Criminal Finances Bill

Debate between Richard Arkless and Joanna Cherry

Wednesday 26th April 2017 Commons Chamber

[Joanna Cherry (Edinburgh South West) (SNP)]

I congratulate my hon. Friends the Members for Dumfries and Galloway (Richard Arkless) and for Kirkcaldy and Cowdenbeath (Roger Mullin) on contributing to putting some real teeth into this Bill. Does my hon. Friend the Member for Dumfries and Galloway agree that the Government’s compromise amendment 34 on sharing beneficial ownership information is not really a compromise at all, and instead just a restatement of existing Government policy, with no mention of transparency or of developing countries? Does he also agree that this is a lost opportunity, in light of the Panama papers, to grasp the issue of corruption and work a bit harder to ensure real transparency in the OTs, so that we can stop the sucking away of money from developing countries?

[Richard Arkless]

I agree with my hon. and learned Friend, but the jurisdictional issue still comes into play. Although of course I agree completely with the thrust of her substantive argument that it would be sensible to compel the OTs to publish these registers, unless I can satisfy myself that this place has locus to do so, I would find it very difficult to support that suggestion. My view is that we will never fully rid the financial sector of financial criminality until we have a uniform publication of registers of beneficial ownership, and we must strive to achieve that.

Despite the cross-party co-operation, I was somewhat perturbed by the Labour Front-Bench Member saying that its position is clear on this matter. I do not agree; it has not been clear. In particular, an amendment was put before the House when the Bill was previously before it that would have compelled the Crown dependencies to publish their registers, but with nothing against the OTs. That should have been the other way around. Therefore, we could not support that amendment, but we would have been willing to support an amendment in relation to the OTs. That might well have been a missed opportunity.

Throughout the passage of this Bill we have sought to co-operate, and, more importantly, we have sought to widen the debate beyond the technicalities and the manifestations of financial criminality contained in the Bill. We think that the banking culture in the UK is a significant facilitator and indeed the root cause of financial criminality, and that we will never have the tools to eradicate it fully until we tackle that root cause. I do not think that that is a particularly controversial point. I can understand why the Minister was keen not to include the provision for a banking culture review in the Bill, although we would have done so, but I urge the Conservative Front-Bench team—or whoever is in government after the next election—to pursue this point. The banking culture that has developed over the last generation is the real facilitator of financial criminality and it must be reviewed and brought to task.

We have sought to widen the debate in relation to whistleblowing. Whistleblowers need genuine, material and proper protection. It is not easy for people working in large financial services organisations who see things to report to their boss that things are not as they ought to be. People who find themselves in that position should have the maximum protection from this place, to feel able to bring that information forward so that the regulators, the Government and all of us can react accordingly. That will be crucial in the future.

Therefore, while we accept and agree with what is in the Bill, I do not want the conversation to stop here. It should continue beyond this Bill, to examining how we can tighten things up further and deal with some of the underlying root causes of financial criminality, not just the manifestations and the vehicles to tackle it.

I conclude by saying that I am delighted that I will be fighting the general election in Dumfries and Galloway for the SNP. We will be giving it everything we have got, and hopefully sending this Prime Minister homewards to think again.

Lords amendment 1 agreed to.

Lords amendments 2 to 147 agreed to, with Commons financial privilege waived in respect of Lords amendments 11 and 33.

Criminal Finances Bill

Debate between Richard Arkless and Joanna Cherry

2nd reading: House of Commons & Money resolution: House of Commons & Programme motion: House of Commons
Tuesday 25th October 2016 Commons Chamber

[Richard Arkless]

I agree with the Minister, but my point is that under the Bill, corporate economic crime extends only to tax evasion and not beyond it. Within the four corners of the Bill, there is relatively little to disagree with, but it does not go beyond tax evasion, which I think is a huge omission.

SNP Members can support other parts of the Bill without much hesitation—for example, the expansion of the suspicious activity reports regime, information sharing disclosure orders and combating terrorism. We support all those measures in principle. Notwithstanding our in principle support, we do not think it goes far enough, as I have said.

I shall shortly go through some of the issues that we think are missing from the Bill. Before I do so, however, I wish to make a small point about the time we have had to consider this Bill and its contents. We do not agree that the Scottish Government were given adequate time to scrutinise them. The Bill has been instructed and drafted with high speed, admirable though that may be, but with limited consultation. Only in the last fortnight were we shown draft clauses that related to unexplained wealth orders and mobile items of value—and even then, they were tagged “in confidence”. That said, we welcome the move to extend to Scotland the powers for wealth orders and disclosure orders, as requested by the Scottish Government.

For these reasons, the Scottish Government have not had the chance—and neither have I—to consider the Bill in sufficient detail, to consult Scottish stakeholders properly or to provide the Minister and the Government with some detailed advice. The Scottish Government will do so in due course. In addition, we are already aware of concerns among some Scottish stakeholders, particularly the civil recovery unit, that their advice has not been fully listened to and acted upon by the Home Office, and that the current approach adopted in the draft seizure and forfeiture powers provisions may not be the most effective available. I would encourage the Minister to continue his dialogue with the Scottish Government. He demonstrated yesterday evening that that is ongoing, for which I thank him.

So what is missing? It remains the case for us that the most notable aspect of the Bill is what is not in it. The headline objective of the Tory manifesto in this context was to deal with tax evasion, but, as has already been pointed out, the Bill makes absolutely no mention of the United Kingdom overseas territories and Crown dependencies. Given the aforementioned statement of intent in the Tory manifesto and the problems highlighted by the Panama papers—and the public reaction to the Panama papers—that omission seems very odd and very peculiar indeed.

[Joanna Cherry (Edinburgh South West) (SNP)]

The OECD estimates that tax havens may be costing developing countries a sum up to three times the size of the global aid budget. Does my hon. Friend agree with me, and with the charity Christian Aid, that the most effective way in which the Government could tackle corruption and counter the financing of terrorism would be to set a deadline by which the overseas territories and Crown dependencies would have to adopt the same level of transparency as the rest of the UK, and does he agree that the Bill constitutes a missed opportunity for them to do so?

[Richard Arkless]

Unsurprisingly, I agree wholeheartedly with my hon. and learned Friend. I should like the Minister to consider whether there is any way in which we could compel the overseas territories and Crown dependencies to publish registers of beneficial ownership, which would provide much needed transparency in what is turning out to be a bottleneck in the fight against tax evasion.

[Joanna Cherry]

Does my hon. Friend agree that there is a precedent? The Government have repeatedly legislated in respect of overseas territories—for example, on issues relating to corruption, abolishing the death penalty, pirate radio, and the decriminalisation of homosexuality.

[Richard Arkless]

Again unsurprisingly, I agree with my hon. and learned Friend. Where there is a political will, there will be a way. If the Government were inclined to legislate in relation to the overseas territories and Crown dependencies, I have no doubt that that could be done, but the omission indicates to me that there was not the necessary political will.

We do not believe that the Bill will tackle tax avoidance appropriately. Avoidance has increased under the Conservative Government. Last year the UK tax gap was a staggering £36 billion, and, despite the positive rhetoric emanating from the Tory Front Bench, it has increased by £2 billion on last year. More needs to be done in the Bill to achieve everyone’s stated aims.

Why does the Bill not address the tax code? The UK has one of the most complex tax codes in the world, which has clearly led to opportunities both to create new loopholes and to exploit existing ones. We therefore call on the Treasury to convene a commission, and to report back within two years following a comprehensive consultation on the simplification of the tax code. By opening the door to a simplified tax system, the Government could boost tax yield, encourage compliance, and avoid exploitative loopholes such as the Mayfair loophole and employee benefit trusts.

Changes are one thing, but they could become meaningless if we do not allocate the resources that are necessary to ensure that the Bill and subsequent measures have real effects. We think that the Government’s decision to close 137 HMRC offices will be completely counterproductive in relation to the laudable aims of the Bill. Those resources are needed to boost compliance, not to mention the human cost that has been incurred by families, employees, communities and local businesses.

Let me make one final point to the Minister, which will be expanded later by my hon. Friend the Member for Kirkcaldy and Cowdenbeath, and which we discussed yesterday evening. My request is for the wholly reserved issue of Scottish limited partnerships to be dealt with in the Bill, which it is not at present.

It is the view of the Scottish Government that a legislative consent motion will be required to give effect to the provisions covering seizure and forfeiture powers and unexplained wealth orders, and some of the minor and technical changes in the Proceeds of Crime Act 2002. The motion will also include the specific provisions on civil recovery and criminal confiscation that the Scottish Government require to be included in the Bill.

We will not trigger a Division this evening, but we want to reiterate very firmly that the Bill does not go nearly far enough in dealing with what I think is a real and tangible outcry from the public, given what has happened over the last five, six or seven years. If we are serious about creating and maintaining confidence in the banking system—which has completely evaporated—we need to tackle this issue head on, and do more than we are doing in the Bill.

Human Rights Framework: Scotland

Debate between Richard Arkless and Joanna Cherry

Wednesday 2nd March 2016 Westminster Hall

[Richard Arkless]

The Minister says that the issues have been dealt with before. The question is simple: do the Government believe that human rights are reserved or devolved? He says that they have given the answer before. Where and when? We have never heard it.

[Joanna Cherry]

Tell us.

[Richard Arkless]

Tell us!

Refugee Crisis in Europe

Debate between Richard Arkless and Joanna Cherry

Tuesday 8th September 2015 Commons Chamber

[Richard Arkless (Dumfries and Galloway) (SNP)]

Does my hon. and learned Friend agree that the crystallisation of the embarrassment we on the SNP Benches feel about the UK Government approach is in the numbers? When the 20,000 over five years is stripped down, it is six per constituency per year across the United Kingdom. I have had hundreds of emails and crying phone calls from my constituents who are ready to take vastly more than this pitiful number of six per constituency. Does my hon. and learned Friend agree that it is the numbers that are embarrassing?

[Joanna Cherry]

I agree with my hon. Friend, and all Members in this House will probably have shared that experience of being absolutely inundated with emails and letters over the last few days.

I was talking about German generosity in the face of this humanitarian crisis, and I pose this question: on what basis do the UK Government think it is fair for Germany and our other EU neighbours to accept so many of these refugees who have arrived in Europe when the UK turns its back completely on the refugees who have arrived in Europe? There is a depressingly large contrast between Angela Merkel’s announcement yesterday of a €6 billion investment in shelters and language courses for refugees and the UK Government’s rather frosty approach.

There is also a danger that the UK Government policy of only taking those refugees who have stayed behind in the camps will label them as “good” refugees and those who have come to Europe as “bad” refugees. Such an approach is not helpful and does not begin to engage with the reality of the situation.