Russian Assets: Seizure

Debate between Anna McMorrin and Iain Duncan Smith

Tuesday 14th March 2023 Commons Chamber

[Sir Iain Duncan Smith]

I want to make a bit of progress, just in case my right hon. Friend is about to tell me what I have got here in my speech. Forgive me if I just get ahead of it, because everyone else will probably do the same.

Let us have look at the costs of the war, which are really what this is all about. Ukraine’s death toll is 60,000 and it is rising every day. The cost of reconstruction is now estimated to be between $750 billion and $1 trillion and rising, and these might be conservative estimates because the damage is still not fully accounted for. Since the beginning of the invasion, the UK has provided £2.3 billion in military assistance and another £220 million in humanitarian aid. The UK has frozen billions of pounds in Russian assets under sanctions following the invasion of Ukraine. The Office of Financial Sanctions Implementation has reported that £18 billion of assets owned by individuals and entities associated with the regime have been frozen since the beginning of the war, but some estimates suggest that more than £40 billion could yet be frozen and this is the point we want to get to.

[Anna McMorrin (Cardiff North) (Lab)]

I, too, have just got back from Ukraine. I was there a couple of weeks ago and saw the immense devastation across the country, specifically in those areas that were Russian held. Importantly, this Government looked at plans to repurpose assets last July but they still have not done it. Does the right hon. Gentleman agree that it is now imperative for the Government to look at repurposing those state assets in order to start rebuilding and restructuring the country and offering that important aid?

[Sir Iain Duncan Smith]

I absolutely agree with the hon. Lady.

I want to talk about what Russian state assets are frozen and what could be frozen. It is important to note that, in Congress right now, they are already discussing this—I spoke to someone there just 24 hours ago—and in Canada, they are seriously talking about it. European Parliaments are also discussing the matter. This is a moment for us to give a lead on this and help to shape the nature of it, as we have a conference coming up shortly and I wonder whether that might be the place to lead on this matter.

According to the Bank of Russia’s own 2021 annual report, £26 billion of Russian state reserves are in the United Kingdom and, on a wider level, western Governments have now frozen some $350 billion of Russian central bank reserves in response to the invasion. There is yet more that they could do. The combined value of frozen UK properties belonging to Russian oligarchs is at least £2 billion. Funds frozen under the UK sanctions regime are passive, and that is the problem. Those funds would enable us to finance the rebuilding of Ukraine and to show Russian dirty money the door. This is the key: we send the message and we help with reparations. Several countries, including Canada, as I said earlier, and the EU are already on to this process and I urge our Government to help to give a lead on this.