Police, Crime, Sentencing and Courts Act 2022 (Extraction of information from electronic devices) (Amendment of Schedule 3) Regulations 2023

Lord Sharpe of Epsom Excerpts

Tuesday 23rd May 2023 Lords Chamber

Moved by

[Lord Sharpe of Epsom]

That the draft Regulations laid before the House on 17 April be approved.

Considered in Grand Committee on 22 May.

Motion agreed.

Former Chief Constables: Gross Misconduct

Lord Sharpe of Epsom Excerpts

Monday 22nd May 2023 Lords Chamber

[Lord Lexden]

To ask His Majesty’s Government how many former chief constables are awaiting police gross misconduct hearings.

[The Parliamentary Under-Secretary of State, Home Office (Lord Sharpe of Epsom) (Con)]

My Lords, since 2020-21, the Home Office has substantially increased the data that it collects and publishes on police misconduct as part of the police misconduct in England and Wales statistical bulletin. It is working closely with the sector to improve the overall quality and consistency of the data that it collects. This does not include cases which have been referred to misconduct proceedings where those proceedings have not concluded.

[Lord Lexden (Con)]

My Lords, how can it possibly be right for former Chief Constable Mike Veale to have been able to dodge a gross misconduct inquiry in Cleveland for almost two years, while tarnished officers of lesser rank have been brought to account? May I remind the House that arrangements for the Veale hearing in Cleveland were the sole responsibility of a legally qualified chair, whose name is unknown, even though the law does not permit this individual to remain anonymous. What does that say about public accountability of the police in Cleveland? Finally, when I met my noble friend the Minister and Mr Chris Philp, the Policing Minister, recently—I thank them for that meeting—I made it clear that, unless the mysterious chair has now fixed a date for the start of the hearing, I would call on the Government today to use their reserve powers under Sections 79 and 91 of the Police Reform and Social Responsibility Act 2011 to end the impasse. Is it not time that this matter was finally resolved?

[Lord Sharpe of Epsom (Con)]

My Lords, the law is not being flouted. Arrangements for the misconduct hearing of the former Cleveland chief constable Mike Veale are a matter for the Cleveland PCC and not the Government. Any questions regarding who has been appointed as the independent, legally qualified chair would need to be directed to the PCC accordingly. As noble Lords will expect me to say, I will not comment further on that particular case. However, in answer to the second part of my noble friend’s question, I can say that operational policing is, as he knows, not a Home Office matter—it is for chief constables—but he is correct that the Home Secretary has powers under the Police Reform and Social Responsibility Act 2011 to ensure an efficient and effective policing system that protects public safety. That includes the power under Sections 40 and 40A of the Police Act 1996. However, these are for use only when either the police force or the local policing body itself is failing or will fail to discharge its functions in an effective manner. They are very much a last resort, and we do not believe that the current situation in Cleveland requires these powers to be used, as the PCC has appointed an LQC to the panel for Mr Veale’s misconduct hearing.

[Lord Bach (Lab)]

My Lords, I thank the Minister for the meeting he arranged, but will he please guarantee that the Home Office will never again stand idly by in a situation where a police and crime commissioner, in this case Leicestershire’s, employs as it chief adviser, and then as its chief executive, a twice-disgraced ex-chief constable facing an allegation of gross misconduct—all with substantial public money? Do the Government understand how offensive this is, both to the police force in question and to the general public?

[Lord Sharpe of Epsom (Con)]

The noble Lord makes a very good point. As he knows, in the case he describes, the usual and correct procedure was not followed in that county. I am very pleased it has finally been followed, so I agree with him.

[Lord German (LD)]

My Lords, this House owes a debt of recognition to the noble Lord, Lord Lexden, for his perseverance in this matter. Of course, there are obviously serious matters relating to the relationship between police officers and the law. I wonder if the Minister would care to comment on the words of the chief constable of the BTP, the transport police, who says:

“If I was to commit a crime, get arrested and give my details, there is no obvious system check that would flag that I’m a police officer if I didn’t choose to tell them”.


Does the Minister think that is an issue? If it is a problem, what are the Government doing to solve it?

[Lord Sharpe of Epsom (Con)]

I join the noble Lord in praising my noble friend’s commendable tenacity on this subject. Regarding the circumstances the noble Lord describes, I was not aware of them. Of course, he will also be aware that we have launched a review, which concludes this month, into the whole misconduct and dismissals process. With a bit of luck, it will report back in the next month or two, according to the Policing Minister in the other place. It will include a number of these issues, and I hope that will be dealt with then.

[Lord Cormack (Con)]

My Lords, if there were a gold medal for stonewalling, my noble friend would deserve to win it. The answers that he gives are obfuscatory and reveal nothing. Will he please consider again the questions asked by both my noble friend Lord Lexden and the noble Lord, Lord Bach? Will he also reflect on the point that came up during the debate we had in the Moses Room a week or two ago? I suggested to him, and he completely ignored the suggestion, that we should have a police ombudsman in this country: somebody who can exercise the sort of authority—dispassionate and impartial—exercised by the noble Baroness, Lady O’Loan, in Northern Ireland.

[Lord Sharpe of Epsom (Con)]

I thank my noble friend for his praise, which is very welcome. I remember that debate in Grand Committee and I am afraid I did not ignore his suggestion; I dismissed it. In fact, a number of bodies oversee policing, including the College of Policing, the IOPC, HMICFRS and a variety of other alphabet-soup organisations.

--- Later in debate ---

[Lord Campbell-Savours (Lab) [V]]

My Lords, why can we not have anonymity in accusations of sexual offences, particularly rape? They are a special category of criminal offence where the reputations of the innocent can be destroyed, even by chief constables like Mike Veale. The law is unfair, and I have raised this issue repeatedly over the years. I too congratulate the noble Lord, Lord Lexden, on his unrelenting campaigning on this issue; the House is deeply indebted to him.

[Lord Sharpe of Epsom (Con)]

Obviously that strays well outside the remit of this Question and the department, but I will make sure that the noble Lord’s reflections are taken back to the appropriate people.

[Baroness Jones of Moulsecoomb (GP)]

I will follow on from the good idea of the noble Lord, Lord Cormack, about having a police ombudsman. In their original Answer to this, the Government rather washed their hands of the whole issue of police and crime commissioners, which did not seem appropriate, as this Government set them up and put in the rules, parameters and laws—rather poorly, I think, but they did so. It is therefore wrong to throw away all feelings of guilt after things have gone wrong.

[Lord Sharpe of Epsom (Con)]

My Lords, as the noble Baroness is aware, we have conducted a two-part review of PCCs. The second part is due to be enacted soon.

[Lord Howell of Guildford (Con)]

My Lords, behind all this is the question of Operation Conifer, in which the reputation of a former Prime Minister and statesman was deeply and horribly smeared by the lies of a convicted paedophile, whose views were described by the police as “credible”. Given the obvious misdemeanours, mistakes and mishandling of the whole case, operations within the police seem to have been incredibly slow. The noble Lord, Lord Lexden, has asked endless questions over the years and this issue has never been brought to a head. Is it therefore not time for the Government, while not interfering with police operations in detail, to endorse and set up a completely independent inquiry to bring this appalling libelling and slandering of a now-deceased Prime Minister to an end? It is totally out of accord with the normal standards of justice and fairness in this country.

[Lord Sharpe of Epsom (Con)]

Many noble Lords have raised similar, very good points in recent debates. I shared this opinion with my noble friend Lord Lexden when we met last week. Having said that, there have been four inquiries into this case and all concluded that there was nothing more to do. However, I heard my noble friend Lord Howell’s concerns and will reflect them back to the department.

[Lord Coaker (Lab)]

I join other noble Lords in congratulating the noble Lord, Lord Lexden, and my noble friend Lord Bach, who have been campaigning on these issues for a considerable period of time. The Minister’s answers are simply not satisfactory. The noble Lord, Lord Lexden, has raised time and again the misconduct of Mike Veale, the former chief constable. The Minister simply comes back with a list of regulations, sends up smoke and does not answer the question. This is a really serious matter that deserves the highest priority from the Government, but we are not getting it. When will the Minister give us the answers that the noble Lord, Lord Lexden, is demanding?

[Lord Sharpe of Epsom (Con)]

I hope very soon. The noble Lord is also aware that there are a large number of things that I absolutely cannot say—a point I have reinforced from the Dispatch Box on a number of occasions. That will remain the case until this is concluded.

Police, Crime, Sentencing and Courts Act 2022 (Extraction of information from electronic devices) (Amendment of Schedule 3) Regulations 2023

Lord Sharpe of Epsom Excerpts

Monday 22nd May 2023 Grand Committee

Moved by

[Lord Sharpe of Epsom]

That the Grand Committee do consider the Police, Crime, Sentencing and Courts Act 2022 (Extraction of information from electronic devices) (Amendment of Schedule 3) Regulations 2023.

[The Parliamentary Under-Secretary of State, Home Office (Lord Sharpe of Epsom) (Con)]

My Lords, the extraction of information powers introduced in the Police, Crime, Sentencing and Courts Act 2022 have provided a statutory basis for police and other authorised persons to obtain information from electronic devices to support investigations.

These powers came into force last November, along with a code of practice that provides guidance to authorised persons to ensure that the powers are used appropriately and effectively. They can be exercised by the authorised persons named in Schedule 3 to the Act. This is divided into three parts, which set out the different purposes for which authorised persons may exercise the powers. It is crucial that authorised persons extract information only for the purposes set by the part of the schedule in which they are placed.

At present, the Royal Navy Police, the Royal Military Police and the Royal Air Force Police can extract information only for the purposes set out under Section 37 of the Act:

“preventing, detecting, investigating or prosecuting crime … helping to locate a missing person, or … protecting a child or an at-risk adult from neglect or physical, mental or emotional harm”.

These regulations will amend Schedule 3 so that the Royal Navy Police, the Royal Military Police and the Royal Air Force Police are moved from Part 2 to Part 1 of the schedule. This change will allow these police forces also to extract information from a deceased person’s electronic device, using the power in Section 41, for the purpose of an investigation or inquest into that person’s death.

Electronic devices such as mobile phones contain a wealth of personal information and can be helpful in an investigation when someone has died in unexplained circumstances. Although data protection regulations do not apply to deceased persons, we must still ensure that information extracted from an electronic device where the user of the device has died is handled appropriately and sensitively. Additionally, an electronic device such as a mobile phone or laptop is almost certain to contain information about living people, so the authorised person will still need to be satisfied that extracting such information is necessary and proportionate.

The powers under Section 41 of the Police, Crime, Sentencing and Courts Act 2022, much like the powers under Section 37 of the Act, can be exercised only where the authorised person reasonably believes that there is information on the device that is relevant to the purposes set out under this section—in this case for an investigation or inquest into a person’s death. It is vital that these intrusive powers are available only to the authorities that need them. When the Bill was passed, it was not yet agreed that the Royal Navy Police, the Royal Military Police and the Royal Air Force Police had sufficient investigative requirement to use Section 41 powers or that their investigative needs could not be met with other existing powers.

Having taken time thoroughly to consider their case, we are now in agreement with these police forces that their investigative duties meet the requirements for use of the powers and that, without access to them, there may be a gap in their ability lawfully to extract information in these circumstances. For this reason, we are amending their position in Schedule 3 to ensure that they can investigate the death of a person as thoroughly as possible. This amendment will ensure that the Royal Navy Police, the Royal Military Police and the Royal Air Force Police have the same powers to extract information from electronic devices as civilian forces. It will also provide them with the ability to carry out their investigations as thoroughly as possible by giving them the ability to extract information from a deceased person’s device for the purpose of an investigation or inquest into that person’s death.

I very much hope that noble Lords will support this amendment to Schedule 3 of the Police, Crime, Sentencing and Courts Act 2022. I commend the regulations to the Grand Committee and I beg to move.

[Lord German (LD)]

My Lords, this is a straightforward piece of secondary legislation, adding the Royal Military Police, the Royal Air Force Police and the Royal Navy Police to the list of people who can exercise extraction of information powers under Section 41 of the Police, Crime, Sentencing and Courts Act 2022.

First, I declare what may be a tangential interest: I have a son-in-law who flies jets for the RAF. I would never have thought about it, but it is possible that his and my family would be affected if Section 41 powers were to be used in the event of his untimely death, if that were to happen.

I have two questions to ask the Minister. They relate to the guidance in the extraction of information code of practice, which was provided in relation to the Act and as a result of the words of the Information Commissioner, who believed that this was necessary. I am pleased that it is provided.

My first question relates to paragraph 69 of the guidance, which talks about the use of a mobile phone device “around the time of” the death of the person concerned. It uses the words “the user”. Earlier, in relation to Section 37 of the Act, the code of practice talks about where people are not necessarily the owner of the phone or mobile device. It distinguishes clearly people who own a phone from people who have a phone which is owned by somebody else—something we parliamentarians know because we have a parliamentarian phone that is not our property but is used for all sorts of communication, as well as for the business of Parliament. I do not expect the Minister to have an answer yet, but could there be some clarification of paragraph 69 that refers back to the earlier information given in the code of practice to say exactly what it means about a shared-user phone?

My second question is about paragraph 90 of the code and current practice among police forces to keep up to date with technology in order to separate personal information from necessary information related to the event being investigated—the death, criminal event or whatever. Does the Minister have any information about whether police forces of all sorts are using similar technology? The real problem, which is quite obvious, is that there is a variety of technological options available to police forces and they may all be using different ones. That means that they may not necessarily be able to do what is required in the code of practice and keep up to date with

“the technology options available in their organisations”.

There may be a question here—again, the Minister may not be able to answer it now—about whether the technology available to police forces is of sufficient robustness to allow them to be ahead of the game and whether there is one piece of software that is recommended for police forces to use.

With those two questions, I am perfectly satisfied that this is a sensible piece of legislation.

[Lord Ponsonby of Shulbrede (Lab)]

My Lords, I too am happy to say that this is a straightforward statutory instrument, and we are happy to support it from the Labour Party’s point of view. The SI adds members of the Royal Navy Police, the Royal Military Police and the Royal Air Force Police to those given the power to extract information from a device after a user of that device has died, as part of an investigation or inquest into the death, to investigate crime and to safeguard others.

I think it is fair to ask the Minister why these police forces were left out of the original Bill. Was there a particular reason, or was the consultation process not complete?

The Labour Party tabled a series of amendments to the PCSC Bill creating new checks on police powers to extract data from electronic devices. This was due to concerns about vulnerable people and the intrusive nature of these searches—in particular, for rape and sexual abuse victims, who can feel that requests for information, including digital information taken from their phone, can be overly invasive and collect highly personal information that is not relevant to the inquiry. It may make people more reluctant to come forward to the police if they know that they will get this interrogation of their phones.

I understand that this SI covers something different—cases in which the owner of the device has died—and we are happy to support this amendment. However, I would still like to ask the Minister what assurance he can give about how devices and information taken from them will be handled sensitively so as not to discourage potential victims and witnesses from coming forward.

There have also been serious concerns about digital resources and the use of digital information by the police, outlined in the report last year from His Majesty’s Inspectorate of Constabulary and Fire & Rescue Services. Can the Minister give any update on what action is being taken and whether any specific concerns have been raised about the use of digital items by the forces being given additional powers today? That is a more general question; the two questions raised by the noble Lord, Lord German, are very pertinent, so I shall be interested to hear the Minister’s response on shared-user phones and what impact the measure would have on them, as well as on the interoperability of different technologies and different police forces, as I am sure that that will be a tripping block. I am sure that it is not the intention to create any problems but it is always difficult, in my experience, to get different sources of technology to work together in a seamless way. That seems to be a challenge facing businesses, police forces and everybody battling with new digital technologies. However, overall, we support this SI.

[Lord Sharpe of Epsom (Con)]

My Lords, I thank both noble Lords who have spoken in this very short debate. I shall address all the questions asked of me shortly. Before I do that, I make the general point that the introduction of extraction of information powers in the 2022 Act and its code of practice are just the start of changes being made to improve the experiences of victims involved in the criminal justice system. These specific powers were introduced to ensure that victims and witnesses who report crime can be confident that their personal information will be handled appropriately and that their privacy rights will be respected.

As has been discussed, the amendment relates to the extraction of information from electronic devices when the device user is deceased, so some of the issues debated during the passage of the Police, Crime, Sentencing and Courts Bill are not available there.

The noble Lord, Lord Ponsonby, asked why it was not introduced with regard to these police forces in the original iteration. As I said in my opening remarks, at the time it was not agreed that the Royal Navy Police, the Royal Military Police and the Royal Air Force Police had a sufficient investigative requirement to use Section 41 powers or that their investigative needs could not be met with other existing powers. We have now taken the time thoroughly to consider their case and are in agreement with those police forces that their investigative duties meet the requirements for the use of the powers. In short, it is about ensuring that giving those police forces those powers is indeed the proportionate and correct thing to do, which is why it has taken a little bit of time.

On some of the more technical questions asked of me by the noble Lord, Lord German, there is a broader debate here about whether extraction of information from a personal device is always necessary, given the risks to privacy. Of course, there is a balance to be struck, which must be achieved when undertaking any investigation. All reasonable lines of inquiry must be followed to guarantee a fair trial with the right to privacy. As I said in my opening remarks, it is vital that victims and witnesses feel confident to come forward, but it is equally important that police and other agencies have access to the evidence that they need—I accept that there is no disagreement about this—including mobile data, to fully investigate crime and guarantee a fair trial.

Where information is being extracted from a deceased person’s device, the authorised person must have reasonable belief that the information on that device is relevant to an investigation or inquest into that person’s death, and be satisfied that extracting the information is necessary and proportionate. In answer to the specific question about “the device”—whether it is the owner’s own or one that just happens to be in use—I think it is any device that happens to be in the deceased’s possession. If I am wrong on that, I will of course come back and clarify. By the way, I sincerely hope that it is never a personal matter.

--- Later in debate ---

[Lord German (LD)]

Just to interrupt the Minister for a second, I was asking whether a common set of software is used across police forces.

[Lord Sharpe of Epsom (Con)]

I am coming to that. There is a digital evidence programme, because the Government are determined to address the challenges associated with selectively extracting, analysing and reporting digital evidence gathered in criminal investigations, as we have been discussing.

We are supporting the Police Digital Service with £1.36 million in 2023-24 to undertake work to better understand the challenges in this area and to work with the private sector to develop and test new technologies. The evidence programme has been set up with a wide range of deliverables, including landscape reviews of force capabilities and gaps; creation of a new RASSO tech partnership board, bringing actors across policing together with the private sector—please do not ask me what the acronym RASSO stands for; development and testing of a range of private sector tech products within police forces; and, through the ACE impact lab process, working with technology companies to develop innovative solutions to key RASSO problems. The work is focused on solving the problems that victims experience and the selective extraction, analysis and reporting of digital evidence. It is fairly safe to say that all the questions asked of me by the noble Lord will be covered under that piece of work.

[Lord Ponsonby of Shulbrede (Lab)]

I am sorry to interrupt the Minister again, but the acronym RASSO stands for rape and serious sexual offences.

[Lord Sharpe of Epsom (Con)]

I thank the noble Lord very much for that.

On the progress being made on recommendation 5 of the HMICFRS report, which relates to budgets and the funding of digital forensics, we have also set up a commissioning board, jointly led by policing and the Home Office, to enable joint decision-making around prioritisation and to increase the transparency of funding decisions, including those in digital forensics, in line with that recommendation. In addition, we are investing £11 million into providing forces with technology that will enhance their capability to carry out rape investigations quickly and to provide a better service to victims.

I thank noble Lords very much for their questions. I hope I have answered them; I think I have. In closing, I repeat my thanks for the time taken to discuss and consider these issues. I once again commend the regulations to the Committee.

Motion agreed.

Equipment Theft (Prevention) Bill

Lord Sharpe of Epsom Excerpts

2nd reading
Friday 19th May 2023 Lords Chamber

[The Parliamentary Under-Secretary of State, Home Office (Lord Sharpe of Epsom) (Con)]

My Lords, I am grateful to my noble friend Lord Blencathra for bringing forward this Private Member’s Bill to the House. I join him in paying tribute to Greg Smith MP in the other place for all his work on it. I also commend him on the eloquent and considered case he has made for the included measures and thank all those who contributed to this short debate and welcome their support.

I am delighted to be able to say that the Government support this Bill. As has been noted, it received cross-party support from the outset. My noble friend Lord Wasserman is quite right that the Government are determined to make our cities, towns, villages and rural areas safer. Our blueprint for cutting crime was set out in the Beating Crime Plan in July 2021, which outlined the concerted and wide-ranging actions we are taking to cut crime and make our society a safer place to live and work in.

To bear down on all forms of crime, this Government committed to recruiting an additional 20,000 officers across England and Wales by the end of March 2023. We have delivered on this manifesto commitment; 20,951 additional officers were recruited by the end of March 2023. A record number of officers are now in post, bringing the total number to nearly 150,000 across England and Wales, exceeding the previous peak in 2010 by 3,500. This means that there are now more police on the streets to tackle crime in all areas of England and Wales. That includes crime affecting rural communities, such as machinery theft, which this Bill is designed to prevent.

As all noble Lords have noted, the theft of agricultural machinery, in particular all-terrain vehicles, is of great concern. The Government recognise the significant impact of these thefts on both individuals and businesses and understand the distress and disruption caused when property is stolen. For example, the theft of an agricultural vehicle from a farmer can cause severe disruption to essential cultivation work, risk animal welfare and put livelihoods on the line. It is therefore essential to ensure that they are adequately protected. I was pleased to hear my noble friend Lord Blencathra describe the widespread support for this Bill from interested parties, including the National Farmers’ Union and NFU Mutual. The principle of this Bill is very important: the Government expect manufacturers to play their part in protecting items from theft.

As well as the personal and practical consequences, there is a significant economic impact, as noted by the noble Baroness, Lady Twycross. As we heard during this debate, more than 900 quad bikes and ATVs are stolen every year. NFU Mutual’s Rural Crime Report 2022 put the total cost of insurance claims due to the theft of agricultural vehicles at £9.1 million last year. This figure includes more than ATVs; we know that other high-value machinery such as tractors and GPS systems are also targeted by organised criminal gangs. Of that £9.1 million, the theft of quad bikes and ATVs alone costs the UK £2.2 million. This is an unacceptably high amount.

To go into a little more detail on other types of machinery theft, figures provided by the National Police Chiefs’ Council show that there has been a total of 626 thefts of large agricultural machinery so far in 2023. These figures include large or high-value machines such as tractors, excavators and diggers. In reply to the noble Baroness, Lady Randerson, the most I can do to clarify “large” here is to say that it means “big”.

This is why the Government are taking action by supporting this Bill. Despite significant technological advancements made across the ATV market, the inclusion of basic security features on machines has been much slower. Fitting immobilisers and forensic markings as standard is inexpensive, and they are readily available. The Government do not wish unnecessarily to impose additional costs on individuals. The cost of fitting an immobiliser and forensically marking a machine is estimated to be under £200. This cost is far outweighed by the benefit of reducing disruption caused by theft.

The Government are focused on the prevention of crime. As we have heard during this debate, increased policing is not the only answer. Prevention is by far the most effective means of reducing these thefts and this Bill proposes simple action to achieve that. We need the most effective technology, such as immobilisers and forensic marking, to be rolled out and fitted as standard to drive down these preventable thefts.

My noble friend Lord Blencathra asked about databases. The Government have no intention of creating a single national database for the purpose of recording and retaining this information. The owner’s information will be registered on the database maintained by the company whose forensic marking product has been used. For example, many companies, such as CESAR—which has been mentioned and I will come back to—Datatag, Selectamark and SmartWater operate databases to record forensic marking and owners’ details.

In answer to the noble Baronesses, Lady Randerson and Lady Bakewell, the Explanatory Notes refer to CESAR as an example of a forensic marking scheme. The legislation, to be clear, will not endorse any particular product, product line or service. A number of forensic marking schemes are already widely adopted by the agricultural sector and construction industry. The secondary legislation will specify the standards of forensic marking which may be used—in order to set a minimum standard, not to restrict the market or stifle innovation. I should also be clear that police officers are very aware of how to search for any stolen items using these databases. They are able to access these databases at any time in order to ascertain if they are dealing with things such as stolen ATVs.

The Government expect to see a real decrease in the theft of ATVs as a result of the measures in this Bill. The introduction of immobilisers and forensic marking as standard will help prevent them being stolen. Importantly, it will be harder for criminals to sell on stolen machinery, and that will have a deterrent effect. The Bill is a great example of government, law enforcement and industry working together to protect hard-working people from theft.

The Bill includes a power for the Secretary of State to extend its provisions via secondary legislation to other types of machinery, as has been noted. During the Commons stages, the Minister for Crime, Policing and Fire committed to consider extending the provisions to other equipment designed or adapted primarily for use in agricultural or commercial activities, including tradespeople’s tools. Minister Philp recognised that the regulations would require careful consideration to ensure the technical detail is correct. The legislation must be practical and straightforward for manufacturers and dealers to implement, without causing a detrimental impact on businesses.

My noble friend asked about calls for evidence. I am very pleased, as has been noted by the noble Baroness, Lady Randerson, that the call for evidence was launched this week. It has been published on GOV.UK and will run for eight weeks. I am not sure why it is unfortunate that it was introduced only this week. Home Office officials will ensure that it is widely shared with those who may be affected by the legislation. That includes manufacturers, dealers, retailers, forensic marking companies, trade associations, tradespeople and law enforcement practitioners. I urge all interested parties to engage with this call for evidence and make their feelings and opinions known.

I have also been lobbied by the National Caravan Council, which should definitely engage with this, as should the Agricultural Engineers Association and others. The call for evidence includes questions about the feasibility of including handheld power tools and large agricultural equipment in the secondary legislation. We recognise that there is an overlap between equipment used in the agriculture, construction and land management industries, but we want to ensure that the legislation covers equipment that is vulnerable to theft and needs to be protected.

The Bill is broad in scope. It allows for these requirements to be extended to other equipment, as we have discussed, via secondary legislation. That is why this call for evidence is so important to engage with—to make sure, as I think has been noted, that we do not end up with unintended consequences.

The noble Baroness, Lady Bakewell, asked me about vehicle identification numbers. The fact is that criminals are very adept at changing a quad bike’s identity to legitimise it for resale. In most instances, the VIN is replaced by false or cloned details, which can be harder to detect.

Regarding the forensic marking of tradespeople’s tools, as has been noted, the Minister for Crime, Policing and Fire, Chris Philp, committed to consulting on that. Again, the appropriate way of consulting is through the call for evidence. I actively encourage all relevant stakeholders and interested parties to participate in the call for evidence.

I finish by reiterating my thanks to the noble Lord, Lord Blencathra, for bringing this Private Member’s Bill to the House. I echo the thanks to the National Farmers’ Union and to the National Police Chiefs’ Council lead for construction and agricultural machinery theft, Superintendent Andy Huddleston, for all his work in developing the measures in the Bill. I hope to see the Bill receive Royal Assent, as I believe it can have a significant impact on these thefts; the Government are in full support of it.

Vagrancy Act 1824

Lord Sharpe of Epsom Excerpts

Wednesday 17th May 2023 Lords Chamber

[Baroness Kennedy of Cradley]

To ask His Majesty’s Government when they expect to commence the relevant provisions in the Police, Crime, Sentencing and Courts Act 2022 that repeal the Vagrancy Act 1824.

[The Parliamentary Under-Secretary of State, Home Office (Lord Sharpe of Epsom) (Con)]

My Lords, as we made clear at the time of the PCSC Act and as was recently set out in the Government’s Anti-Social Behaviour Action Plan, we will repeal the Vagrancy Act when suitable replacement legislation is brought forward. This will be done at the earliest parliamentary opportunity.

[Baroness Kennedy of Cradley (Non-Afl)]

My Lords, the delay in commencing the repeal of the Vagrancy Act has left this matter unresolved for more than a year. In that time, more than 1,000 vulnerable people have been arrested under its provisions. The plans the Minister refers to recriminalise homelessness through new anti-social behaviour legislation and are contrary to the principles established in the Government’s rough sleeping initiative. That is, in effect, the Vagrancy Act by the back door. When will the Government move past criminalisation as a response to homelessness and offer genuine, workable support measures? When will they finally repeal the Vagrancy Act?

[Lord Sharpe of Epsom (Con)]

My Lords, at the start of the year the Home Office was asked to take forward provisions to repeal and replace the Vagrancy Act, as the noble Baroness has referred to. That builds on the Lords amendment to the PCSC Act 2022 to repeal the Vagrancy Act once replacement offences have been considered. That amendment received support across parties in both the Lords and the Commons. The Department for Levelling Up, Housing and Communities remains the policy lead on homelessness and rough sleeping. We are working closely with that department to determine the replacement legislation. That legislation is not ready yet. An extensive action plan for anti-social behaviour has been published, which goes into significant mitigations for homelessness. As soon as parliamentary time allows, we will do this.

[Lord Bird (CB)]

My Lords, between 1964 and 1969 capital punishment was not used. It was allowed to fall into non-use. Could we do the same with the Vagrancy Act, which is one of the most heinous crimes because it turns homeless people into criminals?

[Lord Sharpe of Epsom (Con)]

My Lords, the Government do not collect figures on the police usage of the Vagrancy Act and as the police are operationally independent, we cannot comment on figures. The Ministry of Justice figures on prosecution show that it is a very small number of people. There were four prosecutions for sleeping out in 2021 and 459 prosecutions for begging in 2021.

[Lord German (LD)]

My Lords, this is a very important piece of legislation which the Government are seeking to provide. Can the Minister give us an assurance that the Bill, or whatever the legislation is, will be delivered and completed by the next general election?

[Lord Sharpe of Epsom (Con)]

I cannot give that assurance but, as I said, last year we consulted on options for replacement legislation, along with other stakeholder engagement, and we are considering those complex issues carefully. The Government will publish responses to the Vagrancy Act consultation in due course. As soon as parliamentary time allows, that legislation will appear in front of your Lordships.

[Baroness Chakrabarti (Lab)]

My Lords, what is the Government’s approach to commencement orders more generally? There was an engagement in your Lordships’ House last week about the non-commencement of journalists’ protection in the Public Order Act. Do the Minister and the Government understand that to delay commencement indefinitely, and thus to thwart the will of Parliament, is an unlawful abuse of power?

[Lord Sharpe of Epsom (Con)]

Of course, commencement is not really within the spirit of the Question, but I understand where the noble Baroness is coming from. There was no suggestion that commencement would be delayed indefinitely under the circumstances to which she refers.

[Lord Best (CB)]

My Lords, the various charities which campaigned for this change, led by Crisis, were deeply grateful for the amendment your Lordships passed which led to this legislative change. But a year on from the Government agreeing to legislate accordingly, we do not have that commencement. We do have the Anti-Social Behaviour Action Plan, which seems to be mostly about a rather penal attitude towards people begging. It does contain some positive comments about new powers—I am not sure whether there will be new money too—to help people who are currently homeless and in need of extra support. Can we hear a little more about the positive aspects of what the Government are attempting to do? In the meantime, can we abolish this piece of legislation before its 200th anniversary?

[Lord Sharpe of Epsom (Con)]

I am happy to give a bit more detail on the positive aspects of this. So far, we have invested up to £500 million through our flagship rough sleeping initiative 2022-25 so that local authorities can provide tailored support to end rough sleeping. We have launched the £200 million single homelessness accommodation programme, which will deliver up to 2,400 homes for vulnerable people sleeping rough or at risk of rough sleeping. In addition to the 6,000 homes being delivered by rough sleeping accommodation programmes, we have committed £42 million of funding since 2018 towards the subregional Housing First pilots in various regions. We have also committed up to £186.5 million in funding for substance misuse treatment services.

[The Lord Bishop of Gloucester]

My Lords, I thank the Minister for those statistics and for his assurance of an eventual commitment to no one being criminalised simply for having nowhere to live. Is he aware of the Ministry of Justice data which shows that people released from prison to homelessness are over 50% more likely to offend within a year? What more is being done to ensure that prison leavers have a home on release?

[Lord Sharpe of Epsom (Con)]

I cannot specifically answer as regards all prison leavers. I know that a lot of work is being done with the rehabilitation of drug addicts in an effort to prevent recidivism. I will come back to the right reverend Prelate with more detail, if I can find it.

[Lord Ponsonby of Shulbrede (Lab)]

My Lords, the 1824 Act makes reference to “idle and disorderly” persons, “rogues and vagabonds”. I would be grateful if the Minister could confirm that this is not a reference to Conservative Peers. The 2019 manifesto committed the party opposite to ending rough sleeping by 2024, yet it continues to rise. It is up by 74% in the last 10 years and may be up by a quarter in the last year. What do the Government intend to do to reverse this trend?

[Lord Sharpe of Epsom (Con)]

The noble Lord is a magistrate. I will not comment on his first point, other to say that I am sure most of my colleagues would prefer not to appear in front of him. The statistics he gives are not quite as bad as he made them sound. The numbers are much lower than when homelessness peaked in 2017. Although there was a slight spike last year, they are significantly below previous peak levels.

[Lord Watts (Lab)]

My Lords, is it not a bit rough for the Government to massively increase the number of homeless people in this country and then do nothing to stop them being arrested?

--- Later in debate ---

[Lord Sharpe of Epsom (Con)]

I think I have already answered questions around this particular line of inquiry.

[Lord Shipley (LD)]

My Lords, I have listened carefully to the Minister’s replies to all the questions so far. I am still none the wiser as to why the Government are not delivering the repeal of the Vagrancy Act. It should have been repealed. I do not understand what is stopping the Government moving forward.

[Lord Sharpe of Epsom (Con)]

My Lords, as noble Lords know and as I have tried to explain, we are hard at work on coming up with a suitable replacement, which is not a like-for-like replacement of the Vagrancy Act in its current form. But it is right that the police, local authorities and so on have the tools that they need to respond effectively to begging and rough sleeping. That work is ongoing.

[Lord Grocott (Lab)]

My Lords, the Minister said two or three times that one of the factors is as soon as parliamentary time becomes available. We are already in an inordinately long Session, with no date yet announced for when it will end and when the King’s Speech will be. So is it not a pretty lame excuse to say that it is just a matter of finding parliamentary time? What we really need to see is the Government getting their act together.

[Lord Sharpe of Epsom (Con)]

I shall pass on the noble Lord’s comments.

[Lord Kamall (Con)]

My noble friend the Minister said that it is important to think about what could possibly replace the Vagrancy Act. Could he enlighten us about the thinking on why there needs to be a replacement, rather than purely repealing it?

[Lord Sharpe of Epsom (Con)]

It is felt that certain other types of activity associated with vagrancy should be looked into, including things such as nuisance and organised begging.

[Lord Baker of Dorking (Con)]

My Lords, is the Minister aware that the Vagrancy Act 1824 was introduced because many soldiers who had fought in the Napoleonic Wars had no employment and resorted to begging? As far as I know, from our recent war in Iraq, no vagrants are now begging. Does the Minister not think that he ought to catch up with what has happened in the last 200 years?

[Lord Sharpe of Epsom (Con)]

I thank my noble friend for the history lesson.

[Lord Hunt of Kings Heath (Lab)]

My Lords, can the Minister explain why the Government need to spend an inordinate amount of time looking at what to replace the Vagrancy Act with, having said that they will rescind it? Why will they not spend a similar amount of time on EU regulations?

[Lord Sharpe of Epsom (Con)]

That is well beyond the scope of this Question, but I am sure that everyone will have heard the noble Lord’s point.

National Crime Agency Investigation: Javad Marandi

Lord Sharpe of Epsom Excerpts

Wednesday 17th May 2023 Lords Chamber

[Lord Coaker (Lab)]

My Lords, the National Crime Agency investigation into the Azerbaijan laundromat is extremely serious, with an alleged $2.9 billion in stolen money laundered through UK companies. An individual with alleged links to this is also being investigated—an individual who gave three-quarters of a million pounds to the Conservative Party and who got an OBE and access to government Ministers. Can the Minister confirm whether this is accurate? In the other place, the Minister said that the National Security Bill is to be considered again in the Lords on ping-pong, as we know, and we may see it return to us. In the light of this investigation, what amendments are the Government going to support in the Lords, or what amendments are they going to bring forward themselves, in order to deal with this and ensure that we all have confidence that there is no dirty money in our politics and that this issue will be addressed at last?

[The Parliamentary Under-Secretary of State, Home Office (Lord Sharpe of Epsom) (Con)]

The noble Lord will be aware that I cannot comment on ongoing investigations; no Minister at the Dispatch Box would. With regard to Mr Marandi’s status in the United Kingdom, he is a citizen of this country, as I am sure the noble Lord is aware, and his honours and so on are a matter of public record. As for political donations, UK electoral law already sets out a robust regime of donations and controls to ensure that only those with a legitimate interest in UK elections can make political donations, and that political donations are transparent. It is an offence to attempt to evade the rules on donations by concealing information, giving false information, or knowingly facilitating the making of an impermissible donation. I think this structure is pretty robust already, and a large number of various Bills, strategies and so on have recently been published which contribute to this debate.

[Lord German (LD)]

My Lords, all political parties have had problems with political donations. For that reason, the Liberal Democrats have put in place a stringent, robust system to protect our integrity. I think the Minister was referring to an Answer given by the Minister in the House of Commons, when he said that our

“electoral law sets out a stringent regime of donation controls”.—[Official Report, Commons, 16/5/23; col. 701.]

Manifestly, it does not do that. It specifies who can give donations but not where that money might come from. So far from being stringent, there is now a danger that laundered money may have been introduced into our democratic processes. If the system is as stringent as the Government make out, how was it possible for the Conservative Party to accept donations from this individual while the laundromat investigation was ongoing?

[Lord Sharpe of Epsom (Con)]

My Lords, I am going to repeat what I have said: there is a long-standing principle, first introduced by the Committee on Standards in Public Life in 1998, that if you are eligible to vote for a party in an election, you are also eligible to donate to that party. That includes overseas electors, as noble Lords will be aware, with reference to the Elections Act. Coming back to that Act, I remind the House that the Government have already taken significant steps to strengthen the integrity of our elections and update our electoral law. This was done to ensure that our democracy remains secure, modern, transparent and fair. I could go on in considerable detail about the Elections Act, but it has been much debated in this House.

[Lord Carlile of Berriew (CB)]

Is not the case referred to in this Question an illustration of the opacity, rather than transparency, of the financial system relating to political parties? Is it not very important that we should put all protections in place to ensure that political parties have a well-understood and common system of ensuring that donations, in particular those emanating from foreign powers, are dealt with in a proper way? In those circumstances, would the Minister agree to meet me to discuss the amendment in lieu—replacing Lords Amendment 22—which I tabled last Friday for the next stage of the National Security Bill?

[Lord Sharpe of Epsom (Con)]

I would be very happy indeed to meet the noble Lord to discuss his amendment. I remind noble Lords that, as I say, any suspected breaches of the law are a matter for the Electoral Commission or the police. It is not appropriate to comment on individual cases or ongoing investigations, but if a donation is from a permissible donor, it is for the recipient to decide whether or not they want to accept that donation.

[Lord Browne of Ladyton (Lab)]

My Lords, the Minister will be aware of Operation Branchform, the Scottish police investigation into the finances of the Scottish National Party. What he will not be aware of is that earlier today, Alexander Burnett, the Conservative Whip in the Scottish Parliament, wrote to the Presiding Officer demanding a parliamentary inquiry into that while that investigation is going on. In a published statement, he said that such a new committee would

“give the public confidence that the whole truth around this increasingly murky affair involving Scotland’s ruling party will be laid bare once and for all”.

What advice would the Minister give his parliamentary colleague, who speaks for the party: that maybe he should have removed the plank from his own eye before suggesting that, or that this is a good idea, and what is sauce for the goose is sauce for the gander?

[Lord Sharpe of Epsom (Con)]

The noble Lord will not be surprised to know that I was not aware of the Scottish dimension to this subject, so I will refrain from further comment.

[Lord Evans of Weardale (CB)]

My Lords, I declare an interest as the chair of the Committee on Standards in Public Life, and I am grateful to the Minister for his reference to the report made by my predecessors in 1998. I draw the Minister’s attention to a 2021 report, made by that same committee, which looked at electoral finance. The Minister may remember that the committee made a number of recommendations for reinforcing the provisions to ensure that improper funds were not coming into the electoral system, and it is a cause of great regret to myself and the committee that the Government decided not to take forward any of those recommendations. In the light of the most recent suggestions that there are problems, might the Government wish to revisit that decision and take into consideration more positively the recommendations of the independent and cross-party Committee on Standards in Public Life?

[Lord Sharpe of Epsom (Con)]

My Lords, the Government responded to the report published by the noble Lord’s committee, Regulating Election Finance, in September 2021, and the Elections Act 2022, to which I have already referred, contains measures which closely link to recommendations made in the report; for example, the new requirement on political parties to declare their assets and liabilities over £500 on registration, and a restriction of third-party campaigning to UK-based or otherwise eligible campaigners. The Government have stated that the recommendations in the report deserve full consideration, electoral law is complex, and more work is required to consider the implications and practicalities.

[Lord Forsyth of Drumlean (Con)]

Just to follow on from that question from the noble Lord, Lord Evans, does my noble friend accept that all organisations, however properly conducted, can find themselves in difficulty over the money laundering regulations—as, for example, happened with HSBC, of which the noble Lord, Lord Evans, was a director?

[Lord Sharpe of Epsom (Con)]

Yes; I absolutely accept my noble friend’s point. Certainly, in relation to the question that has been asked, it is incumbent on all parties to be vigilant about all donations at all times.

[Lord Wallace of Saltaire (LD)]

My Lords, I am sure that the Minister shares the general concern about maintaining public confidence in the integrity of our electoral process, including political finance. He must be aware that there have been persistent rumours, with a good deal of circumstantial evidence, that there have been flows of money indirectly from the Russian state into Conservative Party funds. So long as that suspicion is maintained and we do not have transparency about what really happened, there will be questions about the integrity of our political process. Should the Government not ensure that there is full transparency about these various reports and publish some of the redacted parts of the ISC’s Russia report?

[Lord Sharpe of Epsom (Con)]

My Lords, we have gone back and forth on this issue on a number of occasions. The noble Lord refers to rumours, but he is prone to starting some. I remind the noble Lord that, as my right honourable friend the Policing Minister pointed out in the other place, an MP from the noble Lord’s party in the other place accepted sizeable donations from somebody who was later identified by MI5 as a foreign agent. Those in glass houses.

[Lord Watts (Lab)]

My Lords, it would be more effective if the political parties had to repay that money. That might be an incentive not to accept money that we think is dodgy.

[Lord Sharpe of Epsom (Con)]

My Lords, I do not believe that was a question.

Licensing Act 2003 (Liaison Committee Report)

Lord Sharpe of Epsom Excerpts

Wednesday 17th May 2023 Grand Committee

[The Parliamentary Under-Secretary of State, Home Office (Lord Sharpe of Epsom) (Con)]

My Lords, I start by congratulating my noble friend Lady McIntosh of Pickering on securing this important debate. I am very well aware of her long-standing interest in this topic. I also thank all noble Lords who have participated for their contributions. I echo the noble Lord, Lord Ponsonby, in agreeing with my noble friend Lord Smith that the vast majority of people enjoy responsible drinking, and I reassure the noble Baroness, Lady Walmsley, that I often drink with great joy and will do very soon, I hope.

The Government recognise that the majority of people drink responsibly and enjoy alcohol as part of socialising, as has been noted, but we also recognise the significant contribution that the alcohol industry makes to the economy and the job market, as all noble Lords mentioned.

Despite some encouraging trends, we know that the harms associated with alcohol remain too high. Appropriate regulation is therefore essential. We believe that the Licensing Act sets out a clear and effective national framework for regulating licensable activities, while allowing considerable local autonomy. It strikes the right balance between providing safeguards to prevent nuisance, crime and disorder, while recognising the important contribution that licensed premises make to thriving night-time economies. Having said all that, we keep the Act under review to ensure that the regime remains fit for purpose and meets emerging challenges. We work closely with licensing practitioners and the alcohol industry to achieve this.

As your Lordships are aware, in 2017 a House of Lords Select Committee carried out post-legislative scrutiny of the Act. Last year the House of Lords Liaison Committee carried out further scrutiny, so I offer my thanks to everyone involved in that work. The Government have carefully considered the recommendations that the Liaison Committee made in its detailed and thoughtful report last year, and I will update your Lordships on work that the Government have been doing in connection with the reports.

Since the publication of the original report in 2017, the Government have worked to reinforce expectations that licensing and planning should work effectively together. The then Minister for Crime and Policing wrote to licensing authorities to reinforce this expectation. We held workshops and published a revision of the Section 182 guidance, making mention of the relationship between licensing and planning systems. I will come back to both of those things.

In response to the Select Committee’s original recommendation to extend all provisions of the Licensing Act 2003 to airside premises, the Government held a call for evidence, because we of course agree that disruptive incidents caused by excessive alcohol consumption at airports or on aeroplanes are unacceptable. However, as noted in the Government’s response to the call for evidence published in December 2021, the information and evidence submitted did not make a compelling case for extending the provisions. We therefore do not intend to revisit that decision. We were impressed with the information provided following the call for evidence on the voluntary measures already under way by airside premises and airport authorities.

The Liaison Committee expressed concern that removing the GOV.UK licence application system without a replacement system being in place would cause significant difficulties. The Government agree. Your Lordships will be pleased to know that the Cabinet Office has extended the provision of the licensing service for two years, until the end of March 2025. The Government Digital Service will continue to support the online licensing service during this period and is working closely with government departments with an interest in this service. It is exploring options for a long-term solution that meets the needs of licensing authorities and users. At the same time, it is exploring options for a register of licence holders.

I will get into some of the specific points that have been raised, with perhaps a little more detail on one or two of the things that I have already mentioned. With regard to co-ordination between licensing and planning, the Levelling-up and Regeneration Bill will, as has been noted, modernise our planning system and put local people in charge of it, so that it delivers more of what communities want. The Government acknowledge that co-ordination between planning and licensing is important. Planning authorities are involved in licensing applications in their role as a responsible authority under the Licensing Act, but the systems are separate and have different objectives and approaches. The powers are there to enable planning and licensing to work together to support the needs and aspirations of local communities. We do not intend to introduce an additional mechanism.

My noble friend Lady McIntosh made very considered and useful points, particularly regarding agents of change, but these relate to planning rather than the Licensing Act, which is the regime under discussion today. Our response, to both the original report and the subsequent follow-up, has set out our commitment to working with partners to support efforts to improve how these systems work together on the ground. We continue to do that, building on our previous workshops and the clear expectations set out by previous Ministers in this regard. I will obviously share the detailed points my noble friend has made with the relevant department. As she will be aware, the Levelling-up and Regeneration Bill, as I have said, will modernise our planning system and put local people in charge, so I will certainly take back the points that have been made on that.

I think the word “ambiguity” was used with regard to words such as “effective” and “unreasonable”. As signalled by the December 2022 consultation on reforms to national planning policy, the Government will undertake a full consultation on a revised National Planning Policy Framework and proposals for national development management policies once the Levelling-up and Regeneration Bill has completed its passage through Parliament. The Government agree, as I have said, that co-ordination between the planning and licensing regimes is crucial to protect these businesses in practice. That is why, in December 2022, the Home Office published a revised version of the guidance under Section 182—which I have already referred to—of the Licensing Act 2003, cross-referencing the relevant section of the National Planning Policy Framework for the first time. Combined with our wider changes in the Levelling-up and Regeneration Bill, we will make sure that our policy results in better protections for affected businesses and delivers on the agent of change principle in practice.

As regards planning balance, we recognise that raising awareness of this principle, how it can be applied and how it should work in practice are vital in ensuring that the two systems work together at a local level. We will therefore continue to work together with key partners and experts in this area and will continue to hold detailed discussions with them in a workshop setting in June. These discussions will inform what more we can do to further strengthen the licensing guidance, as well as asking practitioners directly what they would find helpful from us.

To go back to the words “effective”, “suitable”, and “unreasonable” being potentially ambiguous, these terms appear frequently in legislation and accompanying guidance. Obviously, circumstances will be different in every case; no law could precisely prescribe what should or must happen in every case. It is for Parliament to legislate to set out the principles, which are applied very much on a case-by-case basis.

My noble friend Lord Smith and others referred to the late-night levy. I am very pleased to say that the Government have delivered their commitment to consult on the level of late-night levy to be applied to late-night refreshment premises. The majority of respondents to the consultation were in favour of local authorities having the option to offer a 30% reduction to late night refreshment providers that qualify for small business rate relief. This reduction is already available in relation to premises that supply alcohol for consumption on the premises.

Now that the consultation is complete, we plan to commence the wider changes made via the Policing and Crime Act 2017 intended to make the levy more flexible for local areas, fairer to business and more transparent. We will continue to collect data on the number of areas introducing a levy via the alcohol and late-night refreshment statistical bulletin.

The night-time economy is obviously incredibly important to the nation and to a number of businesses, but we also continue to take action to improve the safety of women at night, tackle drink-spiking in licensed premises and work with partners to reduce incidents of violence in the night-time economy. To support that work further, we are working with policing and licensing partners to reduce alcohol-related offending in the night-time economy, focusing on sharing good practice, exploring innovative approaches and maximising the use of existing licensing powers.

This leads neatly on to the subject of training, as mentioned by the noble Lord, Lord Ponsonby, and my noble friends Lady McIntosh and Lord Smith. Obviously, we recognise the importance of training for those involved in licensing work at every level. We continue to work closely with the Institute of Licensing and the Local Government Association to ensure that training resources are used widely and consistently, and to explore whether any additional signposting could be included in the Section 182 guidance. I am pleased to say that we will be holding a joint workshop on this issue in June, as I have already mentioned.

The police contribute to licensing decisions and can object to licence applications. In addition, the National Police Chiefs’ Council—the NPCC—remains committed to delivering a training package to all police licensing officers to improve standards and deliver a consistent approach. The NPCC lead for alcohol licensing and harm reduction, Deputy Chief Constable Scott Green of West Midlands Police, is overseeing this programme of work, working with Home Office officials, policing partners and representatives of the hospitality industry to ensure that the training meets the standards of all interested parties.

Noble Lords—among others, my noble friend Lord Holmes, the noble Baroness, Lady Walmsley, the noble Lord, Lord Ponsonby—have brought up the subject of access to licensed premises for disabled people. The Licensing Act regulates the sale of alcohol and should not be used to control other aspects of licensed premises as this is outside the scope of the licensing regime. The Equality Act 2010 already provides robust protections for disabled people who may encounter difficulties in accessing licensed premises.

Pubs, bars and restaurants are under a duty to make reasonable adjustments to enable disabled customers to use their premises and facilities. It is not, however, consistent with how the Equality Act is intended to work for it to set specific accessibility standards for particular industries, nor would such arrangements be workable for obvious reasons. However, we have committed to reviewing Part M of the Building Regulations. As part of our review, we have commissioned research to support it; we will publish this in due course.

I say to the noble Lord, Lord Ponsonby, and the noble Baroness, Lady Walmsley, that I would hope that all premises would strive to be as inclusive as possible. I would certainly take that into account when making personal decisions on where to visit, as I am sure the vast majority of responsible drinkers would.

The noble Lord, Lord Holmes, asked about the consultation period for licensing applications. This is being discussed as part of the levelling up Bill. There is obviously a balance to be struck between ensuring the appropriate time for consultation and helping the licensed sector. Of course, the licensed sector has suffered greatly during the pandemic, as has been noted. It is still in somewhat straitened circumstances.

Regarding minimum unit pricing, after the publication of the 2012 strategy, the then Government carried out a consultation on minimum unit pricing. The evidence was not conclusive. However, Members will be aware that MUP was the subject of a lengthy court case before subsequently being introduced in Scotland and, later, in Wales. The Government are keen to see the full findings from the formal evaluation by the Scottish Government, which we are expecting in June. We will consider those findings and report back in due course. I believe that that is the five year anniversary of the minimum unit pricing experiment in Scotland.

As the noble Baroness, Lady Walmsley, pointed out, we need to be very careful with things of this sort. It seems to me, from a common-sense point of view, that this sort of process could very easily end up being a tax on the poor, which I am sure we would all rather avoid.

On wider issues, the Government are working on tackling alcohol-related harms. Preventing these requires a sustained commitment from government, local authorities, the police, health partners and businesses. There is no easy answer to tackling alcohol-related harms: all parts of the system have to work together, including early identification and intervention, treatment access and criminal justice powers. We have an ambitious programme of work in train across departments to tackle these harms.

My noble friend Lord Holmes asked about digital ID. There are currently no plans to introduce digital age verification for alcohol sales, but we are exploring what is permissible within the Licensing Act and whether the legislation should be amended. We also plan to consult on this over the next few months.

Alcohol is a recognised driver of crime, as has been noted by all noble Lords, and can adversely impact individuals, communities and services. We have seen some encouraging trends over the last few years. For example, members of the public perceiving people being drunk or rowdy as a problem in their local area nearly halved between 2009-10 and 2019-20.

Despite a reduction in alcohol-related violence over the last decade, around four in 10 violent incidents are alcohol related. This is also the case in around a third of domestic violence incidents. When thinking about their latest incident of serious sexual assault experienced, 39% of victims believed the perpetrator to be under the influence of alcohol. This increased to 49% when the incident occurred between strangers.

Work is of course under way across government to tackle alcohol-related crime. As I have said, we have focussed on equipping the police and local authorities with the right powers to take effective action. We continue to take action to improve the safety of women at night, tackle drink spiking in licensed premises and work with partners to reduce these incidents in the night-time economy.

The noble Lord, Lord Ponsonby, asked about the new group on alcohol-related crime and homicide, which brings together the police and other key players. It has been established and has already held its first meeting. Beyond that, I am afraid that I do not have very much information. As and when I find more, I will make sure to share it with him.

I think that I have answered all the questions. Again, I thank my noble friend for securing this debate and all noble Lords who have contributed. We all agree that there is more to do, but I hope that I have provided reassurance that progress is being made to address the recommendations in the report and that some of the work has already concluded. The Government recognise the importance of these issues. I look forward to continued engagement and discussion on them.

Coronation: Policing

Lord Sharpe of Epsom Excerpts

Thursday 11th May 2023 Lords Chamber

[Lord Harris of Haringey (Lab)]

My Lords, I refer to my policing interests in the register and beg leave to ask the Question standing in my name on the Order Paper—which of course was submitted before the decision on yesterday’s UQ was made.

[The Parliamentary Under-Secretary of State, Home Office (Lord Sharpe of Epsom) (Con)]

My Lords, the policing of the Coronation was a tremendous success. The event passed off without incident and tens of thousands of people were able to witness it, while hundreds who do not support a monarchy were able to express their views. I am grateful for the opportunity once again to pay tribute to the police, volunteers, staff, military and everybody else who was involved in delivering such a momentous day on behalf of the nation.

[Lord Harris of Haringey (Lab)]

My Lords, I would want to be associated with precisely that tribute, as I think would all the Members who spoke yesterday in the UQ. I think the Minister said to us yesterday that some 600 people had been arrested under the Public Order Act.

[Lord Sharpe of Epsom (Con)]

Sixty-four.

[Lord Harris of Haringey (Lab)]

The Minister corrects the figure. I am sure I listened, but it does not really matter. My point remains this: one of those who was arrested was a 59 year-old woman volunteering for Night Stars, which is run by Westminster City Council, providing slippers, vomit bags and rape alarms for vulnerable women coming out of nightclubs. She was arrested in the early hours of Saturday morning and held for 14 hours. I suggest that this sort of incident—I am not privy to the sort of intelligence that the Metropolitan Police may have had—suggests that we need to look at how the powers, which were highly criticised in this House, are used in practice. Will the Minister ask the Home Office to ask His Majesty’s Inspectorate of Constabulary to look at all the cases of people arrested and charged under the new Public Order Act—not just at the Coronation but over the next few months—so that this can be reported publicly, we can see whether the actions were proportionate and appropriate and whether new guidance needs to be issued or the law itself needs to be tweaked?

--- Later in debate ---

[Lord Sharpe of Epsom (Con)]

There were a number of questions there and I will go into the detail. There were 64 arrests. Only six were under the new powers in the Public Order Act, all of which were under Section 2, which is about locking on. Regarding the specific case the noble Lord referred to, and in particular rape alarms, as I mentioned yesterday at the Dispatch Box, there was serious intelligence that was enough to disturb the military—it provoked a call between the Metropolitan Police Commissioner, the Home Secretary and the mayor quite late on Friday night—suggesting that rape alarms would be used in an effort to cause disruption to the procession. That may have included disturbing horses, which were on display in large numbers. I will not comment on the operational background to this particular arrest because I cannot, but obviously there are powers of redress and if a person thinks they were wrongfully arrested, they should absolutely use those. It will then be for the police to justify their reasonable suspicion and to prove that it was proportionate.

[Lord Robathan (Con)]

Will my noble friend the Minister pass on the congratulations of the majority of people in this House and the overwhelming majority of people in the country on a very well policed and very important occasion? I do not think anybody can doubt that it was well done. Can he also pass on the feeling that, while we all allow peaceful demonstrations, the idea that such an important occasion should have been disrupted by self-indulgent young people—or indeed middle-aged people—is outrageous? I think the majority of people in this country support that.

[Lord Sharpe of Epsom (Con)]

I agree with the thrust of my noble friend’s remarks, but of course it is important that people are aware of the powers the police have. I should have said yesterday, in answer to a question from the right reverend Prelate, that the College of Policing did issue guidance on the day of Royal Assent. The police chiefs’ lead on public safety also wrote to chief constables and the Police Powers Unit in the Met wrote to five particular organisations it felt might be affected by this. Also, as Sir Mark said, the police explained in advance that there would be low tolerance of disruption and zero tolerance of security and safety threats. No one can say they were not warned, but I agree with my noble friend that, overall, the whole event passed off magnificently.

[Lord German (LD)]

My Lords, my question does not detract from the superb job the police did in managing what they had to do to make the Coronation work as it did. However, from the figures that the Minister has just given us and information we have received from the Metropolitan Police, there were some six of those arrests for which an apology was given. That is an apology rate—or an error rate—of between 10% and 12%. Does the Minister accept that that is an issue he would be concerned about? Does he also agree with the chief constable of Manchester that the powers in general given to the police force need to be re-examined because they are too broad?

--- Later in debate ---

[Lord Sharpe of Epsom (Con)]

My Lords, I do not agree that an apology was given for these arrests. The Metropolitan Police expressed regret that six people who were arrested were unable to join the protest—not that they were arrested but that they were unable to join the protest. This is what I agree with: “Most people say police need powers to deal with Just Stop Oil and some of their tactics. They do need powers to deal with that. Legislation needs to bed down. We need to let it bed in. We need to look at how it operates in practice”. That quote was from Sir Kier Starmer.

[Baroness Boycott (CB)]

My Lords, I want to ask particularly about one arrest, because in the Public Order Act it was agreed that people covering protests—journalists, film-makers et cetera—were not going to be arrested. However, Rich Felgate, who was filming both the wonderful ceremony as well as the protest, was stopped by a policeman. He said:

“He stopped my filming, they handcuffed me behind my back”.


He started to say,

“‘the police are arresting a journalist’ and they proceeded to rip off my press pass lanyard, I presume because they didn’t want it to be visible that they were arresting a journalist”.

He was taken into police custody, held for 18 hours, interviewed and released under investigation. Could I have the Minister’s comment on this case and whether what was passed in the Public Order Act actually does stand?

[Lord Sharpe of Epsom (Con)]

I failed to answer the question from the noble Baroness, Lady Chakrabarti, on when this part of the Act will commence. I can give her a better answer today. It is on 2 July this year. However, I can also say that this gentleman was not arrested under the Public Order Act. He was arrested for conspiracy to cause a public nuisance. I cannot go further in commenting on the specifics of the case.

[Baroness Chakrabarti (Lab)]

My Lords, why did the Government not bring in the protection at the same time that they brought in the new powers?

[Lord Sharpe of Epsom (Con)]

I cannot answer that, I am afraid. I do not know.

[Lord Bellingham (Con)]

My Lords, obviously the ability to protest is one we take incredibly seriously in a constitutional democracy. Weighed against that are the rights of the hundreds of thousands of people who turned up, queued patiently and filed behind barriers. Many actually camped out. They have rights as well. Would the Minister reflect on this very simple point? Had there been a major incident of any kind during this remarkable day of the Coronation, the police would have attracted a huge amount of castigation from many people—the same people who are criticising them for what they did with the arrests.

[Lord Sharpe of Epsom (Con)]

I entirely agree with my noble friend.

[Lord Coaker (Lab)]

We all supported the actions of the police in enabling the Coronation to take place and praised them for it yesterday, but we also said that certain questions arose. I did not ask yesterday who decided that the Home Office was the appropriate authority to write letters to individual protesters warning them of the consequences of the Public Order Act and telling them what it was about. The Minister always makes a great play of the operational independence of the police, and that it is Parliament that makes the law. What happened with respect to the Home Office doing that? Who signed the letters to individual protesters? Is this a new tactic? Can we now expect the Home Office to write letters to protesters, rather than it being a matter for the police, which I thought it would have been?

[Lord Sharpe of Epsom (Con)]

As I understand it, an operation called the Police Powers Unit wrote to five protest groups to inform them of the changes to public order legislation. It is obviously right that people who may fall foul of changes in legislation should be warned. As to who signed it and where that unit sits, I am afraid I do not know but I will find out.

[Lord Hogan-Howe (CB)]

My Lords, in general, would the Minister agree—I think he has already said this—that the operation seemed to go really well? I think over 11,000 officers were deployed. Hundreds of thousands of members of the public were able to attend and people were able to protest. There was a collection of heads of Government from many countries across the world, including our own, which always invites security issues, as well as protest and all the other things that go with it. The fact that so few people were arrested is pretty remarkable. If individual cases need looking into, people should take the opportunity to make a complaint or take civil action. That should not detract from the overall operation, which seems to have gone so well, together with the great ceremony on the day.

[Lord Sharpe of Epsom (Con)]

Well, I absolutely could not agree with the noble Lord more.

[Lord Beith (LD)]

The success of the police’s actions over the Coronation as a whole surely does not prevent us from considering the long-term dangers, which we started to learn about during the Covid regulation period, of creating situations in which police officers are felt by citizens to be interfering with legitimate rights, whether it is protest or just the ability to walk in the countryside during the Covid regulation period, or to take home a tube of glue to repair some domestic damage. Surely we have to consider those long-term issues, while rejoicing in the fact that a good job was done by so many police officers.

[Lord Sharpe of Epsom (Con)]

I agree with the noble Lord: all of those matters should stay under active consideration, particularly as the nature of crime, disruption, protest and what have you evolves. But, overall, I also agree with the noble Lord that last weekend was a magnificent one in the life of the nation, and all of those involved should be applauded, including the people who went and those who protested peacefully.

Economic Crime and Corporate Transparency Bill

Lord Sharpe of Epsom Excerpts

Committee stage
Thursday 11th May 2023 Grand Committee

[The Parliamentary Under-Secretary of State for Migration and Borders (Lord Sharpe of Epsom) (Con)]

My Lords, I thank the noble Lord, Lord Coaker, for this amendment. Of course, the Government take the compensation of victims of economic crime very seriously, as it is crucial for limiting the harm of these ruthless crimes.

The noble Lord referred to the fraud strategy. I will come back to that in a second. Of course, the object of that exercise, as well as going after stolen money, is to prevent it happening in the first place. So this has to be considered in the round. These are obviously anti-crime measures, as well as enforcement and mitigation measures.

I completely agree with the noble Lord, Lord Fox: fraud is an attack on growth and we should bear in that in mind. Fraud and the reimbursement of fraud, as we know, costs the banks many billions a year already under the existing arrangements, which I will come back to. Clearly, somebody has to pay for that and it is not easy for society to bear, never mind the banks themselves.

Asset recovery powers under the Proceeds of Crime Act 2002 already provide the court with the ability to prioritise the payment of compensation orders to victims. We have had extensive conversations on all manner of asset seizures and reimbursements, including on the Ukraine question, to which the noble Lord, Lord Fox, just referred. I have absolutely no doubt that those conversations will continue. We are looking at the situation that he described, which developed, as I understand it, overnight. I do not know the details—we will find out.

The Government are legislating, through the Financial Service and Markets Bill, to remove any regulatory barriers to the Payment Systems Regulator making reimbursement mandatory for victims defrauded through the faster payments system. We are therefore already taking active steps to improve compensation routes and consider that there are already means of redress available.

Having said that, I also point to the fraud strategy, which the noble Lord, Lord Coaker, referred to. There is only one relatively small paragraph on this but if he goes to page 24, he will see that the City of London Police

“are also working with the private sector on a limited pilot to explore whether civil debt recovery and other powers can recover more of victims’ money. As this pilot develops, we will review whether there are further civil enforcement powers that could be applied to fraud”.

I will come back to that in more detail, obviously, but clearly it is very much at the pilot stage at the moment. That is explicit in the text. But the interests of victims are being actively considered via the fraud strategy. Again, there is more to be said on that, which I will do shortly.

As I have said before in Grand Committee, victims’ interests are at the heart of the new powers introduced by Part 4 of the Bill, which will allow applications for stolen crypto assets or funds in accounts to be released to victims at any stage of civil forfeiture proceedings. This will ameliorate the negative impacts of criminal conduct, including economic crime.

More widely, and I have referred to this from the Dispatch Box in the Chamber, victims need to have the confidence and trust to come forward to report fraud and to know that their case will be dealt with. That is why we are providing £30 million to the City of London Police to upgrade Action Fraud, which, as noble Lords will know, has not been widely applauded in this House. The new service will use the latest technology to drastically improve reporting and support for victims and provide far greater intelligence to policing, which will allow greater prevention and disruption at scale. The upgrade is already happening. It will be fully operational in 2024 and we are implementing consistent support for victims across England and Wales by expanding the National Economic Crime Victim Care Unit, to which I have also referred.

Where there are overseas victims in bribery, corruption and economic crime cases, the Serious Fraud Office, Crown Prosecution Service and National Crime Agency compensation principles have committed law enforcement bodies to ensuring that compensation is considered in every relevant case, and to using whatever available legal mechanisms to secure it where appropriate.

The Government are also fully committed to utilising suitable means to return the proceeds of corruption to their prior legitimate owner and/or to compensate victims, in line with international obligations under the UN Convention against Corruption. This is set out in detail in the Government’s Framework for Transparent and Accountable Asset Return.

Of course, the private sector also has responsibility for the protection of its customers, and we are increasing that further. Victims of unauthorised fraud, where payment has been taken without the victim’s permission, are already reimbursed by payment service providers. The contingent reimbursement model code has improved the reimbursement by payment service providers of victims of authorised fraud where a fraudster has manipulated the victim into approving the payment.

On the subject of PSPs, the right reverend Prelate made a good point about consumers becoming more savvy. I recently read in a briefing—I cannot remember whether it comes from the Fraud Strategy or some other current initiative—about the level of information sharing by PSPs, which will enable potential victims to identify the platforms that tend to be the most used. If they can be appropriately savvy when looking at those platforms and, perhaps, a little more suspicious and questioning, that will help enormously in stopping this happening in the first instance. I will come back with more detail on that, because I cannot quite remember under which regime that sits.

On the contingent reimbursement model, in 2021, £583 million was lost to APP scams. According to UK Finance data, the faster payment system was used in 97% of APP scams by volume in 2021. Under the contingent reimbursement model code, which is the voluntary scam reimbursement code signed by several major banks, the level of reimbursement is just over 50% of total APP scam losses for those signatory firms. Following PSR action, we expect that consumers will be reimbursed more consistently and comprehensively.

I realise that there is a lot more work to do on this. Clearly, the picture is fast evolving, as I am sure all noble Lords would acknowledge. There is clear intent on the part of the Government to make sure that victims are front and centre in the current regimes and all future planning. With that, I hope that the noble Lord, Lord Coaker, feels reassured and able to withdraw his amendment.

[Lord Coaker (Lab)]

I thank the Minister for that response. I am somewhat reassured, because I believe he has his own personal commitment to this. However, as with many amendments that we have discussed here, you get the feeling that it needs a bit of a boost a surge of urgency.

There is clearly a lot of good will and a lot of good government policy. There is nothing in particular wrong with the Fraud Strategy, which has some really good stuff in it, but the example that the Minister gave from page 24, which was perfectly reasonable, is a pilot. It does not say, “We will change the law”, but “we will review” what the pilot tells us, whereas, if you go back to the much stronger commitment at the beginning of the Fraud Strategy, it gives you some expectation that something will happen. It does not say, “We will review” but “We will ensure”—which is the sort of language that people want to hear—that

“victims of fraud are reimbursed and supported”.

It does not say, “We will review the law” but

“We will … Change the law so that more victims of fraud will get their money back”.


I get what the Minister said—that it is a pilot and a review, which is good—but a pilot and a review is not the same as what is promised in paragraph 7 on page 4 of the Fraud Strategy. We are talking about colossal sums of money and, as the right reverend Prelate the Bishop of St Albans pointed out to us, people are embarrassed; large numbers do not know what their rights are under the current law and cannot get their money back. That is the reality. The simple question for the Government, who I am sure want to improve it—there is no doubt about that—is: what five practical things will it mean? We cannot change the past, but we could do something about the future.

I also take the Minister’s point that this is about prevention, too. I absolutely accept that; we need double authentication and so on. I thank the right reverend Prelate the Bishop of St Albans for his support and helpful comments in this short but important debate. I also thank the noble Lord, Lord Fox, for reminding us that businesses and enterprises are also subject to fraudulent activity and that this is about them too. That was an important point to make.

To conclude, I thank the Minister for his response but ask him to speak to his department about how we get that surge of energy into the Bill and make what the Fraud Strategy says a reality so that we make a real difference. With that, I beg leave to withdraw my amendment.

--- Later in debate ---

[Lord Coaker (Lab)]

I was not going to say very much but I have been provoked by what the noble Baroness, Lady Bennett, and the noble Lord, Lord Agnew, have said.

I very much support the thrust of what the noble Baroness, Lady Kramer, said. One wonders why transparency is such a difficult notion for the Government. I suspect that the Minister will send up smoke by saying that we are all in favour of freeports, that they are a great way of generating employment, and so on. It is certainly what I would say if I were him—that freeports are a great thing for creating jobs and that we should not stand in the way of free enterprise, which is developing enterprise zones in some of the most difficult and challenging areas in the country. However, this is not about that—it is about transparency and knowing how this is funded—so I hope that the Minister does not send up smoke. The issue is transparency; the noble Baroness, Lady Kramer, was right to point that out.

I will not repeat the list from the noble Baroness, Lady Bennett, of concessions and allowances made to ensure that businesses can operate—perhaps in an area that they would not operate in—as that is something for the Minister to discuss.

On what the noble Lord, Lord Agnew, said, has the Minister had discussions with the noble Lord, Lord Johnson? Is it right that the Government are considering some concessions? Is that what the Minister is going to tell us—that he is going to go away and talk to the noble Lord, Lord Johnson, about what we have just been informed about? Is there hope for this amendment or will the Minister just reject it? Is it something that we will hear more about as we go to Report? Will we get a government amendment on transparency around this issue, if not from the Minister then from the noble Lord, Lord Johnson?

With those questions, I will listen to the Minister with care.

[Lord Sharpe of Epsom (Con)]

I thank the four noble Lords who have spoken in this debate. I also thank the noble Baroness, Lady Kramer, for her Amendments 106EC and 106ED. Amendment 106EC would require an overseas entity to apply for registration in the register of overseas entities if it is operating in a freeport. Amendment 106ED would require an overseas entity to apply for registration in the register of overseas entities if it is operating in an investment zone tax site. I thank the noble Lord, Lord Coaker, for his eloquent support for freeports.

[Lord Coaker (Lab)]

Can I clarify that I was saying what I thought the Minister would say, not what I think?

[Lord Sharpe of Epsom (Con)]

It was spot on so I suspect that the noble Lord has nobbled my notes at some point.

The economic merits of and progress in delivering freeports and investment zones remain at the heart of the Government’s levelling-up agenda, and good progress is being made. However, that is not quite within the scope of this Bill, so I will focus on the core points raised in relation to corporate transparency and illicit finance. I will endeavour to answer the questions asked of me while noting, as my noble friend Lord Agnew has, that this is not necessarily my specialist subject.

Turning first to Amendment 106EC, I am assured that, throughout the bidding prospectus and subsequent business case processes, freeports were required to set out how they will manage the risk of illicit activity. I will go into this in some detail because it is important and, as I am not a specialist in this subject, I asked for extra detail. These plans were approved by officials in the Border Force, HMRC, the NCA and other relevant crime prevention bodies, including the Home Office, the police, the Department for Transport and DLUHC.

At business case stages, freeports are required to commit to further requirements to mitigate risk. That includes commitments to the OECD’s code of conduct for clean free trade zones and they were required to establish robust local governance structures in place to monitor risk and ensure effective co-operation between relevant bodies with remits to prevent illicit activity. In most cases, that included most of the bodies I have already referenced—the police, NCA, and so on. Those plans were approved by officials who have responsibility for security and preventing illicit activity across government, and they are also required to carry out an annual audit of security each year to ensure that these structures remain effective and the risk mitigations remain robust and relevant. These audits will be reviewed by the Government annually.

Freeport status in no way undermines or weakens existing port security arrangements. Special customs status, which has been noted, builds on, rather than radically departs from, facilitations available elsewhere in the UK, and is available only on specific customs sites within the wider freeport footprint. These are secure sites administered by a specially authorised customs site operator—CSO. CSOs are required to obtain AEO or equivalent authorisation from HMRC, an international gold standard for safety and security, and remain subject to robust ongoing oversight from HMRC. Freeport customs sites therefore uphold the UK’s high standards on security and preventing illicit activity and should not be conflated with some entirely different international free trade zones.

I hope I have been clear that the Government require each freeport governance body to undertake reasonable efforts to verify the beneficial ownership of businesses operating within the freeport tax site. As I have said, freeports uphold the UK’s high standards on security, safety, workers’ rights, data protection, biosecurity, tax avoidance and evasion, and the environment. They are subject to the same legislation and regulation to protect them as the rest of the country. To impose additional requirements on businesses investing in freeport tax sites would directly undermine the objective of freeports: to facilitate investment and regenerate some of the most deprived areas of the UK. The Government therefore do not think it is proportionate to impose this additional cost and administrative burden on freeports compared to elsewhere in the UK, which would also risk acting as a disadvantage for bringing in investment.

I turn to investment zones. The Chancellor announced in the Autumn Statement that the investment zones programme was being refocused to catalyse the development of clusters in areas in need of levelling up in order to boost productivity, growth and jobs. At the Spring Budget, the Government announced eight areas in England that it had identified to co-develop an investment zone proposal with the Government, with a view to agreeing proposals by the end of the year, subject to requirements being met. The Government will work with these places to co-develop proposals, ensuring that the same high standards that are required for freeport tax sites are met for any investment zone tax sites designated.

Given the early stages of policy development on investment zones, it is too early to set out the governance arrangements in any detail. However, I am clear that businesses within investment zone tax sites will need to comply with the same laws and high standards regarding transparency as any other business investing in the UK. I am also afraid that both amendments would duplicate existing requirements on UK-registered businesses. If a business in either a freeport or an investment zone, once established, is a UK-registered company, it is already bound by the requirements to report its people with significant control to Companies House. This information is publicly available on the Companies House register.

It would also partially duplicate the requirements of the register of overseas entities. Any overseas entity owning, buying or leasing land or property in a freeport or an investment zone, once established, would be required to give information about their beneficial owners to Companies House. This information is also available to the public and would help law enforcement track down those abusing freeports for money laundering or other nefarious purposes. In both cases, all information held by Companies House is available to law enforcement, even information which is not publicly available; for example, the information about trusts.

I also draw noble Lords’ attention to the far-reaching impact of the amendments, which refer to “businesses operating” in free ports and zones. A “business” goes beyond companies and similar corporate entities and includes, for example, sole traders; “operating” is also an imprecise term. Let us imagine a truck of goods arriving at a freeport: the amendment would require the freeport governance board to determine the beneficial ownership of the haulage company owning the truck as well as the beneficial ownership of every business whose goods are being carried on that truck. One company may own the truck and another the trailer, both are caught. Under this scenario, even the delivery driver bringing sandwiches to the businesses located in the zone would be impacted by the amendment. I am sure that was not the noble Baroness’s intention and she will say that it could be improved at the drafting stage, but it is worth pointing that out.

--- Later in debate ---

Moved by

[Lord Sharpe of Epsom]

106F: Clause 189, page 173, line 21, after “Regulations” insert “made by the Secretary of State”
Member’s explanatory statement
This amendment is consequential on new clause (Fraud offences: supplementary) and ensures that the requirement that regulations under the Bill must be made by statutory instrument only applies to regulations made by the Secretary of State.

[Lord Sharpe of Epsom (Con)]

My Lords, these government amendments concern commencement and cut across several clauses. Amendments 106F, 106H and 107A are consequential on the regulation-making powers introduced by the new clause headed, “Fraud offences: supplementary”, which is one of the Government’s new clauses introducing a failure to prevent fraud offence. Amendments 106G and 107B, and the proposed new clauses to be inserted by Amendments 109 and 110, replace Clause 191 with a new commencement clause and a separate transitional provision clause. The clauses are being separated into two to make the commencement provisions easier to follow and avoid having one long and complex commencement provision.

They include a number of small, technical changes to ensure that the commencement provisions in the Bill work as effectively as possible and bring the devolution aspects of the commencement powers into line with previous similar legislation. They also bring into force, on Royal Assent, procedures in the Bill about the codes of practice which will govern the strengthened information order powers. This will ensure that those powers can quickly start to be used. Certain money laundering reporting measures are also being commenced on Royal Assent: the exemption for “exiting and paying away” and the new defence against failure to report, which we debated earlier in Committee. That will give certainty to businesses about their reporting duties as soon as the Bill is passed.

I hope noble Lords will support these amendments. I beg to move.

[Lord Fox (LD)]

My Lords, I will speak very briefly—I am sure the Minister will be glad to know that. I am intrigued by Amendment 109 because it complicates the process of bringing the Bill into being quite a lot. There are a lot of moving parts set out in Amendments 109 and 110 for the Bill to start to be effective. The simple question is: from start to finish—from Royal Assent to when everything is working and all parts are moving—what is the Government’s estimate as to long it will take to fulfil all the steps set out in these amendments?

[Baroness Blake of Leeds (Lab)]

I too will speak very briefly. I note the comments about consultation with devolved authorities. Given concerns about the extent of consultation in other areas, can the Minister reassure us that it is adequate, and deemed adequate by the devolved authorities? That is a clear theme running through some of the legislation.

We have discussed—we will revisit it, I am sure—the issue of failure to prevent and the specific mention of large organisations. We understand that keeping it to large organisations will not capture a broad enough spectrum of the businesses that we are covering. Having said that, I recognise that this is a tidying-up exercise. With further amendments we might revisit some of the issues at a future stage, but I would be grateful if the Minister could respond to those comments.

[Lord Sharpe of Epsom (Con)]

I thank noble Lords for their brief comments. In answer to the noble Lord, Lord Fox, about when the powers in the Bill will be brought into force, obviously I speak with authority only for the Home Office measures in the Bill. Certain measures in the Bill that are necessary to issue codes of practice will come into force on the day of Royal Assent, as will some of the money laundering reporting measures that we discussed previously in Committee. It is our intention for some of the remaining measures to be brought into force in autumn. This is subject to obtaining Royal Assent before summer.

The operalisation of these powers is a priority for the Government and our law enforcement partners. That is why we have taken steps to provide pre-commencement consultation for a number of measures in the Bill, to facilitate it coming into force as early as practically possible.

Some of the Companies House reforms will require consequential changes, including secondary legislation and guidance. Certain reforms, such as identity verification, will also require system development following Royal Assent. Some changes will be implemented almost immediately but others will take longer. We cannot commit to precise dates at present but work on implementing the measures is already under way at Companies House. Companies House is an executive agency of the Department for Business and Trade and there are various governance mechanisms to hold the agency to account on those reforms.

As I mentioned previously, these amendments are technical. They are designed to ensure that the Bill is effective and to make changes following amendments debated previously in Committee.

Before I wind up, I thank all noble Lords for their participation in the Committee, in particular the Front Benches. It has been a lively, extremely interesting and well-informed Committee. It will certainly improve the Bill over the course of its passage through Parliament. I thank my officials for the constructive spirit in which they have engaged with all interested Peers. From a personal point of view, I also thank them for guiding me through some fairly tricky questions. I hope that noble Lords are satisfied with the amendments.

[Baroness Blake of Leeds (Lab)]

My Lords, I asked—

[Lord Sharpe of Epsom (Con)]

My profuse apologies to the noble Baroness, Lady Blake. I am assured that all discussions have taken place with the devolved Administrations and that they are all content with it.

Amendment 106F agreed.

--- Later in debate ---

Moved by

[Lord Sharpe of Epsom]

106G: Clause 189, page 173, line 21, at end insert—
“(2A) For regulations made under this Act by the Scottish Ministers, see section 27 of the Interpretation and Legislative Reform (Scotland) Act 2010 (asp 10) (Scottish statutory instruments).(2B) Any power of the Department of Justice in Northern Ireland to make regulations under this Act is exercisable by statutory rule for the purposes of the Statutory Rules (Northern Ireland) Order 1979 (S.I. 1979/1573 (N.I. 12)).”Member’s explanatory statement
This amendment is about the classification of certain instruments made by the Scottish Ministers or the Department of Justice in Northern Ireland.

--- Later in debate ---

Moved by

[Lord Sharpe of Epsom]

109: Clause 191, leave out Clause 191 and insert the following new Clause—
“Commencement
(1) Except as provided by subsections (2) to (5), this Act comes into force on such day as the Secretary of State may by regulations made by statutory instrument appoint.(2) The following come into force on the day on which this Act is passed—(a) this Part;(b) any provision of, or amendment made by, Parts 1 to 5 so far as it confers a power to make regulations or relates to the exercise of the power;(c) paragraph 1 of Schedule 7 so far as it inserts section 303Z25 into the Proceeds of Crime Act 2002;(d) paragraph 16 of Schedule 7 so far as it relates to that section;(e) section 168 so far as it relates to the provisions mentioned in paragraphs (c) and (d);(f) section 170;(g) section (Money laundering: offences of failing to disclose);(h) section 172(12) and (13);(i) section 173(13) and (14).(3) Section 187 comes into force at the end of the period of 2 months beginning with the day on which this Act is passed.(4) The following come into force (so far as not brought into force by subsection (2)(b)) on such day as the Scottish Ministers may by regulations appoint after consulting the Secretary of State—(a) Part 2 of Schedule 6, and(b) section 167 so far as it relates to that Part.(5) The following come into force (so far as not brought into force by subsection (2)(b)) on such day as the Department of Justice in Northern Ireland may by order appoint after consulting the Secretary of State—(a) Part 3 of Schedule 6, and(b) section 167 so far as it relates to that Part.(6) No regulations may be made under subsection (1) bringing into force any of the following provisions, so far as they extend to Scotland, unless the Secretary of State has consulted the Scottish Ministers—(a) Schedule 7, and(b) section 168 so far as it relates to that Schedule.(7) No regulations may be made under subsection (1) bringing into force any of the following provisions, so far as they extend to Northern Ireland, unless the Secretary of State has consulted the Department of Justice in Northern Ireland—(a) Schedule 7, other than paragraphs 6(7), 10 and 11, and(b) section 168 so far as it relates to that Schedule, other than paragraphs 6(7), 10 and 11.(8) No regulations may be made under subsection (1) bringing into force section (Failure to prevent fraud) unless the Secretary of State has published guidance under section (Guidance about preventing fraud offences)(3).(9) Regulations under subsection (1) or (4), and orders subsection (5), may appoint different days for—(a) different purposes, and (b) where regulations under subsection (1) appoint a day for the coming into force of any provision of Schedule 7 or 8, different areas.(10) A power of the Department of Justice in Northern Ireland to make an order under subsection (5) is exercisable by statutory rule for the purposes of the Statutory Rules (Northern Ireland) Order 1979 (S.I. 1979/1573 (N.I. 12)).”Member’s explanatory statement
This amendment leaves out Clause 191 and inserts a replacement commencement Clause that provides for additional provisions to come into force at Royal Assent and for consultation requirements to apply in relation to certain cryptoasset provisions. See also the new transitional provision Clause to be inserted after Clause 191.

--- Later in debate ---

Moved by

[Lord Sharpe of Epsom]

110: After Clause 191, insert the following new Clause—
“Transitional provision
(1) The Secretary of State may by regulations made by statutory instrument make transitional or saving provision in connection with the coming into force of any provision of this Act, other than a provision mentioned in section (Commencement) (4) or (5).(2) The Scottish Ministers may by regulations make transitional or saving provision in connection with the coming into force of a provision mentioned in section (Commencement) (4). (3) The Department of Justice in Northern Ireland may by order make transitional or saving provision in connection with the coming into force of a provision mentioned in section (Commencement) (5).(4) The power to make regulations under subsection (1) or (2), and the power to make orders under subsection (3), includes power to make different provision for—(a) different purposes, and(b) where regulations under subsection (1) make provision in connection with the coming into force of any provision of Schedule 7 or 8, different areas.(5) Transitional provision and savings made under subsections (1) to (3) are additional, and without prejudice, to those made by or under any other provision of this Act.(6) A power of the Department of Justice in Northern Ireland to make an order under subsection (3) is exercisable by statutory rule for the purposes of the Statutory Rules (Northern Ireland) Order 1979 (S.I. 1979/1573 (N.I. 12)).”Member’s explanatory statement
This new Clause contains the powers to make transitional provision that were previously in Clause 191. It also includes additional powers for the Scottish Ministers and the Department of Justice in Northern Ireland to make transitional provision and savings in connection with the coming into force of certain cryptoasset provisions.

Economic Crime and Corporate Transparency Bill

Lord Sharpe of Epsom Excerpts

Committee stage
Tuesday 9th May 2023 Grand Committee

Moved by

[Lord Goldsmith of Richmond Park]

91A: After Clause 187, insert the following new Clause—
“Sanctions enforcement: monetary penalties
(1) In section 143 of the Policing and Crime Act 2017 (interpretation), in subsection (4) (meaning of “financial sanctions legislation”), in paragraph (f)—(a) the words from “contains” to the end become sub-paragraph (i);(b) at the end of that sub-paragraph insert—“;(ii) makes supplemental provision (within the meaning of section 1(6) of that Act) in connection with any prohibition or requirement mentioned in sub-paragraph (i).”(2) The Sanctions and Anti-Money Laundering Act 2018 is amended as follows.(3) In section 17 (enforcement), in subsection (9), in paragraph (a), after “(2)” insert “or makes supplemental provision in connection with any such prohibition or requirement”.(4) After section 17 insert—“17A Enforcement: monetary penalties(1) The provision that may be made by virtue of section 17(2) (enforcement of prohibitions or requirements) includes provision authorising a prescribed person to impose a monetary penalty on another person if satisfied, to the prescribed standard of proof, that the other person has breached a prohibition, or failed to comply with a requirement, that is imposed by or under regulations.(2) Regulations authorising the Treasury to impose a monetary penalty in respect of a breach or failure for which the Treasury could impose a monetary penalty under Part 8 of the Policing and Crime Act 2017 may not be made unless the regulations also make provision of the kind mentioned in section 17(9) to disapply Part 8 of that Act in respect of that breach or failure.(3) Regulations authorising the imposition of a monetary penalty may make provision that, in determining for the purposes of the regulations whether a person has breached a prohibition, or failed to comply with a requirement, any requirement relating to the person’s knowledge or intention is to be ignored. (4) Regulations authorising the imposition of a monetary penalty must provide that—(a) a person is not liable to such a penalty in respect of conduct amounting to an offence if—(i) proceedings have been brought against the person for that offence in respect of that conduct and the proceedings are ongoing, or(ii) the person has been convicted of that offence in respect of that conduct, and(b) no proceedings may be brought against a person in respect of conduct amounting to an offence if the person has been given such a penalty under the regulations in respect of that conduct.(5) Where regulations authorising the imposition of a monetary penalty authorise a prescribed person to determine the amount of the penalty, the regulations must provide for a maximum penalty.(6) The maximum penalty may be a prescribed sum of any amount or may be calculated in accordance with the regulations.(7) In this section—“conduct” means an act or omission;“regulations” mean regulations under section 1.””Member’s explanatory statement
This clause makes it clear that Treasury can impose monetary penalties under the Policing and Crime Act 2017 for breaches of provisions that are supplemental to financial sanctions and that regulations made under section 1 of SAMLA 2018 can include provision conferring power to impose monetary penalties.

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[Lord Leigh of Hurley (Con)]

My Lords, I am prompted to rise by the words of the noble Lord, Lord Trevethin and Oaksey. I think he was referring to Amendment 106C, which we will come on to later this afternoon and which would extend the costs cap beyond UWOs. In the certainty that my noble friend the Minister will seek to ensure that Amendment 106C is agreed to, let me simply say that the amendment we are debating now, in the names of the noble Lord, Lord Faulks, and my noble and learned friend Lord Garnier, would be complementary and extremely helpful to Amendment 106C.

[The Parliamentary Under-Secretary of State, Home Office (Lord Sharpe of Epsom) (Con)]

My Lords, I thank noble Lords for proposing their amendments. I thank the noble Lord, Lord Coaker, for moving Amendment 93 on behalf of the noble Lord, Lord Hunt of Kings Heath. I also thank the noble Lord, Lord Faulks, for Amendment 95, which was spoken to by my noble friend Lord Young. Both amendments relate to reports connected with unexplained wealth orders, henceforth known as UWOs.

I turn first to Amendment 93, which would require the Government to lay annual reports on UWOs where the property has been obtained through economic crime and taken from vulnerable adults. Economic crimes not only result in financial gain for criminals but leave a trail of suffering. They inflict financial and personal loss, including on the most vulnerable members of our society, which this amendment importantly recognises.

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[Lord Fox (LD)]

The Minister set out some interesting statistics. It is clear that UWOs have been accountable for a very small proportion of the total amount of money recovered. The Minister referred to them as a powerful tool. Is he satisfied that UWOs are reaching their potential, in which case we would conclude that they are relatively insignificant compared to the other tools in the hands of enforcement, or are UWOs failing to meet their potential and not as powerful as they could be? Clearly, they are not generating very much money compared to all the other tools available to the enforcement agencies.

[Lord Sharpe of Epsom (Con)]

I am not sure that the question is entirely valid with regard to generating money. The fact is that, since their introduction in 2017, four of these have been issued in relation to assets with a combined value of £143 million. In October 2020, property worth an estimated £10 million was recovered, following the use of a UWO, as I have already said. As for whether the scheme is succeeding or failing, it is not for me to say. I am unable to do so, because I do not have access to the operational decision-making that goes into issuing them, and so on. These are operational matters.

[Lord Fox (LD)]

I accept that it is not for the Minister to say; who does say whether they are succeeding or failing?

[Lord Sharpe of Epsom (Con)]

I have already said that we will publish a number of reports on this on 1 September, so I would hope for some more clarity then, but I shall endeavour to find out more information and report back to the noble Lord.

[Lord Leigh of Hurley (Con)]

I share the disappointment expressed by other noble Lords. When UWOs first came out, I was very pleased to see them. They are a classic accountancy tool to establish what is going on in respect of an individual who may have accumulated wealth in an unexplained way. It is incredibly disappointing to learn that so few have been issued with, frankly, teeny sums of money, given the nature of the world that we are discussing. Can my noble friend take back our concerns to his colleagues and, in particular, ask whether targets could be set for the coming year on the number of UWOs that might be issued and the amount of funds that they might realise?

[Lord Sharpe of Epsom (Con)]

I am certainly happy to take my noble friend’s concerns back but, as regards targets, that would invite me to stray into operational matters, which I will not do.

[Lord Coaker (Lab)]

I thank the Minister for his reply, although I also share that disappointment. I should have thought that the focus of the noble Lord, Lord Young, speaking on behalf of the noble Lord, Lord Faulks, and the noble and learned Lord, Lord Garnier—as I am speaking on behalf of my noble friend Lord Hunt—was to ask the Government to bring a report, even if that is not the appropriate way of doing it, and say to them that the operation of UWOs is simply not working as they expected. It is perfectly reasonable for a Minister of the Crown, while of course not interfering with the operational independence of the police or any other law enforcement agency, to look at the legislation and see whether it is working as the Government expected. Clearly, it is not, so it would be a perfectly reasonable response to say that nine applications, four cases and the odd bit since is simply not what anybody would have thought acceptable or thought would happen.

This happens with legislation; even if we had the Government of our dreams, laws would be passed that did not function or operate in the way we would want—but that is the purpose of Committees such as this. This is where, to be frank, Ministers listen to what is said and respond that they will take the matter back and that it is unacceptable, rather than come off saying that it is one tool in the box of government in dealing with the issue.

The Minister had a pop at me. I was only using the facts that are available in a government document called Fact Sheet: Unexplained Wealth Order Reforms. If the facts I am giving the Minister are wrong then, frankly, the Government should have updated the facts, because this is what all of us use in these debates. I have not made it up—I have read the Government’s material. The Minister then turns around and says that the noble Lord, Lord Coaker, has not got it right, because the up-to-date figures are X, Y and Z against POCA. It might have been helpful to have the key facts.

Again, I read out,

“the Proceeds of Crime Act 2002 is a complex and technical Act and reform requires careful consideration and consultation”.

Then the Minister had a go at me and laid out four Acts of Parliament that have been done since. Why were they not included in the key facts? It would have been helpful to everyone to understand the way in which it had been reformed to see whether it is now working and functioning as the Government want it to. I do not have five floors of civil servants providing me with a brief that says there are four pieces of legislation which have updated and improved it. The serious point is that, when I and other members of the Committee depend on the government document setting out the key facts in relation to what we are discussing, it should be up to date. That is the only point I want to make.

I do not know whether the figure that I was going to use is out of date. A number of members of the Committee made the point to the Minister that, if it is hundreds of millions that have been recovered over a number of year, that is peanuts. The reason I say it is peanuts—the Minister will correct me if I have got this wrong—is that Fact Sheet: Unexplained Wealth Order Reforms says under the heading “Key Facts”

“Serious and organised crimes … for example”—


and lays out various things—

“are estimated to cost the UK economy £37 billion per year”.

That is not my figure. The key facts document published by His Majesty’s Government says it is £37 billion a year. I should have thought that the response to what are clearly probing amendments about reports would be, “It is £37 billion a year, we are getting a few hundred million there, we are getting £100 million there, £50 million there”. Why are we not making more of a dent into what we all, including the Minister, regard as simply and utterly unacceptable? The Minister will think it is unacceptable that we have that.

Of course, I shall not move the amendments, but I hope the Minister will take back the bureaucratic point about ensuring that the key facts documents that we use in our deliberations are updated. I hope that he will also talk about the point that unexplained wealth orders were brought in as a way for the Government to address the problem, which the noble Lord, Lord Young, and others mentioned, that huge sums of money surround individuals who have no legal way of explaining how on earth they got them.

I shall raise one other point, because it drove me mad when I was a Member of Parliament and before that a local councillor. On estate after estate, on housing area after housing area, it drove people who went to work mad to look down the road and see somebody who did not go to work driving a Ferrari, or something like that. At an individual level, that is exactly what all of us feel more generally about what is happening nationally and internationally, where people are playing the system. The vast majority of law-abiding business men and women and businesses conform to the law, pay their taxes and do their best—but £37 billion a year is lost to fraud. In answer to the noble Lords, Lord Fox and Lord Young, and me, the Minister talked about getting £10 million here and £100 million there. I am pleased that we got that, but it is peanuts compared to the amount of money that we are talking about. I hope the Minister can take that back—

[Lord Sharpe of Epsom (Con)]

As the noble Lord has drawn on the key facts document, it is important for me to provide a bit of clarification. It was published on 4 March 2022 for the previous Bill, not this Bill. Those numbers were correct at the time of publication. On UWOs, they have been applied for—I have said how many times—and two of the applications have been made since the Government reformed the UWO regime last week, which I should have said while I was answering noble Lords. Perhaps that provides a bit more clarity. On the key facts, the three floors of civil servants are in the clear.

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[Lord Leigh of Hurley (Con)]

My Lords, I rise briefly to urge the Minister to not allow the concept of a tier 1 investor visa scheme to be rubbished. This country has benefited enormously from foreign direct investment. I have seen a large number of UK small and medium-sized businesses benefiting from individuals coming to and living in the UK and putting money into and running the businesses, and those businesses flourishing thereafter. It is an important part of what we offer overseas investors, if done correctly.

I am a little disappointed that the noble Lord, Lord Fox, seemed to imply—and probably stated it; I may have missed it—that the reason that this information has not been published is that the Home Secretary is worried about disclosure of people who may have made donations to the Conservative Party. I do not think that is in the spirit of the debate; I do not think it is correct. The noble Lord laughs, but it is particularly surprising from the Lib Dems, which took money from Michael Brown, to make allegations like that, and it is a shame because I think there is great consensus in the Committee about the purpose and merits of the Bill.

[Lord Sharpe of Epsom (Con)]

My Lords, I thank all noble Lords, who have made some extremely thought-provoking points in this debate. I will do my best to address them all.

Scrutinising the activity of government is obviously a key function of Parliament, and of course the Government are entirely supportive of it. I reassure the noble Lord, Lord Browne, that this particular part of the government machinery is always grateful for any help that is offered and will receive it in that spirit. However, the amendments in this group are unnecessary, as they are duplicative of existing reporting arrangements and scrutiny structures.

On investor visas, I take my noble friend Lord Leigh’s points. If done in the right way, they are potentially an important engine of economic growth—that should be acknowledged. Of course, we should not forget that they were introduced by a Labour Government and maintained during the coalition years. However, on Amendment 102, tabled by the noble Lord, Lord Wallace of Saltaire, and moved by the noble Lord, Lord Fox, I am aware that there are concerns about how the now-closed tier 1 investor route operated—in particular, that it was used by those relying on funds that had been illegitimately acquired and those who may have posed a wider risk to the UK’s national security.

It was because of those concerns that the Government committed in the first place to the review of the visas issued under the route between 2008 and 2015. As has been acknowledged, the Home Secretary made a Written Ministerial Statement on 12 January setting out the findings of that review. This included that the review had identified a minority of individuals connected to the tier 1 investor visa route who were potentially at high risk of having obtained wealth through corruption or other illicit financial activity or being engaged in serious and organised crime. The Statement of 12 January represents the Government’s substantive response to the commitment to undertake a review and publish its findings, including its findings in respect of economic crime.

Obviously, there was a delay; we are aware that considerable time elapsed between the commissioning of the review and the setting out of those findings. However, delay is regrettable but not unreasonable when issues of national security are at stake. Let me expand on that a little, if I may. It would have been preferable had the review been able to include more information about specific individuals but we have had to act sensibly and responsibly with regard to the UK’s national security; this includes striking the right balance between setting out the review’s broad findings and observing the constraints on disclosing sensitive details, which must be withheld, at the request of our operational partners, to protect our border and the vital work of our law enforcement agencies.

The noble Lord, Lord Fox, raised the subject of party-political donations. Without getting into a slanging match on this subject, I think it is worth restating that UK electoral law already sets out a stringent regime of spending and donation controls that prioritise transparency and safeguard the integrity of our elections. All political parties recognise that third-party campaigners and candidates must record their election spending and report it to either the Electoral Commission or their local returning officer. This information is all publicly available. The measures in the Elections Act 2022 also updated the political finance regulatory framework by increasing transparency and fairness and strengthening the controls against ineligible foreign spending on electoral campaigning. That is a fairly comprehensive transparency regime concerning the funding of political parties.

The House has considered similar amendments to other legislation, most recently during the passage of the National Security Bill. As before, the Government’s view is that this amendment is not necessary. The Government have set out the key findings of the review of the operation of this route and have acted to close it. I therefore ask the noble Lord, Lord Fox, to withdraw the amendment.

[Baroness Bennett of Manor Castle (GP)]

My Lords, the Minister suggested that it was the inability to identify individuals that meant that some aspects of the report could not be released. I think that everyone understands the retraction of names where necessary, but surely that would not prevent the release of absolute figures rather than a summary of the figures.

[Lord Sharpe of Epsom (Con)]

As I said, it was also to do with the disclosure of sensitive details related to operational partners—the sorts of things that protect our border and the work of law enforcement agencies.

I thank the noble Lord, Lord Fox, for tabling Amendment 104, to which I will now speak. The impact of fraud and economic crime affects the whole of our society. The cost of fraud to the UK runs into the billions and is assessed by the National Crime Agency to be the most common crime type in England and Wales. We take this threat type seriously and have delivered a strengthened approach to reduce its impact. Obviously, as I referenced, the fraud strategy is one part of that; I will come back to it in a moment. The NCA currently leads the national response to serious and organised crime, including economic crime. As predicted, the NCA’s director-general is accountable to the Home Secretary and, through the Home Secretary, to Parliament.

The agency already publishes an annual plan and an annual report. The annual plan sets out how it intends to exercise its functions in co-ordinating the operational response to serious and organised crime, having regard to the Home Secretary’s strategic priorities and the director-general’s operational priorities. The annual report details its performance over the previous financial year, including efforts to tackle economic crime. The NCA also reports annually on the impact of suspicious activity reports in tackling economic crime and, as I set out earlier in response to Amendments 93 and 95 in the previous group, in respect of UWOs. Given this current reporting and the potential for duplication, the Government do not believe that this amendment is required at this time, so I ask the noble Lord, Lord Fox, not to press it.

I thank the noble Lord, Lord Coaker, for his Amendment 106B. Before I get into the amendment itself, let me say that I take the noble Lord’s points about the diversity of response to the sorts of crime that are being discussed. Of course, that partly reflects the diversity of the crimes being investigated, as he will be aware. The fact is that this is a fast-moving, rapidly evolving space; there is no doubt that the operational response to it reflects that particular set of circumstances.

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[Lord Coaker (Lab)]

Does that committee do an annual report? How often does it meet?

[Lord Sharpe of Epsom (Con)]

I do not know. I will find out and write to the noble Lord. For now, I hope he will accept that it is not the role of the Government to set up parliamentary committees and so will not seek to press his amendment.

I turn now to Amendment 106EB concerning the Serious Fraud Office. Once again, I thank the noble Lord, Lord Coaker, for tabling this amendment, which would require the Government to lay in Parliament an annual report on the Serious Fraud Office. The effectiveness of the agencies tasked with fighting economic crime, including the SFO, is of critical importance and of interest to both Houses. That is why the SFO annual report and accounts—these set out much of the information in which the noble Lord is interested—are routinely laid in Parliament.

The law officers of England and Wales superintend the SFO. They oversee the performance of the SFO, including steps that they can take to improve that performance. Through the superintendence process, the law officers identified the need to expand the SFO’s pre-investigation powers, a change that appears in Clause 185 of this Bill. The law officers take steps to ensure transparency, including participating in Attorney-General’s Questions in the other place; publishing summaries of minutes from SFO ministerial strategic boards online; and addressing issues promptly through Written Ministerial Statements.

This is complemented by the work of HM Crown Prosecution Service Inspectorate, which inspects the SFO and publishes its findings alongside a set of recommendations. HMCPSI recently published an inspection of the SFO’s case progression—that is, the organisation’s ability to deliver its cases efficiently and effectively. Given our previous discussions, the tone of the debate and the views expressed, I understand that the intention of this amendment is to probe the Government on the resourcing of the SFO.

The noble Lord, Lord Faulks, made a very interesting point; he may have noticed that I wrote my note on the wrong page when I referred to it earlier. I am coming back to it now; it is an interesting idea and I will definitely take it back. There is a process in place to recruit a new director-general of the SFO. I would imagine that acute matters, human resources and future resources are a part of the remit for that person but the noble Lord certainly makes an interesting point. To go back to a conversation during a debate that the Lord, Lord Browne, and I had last week, my personal point of view is that it is about time we all sat down and started to think about recruitment in law enforcement more generally.

[Lord Agnew of Oulton (Con)]

Given that my noble friend the Minister is going to take the comments made by the noble Lord, Lord Faulks, on recruitment back, I encourage him to look at the report by Andrew Cayley KC, Chief Inspector of the Crown Prosecution Service, who has also done a report recently. Some of the problems in the SFO are case workers not being paid enough, churn and so on, which led to the collapse of the case against G4S. There is big piece of work there that we could be doing stuff with.

[Lord Coaker (Lab)]

What is the Government’s view on whether the SFO is working?

[Lord Sharpe of Epsom (Con)]

Those are good questions; I will come on to them.

Funding and resourcing is a subject that is covered in the fraud strategy. I will not go over the details. At the most recent spending review, the SFO received an uplift to its core budget that is supporting its operations. In addition, the SFO continues to have access to reserve funding to fund specific high-cost cases if needed. This enables the SFO to obtain additional funding for any case that exceeds 4% of the core vote funding for the year.

My noble friend Lord Agnew and the noble Lord, Lord Coaker, referred to the G4S case. Obviously, it is always disappointing when a case has to be brought to an end before it is concluded but, like other agencies, the SFO is right to end an investigation or prosecution when it is no longer in the public interest. The SFO has acknowledged that there were disclosure challenges in the case that was closed earlier this year, R v Morris, Preston and Jardine. The SFO has made good progress on implementing the disclosure changes recommended by Sir David Calvert-Smith and Brian Altman KC in their independent reviews, published last year. The Crown Prosecution Service Inspectorate, the agency that inspects the SFO, has been asked to expedite a planned review of SFO disclosure, which will provide further independent assurance of the SFO’s processes.

Further to that, in Economic Crime Plan 2, which was published on 30 March, the Government set out their intention to explore reforms to the disclosure system to ensure that it supports a fair criminal justice system because cases that are lost on procedural grounds are, as noble Lords have noted, a loss to victims, taxpayers and, of course, society.

The noble Lord, Lord Coaker, just asked me whether the Government have faith in the Serious Fraud Office. The answer is yes.

[Lord Coaker (Lab)]

Is it working?

[Lord Sharpe of Epsom (Con)]

I would say that it is the same thing; perhaps we can debate that as well.

The Serious Fraud Office investigates and prosecutes the most complex cases of fraud, bribery and corruption. That is a very challenging remit. It has delivered some outstanding outcomes. For example, last year, it secured the conviction of Glencore for bribery and corruption in five countries, with the company ordered to pay £280 million—the highest ever ordered in a corporate criminal conviction in the UK—as well as eight convictions for five cases of fraud and bribery worth more than £500 million. It consistently recovers some of the largest amounts of proceeds of crime, despite being a fraction of the size of many other national agencies.

It is also important to note the SFO’s role in fighting economic crime globally. In the last financial year, the SFO took steps to assist overseas jurisdictions in their investigations by working on more than 60 incoming money-laundering requests. I think that the statistics answer the question—yes, we have faith, and yes, it is working. I hope that my explanations have provided some reassurance. I therefore ask the noble Lord not to press his amendment.

I turn to the final amendment in this group, Amendment 106EA, again tabled by the noble Lord, Lord Coaker. I come to this amendment last as it seeks to bring into one amendment much of what the other amendments in this group also attempt. I will not repeat myself too much here, especially considering how long I have gone on so far. The amendment would require the Government to issue a report on the performance of agencies and departments in tackling economic crime. However, I can assure noble Lords that this is already being done. As I have mentioned, the Government, regulators and law enforcement already regularly give evidence to parliamentary committees. The National Crime Agency is required under the Crime and Courts Act to publish an annual report and lay it before Parliament, further adding to the available scrutiny of operational bodies. The Government already conduct a range of threat and risk assessments to develop our understanding of economic crime. The NCA’s national strategic assessment assesses the economic crime threats facing the UK on an annual basis. As required under the money-laundering regulations, the UK also conducts periodic national risk assessments of money laundering and terrorist financing, which provide an overview of the risks and likelihood of an activity occurring. We have already discussed in detail the establishment of a fund to tackle economic crime so I will not repeat that debate again.

Regarding the amendment’s calls for a strategy on tackling economic crime, this March, the Government published Economic Crime Plan 2. Through 43 actions, it sets out how the public and private sectors will work together to transform the UK’s response to economic crime. Obviously, the fraud strategy is a part of that overarching economic crime strategy.

As regards the quality of the data in the fraud strategy, which was referenced by the noble Lord, Lord Browne, I have just had a quick flick through and it is more recent than six years. I should also reassure the noble Lord that one of the commitments in the fraud strategy is to improve the quality and collection of data, so this can be regarded as a baseline.

There are numerous ways in which the Government report on their performance with regard to tackling economic crime. This amendment is duplicative of them and therefore unnecessary. I ask the noble Lord to withdraw his amendment.

[Lord Fox (LD)]

My Lords, we are indebted to the noble Lord, Lord Coaker, for his amendments because they have inspired an interesting debate. The Minister has made a spirited defence of the Government’s position on this issue, but the very fact that these questions are being asked—and by a lot of people, not just the people in this Room—indicates that there is a lot of work for the Government to do in order to placate, explain or perhaps improve what is going on out there. The key element, which was highlighted earlier, is the alphabet soup of different agencies all interlinking in what is going on. The Minister has made a big effort in trying to calm nerves but I do not think that those nerves are calmed. Although the amendments will undoubtedly be not be moved, there is work to do; hopefully, the Minister has got that message from the nature of this debate.

I refer back to Amendment 102. Clearly, it ruffled some feathers. I note that in 2022 it was the Conservative Government who saw fit to withdraw this scheme because they felt that there were serious issues. We know that of the 6,000 such issues, a minority were problematic, but we still do not know exactly how many. I want to address the point made by the noble Lord, Lord Leigh that there is some use to encourage inward investment. This scheme clearly went off the rails, but by publishing the report properly, we would know how to encourage it without causing the issues that the Government clearly felt were sufficient to close the scheme. I am comfortable that I was not overstating the problem. The problem was there and the Government identified it, but now we have an issue in that we do not know the full scope of the problem.

In his response on party finance, the Minister referred to national security. The fact that there are issues is well covered. The Minister should know—I am sure that he does—that amendments to the National Security Bill that sought to enhance the scrutiny of the source of political donations have been thrown out by the Commons, so some of the things that the Minister said are not strictly there. There is still an issue between this House and the Commons when it comes to the National Security Bill and party funding, and it remains ongoing. I think that was the issue that my noble friend was anxious to state.

On the subject of the report and the reference to party funding, I remind noble Lords that I said that it makes it difficult not to conclude that there are embarrassing issues to hide because the report was not published. If there is no problem, as I am sure noble Lords believe, there is no reason not to publish the report. It is the non-publishing of the report that causes suspicion. That is the point that I was trying to make.

With that, I beg leave to withdraw Amendment 102.

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[Lord Ponsonby of Shulbrede (Lab)]

My Lords, this has been a very interesting debate; it is the first debate in which we have spoken on a more international level. As we heard in our earlier debates, a large proportion of the quantity of money involved in fraud—well over 90%; probably 99%—has an international element; that is at the core of so much of the fraud with which we are dealing.

I congratulate the noble Lord, Lord Oates, on the way in which he introduced this group. I found his introduction rich and compelling. He set out things very fully. The other noble Lords who have spoken have talked about the aspirational nature of this amendment. I do not think that that is a criticism. It is good to hear about the other countries that are already taking a lead in trying to get the IACC set up.

From the Labour Party’s point of view, I have looked at what David Lammy has said on this matter. He has spoken about working internationally—I know that my noble friend Lord Hain led the work on that when he was a Foreign Office Minister—and promised that an incoming Labour Government would fight against dirty money in the UK by creating a transatlantic anti-corruption council alongside the US, EU and other allies. That is a different model from the one proposed in these amendments.

I do not want to stand here as an opposition spokesman saying that we are against what the noble Lord, Lord Oates, and the noble Baroness, Lady Bennett, are proposing but there are other potential models for bearing down on corruption. I listened with some interest to what the noble Lord, Lord Faulks, said about the practicalities of doing this and using legislation such as this to do everything we can on a domestic level, and internationally where we already have direct interest, to bear down on this huge level of corruption. Nevertheless, I thank the noble Lord for introducing this amendment.

[Lord Sharpe of Epsom (Con)]

My Lords, I thank the noble Lord, Lord Hain, and the noble Baroness, Lady Bennett, for their amendments in this group. I also thank all noble Lords for speaking in this debate.

I turn first to Amendment 103, which was tabled by the noble Lord, Lord Hain, but spoken to by the noble Lord, Lord Oates. If I may, I associate myself with the remarks of the noble Lord, Lord Ponsonby: the noble Lord, Lord Oates, made an incredibly powerful and eloquent case in moving this amendment 103, which also spoken to by the noble Baronesses, Lady Bennett and Lady Wheatcroft. Ensuring that those who are responsible for the most egregious acts of corruption are held to account is obviously vital. There should be no tolerance towards those who steal from the public to satisfy personal greed. The Government wholeheartedly endorse the premise that this amendment seeks to advance. The international community can and must do more to deter and punish acts of corruption.

The Government are taking robust action to ensure that the UK leads by example. That is why, in March, we published the second public-private economic crime plan, to which I referred in our debate on the previous group of amendments, which outlines ambitious actions to prevent the UK’s open economy being exploited by criminals and corrupt actors. The Government are also developing a new UK anti-corruption strategy to build on the progress made by the previous strategy and outline a refreshed approach to tackling corruption and illicit finance both in the UK and internationally.

The recently published fraud strategy also sets out the Government’s commitment to raise the priority of fraud on the international stage. We will drive forward global action through developing stronger relationships with international partners, culminating in a global fraud summit chaired by the Home Secretary and held in the UK next year. The summit will bring together leaders from Governments, law enforcement and the private sector to announce the ambition to deliver a comprehensive and co-ordinated approach to tackling fraud over the next five years.

The Government have consistently invested in efforts to bring those responsible for corruption to justice. The international corruption unit in the National Crime Agency is a specialist capability that investigates corruption cases with UK links.

[Baroness Bennett of Manor Castle (GP)]

On the summit, the problem with ideas such as that put forward by the noble Lord, Lord Ponsonby, about a transatlantic council or similar, is that it would be focused on global north countries. Can the Minister assure me that there will be full representation of global south countries at the summit he just outlined and that the UK will provide resources to ensure that some of the least developed countries, which are some of the biggest victims of this, are also able to participate in that summit?

[Lord Sharpe of Epsom (Con)]

I cannot provide that reassurance; I do not know who will be involved, but I will endeavour to find out and will write.

I shall return to where I was in my speech. In addition, the UK leads and hosts the International Anti-Corruption Coordination Centre—the IACCC—which brings together specialist law enforcement officers from multiple agencies around the world to tackle allegations of corruption. The IACCC has helped to secure convictions in high-profile money laundering cases, including in Malaysia and Angola. In 2022 alone, the IACCC identified more than £380 million of stolen and hidden assets.

I forgot to mention part of my previous paragraph. Since 2006, 30 people and companies have been convicted of corruption offences and more than £1.1 billion of stolen assets have been frozen, confiscated or returned to developing countries. That is in relation to the international corruption unit in the NCA.

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[Lord Browne of Ladyton (Lab)]

I am conscious that I did not contribute to the debate on this, but is it too late to get the word “anti-corruption” into the communique for the pending G7, which takes place between 17 and 23 May in Hiroshima? That word is nowhere in the Foreign Ministers’ communique on 19 April after they met, I think, in Japan. The communique covers almost everything in which one can imagine we would be interested in involving those countries that share our values, but that is not there.

[Lord Sharpe of Epsom (Con)]

The noble Lord will not be surprised to know that I do not know, but I will ask.

The Government will endeavour to update your Lordships’ House on their plans for progressing international action on corruption in due course. I hope the noble Lord, Lord Hain, and the noble Lord, Lord Oates, on his behalf are reassured by the Government’s commitment to combatting corruption. We look forward to further discussions on this subject and to setting out our plans in further detail at an appropriate time. I therefore ask the noble Lord to withdraw his amendment.

Turning to Amendment 106A, tabled by the noble Baroness, Lady Bennett, the Government care deeply about tackling tax evasion and avoidance. My ministerial colleagues continue to work closely with the various sub-committees that sit within the UN’s Economic and Social Council. However, standard-setting powers on tax currently sit within the Organisation for Economic Co-operation and Development’s inclusive framework and global forum, and the UK believes that this is the mechanism best placed to deliver consensus-based reforms aimed at tax avoidance and evasion.

The inclusive framework and the global forum have wide and diverse memberships of more than 140 and 160 countries respectively. Furthermore, the OECD holds strong technical expertise in matters of international tax avoidance and evasion, and a potential UN convention on global tax evasion as envisaged by this amendment would duplicate and be likely to hinder the OECD’s work. This would delay the co-ordinated global response and effort to address tax evasion and avoidance and combat harmful tax practices, as well as creating divergence in international tax standards.

Having said that, the UK will engage constructively with the upcoming report by the UN Secretary-General. We want to find ways to improve international co-operation, as I have said, but to do that we want to ensure that this captures the full range of existing mechanisms for international tax co-operation and considers creatively how they could be improved better to meet developing countries’ needs. We have submitted evidence to the UN Secretary-General demonstrating these points.

Having said all that, obviously I ask the noble Baroness not to move her amendment.

[Lord Oates (LD)]

My Lords, I thank all noble Lords who have spoken in this debate; I particularly thank the noble Baronesses, Lady Wheatcroft and Lady Bennett, for their support. I am sympathetic to the amendment tabled by the noble Baroness, Lady Bennett. I am grateful to the Minister and the noble Lord, Lord Ponsonby, for their thoughtful responses. I am disappointed by the Minister’s conclusion, obviously, but I hope that, as he suggested, we can continue those discussions going forward.

I want to reassure the noble Lord, Lord Faulks, that my purpose was not to come as a critic of the Government. Indeed, I highlighted commitments made by the Government in the Integrated Review Refresh and I commend the Minister for Development and Africa on his real focus. He understands how important this is. Overseas development assistance is nothing compared to getting this right.

I am not sure that I share his views on the International Criminal Court and other international criminal tribunals. One of the great proponents of this international anti-corruption court is retired Justice Richard Goldstone. He was the chairman of the international criminal tribunal on the former Yugoslavia, which convicted a number of key figures including Ratko Mladić and Radovan Karadžić. It does have impact. We should be aware that, even for the non-signatories of the ICC, it has consequences. It has consequences for President Putin that he has been indicted, such as consequences on whether he can travel to BRIC countries that are signatories to that court.

On the charge of being aspirational, I plead entirely guilty. You cannot get real change in the world unless you are aspirational. Of course, as I said in my opening speech, this amendment is not a panacea; it is one tool. One of the most important things, as the noble Lord, Lord Faulks, said in his remarks, are the enforcement powers that we have in the UK, which, in my view, we are not using as much as we should be. I hope that, through this Bill and other means, we will do much more on enforcement.

As we have heard in the previous debate and amendments, this is really about the mechanisms to enforce lots of things; it is not about the laws. There are loads of laws on this stuff generally; it is about enforcement mechanisms. The international court would be another enforcement mechanism but, of course, we need enforcement mechanisms at home.

With that, I thank everybody who has taken part in the debate and I beg leave to withdraw the amendment.

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[Lord Ponsonby of Shulbrede (Lab)]

My Lords, I support this amendment. As the noble Lord, Lord Agnew, said when he introduced it, cost exposure for prosecuting authorities can pose a real hurdle to their pursuing those prosecutions. As he also said, the Rubicon has been crossed in allowing cost capping, which the Government did in March 2022. This amendment has real legs—if I can use that phrase—and I hope the noble Lord presses the matter further, perhaps at later stages of the Bill.

I too was at the briefing with Bill Browder. I am currently reading his second book, having read his first, and it is compelling reading. He is a very brave man. I also agree with the comments made by the noble Baroness, Lady Bowles. I think she said: the precedent and the need are there, and the solution is here. I agree with those sentiments.

Finally, I thank the noble Lord, Lord Trevethin and Oaksey, who set out, interestingly, that some judges in the civil courts have developed their own law on this matter regarding the enforcement agencies not necessarily having to bear all their costs. He gave an interesting example of a further precedent, if you like. I too will be interested to hear the Minister’s response to that. The matter will be considered very carefully with regard to the later stages of the Bill.

[Lord Sharpe of Epsom (Con)]

My Lords, I thank my noble friend Lord Agnew for tabling this amendment and all noble Lords for the points they have raised in this debate. Again, I reassure the Committee that the Government take economic crime very seriously and are taking the necessary steps to ensure that enforcement agencies can tackle illicit financial activities while upholding the fundamental principles that govern our entire civil justice system.

In civil legal proceedings the loser generally pays the legal costs of the winning party, as has been acknowledged. The “loser pays” principle is a fundamental pillar on which the whole basis of civil litigation operates. It helps to ensure that only stronger cases are brought and that the winning party is able to recover reasonable costs of vindicating their case, save for in exceptional circumstances, to ensure access to justice for individuals with very limited resources. While important, civil recovery proceedings brought by enforcement agencies are not so exceptional as to warrant undermining the “loser pays” principle.

Several noble Lords have raised with me, and during this debate, the changes made to the unexplained wealth order regime by the Economic Crime (Transparency and Enforcement) Act 2022. These amended provisions in the Proceeds of Crime Act—POCA—introduce “costs protection” for enforcement agencies in cases of UWOs, unless they act unreasonably. This aimed to remove barriers to the use of UWO powers by relevant law enforcement teams. This was done on the basis that they were exceptional and likely to be low in volume in comparison to other types of civil recovery and, furthermore, that the relevant cost rules would be positioned as a novel and unique proposal, thereby maintaining the overall integrity of the “loser pays” principle in all other civil recovery proceedings. In the last five years, agencies with civil recovery powers—the Crown Prosecution Service, the National Crime Agency, the Serious Fraud Office, the Financial Conduct Authority and HM Revenue and Customs—have not paid any adverse costs for civil recovery proceedings.

There is also no guarantee that the introduction of further costs protection would lead to enforcement agencies pursuing more cases, as they report that each case must be assessed on its own merits considering numerous factors independent of costs liability, including gathering sufficient evidence to pursue a case and internal resourcing capability.

It is also worth bearing in mind that the Civil Procedure Rules, which guide the courts in procedural matters—I think this goes some way to answering the points raised by the noble Lord, Lord Oates—

[Baroness Bowles of Berkhamsted (LD)]

As I interpret what the Minister has said, if the regulator is taking the costs risk into account, that means it will take into account the question: am I up against a really wealthy opponent? Therefore, we will not have equal justice. You are saying that if the person from whom you are trying to recover the asset is particularly wealthy, they will be able to string out the process and do more appeals. That increases your costs risk and, therefore, the wealthy will not be pursued as much as the less wealthy. That is a very bad precedent and another reason why the amendment in the name of the noble Lord, Lord Agnew, is surely needed.

[Lord Sharpe of Epsom (Con)]

The noble Baroness makes an interesting point. I was talking about unexplained wealth orders in respect of the Economic Crime (Transparency and Enforcement) Act 2022. To go over that again, it aimed to remove barriers to the use of UWO powers by relevant law enforcement teams, but it was done on the basis that these were exceptional and likely to be very low in volume in comparison to other types of civil recovery. I do not think that is inconsistent with the argument about this amendment.

Going back to the procedural rules, which guide the courts in procedural matters, these enable judges to use their discretion to limit legal costs in certain circumstances. In appropriate cases, they may be used by agencies when pursuing asset recovery cases and are therefore a more suitable way of limiting costs liability in the few circumstances where this may be needed rather than through wholesale reform of the loser pays principle in civil recovery.

The amendment would overturn the very basis on which the entirety of civil costs and funding is built. It would negatively affect every other category of civil litigation, all for minimal, if any, financial savings in a very limited number of cases—

[Lord Agnew of Oulton (Con)]

Could my noble friend explain why this overturns precedence, while the Act last year on unexplained wealth orders does not? That is why I am so confused.

[Lord Sharpe of Epsom (Con)]

My Lords, I think I have already explained it, but I will endeavour to do so in greater detail in writing, if that is acceptable.

In a very limited number of cases, law enforcement would be involved. If parties in civil litigation do not fear having to pay adverse costs, it risks encouraging spurious and unmeritorious claims. On this basis—and I will write—I ask my noble friend to withdraw his amendment.

[Lord Agnew of Oulton (Con)]

I thank my noble friend the Minister for his explanation. I am afraid that I do not accept it, but I understand the convention that I need to withdraw my amendment. However, I will need to bring this back on Report; it is fundamental to our attempts to get a grip of economic crime in the system. I ask the Minister to reflect not only on my comments but those of other Peers who have supported the amendment and, indeed, the noble Lord, Lord Trevethin and Oaksey, who has come up with yet another example that I was not familiar with.

I was clear in my amendment that there is absolute protection against overreach by government agencies that are seen to act unscrupulously, so I do not accept that there is a risk. We know that we are not going to fund these agencies properly. Common sense tells us that they have to do a very careful risk analysis of any case they take on. If they think they have less than an 80% chance of winning it, they will not do it. I know that from my own experience as a Minister. Time and time again, early on in my career as the Academies Minister when I was trying to root out fraud there, I was told that the risks were too high and that we did not have the budget if we lost the case. It is not complicated.

I urge my noble friend the Minister to reconsider. My noble friend Lord Leigh was right—when we heard from Bill Browder a few weeks ago, he was adamant that, if there is one thing this Bill should do, it is to bring in this costs cap so that we can weaponise the agencies to go after economic crime. I beg leave to withdraw my amendment.