Criminal Finances Bill

Lord Herbert of South Downs Excerpts

3rd reading: House of Commons & Report stage: House of Commons
Tuesday 21st February 2017 Commons Chamber

For those reasons, I hope that the Minister will reject new clause 6, well intentioned though it is, and instead work with right hon. and hon. Members concerned about this whole issue and make sure that in due course we persuade more and more countries around the world to work together and ensure a uniform approach in the future.

[Nick Herbert (Arundel and South Downs) (Con)]

I rise to support new clause 6, to which I added my name in the full confidence that I was merely endorsing what I understood to be Government policy on ensuring transparency on these matters in the overseas territories, that policy having been announced by the previous Prime Minister. I find myself genuinely puzzled, therefore, about why that is apparently no longer Government policy, and I wish to raise some issues and put some questions that I hope the Minister can answer so as to reassure me and other hon. Members who have supported the new clause in good faith that there are good reasons why it should not go forward.

First, I thought that the argument about transparency had been established. My right hon. Friend the Member for Cities of London and Westminster (Mark Field) suggested that transparency would, in itself, be an undesirable thing for the overseas territories to have to undertake, but it seems to me that we might well have applied that argument to the position in the UK. Had we accepted that argument, we would not have taken action here in the UK to require transparency.

[Mark Field]

It is fair enough that I be allowed to defend myself. I was making the point that while I favoured full transparency towards law enforcement agencies and the tax authorities, I did not support there being a full, open and public register at this stage, because I supported the idea of banking privacy.

[Nick Herbert]

I am grateful to my right hon. Friend for clarifying what he said, but my point still stands, which is that we have taken action in the UK to require such publication. Why is it right in the UK but wrong in the overseas territories? That was the point I was seeking to make. Perhaps the Minister can explain.

Secondly, I understand that constitutional objections have been raised to the new clause. The argument is that it would be wrong to insist that the overseas territories take action. If so, why did we propose it in the first place? As a result, hon. Members like me now find themselves on the wrong side of the Government’s opinion, when we thought we were supporting a policy in our manifesto. If there is a constitutional objection, was it not surprising that the previous Prime Minister announced the policy of transparency for the overseas territories?

Is it even right that the British Government never impose policies on our overseas territories? In 2000, the Government, by Order in Council, decriminalised homosexuality in the overseas territories. I doubt that many Members would oppose that policy, although I suspect it was opposed in many of the overseas territories. Do hon. Members say that the British Government were wrong to do that? Murder might still be a capital offence in some of the overseas territories had the Government not insisted on the abolition of such capital crimes in 1991. The principle is established that the Government are constitutionally entitled and have in practice, where there is an overriding public policy justification, legislated in relation to the overseas territories.

The third argument advanced against this measure is that the overseas territories are doing it anyway. We are told that it is not necessary to back new clause 6 because the overseas territories are well on their way to doing the right thing, but that takes us back to the question of what it is that they are doing. If they are producing registers, that is welcome, but my question still stands: why did we think transparency was a good thing, but now no longer believe that it is a good thing? We have reset that bar. We are now saying that the overseas territories are on their way to doing the right thing, but the right thing is now defined merely as the register, and it is no longer transparency.

I think the reason this has happened has been revealed by some of my hon. Friends for entirely honourable reasons, and it is that some of these overseas territories and therefore some of my hon. Friends fear that there will be a competitive disadvantage for the overseas territories if they are required to produce a public register as the new clause suggests, in the way they will eventually be required to do, and as the Government suggested at one point that they should.

However, let me say simply that if we accept the argument that being at a competitive disadvantage is an obstacle to taking measures against tax evasion or corruption, this House would do very little on those issues. It can always be argued that we could be putting our own banking arrangements or those of other countries at risk by taking steps deemed to be in the public interest on the grounds that they could produce corruption. To turn that around, if we accept the argument on competitive disadvantage, there would be no reason why the House should not reverse all the measures taken on banking transparency and establish some sort of regime that used to pertain in countries like as Switzerland where there would be wholesale banking secrecy, because that would be good for business and it would place us at a competitive advantage by comparison with other countries. It could be argued that such a thing would be entirely acceptable.

Clearly, that would not be acceptable. We have taken the opposite view: there is a reason to demand transparency and that transparency is essential in order to tackle corruption. We are talking about measures that are necessary to protect not just the UK taxpayer but the poorest countries in the world, which are disadvantaged and penalised because people are able to siphon off funds unlawfully and immorally and shelter them in various regimes. We are apparently saying that we are willing to accept that, because if we take action against it, some other regime will perform that immoral task. That seems to me to be a wrong position for the House of Commons to take, and if it were accepted, we would not have a Bill such as this one or any transparency measures at all.

I therefore hope that the Government will reconsider their position. New clause 6 is entirely reasonable, providing a period of time for the overseas territories to comply with the transparency requirement. I, for one, will take a great deal of convincing that something that was held by the Government to be desirable and that we hold to be desirable and right in our own country is wrong for the overseas territories.

[Mark Field]

I have spent the last 16 years as the Member for Cities of London and Westminster, and six of those years as an adviser to an international law firm with a substantial Isle of Man presence—Cains. Over the last two years, I have been the vice-chairman for international affairs for my party and have therefore had many dealings with and much knowledge of these sorts of issues.

I fervently agree with the right hon. Member for Don Valley (Caroline Flint) and my right hon. Friend the Member for Sutton Coldfield (Mr Mitchell) that there has been a significant journey—indeed, a massive change—with respect to the mentality around beneficial ownership, getting registers together and having a certain openness about those registers. It is a journey that is ongoing.

I think it realistic to believe—my hon. Friends the Members for Bromley and Chislehurst (Robert Neill) and for North West Norfolk (Sir Henry Bellingham) presented some powerful arguments in this regard—that there is a real risk of competitive disadvantage applying to a number of the overseas territories. As my hon. Friend the Member for Bromley and Chislehurst pointed out, and as was recognised by the right hon. Member for Don Valley, the Crown dependencies are in a different legal and constitutional position. They are not part of the United Kingdom. They have their own legitimate and democratic Governments, and I think it would be quite wrong for the Government to railroad them, whether by means of Orders in Council or through the Bill.

My instinct is that we shall return to these issues. I support the Government: I do not think that the time is ripe for a provision such as new clause 6. It would, however, be wrong to assume that a huge amount of work has not been done quietly behind the scenes. I know from my own experience, and the experience of many other people, that in recent years there has been a sea change in the attitudes of a number of the overseas territories, and certainly in those of the Crown dependencies, many of which are ahead of the game when it comes to elements of the transparency agenda. I think there is a real risk—which was very well described by my hon. Friend the Member for North West Norfolk—that if we were to impose this provision on the overseas territories in such short order, a huge amount of business would leave those shores. Some would say, perhaps with some legitimacy, “We do not want to have this business here.”

I believe that we should continue the work of recent years, and consider global protocols that would prevent competitive disadvantage from coming into play. Surely that would be a better regime. I think it entirely wrong to perceive all our overseas territories as terrible tax havens where illicit work goes on. They have an astonishing amount of technology, which I have seen at first hand in, among others, the British Virgin Islands and the Cayman Islands, to enable them to co-operate instantaneously with law enforcement and tax authorities in the event of any suspicious transactions.

I hope that new clause 6 will not be pressed to a vote, or that the Government will win if it is. However, I also hope that the Minister will give us some idea of how he sees the future, given the ongoing conversations about a global protocol that we could all support.

--- Later in debate ---

[Mr Wallace]

We find criminals using banking systems all over the world to hide their money, whether that is in Northern Ireland, London, the Republic of Ireland, Crown dependencies or elsewhere. Such places have agreed to work with our law enforcement agencies, and we will allow their law enforcement agencies access to our databases in order to follow up such activity.

The hon. Member for Ealing Central and Acton underplays the success of the United Kingdom’s leadership role. Without imposing on democratically elected Governments in those countries and without imposing our will in some sort of post-colonial way, we have achieved linked registers and access to registers for our law enforcement agencies across many Crown dependencies and overseas territories. We might compare ourselves with our nearest neighbours, the major economies—with all due respect, I do not mean Christmas Island—such as Germany and other European neighbours such as Spain. We are the ones with a public register and we, not them, are the ones ready to have a unified central register. Perhaps we should start by looking at the major economies, rather than sailing out on a gunboat to impose our will on overseas territories that have done an awful lot so far in getting to a position in which I am confident that our law enforcement agencies can bring people to justice. That is the fundamental point of this principle. We have not abandoned our ambition. We have decided that the way to do it is not to impose our will on overseas territories.

The Labour party’s new clause 17 is probably constitutionally bankrupt, if I may use that phrase. It would certainly cause all sorts of problems, although I am not sure that we can actually impose our will on a Crown dependency like that. All the good words of the hon. Member for Ealing Central and Acton seem to have disappeared because the new clause leaves out overseas territories and would apply only to Crown dependencies. If Labour Members think that such a provision is right for Crown dependencies, why is it not right for overseas territories? I do not understand why they have left that out, although I suspect it is because, when it really comes to it, Labour Members do not know what they are talking about. If the Labour party wanted to be successful with this, it might have done it in its 13 years in Government.

I respect devolution and constitutional arrangements, and it is important to do that at this stage. Crucially, if we do this in partnership, we will get there. When we see people being prosecuted and the system of information exchange between law enforcement agencies working, we will have arrived at a successful point. I am confident that we will get there. I do not shy away from telling the overseas territories and Crown dependencies that our ambition is for transparency but, first and foremost, our ambition is for a central register that is easily interrogated by our law enforcement agencies.

[Nick Herbert]

I welcome my hon. Friend’s restatement that the Government remain committed to transparency. Will he give some kind of indication of a timetable, once his policy of registers is fully in place, by which he expects the overseas territories to be able to move to full transparency?

[Mr Wallace]

The first commitment is for the central register to be in place by June this year. Where overseas territories have trouble fulfilling that—for example, they just do not have the capacity to do it—we have offered help to allow them to do so. Hopefully that means that we will keep on target. As for setting a date for the public register, we first have to complete our own, and get it up and running. Once we know what challenges are involved in doing that and seeing how it works, we can have a grown-up discussion with our G20 partners about when they will do that. We should not just focus on the overseas territories and Crown dependencies. Major economies, including our own, are guilty of allowing people to hide illicit funds, which is why we introduced this Bill. I suspect we will find many funds laundered not in those small overseas territories, but in some major economies in the G20. That is important.

Draft Investigatory Powers Bill

Lord Herbert of South Downs Excerpts

Wednesday 4th November 2015 Commons Chamber

[Mrs May]

As the hon. Gentleman will know, Ministers have to take account of the human rights issue in relation to any legislation that they present to the House. That has indeed happened, and I have every confidence that this legislation will comply with human rights requirements.

[Nick Herbert (Arundel and South Downs) (Con)]

I welcome the Home Secretary’s balanced approach. Is it not important for us to continue to reassure the public that this is not a proposal for mass surveillance, and to restate the essential need for the Bill? There is a new form of technology that is effectively shielded from the law enforcement and intelligence agencies simply because the law has not kept up with technological development, and it is therefore necessary to update the law with essential safeguards in order to ensure that the public are safe.

[Mrs May]

My right hon. Friend has hit the nail on the head. Technology has moved on, but the law has not. We need to update the law so that our law enforcement and security agencies have the powers that they need to continue to keep us safe.

Policing

Lord Herbert of South Downs Excerpts

Wednesday 4th November 2015 Commons Chamber

[Andy Burnham]

I can do no better than refer my hon. Friend to the words of Peter Clarke, former deputy assistant commissioner of the Met’s specialist operations directorate, whom the House will know. Talking about what is in the offing, he said:

“We risk breaking the ‘golden thread’ that runs through the police effort all the way from local communities to the farthest part of the world where, in an era of global terrorism, defence of the UK begins”.

That is the point: that pyramid of policing that begins at a very local level and feeds intelligence into the system is not an either/or idea. We cannot just say that we will have officers dealing with online crime and withdraw people from the streets. We have to maintain a police presence in every community, which is a point that the Government seem not to understand.

[Nick Herbert (Arundel and South Downs) (Con)]

rose—

[Andy Burnham]

However, I believe that the former Policing Minister does understand that.

[Nick Herbert]

I am grateful to the right hon. Gentleman for giving way, and he has been very generous. As I understand it, he is saying that cuts of up to 10% could safely be made now because, as he accepts in the motion, further efficiencies could be made in the police budget. Therefore, by definition, he has accepted that the efficiencies that have been made so far have not damaged policing. He shakes his head, but it is fairly obvious that if further cuts of up to 10% could be made safely he accepts that the reductions that have been made to date have not damaged policing. Is it therefore not extraordinary that Labour Members opposed those reductions in spending and said that policing would be damaged? Why should we believe them now?

[Andy Burnham]

I am glad that the right hon. Gentleman intervened, because I am not saying anything of the kind. I am not saying that the cuts that the Government have managed to date have been without consequence. I have just described how functions as important as managing Remembrance Sunday parades have been cancelled. I have also pointed out that crime is rising and I, for one, do not say that there is no link between police numbers and rising crime. We looked at a plan to protect the frontline by merging police forces. I note that the Government have turned their face against that. It is all about how they do it. The frontline can be protected if the Government are prepared to manage the cuts in a way that takes resource out of the back office. They are not prepared to do that, either, so consequently we are seeing unacceptable cuts in police forces up and down the country.

Water Cannon

Lord Herbert of South Downs Excerpts

Wednesday 15th July 2015 Commons Chamber

[Mr Speaker]

I call Mr Nick Herbert when he has finished consulting his mobile phone.

[Nick Herbert (Arundel and South Downs) (Con)]

I know that the Home Secretary will have taken this decision with great care. I therefore regret to say that I, too, have grave concerns about it. Does it not directly contradict the statement of the Prime Minister during the London riots of 2011 that water cannon would not be taken off the table and that indeed they could be made available within 24 hours? The Home Secretary has not been directly responsible for policing in the capital for 15 years. The elected Mayor has responsibility in that regard and the senior operational commander in London has made it quite clear that he supports the use of water cannon. Surely a riot is a riot whether it is in Northern Ireland or on the streets of London and it is hard to see why it should be dealt with differently. Just this week, water cannon have been used in the Province.

[Mrs May]

I thank my right hon. Friend the former Policing Minister for sharing his views. On the point about comparisons with Northern Ireland, I simply point out that he is talking about water cannon being used in a riot, which—this is important in thinking about their operability—is a fast-moving situation in which circumstances can arise very quickly that require the police to make quick decisions on the use of the tools available to them. Last August, as I indicated in my statement, I wrote to a number of senior officers and serving and former chief constables to ask about the circumstances in which water cannon would be used. In response, the then temporary deputy chief constable of the Police Service of Northern Ireland wrote—his letter will be placed in the Library—that:

“the predominant method of deployment for the PSNI is within a pre-planned public order operation, with cannons deployed to either a reserve, holding or forward location, depending on an assessment of the ‘immediacy’ of use.”

They are pre-planned operations, so the fact that they might be used is known some time in advance. That is a different scenario from a rapidly moving, spontaneous occasion of the sort my right hon. Friend refers to.