension they have when they leave this country, they must live on it for the rest of their lives. Over the years, no adjustment has been made to the level of such pensions.
This country is disadvantaged by not adjusting those pensions because the people who receive them have to return to this country for any medical treatment that they need. Their counterparts who remain in this country receive increases in their pension each year. But for those who return home, the level of the pension stays the same. I know that this is a subject which creates a very deep hole for the Government because people from other countries who have never worked here go away and, at the age of 60, claim pensions as citizens.
The pensioners who have given years of service feel that they are badly discriminated against by a state which does not allow an increase in their pensions. In addition, the countries in which they live have a basic standard of living. If we are talking about global poverty, then this is a group which is being penalised in a way that they feel is unjust. I am sorry to raise the matter at this stage, but I believe that it is the only time that I can usefully do so in the House. I repeat that the people to whom I refer are suffering greatly from such a loss.
Baroness Hollis of Heigham: My Lords, I sympathise with many of the points that my noble
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friend Lady Howells makes. However, various basic sets of arrangements are in place. One set is with the EU in which mutuality of pensions follows from the arrangements for the mobility of labour. Those pensions are automatically adjusted.
Secondly, we have bilateral arrangements with certain Commonwealth countries and other countries. They are usually of long-standing, most having been made in the 1950s and 1960s. Incidentally, that includes some Caribbean countries. I believe that I am right in saying that there has been no further development of bilateral arrangements, either under the previous administration or ours, since the ear]y 1980s. However, that bilateral relationship does not apply to other countries, some of which were mentioned by my noble friend.
At the end of the day, a judgment must be made about priorities and cost. The unfreezing of overseas pensions would have to apply not only to Caribbean countries; it would have to include South Africa, Australia, New Zealand, Canada, and so on, where far more ex-British residents live. That would cost £300 million or more. It is the Government's judgment that that does not constitute a high claim on our existing priorities, which are to help the pensioners in greatest need.
Lord Brooke of Sutton Mandeville: My Lords, pursuant to the first question asked by my noble friend Lord Hodgson, the Prime Minister at least twice in another place defended the removal of ACT tax credits in the summer of 1997 by saying that the subsequent behaviour of the stock market justified the move. Since, in the past two years, the stock market has fallen by almost one-quarter and, on the basis of the Prime Minister's logic, if the stock market continues to fall towards its 1997 level, can we anticipate the restoration of tax credits? That would be a profound relief to pension fund trustees throughout the country and, subsequently, to their pensioners.
Baroness Hollis of Heigham: My Lords, I believe that we have discussed this matter several times in the House. I have no indication whatever that my right honourable friend the Chancellor of the Exchequer is minded to make any adjustment in this respect. However, that is for him to determine. If he should be so inclined, he will of course have the opportunity to do so in the subsequent Budget.
However, I repeat: it was the judgment of my right honourable friend that ACT rewarded dividends and diverted money from investments and that that deformed the economy. As I have stated in this House, it is also the case that the value of ACT was equivalent to approximately one-tenth of the difference a decent manager would make to the fund. In other words, what really matters is the health of the economy and the competence of the management of the fund rather than artificial tax privileges, which distort and deform investment in the economy on which pensions must be based.

Anti-terrorism, Crime and Security Bill
4.48 p.m.
House again in Committee.
Schedule 1 [Forfeiture of terrorist cash]:
Lord Kingsland Lord Kingsland moved Amendment No. 5:
Page 75, line 11, after "currency" insert "whether legal tender or not".
The noble Lord said: In moving Amendment No. 5, I wish to speak also to Amendments Nos. 6 to 15 and 17 to 19. I believe that the noble Lord, Lord Rooker, will speak to Amendments Nos. 20 to 22.
The amendments are largely inspired by the Law Society of Scotland. Amendment No. 5 extends the definition of "cash" for the purposes of Schedule 1. It seeks to ensure that banknotes which are not regarded as legal tender, including counterfeit currency, will come within the ambit of the Bill in relation to forfeiture, seizure and detention of terrorist cash.
Amendment No. 6 probes the circumstances in which it would not be reasonably practicable to seize only the part of the cash which relates to terrorist cash. We would appreciate clarification of the circumstances in which the Government envisage that terrorist cash could not be separated from the whole.
Amendments Nos. 7, 10 and 17 seek to extend the initial period of detention of seized cash from 48 hours to eight days. In our view, authorised officers should be given sufficient time in which to investigate the origin and intended use of such cash. The proposed eight-day period would provide a reasonable time-scale within which to conduct such inquiries and may prevent unnecessary applications for an extension of the detention period.
Amendment No. 8 would ensure that those persons with,
"an interest in the detained cash",
have an opportunity to make representations to the court regarding its continued detention. If cash is to be detained for a maximum of two years, it is appropriate that a person with an interest in the cash should have an opportunity to make representations to the court. Unless such a provision is included in the Bill, the court may make a detention order on the basis of incomplete or inadequate information.
Amendment No. 9 seeks to ensure that the suspect and any third party have a right of appeal and the means to be able to make it. A seizure of funds can have adverse effects on innocent third parties and on legitimate businesses, as well as on the suspect. In our view, there should be a right to representation, funded by legal aid, where necessary, and rights of appeal when the property is seized or subject to a restraint order. The seizure provisions should be subject to PACE codes of practice.
Amendment No. 13 seeks to ensure that the civil procedure to forfeit detained cash cannot take place until,
"criminal proceedings have been concluded or a decision has been taken by",
a law officer not to proceed with the case. We are of the view that the relationship between civil and criminal proceedings should be examined and provision made in the Bill to ensure that consideration is given to an application for civil forfeiture only after a determination has been reached in relation to the criminal prosecution. To do otherwise may, we believe, prejudice evidence that is essential for the criminal trial and subsequent confiscation order.
Amendment No. 14 seeks to make it clear that "forfeiture proceedings" in this part of the Bill are "civil proceedings". It is vital for the nature of the proceedings to be clear in the Bill; that will ensure that an appropriate procedure is used and that the correct regulations are applied for the purposes of legal aid.
Amendment No. 15 provides for "rules of court" to be made to specify the practice and procedure to be adopted in appeals proceedings. Specific provision should be made in the Bill to allow rules of court to be developed for appeal proceedings. Unless that enabling power is included, no provision can be made to govern the procedure of the hearings.
Amendment No. 18 probes the circumstances in which it would be considered appropriate for a court to award compensation under paragraph 10(4) of Schedule 1. If,
"the applicant has suffered loss as a result of the detention of the cash",
and the court is satisfied that it would be reasonable to award compensation, such compensation should be granted. It is difficult to ascertain why compensation should be restricted to exceptional circumstances, as is currently proposed.
Finally, Amendment No. 19 would extend the circumstances in which a person will be held to have obtained property through terrorism. As the Bill is currently drafted, it takes no account of the situation in which a person has acquired property in consequence of an act of terrorism. For example, the situation could arise in which a terrorist purchases or disposes of shares in a company that is subsequently adversely affected by an act of terrorism. That person may benefit from the purchase or disposal, depending on fluctuations in the stock market, as a result of that terrorist activity. Property that is acquired "in consequence or the planned act of terrorism should be subject to the Bill's provisions. The amendment would ensure that such property was covered.
I am greatly reassured by the fact that Amendment No. 5 and many of the amendments that are grouped with it are supported by the noble Earl, Lord Mar and Kellie. I beg to move.
The Earl of Mar and Kellie: Members of the Committee should not take too seriously the fact of my support, which the noble Lord, Lord Kingsland, mentioned. However, that does not mean that I do not

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support the amendments, most of which come from the Law Society of Scotland and 12 of which are in my name.
The noble Lord explained the amendments very well, so I shall mention only Amendment No. 5. I shall be very surprised if that amendment is not agreed to. It draws the Committee's attention to the fact that Scottish banknotes are not legal tender. Unless the amendment is agreed to, it will be perfectly reasonable for terrorists to hold their ill-gotten gains—or otherwise—in Scottish banknotes. I am certain that that is not the Government's intention. I look forward to the Minister's comments.
Lord Williamson of Horton: I, too, want briefly to discuss Amendment No. 5, which deals with the forfeiture of terrorist cash. It is extremely important to include the Scottish point. The provisions should be absolutely watertight. Will the Minister explain whether currency that is not legal tender may be seized, and whether, therefore, the amendment is necessary? Terrorists are likely to be adept at acquiring Scottish notes and at shifting cash between currencies. I very much doubt whether they subscribe to the view that they should save the pound.
I shall give another example. It would be possible to transfer pounds into deutschmarks at the end of December this year. From 1st January those deutschmarks will not be legal tender under German law, but they could still be used for all transactions. That may seem a rather curious position but it would establish a loophole involving the transfer of terrorist cash. The amendment is important, irrespective of the Scottish point, which I also support. I hope that the Minister will make it clear that we do not have a loophole in this context.
Lord Howie of Troon: I, too, support the amendment. The Scottish element was eloquently raised by the noble Earl, Lord Mar and Kellie. It must have been 30 or 40 years ago when Scottish banknotes were acceptable in England provided that one paid a premium of sixpence, I believe, or a shilling, which the English put away in their piggybanks. The note, although not legal tender, was acceptable provided that one paid a sort of fine for using it. I wonder how that applies in this circumstance. Will Scottish notes be acceptable, provided that a premium is paid, as used to he the case 40 or so years ago?
Lord Rooker: I have not got an answer about Scottish banknotes; I make that clear now. This is what parliamentary accountability is all about—that highlights the scrutiny function of Committee stages. We will find an answer to that excellent question. I do not think that my noble friend Lord Howie was making a point about making money out of a premium.
Lord Howie of Troon: No.
Lord Rooker: However, I can see the possibility of doing so.
Lady Saltoun of Abernethy: I thank the Minister for giving way. There is no premium now.
5 p.m.
Lord Rooker: I did not mean it quite like that. I do not want to be misunderstood in Scotland, but I thought there might be another way of making a few bob on the side. In due course I shall move Amendments Nos. 20 to 22.
I shall do my best to respond to the amendments in the spirit in which they were introduced by the noble Lord, Lord Kingsland. I accept that most of them are probing amendments. I shall seek to answer the points raised. We shall have to return to Amendment No. 5 once I have taken advice from my learned friends about Scottish banknotes.
We do not believe that Amendment No. 5 is necessary. Where cash, for example, was known to be counterfeit it would be liable to seizure under normal criminal law for investigation of an appropriate offence. Where it was not known to be counterfeit it might be seized unwittingly in accordance with the Schedule 1 scheme, but once it was discovered to be counterfeit, it could be dealt with under the other powers. We do not believe there is any need for the cash seizure scheme to cover cash which is not legal tender. Powers to deal with such cash and remove it from circulation already exist. I say that on the basis that I shall come back on the point regarding Scottish banknotes. Therefore, I do not believe that Amendment No. 5 is necessary. It is possible that cash could be used for funding various activities. However, we believe that that is taken account of under existing provisions.
I turn to Amendment No. 6. The effect of removing subparagraph (2) would be to deny an authorised officer the possibility of seizing, for example, a traveller's cheque where he knew it was not completely terrorist cash. That is the one example I have. Paragraph 2 caters for instances where the authorised officer may not be able to divide cash into that which he has reasonable grounds to suspect to be terrorist cash and that which he does not; for example, where a traveller's cheque is seized.
That might arise where the officer has intelligence that part of the traveller's cheque was bought with legitimate money and part was bought with the proceeds of terrorism. It is important that the terrorist part of the cash in such circumstances is seized. The effect of the amendment would remove that possibility. Once the cash in the circumstances I outline was paid into an account, which must happen within 48 hours, paragraph 4(2) provides that the non-terrorist part must be repaid. We do not believe, therefore, that the amendment is necessary. I hope that the example I have given explains why the provision is in the Bill.
I turn to Amendment No. 9. It is not wholly clear whether the amendment relates to appeals against forfeiture of seized cash or to the restraint orders made under Part 2 of Schedule 1 to the Bill. In the case of a forfeiture order, any other party to the proceedings who is aggrieved by the order may appeal against the order to the Crown Court. That would include the

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person from whom the cash was seized and also possibly a victim of criminal conduct who claimed that the cash belonged to him.
In the case of a restraint order made by the High Court, anyone affected by the order may appeal to the Court of Appeal. In the case of an appeal against the forfeiture order to the Crown Court, Clause 2(2) of the Bill ensures that legal aid will be available for such proceedings. Likewise, anyone affected by a restraint order can apply to the High Court for the order to be varied or discharged where civil legal aid provisions would apply and a person would be able to appeal from a High Court decision to the Court of Appeal in the normal way. I hope that that will satisfy the noble Lord.
Amendments Nos. 7, 10, and 17 seek to extend the period from 48 hours to eight days. We believe that 48 hours is an appropriate length of time and follows, as I said earlier, the longstanding precedent set out in the drug trafficking provisions dating from 1990. The provision has been used and we have every reason to believe that it has worked extremely well.
At the 48-hour point, an order for continued detention can be made if there are reasonable grounds for suspecting that the cash is terrorist cash and that an investigation into the cash or criminal proceedings is underway. We do not believe that it is appropriate to allow cash to be detained for eight days before a court hearing takes place. I am not sure why the period mentioned is eight days. I have not had the advantage of the briefing. If the answer is not satisfactory, perhaps the noble Lord will come back on that point.
I turn to Amendments Nos. 8 and 11. The person with an interest in the cash seized and detained who claims that the cash seized or part of it is not terrorist cash already has a remedy under the provisions of the Bill and under the revised magistrates' courts' rules. We agree with the sentiment of the amendment. It is right in principle that persons affected by seizure should he able to make the court aware of their concerns. That is why paragraph 3(4) of Schedule 1 ensures that the order for the detention of the seized cash must provide for notice to be given to persons affected by it. Furthermore, the revised magistrates' courts' rules will enable those who are given notice under paragraph 3(4) to make representations. The timescales involved for the first hearing will not mean, however, that the opportunity to make representations at that point will be possible. For those reasons, we see no need for the amendment.
The effect of Amendment No. 12 is to do away with the requirement to place certain instruments—the subject of seizure—in an interest-bearing account on the simple grounds that it is not possible to do so. We believe that the amendment is aimed at the fact that it may be difficult to pay some of the instruments defined in paragraph 1(2) as being cash into an interest-bearing account.
I understand that it is possible to pay all types of monetary instruments defined as cash under paragraph 1 of the schedule into such an account.
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Bonds and bearer shares will first have to be converted to cash. If the definition of "cash" is extended using the order-making power under paragraph 1(3)—I am not making law on my feet, but I suspect that provision may have to be extended to cover such bank notes as were referred to earlier—we would ensure that any additional instruments could also be paid into an interest-bearing account.
It is important that cash is paid into an interest-bearing account. There is a simple reason for that. It will avoid the possibility of paying compensation in lieu of interest if a forfeiture order is not made. Therefore, we see no need for the amendment.
Amendment No. 13 seeks to link the terrorist cash seizure scheme with criminal proceedings. We believe that that would be a big mistake. It is not appropriate to make that link as the seizure scheme stands alone. It is not part of the criminal proceedings that might or might not follow. The seizure scheme is a civil scheme focusing on the cash. It has nothing to do with the individual, his guilt or innocence. It would be a mistake to link those. It may be that an individual linked to the cash is facing proceedings for terrorism matters. However, that will not necessarily be the case. Cash might be found without anyone present or any obviously identifiable owner; or the carrier of the cash which may be used for terrorist purposes may be wholly innocent. Therefore, such a link would be a mistake. There is no link between the cash proceedings and any criminal proceedings. That is why Clause 1(2) provides that the powers in Schedule 1 are exercisable in relation to cash whether or not proceedings have been brought for an offence in relation to the cash. The amendment would undermine Clause 1(2). For those reasons I hope that the noble Lord will reconsider and, in due course, not move the amendment.
Amendment No. 14 seeks to make forfeiture proceedings under Part 3 of Schedule 1 to the Bill civil proceedings. I draw the noble Lord's attention to that. I realise that the Bill has been rewritten and slightly changed from how it was in the other place. But the issue is already on the face of the Bill in Clause 1(1). It refers to forfeiture in civil proceedings. Therefore, that matter is actually covered.
Amendment No. 15 proposes that the rules of court make provision as to the practice and procedure in connection with proceedings relating to forfeiture. A power to make relevant rules of court is already available by virtue of Section 144 of the Magistrates' Courts Act 1980 and Section 84 of the Supreme Court Act 1981. Rules governing the procedure in relation to detention and forfeiture of terrorist cash were made under those provisions when the Terrorism Act 2000 came into force earlier this year. That was despite the express reference to another rule-making power in Section 31 of the Terrorism Act 2000. The question which immediately comes to mind is why is it necessary to have this duplication? I do not have the answer. However, the fact is that the rule-making provisions are there. We therefore do not believe that the amendment is necessary.

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Amendment No. 18 concerns compensation in paragraph 10 of Part 4 of the Schedule. If a person's cash is detained but not ultimately made the subject of forfeiture, interest is paid. But if the cash was not put into an interest-bearing account he may be paid compensation in lieu of interest in accordance with the rules set down in paragraph 10(2) of Schedule 1.
The amendment is concerned with the circumstances in which additional compensation may be paid. There are bound to be wholly exceptional circumstances where the normal interest is not sufficient compensation. I have in mind circumstances where a person's cash was detained, and so was unavailable to him, and then was subsequently returned, but that cash had been part of a successful business deal—for example, the buying and selling of a house—and the deal had fallen through to the extent that there had been a considerable loss; in those circumstances he would have grounds for seeking compensation outside and above the interest. But those would be very exceptional circumstances.
There is a lower test for compensation. If we have a lower test, such as that implied in the amendment, then authorised officers may be fearful of making the seizure orders because they might be responsible for large pay-outs. Given the seriousness of the issues at stake, it is not right to bind them in the way that the amendment proposes. Nevertheless, where there are exceptional circumstances, compensation would naturally be payable.
I was not completely clear as to precisely what type of cash Amendment No. 19 was designed to catch. The noble Lord gave an example but the amendment seems to go much wider than the current definition of "property obtained through terrorism" in paragraph 11(1) of Scheclule 1. Property obtained by or in return for acts of terrorism might have been payment for committing a murder. Obtaining property by or in return for acts carried out for the purposes of terrorism might include stealing a car to perpetrate a terrorist act. The purpose of bringing cash which is the proceeds of terrorism within the scheme—in addition to cash which is intended for use in terrorism and cash which belongs to proscribed organisations—is to prevent terrorism. In many cases the proceeds of terrorism are recycled to further terrorist causes. To cast the net too wide would make it difficult to justify cases; for example, how would forfeiting proceeds in the above example of the bargaining of property help to prevent terrorism? Therefore, we cannot support the amendment.
The point is that we are dealing with a civil scheme. We must separate the issue from the people concerned. The people concerned who are linked to the cash, however tenuously, may be wholly innocent, even though it is subsequently proved that that cash was deployed for terrorism.
Amendments Nos. 20, 21 and 22 standing in my name make simple additions to Part 5 of Schedule 1 to the Bill. They tidy up the definition of "property earmarked as terrorist property". Members of the Committee will be aware that Schedule 1 sets out the
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scheme relating to the cash forfeiture. Part 5 explains when the cash which is, or represents, property obtained through terrorism, falls within the scheme.
Amendments Nos. 20 and 22 are simple drafting amendments. Amendment No. 21 ensures that where property falls outside the scheme and is exchanged for other property, that property also falls outside the scheme. For example, where property obtained through terrorism is sold to a bona fide purchaser who has no idea of its origins, that property will fall outside the scheme by virtue of paragraph 16(1) of Schedule 1. If the bona fide purchaser sells the property in return for cash that cash too will fall outside of the scheme. The amendment ensures that that is the case. I hope that in due course Members of the Committee will accept the three amendments.
5.15 p.m.
Lord Howie of Troon: Before my noble friend sits down, perhaps he can clear up a point for me. When he refers to "cash", does he include under that term "currency" whether legal tender or not?
Lord Rooker: On page 75 of the Bill cash means,

"(a) coins and notes in any currency,

(b) postal orders,

(c) cheques of any kind, including travellers' cheques.

(d) bankers' drafts,

(e) bearer bonds and bearer shares, found at any place in the United Kingdom".

It must be cash that is legal tender because if it is counterfeit cash or is not legal tender, it would not be covered. That is why I am seeking urgent advice on the first question that I was asked about Scottish banknotes.
The Earl of Mar and Kellie: Perhaps I could ask the noble Lord to go back to his answers on Amendments Nos. 13 and 14. They were aimed at establishing that forfeiture would be, certainly in Scotland, part of the civil law proceedings. I became slightly confused by what the noble Lord was saying. Can he confirm that forfeiture will be a civil matter?
Lord Rooker: Criminal proceedings and the scheme for the seizure of terrorist cash are two entirely separate processes. Therefore, we do not want a link between the two. We are dealing here with cash seizures which are preventive measures. They stand entirely independently of criminal proceedings. So the latter is simply not relevant to the seizure schemes. The key issue concerns terrorist cash. I hope that I have made that clear. Amendments Nos. 13 and 14 deal with civil procedures. Criminal procedures are prosecutions for acts of terrorism. They are quite separate. We should not make a link between the two.
Lord Williamson of Horton: I know that the Minister will return to Amendment No. 5. I specifically raised the point about the German currency. It is a very important currency. Huge amounts of money can be shifted in it. From 1st January the deutschmark will

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not juridically be legal tender. In that case apparently it could not be seized. None the less, early next year one can go into Germany and buy a huge house with deutschmarks. That is the German law. Currency which is not legal tender will be usable for a period of some months.
Lord Rooker: I shall take further advice on that matter and come back to the noble Lord. Like most other sane people I have looked at what foreign currency I have been hanging on to having seen the list of dates by which some European currencies will not be legal tender. There is a gap with some currencies. They will cease to be legal tender but can still be paid in through the banking system. Therefore, it may be that there is a satisfactory answer so far as the deutschmark is concerned.
Schedule 1(2) does not refer to sterling. It states:
"'Cash' means … coins and notes in any currency".
One assumes that they are legal tender, but if there is a gap because of the transfer to the euro—which is possible, because the dates are not the same in all European countries, as I discovered last week after reading a leaflet from the Department of Trade and Industry—there is a mechanism. That cash must go through the banking system in order to be exchanged—that may be the way around that problem. However, I shall take advice and write to the noble Lord on that point.
Lord Kingsland: First, I thank the Minister for giving such a full reply on the many amendments that have been grouped together. I shall briefly respond to what he has said.
First, on Amendment No. 5 and legal tender, the Minister kindly said that he will reflect on the situation regarding Scottish banknotes. I trust that that applies also to the point made about German currency by the noble Lord, Lord Williamson of Horton.
The Minister said that he was content to rely on the criminal law in relation to counterfeit currency. I wonder whether that is the ideal approach. The specific procedure here is a civil procedure. In dealing with other amendments, the Minister has been at pains to emphasise the distinction between the civil and the criminal and the importance of limiting this part of the Bill to civil procedure. Yet, in his reply on Amendment No. 5, he admits that counterfeit funds are a matter for criminal law.
I do not want to make a cheap debating point, but that affects the logic of his position on the importance of civil procedure. Will he further consider the position of counterfeit funds before Report? The point is not just the distinction, in principle, between criminal and civil law but that the criminal rules in relation to counterfeit funds may not be as expeditious as are the civil rules laid down in the schedule.
Lord Rooker: In seizing the money, having received advice or intelligence or conducted investigations, the authorised officer may come across other possible
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crimes—not just counterfeiting of money but other criminal activities completely outwith the seizure. The authorised officer would then report to the authorities evidence of criminal activities for investigation. If other possible crimes are discovered—the example that we discussed was the crime of forging banknotes—that does not nullify the fact that the seizure of money is a civil procedure.
Lord Kingsland: With the greatest possible respect to the Minister, that is true but beside the point. The Minister accepted that the present wording does not cover counterfeit money. He also told your Lordships that seizing funds is a civil law issue. I simply suggest to him that he may want to reflect on the matter before Report.
As to Amendment No. 13, which the noble Earl, Lord Mar and Kellie, seized after the Minister's reply, the Minister was at pains to say that the scheme was civil and had nothing to do with criminal law and criminal guilt. I draw the Minister's attention to Clause 1(1). That defines the circumstances in which cash can be seized in terms of terrorist acts, which are indisputably criminal. If the definition of the cash is itself intimately connected with the criminal law, is it not difficult to envisage how the two regimes will remain separate?
Lord Rooker: Schedule 1 sets up a scheme to deal with the cash. It is a stand-alone scheme. That is the whole point. The cash may be taken in pursuance of investigation before all the evidence is available. It is a stand-alone, civil scheme, and there is no connection between it and the terrorist activity that the cash may be thought to be funding.
Lord Kingsland: Whether or not the scheme, in any particular case, follows its logic through to the final act of forfeiture, the extent to which it moves down that route will depend on a judgment on whether a criminal act has been committed. The nature of that criminal act will be determined in the context of Clause 1(1). Perhaps the Minister will return to that point on Report.
Lord Rooker: I can help the noble Lord. By the way, it goes without saying that I shall reflect before Report on everything that is said in Committee. We must because of the process: issues will be raised that no one has contemplated. I shall be happy to reflect, but I shall read out the latest note that I have received from the Box, because it is helpful. It states:
"The origin of the cash might well be criminal. But that does not mean that the person carrying the cash is a criminal."
We must separate out the issues. Cash to fund terrorist activities may not be carried by terrorists. Wholly innocent people may carry cash that is the result of criminal activity.
Lord Kingsland: I entirely accept that, but I suggest to the Minister that that in no way undermines my point.

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I have two other reflections on the Minister's response. On Amendment No. 15, he rightly pointed out that the rules of procedure in our courts cover the issue raised by the amendment. Will the Minister—either now or later—tell us whether that is also true of Scottish law?
Amendment No. 18 concerns the question of exceptional loss. The Minister rightly said that it covers matters other than the payment of interest, and went on to give an example in which, in effect, someone would have the right in law to damages. He was reluctant to state that in terms in the Bill, because he felt that that might act as a disincentive to those officers tasked with the act of seizure. Ought your Lordships to endorse a statement by the Minister to the effect that public officials would be influenced in that way?
Lord Rooker: Public officials making decisions under law are always aware that they must take account of consequences such as the cost of their actions and issues such as value for money. We do not want a lower test for compensation. There is a severe test for compensation, but we do not want to lower it.
I gave a couple of examples of wholly exceptional cases: a business deal and a house purchase. If money was withheld from someone and they were unable to conduct their deal or purchase, and the money was then returned because it was not terrorist cash, they would clearly have a good claim. That is fair; I accept that. We do not want to lower the test for compensation, as would the amendment, simply because officers taking decisions on the margin about an amount of cash and the circumstances might err on the side of being too cautious. We are in deep water in searching to obtain terrorist cash. The procedure is new and it would be wrong to lower the test.
Lord Kingsland: As regards human rights, I see the importance of officers being cautious. However, I suggest to the Minister that where an officer finds a legitimate set of circumstances for seizing cash, he should not be put off pursuing his duty by the fact that it might cost the Treasury a little more money than if the Bill were constrained by the current draft.
Finally, I turn to Amendment No. 18. The Minister's reply is a good illustration of why cash conversion—that is, the route it takes into other forms of property or activity—should be traced by a High Court judge and not by a magistrates' court. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
5.30 p.m.
[Amendments Nos. 6 to 19 not moved.]
Lord Rooker Lord Rooker moved Amendments Nos. 20 to 22:
Page 80, line 28, leave out "Property" and insert "Earmarked property obtained through terrorism"
Page 80, line 38, leave out "the original property or of and insert "earmarked property, whether the original property or"
Page 81, line 1, after "of" insert "earmarked"
On Question, amendments agreed to.
Schedule 1, as amended, agreed to.
Clauses 2 and 3 agreed to.
Schedule 2 [Terrorist property: amendments]:
Lord Kingsland Lord Kingsland moved Amendment No. 23:
Page 85, line 19, after "that" insert "each of the requirements for the making of the order is fulfilled"
The noble Lord said: Amendment No. 23 is part of a series of amendments which alters the procedure for applying for account monitoring orders and the criteria which must be met before such applications can be granted. The amendment makes specific provision in relation to the requirements which must be complied with before an account monitoring order can be made.
We believe that an essential requirement has been omitted from the criteria for consideration listed in paragraph 2(1). Reference should he made to the fact that the applicant has reasonable grounds for believing that an audit is likely to be of substantial value to the investigation. We therefore propose an altered wording in the subsequent amendment to include that requirement and to reflect the drafting of an analogous clause in the Proceeds of Crime Bill. If account monitoring orders are to be available under the proceeds of crime legislation as well as tinder this measure, and if the policy intention behind the orders is uniform, it is important that the provisions are broadly similar.
Amendment No. 25 makes it clear that an account monitoring order need not be intimated to the holder of the account. The rationale behind the orders, as I understand them, is to allow the appropriate officer to monitor transactions in relation to an account over a period of time without the account holder's knowledge. They are an extension to the production order procedure applicable under the Proceeds of Crime Bill.
The new Proceeds of Crime Bill makes specific provision in Clause 367(3) that an application for a production order need not he intimated to the person specified in the application. This part of the Bill is, however, silent in regard to intimation. In our view, in order to avoid ambiguity as to whether intimation is required for the purpose of the account monitoring order, it is preferable to specify the position on the face of the Bill.
Amendment No. 26 specifies what information should be included in the information for an account monitoring order. We take the view that an application for an account monitoring order should specify that the person named in the application is subject to a terrorism investigation and that the order is sought for the purposes of that investigation. As currently drafted, these criteria are not referred to as essential elements of the application. Amendment No. 26 seeks to rectify the position and ensure that the drafting of the clause in this respect will reflect the terms of the analogous provisions in the Proceeds of Crime Bill.
Amendment No. 28 seeks to introduce the definition of "account information" for the purposes of the clause. The concept of account information is

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central to this part of the Bill and it is, therefore, important that a clear definition of the phrase is stated on the face of the Bill. The amendment merely seeks to do that; and in doing so replicates the definition in the analogous clause in the Proceeds of Crime Bill.
Amendment No. 29 details the requirements which must be satisfied before a judge can make an account monitoring order. Our view is that, before an account monitoring order can be made, the judge should be satisfied not only that there are reasonable grounds for suspecting that the person specified in the application has committed a terrorist offence, but also that there are reasonable grounds for believing that the accounts information will be of substantial value to the investigation. As currently drafted, the Bill makes no provision for those criteria. The amendment seeks to address that and again reflects the drafting of the analogous clause in the Proceeds of Crime Bill.
Amendment No. 30 probes the circumstances in which it is envisaged that the description of information in an application could subsequently be varied. We are not satisfied that the description of information specified in an application once granted should be capable of being varied by anyone other than the court. The initial application must be granted by the court and any application to vary or discharge should be considered only by the court and not altered unilaterally on the part of the applicant. If the applicant requires further information to be included, a new application should be submitted and efforts made to ask the court to vary the existing order.
Amendment No. 31 makes provision to ensure that information which is subject to legal privilege will not be disclosed under this part of the Bill. Article 8 of the European Convention on Human Rights enshrines the right to privacy. The law is keen to protect the relationship between a solicitor and his or her client and has made provision for the doctrine of legal professional privilege. In order to preserve that relationship, and ensure that such information and communications are privileged, provision should be made on the face of the Bill to the effect that an account monitoring order will not extend to the disclosure of information subject to legal privilege.
Amendment No. 32 introduces an additional consideration which the Court of Session must take into account in determining whether to make a restraint order. Paragraph 3 extends the current restraint procedure to enable restraint orders to be granted at an earlier stage in the proceedings. We appreciate that the extension of the procedure may be necessary, in some cases, in order to prevent the disposal of the proceeds of terrorist crime prior to the institution of proceedings.
However, due regard must also be had to proportionality and the extent of the evidence available at the investigatory stage. In order to balance the degree of interference which a restraint order imposes in relation to a suspect's property at the early stage of investigation, an assessment should be made as to the likelihood of the assets or property concerned being disposed of at that point. If there is a substantial
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risk that the property will disappear, or some other factor which suggests a degree of urgency, an application for restraint should be made. The amendment seeks to ensure that any action taken is proportionate.
Amendment No. 33 provides for disclosure to a constable or nominated officer as soon as is reasonably practicable. As currently drafted, the Bill provides that a person commits an offence under paragraph 5 of Schedule 2, Part 3, if, inter alia, he or she does not disclose the information to a constable or nominated officer as soon as is practicable after the information comes to him or her. There may, however, be situations in which a person cannot make the disclosure, as soon as would otherwise be practicable, for good reason. In these circumstances, it may be inappropriate to render that person criminally liable. To reflect that, we propose that the offence is restricted to situations in which disclosure is not made as soon as is reasonably practicable.
I turn to Amendment No. 34. Paragraph 5 of Schedule 2 inserts new sections in the Terrorism Act 2000 and creates the offence of failing to disclose information relating to certain criminal activities under that Act. The new section imposes a duty on a person to disclose information which leads him to suspect that another individual has committed a terrorism offence. We support the introduction of that new offence but do not see the point of imposing a duty on a person to disclose certain information if it is already in the public domain.
For example, suppose that a bank is given information to the effect that Osama bin Laden is a terrorist and has committed one of the offences referred to in the Terrorism Act 2000. If that information comes to the attention of the bank by various means in the course of its business, as it may well do, it will be under a duty to disclose it to a constable or nominated officer. If it fails to do so it will commit an offence. The result is that the constable concerned or nominated officer will be showered with information which is already in the public domain.
The constable concerned or nominated officer will have to trawl through documents to find information that is not in the public domain. The task of so doing, if banks are to honour these provisions, as we trust they will, may be too much for the constable concerned or nominated officer and he may miss valuable information which would prevent further acts of terrorism. We therefore propose that information that is already in the public domain need not be disclosed.
As to Amendment No. 35, if a person knows or suspects that another has committed a terrorism offence it is important that he discloses the information on which that is based to a constable or nominated officer as soon as is practicable. That disclosure may lead to further inquiries and the prevention of other acts of terrorism. It is conceivable that the disclosure of such information will lead to the saving of thousands of lives.
However, we believe that it would be unfortunate if the person who made the disclosure informed the terrorist that he had done so. The terrorist could then

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take the appropriate precautions to avoid further detection and carry out further acts of terrorism. We see no conceivable reason why he should be told that such a disclosure has been made. Accordingly, we suggest that the person who makes the disclosure should not inform the suspected terrorist that he has made it.
We are also concerned that any such person should not be deterred from keeping the disclosure from the suspected terrorist. The sole aim is to catch terrorists and prevent further acts of terrorism. A person who makes a disclosure, but does not tell the suspected terrorist, should not be in fear of any repercussions. Accordingly, we propose that a person who has made a disclosure but does not inform the suspected terrorist should not risk civil or criminal proceedings for failing to do so. I beg to move.
5.45 p.m.
The Earl of Mar and Kellie: I support the amendments spoken to by the noble Lord, Lord Kingsland. Again, almost all of them come from the Law Society of Scotland. They reflect the fact that both the Proceeds of Crime Bill and the present measure are passing through this Parliament for Scotland on the basis of a Sewel Motion. This means that the Scottish Parliament has given up the right to scrutinise the Bill. This legislation is, after all, concerned largely with criminal justice which is clearly a devolved matter. I hope that the Minister takes these amendments extremely seriously because we must get the Bill right for Scotland.
Lord Rooker: I hope to take all the amendments seriously. I appreciate that use has been made of the Sewel Motion. The decision has been made in Scotland that the legislation on these issues should be considered in Westminster. While that agreement has been freely entered into, it does not mean that we do not take the issues seriously because Westminster is to consider the legislation.
I am grateful to the noble Lord for the way he dealt with the amendments. I shall do my best to answer the points that he made. I shall try to keep to the same order, although I have a separate note that is out of kilter. I deal with Amendments Nos. 23 to 29 as a group. The Committee will be aware that Part I of Schedule 2 sets out the scheme relating to the monitoring of bank accounts of terrorist suspects for up to 90 days. This provides for real time disclosure of transactions and other information which will assist the police in their investigations.
The amendments tabled by the noble Lord in large part replicate the clause without changing the substance of the provision, but we believe that where they make substantive changes they are to the detriment of the functions. The principal change that is effected by the amendments is that the grounds that must be satisfied before an order can be made are amended and, in certain respects, the threshold is increased. The amendments remove the existing grounds to be satisfied. Those grounds are the same in substance as those required before the financial order
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can be made under Schedule 6 of the Terrorism Act 2000. We are trying to mirror the Terrorism Act 2000 as much as possible.
I accept the point about consideration of the Proceeds of Crime Bill in another place. It will be months before that Bill comes to this House—I am unable to forecast its shape—but the Terrorism Act is already on the statute book. We see great benefits to the courts, the police and the financial institutions in framing the powers in this Bill in terms similar to those in the Terrorism Act. In the course of an investigation the police may well use financial information to identify the existence of accounts held by a specified person and use an account monitoring order to obtain disclosure of information relating to the account.
The essence of the difference in approach between noble Lords and the Government is two-fold. First, the court would not be able to make an order unless satisfied that there were reasonable grounds to suspect the person specified in the order of a terrorist offence. Secondly, the police must demonstrate that the information to be obtained would be of substantial value to the terrorist investigation. Put in that way, on the surface they sound reasonable if one forgets the context of the Bill. As to the first point, it assumes that the person specified is suspected of an offence. That may well be true in the majority of cases, but it is not necessarily so. The police may well wish to obtain information relating to transactions on an account when the account holder—the specified person—may be innocent and is perhaps being used by others for terrorist purposes. The amendments tabled by the noble Lord would preclude the use of an order in such cases.
Even in those cases where the person specified is the suspect, the requirement to have reasonable grounds would preclude the use of this investigatory tool at an early stage in the investigation when it might not be possible to establish such reasonable grounds. We are not being unreasonable. These account monitoring orders are approved by a judge. This is not the Government and the police going off willy-nilly.
The purpose of the order is to help deal with terrorist crime and the financing of terrorists. We need the order to assist in the investigations of an inquiry. To that extent, of course, the investigation is the means of establishing the reasonable grounds for believing offences may be committed. In the early part of an inquiry, the reasonable grounds test may not be met, but it would be sufficient under the terms of the schedule for the judge to grant the order.
The second essential difference to which I referred—that the order must be of substantial value to the investigation—again imposes a different test in relation to the account monitoring orders than that which exists in the financial orders under the Terrorism Act at the moment. As I explained, we see real benefits in keeping the two procedures similar. To use a different formulation would lead to questions as to whether one is intended to be more stringent than the other.

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In so far as the noble Lord seeks to raise the threshold for the granting of an order, the Government feel that this would greatly limit its value to the police in their important work of combating the funding of terrorism. We believe it is right that the police should demonstrate that the order will be of value—this is already provided for—but we do not think it should go any further than that.
As to Amendment No. 25, the purpose of the account monitoring order is to investigate a suspected terrorist without indicating to the holder of the account that he or she is being investigated. The amendment tabled by the noble Lord seeks to make clear that the police, when making the application, need not tell the person to whom the application relates. The Government agree that this should be the case. That is why the application is made ex parte without telling anyone else. The amendment does not take the matter any further at all. The police certainly do not need reminding that the whole purpose of the account monitoring order is to examine someone's finances without alerting that person to the investigation.
It may assist the Committee if I make clear that the court rules will require the court to serve notice of the order, if made, on the financial institution but not on the person specified in the application. I hope that this explanation satisfies the noble Lord.
Amendment No. 31 seeks to provide for the circumstances where a financial institution would want to refuse to provide information on the grounds of legal privilege. The information which would be disclosed by virtue of an account monitoring order would relate to the account—principally, details of transactions. We cannot see any occasion when such information would be legally privileged. We believe, therefore, that the amendment is unnecessary.
Amendment No. 32 seeks to spell out for Scotland what is inherent in the process by which the Court of Session comes to make a restraint order—in other words, the court must have reasonable grounds for suspecting that property will be disposed of prior to the conclusion of proceedings. This is another way of articulating the civil standard of proof on which the Court of Session has to be satisfied before it makes the restraint order.
As the Committee will know, a restraint order is in the nature of an interim or temporary provision. Any judge will require to be satisfied, on reasonable grounds, that the property concerned is likely to be disposed of, but it would be unusual—and unduly selective in this context—to make the express provision contemplated in the amendment.
I say that for the following reasons. First, the amendment concerns Scotland only, but there are comparable provisions for England and Wales at paragraph 2(2) of Schedule 2 to the Bill and for Northern Ireland at paragraph 4(2), and no amendment is proposed for those provisions. There is a clear implication that there is a Scottish speciality here when in fact there is none whatever.
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Secondly, no comparable express requirements are proposed for Scotland in relation to the power of the Court of Session under paragraph 18(1) of Schedule 4 to the Terrorism Act 2000. This also concerns the power of the Court of Session to make a restraint order, so there is a further clear implication of a speciality for this particular power only, which is incorrect.
I am grateful for the opportunity to make clear that a court will have to be satisfied, on a civil standard of proof, that a restraint order is necessary because the property concerned may otherwise be disposed of in the interim. I hope that, in due course, noble Lords will withdraw those amendments.
Amendment No. 34 relates to the information order being in the public domain. The Bill provides that a person does not commit an offence if he has reasonable excuse for failing to disclose. This would be capable of covering a case where a person believed the information to be so widely available that it did not need to be passed to the police. The provision provides a way to assess whether a person should be relieved from his criminal liability—that is, was it reasonable for him to act as he did. This is the proper way to deal with what the amendment refers to as "information in the public domain".
It is a wholly reasonable amendment for the noble Lord to table. In the case of wide-spread, publicly available information, it would be quite preposterous to consider that someone had committed an offence because he did not pick up a phone, ring the police and say, "By the way, do you know about this?" I hope the Committee will think that there is an adequate defence.
Amendment No. 35 has a sensible aim. It seeks to ensure that a person who knows or suspects another of committing an offence does not tip off that other person to the fact that the police have been informed. The amendment also seeks to provide protection for a person disclosing information to the police should civil or criminal proceedings be brought against him for doing so.
The first aim is already adequately achieved by the existing provision in the Terrorism Act 2000. Section 18 provides that it is an offence for a person to enter into or become concerned in an arrangement which facilitates the retention or control by another of terrorist property. The Government believe that this provision addresses the concerns behind the noble Lord's amendment. After all, the whole schedule is an amendment to the Terrorism Act, and therefore we believe that that aim is taken care of.
I have come to the end of the amendments—although I may have missed one out—but the noble Lord raised the issue of an order not being varied by the applicant after the order is made. We agree with him. I regret that I am not sure which amendment this related to, but the provisions sought to be deleted provide for a variation of the description of the information in the application—that is, a variation before the order is made. Once made, the variation to

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any order must be made by the court. I want to make that absolutely clear and I am glad that I have had the opportunity to put it on the record.
Lord Kingsland: I shall be telegraphic in the few remarks that I am about to make before I withdraw my amendments.
I thank the Minister for drawing my attention to the parallel which the Government are drawing with the Terrorism Act 2000 rather than with the Proceeds of Crime Bill, which is the parallel that has informed many of these amendments. I shall obviously reflect on that issue. I am grateful to the noble Lord.
As to the question of reasonable grounds, the noble Lord went on to say that the grounds for making such an application would not be "unreasonable". I am tempted to ask the noble Lord whether he sees any gap between reasonableness and unreasonableness. There must be some gap, otherwise the Minister would not have resisted my insertion of "reasonable". I shall re-table the amendment. Perhaps between now and Report stage, which is not very far away, the Minister may wish to come back on that point. This is an important matter—the influence of the word "reasonable" over the conduct of public officials.
The noble Lord was reassuring on the question of legal professional privilege. My noble friend Lady Buscombe will be returning to this point at a later stage and in a different context. I ask the Minister to reflect between now and Report whether he really thinks that the fact that it is unsaid is sufficient protection in the context of legislation which has international ramifications, and where legal privileges are viewed in a different light in different countries.
Finally, on the question of "reasonable" excuse for failure to disclose—the question of the public domain—here we have reversal of the burden of proof. Normally, that is legitimate in circumstances where the facts that compose the excuse are uniquely in the domain or knowledge of the accused. I wonder whether, in the circumstances of "public domain", that matches the normal circumstances in which the courts are prepared to tolerate reverse burdens of proof.
I am grateful to the Minister for taking particular care over responding to the amendments. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 24 to 36 not moved.]
Schedule 2 agreed to.
Clause 4 [Power to make order]:
6 p.m.
Lord Goodhart Lord Goodhart moved Amendment No. 37:
Page 3, line 8, after "action" insert "involving terrorism"
The noble Lord said: This is a probing amendment. Clause 4 as drafted allows a freezing order to be made if a foreign government or resident is likely to take,
"action to the detriment of the United Kingdom's economy (or part of it)".
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That expression is extraordinarily wide. Perhaps I may give an example. A Japanese company is considering whether to build a new car manufacturing plant in the United Kingdom or in Switzerland. The Swiss Government offer the company a financial inducement to build its plant in Switzerland—something in the nature of, say, a tax holiday.
That is plainly action to the detriment of the United Kingdom economy. The result is that, at least in theory, the Treasury could make a freezing order stopping anyone in the United Kingdom, or United Kingdom nationals resident abroad, from making payments to the Swiss Government. Some people might say that that was quite right, but I am sure that it was not the intention. I want to probe why such a wide-ranging clause has been adopted.
I expect to be told that the reason is Chat the wording was drawn from Section 2 of the Emergency Laws (Reenactments and Repeals) Act 1964, the section being repealed by the Bill and replaced with this provision. I accept that the wording is drawn from that section. But Section 2 of the 1964 Act dealt with a much narrower issue. It covered the case where a foreign government made an order requiring someone to make a payment or to transfer gold or securities to them and the United Kingdom Government was, under the 1964 Act, given power to block anyone within United Kingdom jurisdiction from complying with the foreign government's order. So the reference in that case to,
"action to the detriment of the United Kingdom's economy",
had a much narrower scope than the new one does. Indeed, the 1964 Act goes back to the days of exchange control. I suppose that the reference to gold is a reference to the days when gold had some real monetary function.
The result is that, whereas the wording was not excessively wide in relation to the 1964 Act, it is wholly excessive when applied to Clause 4 of the Bit. Therefore, Amendment No. 37 requires the action which is to the detriment of the United Kingdom economy to be action "involving terrorism". I assume that that is the main part of what is specifically intended by this clause. It is not necessarily the right way, but I believe that the Government should ask the draftsman to re-examine the clause. As it stands, it is so excessively wide as to be unsatisfactory. I beg to move.
Lord Renton: Before the Minister replies, perhaps the noble Lord, Lord Goodhart, will bear with me for a moment. He seeks to insert into Clause 4 the words "involving terrorism", whereas the clause deals with matters to the detriment of the economy.
We are entitled to look to the Long Title to help us to interpret the Bill. It is intended,
"To amend the Terrorism Act 2000; to make further provision about terrorism and security",
and, as a separate item,
"to provide for the freezing of assets".

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That is what Part 2, and especially Clause 4, purport to do. To insert the words "involving terrorism", would limit the application of Clause 4, and that would be unfortunate.
Lord Goodhart: I am grateful to the noble Lord, Lord Renton, for raising that point. He is right. The Long Title of the Bill does contain the words,
"to provide for the freezing of assets".
But my amendment as drafted was not intended as a final version. Its purpose is to raise with the Government the point that the power in Clause 4 goes so wide that it must go far beyond anything that it is intended to achieve. It seems to me that the Government should restrict the drafting of the clause. I accept that the Government's objective here may not be limited to terrorism, although no doubt it includes it. I should like them to accept, however, that the present wording is excessively wide and to reconsider it.
Lord Elton: I find myself surprised and rather alarmed to be in disagreement with my noble friend Lord Renton—possibly for the first time in my parliamentary career. I feel very strongly that emergency legislation should be restricted to the emergency to which it relates. To say that it is wrong to restrict it to that purpose seems to me—if I may respectfully say so—to be misguided.
My position is that one should not give more to a government legislating ventre à terre than is absolutely necessary—because everything that is given to them is scarcely considered. If it does not relate directly to the stated purposes of the legislation, it should not be given.
Lord Renton: I say with deep respect to my noble friend that he may not have realised that the words "involving terrorism" are words of limitation. Here, the Government are rightly trying to protect the economy in a broader sense. If the words "involving terrorism" are inserted in the way suggested, on occasions when there could be a detriment to the economy, but not necessarily involving terrorism, the limitation would be regrettable.
Lord Hylton: I should like to follow up the theme opened by the noble Lord, Lord Renton. I asked yesterday, at col. 242 of Hansard, whether Clause 4 dealing with freezing orders was sufficiently widely drawn to catch illegitimate funds—they derive sometimes from the proceeds of crime, corrupt practices and abuse of state power—placed in London by dictators of foreign states, their families and possibly members of their governments. They place those funds in London not for the benefit of their country but of themselves and their families. The Abacha family case from Nigeria is perhaps the most recent and the most notorious. But it is by no means the only one. It is probable that funds belonging to the Milosevic family followed routes through London. Other similar tyrants include the Duvaliers in Haiti, the Marcos in the Philippines, the so-called Emperor
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Bokassa in central Africa, General Mobutu in Zaire and possibly even Mr Saddam Hussein in Iraq. Those people have had a new word coined for them: kleptocrats. It should be possible to freeze such moneys on reasonable suspicion before they move out of London to other financial centres almost at the drop of a hat.
It has already been mentioned that the existing law which sometimes makes it possible to freeze moneys passing through London is the Emergency Laws (Re-enactments and Repeals) Act 1964 which continued emergency powers legislation of 1939. The difficulty is that that legislation has seldom been used effectively.
Clause 4(2) of the Bill states that,
"action to the detriment of the United Kingdom's economy (or part of it) has been or is likely to be taken by a person or persons".
A possible interpretation of those two lines might include harm done to the City of London, our banking and other institutions by their providing a place in which money looted from very poor countries can find a temporary resting place. That may be one way out of the difficulty. Another way might be through the Proceeds of Crime Bill which is still passing through another place. That may not be entirely satisfactory with regard to freezing because it touches only on the recovery of money by means of a civil action in this country.
I should like to see prevented the movement out of Britain, in particular London, or the spending, of funds belonging to very suspect dictators and members of governments. I hope that the Government will be able to give a reply. I have almost six pages of detailed accounts dated 4th October of this year on how various Nigerian moneys moved through London and on to banks in other countries between 1996 and 1999. I have since read in the press that it is thought that £100 million passed through the island of Jersey alone. The sums involved are very large and I imagine that Jersey got only a small fraction.
Lord Renton: Before the noble Lord sits down, will he confirm that those various matters which occurred a year or two ago did not necessarily involve terrorism?
The Earl of Onslow: I disagree with the noble Lord, Lord Hylton. I do not disagree in any way with the ghastliness of the people he mentioned because they are very unpleasant people. However, some of our complaints have been that the Bill has had things attached to it which are extra to the prime purpose of emergency legislation. We might like to hang many things on to the Bill but noble Lords are complaining that there is too much of that already. Therefore, however worthy the point that the noble Lord, Lord Hylton, makes—and it is very worthy—the provision should not be tacked on to the Bill. There is too much of that already, and I hope that we shall take off much of it.
Lord Hylton: First, I agree with the noble Lord, Lord Renton, that the Nigerian money was nothing to do with terrorism.

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On the points raised by the noble Lord, Lord Elton, and the noble Earl, Lord Onslow, yes, I would rather that the Bill were very narrow, dealing with an emergency. However, that is not what we have been presented with and it is not what the Government appear to wish to achieve. If the Bill is to be a wide measure, perhaps it can do some useful work as well.
6.15 p.m.
Lord Elton: Perhaps the Minister will reply to the specific point that what he wants to achieve relates to terrorism. If not, I disagree with the noble Lord, Lord Hylton, and agree with my noble friend Lord Onslow: this is not the vehicle for that provision. There should be a different vehicle.
Lord Thomas of Gresford: I agree with what has been said. The noble Lord, Lord Hylton, rightly raises the serious problem of money laundering through United Kingdom banks amounting to some 630 million dollars. That is a lot of money. In order to deal adequately with that issue, the legislation would have to consider much wider matters than are contained in the clause which deals simply with the Treasury freezing the assets of individuals.
I assume that it is not the Government's intention to legislate generally on money laundering because that is a huge subject which requires a separate Bill. Consequently, I support the submission made by my noble friend.
Lord Kingsland: Amendments Nos. 38 to 40, in the name of my noble friends Lord Dixon-Smith and Lady Buscombe, are in this group. I should like to speak briefly to them.
On Amendment No. 38, we all know that the United States is the prime target of terrorist groups such as A1'Qaeda and is likely to remain so. Countries other than the United Kingdom may be targets or become targets depending on the circumstances. After 11th September we all recognise that the terrorist threat is global and to be effective the response must be global too.
The power to freeze funds where they are likely to be used for terrorism is a useful counter weapon. Why should it be limited to protecting the UK economy and UK nationals and residents? To leave funds here, free for use in terrorism aimed at the United States economy or United States residents, is likely to cause outrage in Washington—and rightly so. Global terrorism needs to be tackled globally. The Government should take the powers necessary to restrain funds that are designed to be used for terrorism outside the United Kingdom.
On Amendment No. 39, we are, in a different way, linking up with the noble Lord. Lord Goodhart. We believe that the power to make a freezing order must be limited. It is not enough simply to show that the action about which a complaint is made will cause some detriment to the United Kingdom economy. We suggest that a freezing order can be made only if the
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action that is going to cause a detriment to the United Kingdom economy is unlawful or has the intention of causing detriment.
There can be no complaints from those affected by a freezing order if their action is unlawful or intended to cause detriment to the UK economy. If, on the other hand, lawful means are used and no detriment is intended, it would not be right for the Treasury to make a freezing order.
Lord McIntosh of Haringey: As we come to Part 2, I should like to stretch the conventions of the House by referring to an article on the front page of today's Evening Standard. It says that Omar Mohammed Othman, otherwise known as Abu Qatada and described as Osama bin Laden's key contact in Britain, today launched a legally aided High Court hid to be paid social security benefits. He has been cited on a United Nations list of suspected terrorists and, although living on benefits in west London, he was found to have assets of £180,000, which were seized. That is the subject of Part 1, which we have just agreed. He is now using legal aid to come back to the High Court to challenge the decision to suspend benefit. It may be helpful to say how Part 2 operates in respect of that application.
Part 2 makes it clear that the Treasury will have the powers to freeze assets in such circumstances. The provisions enable us to freeze funds when there is a threat to United Kingdom economic interests—I shall come to the constraints in a moment—or to the lives or property of United Kingdom citizens or residents. The freezing order can designate persons, groups or governments outside the United Kingdom and anyone, whether in the United Kingdom or abroad, who assists the funding of such people.
As Mr Othman is included in the United Nations list as an accomplice of bin Laden, under the Bill we could freeze his assets on the basis of intelligence, even if there was no investigation in this country. We could stop the payment of benefits because the freezing orders bind the Crown. We could allow some release of funds, including benefits, where appropriate, to avoid undue hardship. That is provided in paragraph 3 of Schedule 3. We could seize—and have seized—the £180,000 cash that police found in Mr Othman's house under the provisions for cash seizure in Part 1, which I have already referred to.
I hope that it will be accepted throughout the House that those are appropriate uses of the powers provided in Parts 1 and 2.
The Earl of Onslow: If the money has been seized already, why do we need new powers to seize it? I ask that purely in the spirit of friendly curiosity.
Lord McIntosh of Haringey: Because Mr Othman is trying to get the money back and we want to make sure that he cannot.
Lord Thomas of Gresford: Do the Government intend to bring before Parliament orders dealing with

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individuals? The machinery is that a statutory instrument should be laid before Parliament. Will that relate to one person?
Lord McIntosh of Haringey: I am coming to that. There is very severe parliamentary control of freezing orders. They are subject to affirmative resolution procedures. That is tough on Parliament, because there could be a number of them.
The amendments relate to Clause 4, which is the central element of the provisions that will allow the United Kingdom to take swift unilateral action to freeze terrorist assets. There will be two conditions. First, the Treasury must reasonably believe that an action threatens the United Kingdom's economy or part of it or the life or property of United Kingdom nationals and residents. Secondly, the action is to be taken by people resident outside the United Kingdom or by a foreign government.
It has been suggested that the concept of threats to the United Kingdom economy is very wide—much wider than terrorism. I am referring particularly to the amendment tabled by the noble Lord, Lord Goodhart. There are unavoidable and desirable constraints on the use of that power. Before we exercise it, we have to consider whether it is compatible with European Community obligations. It could not be used as a means of arbitrary discrimination or as a disguised restriction on the free movement of capital. International law, in particular the World Trade Organisation, would prevent the power being used as an illegitimate tool to protect UK businesses. The European Convention on Human Rights also imposes significant restrictions on the exercise of the power. We can freeze assets only when it is necessary in the general interest and where it is a proportionate interference with the rights of individuals.
The power is just one part of the sanctions regime. If a decision to impose sanctions is taken at European Community level or under a United Nations Security Council resolution, it would not be appropriate to use the power. There are safeguards in the power. As I said, the Treasury must have reasonable grounds for its belief and any freezing order is subject to affirmative resolution in both Houses. A freezing order will automatically cease to have effect two years after it is made and the Treasury has a duty to keep any freezing order under review and to consider whether a change in circumstance means that it is no longer appropriate for the order to continue in force. There are many constraints on what may seem to be a very broad power.
Amendment No. 37 is designed to restrict the power specifically to terrorism. The problem is that the power is intended to provide wide-ranging protection against threats to national security. One reason for these provisions is to counter the new risk of terrorism, but it is also important to cover such situations as wars or civil unrest affecting United Kingdom nationals and their property. The sanctions have been available for many years to counter actions that threaten UK economic interest, wherever that threat comes from.
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I was interested in the comments of the noble Lord, Lord Goodhart, about the restrictions in the 1964 Act. I was not aware of the restriction to gold, but that Act has been used to justify sanctions against the governments and residents of Iraq and Serbia. That was widely thought to be a proper use of it. The amendment would prevent us from doing that in future. The criteria provide a clearer basis for action than simply terrorism, which allows for a more subjective interpretation.
Lord Elton: I do not wish to be a bore on this subject, but I think that I am likely to become so. Can we establish at the beginning that this is emergency legislation directed at an emergency? When the Minister—or my noble friend Lord Renton—starts saying that it would be very useful and desirable to prevent other things happening which are not the product of the emergency, it seems to me that the parliamentary process that we are now using is not appropriate. I am merely picking up on what my noble friend Lord Onslow said a moment ago. The House generally feels that emergency legislation must restrict itself to dealing with the events of the emergency.
Lord McIntosh of Haringey: I did not use the phrase "very useful" but I do not dissent broadly from what the noble Lord, Lord Elton, said. If we included the word "terrorism", we would, in effect, restrict quick and urgent action that was necessary to prevent certain things that cannot be shown at an early stage of an investigation to be terrorism. That will be true for a number of aspects of Parts 2 and 3 of the Bill. We shall resist moves to restrict the powers given under the Bill on, for example, disclosure of information for criminal investigations and proceedings, which is wider than the existing provisions because at the time when it is necessary to allow such disclosure, it will not be possible to know whether such disclosure would be beneficial in dealing with terrorist threats. That is the problem throughout these parts of the Bill.
6.30 p.m.
The Earl of Onslow: The noble Lord has made it worse. He has gone on a trawling expedition and we do not like such expeditions. Everybody accepts—some more readily than others—that there may be a need for emergency legislation, but to make it cover every action in case it leads to terrorism, brothel keeping, or whatever, is too wide. We must restrain the Government's urge to tack things on to Bills just because it would be useful or nice or because it makes our lives easier. We are dealing with terrorism, not brothel keeping.
Lord Renton: Before the noble Lord replies, I hope that it may be helpful if I point out to my noble friend Lord Onslow that not all emergencies involve terrorism.
Lord McIntosh of Haringey: I did not use the words—useful, nice or convenient—that the noble Earl, Lord Onslow, seems to be attributing to me. It

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serves me right for going on to mention Part 3 of the Bill. He is tempted to a view on Part 3 that is completely wrong on the idea that one can trawl for information. However, it would be inappropriate for me to answer that point now, so I shall restrict myself to the amendments that we are discussing.
Amendment No. 37 would restrict the use of Clause 4 in a way that could be damaging to terrorist investigations. Amendments Nos. 38, 39 and 40 go in the other direction. I have already said that the measure will ensure that the powers that were originally intended for use in war time are broad enough to cover the threat of terrorist attacks. To achieve that, we need a broad and flexible power to cover a range of different circumstances. We appreciate that these are serious measures for use only in emergencies and in defence of national security. I am making that point mainly to the noble Lord, Lord Elton, and the noble Earl, Lord Onslow.
We do not think it appropriate, as Amendment No. 38 would provide, to freeze assets unilaterally in response to actions against any state other than the United Kingdom.
Lord Campbell-Savours: I wonder whether my noble friend can help me. On looking through the Bill, I can find no reference to timing. What would happen if the Treasury made a freezing order at the beginning of a parliamentary Recess? What will be the position if the matter has to be approved under affirmative resolution of Parliament?
Lord McIntosh of Haringey: An order of that kind comes into effect immediately on being made and has to be confirmed within 28 days of parliamentary working time. Therefore, it can come into effect even during a Recess, but will fall unless it has been confirmed by affirmative resolution of both Houses within 28 days. It comes into effect immediately, which I think was the point being made.
Lord Campbell-Savours: It would take some time before it secured parliamentary approval. There would be a substantial delay in the Summer Recess, for example.
Lord McIntosh of Haringey: No. It would be in force, which is the important point. I think that everyone agrees that that is necessary.
I return to the point about Amendment No. 38 and states other than the United Kingdom. In those circumstances, we believe that we should implement financial sanctions if they have been agreed, for example, by the United Nations or the European Union, rather than seeking unilateral action. We are looking to limit the scope of the Bill as compared with Amendment No. 38.
Lord Elton: I am most grateful for that emollient phrase. May I ask the noble Lord while he is on
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Amendment No. 38 how the Bill, unamended, will affect the economies of the Channel Islands and the Isle of Man?
Lord McIntosh of Haringey: It depends whether or not they are in the United Kingdom. I do not know the answer, but I shall write to the noble Lord.
Lord Elton: They are not, but they are very much dependent upon us.
Lord McIntosh of Haringey: Then the Bill does not cover them. There may be cases when we wish to freeze funds on behalf of other governments. An Order in Council is currently going through Parliament that will allow the enforcement in the United Kingdom of external forfeiture and restraint orders made in certain designated countries that will include all European Union and G7 states.
I turn to Amendment No. 40, which would change "life" to "persons". We would not wish to exercise those powers in response to less serious actions against United Kingdom nationals, such as petty theft or minor cases of assault. It would be disproportionate to freeze assets against threats to the persons of UK citizens. We believe that the current wording of "life" is appropriate to the gravity of the powers. I emphasise that the use of freezing orders must be consonant with our obligations under ECHR, Community and international law. The qualification that only unlawful or intentional actions against the UK's economic interest is unnecessary. There are extensive provisions to test that there are reasonable grounds for freezing orders through parliamentary scrutiny and appeal to an independent adjudicator through judicial review.
The clause has been approached from both sides. I adhere to the view that the balance that we have struck in the wording is the correct one.
Viscount Goschen: Before the noble Lord. Lord Goodhart, speaks again to his amendment, I should like to ask the Minister a question. He objected to the use of the term "involving terrorism". I agree with my noble friend Lord Onslow and the noble Lord, Lord Goodhart, that the Bill should be restricted to terrorism. I see no reference to national security. Clause 4(2)(b) refers to,
"action constituting a threat to the life or property of one or more nationals",
which is a very broad description and could relate to almost any crime.
Does the noble Lord object to tightening up that subsection with reference being made to national security, including terrorism, or does he feel that the drafting is perfect?
Lord McIntosh of Haringey: The drafting is more helpful than referring simply to national security. We have spelt out what national security means, which is helpful.
While I am on my feet, I shall deal with two points that were raised in the debate and which I have not yet answered. The first referred to the Channel Islands and

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the Isle of Man. They are not covered in the Bill, but we are asking their governments to make their own legislation.
The noble Lord, Lord Hylton, asked about dictators. We all sympathise with the emotion behind his remarks, but the Bill is not for dealing with stolen assets or corruption funds; it is about national security. The correct vehicle for what the noble Lord, Lord Hylton, referred to is the Proceeds of Crime Bill, which includes provisions to freeze funds at the start of a police investigation. I hope that when we come to that Bill, he will raise those points in the House.
Lord Thomas of Gresford: I was pleased to hear the Minister refer to judicial review. I sought confirmation in the debate yesterday but the Attorney-General did not have time to reply to me at that time.
I should like to make another point. The Minister described a virtual Grand National course of obligations that have to be surmounted, together with the parliamentary procedures, before a freezing order is ever made. Would it not assist in lowering the fences if it were quite clear from the wording of the Bill that it related to terrorism, as my noble friend suggested in his amendment?
Lord McIntosh of Haringey: No. At the time when action had to be taken, it would not necessarily be possible to prove that terrorism was involved. That is why we seek these broader powers and constrain them in a way that I hope meets with the approval of the noble Lord, Lord Thomas.
Lord Goodhart: The debate has gone on longer and ranged a good deal wider than I anticipated when I moved this amendment. For example, the noble Lord, Lord Hylton, raised the question of the possible use of the clause to restrain or freeze the assets of dictators. I agree with what the Minister said in that regard.
I end by not being satisfied with the Government's response. As regards the drafting, the Minister did not attempt to dispute my interpretation; that is, that it is within the wording of the Bill as it now stands that it should cover the competitive bidding for overseas investment that I was describing. I specifically chose the example of Switzerland because I wished to choose a state which was not part of the European Union.
It is certainly unsatisfactory if we have to rely for the restriction on the extreme width of Clause 4 on international obligations, the rules of the World Trade Organisation and so forth. It would be better if on the face of the Bill some limitation could be imposed on the width of Clause 4. I entirely accept that Clause 4 is not intended to be limited to terrorism and that my amendment is therefore inappropriate. But that gives rise to the wider problem raised by the noble Lord, Lord Elton, and the noble Earl, Lord Onslow, and it again discloses a problem dealt with by many speakers yesterday, including myself. This is a wholly inappropriate use of emergency legislation because it goes well beyond the emergency.
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Having said that, I cannot redraft the legislation for the Government. It is unsatisfactory. Nevertheless, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 38 to 40 not moved.]
Clause 4 agreed to.
Clause 5 [Contents of Order]:
[Amendment No. 41 not moved.]
Clause 5 agreed to.
Clause 6 agreed to.
6.45 p.m.
Schedule 3 [Freezing orders]:
Lord Kingsland Lord Kingsland moved Amendment No. 42:
Page 97, line 37, after "is" insert "reasonably"
The noble Lord said: Amendment No. 42 provides that disclosure to the Treasury under that part of the Bill should take place,
"as soon as is reasonably practicable".
As currently drafted, the Bill states that a freezing order can require disclosure to the Treasury of relevant information as soon as is practicable after the information is received. However, there may be situations in which a person cannot make the disclosure, for good reason, as soon as would otherwise have been practical. To reflect those situations we suggest that provision is made for such disclosure to be made,
"as soon as is reasonably practicable".
A similar sentiment lies behind Amendments Nos. 46 and 47, the first in relation to Clause 11(1)(c) and the second in relation to Clause 11(2)(c). I beg to move.
Lord Monson: Perhaps I may point out that there is a drafting defect in both Amendments Nos. 46 and 47, no doubt understandably in view of the haste with which the amendments had to be tabled. The definite article has been omitted in front of the word "Treasury" and it does not read quite right without the word "the" in front of it.
Lord McIntosh of Haringey: It may be helpful if I say that we understand that these amendments are intended to make it explicit on the face of the Bill that any amendment to a freezing order as well as the making of the order is based on the Treasury's reasonable belief that the relevant conditions are met. We agree with that principle.
Our view is that that is the effect of the current drafting reads in accordance with the Interpretation Act 1978. However, we agree that the Bill should expressly provide that in making changes to freezing orders the Treasury must have a belief, as well as stating that it has a belief, that the relevant conditions are met, and that that belief should be reasonable. We shall table amendments on Report to meet that point.
Lord Kingsland: I am grateful to the Minister for that undertaking. In those circumstances it is proper for me to beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Schedule 3 agreed to.
Clause 7 [Review of order]:
Lord Kingsland Lord Kingsland moved Amendment No. 43:
Page 4, line 5, at end insert "and must revoke such freezing order if it ceases to have reasonable grounds to consider that the conditions set out in section 4 are fulfilled"
The noble Lord said: In moving Amendment No. 43 I shall speak also to Amendments Nos. 44 and 45.
However necessary may be the powers to freeze funds on the say-so of the Government, those powers are draconian and require protection against executive abuse. Just as a power must be exercised only if certain conditions, as set out in Clause 4(2), are fulfilled, so the order should be revoked as soon as the conditions cease to be fulfilled.
There appears to be no protection in the Bill as drafted against the Treasury letting a freezing order run for the full two years, even if the reasons for it have fallen away. Amendment No. 43 requires the Treasury to lift the order when the conditions are no longer fulfilled. So the "victim" of the order if—I may use that expression—has some legal recourse if the Treasury fails to so act.
I turn to Amendment No. 44. There appears to be no provision in the Bill as drafted to allow for the renewal of a freezing order at the end of the initial period of two years. That might have the bizarre effect that the Treasury was forced, as a pure matter of timing, to release funds when it had reasonable grounds to suppose the funds would immediately be used to launch a terrorist attack. It is even more bizarre to allow detention indefinitely, without trial, but impose a time limit in the much less important context of money.
Although we would not normally argue for a swingeing measure, such as a freezing order, to be strengthened, we are prepared to accept that, in the context of terrorism and London's pivotal position as a financial centre, there may be a strong case for renewal in some circumstances—provided there is the possibility of recourse to the courts as proposed in our amendment to line 5. Amendment No. 44 is designed to achieve that.
Finally, I turn to Amendment No. 45. A freezing order prohibits all those in the United Kingdom, and United Kingdom nationals elsewhere, from making funds available to or for the benefit of specific persons named or described in the freezing order. If such a person acts in breach of a freezing order he can be sent to prison for two years.
At the very least, there should be some convenient means by which the existence of the freezing order is brought to the attention of the criminal party. It is hardly fair that the Treasury can make a freezing order, which carries with it criminal sanctions, and not publish it in some way so that innocent people do not inadvertently become criminal.
Such publication can be achieved relatively easily by simply inserting the appropriate notice in the Gazette. It is our understanding, or at least our hope, that many banks regularly read the Gazette to check winding up petitions which have the effect of freezing a company's assets. That is, or should be, an established practice in the banking community. If the list of freezing orders are then published, either before or after the list of outstanding petitions, those responsible for checking such a list will be able to look at the list of freezing orders as well.
This is an important point because the whole purpose of a freezing order is to freeze money and not to catch innocent people unawares and send them to prison. The aim is to freeze the cash and that is achieved if the freezing orders are brought to the attention of those who hold the cash. I beg to move.
Lord Renton: I believe that the Government would welcome the amendments to which my noble friend has just spoken. Clause 7 as it stands is unusual. It merely says,
"The Treasury must keep a freezing order under review".
But these amendments would enable the Government, when reviewing a freezing order, to take various forms of action which could well be necessary in the circumstances. I would hope therefore that the Government will say, "Yes, this will enable us to fulfil our intentions much better". In other words, these amendments are not only in the Government's interest but also in the national interest.
Lord McIntosh of Haringey: I would have thought that the noble Lord, Lord Renton, would approve of the taciturnity and precision of Clauses 7 and 8. The noble Lord, Lord Kingsland, might have called there "telegraphic". I believe that they are absolutely clear and admirably short.
Before I deal with them perhaps I may say something about my response to Amendments Nos. 46 and 47. I said that we would introduce amendments at Report stage to cover these points. I did mean Amendments Nos. 46 and 47 rather than Amendment No. 42, which is a separate issue.
Clauses 7 and 8 represent wonderful drafting. They underline the emergency nature of the provisions. They provide for an ongoing review of all freezing orders. They set a maximum period of two years after which freezing orders will cease to come into effect. As regards Amendment No. 43, we do not need to specify in that context that the Treasury must revoke an order when the condition under which it was made is no longer fulfilled. That is clearly the intention underlying Clause 7. As part of our obligation to review we pay careful attention to any change in circumstances There is no point in having a review unless one is prepared to revoke.
However, an explicit provision could impair the effectiveness of the power if the circumstances which led to an order changed but it was still appropriate to have an order in place. As regards Amendment No. 44, I do not see any benefit in it. If the order needs to be

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continued it should be made again subject to affirmative resolution in Parliament. That is for the protection of Parliament. The Treasury would make it clear in such debates that it was replacing an order that had expired. These are serious powers and they should be subject to parliamentary scrutiny.
As regards Amendment No. 45, we are dealing with statutory instruments. They are public documents made freely available as soon as they are laid, including on the HMSO website. As the targets will be primarily abroad, publication in the Gazette would be unlikely to bring the order to their attention. As a matter of practice the Bank of England does publicise these orders among financial institutions.
As regards banks being liable to criminal penalties, paragraph 7(5) of Schedule 3 provides a defence for those who do not know that the person to whom they have made funds available was the person specified in the order.
Viscount Goschen: Before my noble friend responds to the Minister's comments, can the Minister explain what he understands to be the use of Clause 7 as it stands in the Bill? It states that the Treasury must keep an order under review. What does that mean? It is not specified unless that appears somewhere else in the Bill and I do not know about it. Exactly what review process has to be gone through? Would it be open to challenge? Just to state that the order must be kept under review reflects the kind of wording that Government Ministers use from time to time about policies on which they have yet to make decisions. The current wording is meaningless on its own.
Lord McIntosh of Haringey: The noble Viscount, Lord Goschen, does not like plain English either. The clause means what it says. The matter has to be kept under review. If there are changed circumstances which mean that the order should be revoked, that will be done. What the Treasury cannot do, according to Clause 7, is simply to make an order and forget it. This clause is entirely desirable as well as being clear.
Lord Kingsland: I thank the Minister for his reply. As regards Amendment No. 43, the noble Lord said that an explicit provision of the sort contained in that amendment would impair the effectiveness of the power. I find it hard to see how that can be so. If the noble Lord has no other complaint than that against the amendment, then surely including it on the face of the Bill would be wholly advantageous.
Lord McIntosh of Haringey: There could be a wide range of conditions set out in Section 4. It could be that some of them have changed as the amendment provides and the order must be revoked. Surely that cannot be right. One must admit the possibility that under changed conditions, which have been identified in the review, it would not be appropriate for the order to be revoked.
Lord Kingsland: I am most grateful to the Minister for that further clarification. But the amendment says,
"if it ceases to have reasonable grounds to consider the conditions set out in section 4 are fulfilled".
If the Treasury ceases to have reasonable grounds, in those circumstances, it is hard to imagine any conclusion that the Treasury could reach other than revocation. Perhaps the noble Lord would like to reflect further on this clause before he returns to your Lordships' House at Report stage.
Lord McIntosh of Haringey: I am glad to do that. I always reflect on these matters.
Lord Kingsland: I am most grateful to the Minister. I am also grateful to the noble Lord for his response to Amendment No. 45. I am not quite sure what conclusions I should draw from what the Minister said. Is he accepting my amendment by saying that it is unnecessary or is he accepting it by saying that he is going to add it to the Bill? This is the amendment regarding the Gazette.
Lord McIntosh of Haringey: No, certainly not. It would be inappropriate use of the Gazette. The statutory instruments are published and the Bank of England provides all banks with a summary. It is quite unnecessary and an inappropriate use of the Gazette.
Lord Kingsland: I thank the noble Lord for that clarification. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 7 agreed to.
Clause 8 [Duration of Order]:
[Amendment No. 44 not moved.]
Clause 8 agreed to.
[Amendment No. 45 not moved.]
Clauses 9 and 10 agreed to.
Clause 11 [Procedure for making certain amending orders]:
[Amendments Nos. 46 and 47 not moved.]
Clause 11 agreed to.
Clause 12 agreed to.
Clause 13 [De-hybridisation]:
On Question, Whether Clause 13 shall stand part of the Bill?
7 p.m.
Lord Phillips of Sudbury: This is an error. The Question should be whether Clause 17 stand part of the Bill. Clause 13 concerns de-hybridisation. I have raised the matter with the learned Clerk and, with the leave of the Committee, the Question whether Clause 17 stand part of the Bill should be dealt with in the right place, which is at the end of the amendments to Clause 17.
Clause 13 agreed to.
Clauses 14 to 16 agreed to.
Clause 17 [Extension of existing disclosure powers]:
Lord Goodhart Lord Goodhart moved Amendment No. 48:
Page 7, line 6, at beginning insert "Subject to subsection (2A),"
The noble Lord said: In moving Amendment No. 48, I wish to speak also to Amendments Nos. 59, 70 and 81. These all raise the issue of the privilege against self-incrimination. Part 3 deals with the disclosure of information. Clause 17 extends many existing powers of disclosure to cover disclosure for the purposes of criminal investigations or criminal proceedings. Clause 19 concerns disclosure of information held by the Inland Revenue or Customs and Excise.
I shall confine my remarks to Clause 17 but they apply also to Clause 19. Clause 17 applies to the provisions in Schedule 4, which contains a list of 53 statutes and a number of Northern Ireland orders, under which information is required by government departments or public authorities. That information is now to be used not only for the purposes for which it was originally required under the 53 statutes but also for the purposes of criminal investigations and criminal proceedings.
A large number of those statutes—I have not attempted to go through all of them, but those I have looked at make the position quite clear—require people in the private sector, individuals or companies, to provide, under statutory direction, information on certain subjects. If that information is to be used for the purposes of criminal proceedings against the persons who provided that information, the question arises whether that is a breach of the privilege against self-incrimination which has been held to be part of Article 6 of the European Convention on Human Rights.
I admit that to some extent the law on that point is in a somewhat uncertain state. Some years ago we had the decision of the European Court of Human Rights in the case of Ernest Saunders. Mr Saunders had in the course of the investigation of the Guinness share pushing deal been required to give evidence to inspectors under the companies legislation. It was a statutory requirement that he should give that evidence. The evidence that he gave was then used against him in the criminal trial. Subsequently, it was held by the European Court of Human Rights that there was a breach of his rights under Article 6.
In the other direction we have the decision of the Privy Council in the case in Scotland, the name of which. I believe, was Brown, in which a woman was required to state whether or not she was driving a car at a particular time as that information was relevant to criminal proceedings against her. It was held that the request to give that information was not a breach of her rights under Article 6. Therefore, it is not clear what the position is. I raise the provision largely as a probing amendment to find out whether the Government recognise that some of these obligations under Clause 17, and perhaps also under Clause 19, may breach the privilege against self-incrimination. If that is the case, how do the Government propose to deal with that, or do they simply intend to leave the matter at large and
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allow the courts, when looking at any particular case, to decide whether there is a breach of the privilege against self-incrimination? I beg to move.
Lord McIntosh of Haringey: Strictly speaking. I ought to confine myself to the amendments which concern the use to which information can be put by prosecutors, which is not the subject of this part of the Bill at all. This part of the Bill deals only with disclosure. However, the noble Lord, Lord Goodhart, made a perfectly legitimate point to which one ought to respond. Before I discuss the issue of self-incrimination, I should say that the extension here does not concern criminal proceedings. Disclosure provisions already exist in regard to criminal proceedings. The extension here concerns criminal investigations. Therefore, it is less of an extension than the noble Lord indicated.
Let me make it clear that we are not changing the ways in which information can be used; we are simply widening the gateways from prosecutions to investigations. The specific answer to the noble Lord's question is that some of the Acts listed in Schedule 4 already contain provisions that prevent information obtained through compulsory powers being used as evidence against the person who provided it. Those restrictions on use will continue to hold good for information disclosable under Part 3. The noble Lord mentioned the Saunders case. Some of the provisions for information disclosable under statutory powers came into conflict with that case and some of the Acts referred to in Schedule 4 have been amended accordingly. As I say, those restrictions on use will continue to hold good for information disclosable under Part 3.
In addition to the restrictions on use that may already be contained in the enactments listed in Schedule 4, which will still apply, any public authority prosecuting a criminal offence and any court considering the matter would have to consider the Human Rights Act and the Saunders and Brown cases to which the noble Lord, Lord Goodhart, referred.
Baroness Carnegy of Lour: Is the Minister able to say whether the Government accept the recommendation of the secondary legislation committee that the order referred to in subsection (3) of Clause 17 should be subject to affirmative procedure, or has that not yet been decided?
Lord McIntosh of Haringey: That point will be dealt with in consideration of a later amendment. In order to curtail debate, I shall say in advance that we shall accept the recommendation of the Delegated Powers and Regulatory Reform Committee.
Lord Goodhart: I am grateful to the Minister. It is clear that the Government have given some consideration to the possible self-incrimination aspects. In the circumstances, I believe that broadly my inquiries have been answered satisfactorily. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Phillips of Sudbury Lord Phillips of Sudbury moved Amendment No. 48A:
Page 7, line 7, after "authority" insert "to another public authority".
The noble Lord said: This, too, is a probing amendment. I hope that it will be of use to the Committee in consideration of this complex Bill. Late last night, when grappling with the wording of Clause 17(2), it seemed to me that the scope of disclosure permitted by that clause may be wider than most of us understand or, indeed, than the Government intend. It is wide enough in authorising disclosure by or on behalf of a public authority, given of course that "public authority" is defined by reference to the Human Rights Act.
Therefore, public authorities do not include only governmental departments, governmental bodies and statutory bodies but what are known as "hybrid" public bodies. That term extends to organisations such as the Law Society, the Bar Council, the General Medical Council, a doctor or healthcare worker working within the NHS, a privatised company running a school or a prison, Railtrack and the Press Complaints Commission. It is a massive extension of disclosure prospects.
The point of the amendment is to confine the right to disclose to all the bodies concerned in accordance with the 66 scheduled pieces of legislation, to other public bodies or, as I have expressed it, to another public authority. As the clause stands, I cannot see any reason for wondering whether or not the disclosure is also to be allowed to an individual who comes within paragraphs (a), (b), (c) or (d) of Clause 17(2); that is, an individual bringing a private prosecution, contemplating bringing a private prosecution or contemplating investigating a private prosecution, as covered in paragraph (d).
There, of course, we enter a very deep and broad sea. One is dealing with the prospect of an individual bringing criminal libel proceedings, which very often are highly personal and acrimonious. One thinks of cases such as that of the late lamented Jimmy Goldsmith against Private Eye. One thinks also of criminal damage prosecutions, of rape or attempted rape prosecutions, of theft or attempted theft prosecutions, perjury prosecutions and a host of others.
It will be no answer to the huge range of private activities that fall within paragraphs (a), (b), (c) or (d) to say that some of them require the fiat of the Attorney-General before the prosecution can take place. Of course, paragraphs (a), (c) and (d) of subsection (2) extend to activities prior to the commencement of the prosecution. Only the commencement of the prosecution requires the consent of the Attorney-General in a few cases.
Therefore, as I said, the amendment is designed to prevent the clause extending to that whole range of cases. It would also prevent an unfairness in that, if, indeed, private prosecutions were within the scope of this clause, there would be a serious inequality of arms because the defendant in those private prosecutions
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would not have the same rights of access to disclosed information as the prosecuting individual. On those grounds, I beg to move.
7.15 p.m.
Lord McIntosh of Haringey: I can reassure the noble Lord, Lord Phillips, to some extent, but I do not believe that I shall be able to do so completely. The extent to which I can reassure him is that, as the Bill is drafted, a defendant in a private or public prosecution is included as a person to whom information can be disclosed. But he would not be included if the amendment were carried. Therefore, the amendment would work in the opposite direction to the sense in which the noble Lord, Lord Phillips, wants it to work.
The provisions permit disclosure only for purposes connected with criminal proceedings or criminal investigations. That is a very great restriction on the wide range of examples that the noble Lord, Lord Phillips, gave in introducing the amendment. However, it is true that private prosecutions would be included, as would, for example, the private prosecution of those accused of the murder of Stephen Lawrence. Is that so terrible? I am not sure that I agree that it is.
The Earl of Onslow: In the context of this Bill, yes, it is terrible. We are dealing with terrorism, terrorism and terrorism. We are not dealing with the murder of Stephen Lawrence; we are not dealing with brothel keeping; and we are not dealing with parking on a double yellow line. We want to confine the Bill to what the Government say it is about. Many of us have made that complaint. Yesterday, I and many other noble Lords around the House made that very complaint. We must confine the Government. No one is saying that they should not have these powers if they want them; but they must get them by proper legislation and proper means. That is the complaint that runs through the whole core of this argument.
Lord McIntosh of Haringey: I appreciate the force with which the noble Earl, Lord Onslow, makes his point, and I appreciate that it was made by a number of other people. From that point of view, perhaps my example was unfortunate, just as the examples given by the noble Lord, Lord Phillips, of criminal libel and criminal damage could be considered to be unfortunate in the other direction. Therefore, the extent to which I cannot satisfy the noble Lord, Lord Phillips, is by saying that we acknowledge that the Bill permits disclosure to those involved, whether or not they are public authorities, in criminal investigations and proceedings.
As the noble Earl, Lord Onslow, has widened the discussion, perhaps this is an appropriate moment for me to say something about Clause 17 as a whole. I believe that it is enormously important.
Lord Phillips of Sudbury: I thank the Minister for giving way. Would it be better if I responded to my amendment before he launched into a general statement? It is entirely up to the Minister.
Lord McIntosh of Haringey: It is up to the Committee. But I have something to say about Clause 17 which affects all the amendments to that clause. If it were for the convenience of the Committee, I should like to find an opportunity to say it. However, I am in the hands of the Committee.
Lord Phillips of Sudbury: I believe that that is enormously helpful. However, it may finalise the discussion on this amendment if I were to respond to what the Minister said and then leave him free to make his general remarks.
Lord McIntosh of Haringey: I shall not make general remarks except on an amendment. Shall I simply do it?
Lord Phillips of Sudbury: Yes.
Lord McIntosh of Haringey: There has been much misrepresentation in relation to Clause 17. Therefore, I want to say that these gateways—the provisions for information disclosure—in Schedule 4 all exist. They have all been approved by Parliament. There are no new gateways. They refer to information of specific types which are covered by existing statutory restrictions on disclosure, and they are restricted to information collected under statutory powers.
The duties under the Human Rights Act and the Data Protection Act still apply to all disclosures. Disclosures must be proportionate, necessary and lawful. Only public officials will be able to disclose, and only in their capacity as public officials. That means that something arising in the pub will not count. I have read that the provision will allow access to information from doctors or bank managers, but they are not public officials, and health records and bank records are not covered by the provisions. We are simply widening each of the gateways to ensure that disclosure is permitted if all other safeguards are satisfied for criminal proceedings, as now, to investigations and to determine whether an investigation should begin.
There is no question of public officials being obliged to make disclosures. It is up to them to decide whether to do so. There is certainly no question of the police or anyone else trawling records. There will be no investigatory access to the records covered by the Acts in Schedule 4. Public officials will have to determine on a case-by-case basis whether they may disclose the information.
Those are huge changes since the Criminal Justice and Police Bill was before Parliament before the election. I hope that our discussion of Clause 17 will be informed by my comments.
Lord Phillips of Sudbury: That is a most irregular response to a specific amendment. Many people will be astonished to know that Clause 17 covers not only individuals bringing private prosecutions—I enumerated some of them—but also that disclosure vis-à-vis private and public prosecutions will extend to the accused. That goes far beyond the expectations that any of us had.
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I turn to what Jack Straw said on the matter in the other place during the passage of the Criminal Justice and Police Bill in January this year. He described the provisions as allowing a,
"reciprocal flow of information between those bodies, the police and the National Criminal Intelligence Service".—[Official Report, Commons, 29/1/01; col. 41.]
Gordon Brown commented in the other place on the provisions as recently as 15th October, which was, of course, before the Bill's publication. He said that the provisions would allow official bodies, particularly the Inland Revenue, to exchange information with other bodies in fighting the financing of terrorism.
There has been a unanimous response to the measure, from Liberty, Justice, the Law Society, the Bar Council, Uncle Torn Cobbleigh and all. The provision is drafted in the widest possible terms as regards the categories, particularly category (d). We shall later come to an amendment dealing with that. We have now heard not only that public authorities include hybrid bodies that are not public at all in the common sense of the word but that they will allow any person bringing any private prosecution to have access to disclosure under Clause 17, and any person accused by a private citizen bringing a private prosecution or by any state, body, police or prosecuting authority.
Lord McIntosh of Haringey: I do not claim that the noble Lord and I are of one mind on this matter. There is a difference between us, and I do not want to restrain him from taking any action that he thinks it necessary to take. However, there are important limits—they will limit the circumstances in which information can be disclosed to a person who is not a public authority.
The Human Rights Act will apply to every disclosure that takes place under the provisions. In particular, disclosure will he possible only when it is compatible with Article 8—the right to privacy. Obviously, that limits the circumstances in which the public authority itself can disclose information. However, there are circumstances in which a public authority will be subject to a duty to ensure that it does not breach Article 8 and that it does not enable anyone else to do so. In other words, when a public authority is considering whether or not to disclose, it will have to consider what the person to whom he proposes to disclose the information will do with it. In some cases, it will be appropriate for the public authority to disclose, subject to certain conditions, which would prevent onward disclosure. I hope that that helps the noble Lord, at least in part.
Lord Phillips of Sudbury: I am grateful to the Minister—he made that point in an earlier speech. It is of little consolation, but we shall discuss that in relation to later amendments. However, I shall not prolong the discussion of this amendment. I shall, if I may, raise the issues later. I suggest to the Minister that he reviews what he said in the light of the amendment and takes counsel about whether the Government

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really intend the gateway to be not a gateway but a huge hole in relation to the confidentiality of information. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord McIntosh of Haringey: I beg to move that the House do now resume. In moving that Motion, I suggest that the Committee should meet again not before 8.25 p.m.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Teachers' Contracts
7.26 p.m.
Baroness Sharp of Guildford Baroness Sharp of Guildford rose to ask Her Majesty's Government whether they support the increasing use of short-and medium-term contracts in the further and higher education sector.
The noble Baroness said: My Lords, I begin by declaring an interest. For the years 1981–99, I was employed as a contract researcher at the University of Sussex. Part of the case that I want to make rests on my experience as a contract researcher. I moved to the University of Sussex in 1981 from what was effectively a Civil Service job, working for the National Economic Development Office. In 1982, I was selected as the SDP candidate for Guildford. As a result of that selection, I in effect had to return my return ticket to NEDO. Although I had been seconded from NEDO to the University of Sussex, I had to give up my right to return there and I became willy-nilly a contract researcher. I was lucky because I had a husband who was in full-time employment as a civil servant. My salary was therefore supplemental to his. The flexibility that being a contract researcher gave me was very helpful in my pursuit of a political career.
Initially, I was on a three-year contract, which meant that I did not have to sacrifice pension rights. Had I been on a contract of less than one year, I would not have had my pension rights continued. Subsequently, I found that I had little difficulty in putting in applications and research proposals or in getting them funded, and I was therefore funding my own salary—I did that from then onwards. I gradually moved up within the unit in which I was working. I moved from being a senior researcher to leading a research group, and subsequently led an ESRC research centre. In the process and through the research group, I brought about £7.5 million into the university.
I was lucky, but others in my unit were not. Many of them had had as many as 25 contracts during a working period of 20 or 25 years. Those who were on contracts of less than one year often had periods in which their pension was not paid. There was also constant uncertainty about where next year's income
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would come from. Again, so far as I was concerned, that did not matter too much—my husband was pulling in a perfectly good salary. If I found myself without a job, that would give me a little bit of unexpected leisure. However, for people in their late 30s or early 40s with a family and young children to look after and a mortgage to pay, that was a very difficult situation.
One matter that rankled with me was that I found that I was disenfranchised—I had no right to vote for the senate or to sit on it. In some senses I did not mind about that. When I was a full-time academic at LSE, I found that sitting on the senate was not necessarily a pleasurable experience. Nevertheless, the fact that I was disenfranchised in that way meant that I was a second-class citizen. When the Vice Chancellor's wife convened a dinner party for senior women academics at the university I was not there because I was not a tenured member of staff. I was a second-class citizen. Contract researchers are or have been within the university hierarchy second-class citizens.
Interestingly, the research that I was doing at the time led me to learn rather more about contract researchers. I was following the biotechnology directorate in the Science and Engineering Research Council and evaluating a number of their programmes. That led me to have a better understanding of the concept of the post-doc researcher in the British scientific world. The post-doc is the equivalent of the junior hospital doctor in medical training. When you have done your doctorate and are qualified, you go on to do an apprenticeship of two to three years, after which you are in a position to hold a fully tenured post. The traditional position for post-docs was that after two or three years they obtained substantive posts as lecturers. Those that did not were quietly pushed to one side to work in government laboratories or industry and quietly made to recognise that they did not have a future in the universities.
However, by the 1980s that traditional pattern of apprenticeship had changed. First, the substantial expansion of university research and a contraction in the number of government laboratories and industrial research associations meant that there were many more jobs in universities and rather fewer jobs elsewhere. Secondly, the squeeze on university funding meant a freeze on recruitment. No new lectureships were created. By the mid-1980s, typically, instead of waiting just two to three years for a lecture post young researchers were having to wait five to six years or sometimes even longer.
Meanwhile, because of funding uncertainties universities preferred to take on short-term rather than long-term staff. The anomaly emerged. Numbers employed at universities remained the same but the balance began to change with a larger proportion being employed on short-term contracts. That even extended to lecturer posts. Most first appointments from then on were made as temporary lecturer posts. Those young people, mostly in their 30s, faced all the

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uncertainties faced by my colleagues; that is, problems of getting mortgages and an uncertainty as to where their income was coming from.
In addition, one matter which I found interesting in my research was that most universities imposed a six-year limit on the length of contract of employment. If contract researchers stayed over six years, universities would be liable to pay redundancy pay. I discovered a merry-go-round under which contract researchers were shuffled around from one university to another. They had limited pension rights—contracts of less than one year carried no pension rights—limited employment rights; no rights to sabbatical leave and no career development path. To boot, they were treated within the university world often as second-class citizens. It was no wonder that I found among them a disgruntled group of citizens who often had little time for their universities or their career.
Now, thanks partly to a report from your Lordships' House in 1995 on academic research careers, things have changed. That report highlighted the problems of contract researchers. The CVCP as it then was, now Universities UK, introduced a concordat which promised to create a proper system of research and guidance in research careers. That was followed up by the research careers initiative, which proceeds to this day. The same problems were also highlighted in the Dearing report—I see the noble Lord, Lord Dearing, in his place—and subsequently in the Bett report, which highlighted in particular the degree to which inequalities made their mark on both women and ethnic minorities.
Today we have a new directive from the European Union on fixed-term work, which promises—if we make the best of it—to end the scandal completely. But how much have things changed? A recent labour force survey shows that of the 400,000 employees in higher education, 98,000 are employed on a temporary basis with 84,000 of those on short-term contracts. There are 39,000 research staff. Ninety-four per cent of research staff employed in British universities are all on Fixed-term contracts. The proportion of academic staff on fixed-term contracts increased over the past five years between 1995 and 2000 from 39 per cent to 42 per cent.
I believe that universities have been trying to improve practice, but that is extremely difficult. There are increasing pressures to increase research incomes, but by its nature research income is uncertain. Fixed-term contracts tied to the length of the research contract are well suited to be able to tailor the needs of the research labour to the length of the contract. Other income is extremely tight. There is no capacity to cross-subsidise from the teaching budgets to the research budgets within universities. Increasing pressures on universities from the quality assurance assessment and research assessment exercise have consumed top management time and given little chance for development of long-term policies for human resource management, least of all for those at the bottom of the academic pecking order.
Therefore, I call on the Government to recognise that the problem of contract research remains a real problem in British universities and also in the further education sector. I have not had time to talk about that sector, but many of the same problems apply. I ask the Government to recognise that this remains an important issue. They should encourage publicly-funded institutions such as universities and further education colleges to improve their employment practices. They should not make matters worse by multiplying further the number of initiatives and challenge funds they sponsor. More core funding is wanted in universities, not more initiatives which require more proposals and encourage short-term and uncertain funding.
1 call on the Government to accept that the cost of making good the inequalities revealed by Bett and other reports is substantial, and to fund universities and colleges sufficiently to enable them to right that discrimination. Finally, I call on them not to duck out of the EU directive on fixed-term work which, if implemented, would go a long way to meet the current criticisms of the system. There are dangers that the Government will seek to duck out.
Finally, I call on universities and colleges to consider initiatives which, without cost, could improve the position of contract researchers. Are they still practising the implicit discrimination that I experienced in my time by not giving, for example, a voice to contract researchers or a chance to vote on senate? There are many small matters which, in this way, could help to restore morale and goodwill. If we believe that the collegiate principles of such institutions are important, the concept of membership and equality of membership is also important.
7.38 p.m.
Lord Maginnis of Drumglass: My Lords, it is more than a mere courtesy or formality that causes me to begin my first short contribution in your Lordships' House by thanking your Lordships and the staff of the House for the considerations and kindness I have been accorded in my short time here. I am genuinely grateful.
After 18 years in another place, preceded by 23 years as a village schoolmaster, I have quickly learnt that your Lordships' House, whatever it may appear to others, should not be regarded as some sort of ante-chamber just outside the gates of Heaven. That said, I recall how, after my 1997 re-election to another place, I found myself getting into a lift with a young lady who was obviously unfamiliar with her surroundings. Wishing only to be of assistance I enquired whether she enjoyed it here and for whom she worked. "I don't work for anyone", she replied, with perhaps not altogether feigned displeasure, "I am a Member of Parliament". I promise that I do not have any similar misapprehension about my place in your Lordships House. I am privileged to be here and I am anxious to learn how I may best contribute to the work of the House.

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I have been well cautioned that my first contribution should not be controversial. What I cannot quite work out is why those who so advised me were predominantly former Secretaries of State and Ministers of State for Northern Ireland. Perhaps I made an impression on them. Yet, for me, education is an emotive subject at every level. Perhaps in that it is no different from any other aspect of politics, be it health, the environment or democracy.
In terms of democracy, my own political life in Northern Ireland terms has been dominated by a continuous striving for something better. Education and opportunity for our young people are an essential aspect of that ambition. However well we do in educational provision, we can never do well enough.
When I read the Dearing report I found it, if not somewhat confusing, frustrating and not altogether encouraging. It suggested that a greater reliance on short-term contracts could have a detrimental effect on the quality of achievement within higher education institutions, stating:
"Loss of expertise as staff on short-term contracts look for stable employment may lead to inefficiencies in research, and impair the quality of teaching. Career planning is difficult and the uncertainty may act as a disincentive for people to enter the profession, or remain in it, in the absence of more senior level posts".
However, Dearing later appears to recognise a different reality when he states:
"Short-term contracts can be beneficial for both sides, if managed carefully. They provide the flexibility needed for projects whose funding cannot be guaranteed long term, thus enabling institutions to avoid making commitments they cannot fulfil".
A 1999 report published by the National Association of Teachers in Further and Higher Education entitled Casualisation & Quality—a study of the issues for quality and research raised by the employment of part-time and fixed-term staff in higher education, concluded:
"The overall picture that emerges from this initial research is inconclusive, but does give ground for concern. There is plainly a mixed picture".
At whatever level we consider the teaching profession, we cannot believe that we will achieve greater productivity and more commitment if there is a significant element of that profession unsure of its long-term future. Uncertainty does not engender happiness and unhappiness can only diminish the profession.
Obviously, there is some need for further and higher education institutions to have a degree of contractual flexibility but that must not be at a level that leads to instability. The questions to be decided must be: what is a sustainable baseline? Can it be defined on a national basis or does it vary from institution to institution? Can government do more to encourage greater levels of research funding than are at present achieved, through even closer links with industry? That may be the way forward.
In conclusion, reality is that higher and further education will always have to compete with industry and the private sector for the best brains. It will not do
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so successfully unless it either competes on a level playing field—financially the field is not level—or finds more ways of co-operating with the private sector, having defined common purpose and mutual benefits.
7.45 p.m.
Baroness Warwick of Undercliffe: My Lords, it gives me enormous pleasure to rise to compliment the noble Lord, Lord Maginnis, on an excellent maiden speech. It was not only thoughtful but inspirational. I warmly welcome him to the House. I am particularly pleased to congratulate the noble Lord not only on the 23 years that he spent as a village schoolmaster, which I did not know, but also on the years that he spent as the vice-president of the Council of the University of Ulster. The noble Lord is another excellent addition to our debates on universities.
That university, along with its sister university, Queen's University Belfast, has made such a contribution not only to the cultural and social vitality of the Province but also to its growing economic success. The noble Lord, Lord Maginnis, has given outstanding service to his Province and outstanding parliamentary service in another place. He has devoted his attentions particularly to defence and policing. But I am sure that we can look forward to his speaking on many subjects in your Lordships' House in the future.
We look forward to that.
I turn to the subject of the debate. I declare an interest as the chief executive of Universities UK. I thank the noble Baroness, Lady Sharp, for introducing this timely debate on a difficult issue, and for her speech. The noble Baroness looked not only at the past but also at the way in which the situation has improved. I hope it will improve further.
University vice-chancellors are aware of the many problems outlined by the noble Baroness associated with the use of short and medium-term contracts in higher education. I want to use this opportunity to describe their efforts to deal with the challenges that the situation presents. Their commitment to making improvements in this area reflects a firm conviction that productive, high-quality research depends on the sector's ability to recruit and retain the best possible staff. But we should not forget that we also need to look at the way the Government fund universities if we are to tackle properly the issues raised by the noble Baroness.
It is certainly true that universities employ many more staff on short-term and fixed-term contracts than they used to. That can lead to problems of job security and career progression. It is perhaps most of all an issue for research staff, some 30,000 of whom are employed on these types of contract. There is nothing wrong with spending a short time as a post-doctoral researcher. But extended use of such short-term and fixed-term appointments is certainly undesirable.
Universities are in no doubt about their obligation to treat all their employees fairly and to offer them opportunities to develop their careers. Like any other organisation, universities want to employ the expert

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staff who are vital to their success. However, universities face acute operational and business pressures. They have to be competitive. They are subject to market forces and must remain efficient and flexible to meet the challenges of the future.
In so doing, universities depend on a variety of sources of funding. Some of them are increasing and some are declining but nearly all of them are variable and insecure. For example, the volume of project grants from the national research councils and charities has risen sharply in recent years as has research undertaken for business and industry. But funding for both of those is for defined, time-limited projects. As a result, universities have little choice but to rely mostly on fixed-term contracts for the staff directly employed on those projects.
But universities certainly are not complacent about what they need to do to improve the conditions of those who work in them. They are tackling the problem in several different ways. Universities UK is represented on the Research Careers Initiative strategy group, which was established in 2000 with the support of the Minister for Science. It has produced a series of reports. The most recent one appeared in September. The RCI helps universities to promote career development of their contract researchers, the majority of whom—I stress this point—will not obtain permanent academic posts. The RCI's support includes addressing researchers' specific needs for training, career guidance and staff development. Many contract researchers need support to help them to move into other areas of work—for government or industrial research—where they build on their post-doctoral research experience.
There is little doubt that all that activity has resulted in measurable improvement, although, as I said, a great deal more needs to be done. There is clear evidence of high-level commitment to change, both within the sector and outside. Funding incentives have been introduced to encourage institutions to give greater priority to human resource issues. Clearer, stronger career structures for research staff are emerging, supported by revised institutional policies and practices that give greater recognition to the interests of that group. Measures are being developed to enable institutions to evaluate their performance in managing staff and research staff are central to such initiatives.
Institutions will also have a role in actively managing access to funding. They will need to support the development of research teams that can secure the income necessary to sustain them. They will also want to offer rolling contracts to those staff whose strengths match the funding opportunities available.
However, short-term contracts are not restricted to researchers. I turn to what is being done by the joint working group on staffing in higher education, set up in the wake of the 1999 Bett report. The report concluded that there was indeed scope for many institutions to reduce their use of fixed-term and casual employment. The group comprises the Universities and Colleges Employers Association and higher
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education trade unions. The group has published a guide to good practice for fixed-term and casual employment in higher education and helps institutions to balance levels of short-term and casual contracts with the demands on them to retain their flexibility.
I am pleased that those central initiatives have fed through to changes on the ground. In an interesting development, individual universities are leading efforts to identify and disseminate good practice. One project group, led by the University of Sheffield, is considering appraisal; the University of Manchester is leading a study to track career trajectories; and the University of Loughborough is considering continuing professional development. Those are just three of many initiatives, which are beginning to make a real difference.
My final point is that there must be a fundamental rethink of how universities are funded if their reliance on short-term contracts is to he reduced—especially for staff outside research. It is well known that the unit of funding for universities has progressively declined over recent decades. I do not want to dwell on the past, but it is nevertheless true that the level of universities' core funding, combined with uncertainty about the size of total allocation from year to year, is central to this issue. The cumulative effect of the declining unit of resource is that universities lack the financial security to underwrite the risks of longer term employment contracts in project-funding areas.
That is one reason why in the spending review submission of Universities UK, we have made clear that extra resources are needed to invest in university staff. Just as importantly, any increases in funding need to be in core funding, to allow universities the flexibility to offer good terms to the staff whom they employ and value. Of course, I do not expect any announcement of extra resources today, but the Minister's comments on the value of stable core funding would be most welcome.
7.54 p.m.
Baroness Walmsley: My Lords, I thank my noble friend Lady Sharp of Guildford for introducing the debate. Her account of her own case history explained more clearly the problems that we face with the rise of short-term contracts in the higher education than ever could any set of statistics. I also thank the noble Lord, Lord Maginnis of Drumglass, for his distinguished contribution to the debate and welcome him to your Lordships' House. Let us not be downhearted by the shortness of the list of speakers for the debate. As my grandmother said, good things come in little parcels.
As we have heard from my noble friend, the phenomenon of the rise of short-term contracts has occurred for many years. It applies to both teaching and research staff in the higher education sector. Almost half of all lecturers work part-time, are paid by the hour and are on short-term contracts. Those are not outside experts retained for a particular project but lecturers needed year on year to deliver regular courses. About a quarter of all academic staff are

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contract research staff—mostly full-time but also on short-term contracts. Like my noble friend, many of them have had years on such contracts.
The main concern must be quality. The quality of teaching by staff on repeated short-term contracts may not be of the best. Although the opportunity to gain a variety of experience may be seen to be an advantage, there are fewer opportunities to bed in at an institution and climb the academic tree in one place.
A report of the Further Education and Funding Council Inspectorate found that lessons taught by part-time staff were not always as good as those taught by full-time staff. Many part-time staff are on short-term contracts. Those contracts may affect career prospects of lecturers and the students whom they teach. There are also concerns about systematic monitoring of the performance of short-term staff and the ability to deliver continuity of course provision to students.
It is important for universities and colleges to devote sufficient time to the integration of contract staff—familiarising them with the course and the institution. The establishment is on a constant learning curve when it has a large number of short-term contract staff. The learning curve is a period well recognised in industry as requiring especial effort and investment.
The concordat introduced following the 1995 report of your Lordships' Select Committee sets out two objectives: improving career management and providing long-term support for research staff. How well have those objectives been realised?
Another concern is whether consistency of the examination system and student grading can be maintained when many staff are on short-term contracts, so that results are properly comparable year on year and from one institution to another. There are further concerns about the conditions of work of short-term contract staff compared with those in permanent establishment—as graphically described by my noble friend Lady Sharp of Guildford. Especially in the sciences, the high turn-over of lecturers and research staff introduces a series of hiccups into the otherwise smooth progress of a department or project.
The 1994 report, Learning from Audit, published by the Quality Assurance Agency for Higher Education noted:
"audit reports seemed to suggest that many part-time, casual and short-term staff were excluded from institution-based appraisal, staff development and promotion schemes".
Has anything changed since then?
The situation described by noble Lords presents enormous challenges to the human resource departments of higher education institutions. We have heard from the noble Baroness, Lady Warwick, about how they are tackling those problems. The Government would not expect a school to develop an individual ethos and personality—which they say that they want—if that school were staffed by a lot of teachers on short-term contracts. Why should they expect a college or university to do so? It is difficult for
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any institution to establish the loyalty and corporate spirit for which we would hope under the circumstances described by my noble friend.
We on these Benches believe that it is a question of the right balance between the enrichment, flexibility and economic benefits of short-term contracts—mentioned by the noble Lord, Lord Maginnis of Drumglass, and the noble Baroness, Lady Warwick—and the problems of stress, pension problems, mortgage difficulties and difficulties with continuity, quality, consistency and the monitoring of the delivery of courses mentioned by my noble friend.
8 p.m.
Lord Rotherwick: My Lords, I, too, thank the noble Baroness, Lady Sharp of Guildford, for initiating this important debate. I congratulate the noble Lord, Lord Maginnis of Drumglass, on his excellent maiden speech. As a former Army officer who served in Northern Ireland, I am deeply impressed by his reputation and gallant record. He served in the Ulster Defence Regiment and later as an MP for Fermanagh for 18 hard years. One can conclude only that he is a courageous man. We welcome him to your Lordships' House and look forward to hearing from him on many occasions.
The National Union of Students stated that,
"The increasing tendency to employ lecturers on a part-time and temporary basis leads to diminishing teaching quality as well as demoralisation in the workforce due to job insecurity, poor pay and poor conditions".
In September 2001 around 60,000 academic staff were employed on fixed-term contracts in the UK. A recent report suggests that universities are second only to the catering industry in the "casualisation" of their workforce. During a period of 18 years it is possible to have a contract renewed at least 54 times in the higher education sector. Those facts do not make for happy reading. If the Government wish for high quality teaching in further and higher education, surely they should be resolving the situation.
We on these Benches have no objection to the use of short-term contracts when their use allows for a degree of flexibility both for the benefit of the institution and the needs of some individuals. However, as I shall emphasise today, the degree of reliance on short-term contracts and the reasons given for them goes well beyond that, which is neither sensible nor makes for effective management of further and higher education. It also deters many highly qualified staff from taking up posts at a time of great shortage.
Why has "casualisation" taken place? The usual argument is that the dependence of universities on "soft money" from contracts and awards renders fixed-term contracts expedient. Fixed-term contracts allow the flexibility that is required to deal with uncertainties in the universities' year-by-year funding allocation.
Long-term structural changes are also responsible. Core funding is allocated more precisely and often tied to numbers. The volume of research has grown enormously, mostly on "soft money" from research

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councils and commercial sponsors. Senior academics have become managers of research, chasing contracts and deploying large numbers of short-term staff. To maximise their effectiveness and cope with larger numbers of students, these "managers" are using part-time, short-term and casual staff to spread the teaching load.
A number of interesting issues have arisen from "casualisation". Those issues are not conducive for the nurturing of high quality students in further and higher education sectors, nor are they good for encouraging high-quality teachers and lecturers to settle in a career dedicated to the nurturing of these students.
Sexual equality is an issue. Half of women academics are on short-term temporary contracts. In some universities—for example, St Andrews—women are nearly twice as likely as men to hold fixed-term positions, with contracts lasting as little as three months in some cases.
The prospect of a stable and stimulating teaching career is becoming less attractive. Short and medium-term contracts make the teaching and lecturing professions unappealing to those who might otherwise enter them. Without sufficient teaching staff, it will not be possible for universities to deliver the kind of student increases envisaged by the Government. The Guardian of 1st May 2001 stated that:
"The job is bedevilled by insecurity and only 5% have a modicum of stability".
Difficulties at work are also an issue. Similar to the view expressed by the noble Baroness, Lady Sharp of Guildford, Dr Clare Goodness of the Climatic Research Unit, UEA, said:
"It certainly affects morale. You tend to be excluded from some of the decision-making structures in the university. You do very much feel like a second-class employee. You also have to spend a lot of time writing proposals and trying to bring in more money".
Stress is another factor. A pilot survey issued by the Royal Geographical Society (with the Institute of British Geographers) found that almost two-thirds of contract researchers and teachers in geography fear that insecurity at work is affecting their health and well-being. Almost 40 per cent of those surveyed felt that being on a temporary contract had a negative effect on their work.
Personal finance is also an issue. In many universities, contract researchers cannot hold grants, nor are they entitled to sick pay, study leave or other benefits available to permanent lecturers.
Let us look at some of the disadvantages to students. There is the geographical instability of short-term contracts which are often scattered around the country. For those students who are taught by contract researchers, that could mean a change of lecturer, supervisor or even teacher every few months. What is more, those people are teaching by the hour, which means that there will be little available assistance to students out of class.
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The European Community directive on fixed-term employment is intended to help those on short-term contracts. It aims to prevent discrimination against fixed-term workers and to prevent abuse arising from successive fixed-term employment contracts.
In March 2001, the Government proposed draft legislation to implement the directive. The regulations would outlaw less favourable employment conditions for fixed-term staff compared with their permanent colleagues and limit successive fixed-term contract employment to four years. However, pay and pension benefits are excluded from the legislation. Furthermore, the four-year limit could be exceeded where it was justifiable on objective grounds. Those grounds are not defined. Can the Minister say when the Government propose to bring forward such legislation?
In conclusion, it seems that the predominance of fixed-term contracts can be detrimental to staff morale, the quality of research and the quality of teaching. What action do the Government intend to take in order that our universities have a good employment structure in place for teachers and lecturers? The structure must encourage well qualified people into the teaching profession; promote teaching talent, academic achievement and excellence in research; and inspire more young people into further and higher education.
At present the Government talk about measuring their higher education policy by the percentage of the student population entering into university. Surely the Government should measure the success of their higher education by the number of students who finish their courses with quality degrees. That system must be reliant on a high-quality, dedicated army of teachers and lecturers.
8.8 p.m.
Lord Davies of Oldham: My Lords, I am grateful to the noble Baroness, Lady Sharp of Guildford, for introducing the debate on an issue which is crucial to the future prosperity of our country. I am pleased that the noble Lord, Lord Maginnis of Drumglass, decided to choose this debate in which to make his impressive maiden speech. He sought to impress upon the House—and he did indeed impress us—two points. He said that education could engage the emotions in terms of our desire for the highest quality of provision, and I share with him that emotive commitment to the value of education. He also spoke of the fairness implicit in a level playing field, particularly for staff, and in their relativities to people who work elsewhere. Certainly, the matter needs to be addressed. The Government fully recognise that teachers in all sectors of education deserve proper reward and high value from the community for their contributions. Lifelong learning is central to the Government's plans. We recognise the need for a highly qualified and skilled workforce and a research base of the highest quality if we are to punch above our weight in the international marketplace in future.

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In responding to the points made this evening I should like to consider the question of staff contracts in both further and higher education in the wider context of both standards and responsiveness. Perhaps in this Chamber in the past we have been guilty of giving precedence to higher education. As the noble Baroness, Lady Sharp, and others indicated, this issue obtains as much in further education as in higher education. I hope to address these issues on fairly equal terms.
Three themes underpin our post-16 agenda: widening participation, responsiveness and standards. I hope and believe that your Lordships recognise and support widening participation in lifelong learning and note the role played by further education in increasing access to higher education. It cannot be right that only some 40 per cent of young people from lower socio-economic groups go into higher education compared with 70 per cent of those from higher socioeconomic groups. Social inclusion, surely, means giving every young person a sense of worth both to himself and herself and to society, and the education service has a key role in communicating that.
Responsiveness is perhaps more complex and clearly includes the terms on which institutions in the post-16 sector employ staff. For too long we have not connected post-compulsory education closely enough with the world of work and it is now time to make that connection clearer. That does not mean tying public expenditure to commerce but being more sensitive to meeting the needs of the economy by ensuring that public funding goes into further and higher education. To achieve this, post-16 institutions must engage with industry. That is part of my response to the valuable points made by the noble Baroness, Lady Walmsley. Such engagement with industry and the wider world must necessitate a range of part-time provision where people working in one area contribute to the education service and have experience of both sectors. This means that we need flexible contracting arrangements and an increasingly fluid boundary between educational institutions and the wider world. Does that not clearly imply flexible terms and conditions for staff in publicly funded post-16 institutions?
I remind your Lordships that in 1993 in both FE and HE we moved to a position where institutions were autonomous and had freedom to determine the pay and conditions of their staff. Since then they have worked hard to ensure that their employment practices are consistent with best practice in the public sector, including the fair treatment of fixed-term and part-time staff. Part-time and contract staff may need additional support if they are to make an effective contribution, and that too is gaining recognition. Staff are the key resource for post-16 learning and the Government have made support available for good working practices.
I hope, therefore, that the particularly graphic illustration offered by the noble Baroness, Lady Sharp—the fact that she was perhaps treated as a second-class citizen within the institution because of her status and the work that she did—is recognised as
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a thing of the past. The contribution of my noble friend Lady Warwick indicates just how sensitive higher education institutions are becoming to the necessity to value part-time staff and short-term contracts and also to recognise the importance of such staff being fully integrated into the HE institution on terms equal to those which apply to their full-time colleagues.
In further education there has long been a tradition of flexible working practices and secondments into and from industry. Some two-thirds of college staff now work part time and about half are on temporary contracts. There is now a move for all FE staff to obtain relevant qualifications, starting with new entrants this year. Support for this is provided by the standards fund for existing staff without qualifications, the invaluable work of the FE national training organisation on standards for all staff in the sector and the teaching pay initiative—£300 million from the Government over three years—to restore career pathways. Part-time staff are vital to further education. All of the initiatives that I have mentioned show that action is in hand to enable them to deliver education and training of the highest quality alongside their full-time colleagues.
As has been mentioned by several noble Lords who contributed to the debate, Sir Michael Bett's independent review of higher education pay and conditions looked into fixed-term contracts. It found that overall 26 per cent of HE staff had fixed-term contracts and 93 per cent of researchers were on fixed-term contracts. The Bett committee found that pay and conditions for fixed-term contract staff were generally as good as those for permanent staff, although there was some anecdotal evidence of fixed-term staff being treated less favourably than permanent colleagues when it came to promotion. I hope that the observations vouchsafed by my noble friend Lady Warwick about the extent to which HE institutions are addressing themselves to these issues guarantees that fairness between different categories of staff is an important priority for HE institutions.
There is no evidence that students suffer as a result of the employment of contract or part-time staff in higher education. NATFHE recently published the report In front the Cold about part-time lecturers in higher education which did not uncover any problems in this area. Membership of the Institute of Learning and Teaching helps lecturers to ensure that they are equipped with the skills necessary to be able to give a high standard of teaching to their students. The ILT encourages membership of part-time staff, which represent approximately 9 per cent of the 8,500 membership of that institute.
I turn specifically to fixed-term staff in higher education. In 1999 a joint working group comprising representatives of the Universities and Colleges Employers Association (UCEA) and the HE trades unions was set up to look at Bett's recommendation that there was scope for many HE institutions to reduce their use of fixed-term employment. As a result, UCEA issued guidelines to the sector on casual and contract employment. The report Fixed-Term and Casual Employment in HE—a Guide to Good Practice

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was published in June 2000. It recommended that institutions should seek to reduce the number of their staff on fixed-term contracts and develop more detailed local agreements with their recognised unions.
I recognise that the pace of change may not be as rapid as we all hope, but there is no doubt about the commitment of HE institutions to ensure that good practice becomes universal. Since then there has been progress more generally on HE pay and conditions. Earlier this autumn, the eight HE unions accepted the 2001 pay deal offered by the Universities and Colleges Employers Association. The deal involves the creation of a single joint negotiating committee and a single pay spine for all staff. The new pay machinery provides employers and unions with a vehicle to modernise pay and conditions for HE staff and to pursue the issues raised by Sir Michael Bett, including the crucial issue of casualisation.
While pay remains entirely a matter for HE employers and the trade unions, we want to help the HE sector get the new machinery off the ground quickly. It has a key role to play in resolving some of the long-standing issues raised by noble Lords this evening. That is why the Secretary of State has undertaken to provide up to £300,000 over three years towards the start-up costs of the new negotiating machinery. The sector is also taking steps to address the equal opportunities issues which affect all staff but which may have a particularly marked effect on casual, contract and part-time staff. UUK, SCOP and the funding councils have set up an equality challenge framework to promote equal opportunities for all HE staff. At its core is the Equality Challenge Unit, an office-based group of four full-time professional equality staff, which will work directly with institutions to help them to deliver the improvements, monitoring and performance that they have promised in their equal opportunity policy statements.
We recognise that there is only so much that the sector can do without additional funding. That is why we have both increased funding for the HE sector and included £330 million over three years to support increases in HE pay and modernisation of the human resource development in universities.
As regards university research, it is not surprising that Sir Michael Bett found that so many researchers were on fixed-term contracts. It is recognised that the concordat to which reference has been made in the debate has begun to produce some very significant improvements in this area. The Research Careers Initiative, chaired by Sir Gareth Roberts, to monitor progress and identify and encourage best practice is an important dimension of this. As a result, the Office of Science and Technology and the DfES have put resources into the improved career guidance and staff training recommended by Sir Gareth.
Returning, finally, to the issue of standards, the results of FEFC inspections in the further education sector show that the percentage of further education lessons taught by part-time staff judged to be unsatisfactory was 3 per cent higher than for lessons taught by full-time staff.
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What are we to read into this? At face value, it would seem that part-time staff are not a good thing if we are to pursue a standards agenda. But if we look more closely a more complex picture emerges, to which I hope my remarks this evening have done some justice. The key, surely, is that all staff, whatever their contractual position, need to be properly integrated and supported if they are to contribute as effectively as their full-time colleagues. Colleges and universities must recognise this. Indeed, they are doing so, and they are putting in place, with government support, the necessary arrangements.
The noble Lord, Lord Rotherwick, seemed to indicate that these were novel issues derived over the past four years of the present administration. As the noble Baroness, Lady Sharp, accurately identified at the beginning of the debate, the issue of part-time staff has a long history. We need to ensure that we make progress on the integration of part-time staff fully with full-time staff and guarantee that we have a proper structure in universities and colleges to ensure that everyone gets their true deserts.
I entirely accept the proposition of the noble Lord, Lord Rotherwick, that success in higher education should be measured on the quality of the experience of students and their success rates. The success rates of today's higher education institutions bear comparison entirely with the past against a background of the significant efforts made by HE institutions to accept more students.
In my view, higher education is a success story. The number of students is at a record level and the number of applications continues to rise. We are working towards a target of 50 per cent of young people participating in higher education by 2010, with a clear focus on widening participation.
We have taken some tough decisions on funding. Since 1996, the total additional funding for institutions is £1.7 billion, an increase of 37 per cent in cash terms over the six years up to 2003–04, an 18 per cent increase in real terms. With 1 per cent of the world's population, the UK carries out 4.5 per cent of the world's research. We have demonstrated our commitment to help sustain world-class research with the announcement in 2000 of substantial funding for science.
As far as concerns further education, we have pumped an extra £527 million into FE budgets this year alone, a 12 per cent increase in real terms this year, with another 3 per cent next year. Total spending per full-time equivalent student is up by 4 per cent in real terms this year.
Of course there are issues of fairness between groups of staff in both further and higher education institutions. It is essential that we ensure that students taught by part-time staff enjoy exactly the same quality of experience as those taught by full-time staff. There are many challenges ahead of us. It is obvious from the debate that both higher education institutions and further education institutions are well aware of the obligations that they have to part-time

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staff, both in research and teaching. I am quite sure that we will see significant progress in this area in the years ahead.

Anti-terrorism, Crime and Security Bill
8.25 p.m.
House again in Committee on Clause 17.
Lord Phillips of Sudbury Lord Phillips of Sudbury moved Amendment No. 49:
Page 7, line 7, after "authority" insert "pursuant to an authorisation order"
The noble Lord said: This group of amendments is important. Amendment No. 89 sets out a proposed new clause dealing with what are called "authorisation orders". Such orders would be the only method by which public bodies could be put in the position of having to consider disclosure under Clause 17.
In the light of what the noble Lord, Lord McIntosh, said earlier, I should explain briefly why we believe that this major change to the Bill is essential to its fairness and fair working. The noble Lord made the point two or three times that many of the objections to Clause 17 are misplaced because the workings of the clause will have to be consonant with the requirements of the Human Rights Act, and he referred to the aspects of the Human Rights Act which deal with proportionality and reasonableness.
However, although I am a great supporter of the Human Rights Act, both in concept and now, it has always seemed to me—I am not alone in this—that it would be a bad day for Parliament if it resorted to legislation which failed to grapple with the details, particularly as they may affect civil and individual liberties, but in every case fell back on the parrot cry, "Well, don't worry, old son, you've got the Human Rights Act". We on this side of the House feel very strongly—and I know that the main Opposition party concurs—that it is vital that the protections which, in our view, should be integral to what the noble Lord, Lord McIntosh, admitted was a huge extension of disclosure, should be clear, practical and useable. Above all, using the Human Rights Act to get at your remedy if the remedy is not on the face of the Act is an extremely uncertain business, not only because the Human Rights Act is couched in the most wide and general terms but because the only way of getting those protections is by court process. I need hardly tell the Committee that going to law to obtain protection against unfair disclosure, or against the denial of a disclosure that should be given, is not practical. There is no legal aid for that sort of case. The costs are way beyond the resources of anyone, other than through an organisation with a strong commitment to the legislative principles.
Therefore, we are convinced that the Government will do well by their own purposes, and certainly by those who have to use the provision—and it will be mightily well used—if they provide the clear
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authorisation procedure proposed in the amendment. We are not hanging our hat on every jot and tittle of the proposal. We are open to suggestions from the Government as to how it might be improved and these could be examined at the next stage of the Bill.
In addition, there is a big problem for applicants for disclosure, as well as for those in respect of whom the disclosure applications are made. Without the provision suggested in the amendment, the public authority receiving the request for disclosure will, first, have to decide whether it falls within the terms of subparagraphs (a) to (d). Secondly, it will have to decide whether the Human Rights Act comes into play. In order to determine that, it will probably have to engage in a dialogue with the person making the request in order to elicit a good deal more information. It will then have to apply the Human Rights Act to the prevailing facts and circumstances. That will be an extremely difficult task. If the Human Rights Act does apply, it will then have to decide whether the disclosure can be made, and whether it should exercise its discretion in making the disclosure. The final decision will be subject to judicial review although, again, that may be more a theoretical than a real problem.
In all this, I have made no mention of the individual whose confidential information is the subject of the disclosure request. Let us not forget him or her. As matters stand, if all we are doing is relying on the Human Rights Act, he or she will not even know that a request has been made, let alone by whom or why. The person will not know whether the request has been granted, or whether the disclosure request has been dealt with fairly. There is no oversight of the whole system or the working of this vital part of the legislation, such as is provided for in the Regulation of Investigatory Powers Act in the form of the commissioner.
For all those reasons, and others, we believe that it is in the interests of public authorities and the individuals whose confidential information is at stake, and in the public interest, to have a clear system of controlling the disclosures allowed for by Clause 17.
Perhaps I may turn briefly to the particular proposal. In relation to subsection (1), it requires a judge to determine the applications made for disclosure. In relation to subsection (2), if he makes an order it must specify the information to be disclosed—that is surely helpful to all concerned—and the purpose for which the order is made; namely, whether it is made under sub-paragraphs (a), (b), (c) or (d). The authorisation will make the disclosure subject to such requirements as the judge thinks fit. That is an extremely useful provision. It will allow a judge to make necessary conditions in all the circumstances, one of which may be that the order is brought to the attention of the person whose confidential information is at stake. Then the order must be served on the public authority in respect of which the disclosure request is made. We go on to prescribe evidence on oath. There must be reasonable grounds for believing that the public authority holds the

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information, that the information is not liable to disclosure by other means, and the whole is to be heard in secret.
Such provision may seem cumbersome, but it provides a clear framework within which all of this could function. It would reduce at a single stroke the widespread public concern over Clause 17 as drafted. On those grounds, I commend the amendment to the Committee. I. beg to move.
8.30 p.m.
The Earl of Onslow: Is it right for a Back-Bencher to enter the debate at this stage? The noble Lord, Lord Phillips, has demonstrated, first, that he has a complete grasp of an extraordinarily complicated subject, which I, frankly, do not have. I am not a lawyer. If I wanted to bring a case under the Human Rights Act, I think I should instruct the noble Lord, to the immense benefit of his practice, I hope.
The noble Lord is pointing out that there is an element of sloppiness in the Government's thinking. That is either due to idleness or because they have not had time to get it right. It could be a case of, "We just want to make sure that we can do anything, just like that. We can grab anything. If the legislation is not tight, it does not matter". That attitude of mind runs all through the Bill. It is an unattractive attitude of mind. I hasten to add that when some of my noble friends were in government such temptation did not always pass them by. It is a habit of government.
Those of us who, for the benefit of their country, have never been allowed near a Front Bench in any circumstances are entitled to point this out. We are by nature natural libertarians and rebels. We want the Government to legislate tightly. If they do not, my learned friends buy more villas in Zurich out of the fees that they generate by going to the human rights court on this matter or that. It is as simple as that. My noble friend Lord Phillips—I call him "my noble friend" because I have always been attracted to his libertarian point of view—is doing himself out of pounds, shillings and pence by making sure that the Bill is properly, tautly and correctly drafted so that the objects that the Government say they want are clear and concise and we know absolutely where we are.
There is too much sloppiness. That was demonstrated in relation to the previous amendment. The Minister said that when making a forfeiture order we may not know that it is to do with terrorism when we start. I did not like that. That tendency runs the whole way through the Bill. I suggest that it is the duty of this place to tighten up the legislation, not only for the sake of the country but for the sake of the quality of government legislation.
Lord Elton: The trouble with this procedure is that Back-Benchers like myself do not have time to inform themselves to the extent that they should, and therefore have to ask questions which would otherwise be superfluous. I do not know whether this is the occasion to ask for this information from the Minister, but I hope that he will find an occasion to explain to
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me the effect of subsection (2). I understand that it places all the provisions listed in Schedule 4 in a new sort of category described in paragraphs (a) to (d). That is clear enough. But the effect of those categories is not clear. No doubt it is clear to noble Lords who are familiar with this ground. It would help in our assessment of what is said if we could be told.
Lord Hylton: As was mentioned in the debate yesterday, the words "any criminal investigation whatever" and "any criminal proceedings whatever" are very wide indeed. This seems to me to have a bearing on personal privacy, on confidentiality and on economic and business matters. On those grounds this series of amendments is helpful. The amendments give clarity and precision to the Bill and I am strongly in favour of them.
The Earl of Northesk: I support the amendment of the noble Lord, Lord Phillips. I also apologise for returning to the Chamber a little later than I would have wished. I accept the strictures of my noble friend Lord Onslow about the complexity of the issues before us.
I want to make one important point. As I suggested at Second Reading, the provisions of Part 3 taking in tandem with those of Part 11 represent a regime of management of personal date by public authorities which is of an entirely new character. These proposals could be said to constitute a form of data matching and/or data sharing throughout the machinery of government.
Perhaps I may address the Minister's remarks prior to the dinner break. In so far as the Minister argues that there are "no new gateways" he is correct. That is not the point at issue. It is, to use the Minister's words, that there is a widening of the gateway. I am not convinced that the Minister has satisfactorily explained that point. No one should underestimate the significance of this issue in terms of giving Government control over citizens or how open to abuse such a system would be.
Because the regime would integrate data in entirely new ways, it involves categorically new and more perilous dangers. Necessarily, therefore, new methods should be contemplated to offer protection. Unfortunately the Data Protection Act was not constructed to address this problem. Indeed, the words of the noble and learned Lord, Lord Falconer, which I quoted at Second Reading would seem to imply that the policy contained in these proposals was not even a twinkle in the Government's eye during the passage through Parliament of the Data Protection Act. As a result, although useful, that Act provides no concrete limitations as to how data can or should be dealt with once it has been lawfully acquired by law enforcement.
Moreover, principally because of the enactment of the Regulation of Investigatory Powers Act the ability of the Data Protection Act properly to enforce subject rights and the data protection principle has been compromised, at least in part, because of what could be called tensions between the two Acts. They pull in different directions.

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For those reasons, an entirely new authorisation procedure, as suggested by the amendments, is necessary, partly to address the very much greater risk posed by the wholesale data matching regime being made available to public authorities and partly because the Data Protection Act was not designed to deal with this problem.
Baroness Buscombe: I support the remarks of the noble Lord, Lord Phillips of Sudbury, in relation to the amendment.
Lord McIntosh of Haringey: Let me agree with the noble Earls, Lord Onslow and Lord Northesk. These are complex problems and they are complex amendments. I pay tribute to the care which has gone into their framing. The central aim of this part is to allow—with the safeguards of the Human Rights Act and the Data Protection Act (and I shall return to that point in more detail in a moment) and the duty of confidentiality which is not taken away by this Bill—public authorities voluntarily to disclose information to agencies involved in criminal investigations. They are already permitted to do so—I have said this more than once but it is important to state it—in relation to criminal proceedings and, as the noble Earl, Lord Northesk, recognised, I said that this part simply widens the gateway to include investigations.
Let me pause for a moment to consider the ability under present legislation to disclose information in relation to criminal proceedings. That has been going on for a long time. If it had caused any of the problems suggested here, surely those problems would have arisen by now.
8.45 p.m.
The Earl of Onslow: How does this clause affect September 11th?
Lord McIntosh of Haringey: I shall develop my argument. I shall make that point, as I have done in response to preceding amendments. It is a valid question and I do not duck it because it is important.
It is important that we should realise the practical effect of the amendments. It would be to transform the aim that I have described in this part of the Bill into a form of judicial control over disclosure which might well prevent some of the most important pieces of information being disclosed in time. The noble Earl, Lord Onslow, buries his head in his hands. He has a continuing complaint about our argument that it is not possible always in advance and in time to define what is a terrorist offence because there is no proper definition and, therefore, we have to include criminal investigations and criminal proceedings. But if we are investigating someone who is a potential terrorist, we have to act on the spot; we have to act at the time. The effect of the amendments would be that an authorisation would have to be sought from a judge by the person seeking the information. That information would have to specify what is being sought and it is not
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always possible to know what is being sought. That procedure would have to take place before the request for information could even be put to the public official who has to decide whether to give the information.
The Earl of Onslow: As regards the history of obtaining warrants, magistrates can be woken up in the middle of the night. Judges can be incredibly rapid in producing the right permission if they are asked by the right person. They will be woken up in the middle of the night. It is possible to do that. All one is saying is that the ancient rights of Englishmen should not be sacrificed through a perfectly justifiable fear of what occurred on 11th September. We must always be careful to protect those rights. The system is sufficiently flexible if it is properly channelled to protect those rights. I think that that is what the noble Lord, Lord Phillips, is saying. That is what the noble Lord, Lord McIntosh, does not accept as possible. I know that he is sincere; I know that he is a good lad. But I do not believe him in this case.
Lord McIntosh of Haringey: I think that every Member of the Committee should put themselves in the position of those involved in investigations of terrorists and consider the ease with which supporters of Al'Qaeda, whoever they may be, can move from one country to another, from one place to another, and can conceal or destroy evidence which might connect them with the organisation. In this country, we are not always in the position of the retreat from Kabul where the Al'Qaeda had to leave houses full of evidence of their involvement in international terrorism. It does not work that way in this country. If we have delay of the kind involved in prior judicial control, we will lose the scent; we will lose the information; we will lose the opportunity to deal with potential terrorists. It has to be done immediately.
The Earl of Northesk: As I explained at Second Reading, under the RIP Act, the law enforcement authorities are given authority to obtain and retain data, and so on. I do not see the virtue of the argument that the provisions are about giving information to law enforcement that it would not otherwise have.
Lord McIntosh of Haringey: The argument is that we have had the power to ask for information relating to criminal proceedings. If we restrict the power to criminal proceedings, we shall lose the scent and the ability to catch people who are terrorists or supporters of terrorism in this country. That is why it is being extended from proceedings to investigations. If there had been a major problem with proceedings, no doubt somebody would have told us.
The Earl of Northesk: I apologise to the Committee, but I should like to clarify that point by quoting directly from the front page of today's Evening Standard, which says:
"The initiative, codenamed Operation Landmark, was the result of a painstaking 10-month investigation by the National Crime Squad and follows an analysis of 16 days' internet traffic to

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33 paedophile internet groups. Officers discovered data from 9,800 individuals throughout the world who were asking for images of children".
The law enforcement authorities appear already to have the necessary powers on the disclosure of information.
Lord McIntosh of Haringey: I cannot complain about the noble Earl, Lord Northesk, quoting from the front page of the Evening Standard, because I have already done the same this evening, although from an earlier edition. I have not seen the article to which he refers, so I do not have anything useful to say about it.
However, I have something useful to say about the other constraints on the process. The noble Lord, Lord Phillips, spoke as though the only constraint was the Human Rights Act and the Data Protection Act was not effective for this purpose. The Data Protection Act will apply in most cases, imposing restrictions on disclosure. It also gives the individual the right to ask the data controller what disclosures about them have been made in certain circumstances. The Data Protection Act is policed by the Information Commissioner. Surely that provides an alternative avenue of redress. If we add to that the fact that the duty of confidentiality on public officials towards patients or customers is in no way diminished by the provisions of the Bill, it will be seen that, although this is an extension, it is a justifiable one.
I wish that the noble Baroness, Lady Park, was in the Chamber, because this is about intelligence. All that we know about the prevention of terrorism has highlighted the need for the co-ordination of agencies, particularly when there is a clear case for the free flow of information and a need for clear and effective channels. All that is implicit in the Bill. The prior judicial control required by the amendments would put at risk the intelligence work that is essential for that incredibly difficult task.
The provisions will mean that public officials understand their obligations better, especially thanks to the publicity that has been given to the matter in the past few days. That means that they are more likely to respect the safeguards.
I have to come back to the point made by the noble Earl, Lord Onslow. Of course we cannot limit the provisions to terrorism as such, because of the interaction between terrorism, drug trafficking and money laundering. Drug trafficking and money laundering are very often precursors to terrorism or tools for terrorists. If the powers covered only the act of terrorism, we would weaken our ability to deal with terrorism. That is why we need a wider definition.
The Earl of Onslow: The noble Lord mentioned drug trafficking and money laundering. We all agree with the Government that those activities have to be properly policed and stamped on and that people who indulge in them should be chucked away to get a striped suntan. Nobody is arguing with that. We are arguing that using the powers produced by emergency legislation to go on a hunt for a drug trafficker arid then incidentally coming up with something on
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terrorism is the wrong way to do it. By all means do it properly—I believe that there is a new 400-odd clause Bill on the subject in another place—but for heaven's sake let us concentrate on terrorism aspects in this emergency legislation, which is difficult enough for us to understand anyway. It is complex and we do not really have time to digest it. Let us limit its scope as much as we can, not because we are pro-drug trafficking or pro-money laundering, but because we want to get the legislation right in both cases.
The Earl of Northesk: Before the Minister answers that point, perhaps he will address the substance of the question. Do the provisions in the Bill open up the possibility of an enormously wide range of data matching and data sharing across public authorities? Parliament has previously sanctioned such behaviour on a case-by-case basis via primary legislation.
Lord McIntosh of Haringey: I think that I can deal with both those points at the same time. The noble Earl, Lord Onslow, talks about a hunt and the noble Earl, Lord Northesk, talks about data matching. They are both basing their comments on the false assumption that it is possible for investigatory authorities to conduct a trawl for information. That is not the case. Clause 17(2) simply defines in extenso what is meant by a criminal investigation. There is nothing more sinister than that. Public authorities involved in criminal proceedings or investigations can ask public officials for information relevant to their search. The list of such public authorities is quite limited. It does not remotely cover all public authorities and is nothing like the definition of public authorities provided in the Human Rights Act. If they are required to specify exactly what they want in advance to a judge, they will run the risk of missing it and of asking for the wrong thing.
Under the clause, the public official has to decide whether there should be disclosure of the information that he has in his power. He has to bear in mind the relevant data protection and human rights legislation, the duty of confidentiality and all the other protections that we have when weighing up whether it is relevant to the case and whether he is justified in disclosing it for the purposes of the investigation. I repeat, if we deny that possibility, we will weaken the intelligence effort and reduce the chances of catching terrorists. That will leave us all a little bit more at risk.
To require judicial control at the beginning would not only cause a delay, it would require the investigatory authorities to know more precisely what they are looking for than is likely at the early stages of investigation and it would prevent public officials from volunteering information that they suspect is relevant to an investigation relating to terrorism. Those are serious defects in the amendments.
Lord Elton: Will the Minister explain to me, as I plod along behind the Committee trying to understand, what there could be in Section 9(1) of the Diseases of Fish Act 1983 or Article 6(1) of the Sex Discrimination

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(Northern Ireland) Order 1976 that it would be necessary to treat retrospectively as though it were connected with terrorism?
9 p.m.
Lord McIntosh of Haringey: No, I cannot. It is not retrospective, but that is not the point. I could have been briefed on every one of them if we had had enough time. That is a defect of hasty legislation—I shall give the noble Lord that for nothing.
Each Act has been included in the schedule because there are items of information collected under statutory powers that could be relevant. I repeat that it is only those items of information that are collected under statutory powers, and each item of information provided under those Acts must be covered by the existing statutory restrictions on disclosure. That applies to the Diseases of Fish Act 1983 just as much as it applies to the Health Act 1999.
Lord Phillips of Sudbury: I am grateful to the Minister for endeavouring to defend the Government's position. I am totally dissatisfied with what he said. The issues around Clause 17 are of the greatest possible moment and the Minister's answer does not hold water. His main point is that, unless the Bill is enacted as it stands and the Government refuse to have a framework or system for obtaining disclosure, terrorists will run amok and the chances of the security and police authorities catching them will be destroyed. That is nonsense.
It has been made clear in interventions that the law as it stands, and as it has always stood, requires that citizens whose houses are to be searched or whose possessions are to be confiscated should be subject to the protection of a magistrates' warrant or order to allow the police to proceed. That action can be carried out with the greatest rapidity. Applications to a judge under the procedure provided for by the amendment could be done virtually instantaneously. A duty judge would be available at a moment's notice to deal with the matter, which can be done entirely orally. We totally reject the notion that the proposal is defective.
I grant that the amendment could be improved if there were added to it something that specifically addresses the imminent threat that might be posed by the discovery of certain potential terrorist activity. But that amendment could be made, which reduces the vestige of the justification of the Minister's argument.
Constant references to the Data Protection Act do not assuage my anxiety or that of anyone else. There was a reference in Clause 45 of the previous Bill, which can be found in Clause 18 of this Bill but which has been excised from Clause 17, to the effect that nothing authorised the making of any disclosure that was prohibited by any provision of the Data Protection Act 1998. In effect it said that the framework of the 1998 Act should not he punctured by the provisions of this Bill.
Protection for the framework of the 1998 Act is punctured by the absence of that provision in Clause 17 of this Bill. The Data Protection Act 1998 is
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one of the Acts of Parliament included in Schedule 4. The provisions of Clause 17 are as wide as the blue sky—at least we all agree on that. The exceptions will now be part of the Data Protection Act arrangements, which means that the restrictions on disclosure provided by that Act vis-à-vis its present and former commissioners, staff and agent, no longer hold and that Clause 17 provisions are written into it.
We view this—I was about to say lacunae, but it is a huge black hole at the heart of the Bill—as undermining its effect. It may look good to give authorities the widest powers that they will enjoy under the Bill, although the Minister's constant references to public officials and official agencies betray the fact that the measure extends far beyond the police and state authorities, as I tried to explain earlier. We on this side of the Chamber will have to give a great deal of thought to what to do at Report stage. We shall certainly table an improved amendment, but I sincerely hope that the Government will consider what has been said tonight. It is not insignificant that not a single speaker in the Chamber has supported Clause 17 as it stands.
The Earl of Onslow: Before the noble Lord, Lord Phillips, withdraws his amendment, I seek a scintilla of hope for those of us on this side of the Chamber who have genuine and deeply held doubts. Will the Government perhaps reconsider and say that it is just possible that we may be right? That would enhance the reputation of the Government and this Chamber. I know that the noble Lord, Lord McIntosh, and I am beginning to know that the noble Lord. Lord Rooker, are both men of independent minds who will listen. They do not have to do anything too publicly but they could say to the Government, "There was something in what old fuddy-duddy Onslow and young Phillips and Northesk had to say, so perhaps we should consider the issue again". That is all that we ask.
I hope that the noble Lord, Lord Phillips, will table some more amendments at Report stage, and I hope that the Government will listen more carefully and intelligently than they have done so far.
Lord McIntosh of Haringey: I want to say something to those who believe what has been said as sincerely as they do; and let us try to avoid personalising the issue: of course it is necessary for us, as far as we can, to restrict the scope of these disclosure provisions. I have explained how we have sought to do so. In so far as the pressure is to continue to restrict the scope of these amendments, those who are trying to do so have an argument on their side which we recognise and share. But at the same time they have to recognise how essential it is in the present circumstances—not just in this country but in the whole world—not to allow potential or actual terrorists to slip through our fingers because of defects in the law. That has been happening and must not be allowed to continue.
Lord Phillips of Sudbury: In the spirit in which the Minister made those last remarks, one of the problems with the pace of the Bill's proceedings is that one does

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not have the usual opportunity to review and discuss. None the less, if the Minister would make time available to contemplate some of the issues that we have talked about tonight, I should welcome that.
I remind the Minister that the Regulation of Investigatory Powers Act that his Government introduced only last year has all the protections for which we are calling in the amendment. It has an Interception of Communications Commissioner; it requires authorisation for every directed surveillance, it has a warrant for all sorts of interventions; it has appeals by Surveillance Commissioners. All that framework is presently contained in the RIP Act. This is a more potentially important piece of legislation than RIPA.
Lord McIntosh of Haringey: First, this Bill does not override the statutory restrictions on disclosure. That is why we need these provisions. Secondly, my noble friend Lord Rooker has already said that he has booked the Ministerial Conference Room 10A on the first floor from 11 o'clock every morning. Anybody from any party who wants to come along after midday on any day that the House is sitting to talk about any aspect of the Bill will be welcome. My noble friend says I have gone a bit wide. But of course we are open to talking to anybody.
Lord McNally: Yesterday both Front Benches paid tribute to the noble Lord, Lord Rooker. He made that offer at that time. Perhaps it would be helpful if we were to serve notice that my noble friend Lord Phillips intends to come along at 12 noon tomorrow and explore with the noble Lord, Lord Rooker, and his officials the areas which are causing concern.
Lord McIntosh of Haringey: It is certainly better to give notice. We can then ensure that the officials who know about this particular part of the Bill are present.
Lord Phillips of Sudbury: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Buscombe Baroness Buscombe moved Amendment No. 50:
Page 7, line 10, after "any" insert "counter-terrorist"
The noble Baroness said: In moving Amendment No. 50, I shall speak also to Amendments Nos. 50A, 51, 53, 53A, 54, 72 to 75, 77, 77A, 78, 91 to 96.
Paragraph 3 of the Explanatory Notes to this Bill states:
"The purpose of this Bill is to strengthen legislation in a number of areas to ensure that the Government, in the light of the new situation arising from the September 11 terrorist attacks on New York and Washington, have the necessary powers to counter the increased threat to the UK".
We shall be covering ground that in some senses has already been covered this evening. But I make no apology for that. Clauses 17 and 19 of this Bill, as presently drafted, go way beyond that purpose.
Clause 17 permits disclosure by public authorities to assist in any criminal investigation or criminal proceedings being carried out in the United Kingdom
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or abroad. Clause 19 allows the commissioners of Inland Revenue and Customs and Excise departments to disclose information to assist any criminal investigation or criminal proceedings being carried out in the United Kingdom or abroad, and also allows disclosure to the intelligence services in support of their functions.
This new power to disclose information, which may have been given in confidence, extends to assist any criminal investigation or criminal proceedings rather than merely terrorism. It therefore goes way beyond the purpose of the Bill and we seek to limit Clauses 17 and 19 with these amendments to permit disclosure to assist any investigation or proceedings relating only to terrorism.
We have serious misgivings about allowing such disclosure, particularly where information has been given to the public authorities, the Inland Revenue or Customs and Excise in confidence. Terrorism is the greater of the two evils and we must prevent terrorism at all cost—almost at all cost. We therefore support the Government as regards Clauses 17 and 19 in so far as they are limited to disclosure for the purposes of countering terrorism.
We are in two minds as to whether disclosure should be permitted to assist criminal investigations or criminal proceedings. We can see that as regards serious crime the balance probably comes down in favour of disclosure. On the other hand, we could not support disclosure for the purposes of minor criminal offences.
In particular, in Amendment No. 96, we ask the Government to amend the Bill to ensure that terrorism has the meaning given to it by Section 1 of the Terrorism Act 2000 and I ask Members of the Committee to refer to Part I of that Act where it makes absolutely clear that "terrorism" means,
"the use or threat of action where … the use or threat is designed to influence the government or to intimidate the public or a section of the public, and … the use or threat is made for the purpose of advancing a political, religious or ideological cause … [if it] involves serious violence against a person … involves serious damage to property … endangers a person's life, other than that of the person committing the action … creates a serious risk to the health or safety of the public or a section of the public, or … is designed seriously to interfere with or seriously to disrupt an electronic system".
It reads very differently from this current Bill.
A line will have to be drawn somewhere, but now is not the time or place to discuss exactly where. There must be wider consultation and further consideration of these two clauses in so far as they will permit disclosure as regards any criminal investigation or criminal proceedings. I thank the Minister for suggesting that we have further discussions outside the Chamber on this particular point. We believe passionately that such a wide power is not appropriate in emergency legislation.
In particular, the General Medical Council has expressed serious concerns with regard to the possible extent and purpose of disclosure of, for example, identifiable patient records under the Bill. I would very much appreciate some assurance from the Minister

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with regard to the concerns of the General Medical Council. In fact, I am saying this on purpose because, if anything, we can at least this evening seek to try to reassure various bodies beyond the Palace of Westminster in relation to these clauses. Unfortunately, as yet we remain unconvinced of the Government's argument. However, I believe that it will help all of us if we have an opportunity now to flush out some of our differences, as we have already begun to do this evening, and also perhaps to check on the record where reference has been to made to this part of the Bill in the media.
The General Medical Council states:
"We are concerned that this Bill may introduce measures that could require the disclosure of identifiable patient records held by the Commission for Health Improvement and the Audit Commission as part of criminal investigation anywhere in the world".
The GMC continues:
"Currently, we advise doctors that they may disclose information in order to 'assist in the prevention, detection or prosecution of a serious crime', usually a crime which will put someone at risk of death or serious harm (such as terrorism). That is because only serious matters will expose third parties to a risk so serious that it outweighs the patient's privacy interest. Disclosure of medical records in relation to non-serious crimes may seriously undermine the trust that is central to the doctor-patient relationship. The Bill does not appear to place any restrictions, or conditions on disclosure of data and it is possible that a police force could simply require records to be disclosed without any justification. [For example, say] we are looking for people who have had 'X' condition or shown 'Y' symptoms). A criminal investigation in this context is defined by the Bill as 'an investigation of any criminal conduct, including an investigation of alleged or suspected criminal conduct, and an investigation of whether criminal conduct had taken place'. We are, therefore, keen to establish the possible extent and purpose of disclosure of identifiable patient records under the Bill. The Audit Commission has access to records and does demand patient information for some investigations. CHI also holds copies of patient records and we are seeking to establish their position on this issue.
The Bill also gives the Treasury, by Statutory Instrument, the ability to add provisions contained in subordinate legislation to the list given in the schedule (4) to the Bill. If there are confidentiality provisions contained in subordinate legislation (and we believe there may be) then it is possible that they might be added in the future".
Perhaps I may also refer very quickly to a transcript of an interview on Radio 4 yesterday, which was included in the "Today" programme, with Beverley Hughes MP. She stated:
"Schedule 4 of the Bill lists all of the pieces of legislation that at the moment regulate that and the only thing Clause 17 is doing is simply making it clear to officials that they can give the specified information earlier on in an investigation and as regards to the NHS the only provisions that are included are the disclosure of the price of medical supplies and information relating to the Audit Commission's financial enquiries into the NHS. There is nothing at all to do with patient records or the doctor/patient relationship whatsoever and as I've said it is an example of the kind of scare mongering we had in relation to parts of the Bill which is very misleading".
The General Medical Council and a fair number of other bodies have been in touch with us in the past 24 to 36 hours on this point. They all say that they cannot agree that the Bill, as currently drafted, reads like that at all. So we are offering the Government an
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opportunity to clarify the situation. So far we are not convinced, but we and many others would like some kind of reassurance on this matter. I beg to move.
Lord Thomas of Gresford: The width of these provisions has already been discussed in previous amendments, but the extension of the existing disclosure powers from proceedings to investigations, and even beyond that to deciding whether an investigation should take place, is, as I understand it, to apply to everything and not simply to terrorism. The purpose of this group of amendments is to try to confine the scope of the provisions; that is obvious.
My Amendment No. 51 seeks to include the words "involving terrorism". Its purpose is to limit the scope of an inquiry for the purpose of this emergency legislation. Those are broad words, "involving terrorism". We have to deal with the argument that the Minister has put forward; namely, that the Government want these wide powers because investigating bodies will not know whether a case involves terrorism until they decide to investigate and then carry out the investigation. I have used the words, "involving terrorism" in my amendment to enable those who seek such information to say, "We are from the security services and it is our duty to investigate the possibility of terrorism and information you may have which may assist us". That limits the scope of the people who can make that inquiry.
If a local police constable goes down to the fish counting centre and says, "I demand to see your records of anthrax infected salmon that have come into the River Dee in the course of the past few months", I imagine that his application for that information may be resisted as it would not appear from such a request that he was a person involved in investigating, or considering the investigation of, terrorism. It seems to me that this clause attempts to encompass the widest investigation or disclosure of information when it could be limited to the scope of the emergency provisions.
Lord Phillips of Sudbury: My name is attached to several of the amendments in the group. I want to make only one point in elaboration of what the noble Baroness, Lady Buscombe, said vis-à-vis health matters and to pick up a point made by the noble Lord, Lord McIntosh, before the dinner break when he was categoric in saying that doctors would not come within the purview of Clause 17. I have to tell him that that is not what Human Rights Practice, which is one of the standard works in relation to the Human Rights Act, states.
The Health Act 1999 is one of the statutes enumerated in Schedule 4. Whereas at the moment health records can be obtained by police only on a circuit judge's order, and only then in respect of serious arrestable offences in respect of UK criminal proceedings, if this measure passes without this set of amendments being accepted, that will no longer be the case. The wide provisions of Clause 17 will be incorporated into the Health Act 1999. There will be no requirement for the criminal matters concerned to

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be serious arrestable offences. There will be no requirement for the criminal matters to be confined to UK criminal proceedings.
As I said earlier, Human Rights Practice states explicitly that doctors working within the NHS, and therefore within the framework of the General Medical Council, are part of a public authority and their records are therefore—certainly in terms of Clause 17—available for disclosure.
Lord Hylton: I believe that this series of amendments is helpful and my sympathies are with it. However, I should like to ask whether the Minister is able to give an assurance that, in principle, no officially held information will be disclosed to countries—for example, those in the former Soviet Union, in the Middle East and in a good many other places—which have criminal justice and human rights systems greatly inferior to our own. I ask that because I believe that such disclosure could put at risk asylum seekers and refugees already in this country and their families who may still be in overseas countries. Such people who remain overseas could be in danger of torture and other serious malpractice.
Viscount Goschen: This series of amendments appears to crystallise the arguments that we put forward in connection with a number of other amendments, including the group containing Amendment No. 37, earlier in this evening's proceedings. The Government have made it clear in a number of statements that the purpose of this legislation is very specific and that the Bill is targeted particularly at countering a heightened terrorism threat. That is why we are agreeing to the swift procedures.
In debate on an earlier amendment—I believe that it was Amendment No. 37—when we discussed the question of including words such as "counterterrorism" in order to make the Bill more specific, the Minister appeared to indicate that that was altogether the Government's intention but that, in that case, the inclusion of those words would limit the freedom of the Government.
In this situation, as I read Clause 17(2)(a), these amendments are being inserted after the statement that the purpose of any criminal investigation must be to counter terrorism or must involve terrorism, to use the words of the noble Lord, Lord Thomas. Surely that gives the Government all the latitude that they need. The criminal investigation itself must be dedicated towards a counter-terrorism purpose, as is already stated in Clause 17(2)(a). But if, for example, another investigation which was not terrorism-based suddenly threw up information about terrorism, presumably at that stage there would be a fresh investigation which would be dedicated towards counter-terrorism.
Therefore, I believe that a number of noble Lords would be interested in listening to the Minister if he said that the word "counter-terrorism" was in some way not broad enough. As I suggested earlier this evening, the act might, for example, be a terrorist threat or a threat to national security, however broadly
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the Minister wishes to draw the phrase. However, to leave the matter totally open appears to question the Government's statement that the aim of the Bill is purely to counter terrorism. I believe that this provides a very good opportunity for the Minister to confirm whether that is still the case or whether the Government wish the Bill to be applied more widely to issues that have nothing whatever to do with terrorism.
Lord McIntosh of Haringey: As has already been said, the arguments here, which are central to Clause 17, were visited when we dealt with previous amendments. I shall be required—indeed, I shall require myself—to give the same answers as I gave on previous occasions. I shall have something very specific to say about the General Medical Council, and one or two new points have been made to which I also want to respond.
However, fundamentally, I want to explain again what we are trying to achieve in Part 3 and. in particular, in Clause 17. The provisions of Part 3 are designed to clarify to public authorities whether or not they may disclose information. Restricting their disclosure solely to cases of terrorist offences would be a significant impediment to them. In each case it would force them to satisfy themselves, for fear of acting illegally, that the information was directly related to criminal conduct in relation to terrorism.
I heard the noble Lord, Lord Thomas, make the point that his amendments which use the phrase "involving terrorism" are different. They do not appear to be different but I shall examine the point and consider between now and Report whether there is a significant and helpful difference in wording.
Under the present drafting, individuals need to satisfy themselves that information would be relevant to a criminal investigation or proceedings. The amendments would limit the provisions and render them significantly weaker—and "weaker" is not meant in an abstract sense. It means weakening the pursuit of terrorism. I come back to that point time and again.
The Earl of Onslow: The Minister started by arguing that we can go looking for any criminal but then said, "If we cannot do that, it works against our ability to act against terrorism". That is a logical inconsistency of the first order. Either one is looking for terrorism or one is looking for offences such as parking on double yellow lines or brothel-keeping. There is no point in saying, "Yes, we are going to look for brothel-keeping", and hope that by accident we shall uncover terrorism. The Bill should not allow one to go trawling for brothel-keepers. Let us by all means pass an Act that allows us to go trawling for brothel-keepers but let us restrict the terrorism Bill to terrorist offences. That is the point that those of us on this side have been hammering home. The Minister argued that we can start with other offences and that accidentally we shall come on to terrorism. That cannot be the right approach and it is not what the Bill should do.
Lord McIntosh of Haringey: I disagree with the noble Earl on a point of logic, quite apart from his

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argument about terrorism. When the anti-terrorist squad, for example, or any other body is looking for terrorism, they are looking for activities that one can discover but which may not themselves be terrorist activities. Those activities involve other criminal activities that could lead one to terrorists. There is no alternative way to start an investigation involving terrorism other than by looking more widely.
Viscount Goschen: The Minister is being extraordinarily patient and I apologise for intervening again, but I am not sure that he is right. Clause 17(2)(a) states that the purpose of the investigation has to be to counter terrorism. My noble friend Lord Onslow pointed out that the Minister said that the investigation could be into anything. The Minister's argument is rather like suggesting that one should be given the authority to intercept all telephone calls on the off-chance that something criminal might be said. The authority has to be satisfied only about the purpose of the investigation, not that every little piece of information is definitely terrorist related. It has to be satisfied about the situation in which a person comes to it and says, "I am a counter-terrorism officer"—or an officer of the security services, for example—"and my intention in asking for the information is to pursue terrorism". That does not involve asking the authority to judge whether that piece of information is terrorism-related or not; nor does it involve conclusions about the way in which the original inquiry came about.
Lord McIntosh of Haringey: I do not know how the noble Viscount can avoid asking the authority to judge whether terrorism is being searched for or not, because its ability to disclose information depends on whether the approach falls within the scope of the clause. That is why it is not enough for me to have a flash on my shoulder saying, "anti-terrorist squad" and it is not enough to say that the offence that I am seeking to uncover is a terrorist offence. All sorts of other offences are—to use the jargon—the gateways to terrorism. Those who are looking for terrorists have to go through other routes in order to discover those terrorists.
I have accepted interruptions, which I do not resent in any way, but I want to finish my earlier argument about why the matter can become so difficult. We cannot separate the matter from what public officials are able to disclose or the need for them not to be restricted in what they are able to disclose. Let us consider, for example, overseas investigations. How will public officials assess whether such investigations relate to terrorist offences? The amendments would prevent those officials from disclosing where they could not satisfy themselves that overseas investigations were being carried out as part of terrorist investigations.
We are talking about the ability to disclose, not about what they are told. Serious criminal offences, such as drug dealing and money laundering, are often fundamentally bound up with terrorism. It is
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important that public officials are able to disclose information related to those offences in order to assist in the fight against terrorism.
Lord Phillips of Sudbury: I thank the Minister for giving way. Does he not appreciate that these dilemmas, the boundaries and definitions of statutory entitlements and duties, are the everyday experience of magistrates, judges and police? If he had permitted the introduction of the authorisation procedure that we pressed on the Government half an hour ago, the problems of which he is making a chimera would not be there at all.
Lord McIntosh of Haringey: I shall ask the noble Lord a question in return, which I shall try to make rhetorical. Is the noble Lord, Lord Phillips, not aware that all of the problems which he and everyone else are introducing into this legislation are ones which exist with existing legislation? All of these powers of disclosure exist for criminal proceedings. What is happening here is that they are being extended to criminal investigations. What on earth is wrong with that? It is in the early stages of catching terrorists that we need this power of disclosure. That is the change in this part of the Bill.
The Earl of Onslow: I shall answer the question the Minister asks. What is wrong is that this is emergency legislation concerning terrorism, not general legislation concerning criminality. That is the exact answer. It is not a chimera, which I believe is a Greek image which vanishes. The noble Earl, Lord Russell, is not in his place. He would certainly tell me if that is right. That is the difference. That is the point on which those of us on this side of the House take a different line to the noble Lord, who is doing his level best. I do not think that it is good enough. He is doing the best he can. That is the argument which we are trying to get through to him.
Lord McIntosh of Haringey: If the objection is so fundamental, why did not the noble Earl, Lord Onslow, vote against Second Reading? Why does he not vote against Third Reading instead of bringing this up at every single point on every single amendment? If the objection is as fundamental as that and impervious to the argument we put forward on the amendments before the Committee, there is nothing else I can do to persuade him. I shall try to finish my argument as quickly as I can.
In practical terms the criteria set out in Part 2, with which we have already dealt, provide a clearer basis for action than terrorism, which allows for a more subjective interpretation. The noble Lord, Lord Phillips, asks for wider consultation and further consideration. Frankly, that is a delaying tactic. This is not an issue which merits or justifies delay. We are two-and-a-half months away from the worst terrorist attack which has taken place in the western world within a century. Historians would go further back. We have to respond in a timely way. We see investigations take place in Spain, Belgium, Britain,

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the United States, and all over the world. Are we to be the one country in the world which does not have the powers to pursue those investigations properly? I find it inconceivable that that is what noble Lords would wish to do.
I turn briefly to the General Medical Council. Under the Health Act 1999 and health legislation there is some information held by the health service which fulfils the qualifications in this legislation. In other words, it is covered by the existing statutory restrictions on disclosure and is information collected under the statutory powers. It is true that under certain circumstances under statutory powers the Audit Commission can demand certain patient records. However, I understand that they are demanded in statistical form rather than that which is identifiable to individual patients. To the very limited extent that health information is collected under statutory powers it is covered by this legislation. It does not cover doctors. Whatever may be the case for other purposes, I give the assurance that doctors are not public officials for this purpose. The information that they hold on medical records is not covered.
At present individual patient records can be disclosed if they are required for criminal proceedings. The noble Baroness, Lady Buscombe, fairly read out the ruling of the General Medical Council about what can be disclosed for serious crime. She defined that clearly. Terrorism is a serious crime. The GMC's agreement and the ethical standards that it applies to medical staff will he extended from criminal proceedings, which it accepts at the moment, to criminal investigations.
If there is some doubt about the role of the Audit Commission's work we shall look at that between now and later stages of the Bill. Even in the event of medical records in the hands of the Audit Commission becoming subject to one of the statutory restrictions which we are modifying, that does not necessarily mean that disclosure will be permitted. The Data Protection Act, the Human Rights Act and the duty of confidence will apply. If the information in question is confidential then disclosure will be difficult. This is not a question of the police coming and asking for records and trawling for whatever they want to know even if they do not know what they want to know.
Lord Phillips of Sudbury: I thank the Minister for giving way. How on earth can the Minister make that assertion? He has no control over the police. The police on occasions do things that they should not. They have obsessions that they should not have. How can he say that?
Lord McIntosh of Haringey: That is an extraordinary question. The police have statutory duties for the pursuit of crime. The fact that I have described the limitations on what the police can do does not mean to say that there are not those who break the law, which is what the noble Lord, Lord Phillips, is suggesting.
Lord Phillips of Sudbury: That is my very point. It would not involve a breakage of the law because these powers are so wide that unscrupulous or ill-advised or unwise use of them could be permissible under the legislation, which is what we are trying to prevent.
Lord McIntosh of Haringey: I have risked—if not worse than that—wearying the House by repeating the substantial constraints that there are, both legal and in the drafting of the legislation. We land up with the position where the noble Lord, Lord Phillips, does not believe me. There is not very much that I can do about that. I have stated the position. I hope that I have given the noble Baroness, Lady Buscombe, the assurance that she sought. I know that I have not convinced those who want to restrict the whole of this part of the Bill in this way. But I put it to them that the greater good of the international pursuit of terrorism and our participation in that deserves some consideration.
Lord Thomas of Gresford: There are very few constraints in the way that this clause is drafted. It is drafted in the widest possible terms. However, I am very grateful to the Minister for his saying that over the next few days before we come to Report stage he will consider the expression that I have used in my amendment which involves terrorism.
Lord McIntosh of Haringey: I do not think that the noble Lord, Lord Thomas, was here before dinner. When speaking to Amendment No. 48A I set out precisely the very extensive constraints on the clause and the way in which it has been written as represented in public. I suggest that before commenting further the noble Lord reads Hansard.
Lord Thomas of Gresford: I think that I was here—I referred to it as the Grand National course that the Minister will require. In answer to my point, the Minister said that it will not be enough for a person to have a flash on his shoulder reading "anti-terrorist squad" or to say to a person from whom he is demanding information, "I am investigating terrorism". Yet of course any person who goes to an authority for such information must demonstrate that he has a right to that information. As the Bill is drafted and as the current provisions for criminal proceedings—
Lord McIntosh of Haringey: He has the right to ask for that information. That is the only right that he has and unless he does it convincingly he will not get it.
Lord Thomas of Gresford: Exactly, he must establish that he is a police officer, for example by showing a flash on his shoulder, by producing his warrant card or by demonstrating that he is investigating a crime. It is only one step further for him to say, "The crime that I am investigating involves terrorism. That is my interest. That is my duty. That is why I want the information that you can provide". I hope that the Minister will consider that when he considers the wording of my amendment.
Lord Hylton: While the Minister considers that, I return him to my point about overseas. Clause 17(2)(a) and (b) both refer to criminal investigations and proceedings,
"in the United Kingdom or elsewhere".
Given that, I hope that the Minister can give me the assurance that I sought. He may say that my worries are covered by Clause 18, but it is written in such convoluted language that I have great difficulty understanding it. Can the Minister explain it or produce any other reason to allay my concern?
Lord McIntosh of Haringey: I think that I had better write to the noble Lord on that subject.
Baroness Buscombe: I thank the Minister for his full and robust response to this group of amendments. As my noble friend Lord Goschen said, it crystallises the nub of our concern, which is that the gateway is too wide. In the brief time that we have had to consider the implications of the Bill, we have encountered significant opposition to it. We do not want to weaken the pursuit of terrorism—there is no question of that. All that we want is to limit the Bill to say that the purpose of the investigation should at the outset be the genuine pursuit of terrorism. I again thank my noble friend Lord Goschen for making that point.
We want to ensure that authorities can pursue investigations properly but in a way that means that they are genuinely limited to terrorism. Whether they turn out to be successful pursuits of terrorism is another matter, but terrorism should be in the minds of those authorities when they set out in their task to require the disclosure of information.
I thank the Minister for his assurance when he said that doctors are not public officials. I shall invite the General Medical Council to read tomorrow in Hansard what the Minister said. I also thank him for his reassurance that if there is any doubt—and we have doubts about the role of the Audit Commission—he will consider the matter further before we, in a sense, say goodbye to the Bill in the coming days.
There are several issues relating to Clause 17 that we shall want to pursue, but, for our part, we shall endeavour to be brief, because we shall want to return to them on Report. On that basis, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 50A to 55 not moved.]
Lord Phillips of Sudbury Lord Phillips of Sudbury moved Amendment No. 56:
Page 7, line 16, leave out paragraph (d).
The noble Lord said: This amendment and Amendment No.80 seek to exclude paragraph (d) from Clause 17(2) and paragraph (e) from Clause 19(2). The paragraph concerned refers to,
"the purpose of facilitating a determination of whether any such investigation or proceedings should be initiated or brought to an end".
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It is apparent to the Minister that everyone in the Chamber bar the Government Front Bench believes that that entitlement to disclosure is far too wide. It means that an individual or body can engage in a pre-review of whether he wants to begin an investigation which may give rise to proceedings. We believe that that is far too wide and it serves no useful purpose. Given everything that has been said, I beg to move.
Baroness Buscombe: I rise simply to say that I entirely support what was said by the noble Lord, Lord Phillips of Sudbury.
Lord McIntosh of Haringey: I have said almost everything I wanted to say about this amendment when speaking to other amendments. If the power of disclosure is to have any effect, it must have effect when the suspicion first arises. I am not so much concerned with the provision of the initiation of an investigation because if I were to ask for disclosure of information I would merely say, "Yes, I have started the investigation. I started five minutes ago. Can you help me?" I do not believe that that is the problem.
The reason that we need the provision is for bringing to an end any investigation of proceedings. It will allow the authorities to clear an individual's name by providing information which shows he is innocent and allows the investigation to be closed. It will also be able to help the police to determine whether an investigation should start by providing information on an individual thought to have left the country or thought to be dead.
Both of those circumstances seem to me to be entirely inoffensive. The first could easily be overcome if the provision were not made, but the ability to use it to clear someone's name seems to me to be extremely valuable.
Lord Hylton: I note that subsections (2)(c) and (2)(d) do not include the words "in the UK or elsewhere". Nevertheless, I suspect that that phrase may be read into them. If it is capable of being read into them, it reinforces what I said earlier in the debate on the clause about disclosure to overseas countries.
Lord McIntosh of Haringey: They refer to "such investigation or proceedings", which relates back to subsections (2)(a) and (2)(b). Therefore, it means the United Kingdom and elsewhere.
I believe that I can set at rest the mind of the noble Lord, Lord Hylton, because there is no question of information being disclosed to those abroad who would misuse it. He gave the example of eastern Europe, but probably there are better examples. However, I shall write to the noble Lord giving all the details of the constraints which make it impossible under the legislation for information to be passed to those who would misuse it in the way he fears.
Lord Phillips of Sudbury: I should love to have a clear example of a non-terrorist case which falls within paragraph (d) because it would represent 99.99 per cent of the cases within that provision. I should like a

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clear example to show why the Government believe that only paragraph (d) provides the kind of protection that is needed for non-terrorist offences. However, I shall not have such an example, and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Buscombe Baroness Buscombe moved Amendment No. 57:
Page 7, line 17, at end insert—
"() Information to which subsection (2) applies shall not be disclosed by the public authority until such time as that public authority has undertaken a pre-disclosure assessment of the request for information and it has been shown by the requester—

(a) that there are reasonable grounds for suspecting that the information in question would be relevant to an inquiry into terrorist activity;

(b) that the data subject has committed an offence related to terrorism; or

(c) that the request to disclose information on a particular individual is proportionate in the context of the offence in question."

The noble Baroness said: In rising to move Amendment No. 57, I shall speak also to Amendments Nos. 64 and 88. The purpose of these amendments is to add appropriate safeguards to the provisions. We shall try again. Clause 17 provides that information obtained by a very wide range of public authorities under a vast array of legislative provisions listed in Schedule 4 would be capable of being disclosed for the purpose of a criminal investigation into, or criminal proceedings for, any offence in the United Kingdom or elsewhere, or for the purpose of,
"facilitating a determination of whether any such investigation or proceedings should be initiated or brought to an end".
The clauses in Part 3 are identical to those in Part 2 of the Criminal Justice and Police Act which came into force earlier this year. The Joint Committee on Human Rights has considered the provisions of the current Bill. In its report published on 14th November 2001 the committee referred to its earlier criticisms of provisions in the Criminal Justice and Police Bill. In particular it concluded that,
"There is a need to introduce adequate safeguards into this legislation. Consideration should be given to amending these provisions to include … a requirement that there should be reasonable grounds for suspecting that the information in question would be relevant to a criminal inquiry or that the data subject has committed an offence, and a requirement that a pre-disclosure assessment be made of the proportionality of disclosing information on a particular individual in the context of the offence in question.
"Consideration should also be given to limiting the very wide power to make disclosures 'for the purposes of initiating … any such investigation or proceedings'. We draw the attention of each House to these provisions, and consider that necessary safeguards should be provided to ensure they are compatible with the right to privacy".
It is our view that the provisions as drafted are much wider than is necessary for the prevention of terrorism. We wholeheartedly endorse the views of the Joint Committee in pressing for the need for appropriate safeguards to be included in the provisions. Clause 17(2) relates to the disclosure of information by or on behalf of a public authority. The definition of "public
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authority" in Clause 20(1) is by reference to Section 6 of the Human Rights Act 1998 which is in very wide terms and includes courts, tribunals and,
"any person certain of whose functions are of a public nature".
When the Joint Committee considered the provisions in the Criminal Justice and Police Bill it heard evidence from Mr Hartnett who said:
"we have described a 'public authority' as that which has the same meaning … as in Section 6 of the Human Rights Act. So we feel that that not only deals with the specific point about disclosure, but the fact that we have anchored this … to Section 6 or the Human Rights Act means that any disclosure that a public authority makes must be compatible with Article 8 of the convention … and thereby it has to meet the tests of reasonableness and proportionality which we understand the committee was concerned about in January".
However, it cannot be assumed that the Bill will he interpreted in such a way that disclosure will be compatible with Article 8 of the convention. By including a clause which makes express provision for tests of reasonableness and proportionality means that there can be no doubt that Article 8 should be complied with. The fact that there may be a need for this anti-terrorism legislation to enter the statute books fairly quickly is not an excuse to sacrifice certainty. I beg to move.
10 p.m.
The Earl of Northesk: I support the amendment. I agree with every word of my noble friend's introduction of this group of amendments, specifically in regard to the human rights issue. However, I should like to add a few thoughts of my own.
I know that the Minister is not entirely in concurrence with my view on this point, but. I repeat, my concern is that Part 3—particularly when taken in tandem with Part 11—represents carte blanche for data matching and/or data sharing throughout the machinery of government. The worth of the amendments is in limiting the scope for the use of such techniques to matters relating solely to terrorist activity as well as subjecting them to a proportionality test. In this way we could perhaps be assured that there will continue to be a presumption that authority for the future application of such measures will be on a case-by-case basis via primary legislation. At the very least, as my noble friend suggested, that will deliver greater consistency with the ECHR.
There is a subsidiary issue, albeit one of important significance. I refer to some of the concerns that were inadequately debated in the context of the Criminal Justice and Police Bill during the previous Session. As far as I am aware, the existing statutory disclosure provisions as they relate to the Revenue authorities, while limited in scope—I accept that—have operated well, striking the right balance between the rights of the individual, the requirements of the state and the public interest. Part 3 is a fundamental departure from the principles upon which this regime is based; namely, that information disclosed to tax authorities for tax purposes should be used only for tax purposes.
I can understand the desirability of disclosure, particularly in terms of the terrorist threat, but, none the less, its potential for undermining the successful

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operation of the existing regime, especially the so called Hansard procedure, was a principled objection to Part 2 of the Criminal Justice and Police Bill in the previous Session. It is even more of an objection in the face of the drafting before us today.
To get back to the point, the Minister will not be surprised to hear me say that the situation is exacerbated because of the vast scope for data matching when cross-referenced with Part 11. By imposing the test of proportionality and limiting the scope of the disclosure regime to terrorist activity, the amendments go at least some way towards addressing the problem.
I would add one other thought. The Bill has been severely criticised for the way in which it introduces elements of, as it were, non-emergency legislation. Necessarily, this suggests a less than adequate process of consultation. This is becoming a matter of particular anxiety for the financial services sector in respect of this part of the Bill. I very much hope that the Minister does not underestimate how deeply harmful these provisions could be if they are enacted as they stand. The amendment is justified on this basis alone as it would ensure that a wider and more appropriate disclosure regime could be developed, with appropriate consultation and in a less hurried way.
I do not gainsay in any way the Government's purpose in bearing down on the financial aspects of terrorism. Nor do I mean to be alarmist. But to take risks with the pre-eminence of the City—and the position could be that serious—by legislating too broadly and quickly would, I suggest, be both unwise and unreasonable. As I said, I support the amendment.
Lord McIntosh of Haringey: I think—and I hope—that there is a profound misunderstanding and that we are not as far apart as may at first appear.
The noble Baroness, Lady Buscombe, quoted the Joint Committee of January this year. But, of course, the Joint Committee was referring to the Criminal Justice and Police Bill as it was before the House prior to the election. Most of that Bill disappeared during the wash-up; it was abandoned because there was still disagreement about it. However, the important issue is that there are huge differences between the proposals in the Criminal Justice and Police Bill and what is provided in this Bill.
The Joint Committee recommended in January of this year in regard to the Criminal Justice and Police Bill that, inter alia, there should be a pre-disclosure proportionality test which would oblige the individual disclosing the information to assess the proportionality of disclosing information in the context of the offence in question; that there should be a time limit placed on the grounds on which information should be disclosed—specifically, as they stand in this Bill, at Clause 17(2)(c) and (d); and that Clause 19(2)(c) and (d) should be narrowed.
Since then, we have provided on the face of the Bill that only public authorities can disclose. That covers
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all of these points. It means that the Data Protection Act and the Human Rights Act apply to all of these disclosures. That, in turn, means that the recommendations of the Joint Committee—for example, on proportionality—are available here. It is necessary to look at the difference between the pre-election Bill and this Bill in order to understand the extent to which we have taken into account all of the recommendations of the Joint Committee.
Baroness Buscombe: I must apologise to the Minister. I have been a bit slow on the uptake. While I was saying that it is our view that Part 3 of the Bill is identical to Part 2 of last year's Criminal Justice and Police Bill, I was actually quoting from the report by the Joint Committee on Human Rights which was published on 14th November.
Lord McIntosh of Haringey: I am grateful for that. If it means that I have to think about something that I have said, I shall certainly do so. The differences between this Bill and the previous one certainly are of huge significance.
The amendment is complicated. Perhaps I may make three points. First, the amendment is framed in terms of public authorities facing requests for information. While it may be the case that such requests are made, the intention is to allow bodies to volunteer information where this would be helpful in preventing or investigating crime, without having to be asked for it first. It will be for the body holding the information to decide whether to disclose it. There is no element of compulsion or obligation on the public authority to disclose.
Secondly, the Human Rights Act already obliges any public authority to consider, before disclosing, whether disclosure is proportionate. We have provided that the disclosures under Clause 17 will only be from public authorities, so that the Human Rights Act, unlike the Criminal Justice and Police Bill, applies to all of these disclosures.
The third point relates to the problem of restricting the disclosures to terrorist offences. We have gone over that ground and I shall not weary the Committee again. I must repeat, however, that in cases where a criminal investigation is in its early stages it may not be clear that a terrorist offence has been committed or that the investigation will become a terrorist investigation. In such cases, if the amendment were accepted officials would not be able to disclose potentially vital information.
The rest of the arguments used in relation to the amendment are ones to which I responded during debates on previous amendments. I hope that the amendment will not be pressed.
Baroness Buscombe: I thank the Minister for his response. Again, I apologise for my rather late intervention, which was not particularly helpful.
I shall be brief. The Minister said that the amendment is complicated in three ways. Perhaps we should re-think our drafting. I shall consider his

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remarks with care—although I should forewarn him that my initial response is that we cannot agree with what he has said. However, we should like to read his remarks in Hansard. On that basis, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 58 and 59 not moved.]
Baroness Buscombe Baroness Buscombe moved Amendment No. 60:
Page 7, line 18, after "may" insert ", after consultation with the Scottish Ministers."
The noble Baroness said: Again, I shall be brief. In moving this amendment, I shall speak also to Amendment No. 61, which is a Liberal Democrat amendment, and to my Amendment No. 66.
Amendments Nos. 60 and 66 are probing amendments. They relate to one of the provisions in the Bill which impact on an area of devolved competence, criminal law and procedure. To take full account of the devolution settlement, we have been asked by the Law Society of Scotland to recommend that provision is made on the face of the Bill for consultation with Scottish Ministers prior to an order being issued by the Treasury.
We entirely support Amendment No. 61 tabled by the Liberal Democrats. I beg to move.
Lord Goodhart: Amendment No. 61 stands in my name and that of my noble friends Lord McNally and Lord Thomas of Gresford. Clause 17(3) states:
"The Treasury may by order made by statutory instrument add any provision contained in any subordinate legislation to the provisions to which this section applies".
It can add by order any secondary legislation to the 53 statutes set out in Schedule 4. Under Clause 17(4) that statutory instrument is subject to the negative resolution procedure.
Amendment No. 61 gives effect to a recommendation of the Delegated Powers and Regulatory Reform Committee that the Committee should consider converting that from the negative to the affirmative resolution procedure. That is what Amendment No. 61 provides. I understand from something that the Minister said earlier that the Government may he minded to accept that. If so, I need say nothing further.
The Earl of Mar and Kellie: I have put my name to Amendments Nos. 60 and 66. I hope that the Minister's response to these amendments will be that there was a simple omission; and that the devolution settlement devolved criminal law and criminal procedure in Scotland. While I accept that Parliament reserved to itself the power to override the Scottish Parliament and therefore does not need to consult Scottish Ministers, I believe that that would be bad politics. Accepting the amendments would be good politics.
Lord McIntosh of Haringey: As the noble Lord, Lord Goodhart, anticipated, I can confirm that we shall follow our usual practice of bowing down before
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the Delegated Powers and Regulatory Reform Committee. We shall produce amendments to provide for the affirmative resolution procedure.
I think that the noble Earl is trying it on a little with Amendments Nos. 60 and 66. If on every occasion that secondary legislation involved devolved administrations we had to put into the legislation that we shall consult the Scottish Ministers we would have a substantial increase in the size and scope of legislation and more Scottish forests would fall as a result. Of course, we shall consult with Scottish Ministers but we do not have to say so. We have a Sewell memorandum on this Bill. All the primary legislation has been agreed by the then Acting First Minister as appropriate to be applied to Scotland It is hardly conceivable that when we come to secondary legislation we should face these difficulties.
The Earl of Mar and Kellie: My one complaint about the use of a Sewell Motion procedure is this. No doubt the Minister of Justice approved the Bill when it was published. The Scottish Parliament does not have the chance to see the Bill until after it has become an Act during the process of which it may have been modified.
Lord McIntosh of Haringey: It was agreed not to debate it. It will have the chance to see it and we shall discuss all the subordinate legislation with Scottish Ministers. We do not need to put that on the face of the Bill.
Baroness Buscombe: I thank the Minister for his response and accept what he has said. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 61 not moved.]
10.15 p.m.
Baroness Buscombe Baroness Buscombe moved Amendment No. 62:
Page 7, line 25, at end insert—
"() Nothing in this section shall authorise the disclosure of information which is subject to legal privilege.
() For the purposes of this Part, information is subject to legal privilege if it forms part of communications made in connection with, or in contemplation of, legal proceedings and for the purposes of these proceedings being communications which would in legal proceedings be protected from disclosure by virtue of any rule of law relating to the confidentiality of communications."
The noble Baroness said: The amendment relates to legal privilege. I shall be very brief. The remarks of the noble Lord, Lord Brennan, on the principle of legal privilege during the Second Reading debate on the Criminal Justice and Police Bill in April this year are relevant here. He said:
"Legal professional privilege enjoys its historical importance in our criminal and civil law because it protects the citizen against unreasonable interference by the state. Citizens can talk to their lawyer in private and by so doing protect their human rights and protect their desire to prove their innocence if charged, if they can. In the view of many, that is still a vital part of our democracy. It distinguishes us from a totalitarian state where such concepts are regarded as irrelevant. It is an important feature of our legal life

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and of our system of human rights as we now have them and it should not be damaged or diminished without the most careful consideration".
I hope that the noble Lord, Lord Brennan, will not mind if I quote from him a little further. He went on:
"In an age of electronic records, I find it difficult to accept that the Bill will allow the seizure of electronic material by people who have no idea what they are doing in terms of distinguishing between what is privileged and what is not. Once obtained, even with an obligation to return it as soon as possible if it is privileged, are we really to think that the information obtained by the police if it is privileged will not be stored, at least mentally if not in some permanent form? I find that extremely concerning. It could give rise to a state of affairs whereby, at one extreme, lawyers do not record their advice and, at another, they encrypt their communications with their client or their records of them".—[Official Report, 2/4/01; col. 684.]
That entirely supports the concerns expressed earlier this evening by my noble friend Lord Kingsland. I beg to move.
The Earl of Mar and Kellie: The Law Society of Scotland suggested the amendment to us. I shall restrict my remarks to the simple point that not including the amendment will lead to ambiguity, whereas including it would prevent that. That is particularly important when so much in the Bill is rightly being done behind the backs of suspected terrorists. The public need to know where we stand on the issue.
Lord Phillips of Sudbury: We strongly support the amendment. People dislike bestowing statutory privileges on lawyers, but this is one privilege that is for the benefit of people.
Lord McIntosh of Haringey: The Committee is not going to catch me disagreeing with the noble Lord, Lord Brennan, about legal professional privilege. However, the relevant Acts in Schedule 4 already contain provisions that prevent people being compelled to produce information that is subject to legal professional privilege. Nothing in the Bill will extend those duties or possibilities. It is very unlikely that information that is subject to legal professional privilege will be obtained under the provision listed in the schedule. Information subject to legal professional privilege will certainly not be obtained by compulsion under the existing enactments. Only information that is required by statute is covered.
Although the amendment has such distinguished provenance, it is misconceived. This part of the Bill deals with the disclosure of information, not the obtaining of information. There are already protections in place to ensure that information that is subject to LPP is not obtained under the listed enactments.
There is a possibility that the information could be provided to a public authority voluntarily. It could then be disclosable under the new gateways. But it would still be necessary to consider the other restrictions such as confidentiality. If a person discloses legal advice to a third party in confidence, that duty of confidence would still prevent disclosure
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even if the new gateway applied. We support the thinking behind the amendment, but I hope that it will be recognised that it is not necessary.
Baroness Buscombe: I thank the Minister for his response. The amendment may appear misconceived but it is there for a purpose. Our purpose has been achieved, which was to obtain the Minister's reassurance. On that basis, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 63 to 65 not moved.]
On Question, Whether Clause 17 shall stand part of the Bill?
Lord Phillips of Sudbury: We have had a long and at times arduous debate on Clause 17, but disclosure is at the heart of the Bill. The clause has the widest ramifications. Those of us who view it as too wide are unhappy at the outcome of tonight's debate. I am also tempted to reflect again on the fact that not a single speaker—beyond the Ministers involved—has defended the clause as it stands.
The Minister has admitted that it provides a huge extension of rights of disclosure. There is no doubt that a public authority to which a request for disclosure is made under Clause 17 will be unable to refuse it without good reason. That would be a judicially reviewable decision. The Minister is indicating that that is not true, but a public authority to which a request for disclosure was properly made under Clause 17 could not simply refuse to comply. It would be a reviewable decision according to Wednesbury principles and it represents a right on the part of those requesting the disclosure.
The provision is not confined to terrorism, which is the purpose of the Bill; it is not confined to UK offences; it is not confined to serious offences; and, it is not confined to disclosure by government departments and state bodies. It extends to public authorities—hybrid authorities, in particular, so a vast array of organisations will be subject to the measure.
It is not confined to disclosure to public authorities. The Minister has confirmed tonight that individuals carrying on private prosecutions will be able to use Clause 17 along with authorities. It will also—this was a surprise—extend to all those who are accused in respect of private or public prosecutions. Therefore, a vast new array of potential users of the clause come into view.
It will not be confined to individuals in this country but includes individuals abroad. It will not be limited to reasonable, relevant or proportionate requests for disclosure. On all that, the Minister says that there is the Human Rights Act, which, as everybody knows, will be an unreachable remedy for the vast majority of people.
Clause 17 and the extended powers it gives are not confined just to the 66 statutes in Schedule 4—they can be added to; they are not confined to requests for disclosure from abroad only where there are comparable legal rights and protections for UK

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citizens; they are not confined to requests for disclosure from abroad only where there is a comparable integrity of the administration and application of those foreign laws; and they are not even confined to requests for disclosure in connection with actual prosecutions or investigations. As we know, paragraph (d), as it currently stands, will allow a far wider disclosure than that.
Not at any point are any of these disclosure arrangements subject to the say-so of a magistrate or a judge, not even to a warrant. Attention was drawn to the vastly different regime under the RIPA Act which does indeed provide the sort of protections we sought in the amendment on authorisation. There is nothing here except the dim and expensive prospect of legal proceedings by way of judicial review or under the Human Rights Act. And it relates not only to future effect; it also relates to retrospective facts—those already in the kitty, so to speak.
All in all, we feel that this clause disfigures an already problematic Bill. It is offensive to our traditions and to the real but limited needs giving rise to it, and indeed to common sense. It is condemned by Liberty, Justice, the Law Society, the Bar Council, the BMA and the General Medical Council. We have all been showered with representations soberly made by sober organisations which fear for the extent of this measure.
Finally, there is no sunset provision in the legislation. If it was truly a measure that related to terrorism, a sunset clause would be added here as it has been added elsewhere in the Bill.
I do not intend to reiterate what I said less than 24 hours ago at Second Reading on the background to this. But we believe strongly—I think I can speak for both Benches on this side of the Chamber—that it should be withdrawn and resubmitted in a fair and sensible form. At this hour of the night I do not intend to press for a vote.
Baroness Buscombe: I rise simply to support the words of the noble Lord, Lord Phillips of Sudbury. I hope that we can pursue some of these areas further outside the Chamber between now and Report stage.
Lord McIntosh of Haringey: I believe I have responded to virtually all the points made by the noble Lord, Lord Phillips, in the deliberate statement that I made on Amendment No. 48A before we broke for dinner. The only new element in what he said is to say that there would in effect be an obligation on public authorities to disclose.
That is simply untrue. Nothing is provided either here or anywhere else which forces public officials or public authorities to disclose any information. What is given in this clause is the power to give information. I have already described the safeguards in place. I have already commented on the fact that a large amount of public debate on this issue has been on the basis of serious misconceptions about the provision.
Lord Goodhart: Does the Minister agree that since the authorisation means that the officers of a public
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authority are exercising a public function in deciding whether or not to agree to a request for information, their decision would in fact be reviewable by a court and therefore they would be bound to act reasonably in deciding whether to give the information? If they were acting unreasonably in refusing it, they could be ordered to give it.
10.30 p.m.
The Earl of Onslow: This has been quite a depressing debate. It has reminded me of my grandmother. When she became engaged to be married, my grandfather said to her, "Marriage is a question of give and take" to which she replied, "You give and I take".
In my view the arguments on this side of the Committee have been overwhelming, not just because I have tried to advance some of them. I sincerely hope that if I can be persuaded by an argument on the other side, I will be. I was. I was very influenced by what the noble Lord, Lord McIntosh, said as regards the first amendment. He said in relation to it that the magistrates are quite capable of dealing with the question of drug money confiscation and that they had done so for 10 years. So I was influenced by what he said. In other words, I was prepared to listen to what he said.
The impression I have is that, however good the argument on this side, the noble Lord has been given instructions to resist, resist and resist. None of us is arguing in any way that terrorism should not he defeated as quickly and efficaciously as possible. The noble Lord suggested that I should divide the House the whole time. He would not like me to carry out his instructions. There are 185 amendments. That figure, multiplied by 20 minutes, is something in the region of 90 hours of parliamentary time, which I suspect takes us beyond next Easter or something like that. I am sure that that is not part of the Government's programme.
All I am saying is that in my view the arguments have been overwhelming. They have been resisted with charm and great ability by the noble Lord. But he has not convinced one single Member of his own Back Benches to speak in his support. He is unable, however much he has tried, to counter the arguments put brilliantly by the noble Lord, Lord Phillips. Some of us have tried to chip in as well. It is very depressing when one hears intelligent people producing intelligent arguments, not just for "yah boo" sakes, being resisted and resisted. That is all I have to say tonight and I am now going home to bed.
Lord McIntosh of Haringey: I did not say to the noble Earl, Lord Onslow, that he should divide the House on every amendment. I said that he is irreconcilable and there is nothing that we can do about meeting his requirements. He should have divided the House at Second Reading and he can still do so at Third Reading. It is not about the detail.
I have huge affection for the noble Earl and it is permanent. I have had it ever since he opposed the poll tax on the grounds that it was unfair that he and his head game keeper should pay the same local tax. That

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will never go away. The affection and admiration that I have for him over that will never disappear. But he is irreconcilable. He does not want any part of this Bill. The only proper thing to do is to vote against it as a whole and not on every single amendment.
I respond only to the single new point that was made; namely, the possibility of a refusal to disclose on request being reviewed. In theory that is the case and it is possible. But how would it succeed? The public authority does not have, and is not given, a duty to disclose. It is only in the unlikely circumstances that it could be said that a public authority was unreasonable—and unreasonable, as the noble Lord, Lord Phillips, said himself in the Wednesbury sense—in refusing to disclose that there could be any question about it. It is a power and not a duty. I am sorry if I am being repetitive, but the public authority will be subject to the Human Rights Act and the Data Protection Act. The Human Rights Act does not require somebody else to pursue the public authority to secure that the human rights provisions are complied with. It is a duty on every public authority to comply with that Act. It would be an offence not to do so.
I conclude as I believe that we can bring this matter to an end. We believe that Clause 17 with the restrictions that I have set out—which have been so widely misunderstood by the public—is a significant help in combating television.
Noble Lords: Oh!
Lord McIntosh of Haringey: I meant to say terrorism. It is "Newsnight" time; I am sorry.
I have set out the safeguards that are in place. I have made it clear that the measure is aimed at terrorism but that it will help with criminal investigations. I recognise that the responses which have been made to Clause 17 are sincerely felt although I believe them to be misconceived. If there is anything we can do between now and Report to remove misconceptions and to narrow the distance between us, we are, of course, willing to try to do that.
Clause 17 agreed to.
Schedule 4 agreed to.
Clause 18 [Restriction on disclosure of information for overseas purposes]:
[Amendments Nos. 66 to 68 not moved.]
Lord Phillips of Sudbury: Amendment No. 68 seeks to—
Lord McIntosh of Haringey: Amendment No. 68 was discussed with Amendment No. 63.
Lord Hylton: I hope that I may say a few words regarding Amendment No. 68, whether or not it has been moved.
The Chairman of Committees (Lord Tordoff): With respect to the noble Lord, there is no amendment
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before the Committee at the moment. The movers of the amendment say that it has not been moved. If the noble Lord wishes to move it, he is, of course, perfectly entitled so to do.
Lord Hylton Lord Hylton moved Amendment No. 68:
Page 8, line 38, at end insert—
"( ) Nothing in this Part authorises the making of any disclosure to an authority of a country or territory outside the United Kingdom unless the law of that country or territory provides, in relation to the use, retention and disclosure of the information in question, equivalent safeguards to those applicable under the law of the part of the United Kingdom in which the information is held."
The noble Lord said: I move the amendment. I had not read the amendment when I sought to obtain an assurance from the noble Lord, Lord McIntosh, on precisely this subject matter. This amendment expresses more elegantly than I did the kind of thing that I want. I suggest the inclusion of only two words to those who drafted the amendment; that is, to add the words, "and practice" after "the law" in the second line. That would cover the huge discrepancy which exists in many countries between what the law says and what actually happens. I strongly commend the amendment to the Minister although he has kindly offered to write to me. I beg to move.
Lord Phillips of Sudbury: As the noble Lord, Lord Hylton, has got the matter into play, I say briefly that I think his proposal is absolutely right. If foreign public authorities are to have the advantages of our legislation, they must provide comparable protections and that must go beyond mere law to practice because, as we know, the manner in which some judicial processes are carried on in other jurisdictions is not such as would give real protection to our citizens and public authorities.
Lord McIntosh of Haringey: I have given the noble Lord, Lord Hylton, the principal assurance that he sought; namely, that there are severe restrictions in terms of human rights with regard to who outside this country can receive information disclosed under this part of the Bill. However, this particular amendment is about data protection systems. The Data Protection Act already restricts the extent to which information can be disclosed to countries outside the European Economic Area. The significance of that is that data protection legislation is virtually common within the European Economic Area.
Before making disclosure for the purposes of an investigation where no proceedings are immediately in prospect, the data controller must usually ensure that the country has an adequate system of data protection in place. I repeat: an adequate system of data protection. That does not mean a formal law which is then disobeyed. Therefore, I believe that I shall be able to add to the letter which I am writing to the noble Lord, Lord Hylton, and which I shall place in the Library of the House, the assurance that is necessary for Clause 68.
Lord Hylton: I am delighted to find myself in complete agreement with the noble Lord, Lord

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Phillips. I note what the noble Lord, Lord McIntosh, said. Therefore, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 18 agreed to.
Clause 19 [Disclosure of information held by revenue departments]:
[Amendments Nos. 69 and 70 not moved.]
Lord Thomas of Gresford Lord Thomas of Gresford moved Amendment No. 71:
Page 9, line 9, leave out paragraph (a).
The noble Lord said: This amendment deals with an entirely different matter. However, I do not propose to worry the Committee for long because it is essentially a probing amendment. Paragraph (a) of Clause 19(2) refers to disclosure,
"for the purpose of facilitating the carrying out by any of the intelligence services of any of that service's functions".
This is an entirely new provision which did not appear in the Bill that was withdrawn last May. That Bill contained only paragraphs (b), (c), (d) and (e).
Therefore, for some reason, an addition is made to the policy by permitting disclosure of the information held by the commissioners of Inland Revenue and the commissioners of Customs and Excise to the intelligence services for any of their functions—that is, for any purpose whatever. It does not refer to an investigation; it does not refer to criminal proceedings; and it does not refer to the possibility of determining whether there should be an investigation or proceedings. It is the broadest clause in this part of the Bill that one can find. It is linked with Amendment No. 84, which I now appreciate is badly drafted. However, that amendment was consequential only, and I do not intend to refer to it further.
I want to know from the Minister for further consideration on Report why such wide powers are granted and what is the true purpose behind this provision. I beg to move.
Lord McIntosh of Haringey: I confess that I was not aware that this matter was not referred to in the Criminal Justice and Police Bill. I simply looked at the amendment on its merits on the face of this Bill. The amendment seeks to remove from Part 3 the references to the intelligence services. Therefore, it seeks to remove a new statutory gateway which in their view—I am talking about the Security Service, the Secret Intelligence Service and GCHQ; that is what is meant by "intelligence services"—would assist them in their vital function of combating terrorism.
One of the central objectives of the Bill is to assist the Government in combating terrorism. If vital information cannot be passed to the security services or, as the Bill states, the intelligence services, that would represent a serious impediment to that effort. I understand the concerns that the noble Lord, Lord Thomas, has in making a comparison with the previous Bill. But I cannot believe, in the specific context of terrorism—even though the noble Earl,
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Lord Onslow, has gone home—that it would be right to exclude reference to the intelligence services from the provisions of the Bill.
10.45 p.m.
Lord Thomas of Gresford: The powers that are being sought are novel and extensive. They mean that the files of all taxpayers in this country will be available for consideration by the security services for any reason whatever. As I have said, the investigation of terrorism need not be involved. Having pondered the matter, I shall return to it.
Lord McIntosh of Haringey: Before the noble Lord concludes, I must say that what he suggested simply is not so. The same restrictions that I described in relation to Clause 17 also apply to Clause 19. Tax records are not held for statutory purposes and therefore cannot be disclosed in the same way. It simply is not the case that the intelligence services can do things outside their own statutory functions. The statutory function of the security services includes the prevention of terrorism and is quite well defined. They cannot simply require any information for any purpose.
Lord Thomas of Gresford: As I understand the position—perhaps the Minister will confirm this—the remit of security and intelligence services has been extended way beyond questions of terrorism and into the investigation of drugs, serious crime and so on. Just how far their remit goes we do not know.
Lord Avebury: People trafficking?
Lord Thomas of Gresford: I hear my noble friend's intervention.
Encapsulated in this provision is a grave extension of principle. I understand that the security services can act only within their statutory framework and I bear in mind what I describe as the Grand National course, which was outlined in relation to Amendment No. 48A. I accept that there is a framework but, within that, the security services control what they like.
Lord McIntosh of Haringey: Tax information is covered by Clause 19.
Lord Thomas of Gresford: The Minister has admitted his first failure of the evening—it is the first time that he has been wrong. We hope that he will accept that he may be wrong in principle in relation to this huge extension of power. I shall not pursue the matter further now but I give notice that I shall pursue it with more information on Report. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 72 to 88 not moved.]
Clause 19 agreed to.

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[Amendment No. 89 not moved.]
Clause 20 [Interpretation of Part 3]:
[Amendments Nos. 90 to 96 not moved.]
Clause 20 agreed to.
On Question, Whether Clause 37 shall stand part of the Bill?
Lord Campbell of Alloway: I am not going to take much time because there has been a full debate on these matters on two occasions.
This is the first of a series of amendments to oppose the Question that Clauses 37 to 43—the whole of Part 5 of the Bill—stand part concerning incitement to religious hatred. By leave of Members of the Committee, I shall deal with them all en bloc. This is not an exercise in confrontation. As my noble friend Lady Buscombe said, and I support, it is a hope and belief that through the power of argument in this place we shall have another opportunity to persuade the Government.
If that is the approach, what could be more persuasive than the sense of this House as expressed yesterday and early this morning on the important area of Part 5 of the Bill in the light of reports of the Joint Committee on Human Rights, the Delegated Powers and Regulatory Reform Committee and the Constitution Committee that floated into the Printed Paper Office today, and debate in your Lordships' House on 21st November in which the right reverend Prelate the Bishop of Oxford sounded a note of caution and in which the noble Lord, Lord Haskel, said that for the first time he had found himself in agreement with anything I had ever said in your Lordships' House, albeit there was controversy as to whether criminalisation of incitement to religious hatred would or would not protect our Islam communities or work an unintended mischief?
There was controversy as to the scope of safeguards for the freedom of expression by those of any faith or none in favour or against any religion regarded as such. On those matters there was an area of controversy. But there was unanimity on the crucial issues, save from the noble Baroness, Lady Whitaker, who I had the privilege of having a word with today, who supported the Government for reasons which, with respect to her, did not convince me. They were that because of acts of terrorism, they have increased prejudice and created the present danger. With that dissent—I have been right through the Official Report; that was the only dissent—what was agreed by the House was, first, that there was no or no sufficient connection with terrorism and that Part 5 should not be included in the Bill. It runs right through the speeches in this House. Secondly, much further discussion, thought, safeguards and assurances, for which we all know there is no time, are required before Part 5 could be accepted as drafted or amended.
The Lord Bishop of Southwark: I thank the noble Lord for giving way. It is not quite accurate that there was total agreement that those clauses should not be
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part of the Bill. In my contribution I suggested that the matter needed to be tackled, even as part of this Bill. I also suggested:
"There is some merit in having the legislation in this Bill. September 11th and its aftermath placed stresses and strains on the religious fabric of society".—[Official Report, 22/11/01; col. 223.]
Lord Campbell of Alloway: I apologise to the right reverend Prelate. That is fairly watery support. If I misread it I hope he will forgive me.
The Attorney-General (Lord Goldsmith): As the right reverend Prelate has made that point, can I also draw the attention of the noble Lord, Lord Campbell of Alloway, to what was said by the noble Lord, Lord Harris of Haringey. He said that the time was right now. I understood my noble friend Lord Ahmed also to accept that it was appropriate now that this should be in the Bill, although he had doubts in relation to it.
Lord Campbell of Alloway: I certainly do not take that interpretation of those speeches. But let us not discuss that.
Assume that the noble and learned Lord's intervention is totally justified in those instances and assume that I am wrong. The fact remains that the broad sense of this House—whatever the noble and learned Lord may say, whatever the right reverend Prelate may think or say and whatever may be the position—was clearly in favour that there was no or no sufficient connection with terrorism and that Part 5 should not have been included in the Bill. From that I will not retract.
Secondly, the broad sense of the House was that much further discussion, thought, safeguards and assurances for which, as I have said, there was no time, are required before Part 5 can be accepted or indeed amended.
Thirdly, the broad consensus of the House was that if incitement to religious hatred is to be criminalised that should be done after discussion on a comprehensive basis in another Bill. The right reverend Prelate, if I remember correctly, assented to that proposition, but I may be mistaken.
It is the hope that the Government shall defer to the broad sense of this House between today and Report stage by a concession to remove Part 5 from the Bill for the reasons that I have given. If in certain particulars they were in error in the opinion of Members of the Committee, it cannot be contended that they do not represent the broad sense and advice of this House. I ask the Government to yield to persuasion.
11 p.m.
Earl Russell: First, I owe an apology to the right reverend Prelate the Bishop of Southwark. During his speech I was talking into the other ear of the noble Lord, Lord Campbell of Alloway, about the possible wording of an amendment on which I hope that we have now reached agreement. So if he did not absorb everything that the right reverend Prelate said, the fault is mine. I am sorry for that and I offer an apology.

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We have three separate questions here. First, should incitement to religious hatred be an offence? Personally, I am inclined to the view that it should. As a 17th century historian I know something about religious hatred. I know that people have died as a result of it. I remember reading of an occasion when Archbishop Laud on trial before this House rashly expressed the opinion that the Pope was only probably anti-Christ. He was therefore denounced over and over again as the very pander and broker to the whore of Babylon.
That makes one of my points. But I am not certain whether or not such language is covered by the Bill. Before any such Bill reaches the statute book I think that it would be well to know whether or not that is the case.
Therefore, in principle, because as a House of Parliament we must be concerned with keeping the peace, we should be prepared to consider legislating on the subject. That leaves us with the two questions: whether we should legislate in the Bill and whether we should legislate in the draft. My noble friends as a whole say that we should not do it in this Bill. Such a provision is not emergency legislation. It needs to be drafted with immense care, sensitivity and thought, after the widest consultation and after consideration of all the possible ways in which it could be misinterpreted in court. We do not think that the provision will receive that within the timetable allowed for the Bill. The consequences of that could be serious.
I appreciate the force of the argument repeated by the right reverend Prelate the Bishop of Southwark: that September 11th has put a strain on the social fabric where religion is concerned. I am on record—the noble Baroness, Lady Uddin, will bear me witness—as having spoken up about the need to protect the reputation and standing of British Muslims before any Bill was in evidence. I feel strongly about that need. The Bill does not meet it. There is something inherently paradoxical about saying that one is doing two things at the same time because they are not connected.
Those Members of the Committee who have faced discrimination because they happen to be women will know that such discrimination is usually preceded by the words, "This is not because you are a woman, but …". Those who have faced discrimination on grounds of race are familiar with the phrase, "It is not because of your race, but …". Those who have been discriminated against for being from public school have faced the phrase, "It is not because of your education, but …".
The mere conjunction of the two things reinforces in the minds of many people the idea that we are in fact engaged in hostilities with the Muslim community, which is the very idea that we most want to avoid. There is opinion poll evidence to that effect, as well as my experience from talking to large and varied collections of people on the matter. So although the objective of including the provision in the Bill was good, and one that I share and respect, we will not achieve it.
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But what I am really worried about is the drafting. It seems to be assumed in the drafting of the whole of Part 5 that one can make a read-across from racial to religious hatred—that one can use the same legislative framework to deal with both. That strikes me as a dangerous and misplaced assumption. After all, thank God, race is not an opinion; race is not protected by free speech. Correspondence in the press, much of it based on misunderstanding—but misunderstanding that the Bill as drafted does not do enough to dispel—is concerned that freedom of speech and freedom of thought in religious matters should be preserved. I share that concern.
What we need is a clear distinction that we hate the sin and hate the sinner. I look in the Bill for that distinction and I do not find it. We also need a test of mens rea, which must take account of circumstances. I am reminded of John Stuart Mill's famous passage on the corn chandler. We need something along those lines in our drafting. The opinion that all property is robbery, or that corn dealers are starvers of the poor, ought not to be prohibited when merely circulated through the medium of the public press but ought to be prohibited when orally delivered to an excited mob before the house of a corn dealer.
That is a clear distinction that goes to the point of intention. It is a distinction that the Parades Commission in Northern Ireland has attempted to apply in practice.
I can remember that when I was young, magistrates ruled that Mosleyite processions were not allowed to go through certain Jewish areas, although they were allowed to go through other areas, because the sheer decision to go through such an area was considered conduct liable to provoke a breach of the peace. I can understand that reason and I can respect it. The choice of route on occasion may be a deliberate expression of hostility and it is for that reason, rather than the fact that it is a parade, a speech or whatever, that it should be restricted.
We need some attempt at mens rea in the Bill. We need something in the words which are to be complained of to express an implied threat. I am rather disinclined to prohibit the view that the Pope is Antichrist if it is expressed purely as an abstract proposition. But the words spoken to Edmund Campion on the scaffold—"In your Catholicism all treason is contained"—are words which, I hope, will be covered by a properly drafted Bill.
We have a vitally important distinction which I believe is not beyond the skill of our present parliamentary draftsmen. We have not even attempted to look for it. There is something here we ought to be doing, but we need to go back to the drawing board and start again.
11 p.m.
The Lord Bishop of Blackburn: There may be few Members in the Chamber tonight, but I do not believe that we should underestimate the number of people who are listening and will be reading the purport of the debate. We are dealing with a most sensitive subject

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and I believe that there is a direct relationship between incitement to religious hatred and the events of 11th September. They have totally transformed the lives of the people among whom I live and work in East Lancashire, where Christians and Muslims—the two faiths—work together but face each other within the local communities. I cannot overestimate to the Committee the significance of the events of 11th September to those communities.
We have a regular annual meeting when the Christians and Muslims meet in some number to discuss general issues; for example, drugs. We had such a meeting in October on family values. There was not a single Islamic speaker, from scholars to ordinary members of the audience, one might say, who did not begin their remarks without referring to "Islamophobia". It was in the air and in the nature of the people in the community at that time.
I have a great deal of sympathy with what has been said by the noble Earl, Lord Russell, but I urge the Government to continue to try to address the matter in the coming days. The time is short. I believe that it is entirely proper that it has a place in the Bill. I have great sympathy with the noble Earl, Lord Russell, who said that the words in the Bill and in the amendment may not be right. One has immense sympathy with Amendment No. 100 tabled by the noble Lord, Lord Dixon-Smith, where he brings in the protection of academic and theological debate and discussion. Everyone wants to include that, yet his amendment loses the provision at Clause 40(4) on page 20 which is the balancing protection for people of no faith.
Having heard the debate and the remarks of the noble Earl, Lord Russell, I do not believe that it is beyond the draftsmen in this House to attempt to produce something within the next few days. It is necessary for the Government and those such as the noble Lord. Lord Campbell of Alloway, who would remove these clauses or amend them to reflect before the Report stage in order to achieve a balance between protecting those in so many of our communities who have genuine fears of incitement to racial hatred which they live with daily and the curtailment of the freedom of speech, of serious debate, which we enjoy.
If we do not get that right, we shall arouse fears in other communities. A number of Christian people have written to me because they are seriously worried about some of the implications of these clauses on what they might want to say about the faith held by others. I believe that the time is now. It will be difficult whenever we do it. But there is a direct link between this matter and the terrorism which we seek to suppress.
Lord Campbell of Alloway: Before the right reverend Prelate sits down, is he aware that today I found in my chambers unsolicited a long e-mail from an Islamic association, at the back of which appendix A listed all the communities—I believe that there were five—that it represented? In essence, it did not believe that enough thought had been given to this problem, it was wholly unhappy that this matter should be rushed and
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so on. It wanted more time for consideration to be given to this matter. I left the document on a table in the Library and during luncheon someone borrowed it. Therefore, I apologise for speaking to a document which I have read but somehow has gone.
The Lord Bishop of Blackburn: I was unaware of the private correspondence of the noble Lord. However, I understand that two days ago the Muslim Council of Great Britain, which is a significant body, issued a statement which was largely supportive of these clauses. Certainly in the communities with which I have communication and where I live and work there is broad support for this measure, with the realisation that we are in a difficult and sensitive area of legislation.
Lord Williamson of Horton: I am not deterred by the late hour from intervening on this extremely sensitive point where we must be careful to make the right decision. A wrong decision is likely to be exploited and will probably be counter-productive. I am among those who believe that we should not include this provision in the Bill. However, I should like to make one or two brief comments since amendments have been tabled at Committee stage and I am not sure how the issue will finally be resolved.
Like the noble Earl, Lord Russell, I feel that it is important to distinguish between the different questions posed by the amendments which have been tabled. The first question is: should we legislate at all to add religious hatred to offences under the Public Order Act 1986? Secondly, if so, should we do it simply by adding "or religious" after "racial"? I share the view of the noble Earl that that is not a good way to handle the issue. Thirdly, should we increase the penalty, which is the effect of what is proposed, from two to seven years? Fourthly, since Amendment No. 103 is also before the Committee, should we abolish the crime of blasphemy? That has not been mentioned so far, but if we look back to the history of our country that matter has been in the news quite often in past generations. I do not believe that we are ready to insert that offence into this Bill at present.
I should like to comment on the other points. First, if we did go in that direction at this time, which I do not favour, the amendment tabled by the noble Lord, Lord Dixon-Smith, would be a gallant attempt to limit the offence of religious hatred by introducing the criterion of intention to contribute to criminal conduct against a member or members of a group. I believe that it would be an improvement if in the end we went in that direction. Secondly, I consider that the increase in penalty from two to seven years is disproportionate and I do not support it. Thirdly, I support the amendment tabled by the noble Baroness, Lady Whitaker, to remove blasphemy from the list of common law offences.
11.15 p.m.
Lord Desai: As noble Lords will know, I feel very strongly about this issue and have always done so. In answer to the questions posed by the noble Earl, Lord

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Russell, I would prefer that we did not legislate at all on this matter. If we are going to legislate, I would prefer that we did not do it the way we are doing it now by adding "religious" to "racial" hatred. If we are to go down this route, I would prefer some kind of amendment—although I have not yet grasped the details that would take us down the road suggested by the noble Lord, Lord Dixon-Smith.
Singling out the Muslim community in defence of this clause will do a great deal of harm. I said that yesterday and I will now say it again: it will do a great deal of harm. The partition of India was based on a confusion between religion and nation, and millions of people died in that confusion. When people say that they hate Muslims, it is not a question of religious orthodoxy; it is not about the Koran; it is not about the Pope being the Anti-Christ; it is not a doctrinal dispute; they hate the Pakis basically. They hate a certain group of south Asian immigrants who happen to be Muslims; they hate the Muslim nation in Britain.
But it is not the nation of Islam—as represented in the US by the Black Muslims—which is being targeted. The people being targeted are south Asian Muslims from Pakistan, India and Bangladesh. They are not a race. I do not think that we should raise the whole gamut of problems connected with religious hatred, theology, disputations between sex and Christianity and so on. I strongly believe that religion is the wrong label. I do not know what is the right label, but religion is the wrong one.
There should not be discrimination against British Muslims, but in labelling people by religion rather than as a certain kind of ethnic group we are making a major mistake. The consequences will be horrendous because the Hindu community in Britain will be deeply offended. Although the Bill relates to all religious hatred, everyone is saying that this is a problem connected with Muslims.
The Prime Minister said that we are all children of Abraham. Many people in this country are not children of Abraham, but we have to look after them as well. We do not have a cartel of Christianity, Judaism and Islam—they are very similar religions and so they quarrel all the time—but if you say that the Bill is for Muslims you will offend a large part of the ethnic minorities.
Baroness Whitaker: Does my noble friend accept that people of no belief are also protected?
Lord Desai: As an atheist, I am deeply offended by that. Hindus are not people of no belief. If you say that, you will have a deep problem.
Baroness Whitaker: The Bill refers to people or religion or belief.
Lord Desai: I still believe that we should not go down this road. We will import, in a more excited manner, all the divisions of the sub-continent, and that is not the road we want to go down.
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I know that I will not get my way on this—I know that the Government will get their way and that I am wasting my time—but I still believe that I should say it.
The Lord Bishop of Southwark: Perhaps I may briefly make two points. First, the members of the Inner City Religious Council, which has been in existence now for more than a dozen years and consists of members of all religious faiths, have, for all that time, been pressing the Home Office to bring in legislation of this nature. It is not only to protect the Muslims; it is thought to be necessary by the representative people of all faiths.
They have not had a great deal of success over those years with the Home Office. If I may quote from the speech last night of the noble Lord, Lord Waddington, it will indicate why they have not. He said:
"Having waited for 16 years for it to become law, we can face with equanimity the possibility of having to wait for a few more years".—[Official Report, 27/11/01; col. 189.]
Although I do not agree with them, I understand the logic of Members of the Committee who say that this provision should not appear in this Bill. But I do not believe that if the provision were removed from the Bill it would appear in another form in the foreseeable future. It would not appear at all. Now is the time to tackle this issue. Following the events of 11th September, it has become pressing, but it is a matter about which the faiths have felt strongly for many years.
Lord Lucas: The noble Lord, Lord Desai, should not give up hope. There is every hope of postponing this part of the Bill.
I entirely agree with those who say that incitement to religious hatred should be an offence. We can all see instances where what some people get up to or might get up to should be prohibited by law. But religion and race are absolutely not parallel. Race is something that you are born with; religion is something that you choose, or at least partly choose. Religion stretches from being part of the culture that one is born into, to politics. There are elements of religion which are just as disputatious and rightly subject to argument as people's political beliefs. I do not believe that we are about to legislate against stirring up political hatred.
There are things that are done by various parts of Christianity which cause me enormous difficulties and offence. One major example is the Catholic position on birth control and its consequences for the rest of the planet. I should not wish to be restrained in arguing about that; nor should I wish to be restrained in arguing about some of the stranger practices and elements of Sharia law. Also, I should riot want those who express more extreme views about the treatment of animals to be restricted in their criticism of Jewish and Islamic practices in the killing of animals. I do not agree with them, but I do not believe that they should be restricted. They pass reasonable comment on a religious practice which is essentially political. It is not something that should be subject to protection. It should be subject to reasonable criticism.

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We have to draw a fine line between someone's intention: whether it is to argue against a particular religious practice or whether it is to stir up hatred against a religious group. That is difficult to do—as the noble Earl, Lord Russell, said—by merely trying to draw a direct parallel between race and religion. The issue of race is simple. We should not accept discrimination in any form, ever. We should not accept the stirring up of hatred or dissent in any form, ever. That does not apply to religion. In religion we have to draw a much more difficult, much greyer, much more human balance; and we need a rather more complicated piece of legislation to do it. I cannot see how, in the time-scale given for this Bill, we can achieve what we should all like to achieve.
Lord Hylton: I shall be brief. We need to remind ourselves that we live in a largely secular society in which attendance at any form of religious worship is dropping and is at a very low level. That is not to say that moral values influenced by religion are not more prevalent than religious observance.
It is true that since early September there has been an increase in attacks on religious buildings—mosques, synagogues and churches. But they are not widespread across the whole country; they are localised. Therefore, I support the view advanced by the noble Lord, Lord Campbell of Alloway, and backed up by the noble Earl, Lord Russell.
I return to remarks that I made in the debate yesterday. This extremely complex and difficult subject would be far better left to more mature considerations, outside of any emergency context. I went on to say that if the Government will not remove these clauses or split up the Bill, they are likely to do lasting harm which they will come to regret.
Lord Dixon-Smith: I may have to apologise to the Committee because even at this hour of the night I do not have the remotest idea how long my remarks will take. I apologise sincerely for that. However, we find ourselves in a serious difficulty.
When the Captain of the Gentlemen-at-Arms pointed out this remarkable grouping, he said that it is to enable us to have a proper discussion over the method by which we take this matter forward. The noble Lord may not have thought those words through but I read into that—I am open to be corrected of course—that in fact the Government were not absolutely certain whether it was right to take forward Part 5 of the Bill at this time. I may be reading far too much into what the noble Lord said. I am happy for him to tell me that that is so. I am prepared to accept that I may be wrong.
Lord Carter: When we saw this extraordinary grouping, I simply explained to the noble Lords, Lord Campbell and Lord Dixon-Smith, that, although on Report we could have an amendment to leave out Part 5, I thought that the intention was to have a general debate on the whole of Part 5. Each clause of the Bill has to be put forward in Committee. The only way to
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deal with the matter in Committee was to list the whole business as a debate on clause stand part. I assumed that the Committee would welcome a general debate on the whole of Part 5, hear the Government's response and then decide what to do. It is up to noble Lords to decide how to deal with it but by having this grouping it enables the Committee to have a general debate on the whole of Part 5. That is all.
11.30 p.m.
Lord Dixon-Smith: I am grateful to the noble Lord for that explanation. It seems to reveal an uncertainty.
The difficulty is that the grouping seems completely to remove Part 5 from the Bill while at the same time containing amendments of substance, one of which we have proposed, which would attempt to improve the Bill. Although we have done the best we can in the time available, I do not regard that amendment as either the be-all or end-all of what is required in order to make the Bill adequate and sufficient. So we are looking at a general debate as to methodology.
I have a fundamental problem. Having considered the subject with some care, I accept the principle that legislation in this area is desirable. I have no difficulty with that proposition. However, is this provision appropriate as an add-on to the Bill? That is what it is. Except in the most indirect of indirect ways, I cannot find any linkage between this part of the Bill and anything to do with anti-terrorism. Similarly, I cannot find anything that relates it to security or national security. I would resent the suggestion that it had anything to do with crime. Those areas are encompassed in the Title of the Bill. Therefore we have a difficulty.
I have already described this as a premature Bill. I do not doubt the Government's honour and intentions in bringing the measure forward. I am sure that it was done for the best of reasons. However, given the timescale in which the Bill has had to be drafted—it is still only 11 weeks since September 11th—and the pressures that there have been throughout that period, one would have to have the gravest doubts about the adequacy and, even more significantly, the depth of any consultation across religious groupings of all sorts. I do not doubt that soundings were taken here and there, but soundings are not consultation.
Another problem is that we are dealing with matters that impinge enormously on the boundaries between freedom of speech and the possibility of it becoming something else. Looking at history, it is thoroughly deplorable that religion of all sorts over the millennia has all too often been hijacked by man for entirely human, and often thoroughly disreputable and dishonourable, purposes. It gives me no satisfaction or pleasure to acknowledge that. As an historian, the noble Earl, Lord Russell, knows about that subject in far greater depth than I do. We are in danger of going down the same road to a degree if we are not careful.
The right reverend Prelate the Bishop of Blackburn, speaking in favour of the Bill, made the perhaps inevitable Freudian slip—he was probably not aware of making it—of referring to racial instead of religious

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hatred. Most of the motivation of those who in recent times have dealt in a wholly deplorable way with some Muslim communities has been not religious but racial. We need to recognise that.
If we are to deal with the subject, we should all be certain that whatever law we end up with must deal equally with each and every religion and, if necessary, those who have no religion. When we go down that road, we begin to impact strongly on the fiercely evangelical branches that exist in almost every religion. Once we start going into that area, we begin to get into great difficulty.
The right reverend Prelate the Bishop of Blackburn said that we should go ahead with the proposals because they are here and we have the time, but he acknowledged that what we have before us may not be ideal. We have a week in which to draft what is in effect a new Bill, if that is what we are to attempt to do. I am a modest man. I would not attempt to cover such a subject properly in that timescale. I think that it was the noble Earl, Lord Russell, who said that we cannot read over from religion into the Public Order Act 1986. It is not as simple as that. Really major effort would be required.
I conclude, sadly, that if we are to go down this road, we no longer have an option. We cannot discuss the detail without great difficulty, and if we come back at Report stage when debate is more constrained, and then at Third Reading when it is even more constrained, we shall not have the time physically to do the work and still less to carry out external consultations that are properly required before dealing with this part of the Bill.
I accept that it is desirable to legislate to try to contain those unfortunate aspects that occasionally reveal themselves in our society as a result of religious prejudice. I make a clear distinction between religious and racial prejudice. We have to be far more careful, study and consult and take far more time than we can possibly give to this subject in the seven days that are left to us before the Government hope to enact the Bill.
When we reach those further stages, there will be only one real option: to strike these clauses from the Bill.
Lord Campbell of Alloway: Before my noble friend sits down, may I ask whether he accepts that racial hatred is adequately covered by our present law?
Lord Dixon-Smith: I am happy to answer in the affirmative. Of course it is. Indeed, many of the other incitement problems are also covered in other areas of the law.
Lord Hylton: May 1 ask whether the noble Lord, Lord Dixon-Smith, has spoken to his Amendment No. 97? If he has done so, it may be for the convenience of the Committee if I say something about Amendment No. 101.
Lord Dixon-Smith: The noble Lord, Lord Hylton, illustrates precisely the difficulty that we face. Before I
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can speak to that amendment, I have to speak to the Motions on clause stand part. If we were to start on that process, we would have to begin with a Motion from my noble friend Lord Campbell of Alloway which would mean that the amendment would become redundant.
Lord Goldsmith: The sense that I have taken from the debate this evening is that all Members of the Committee who have spoken agree that what we ate trying to outlaw in Part 5 is objectionable. The hatred and incitement of hatred of particular groups is to be deplored, should not be condoned and must be outlawed. The disagreement is on how to achieve that and whether to do it in this Bill.
I had understood from the amendments that have been tabled that there were specific points on the drafting of the proposed clauses. We have listened, as we always do, with care and attention to proposals from Members of the Committee to improve the aim that we wish to achieve, on which there seems to be agreement. I am happy to deal with specific problems in the proposals. As the noble Lord, Lord Dixon-Smith, did not feel it appropriate this evening to explain those amendments, I shall do that in the briefest possible form, simply to indicate what the concerns are.
Lord Avebury: Will the noble and learned Lord make clear that in speaking at this moment he is by no means pre-empting further debate on the remainder of the amendments which have not yet been moved?
Lord Goldsmith: I am entirely in the hands of the Committee. A number of clauses are grouped together. If in fact all that is being put at the moment is whether Clause 37 shall stand part of the Bill, I shall simply say that that does not concern religious hatred. Clause 37 is about racial hatred and an amendment to the definition in that regard.
Lord Campbell of Alloway: The noble and learned Lord is out of order. If no amendments have been moved, it is not in order for the Government Front Bench to speak to them.
Lord Goldsmith: I understood from what the noble Lord, Lord Dixon-Smith, said, that he was speaking to the whole of these matters. I entirely accept that groupings are not mandatory. But I understood that we were speaking to the whole of this group. I give way to the noble Lord, Lord Dixon-Smith.
Lord Dixon-Smith: I entirely support the Minister in that we have to be debating something; that it has to be a Motion. If there is no Motion before us, we are all seriously out of order and have been for some time.
Perhaps I should say this in relation to Amendment No. 100, which is the main one in this group. What we seek to deal with in that amendment is the point of mens rea, which was raised by the noble Earl. Lord

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Russell. How far we succeeded in that remains to be seen. If I give it that introduction, at least the Minister will have a hook on which to hang the hat.
Lord Avebury: Perhaps I can ask for further clarification. The Chief Whip said that we were debating all these amendments together, including all the clauses. I thought that after the noble Lord, Lord Dixon-Smith spoke—presumably he was addressing himself to his Amendments Nos. 97, 98, 99 and 100, although it was not clear to me from what sounded more like a Second Reading speech on Part 5—that the noble Lord, Lord Hylton, would speak to his Amendments Nos. 101 and 102 and following that the noble Baroness, Lady Whitaker, would speak to her Amendment No. 103. I was therefore surprised when the noble and learned Lord stood up and appeared to be pre-empting further debate.
Lord Goldsmith: I was not pre-empting. This is Committee. I stood because no one else was standing. The grouping is set out and no one indicated that they objected to it. The noble Lord, Lord Dixon-Smith, agrees. If the Committee wishes to deal with this in a different way, so be it. The last thing I want to do is to stifle any debate on any point. I want to deal with points raised by the Committee and I am happy and ready to do that. Perhaps the noble Earl, Lord Russell, will come to my rescue.
Earl Russell: I can assure the noble and learned Lord that as far as I can see he behaved with impeccable propriety and entirely in accordance with the customs of the Chamber. Nevertheless, it may be for the convenience of the Committee if at some stage Amendment No. 103 in the name of the noble Baroness, Lady Whitaker, was debated. If he could indicate when it may be convenient for us to do that, it may help us.
Lord Goldsmith: If my noble friend Lady Whitaker would like to deal with that now and that is convenient to the Committee, I am happy with that course. The matter has then been put and I can respond to the whole group.
11.45 p.m.
Baroness Whitaker: I shall be brief. This is a very discrete aspect of the general debate and this is not an original amendment. It follows the Bill moved by the noble Lord, Lord Avebury, in 1995 and it implements a recommendation made by the Law Commission in 1985. They said,
"we take the view that where members of a society have a multiplicity of faiths or none at all it is invidious to single out that religion [i.e. that of the Church of England] for protection … the common law cannot remain as it is … our consultation confirmed this view".
Their consultation was of over 1,800 organisations, groups and individuals.
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The Law Commission implied one semi-reservation, saying that the only persuasive argument against the amendment was,
"the criminal law should provide some protection to religious believers from suffering offences".
It is because in this Bill the criminal law does provide such a safeguard that it is right to attach repeal of the blasphemy law after Clause 42 and I support the inclusion of Part 5 for the reasons that the right reverend Prelate set out so tellingly.
The Law Commission's assumption that it is inequitable to protect one part of the Christian faith without signalling equal respect for other faiths, or non-religious beliefs, is the main reason for this amendment.
But there are others. "Blasphemy" is quite undefined in law. Since one of the main attributes of law is certainty, this is hardly satisfactory. Blasphemy, nevertheless, is an absolute offence, one of strict liability, which means intention plays no part and any defendant is unable to give evidence about their own belief or purpose. In theory, one could commit accidental blasphemy and be just as guilty. It is hardly surprising that the Home Office undertook in 1989 to take no more state prosecutions for blasphemy.
I suggest that now we have a proper provision which protects believers of every kind from incitement to hatred on the grounds of their belief, this arcane and inequitable law should become history. So should its equally vague accompaniment, "blasphemous libel".
Finally, the Law Commission also held that the offences of disturbing a religious service or devotions, and striking a person in a church or churchyard should not be criminal by virtue of being crimes against the Church of England, but to the extent that they constitute criminal behaviour, be caught by the criminal law in general. Thus I propose that this part of the Law Commission's amendment should also be adopted.
Lord Avebury: I am delighted that the noble Baroness, Lady Whitaker, has managed to get her oar in at last. I am sure that it will be greatly to the convenience of the Committee if the noble and learned Lord replies to this amendment when he deals with all the others which are grouped with it, as was suggested by the Chief Whip.
I believe that many people will object that blasphemy is even more remote from the purposes of the Bill than Part 5 itself. But there we are. It was discussed in another place and we have it before us here. It is a very useful opportunity for clarifying what is the present attitude of the Church. The right reverend Prelate will correct me if I am wrong, but I understand that the official position at the moment is to wait and see what happens to this Bill and only then to express an opinion on the blasphemy law.
In 1995, after my blasphemy abolition Bill was defeated at Second Reading, the most reverend Primate set up a small staff group to consider what was the best way forward from the Church's point of view. I do not know whether that group ever reached any

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conclusions but I understand that its present view is not that the blasphemy law should be extended to cover other faiths, as Mr Dobson suggested might be the case in another place.
That is certainly reassuring as it would open up a Pandora's box if that were done. I think that not many people realise that the blasphemy law now has a very limited meaning in law—much less extensive than it has in ordinary English usage—being confined to the use of scurrilous or grossly offensive or abusive words tending to vilify the Christian religion. Blasphemy and blasphemous libel—the difference between the two concerns whether the matter is spoken or written—are, of course, offences at common law, as the noble Baroness explained, and their scope has been progressively narrowed over the three centuries of their history. The working definition is that which is contained in Stephen's Digest of Criminal Law, which was used almost verbatim by the trial judge in the Gay News case in 1979. For the benefit of those who think that there will be a great restriction on people's ability to criticise other religions, the denial of any of the doctrines of Christianity, mocking or poking fun at Christian beliefs, or the portrayal of sacred persons or objects in a profane setting would not be enough to satisfy the test. Some people belonging to other faiths might well be disappointed, if the blasphemy law were extended to cover other religions, to discover that its application is so restricted, and I am afraid that there would be constant pressure for the offence to be widened.
The Home Secretary said,
"There is a good case for … removing existing blasphemy law".—[Official Report, Commons, 26/11/01; col. 707.]
But then he suggests, also at col. 707, that the Church of England's Board for Social Responsibility should hold a debate about helping the Government to,
"achieve a measure that is less anachronistic and more appropriate to the 21st century".
The right honourable gentleman was being very modest as the provisions of this part of the Bill already deal with speech, behaviour or writing that is threatening, abusive or insulting and likely to stir up hatred against a religion, and would allow prosecution in any conceivable circumstances where blasphemy might now be used.
I do not intend to enter into an argument about the general merits of Part 5 and I assume, for the purposes of the amendment I am discussing, that we shall pass the amendments dealing with incitement to religious hatred as they stand, whether or not the Committee thinks that there should be further consideration and further consultation with outside forces. But in this particular case of blasphemy why should this long delayed reform wait on the Board for Social Responsibility? With great respect to the Church of England, it has had more than six years to consider it since the previous occasion when it came before this Chamber and it is time we came to a decision. If it has to be done by separate legislation, the arguments put earlier by the right reverend Prelate the Bishop of Southwark apply with even greater force. It is very unlikely that time would be found for that in the
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parliamentary timetable. It would take up scarce parliamentary time. With all the pressures that exist I cannot see it happening. There will always be something more urgent in the queue. As Mr Dobson suggested when he moved the amendment in another place, let us do it now.
Perhaps I should say a few words about the other offences mentioned in subsection (1(b) and (c) of the amendment which were dealt with in the Law Commission's Offences Against Religion and Public Worship document of 1985. Those are largely concerned with obstruction of religious ceremonies. As an example, Section 2 of the Ecclesiastical Courts Jurisdiction Act 1860 penalises any person guilty of,
"riotous, violent or indecent behaviour"
in a place of Christian worship or in any churchyard or burial ground. The Law Commission cites a case where a person was convicted under that provision as recently as 1968 when he disrupted a church service attended by members of the government, his purpose being to draw attention to the then government's alleged support for US policies in Vietnam.
At the time, the Law Commission did not believe that Section 5 of the Public Order Act 1986 would work in this context because, in the special circumstances of a church service, it was unlikely that a breach of the peace would have been provoked. Now, under Part III of the Public Order Act 1986 as amended by this Bill, the use of threatening, abusive or insulting words or behaviour with the intention of stirring up religious hatred, or whereby religious hatred is likely to be stirred up, is an offence whether the action occurs in a place of worship or elsewhere. I hope that it can be agreed that all the rarely used provisions in those ancient statutes should be repealed.
In 1995, I argued that the Public Order Act 1986 would deal with utterances or the display of writing that fell within the definition of blasphemy as it had been developed by the courts and, specifically, in the Gay News case. There was still a gap at that time in that, if such material were published but never displayed, it would not be caught. The new offence of incitement to religious hatred closes that loophole as it extends to the publication and distribution of written material. I hope that it may be agreed that any material offensive enough to be prosecuted as blasphemous under the law as it now stands would be equally capable of being dealt with under the 1986 Act as the Government now propose to amend it.
Therefore, the right reverend Prelates can afford to relinquish the special protection which the blasphemy law has afforded their particular religion. In doing so now, when the Home Secretary—as he said in another place—has not yet made up his mind on the matter, they would earn the respect and esteem of other faiths. Priests and bishops of the Church of England are always affirming their commitment to a genuine multi-faith society. Here is an opportunity for them to demonstrate that in a practical and public manner that will cost them nothing.
The Lord Bishop of Blackburn: The noble Lord, Lord Avebury, challenges these Benches to make some response to what he has just said. Perhaps I may say, first, that I do not believe that it is appropriate to piggy-back this very serious matter on to this emergency Bill. If it were done in that way, I believe that it would send out quite the wrong signals as to what we intend, and not simply to members of the Church of England. It is not always understood in the wider community that, as the noble Lord, Lord Avebury, rightly says, this measure applies only to the Church of England. I believe that the behaviour of many other people rides, if I may express it in this way, on the back of that understanding.
The matter was made quite clear in the Second Reading debate yesterday evening by the right reverend Prelate, my brother the Bishop of Southwark. The position is that, as of today—I shall return to that "as of today" in a moment—the Church of England is not opposed to a review and a revision of the blasphemy law if something better can be put in its place. That would affect other religions and, indeed, other Churches. However, the reason that I say "as of today" is that tomorrow the subject of blasphemy legislation will be on the agenda of the Archbishops' Council, which is the leading consultative body in the Church of England.
Therefore, we remain ready as a Church to enter into discussion with the Government. But I believe that it is a matter for the Government to instigate this type of discussion with the Board of Social Responsibility, or whichever body is appropriate in the Anglican Church and in other faith and religious groups. But I believe that it would be strange to remove legislation which at present at least protects some at a time when others are seeking a similar provision. It appears rather paradoxical to go about it in that way.
I now turn to the amendment in the name of the noble Baroness, Lady Whitaker. Leaving aside the whole question of blasphemy, unlike the noble Lord, Lord Avebury, I am seriously concerned about the implications of removing paragraphs (b) and (c), as set out in her amendment. Such offences may seem archaic, but there is growing evidence in this country of disrespect for people engaged in worship and devotion and, indeed, of the desecration of sacred places. That is a sad fact, but it is a fact.
As we react to the consequences of international terrorism, this is not the moment to remove clauses from the Bill. I hope that the noble Baroness will not move her amendment because I believe that it will rouse fears in many people at present. I also hope that the Government—this may be the assurance which the noble Lord, Lord Avebury, seeks—will give this matter serious consideration and, if appropriate, bring forth legislation on some other occasion in order that we may have a clearer understanding of the blasphemy law and the need for it, or otherwise, within contemporary society.
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Earl Russell: As we are in Committee, I hope that Members will forgive me for stating three sentences on this amendment, which I have not previously discussed. Its purpose, which I support, is to create equality and not to cause offence—I take the point made by the right reverend Prelate the Bishop of Blackburn about paragraphs (b) and (c). If we agree to the amendment, we will, in a redrafted Part 5, have to think about giving protection against hurt that is liable to lead to a breach of the peace, which we would not otherwise need to do in that form; that is another reason why Part 5 is not yet in a fit state to be approved.
Lord Goldsmith: I make it clear that I will speak to the entire group and that I am doing so at least three minutes earlier than the time at which I started speaking yesterday.
I hope that the noble Lord, Lord Avebury, will forgive me for pointing out that I certainly did not stop my noble friend Lady Whitaker from speaking to her amendment; I am happy that that debate has now taken place. I want to deal, first, with the amendments that refer to the details of the proposed incitement. We should be able to do so briefly, given that the noble Lord, Lord Dixon-Smith, has not really developed the argument. Secondly, I want to say something brief about the proposed maximum penalty, which is picked up in the amendment of the noble Lord, Lord Hylton. I shall also deal with the amendment relating to blasphemy, which was spoken to by my noble friend Lady Whitaker, and Amendment No. 185, which proposes a formal consultation exercise. I will then deal with what has really been the substance of this debate; that is, whether the matter should be dealt with now, and in what form that should be done.
Before doing so, I remind the Committee of two points, the first of which involves the structure of Part 5. Although we have been concentrating on the question of incitement to religious hatred, I ask Members of the Committee to consider the fact that Part 5 deals with rather more than that. Clauses 37 and 38 relate to the existing offence of racial hatred and amend the definition. No one has suggested that those are inappropriate amendments to make in this country and Northern Ireland, and I shall say no more about them.
Clause 39 will introduce incitement to religious hatred. Clause 40 is importantly different—it will add the concept of "Religiously aggravated offences"; that is, offences that are criminal offences. That has been done in relation to racially aggravated offences. The consequence—no one has spoken against this idea—is that particular conduct that is criminal would be treated as the worse because of the circumstances in which it took place. That would obviously be for the courts to decide. I had not understood that that part of the Bill was an issue in another place, at least with the main opposition party.
Clauses 41 and 42 deal with the penalties for the existing racial hatred offence and the new religious hatred offence, to which I shall return.

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The second point that I want to touch on briefly involves what the incitement to religious hatred offence amounts to in terms of its ingredients. It may help the noble Earl, Lord Russell, who picked up the question of what the mens rea is, and other noble Lords, including the noble Lord, Lord Lucas, who asked about what would and would not be an offence, if they consider what those ingredients are. I recognise that, in order to appreciate what they are, one has to read Clause 39 as it will be inserted into the Public Order Act—Members of the Committee will doubtless have done that.
I shall describe the ingredients. The first is that there has to be the use of threatening, abusive or insulting words or behaviour, or a display of written material of the same sort. That does not involve soberly expressed—or even robustly expressed—opinions.
Secondly, there needs to be either an intention to stir up racial hatred or, having regard to all the circumstances, a likelihood that racial hatred would be stirred up. Why is the second part necessary? It is because if someone uses language in circumstances which the rest of us, a jury or magistrates, would consider likely to stir up racial hatred they cannot pretend that they did not have the intention behind it. But there is an important additional element in Section 18(5) of the Public Order Act, which I hope will come back to the point raised by the noble Earl. That states:
"A person who is not shown to have intended to stir up racial hatred is not guilty of an offence … if he did not intend his words or behaviour, or the written material, to be, and was not aware that it might be, threatening, abusive or insulting".
There is an additional mental element which is included by way of specific defence. That would apply, as it does to the racial hatred offence, to the religious hatred offence. I invite Members of the Committee to consider that.
Hatred is a strong concept. It is more than contempt, disagreement or robust disagreement; it is hatred of a group and not of the religion. That is an important indicator also. Finally, as I mentioned yesterday, the offence is one which cannot be brought by way of private prosecution; it is an offence which can be brought only by or with the consent of the Attorney-General.
I turn to the first set of amendments. Amendments Nos. 97 to 99 seek to change the test to be applied to one of the incitement to religious hatred offences and to remove the provision which allows the person to commit an offence if in the circumstances their words or behaviour were likely to stir up religious hatred. That would be replaced with a test which requires that the person should contribute to criminal conduct against or by a member of a religious group. That is the essence.
There are two reasons for suggesting that that is not a good amendment. First, we suggest that it does not improve on what is proposed. Secondly, the amendment would criminalise something which is already a criminal offence. Therefore, it achieves nothing. It certainly does not achieve the intended end. It is the case that some people will deliberately seek to incite religious hatred but will do so in a calculated
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way. They will then say, "I didn't think that that would incite hatred". But it should not be possible to say that where it is clear to any judge and jury that any reasonable person must have considered it likely that others would be incited to hatred. That is why the 1986 Act refers also to the likelihood of hatred being stirred up. However, as I have just drawn to the attention of Members of the Committee, the Section 18(5) defence means that there will still be a specific defence in that case if the person did not intend his words or behaviour to be threatening, abusive or insulting. That is the first point.
The second point concerns contributing to criminal conduct. The simple fact is that inciting someone to commit a criminal offence is already an offence. That is what the common law offence of incitement is about. Religious hatred, like racial hatred, is not in itself, at common law or otherwise, a crime. It is not an offence to be a racist. That is why we must have a specific offence of inciting racial hatred. We cannot rely on the common law incitement to an existing criminal offence. That is why, for the same reason, we would need a statutory offence if we are to criminalise the behaviour of inciting religious hatred. But if all we do is to make that subject to being criminal conduct in any event, we do not achieve that end. We are simply criminalising that which is already criminal; it achieves nothing. We welcome any help in improving the Bill. However, I hope that when Members of the Committee think further about that point they will see that that does not achieve their end and will not pursue it.
Amendment No. 100 is another approach to the same theme. It concerns the six aggravating offences. The amendment looks rather long. That is because it picks up the same variation in all cases. What is being put forward is a defence that a person charged with this offence can show that his words were reasonable in all the circumstances or that he acted in the public interest.
The second part of the amendment defines reasonable conduct by reference to the circumstances in which the words or behaviour occurred. The third aspect defines what amounts to a person acting in the public interest by reference to words or behaviour that is fair, academic, political or theological comment.
I remind Members of the Committee that the starting point is that there have to be words which are threatening, abusive or insulting, either intended to or likely to stir up religious hatred. The question is: in what circumstances would the use of threatening, abusive or insulting words intended to or likely to stir up religious hatred be reasonable or in the public interest?
What we are looking at—as my noble friend Lord Ahmed powerfully pointed out yesterday—is the kind of circumstances where, on a website, a far right group is peddling hatred of particular groups. We may have words which are no different in kind from the words which could be used about groups which benefit from the existing protection—Jews or Sikhs. If the same

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language is being used in relation to another group but defined by its religion, that is the kind of conduct that we are concerned about.
I doubt that Members of the Committee would think that that kind of situation would be reasonable or in the public interest. The very essence of these offences, the people that we are concerned with, are not people who are reasonable. They are not people who are acting in the public interest nor are they discussing the finer points of theology.
It is not a question of robust criticism or one of disagreement with cults or with other religions and their beliefs. I repeat this again because it is so important. It is the use of threatening, abusive or insulting behaviour at its start.
I add that the offence will not in any event be brought unless I or my successor or successors decide that it is in the public interest that it should be brought. That is a safeguard for your Lordships to judge. It will help considerably, I suggest, to prevent unreasonable offences being brought. But the Government are alive to the concerns which have been expressed here and in another place. We do not underestimate that concern. My right honourable friend the Home Secretary said in response to an amendment, somewhat differently phrased but on the same theme proposed by Sir Brian Mawhinney in another place, that we will look again at whether there is a construction which can be used to protect the people we are all agreed we want to protect without creating new loopholes which will be exploited by the people we all agree we should be able to prosecute.
Amendments Nos. 101 and 102 deal with the penalty. The simple point here is that the Government believe that the increase from two years to seven years reflects the seriousness with which the offence should be treated. It is in line with the existing sentence of seven years for the range of racially aggravated offences in the Crime and Disorder Act. In the Government's view, that properly reflects the impact that these offences have on communities and public order in this country.
I turn to Amendment No. 103, the proposal for an introduction into the Bill of provisions in relation to blasphemy. The Government believe—a point I made yesterday—that the Bill is devoted to matters connected with, and which have arisen since, September 11th—anti-terrorism measures. Blasphemy does not come up in that context. We do not believe that the Bill is an appropriate vehicle for amending or repealing the common law offences.
It is quite right, as has been pointed out, that as long ago as 1985 the Law Commission recommended abolition of the law on blasphemy and blasphemous libel. Even at that stage, it talked about the introduction of an offence of incitement to religious hatred. The matter has not cropped up suddenly; as some Members of the Committee have said, it has been discussed for some time and been the subject of much consultation.
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However, the response to the Law Commission's paper—a response that has been reflected in what was said today by my noble friend Lady Whitaker, the noble Lord, Lord Avebury, and the right reverend Prelate the Bishop of Blackburn—demonstrated that there were important differences on the right way to deal with the issue of blasphemy. When the Law Commission issued its recommendation, there was considerable support for retaining the laws on blasphemy—some 1,700 out of 1,800 respondents were in favour, although many of them wanted it to be extended to cover other religions or faiths.
That is obviously a major issue between Members of the Committee: should we abolish the provision altogether or extend it to other faiths? That debate has important implications. While we wholly respect the reasons why the amendment has been proposed and the sincere concerns that surround the important topic that it covers, I must disappoint my noble friend Lady Whitaker. The Government do not consider the Bill to be the right vehicle to deal with the issue of blasphemy.
I shall deal briefly with Amendment No. 185 before returning to the main point. Amendment No. 185 is intended to stop both the incitement to religious hatred and the religiously aggravated offences in Part 5 coming into effect until after a formal consultation process with certain criminal justice organisations. That leads us well into the question of whether it is right for us to deal with the matter now.
The point of the provisions in Part 5 is to strengthen the law where it is weak and where it is necessary to deal with events after September 11th. I shall not repeat what I said last night, but since that date, there have been incidents that have given rise to grave concern in certain parts of the community—attacks and harassment. It is the connection between the events of September 11th and those events that has been in the Government's mind in bringing forward the provisions now.
I pray in aid the recent report of the Joint Committee on Human Rights, and invite Members of the Committee to study it. It deals expressly with the issue of freedom of expression, which certain Members of the Committee have raised. As I understand it, the Committee expresses itself content with what it has been told about the intention of the Bill: that the legitimate, pressing social need to outlaw particular despicable conduct justifies the limitations that the Bill would impose. Freedom of expression is not absolute. It is not absolute in relation to racial hatred. We do not permit people to say things that will incite racial hatred; that is not a legitimate exercise of the freedom of expression.
Our Joint Committee also draws attention to the concluding observations of the United Nations Commission on Human Rights earlier this month. It noted the recent upsurge in religious harassment and attack and urged the United Kingdom to extend its criminal legislation to cover offences motivated by religious hatred.

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In addition to that powerful urging to deal with the matter now, we have what I suggest is the important support of the right reverend Prelates present in Committee, both of whom spoke powerfully about the need, in order to provide proper protection in our community, to deal with the matter, and to deal with it now.
Baroness Buscombe: While dealing with that point, will the noble and learned Lord the Attorney General respond to a powerful speech made by the noble Lord, Lord Ahmed, yesterday when he said that he would have preferred a separate Bill dealing with incitement to religious hatred rather than the carrot and stick approach in this Bill?
Lord Goldsmith: Gladly, and I very much understand and respect what underlay that remark made by my noble friend Lord Ahmed. It may have been part of the thinking of the noble Lord, Lord Dholakia, when he spoke yesterday, but if I misinterpret him I apologise.
As the right reverend Prelate the Bishop of Southwark said, the choice we have is to deal with an urgent problem now in this Bill—it is the vehicle which exists—or to put it off. I understood my noble friend Lord Ahmed to be saying that, while he would have preferred to have dealt with the matter separately, he took the view that it was right to deal with it now because this is an opportunity to do so.
I noted the words spoken tonight by the right reverend Prelate the Bishop of Blackburn, who said, "The time is now", and the right reverend Prelate the Bishop of Southwark, who said, "Now is the time. It is a pressing issue". I invite the Committee to consider what the consequences would be for failing to deal now with an urgent problem and an anomaly. I return to a point I made earlier: is it not an anomaly that offensive threatening behaviour towards Jews and Sikhs is criminal but towards Muslims it is not?
That does not mean that the Bill, if passed, would protect only the Muslims. I deal here specifically with the point raised by my noble friend Lord Desai. It may he that 11th September is the catalyst for bringing the provision forward now and it may be that the attacks on the Muslim community are the catalyst for bringing it forward now. We believe that the Muslim community must be protected against false accusations. As my right honourable friends the Prime Minister and the Home Secretary made so clear, terrorism and belonging to the Muslim religion are very far from being part of the same thing. They are absolutely not the same thing at all. Muslims must be protected. That is the catalyst for the provision but the protection provided if the Bill were passed would be for every religious group; for Hindus and everyone else. I suggest that that is the right answer to my noble friend Lord Desai.
That is the key issue. I have indicated that the Government will look carefully at the point raised here and by Sir Brian Mawhinney on the precise definition. However, perhaps I may remind Members of the Committee that the overall structure is a tried and
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tested one for the racial hatred cases. It has not been dreamt up in a day for this Bill. Much thought has been given to it in the past and I suggest that we ought to consider seizing the opportunity to give the protection now rather than putting it off.
Lord Thomas of Gresford: Perhaps I may make a plea to the noble and learned Lord to clarify these clauses. It is extremely difficult to shuffle one part of the Bill into pre-existing legislation. Is it beyond possibility that before we return to the matter the Home Office officials in charge of the Bill could produce the clauses as they would appear? A practitioner would have the gravest difficulty in following the Bill; the CPS must make decisions upon it; and those who are liable to commit such offences would have no idea what the legislation was. Could we have something clearer?
Lord Goldsmith: Yes. There are two ways to deal with it. When the noble Lord, Lord Thomas, began I was not quite sure whether he meant for the purposes of this debate. I smiled because I was sure that he of all people would have no difficulty in putting the Bill and the Act together. It is possible to consider the inclusion of a Keeling schedule so that the Bill contains a version of the Public Order Act which would be amended to include this matter. Perhaps we may take it away. I accept the importance of understanding what the provisions do, and I shall ask for that to be considered urgently.
Lord Lucas: As I understand the noble and learned Lord, as long as moderate language is used a person can argue factually as hard as he likes. If one considers in particular some cults, which doubtless call themselves religions, one can argue for their prosecution, abolition and avoidance by all sane members of society as long as one does it in reasonable words. Is the noble and learned Lord saying that the fact that one expresses strong opinions does not make one liable to prosecution?
Lord Goldsmith: Yes, absolutely. The use of moderate language is not abusive, threatening and offensive, and it is not intended or likely to stir up hatred of a group.
Clause 37 agreed to.
Clause 38 agreed to.
The Deputy Chairman of Committees (Lord Geddes): I must advise the Committee that because of pre-emption, if Amendment No. 97 is agreed to I cannot call Amendments Nos. 98 and 99.
Clause 39 [Religious hatred offences]:
[Amendments Nos. 97 to 100 not moved.]
Clause 39 agreed to.
Clause 40 agreed to.

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Clause 41 [Racial or religious hatred offences: penalties]:
[Amendment No. 101 not moved.]
Clause 41 agreed to.
Clause 42 [Hatred and fear offences: penalties]:
[Amendment No. 102 not moved.]
Clause 42 agreed to.
[Amendment No. 103 not moved.]
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Clause 43 agreed to.
Lord Carter: I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.
House adjourned at twenty-nine minutes past midnight.