Russia (Sanctions) (EU Exit) (Amendment) (No. 2) Regulations 2022

Lord Collins of Highbury Excerpts

Thursday 3rd March 2022 Lords Chamber

To prevent the slow and steady creep back to normality the Government could act by publishing risk registers of those who they believe will be in scope and disclosing publicly those who are lobbying against these measures, or indeed, lobbying for them to be delayed. Full transparency will be the enemy of those seeking to avoid these measures, in many respects. I hope the Government will consider actions to prevent that kind of flight, which we all know is regrettably happening now.

[Lord Collins of Highbury (Lab)]

My Lords, I too fully welcome the introduction of these sanctions. The Government will have our full support in holding Putin and his acolytes to account. I believe—and I said this earlier to the noble Lord—that the noble and learned Lord, Lord Clarke, is right; these sanctions are about not only how effective they will be, but how sustainable they will be. We need to focus on their sustainability as much as their effectiveness.

I reiterate the promise of the shadow Minister for Europe, my honourable friend Stephen Doughty, that we will work with the Government at speed to pass any necessary legislation to this effect. Russia’s invasion is an act of barbarism which requires a united response from all who value the principles of sovereignty and democracy, which must include measures to exclude it from the benefits of the global financial system.

Reflecting all contributions from noble Lords today, our only ask is that the Government go further and faster. I said this morning in Oral Questions that one of the problems with the strategy of ratcheting up is that there is an element of forewarning, which obviously has an effect. In the areas of asset freezing of Russian banks and oligarchs, there is a serious risk of asset flight. The noble Lord, Lord McDonald, mentioned this point very effectively. I asked the Minister this morning whether there has been any preliminary assessment of whether this has already happened. That is one of the things in terms of preparation. Like other noble Lords, we welcome the new legislation to set up a register of overseas entities holding UK property, but the decision, as noble Lords have pointed out, to delay its introduction for 18 months clearly allows oligarchs to escape sanctions.

I also mentioned to the Minister earlier that Labour’s Front Bench on the legislation in the House of Commons has tabled measures to require the new register to come into force within 28 days of the legislation passing. I hope that the Government accept this amendment. It is important that we remain united, as I have said before, as a Parliament and a country.

The steps taken to cut Russia out of the western economic system are particularly welcome, and the efforts on SWIFT and the Government’s push to get a global response to that has been really important. It has been well known that Russia has been developing alternatives to SWIFT since calls first emerged for Russia’s exclusion during the invasion of Crimea. I hope that the Minister can update the House on what assessment the Government have made of Russia’s potential for developing an alternative, again picking up a point made by the noble and learned Lord, Lord Clarke, about the sustainability of our actions.

Given that not all Russian banks are currently included, the Government are right to call for an expansion. Has the FCDO had any recent high-level conversations about that? The Government should also consider how they can widen the number of banks that are prevented from accessing sterling and expand sectoral sanctions. The Minister mentioned those, but we should even be thinking of the insurance market. There are other areas and the noble and learned Lord, Lord Garnier, was right to focus on the interest groups that may have the most influence on Putin and his acolytes. I agree with the points he made. One not insignificant idea on export controls is to look at the luxury goods going into Russia. We know that cars are included, but there is a whole other range. That visibility could address the point made by the noble and learned Lord about soft power and how we raise awareness in Russian people’s minds about the impact of their Government’s action.

The designation of further individuals was highlighted by the noble Lord, Lord McDonald, and the point was raised on Radio 4’s “Today” programme. The Prime Minister suggested that more than 100 further persons could now be sanctioned. It is clearly now possible that those with links to the Kremlin will use that as a warning to sell their assets. We have seen that the Chelsea owner, Roman Abramovich, is seeking to offload the club, with a price tag believed to be £3 billion. His multimillion-pound residential properties are also up for sale. He says that proceeds will be donated to good causes, but the truth is that we will never know where that money will ultimately end up. Does the Minister believe that Mr Abramovich’s actions have been driven, at least in part, by the Prime Minister’s incorrect assertion that he was on the UK sanctions list? Do the Government agree that any form of pre-notification, or indeed inclusion of grace periods for certain banks, severely undermines the effectiveness of sanctions? I have heard the Minister repeatedly say in the Chamber in the past that he will not indicate or respond about future designations because it does precisely that.

We need to return to the point about how fast we designate people. When the Government extend their designations—I hope that will be soon—I hope that they will allow parliamentarians to suggest further targets. We had this debate about the mechanisms for informing the Government and the FCDO about possible targets when we debated the sanctions Bill. That intelligence may go beyond normal intelligence service facilities, but we should be open to those sorts of suggestions.

Finally, we must all remember that Russia is supported by Belarus and treat Lukashenko’s regime as belligerent. The sanctions announced against individuals in Belarus are a step in the right direction, but we should consider other options for deterring their involvement. Do the Government plan to match the measures announced by the EU for banning machinery exports to Belarus? As the noble and learned Lord, Lord Clarke, said, it is misguided to think that we have time on our side. For as long as the Kremlin continues this campaign of violence, we must hold to account all those who enable it. We welcome these sanctions but look forward to further measures being brought forward on a speedy basis.