Financial Fraud and Economic Crime

Valerie Vaz Excerpts

Wednesday 11th September 2024 Westminster Hall

[Mr Luke Charters (York Outer) (Lab)]

I beg to move,

That this House has considered the impact of financial fraud and economic crime.

It is an honour to serve with you in the Chair, Ms Vaz. I thank the House for allowing me to secure this debate. I also welcome the Minister to their place, and I thank the shadow Minister, the hon. Member for Hamble Valley (Paul Holmes), and the Liberal Democrat spokesperson, the hon. Member for Dorking and Horley (Chris Coghlan), for attending.

I must start by declaring an interest. In my previous role before entering this place, I was head of fraud and compliance for a fintech firm, responsible for screening billions of dollars of transactions a year. When it comes to dealing with financial criminals, unfortunately I have seen it all. From the use of artificial intelligence—

[Valerie Vaz (in the Chair)]

Order. Apparently, there is an acoustic problem for everybody sitting in the front row. Could the hon. Gentleman move to the back as the mics are not working?

[Jim Shannon (Strangford) (DUP)]

Always best to be a Back Bencher, Ms Vaz!

[Mr Charters]

May I continue, Ms Vaz?

[Valerie Vaz (in the Chair)]

I am really sorry, but Hansard may not have picked up the earlier part of your speech, so could I ask you to start again, please? Thank you very much. You are doing a grand job for your first attempt.

[Mr Charters]

With apologies to right hon. and hon. Members who will be hearing the same thing, I will start again.

It is an honour to serve with you in the Chair, Ms Vaz. I thank the House for allowing me to secure this debate. I also welcome the Minister, and I thank the shadow Minister, the hon. Member for Hamble Valley, and the Liberal Democrat spokesperson, the hon. Member for Dorking and Horley, for attending.

I start by declaring an interest. In my previous role before entering this place, I was head of fraud and compliance for a fintech firm, responsible for screening billions of dollars of transactions a year. When it comes to dealing with financial criminals, unfortunately I have seen it all. From the use of artificial intelligence avatars to bypass biometric screening, to sophisticated shell companies and complex layering, to spearfishing and parasitically targeting legitimate companies to advanced cloning techniques, I cannot overemphasise the danger that fraud and financial crime now pose or the complex layers that exist behind it.

Fraud places an emotional burden on victims. It ruins lives. We all know that as MPs from our surgeries. I will touch on a case that I heard about recently. The criminal aspect of fraud is not just about hobbyists in basements; we are increasingly talking about nation states who in some cases are working alongside advanced organised crime groups that are taking the mantle. They are often experienced professionals who work to circumvent the systems we use. Criminals are smart and frequently shift their modus operandi to get around our systems.

Although the responsibility to be smarter and take that proverbial step ahead falls to Government and firms, the situation is more complex than that. The risks are real, and if scams continue to increase exponentially we will have a dangerous environment for businesses. We will have more constituents telling more stories about how they have fallen victim to fraud, and the national cost could become so undesirable that we may well become the worst developed country globally per capita when it comes to fraud rates. If we do not act, there is a risk that fraud and economic crime could suffocate growth.

We currently suffer from relatively weak national co-ordination in tackling fraud and economic crime, which is made more complex by the fact that the perpetrator is often not in the same geographical location as the victim. This can cause local police forces to deprioritise fraud reports, but if we can fix that, we may be able to fix the foundations. Although the online fraud charter introduced by the last Government was a positive step, it is non-statutory and voluntary. Nothing in the charter addresses the issue of compensating consumers who have been defrauded by content originating online. There are no penalties for non-compliance, and that must be thought through, but we can turn the page.

While this Government are in their early stages, I believe it is time to smell the coffee and grasp the nettle —whichever analogy hon. Members prefer—so that we can become a world leader in anti-fraud and protecting consumers and businesses, and become a country where companies want to do business and will not be ripped off. The prize is that our fintech, regtech and financial services sector will want to become ever more internationally competitive if we truly get to the heart of fraud and economic crime.

Before I go any further on how we can make some fixes, I will quantify the challenges that we face. Fraud accounts for more than 40% of crime in the UK but receives only 1% of police resources. That statistic is chilling, but wait until we hear the cost of payments fraud to the UK economy: it is roughly £1.2 billion. There is also a cost to individuals. I have a constituent who attended an advice surgery just this weekend and told me that they had lost life savings, to the tune of a five-figure sum. Fraud often hurts the most vulnerable, either those on low incomes or those with lower tech proficiency, who are also more likely to fall victim.

However, more than three quarters of authorised push payment fraud originates online. Research from Innovate Finance on fintech illustrates the challenge posed by online purchase scams. It found that Facebook Marketplace represented a staggering 51% of all fraud cases for the firm in question. After I secured this debate, a main UK bank got in touch with me outlining similar statistics in which a huge part of the fraud that it encountered originated from Facebook Marketplace, so we must get better at stopping fraud at the source. There are some positives to consider: tackling payment fraud could contribute £6 billion to the UK’s GDP over five years, which would really strengthen our economy.

A smorgasbord of issues are causing our downfall, so I will outline seven positive steps to begin to tackle fraud and economic crime. They come from meetings that I have had with trade bodies, consumer groups, banks and payment providers and from many industry reports. We can become a world leader in anti-fraud and economic crime. Little investment is needed from the Government, but a new regulatory apparatus and new levels of co-ordination are needed. I stand as a firm friend to the Minister and the Government in making that change happen, so I will outline some positive suggestions for tackling fraud.

Recommendation 1 is that the new Government should set an anti-fraud target. In June 2023, the previous Government published their fraud strategy, saying that they would cut fraud by 10% on 2019 levels by December 2024. They achieved that, but the target was not ambitious enough and, importantly, excluded businesses, so the Government should commit to a fraud target that is genuinely ambitious and do so in collaboration with business. I do not want to pick an arbitrary number, because it is about focusing on action rather than aims, so one option is to set a target that we should have a lower fraud rate per capita than international peers—for example, an ambitious target that the per capita rate of fraud should be lower in the UK in five years’ time than that in France, Germany and other countries.

Recommendation 2 is for the creation of a new national anti-fraud centre. We need a strong new anti-fraud centre to face the complex interdisciplinary challenges that fraud poses. Action Fraud has skilled individuals, but regrettably it is no longer fit for purpose. That is my view, and often the view of industry. We need to reform it, and that means a review of its shortfalls, as well as the ways in which we can build on some of its successes in receiving reports. During my career, I came across a case in which a UK business was scammed out of more than £200,000. It submitted dozens of pages of detail to Action Fraud, and did not even get a call back from the police.

We should look to Australia and create a national anti-fraud centre to drive forward the Government’s fraud strategy with a clear vision and clear accountability. It could be part of the Serious Fraud Office or the National Crime Agency, or it could be its own entity, but it should be able to bring charges. The Australian Labour Government launched a cutting-edge national anti-scam centre in 2023. They rightly recognised the scale of the challenge, and took it on directly. The first action was to tackle investment scams, before disrupting criminal gangs who were advertising non-existent jobs. It is time to refresh the ecosystem that will fight fraud for decades to come, with a strong new national anti-fraud centre at the heart of Government. That would join up the SFO, the Financial Conduct Authority, Action Fraud, the NCA, the Met police, the National Fraud Intelligence Bureau and local police forces, and it would do that with a central leadership, because our institutions are currently too fragmented to properly deal with fraud.

Recommendation 3 is that this Government should replicate the previous Government’s appointment of an anti-fraud champion in Parliament. The appointment of an anti-fraud champion would ensure better co-ordination across Departments and could be a precursor to a new national anti-fraud centre.

Recommendation 4 is that we should support data sharing between sectors. We have to create a framework to enable data sharing between social media companies and payment participants. If information can be shared between the two, there is an opportunity to stop transactions at the source. Because of GDPR, there is no clear mechanism for data collaboration, but if we can find a way to create a precedent, that would provide regulatory certainty.

Recommendation 5 is to create a new framework that requires banks to share payment data. If we are to make progress, we need to find a way for banks to work collaboratively on payment data sharing. I regularly meet banks and industry leaders who are receptive to that recommendation.

[Mr Charters]

It is brilliant to have Members such as my hon. Friend, with his experience at Pay.UK, in this place, and I completely agree about the renewal of the payments architecture. If it had risk analysis and artificial intelligence monitoring at its heart, we could detect payments fraud at the very centre, which could save banks billions of pounds in compensation and be a better result for consumers.

Industry innovations such as “money mule insights” prove that the latest data analytics allow for much more sophisticated ways of targeting of criminals via data sharing between payment providers. Lloyds Bank got in touch with me this week to highlight that its mule-hunting team had identified a 44% increase in money mules over the past year. Data sharing between banks is critical in targeting money mules. At present, banks file suspicious activity reports, but they are often unable to share suspicious payment transaction data with each other. If they did, there would be an opportunity to harness suspicious payment data to detect and block fraudulent and criminal transactions in real time. I now believe that we have an unmatched opportunity to rebuild fraud and economic crime analysis with the renewal of faster payments and a new payments architecture. In conclusion on this recommendation, much greater payments data sharing is crucial if we want to stop fraudulent transactions from being processed.

Let me turn to recommendation 6, on the obligations on social media companies. The Government could introduce a shared responsibility and liability for social media and telecommunications firms to tackle fraud origination and incentivise them to invest to prevent fraud. A new anti-fraud centre could govern regulatory powers over social media companies and impose penalties or issue guidance to reduce fraud. That would tackle the things we heard about earlier, such as fraud originating from Facebook Marketplace.

I turn to my final recommendation: to expand the Financial Conduct Authority’s powers over the Post Office, which is the biggest cash provider in the country, through its everyday banking service, and has always played an integral role in providing access to cash for the nation. That should continue. As banks close their branches, the importance of the Post Office is growing. However, following the Horizon scandal, its reputation has been damaged. The Horizon system is still fundamentally being used today for the everyday banking service, which processes billions in cash deposits and withdrawals each and every month. To give banks and consumers confidence in the Post Office, the FCA should gain direct regulatory oversight of the everyday banking service. That is critical for resilience and managing financial crime risks. I can confirm that I am in the process of writing to the FCA’s CEO to encourage them to provide an update on their work on money laundering via the Post Office.

In conclusion, those are seven recommendations that I would like to implement. I think they would have a huge impact on our ability to better target fraud and economic crime. I will write to the Government outlining the recommendations, which are the culmination of meetings across industry, and I stand willing to work closely with them on implementing them, should they be interested in doing so. I look forward to hearing from colleagues across the House in the debate and to working constructively with Government and other hon. Members to tackle fraud. It is crucial we do that for financial credibility, for our constituents and for our country.

[Valerie Vaz (in the Chair)]

I thank the hon. Member for his assistance. I expect to take the first of the Opposition spokespersons at 5.08 pm. They will have five minutes each and the Minister will have 10 minutes. If hon. Members wish to speak, they should bob.

--- Later in debate ---

[Mrs Sureena Brackenridge (Wolverhampton North East) (Lab)]

I commend my hon. Friend the Member for York Outer (Mr Charters) for securing this important debate and for shining a light on an issue that has been neglected for far too long.

A growing concern facing my constituents in Wolverhampton North East is the rise of fraud, particularly scams perpetrated from overseas. We often hear calls for more arrests and prosecutions of the criminals, and I fully support that. However, we also need to acknowledge that a significant and increasing number of these fraudsters are not operating from within the UK. Instead they are part of international fraud rings based in hotspots such as India, the Philippines, South Africa, Brazil and parts of eastern Europe.

With advanced technology we have machines capable of making thousands of calls or sending thousands of texts per minute. The criminals can easily target people here in Britain. Our country unfortunately is a prime target for such activity. We do much of our shopping and banking online, and the widespread use of the English language makes it easier for fraudsters abroad to deceive and manipulate their victims here.

The real question is what we do about this. I suggest that when we negotiate trade deals with countries where such criminal activity is prominent, we push for stronger co-operation in fighting fraud. Let us make fraud prevention part of the agreements, giving the countries a real incentive to work with us to tackle the issue. Without such action, fraud will continue to grow, impacting more and more families in places like Wolverhampton North East. It is time we took strong, global, co-ordinated action to protect our residents from the scourge of international fraud.

[Valerie Vaz (in the Chair)]

I call the spokesperson for the Lib Dems, Chris Coghlan.

--- Later in debate ---

[Chris Coghlan]

I thank the hon. Gentleman for his intervention and I agree that there should be more emphasis on that area. I also thought that the hon. Member for York Outer made a really interesting point about the lack of FCA regulation of the Post Office, and I agree that that appears to be a gap in our existing regulatory framework.

We heard some really moving personal accounts about the cost of these online scams in the speech made by the hon. Member for Southend West and Leigh (David Burton-Sampson). We are also calling for the naming and shaming of the banks that have the worst records on preventing fraud and reimbursing victims. They should be held accountable. Financial institutions have a duty to protect their customers and we need to call them out when they do not.

The hon. Member for Strangford (Jim Shannon) talked about the power of social media scams, and we are also calling for a public awareness campaign. We need to empower everyone to spot, avoid and report fraud and scams. But let me be clear: the onus should not be on individuals to prevent fraud. Victims should never be blamed for falling prey to sophisticated scams. This issue is about building a society that protects citizens and not one that burdens them with responsibilities that should lie with institutions.

As we have heard, the numbers involved are staggering, both in terms of the billions of pounds that have been lost to fraud and the sheer volume of crime that is now online. Despite those facts, however, the previous Government’s response was lacklustre. I was moved by the hon. Member for York Outer’s point that 40% of crime is fraud, including online fraud, yet only 1% of police resources is dedicated to tackling fraud. The previous Government treated fraud with such little seriousness that they did not include it in crime statistics. Will the Minister commit to including fraud in crime statistics to demonstrate the new Government’s seriousness about this issue?

The Government must also recognise that economic crime poses a significant threat to our democracy. For too long, the previous Government allowed oligarchs to treat the UK as their personal playground, so that they could funnel dirty money into our economy and undermine our values. The Liberal Democrats are calling on the Government to begin seizing frozen Russian assets and to use the proceeds to support Ukraine; to close loopholes in economic crime legislation, which allow associates of authoritarian regimes, such as Putin’s cronies, to funnel corrupt funds into our country; and to properly resource the NCA to ensure that it has the tools to tackle complex financial crimes. We are also calling for an audit of UK-based assets owned by officials from countries with troubling human rights records, such as China and Iran, to ensure that we are not enabling regimes that abuse their own citizens.

As a former counter-terrorism officer, I know how important cross-border co-operation is. The hon. Member for Wolverhampton North East (Mrs Brackenridge) really brought out the importance of such co-operation when she made the point that the people conducting these scams are not necessarily all in the same geographical location.

I also know the damage that Brexit caused to our cross-border co-operation on serious and online crime. Will the Minister commit to improving co-operation with our European allies and with other countries more widely on financial fraud and economic crime?

I look forward to hearing the Minister’s response to the debate. It was a pleasure to serve with you in the Chair for this debate, Ms Vaz, and I again thank the hon. Member for York Outer for securing it.

[Valerie Vaz (in the Chair)]

I call the shadow Minister, who was appointed this morning, to speak.

--- Later in debate ---

[Mr Charters]

Thank you for chairing the debate, Ms Vaz. I am delighted that the House has been able to consider today’s motion. It is a matter of real importance and one that it is clear the Government will take seriously. I am grateful to the Minister for attending the debate, and to the shadow Minister and the Lib Dem Front Bencher for engaging, too. I am grateful to the Minister for considering my seven recommendations. The Members who have contributed are powerful advocates for their constituents. Many have experienced constituents coming to their surgeries and sharing harrowing stories of being scammed. I hope to work with some of the Members present on these issues over the months and years ahead.

I outlined in my maiden speech that under this Government there should be

“no safe harbour for fraudsters, no compromise in our pursuit of their schemes and”

—importantly—

“no escape from justice.”—[Official Report, 17 July 2024; Vol. 752, c. 124.]

More than that, I am encouraged by the Minister’s words and know that this Government take fraud seriously. By the end of this Parliament, I hope we can look back and see that we have made huge steps forward. We can become a world leader in tackling fraud once and for all.

[Valerie Vaz (in the Chair)]

I thank the audio technician for sorting the problem out earlier.

Question put and agreed to.

Resolved,

That this House has considered the impact of financial fraud and economic crime.

Rural Depopulation

Valerie Vaz Excerpts

Wednesday 11th September 2024 Westminster Hall

[Valerie Vaz (in the Chair)]

I call Torcuil Crichton to move the motion.

[Torcuil Crichton (Na h-Eileanan an Iar) (Lab)]

I beg to move,

That this House has considered depopulation in rural areas.

Tapadh leibh, Ms Vaz; thank you. It is an honour to have you in the Chair. I thank all colleagues for their attendance and support in what I am sure will be an illuminating 90-minute debate. Staging your first Westminster Hall debate is a bit like throwing a birthday party and wondering whether anyone will turn up—at least we know there is not a depopulation crisis in Westminster. I also thank the Minister for taking this debate. It may not seem obvious at first what the demographics of the Western Isles have to do with the Home Office, but if she bears with me, I will explain and expand on why this issue, which now affects the periphery of the UK, influences the entire economy and should inform the decisions that we make at national level on immigration.

First, let me give some context. In Na h-Eileanan an Iar, the Western Isles, we are in the middle of a depopulation crisis, and I am here to sound that alarm. We are painfully aware of what is a rapidly changing population. An older, strongly Gaelic-speaking demographic is passing on, and we see the rapid out-migration of younger, economically active families. They sometimes face insurmountable challenges: being priced out of housing and facing failing transport connections, stuttering health provision and childcare and a host of other issues, which weigh heavily in the scales of deciding whether to stay or go. And while we sound the warnings at home, the lights should be flashing on the dashboard in this place, too, and in offices across Whitehall. That is why I am staging this debate—to highlight the fact that we are simply running out of people to take up key public sector and private sector posts to keep our islands going. That affects the viability of vital services and it ill serves the local economy and the national one, too.

Just to give some further context, the estimated population of the Western Isles is 26,200. That represents a 5.5% decrease since the 2011 census and the highest percentage decrease in Scotland. According to estimates from the Western Isles health board, which has an obvious interest in this issue from a staffing and care point of view, the working-age population of the islands is set to decrease by 6% by 2028, while the over-75 population with the highest levels of comorbidity—people who have more than one illness—is set to rise by 25%. The situation is frightening. According to the board, these population changes will result in a year-on-year reduction in the available workforce—nurses and care staff—to attend the most important, most vulnerable people, and ultimately undermine the ability to sustain services.

I say we have to address this with local responses, Scottish responses and action at UK level to prevent the situation from entering that downward spiral. We know that an ageing-population pattern is part of a Europe-wide trend, and somehow we kid ourselves that this is an over-the-horizon event that we will deal with later, but for us in the islands, it is an urgent reality, and our breakfast will become everyone else’s lunch; if we do not address these issues on the edge of Europe, they will become structural problems for the rest of the country and the rest of the continent.

More than worrying about an ageing population, I worry about the exodus of a working population, particularly the female population. Since 2007, the number of women aged between 25 and 44 on the islands has dropped by 15%, from 3,289 down to 2,787. There are many reasons for that rapid decline but, for most parents, they can be encapsulated in one word—childcare. Of course that is a challenge for parents everywhere, but the lack of a working-age population, as well as the burdensome regulation, has strangled childcare in the islands. I am sure that is the experience of colleagues across the board. Working parents and primarily working mothers, of course, find it hard to return to work—to balance childcare and careers—and despite the many strong family connections and networks they have on the islands, ultimately they give up in frustration, and ultimately they speak to me, as they spoke to me during the election campaign, about giving up and moving to the mainland. And when we lose families, we lose the working-age population.

During the successful election campaign, I was joined by the then shadow Business Secretary, now the Secretary of State for Business and Trade, on a visit around some of the key ports in Stornoway. We went to a shellfish export company that was successful, with a £4 million turnover and rising, which was a great investment by the port and the parent company in the local fishing fleet. But the actual processing of the product in the chill of the packing room could not operate were it not for the Ukraine war. Most of the staff that packed the products were refugees from that conflict. They are a welcome and valuable addition to the workforce and the islands, but we cannot have our economic growth dependent on a conflict on the other side of Europe.

At a seafood processor on another island, a £3 million business at the end of a single-track road, there were sustainable stocks and work for perhaps 30 employees, but only 15 workers were available because there are simply no workers to be found locally. This was an operation that, pre-Brexit, had a large and well-integrated European workforce. Now it cannot find a local workforce, and the regulatory and bureaucratic challenge of sourcing staff is almost overwhelming.

In the fishing industry offshore, the present immigration requirements as I understand them require staff employed under the sponsored visa scheme to pass stage 4 English language tests. That is quite a high academic bar for an industry that seeks crewmen who are primarily experienced in working in noisy and challenging conditions where hand signals are often as useful as linguistic ones.

[Torcuil Crichton]

I agree entirely with the right hon. Member. The language requirement is just one aspect of the present visa system that is unsuitable for our fishing industry, the islands, and rural economies, and which we have until now been unable to navigate around. Hopefully it will undergo a fresh review under a new Home Office team.

The new Home Office team and immigration policy are rightly the reserve of the UK Government. I do not seek to break up control of the system. I stood on a platform of a properly managed, points-based immigration system that links up the needs of the workforce, the economy and the country. But I counter the narrative, which this summer was in danger of becoming the prevailing one, that the country is somehow “full up”. There are parts of the UK and Scotland where we are crying out for skilled workers to come and be part of our workforce, and to then stay and become part of our communities.

Scotland has specific needs for our skills base, and the islands and rural areas of Scotland and the UK have some very specific asks of their own. The lesson of policy in almost every area—not just immigration—be it administered from here or Holyrood, is that one size does not fit all. What works at a UK level may need more flexibility at a Scottish level, and again at a rural and island level.

In the past, the UK Government in other guises have worked with the Scottish Government to show flexibility. The former First Minister Jack McConnell, now Baron McConnell of Glenscorrodale, promoted the fresh talent initiative for post-study work visas for overseas students at Scottish universities, enabling them to stay on for a period. There is, and should be, interest in reviving that plan, and the idea of rural visa projects, which was advanced by the Scottish Government with the Migration Advisory Committee before the previous UK Government stamped on the idea.

There are many levers of Government that are not at the hand of the Minister, but that bear mentioning because they are part of local and Scottish solutions to rural depopulation. In the islands, we are lucky to have a system of crofting tenure, a uniquely Scottish system which has kept generations in their home community, but crofting has been hollowed out by political forces that neither understand nor value its work. Crofting tenure, properly regulated, should be a defence against the property market, but instead it has become an enabler. The sale of croft tenancies at inflated rates has become a critical factor in the housing shortage.

Crofting needs urgent reform. I commend the Shucksmith report, “The Future of Crofting”, now more than a decade old but an excellent piece of work, which sought to rebalance—or restore the balance—between crofters’ right to security of tenure and their responsibilities to keep the market at bay. It should be dusted down and re-enacted, but that is probably a subject for another debate and another place.

The lack of affordable housing, however, is an issue that many other Members here and elsewhere will recognise. I hope that it will be taken up by other speakers in the debate. In many of our areas, it is impossible for anyone with modest means to secure a house, which is a pretty basic precondition for retaining a working-age population and keeping the economy spinning.

We therefore need action on housing and on crofting regulation; we need access to land; and we need access and action on depopulation. As I said, the dashboard lights are flashing. More than anything we need focus. We need economic focus on the peripheries of the north and west of Scotland, those areas of continued depopulation. We need economic incentives, state aid, perhaps a reduction in VAT on construction, and enhanced capital allowances. I do not want the Minister to worry too much about those issues, because they are for the Treasury and other Departments, and I will take them up with them.

My time is running out, and I do not want to end on a note of despondency. There is hope. There is hope in community ownership of the many crofting estates in the Western Isles, a quiet revolution that has injected not just a new wave of development, but a growing sense of confidence and assurance that, given the tools, we can tackle the issues for ourselves. There is the vast opportunity of community ownership of, and a community share in, the wealth of wind in onshore and offshore developments, which are due offers. That change is so tantalisingly close and could be so transformative in terms of finance and confidence that it cannot be ignored as part of the UK Government’s GB Energy strategy.

There is also hope in individuals, families and communities and their resilience, which make the islands not just a great place to visit, but a precious place to stay. There are examples of local initiatives like the Uist repopulation zone, which has provided training opportunities and much-hallowed childcare provision to parents. It is led by Comhairle nan Eilean Siar and has received £60,000 from the Scottish Government. I commend the work of that project and of many other individuals and communities who focus themselves on the issue of depopulation at a local level.

As I said, we have a sense of urgency about this in the islands: we are experiencing a depopulation crisis. I hope now that that can find an echo not just in the contributions to this debate, but in the UK Government’s awareness and response to the issue.

[Valerie Vaz (in the Chair)]

I expect to call the Lib Dem opposition spokesperson at 3.28 pm.

--- Later in debate ---

[Several hon. Members rose—]

[Valerie Vaz (in the Chair)]

Order. We will start the wind-up speeches at 3.28 pm and we have three more speakers, so hon. Members can do the maths.

--- Later in debate ---

[Ben Lake (Ceredigion Preseli) (PC)]

Thank you, Ms Vaz, for the unexpected pleasure of contributing to this important debate; I congratulate the hon. Member for Na h-Eileanan an Iar (Torcuil Crichton) on bringing it to this Chamber. I thought I would offer a Welsh perspective, to ensure that all the nations of these islands are spoken about in this debate, although I fear that much of what we have heard rings true in Wales, too.

I represent Ceredigion Preseli. At the last census, Ceredigion—the majority of my constituency—recorded a 5.9% decrease in its overall population, and the communities in Preseli or Pembrokeshire that I now represent saw their population flatline. This is a problem that we are very much living with today. What does it mean? In practice, it means that we are having very difficult discussions about, for example, the provision of public services and whether the school estate is sustainable for the future. We are talking about the lack of GPs and the fact that we do not have an NHS dentist any more in much of the constituency. The hon. Member for Strangford (Jim Shannon) mentioned bank closures. I shall not name them now, but there are three well-known banks in the UK that no longer have a single branch in the two counties that I represent. This is the real consequence of depopulation.

I very much align myself with the comments made by all colleagues on what needs to happen to try to reverse this trend. However, I will add that a Labour predecessor of mine in what was then the constituency of Cardiganshire, the great—and sadly late—Baron Elystan-Morgan, talked in his maiden speech about how the outmigration of young people sapped the vitality of rural communities. He was speaking in the 1960s, but I fear that that is as true today as it was then. As well as sapping the vitality from private enterprise and having a detrimental impact on the provision of staff for key public services, this outmigration is also sapping and undermining the viability of our rural communities.

This is something that the UK Government can help with, and it should be on their radar. When the Cabinet Office looks at the range of risks it must monitor as part of its remit—something that the Public Accounts Committee discussed in the previous Parliament—it should look at how the discrepancies in demographic trends across these islands might have an impact on key public services, because in certain areas of rural Wales we will, I am afraid, see a collapse of public services. That will have a knock-on impact on more urban areas, which are themselves struggling with different demographic pressures.

This is an important debate, and I would ask the Home Office Minister to consider, as part of her important work in this new Parliament, the lessons to be drawn from experiences across the world. My hon. Friend the Member for Perth and Kinross-shire (Pete Wishart) mentioned the experience of Quebec. As west Walians, we often turn on the radio to hear adverts from the Government of Western Australia trying to attract many of our young doctors and nurses to migrate to that part of the world. Are there incentives we could use to persuade more of our young people to stay or to attract those from other parts of the world? There are many benefits to rural living, as all hon. Members have outlined today. Perhaps we could be more creative in grasping this problem by the scruff of the neck, because I fear we do not have much time left to deal with it.

[Valerie Vaz (in the Chair)]

I call the Liberal Democrat spokesman.

Knife Crime Awareness Week

Valerie Vaz Excerpts

Tuesday 21st May 2024 Westminster Hall

[Valerie Vaz (in the Chair)]

I would like to inform Members that the parliamentary digital communications team will be conducting secondary filming during today’s debate for its series of procedural explainers.

I will call Fleur Anderson to move the motion and then the Minister to respond. As is the convention for a 30-minute debate, there will not be an opportunity for the Member in charge to wind up.

[Fleur Anderson (Putney) (Lab)]

I beg to move,

That this House has considered Knife Crime Awareness Week.

It is an honour to serve under your chairship, Ms Vaz, for this important debate on Knife Crime Awareness Week, which is this week. It is important to raise the urgent need to tackle knife crime across the country. As a mum, it is a big concern for me every time my children walk around the streets. Every time we hear of a life lost so brutally—usually a young life—it breaks my heart.

--- Later in debate ---

[Fleur Anderson]

I thank the hon. Gentleman for raising that horrific-sounding incident. I agree that weapons in schools are extremely concerning and need to be tackled. We need a holistic approach; it cannot just be about weapons in one place or another, or education in one place or another, or about one particular service. We need to address the issue in the round, and weapons in schools are definitely a part of that.

Labour will extend the ban on zombie knives to ninja swords, establish an end-to-end review of online knife sales and close the loophole that allows online marketplaces to sell dangerous knives. Importantly, Labour will introduce a new young futures programme to establish new youth hubs, with both mental health workers and youth workers. The new young futures programme will draw on up to £100 million a year, based on combining existing commitments to fund youth hubs with mental health staff and youth workers in every community, and will be paid for by ending tax breaks for private schools. We will provide mentors in pupil referral units and youth workers in A&E, paid for by full cost recovery for gun licensing and a programme of public sector reform.

We will deliver a targeted programme in every area to identify the young people most at risk of being drawn into violent crime and build a package of support that responds to the challenges they are facing. That will be achieved by bringing together services at a local level to better co-ordinate the delivery of preventive interventions around the young person, rooted in a strong evidence base. We will develop a national network of young futures hubs and end the postcode lottery of youth services, which are better in some places than others. We will bring local services together and deliver support for teenagers at risk of being of drawn into crime or facing mental health challenges. Where appropriate, we will deliver universal youth provision, which has been cut so badly by the Conservative Government. We will also deliver youth workers in A&E units, custody centres and communities, as well as mentors in pupil referral units.

Under a Labour Government, there will be tough consequences for carrying a knife. A Labour Government will end the empty words and apology letters for knife possession, and will guarantee sanctions and serious interventions for young people who carry knives. There will be tough new laws to restrict the sale of knives. A Labour Government will implement a total crackdown on the availability of knives on Britain’s streets—no more loopholes, no more caveats and no more false promises. The Government have published 16 press releases about zombie knives since 2015, yet despite repeated promises to toughen the rules, a full ban is still not in place. Labour will urgently legislate to ban zombie-style knives, introduce tough criminal sanctions on tech executives who allow knife sales on their online marketplaces, and conduct a rapid review of online knife sales from the point of purchase through to delivery. In particular, we will strengthen ID checks and checks conducted by Royal Mail and Border Force for UK-bound parcels.

There are ways to take action. We can stop the increase in knife crime and see an end to this. I again thank the Ben Kinsella Trust, and recommend its report on keeping young people safe, in particular with regard to the need to work with young people in primary schools, which is where some of the belief systems about knife carrying start. I urge the Government to take more action to end knife crime.

[Valerie Vaz (in the Chair)]

I expect the debate to end at 4.47 pm, when I will move to the next debate.

Draft West Midlands Combined Authority (Transfer of Police and Crime Commissioner Functions) Order 2024

Valerie Vaz Excerpts

Monday 26th February 2024 General Committees

[Valerie Vaz (Walsall South) (Lab)]

Thank you, Sir Graham, for allowing a Member of Parliament from the west midlands to speak. Further to the point of order made by my hon. Friend the Member for Easington, could I ask the Minister what legal advice has been taken on whether the Government are acting ultra vires, if the court decides that the consultation process the Government have belatedly undertaken has not been followed correctly?

[Chris Philp]

The question of ultra vires relates to whether the Government have a statutory power to act in a particular situation. The Government quite clearly do have a statutory power to act by bringing forward this order. The judicial review concerns the nature of the consultation, which is a separate question. I can tell the right hon. Lady that the Government believe that the consultation was properly conducted, and we will vigorously and robustly defend the judicial review.

[Valerie Vaz]

The issue of whether the Government are acting lawfully is a very serious one. My question was whether the Government had taken legal advice on that point, given that judicial review proceedings are pending and the court will hear the whole case on 7 March. The Minister talks about consultation, but could he say whether the people of the west midlands actually wanted this process and what the results of the consultation were?

[Chris Philp]

I have already answered the right hon. Lady’s first question: the Government are very clear that there is a lawful basis on which to bring forward this order in statute. We will also robustly—and, I trust, successfully—defend the judicial review relating to the consultation, which is a separate question. On the outcome of the consultation, about 7,000 replies were received, which is of course a tiny fraction of the population of the west midlands. The responses were fairly evenly split: I think it was 50% against, 46% in favour and 4% undecided, so it was pretty even. However, as the right hon. Lady will know from her long experience in the House, the Government will take the consultation responses into account when they make their decisions. This is not a vote or a referendum, and it is not that the largest number of responses wins; the quality of the responses and the arguments advanced in them will be carefully considered before the Government—in this case, the Home Secretary—take their carefully considered decision.

--- Later in debate ---

[Chris Philp]

I will.

[Valerie Vaz]

On a point of order, Sir Graham. I understand that the hon. Member for Lichfield has a connection to the Mayor, and I wish that he could state what that is. Should he or should he not be taking part in the proceedings?

[Michael Fabricant]

Further to that point of order, Sir Graham. I am really grateful to the right hon. Lady for pointing that out. Legally, I am under no obligation, as I understand it—perhaps you can clarify this, Sir Graham —to declare an interest, because there is no pecuniary interest whatever. I am more than happy to say that Andy Street is a friend of mine, and I am sure he is a friend of many others. Indeed, I like to think I am a special friend of Andy Street’s, and I simply state that for the record.

--- Later in debate ---

[Chris Philp]

Indeed. The copy-and-paste responses were on the negative side. Of course, if one discounted those, the balance of replies would have been different, wouldn’t it? It is important to stress that we do not know who the Mayor will be after the election. The election will take place, and the people of the west midlands will decide who will be the Mayor, exercising mayoral functions and, if the order is successful, PCC functions as well.

That is important, because the West Midlands police force is one of only a small handful of police forces across England and Wales in so-called special measures—it is called “formally engage”, but in substance it is special measures. I would also add that West Midlands police force is, I think, the second worst-performing police force in the country when it comes to detecting and clearing up crime. It strikes me that there is a great opportunity to improve the performance of West Midlands police force under new management, whoever the Mayor may be following the election on 2 May.

Let me make some more progress.

[Valerie Vaz]

Will the Minister give way on the consultation, because it is important?

[Chris Philp]

Goodness me, I am being generous today —I will give way.

[Valerie Vaz]

The Minister really is, but this is important, and it is our job to question him—I thought that was what we were here for. The consultation took place over Christmas. Those are never good consultations, because people have other things to do. The Minister says there were just 7,000 responses, but I think that is quite a lot. Could he clarify what he means by “cut and paste”? If the question is, “Do you want this to happen?”, the answer is going to be only either yes or no. By “cut and paste” does he mean just a yes or a no? Lastly, there was a referendum on this very proposition in 2021 and the people of the west midlands decided against it.

[Michael Fabricant]

rose—

[Michael Fabricant]

I understand that the last time the consultation was done, they were strongly supportive of the Mayor. They thought it was a waste of money, actually.

[Valerie Vaz]

Are you the Minister? Are you answering the questions?

[Michael Fabricant]

No, I am intervening. The right hon. Lady keeps intervening, so I am sure she is not saying that I should not intervene, with the Minister’s permission. Am I not correct that, in fact, people were overwhelmingly supportive? Labour Mayor Sadiq Khan, Labour Mayor Andy Burnham and Labour Mayor Tracy Brabin all have control over the police, too. It saves money. It is not meant to be a job-creation scheme.

[Chris Philp]

My hon. Friend is quite right. Let me turn to some of those questions. The consultation period ran from 20 December to 31 January. It will not escape eagle-eyed Committee members that that encompasses the entire month of January, which by no stretch of the imagination can be described as “over Christmas”.

The right hon. Member for Walsall South referred to a referendum. I do not know if she was referring, perhaps, to the previous police and crime commissioner election—

[Valerie Vaz]

In 2021.

[Chris Philp]

I am glad that the right hon. Lady, from a sedentary position, has clarified that. So when she referred to a referendum in her intervention a moment or two ago, she was in fact referring to the previous police and crime commissioner election. That was, of course, appointing an individual to the position of police and crime commissioner. He may have had a number of things in his manifesto, but I do not think we can in any way construe that as a referendum. There was certainly no question on the ballot paper about transferring, or not transferring, PCC powers. I do not think describing a PCC election as a referendum on this matter is an accurate representation of what occurred.

Let me return to the substance of the issue. Part 1 of the Government’s review of the role of PCCs cemented the Government’s view that bringing public safety functions together under the leadership of a combined authority Mayor has the potential to offer wider levers and a more joined-up approach to preventing crime. Our levelling-up White Paper reinforced that.

My hon. Friend the Member for Lichfield pointed to a number of other large cities around the country where police and crime commissioner functions are already exercised by the Mayor—with varying degrees of competence, I would add—and there are good reasons for that. There are efficiencies. The Mayor tends to be a higher-profile figure than the police and crime commissioner. The Mayor can exercise systems-wide leadership over a variety of things that are relevant to fighting crime. Typically, they can offer more effective leadership than a PCC can in the urban area concerned. I am an MP in London. While Sadiq Khan does not do a very good job as Mayor of London in general, he does have a wide range of powers, and the position has the potential to provide wider leadership on issues of crime and public safety than someone acting as a police and crime commissioner alone. We believe that that applies here as much as it does in those other cities.

--- Later in debate ---

[Chris Philp]

For the record, I did not quite say that. I did not talk about disregarding all the negative responses; I referred specifically to the copy-and-paste ones. However, I would like to make it clear for the record—

[Valerie Vaz]

What is the difference?

[Chris Philp]

There were more negative responses than just the copy-and-paste ones. I would like to make it clear for the record that the Government carefully considered all the responses, regardless of whether they were copy-and-paste ones or not. It is very important that anyone reading the report of our proceedings understands that.

--- Later in debate ---

[Chris Philp]

Sir Graham, I will of course follow your advice, or perhaps your instruction, and reply to that another time. We have had a wide-ranging debate, and I thank the shadow Minister, the hon. Member for Oldham West and Royton, for the considered manner in which he made his remarks and for his commitment not to divide the Committee.

There was just one question I wanted to answer, which related to whether there is to be further consultation. There are no plans to consult any further. We have conducted the public consultation. The Government’s position on this question was categorically not predetermined. The Government did not have a fixed view of the matter during the consultation and took their decision quickly but only after carefully considering all the consultation responses.

[Valerie Vaz]

Will the Minister give way?

[Chris Philp]

I do not want to test colleagues’ patience.

[Valerie Vaz]

It is important.

[Chris Philp]

We have discussed it extensively already.

We very carefully considered all the responses, and only after considering them very carefully was a decision reached. In terms of local democratic consent, this transfer was possible only following a request by the Mayor of the West Midlands, who has by far the largest democratic mandate of any politician in the west midlands. On that basis, Sir Graham, I commend this order to the Committee.

Question put and agreed to.

Resolved,

That the Committee has considered the draft West Midlands Combined Authority (Transfer of Police and Crime Commissioner Functions) Order 2024.

Oral Answers to Questions

Valerie Vaz Excerpts

Monday 27th November 2023 Commons Chamber

[James Cleverly]

The Rwanda scheme is an extremely important part of our basket of responses. I will do everything to ensure that we drive down small-boat arrivals: that is the promise we have made to the British people, and that is the commitment I will deliver.

[Valerie Vaz (Walsall South) (Lab)]

One of the ways of dealing with illegal migration is to look at the number of cases. Can the Home Secretary say how many legacy backlog cases there are—if they have yet been triaged—and how many of those result from illegal migration?

[James Cleverly]

The historic backlog has been reduced by 65%. It has fallen by more than 59,000 cases since the end of November 2022. We have recruited 2,500 asylum decision makers, and we have increased tenfold the pace at which these decisions are made.

Draft Special Immigration Appeals Commission (Procedure) (Amendment) Rules 2023

Valerie Vaz Excerpts

Wednesday 1st March 2023 General Committees

[Robert Jenrick]

Happy St David’s Day to you, Sir Robert, and the other Members present.

I will answer some of the questions that hon. Members asked. I am grateful to the Opposition for their support for these important measures. The Government view British citizenship as a privilege that, in the most extreme circumstances, can be revoked where individuals have chosen to take a course of action that poses a grave threat to national security. The hon. Member for Aberavon can be assured that the Home Secretary—and, I suspect, her successors—will take that duty extremely seriously and apply it only in cases that command broad support. It is right that there is appropriate judicial oversight, and that is the purpose of this statutory instrument.

As the hon. Gentleman says, this measure will ensure that a highly experienced judge will hear the case prior to any steps being taken by the Home Secretary; that judge will decide whether it is obviously flawed, to prevent any cases that do not meet the evidential bar from proceeding. It is right that that should happen, because this is a very significant step.

We do not believe that further steps are required before we can move forward and begin the implementation and operationalisation of the process. The first applications will flow in time; I do not have a particular date because that is not the nature of this case load. If he looks back on recent years, the hon. Gentleman will see that the numbers are highly sporadic. They depend on events in international affairs. Particular conflicts have sparked more proposals to the Home Secretary, and there have been periods when there have been fewer applications.

Home Secretaries very rarely bring such matters forward themselves. Most cases come to the Home Secretary from the security services, which have specific intelligence about individuals and ask the Home Secretary to consider it and act as swiftly as possible. This Home Secretary, like others, will of course consider it in due course.

[Valerie Vaz (Walsall South) (Lab)]

Is the Minister confident that there are sufficient safeguards to ensure that the security services have the right person?

[Robert Jenrick]

I am confident. It is the duty of the Home Secretary of the day to read the evidence that is presented to him or her by the security services, consider it carefully, ask appropriate questions, probe that work, and then make a decision. The purpose of this instrument is to provide a further check to that important decision. It ensures that an experienced judge hears the evidence, either in public or in private. That is ultimately a decision for the judge, depending on the evidence presented. It may be a mixture of the two, given that some evidence clearly cannot be heard in open court. It will ultimately be for the Home Secretary to decide to proceed.

[Valerie Vaz]

Obviously, there is a turnaround time of 14 days. Is the Minister confident that there are sufficient judges? Are more going to be appointed?

[Robert Jenrick]

I have not heard any suggestion that there are insufficient judges. This type of case would be heard by the most experienced judges in SIAC, as the right hon. Lady would expect, given that these are some of the most complex cases that will ever come before them.

Oral Answers to Questions

Valerie Vaz Excerpts

Monday 6th February 2023 Commons Chamber

[Chris Philp]

Yes, I entirely agree. I thank my hon. Friend for drawing this issue to my attention a few weeks ago. We are looking to consult in the very near future to make sure that the law prohibits dangerous weapons where necessary.

[Valerie Vaz (Walsall South) (Lab)]

A man was stabbed to death outside Asda in Walsall town centre, and an 18-year-old was stabbed to death in Cook Street, Darlaston. What discussions has the Home Secretary had with the new chief constable about reducing serious violent crime in Walsall?

[Suella Braverman]

Violent crime is devastating, which is why we need to get knives and other offensive weapons off our streets. I am pleased with the targeted interventions made through violence reduction units, hotspot policing and, of course, increased police resources, which are all working towards a reduction in knife crime and violent crime.

Police Conduct and David Carrick

Valerie Vaz Excerpts

Tuesday 17th January 2023 Commons Chamber

[Suella Braverman]

It is important to note that David Carrick’s initial vetting to join the Metropolitan police took place in 2001, prior to the introduction of national standards on vetting, and prior to the regime that has been in place since 2017, which was introduced to ensure consistency in decision making. My hon. Friend rightly expresses frustration with the situation, and I agree. It is incredibly frustrating to be here yet again after another tragedy. But I would just gently push back. I have confidence in Sir Mark Rowley. He joined the leadership of the Met recently, and he has not hesitated in accepting the enormity of the problems that the Met police currently face. He has presented a plan and is already taking tangible action to deliver on it. He understands that there is a problem with confidence in the Met police, and challenges and problems with standards and performance. He is honest and frank about those challenges and does not shy away from fixing them.

[Valerie Vaz (Walsall South) (Lab)]

Who will be conducting the internal review, when will it report, and will the Home Secretary ensure that previous Metropolitan Police Commissioners will also give evidence to it?

[Suella Braverman]

The review will be carried out in a comprehensive and extensive way to command confidence among police officers, members of the public and other stakeholders. I want it to report swiftly. I am wary of having more reviews, reports and inquiries; we need action. My impression is that there is a real problem with the process. I need to identify exactly what needs fixing and thereafter we can take swift action.

Economic Crime and Corporate Transparency Bill

Valerie Vaz Excerpts

2nd reading
Thursday 13th October 2022 Commons Chamber

[Valerie Vaz (Walsall South) (Lab)]

It is a pleasure to follow the hon. Member for Thirsk and Malton (Kevin Hollinrake), and I will pay tribute to him later. It is hard to be here on a Thursday without thinking of the late David Amess and remembering how he always used to come into business questions with a smile on his face. It has been a year, but it does not feel like a year; it has gone so quickly. We remember both David and Jo Cox. It is a very sad time.

I welcome the Minister to his position. I know that he has a lot of work to do. He is a talented author, and I bet he wishes he was reading his books, rather than the Bill. This is a wide-ranging Bill, and the main reforms are to Companies House. I am quite surprised that two Departments are covering this. It is a huge Bill, with six parts, 162 clauses and eight schedules. It is impossible to go through the whole Bill, but I have looked at certain sections of it, and it makes big reforms. I hope that this will all be teased out in Committee, and I want to highlight a few areas. I welcome what my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper) said: we welcome the Bill, but with reservations.

Reading the words “Companies House” took me back to when I started working as an articled clerk. I had to go down to Companies House, which was on Old Street then, and look through the microfiches of all the companies; that was the work we did at that time. Having qualified as a lawyer and worked in the Treasury Solicitor’s Department, I saw civil servants when they had the tools and the resources to go after companies, and they did that in the public interest—they understood those words, which they picked up over the years by osmosis and the way that departments worked, and they used to wind up companies in the public interest. The hon. Member for Thirsk and Malton mentioned going after directors and having that strict liability. There is the Company Directors Disqualification Act 1986, but I do not think it is used often, and certainly not to wind up companies in the public interest. I hope the Department will look at that, but that requires resources, and by the time I had left the Treasury Solicitor’s Department, it had been outsourced to other companies.

I am not sure that there is a reference to this in the Bill, but it is possible to buy companies off the shelf and then transfer them to new ownership. What drew me to this issue, as well as my previous experience, is that a couple of constituents contacted me to say that their home address was being used as the registered address of a company, which they were getting mail for, and they could do nothing about it. They got in touch with Companies House. At the time, the Minister wrote a letter to say that there would be a new Bill and reforms, but these people were having to correct the information themselves and provide evidence that they lived at that address—they were the victims, but they had to rectify the register. I hope the Minister will confirm that these new powers will cover that situation, so that the onus will not fall on the victims to rectify the register, and that the registrar will deal with this under the ID verification scheme. There are some concerns about that new scheme. The regulations are still to be made, and it is not clear on the face of the Bill what the process will be and what will count as acceptable evidence; there is concern that it will just be biometrics.

The second case I want to come to is one that I have had three emails and lots of information about, and it is that of a constituent who I will refer to as Mr B—not because that is an expletive deleted or what I feel about him, but because that is his initial. He was going round setting up companies to defraud elderly people, and he was using false addresses. Even now, there are 16 companies registered to Mr B, of which five are active, and they are renewable energy companies. He is not only doing it here; apparently, he has a database of companies around the world—he has victims in India, the USA and Canada. My constituent went to the police and was told to go to Action Fraud, which told her to go to the National Fraud Intelligence Bureau, and nothing has been done. Will the Minister meet me to discuss that case? Can he confirm whether the new verification scheme will stop that?

The dynamic duo, my right hon. Friend the Member for Barking (Dame Margaret Hodge) and the hon. Member for Thirsk and Malton—what would we do without them?—both mentioned that funding is an issue. We may give Companies House powers, but it must have the tools to finish the job. It is more than just snagging. It only costs £12 to set up a company. In France it is £50, and in Germany it is £100. The APPGs chaired by this dynamic duo who are keeping us safe have both suggested a cost of £50, but as the hon. Member for Glasgow Central (Alison Thewliss) said, the Treasury Committee has suggested that it should be in the region of £100. At today’s rate, someone could set up eight companies—why would they want to?—for £100. If it would help with the costs of verification, the Government should look at the higher figure of £100, because the Treasury Committee has taken evidence on that. We know that over half a million companies are created each year. Transparency International UK found that, as the hon. Member for Strangford (Jim Shannon) mentioned, between 2000 and 2019 nearly £137 billion was lost in money laundering and corruption.

That leads me to my next concern, which is the method of identity verification. There seem to be two routes mentioned in the Bill—Companies House or an authorised corporate service provider. Again, there is nothing in the Bill about how this will be set up. I know there will be secondary legislation, but I think the House would like to see some of the processes and what exactly that will entail because I have a few questions. What are the transactional costs of using an authorised provider as compared with Companies House? Are we just outsourcing this process and will such providers be accountable to the registrar at Companies House? How many authorised corporate service providers will there be, because this Bill is quite rightly about corporate transparency?

This brings me to the register of overseas entities, which is operational, and as of 11 October 1,605 have registered. I logged on to the register, and the House of Commons Library helpfully took me through the process. I searched through the register and, lo and behold, companies with opaque beneficial owners can still register. I will mention just one: Merakino Ltd, which is registered in Jersey. When I clicked on the beneficial tab, it came up with East Fiduciary AG, with the registered office in Switzerland, and the only person named is the agent in the UK supervised by His Majesty’s Revenue and Customs. A company expert has said that about 20% of registrations on that register have a beneficial owner that is a legal entity, not a human being, which shows, sadly, that the register is not working. I hope the Minister will look at this, and say whether he considers that a register in which for 20% of the entries the entity is a company is working.

I, too, agree with other colleagues who have said that this is a missed opportunity, because I feel that the Government have failed to close a huge gap that in effect amounts to economic crime against the British people. I know there will be mumbles about this not being the right vehicle and so on, but I think closure of the non-dom status is a vital area in fraud and in ensuring that money owed to the British people stays here. Those who choose to live, use our services and vote here do not pay their taxes on overseas income, and as my hon. Friend the shadow Chancellor has pointed out, this would raise £3.2 billion a year.

Sadly, in conclusion, I have several questions for the Minister. Will he consider raising the registration fee, as suggested by the Treasury Committee and the APPGs, in line with other countries? Will he look at that, and at an open and robust process for identity verification? Will he look again at closing the loopholes in the overseas register? Will our constituents be safeguarded from the use of their own home addresses? Will Mr B, using fake companies to defraud constituents, be exposed, caught and penalised? Looking through clause 96, one of my concerns is that the registrar can apply civil penalties, but using a civil burden of proof—the burden of proof is “beyond reasonable doubt”, but the penalties are civil ones—so does the Minister, the Department or the Government know how many people will be caught by this, because it is quite a high bar? Our constituents are working hard and they pay their taxes, mostly through pay-as-you-earn, and it is right that we close loopholes and protect them against fraud so that we can continue with the entrepreneurial spirit this country is very good at.

Remote Observation and Recording (Courts and Tribunals) Regulations 2022

Valerie Vaz Excerpts

Tuesday 19th July 2022 General Committees

[Miss Dines]

Those who apply for remote access would need to apply before the hearing in the normal way to ask for permission and a link would be sent. It is certainly very distinct from broadcasting.

[Valerie Vaz (Walsall South) (Lab)]

If I heard the Minister correctly, she said “name and address”, but the regulations state “name and email address”. I would say that it is important for someone to give their address. Who will do due diligence on who applies? I know that the admin staff at the court—if there are any left—are overworked, so will there be any due diligence on the email addresses, which could be out of the jurisdiction?

[Miss Dines]

In the usual way, there is a prior application. Each application is considered properly by the court and the judiciary. It is not the case that there will be a blanket allowing of everyone who applies to have that observation. However, the right hon. Lady is right: it is “name and email address”, and there will be sufficient time for proper research to look into that. I am sure that, as time goes on, due diligence will be put in place. Extra funding has been made available to facilitate that, and it is open to the judge, as in the normal situation, to refuse any application if there is uncertainty.

--- Later in debate ---

[Miss Dines]

It is little different from what would happen under the old system, where people present themselves at court and try to get in the public gallery. There might be a limit of 20, 30 or 50 people, depending on the size of the court. There needs to be a prior application so that the court system would not be surprised by it, and there would be sufficient time. Funds are being set aside to implement it. If there is an unusual administrative burden, it is open to the court, as it always has been, to refuse an application or physical entry. It is exactly the same principle, and there will be time for that to be considered. I am grateful for the intervention, but I will move on.

Importantly, the regulations ensure that the powers to admit remote observers may be used in jurisdictions that were previously not within the scope of the Coronavirus Act, such as the Court of Protection, coroner’s proceedings, and all tribunals outside the unified system, such as employment tribunals. Making the legislation permanent and expanding it in two important ways will strengthen open justice and the transparency and accessibility of our justice system. It supports the recommendations of the Cairncross review on the future of journalism, and report by the Digital, Culture, Media and Sport Committee in November 2020 on the same topic, by offering modern digital solutions to facilitate journalists’ access to court. It will improve court access for members of the public who are perhaps less physically able to attend court hearings and buildings to observe the proceedings, as well as those who might feel intimidated or uncomfortable in a physical public gallery.

Public galleries will continue to be available in our courtrooms, as they are now. The enabling provisions, new sections 85A and 85B of the Courts Act 2003, inserted by the Police, Crime, Sentencing and Courts Act, contain the necessary safeguards to ensure that remote observers and participants in a hearing cannot make an unauthorised recording or transmission of the proceedings. Transgressors would be subject on conviction to a £1,000 fine or, if found in contempt of court, they would face up to two years in prison. Those safeguards replicate in a digital sense existing prohibitions that have long applied to traditional courtrooms.

It is important to note that the provisions retain at their heart the principle of judicial discretion. It will be for judges, magistrates, coroners and tribunal panel members to decide on a case-by-case basis whether to provide transmissions of proceedings to members of the public.

[Valerie Vaz]

I thank the Minister for giving way. We understand that this is her first outing and we wish her well. It is right to explain what judges need to take into account, as set out in regulation 4. Given the policy behind the regulation, will there be a practice direction, and will she encourage the Lord Chancellor to issue a practice direction so that there is consistency across all the courts and tribunals?

[Miss Dines]

The Lord Chief Justice and Senior President of Tribunals have issued joint guidance already on how the remote observation should be facilitated across our courts and tribunals. The President of the Queen’s Bench Division has issued specific guidance in relation to criminal proceedings. The Chief Coroner has issued guidance for coroners courts, which are very different, of course. Her Majesty’s Courts and Tribunals Service has issued guidance to all its staff on how to implement the regulations, and its gov.uk pages have been updated so that the general public and media may better understand the regulations.

The policy of allowing remote observers at court and tribunal hearings is often confused with the use of remote hearings more generally. To be clear, how a hearing is to be heard—in-person, remote or hybrid—is a matter for the judge, magistrate, coroner or tribunal panel to decide on a case-by-case basis. They are best placed to decide in each case how a hearing is to be heard, whether it should be in public or private, and whether remote observation is permissible.

I should also make it clear that the legislation does not allow indiscriminate broadcasting. It will only allow the transmission of proceedings to made either to individuals who have identified themselves to the court or to designated live-streaming premises. The regulations prescribe that, when deciding to allow remote observation, the court must be satisfied that that is in the interests of justice, and that doing so does not create an unreasonable administrative burden on judges and court staff. For example, judges will be under no obligation to allow transmissions to be made to remote observers during a traditional in-party hearing where a public gallery is available if the necessary technology or staff are not readily obtainable.

Finally, I said I would outline why it is appropriate to use the affirmative procedure for this instrument. I fully understand that the procedure should be used only with good reason, and the Government considered it to be appropriate so that the temporary and emergency coronavirus legislation which the regulations replace could be removed from the statute book as soon as possible. The slow progress of the Police, Crime Sentencing and Courts Act through Parliament necessitated the extension of those temporary powers beyond their original term.

It was also vital to enable this new remote observation framework expeditiously to resolve some known issues within the emergency Coronavirus Act powers. That will ensure that several important jurisdictions that were neglected in the previous legislation—notably the Court of Protection, coroners courts, and tribunals outside the unified structure, including employment tribunals—are now explicitly legislated for. Those jurisdictions may now allow remote observation proceedings safely and efficiently and within the appropriate safeguards in the new legislation.

As of June 2022, around 7,000 hearings a week rely on audio and video technology. The use of such technologies is an important component of our court recovery efforts, and remote observation helps to ensure that open justice is maintained.

--- Later in debate ---

[Valerie Vaz]

The Minister is being generous with her time. She mentions the interests of justice and transparency, so I wonder whether she has considered the publication of the names of remote observers at the time a direction is made. How will Parliament know how many people have applied for remote observer status? For example, who are these legal bloggers who are entitled to be part of youth court proceedings? Could she name one of them?

[Miss Dines]

The Department will consider the publication of names in due course. From my own experience, I can say that it is not usual, and the regulations bring in a way of observing digitally, continuing the system as it has evolved.

In relation to youth courts, there has always been and will continue to be applications in the public interest for various observers to observe. They may be relatively small in number—I do not have the numbers to hand—but it is not perceived to be in any way an opening up or broadcasting of any proceedings that are inappropriate. We must not forget that the discretion remains with the trial judge or head of tribunal who is intimately experienced with that particular matter.

These remote observation regulations ensure that all our courts and tribunals can rely on audio and video technology to hear cases wherever it is determined to be in the interests of justice to do so. Given the considerations I have mentioned, the Government consider the use of affirmative procedures appropriate. In this instance, it has ensured that our courts and tribunals have an expanded, permanent and reliable legislative framework that more closely fits its needs during a critical time as we work hard to deliver justice and recover from the negative impacts of the pandemic. This instrument will therefore support and strengthen the principle of open justice and increase the accessibility and transparency of our justice system as the Government seek to modernise it.