All 1 Debates between Lord Collins of Highbury and Lord Northbrook

Mon 21st May 2018

Sanctions and Anti-Money Laundering Bill [HL]

Debate between Lord Collins of Highbury and Lord Northbrook
Lord Collins of Highbury Portrait Lord Collins of Highbury
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My Lords, I might as well begin by declaring what is not really a direct interest. My father was born in Bermuda and his father was born in Bermuda, so I think that entitles me to go and live there at some point and not have to deposit the $30 million that I think is currently needed if you want to live there. It is a very nice island, and I do love it and I love its people.

This debate is a reflection of constitutional concerns. There are concerns over the rights of people to determine their own laws and no one can disagree with that. But it is also a very strong moral debate, because we know that developing countries lose three times as much in tax avoidance as they get in all the international aid that is available to them. That is the scandal of this world we now live in. The Paradise papers and the Panama papers highlighted just how much of an issue this really is, and that is why we have such huge public concern. If we want to break the business model of stealing money and hiding it in places where it cannot be seen, transparency is the answer. I agree completely with the words of David Cameron in 2013 when he spoke about ripping aside “the cloak of secrecy” and repeated the well-known mantra that “sunlight is the best disinfectant”. I think that that commitment by David Cameron in 2013 is what this debate is about.

Last week, I had the opportunity of meeting the Prime Minister and Leader of the Opposition of the British Virgin Islands. They made their case very strongly to me about their concerns over this amendment. However, whatever position you are taking constitutionally, no matter what the concerns are, there is one thing that everyone agrees on, and that is that the scandal of money flowing out of countries and being hidden is something that has to stop. The Prime Minister of the British Virgin Islands acknowledges that transparency is important. We have heard about the actions of Bermuda and other places. David Cameron was actually trying to change the global position, to get to a position where we would have global agreement on addressing this issue.

How do we get global agreement? David Cameron believed it was by giving a lead. There is an issue here about reputation and being able to influence things. While we are in the European Union and saying, “You’ve got to ensure that all territories within the European Union comply with this”, and when we are in other global fora, we should be able to say that we will be acting on this. We know that the excuse of the overseas territories is often used by others to say, “If you’re not doing it there, why should we do it here?”. That is something that we have to address.

I absolutely understand the need to ensure that all the territories have the proper opportunity to consider this, but this is something that they have been acting on for some time. I respect the Minister’s undertaking to ensure that they have the necessary means as well as the necessary policy and advice.

Lord Northbrook Portrait Lord Northbrook
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When the noble Lord talks about the relevant means, does that mean he expects the UK Government to substitute the revenue that these overseas territories are going to lose? He may say that some dodgy money will go out there, but some reputable people with money out there will take their money elsewhere. Is he saying the UK Government will have to take their place with our duty of supporting these overseas territories?

Lord Collins of Highbury Portrait Lord Collins of Highbury
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I am grateful to the noble Lord for raising that point. We have been talking about money flowing out. We have had debates elsewhere. I have also spent time working in Gibraltar and I know that on financial matters—Bermuda is another good example—it has built its reputation on having proper transparency and controls. That is what we need to establish: that there is a good way of doing this that will help expand the industry. Reputational interests are incredibly important.

The noble and learned Lord, Lord Brown, is absolutely right that we do have time; the point was also addressed by the noble and learned Lord, Lord Mackay. We have had some considerable time already on this issue, but we have time to ensure that we can get everybody on board with this principle. The only way we will get global agreement is for the United Kingdom to go into those international fora and say, “No more—we need transparency”, because transparency is what will ensure that we can find all those activities, particularly tax avoidance.