Sanctions

Lord Beamish Excerpts

Tuesday 22nd February 2022 Commons Chamber

[Mr Lammy]

My hon. Friend is exactly right. I have already seen Ukrainian MPs saying today that they are disappointed that our sanctions regime does not go further.

We have sought to send a unified message across this House and to provide constructive opposition in the national interest. It is in that spirit that we approach today’s announcement. As the Minister knows, while we welcome these measures, we believe that they are too limited and too partial—five banks and just three individuals. The Prime Minister recognised at the Dispatch Box today that this move is a further invasion of Ukraine. It is very hard to square the rhetoric with the reality of these measures.

[Mr Kevan Jones (North Durham) (Lab)]

I have to agree with my right hon. Friend about the limitations of the sanctions on those individuals. However, does he agree that if the regulations’ definition of “involved person”, especially the reference to being

“involved in…obtaining a benefit from or supporting the Government of Russia”,

is interpreted widely with the right political will, it could take in a lot of individuals who have a lot of money salted in the UK, including a lot of the oligarchs who have property or other interests here?

[Mr Lammy]

My right hon. Friend is exactly right: it could, but it needs enforcement and we need to hear more individuals named. The danger in this debate is that the punishment does not befit the crime. I understand the Government’s desire to maintain a broader deterrent against further escalation, but it is also clear that a threshold has been crossed. The gravity of Putin’s actions requires a broader, firmer and fuller response, otherwise we risk his calculating that the rewards of aggression outweigh the costs.

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[Mr Kevan Jones (North Durham) (Lab)]

Like others who have spoken, I welcome the regulations that we are discussing tonight, but I am underwhelmed by the announcement today of the Government’s sanctions. I have to say that I do not really understand the ratchet option. What we need now is a hard stop and tough action against the Russian Government.

These regulations are long overdue. I agree with the hon. Member for Isle of Wight (Bob Seely) that we are closing the stable door after the horse has bolted. What is happening in Ukraine today was summed up well by the right hon. Member for Maidenhead (Mrs May), who said that we are seeing not just an attack on the sovereignty of the independent state of Ukraine, but an attack on our western values and the right of free people to decide their own future.

This has not happened by accident. We had the Foreign Affairs Committee’s 2018 “Moscow’s Gold” report and the ISC’s long-delayed 2020 report on Russia—I sat on the latter Committee—and those reports laid out all the issues. I am baffled by the Government’s reluctance to act against the Putin regime.

I agree with the hon. Members for Tonbridge and Malling (Tom Tugendhat) and for Stirling (Alyn Smith) that we have no problem with the people of Russia. In fact, I would say the Russian people are the victims of Vladimir Putin and his regime. We have to understand that over the past 10 to 15 years this individual has been in control with a group of kleptocrats around him. If we are to get him to wake up and listen, we have to attack those individuals.

The hon. Member for Oxford West and Abingdon (Layla Moran) named some of those individuals, and they are known to people. It is not a great secret, as my right hon. Friend the Member for Birmingham, Hodge Hill (Liam Byrne) said. There is an option to identify individuals under proposed new regulation 6(4):

“For the purposes of this regulation, being ‘involved in obtaining a benefit from or supporting the Government of Russia’”.

There is no way that any of these individuals, who are doing business in Russia and have laundered money sitting in this country, could operate without supporting the Government of Russia, so I think there is an option to do it under these regulations. [Interruption.] The Minister is gesticulating that that is the point, and I agree with him, but the big issue is not whether it is in the regulations but whether it will be acted on by the Government. I am sorry, but this Government’s record so far has not been good.

There is an opportunity to do what the hon. Member for Oxford West and Abingdon suggests, and we now need to see action. The Russians will be baffled by the limitations on the sanctions that have been announced, and some of them will be laughing. They will think, “That’s what the UK has announced today. We’ll do a bit more and they’ll do something else tomorrow.” No, we need a hard stop now, and these regulations give us that opportunity, but the Government have to follow through.

Ken McCallum, the director general of MI5, was interviewed for the Daily Mail last week. He is the head of the Security Service, and he was venting his frustration in public that the laws to tackle spying are outdated, that the Official Secrets Act is no good, that the promised espionage Bill is not forthcoming—as someone said, the United States has had such an Act since 1938—and that there are issues with beneficial ownership and the reform of Companies House.

Those things were all laid out in the Foreign Affairs Committee’s report, and reinforced in many ways by the ISC’s 2020 report. We have a Government who seem to be sitting back. The invasion of Ukraine has now focused their attention, but we cannot allow this to continue. As the right hon. Member for Maidenhead said, this is an attack on our way of life and our democracy, which we all take for granted.

We will support these regulations tonight, but we also have to take action. The Government should make legislative time for the economic crime Bill and the other measures, as I am sure they would have united support on both sides of the House to get them on to the statute book. We now need action, not talk.

The Government also have to ensure that their communications are a damn sight clearer than they have been to date, because otherwise we are feeding our enemies who are now threatening the brave people of Ukraine.

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[James Cleverly]

I will rush on, because I was excessively generous earlier. The question was asked: will these sanctions be escalated only in response to further aggression? I can assure the House that these sanctions will be ratcheted up because of what has already happened, and not just in response to what might happen in the future. Our intention is to prevent even further invasion of Ukraine, to have those troops who are in Ukraine removed, and then to have them return to their home barracks once they are back in Russia. That is our ultimate aim, and the ratchet effect will be done to pursue that as a strategic aim.

There have been questions about asset flight. We are very conscious of this, and that is why we are not explicitly naming people or institutions that may be subject to future sanctions. It is also why it is very important that we work hand in hand with our international allies and friends, who are just as determined as we are to address this situation.

The shadow Foreign Secretary, the right hon. Member for Tottenham (Mr Lammy), compared what we have announced today unfavourably with what our allies say they are going to announce. If I were to say that this sanctions package is as far as the Government are willing to go, that might be a legitimate criticism, but the point we have made is that, just as our friends and allies intend to go further, we intend to go further. I have given some suggestions about where that additional ratchet effect may be focused, but we reserve the right to explore whatever is necessary to dissuade further aggression and to force Vladimir Putin to withdraw the troops that have entered Ukraine.

Questions were asked about the application of this statutory instrument in the OTs. This SI does cover the OTs. Members asked whether individuals who may not be in direct managerial or ownership roles would be subject to these sanctions. This SI is worded specifically to be broad in scope. I think implicit in the question my hon. Friend the Member for Huntingdon (Mr Djanogly) asked was that it might even be too broad in scope, but I can assure the House that it was written specifically to be broad in scope so that the ownership maze often put in place to hide the beneficiary of ownership can be addressed.

There have been some questions about family members. A family member is caught within scope where they are acting for or deriving benefit from their relationship with the Russian Government. However, just being the relative of someone who may be subject to sanctions is not necessarily enough on its own. There need to be reasonable grounds, and we always act with reasonableness, although we do act with firmness.

In the debate, it has sometimes sounded as if the only Russians subjected to UK sanctions are the ones who were named by my right hon. Friend the Foreign Secretary this morning. It is worth reminding the House that 58 entities and 186 Russian individuals are currently subject to financial sanctions under the Russia regime, including the ones designated today. There are already limitations on the activities in the UK of SberBank, VTB bank, Gazprombank and others, and as I say, we will not speculate on where future sanction designations may land.

Across the House, my right hon. and hon. Friends—including my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith) and my hon. Friends the Members for Isle of Wight (Bob Seely) and for Tonbridge and Malling (Tom Tugendhat)—have called on us to do more, and their message was absolutely echoed, very effectively and eloquently, by the right hon. Member for Birmingham, Hodge Hill (Liam Byrne), my shadow, the hon. Member for Cardiff South and Penarth (Stephen Doughty), and the hon. Members for Stirling (Alyn Smith) and for Oxford West and Abingdon (Layla Moran). I hear—the Government hear—exactly the points that they are making.

The hon. Member for North Durham (Mr Jones)—

[Mr Kevan Jones]

Right honourable.

[James Cleverly]

Right honourable. Exactly. It is appropriate to say that; apologies. The right hon. Member for North Durham made a point about what this framework enables us to do. This is the point we are making: this is legislation that enables us to apply sanctions very widely indeed and we will always do so in the way we believe to be most effective: that is, hand in hand with our friends and allies. We will repeat the message that the people of Ukraine have suffered enough. The aggression and intimidation must end. This will form part of our response to Vladimir Putin’s aggression. We will work towards a time when the people of Ukraine no longer live under the intimidation of Vladimir Putin, and indeed, as has been made clear by a number of Members around the House, the people of Russia can again enjoy a relationship with other countries around the world not tainted by the actions of this individual.

Question put and agreed to.

Resolved,

That the Russia (Sanctions) (EU Exit) (Amendment) Regulations 2022 (SI, 2022, No. 123), dated 10 February 2022, a copy of which was laid before this House on 10 February, be approved.