Intelligence and Security Committee: Annual Report 2011-12

Lord Taylor of Holbeach Excerpts

Monday 21st January 2013 Grand Committee

[The Parliamentary Under-Secretary of State, Home Office (Lord Taylor of Holbeach)]

My Lords, I am sorry to throw the furniture around; it is not a response to what has been a really helpful debate. It has been extremely well informed, as one would expect from the speakers we have had the privilege of listening to.

Before I turn to the points raised by the noble Lord, I thank my noble friend the Lord of Lothian for opening this debate. I thank my noble friend and the noble Lord, Lord Butler of Brockwell, as the two representatives of your Lordships’ House on the Intelligence and Security Committee, for their hard work and diligence. It is evidently no sinecure, as the former chairman, the noble Baroness, Lady Taylor of Bolton, has demonstrated to us in her observations.

Having started by thanking them, I put the committee into some context. We should not forget the other members of the committee coming from the other place, in particular the chairman, my right honourable friend Sir Malcolm Rifkind. I thank them all for their contributions to the report and I recognise the support provided by the staff of the committee. I am very impressed by the expertise within the committee and the sheer dedication to its role, which is evident in the quality and volume of work that is produced. Acknowledgement should also be given to the agencies and their excellent work. Noble Lords have been unanimous in their praise, and I join in those sentiments. I would particularly like to publicly congratulate them on helping to deliver a safe and secure Olympic and Paralympic Games. The Games were a perfect example of their ability to deliver under pressure and raised still further the agencies’ reputation here in the UK and internationally.

The ISC’s annual report focused on a number of matters of great importance to the Government. I start by addressing the Justice and Security Bill, on which the noble Baroness made some of her concluding remarks. It is, of course, of particular interest to the ISC. As noble Lords will be aware, I had the privilege of leading the Bill through Report stage in this House and participated in its full and thorough analysis. I thank noble Lords for another informative discussion today because Part 1 of the Bill concerns the oversight of the security and intelligence agencies. That is clearly of great importance and interest to the ISC. I agree with my noble friend the Lord Lothian that the new Bill must not put the ISC in a worse position than currently with regard to the oversight of operational matters. We intend to make amendments to the Bill that may be necessary to ensure that that is not the case.

In Committee, the noble Lord, Lord Butler, and my noble friend the Marquess of Lothian made the important point that the ISC must not just be independent but it should be recognised by all as being independent. I agree wholeheartedly with that. The Justice and Security Bill will put the ISC on a stronger footing and enhance its powers, allowing for more effective oversight of intelligence and security matters. It will ensure that the ISC can no longer be open to the unfair accusation that it is just a creature of the Executive.

As I said to noble Lords on Report, it is our intention that the new ISC will be a statutory committee of Parliament, and the Government intend to table an amendment in the other place to make that clear. I hope that the noble Baroness, Lady Smith, will be reassured by that and by what I am further able to say, because we also intend to give the committee bespoke statutory immunities that will provide it with protections that replicate certain aspects of parliamentary privilege. Specifically, I can reassure my noble friend the Lord Lothian that we are considering providing protection to witnesses before the ISC so that the evidence they give in good faith could not be used against them in criminal, civil or disciplinary proceedings. A lot of work is going on at the moment to make sure that the noble Lord’s ambitions for the ISC can be fulfilled. The Government agree that the ISC will require an uplift of resourcing to enable it to undertake its strengthened oversight functions and we are discussing with the committee the precise nature of that uplift.

Part 2 of the Justice and Security Bill has generated the most interest among colleagues and the media, with some unfairly suggesting that it is a tool to cover up agency wrongdoing. It is anything but a tool for cover-ups. Closed material proceedings will in fact allow for more cases involving the intelligence services to be heard, including cases that previously could not be heard at all. Nothing that is currently heard in open court will be heard in secret in the future. The Bill is about ensuring that allegations made against the Government involving intelligence material are fully investigated and scrutinised by the courts, while addressing the potentially severe implications that could arise if sensitive intelligence secrets were disclosed in open court. In response to the suggestion—made by some outside the debate today, I hasten to add—that CMPs are open to misuse, I would emphasise that judges, not the Executive, make the final decision as to whether a closed hearing can take place, and we have put in place safeguards to make sure that that is the case.

I am strongly of the view that the provisions in the Bill are a measured and proportionate response to the challenges we face. I appreciate the work of the ISC and of noble Lords in scrutinising the Bill during its passage through the Lords, and I anticipate that scrutiny in the House of Commons will lead to further refinement of its provisions.

The ISC report outlines major areas of the threat to our national security, including international and Northern Ireland-related terrorism, hostile foreign activity and nuclear proliferation. To ensure we continue to face these challenges appropriately, we need a clear strategic direction. As flagged in the their response, the Government support the committee’s recommendation that it is imperative that policy implications and analytical judgments remain separate in any intelligence assessment provided to Ministers.

I welcome the committee’s recognition of the agencies’ rapid response to the Arab spring. I also understand the committee’s concern that it was not foreseen. I must reiterate the points laid out in our response to the report that, in countries where you have tightly controlling regimes, it is often not possible to predict the extent to which people will take to the streets and demonstrate. It is impossible for our intelligence resources to cover the whole world at all times. The agencies rightly prioritise those countries where secret intelligence can add the greatest value. The challenge is to retain flexible capabilities that can be rapidly deployed to respond to emerging situations, such as the Arab spring—or the Arab awakening, as my noble friend Lord Lothian preferred to call it.

The noble Lord, Lord Hennessy, quoted from our recent past history to illustrate graphically that we still depend on the exercise of judgment in prioritising intelligence gathered and indeed intelligence gathering.

With reference to the Olympics, I am extremely pleased to be able to say that the Games were a triumph for safety and security. Many noble Lords, including the noble Lord, Lord Butler, have referred to this. A considerable amount of work went into ensuring that the Games were secure, and the Security Service had to cope with an increased level of risk across its portfolio of work. It is a testament to the service that it managed this risk effectively and was able to maintain the appropriate levels of resourcing to cover areas of additional potential concern that were not terrorism-related. As the noble Lord, Lord Butler, said, it avoided the risks to the nation as well as to the Games.

A number of noble Lords have rightly talked about cybersecurity as another key theme within the annual report. The Government response explained our approach to improving cybersecurity in the United Kingdom and we will be extending this work going forward. This will include the rollout of a programme of public awareness initiatives, delivered in partnership with the private sector and aimed at increasing cyber confidence and improving online safety for both consumers and businesses. At every level, cybersecurity is an issue and I note noble Lords’ comments that, while they welcome the Government’s funding commitment, there is a need for a sustainable funding stream for this activity into the future.

We are also supporting the development of cybersecurity skills and education across the UK in schools, higher education and beyond, including the “Behind the Screen” initiative to provide cybersecurity education at GCSE level. The future lies in us all being well educated about risks that the failure to provide cybersecurity can bring. I agree with the committee that cybersecurity is a key issue for UK national security and I can reassure noble Lords that the Government take this extremely seriously.

The ISC annual report, quite rightly, refers to counterproliferation as a key issue and references, in particular, concerns regarding Iran and its continuing efforts to enrich uranium in violation of six UN Security Council resolutions. In response, we are committed to a dual-track approach of engagement and peaceful pressure. The past year saw a significant increase of pressure, including an EU oil embargo and enhanced financial sanctions. Iran and the E3+3 grouping, which consists of the UK, France, Germany, the US, China and Russia, met four times to discuss Iran’s nuclear programme and, in December 2012, a further round of talks was offered to Iran. I think that this is the right approach.

The noble Baroness mentioned TPIMs. The ISC report noted its concerns about the new terrorism and prevention investigation measures regime, and there have been suggestions that the abscond of Ibrahim Magag has shown that its concerns were well placed. National security is the Government’s top priority, and the police, security services and other agencies are doing everything in their power to apprehend this man as quickly as possible. I would emphasise that this is not a reflection on the effectiveness of the TPIM regime and that this abscond had nothing to do with the change from control orders to TPIMs. The TPIM Act provides rigorous measures to manage the threat posed by terror suspects who we cannot yet prosecute or deport by limiting their ability to communicate, associate and travel. This is the first abscond by someone subject to a TPIM, and it should be noted that, in the six years of control orders, there were seven absconds. David Anderson, the independent reviewer of terrorism legislation, said that:

“The only sure way to prevent absconding is to lock people in a high security prison”.

I agree, and said so in the debate we had on the Urgent Question. Where an individual cannot be prosecuted or deported, whatever steps are taken and wherever they are located in the country, there will always be a risk of their absconding, just as there were under control orders. It has been suggested that a review of the TPIM system should be undertaken. I am satisfied that the TPIM regime is a robust and effective system for dealing with terror suspects who we cannot yet prosecute or deport, but we will review our procedures following this incident. I remind noble Lords that, as part of his role as the independent reviewer of terrorism legislation, David Anderson also conducts an annual report that covers TPIMs. I would expect him to examine this as part of his review.

We have spoken today, and there have been quite a lot of discussions, about budgets and resources and the pressures faced by the agencies. My noble friend Lord Lothian mentioned this in his introduction and many noble Lords have referred to it. It has been the policy of successive Governments not to reveal details of the individual agency budgets, and I do not intend to diverge from this particular practice. However, I am able to say that the Government welcome the ISC’s recognition of the vital role that, for example, Defence Intelligence plays within the Whitehall intelligence community. The reduction of the deficit is the Government’s top priority—all noble Lords will understand that—which means bearing down on public expenditure. The MoD, in common with the three agencies, will have to make economies to meet the demands placed on it by government, and no area of the MoD’s business can be exempt from those economies. However, I am confident that DI will continue to prioritise in those areas that matter most to UK national interests and defence. DI retains the ability to surge people into these areas, should the need arise, and work collaboratively with allies in areas of mutual interest where it is a national priority to do so.

The total security and intelligence agencies budget is approximately £2 billion per annum. It was and still is recognised that the spending review settlement will be challenging for the agencies. They will need to maximise value for money, efficiencies and collaborative working in order to live within this settlement. Agency heads are aware of the need to deliver efficiency savings while continuing to maintain capability; and there has been steady progress towards this over the past year.

The ISC has full access to the budgets of the agencies and I trust that it will continue to draw attention to any funding issues it feels warrant particular consideration. For example, the noble Baroness, Lady Taylor, and my noble friend Lady Hamwee talked about the recruitment and retention of personnel. That must be a matter to which the Government and the ISC should pay proper attention. I note the committee’s concerns about the achievement of sustainable efficiencies, particularly from collaborative working. The National Security Adviser will continue to monitor the agencies’ ability to meet these matters.

My noble friend Lady Hamwee raised concerns over the agencies’ ability to maintain effective staffing levels. In response to changes in the nature of the threat and the economic climate, the agencies have reviewed their staffing and skills requirements to ensure that they are in the best shape to meet future national security challenges. Each agency undertook a programme of redundancies or early release. These programmes, alongside recruitment in key areas, have enabled the agencies to grow the skills and expertise that they need to meet their future objectives and provide greater room for capacity growth within the organisations. The Government recognise that recruitment and retention of internet specialists at GCHQ is a matter of the greatest importance. We have therefore been working closely and urgently with GCHQ to identify a sustainable package of measures to improve its capacity to attract and retain staff with the necessary internet skills and to implement these measures by the end of the year. We will of course continue to monitor the situation and review these new measures.

I should make a point about diversity. Vetting is essential to the agencies to ensure the security of their work. Nationality requirements can pose real challenges in the case of some minority applicants and I hope that noble Lords will understand that. However, we are working with the agencies to improve diversity. A number of recruitment campaigns online and in the printed media have been specifically designed to attract those from diverse backgrounds.

My noble friend Lady Hamwee also raised the issue of attendance at JIC and NSC. These two bodies have regular attendees. However, with neither body does this prevent others attending when a subject under discussion is relevant.

I am sorry if I have spoken at some length but this has been a substantial debate on an important matter of public interest. I am grateful to all noble Lords who have taken part in a debate on a wide-ranging report. I warmly welcome the annual report and look forward to future annual reports being equally or—given the new arrangements in train for the ISC—perhaps even more insightful. Finally, I conclude by paying tribute once again to the enormous contribution made by the security and intelligence agencies in ensuring that the British public are properly protected. The men and women who work in our agencies are hugely skilled, professional and dedicated. The burdens that secrecy imposes on their private lives can be great and we owe them a great debt of gratitude.