Terrorist Asset-Freezing etc. Bill [HL]

Lord Davies of Stamford Excerpts

Tuesday 27th July 2010 Lords Chamber

[Lord Davies of Stamford]

My Lords, I echo the congratulations that my noble friend Lady Hughes has already received on her first-class maiden speech. The trouble is that, in making my own maiden speech just two speeches later, it is a difficult act to follow. It is also an unexpected honour to follow a distinguished former Lord Chancellor, who made a characteristically authoritative and expertly practical speech about the Bill.

I hope that I am allowed to start by expressing a deep sense of gratitude to the electors of Grantham and Stamford, who sent me to the House of Commons—in the case of the electors of Grantham for the past 13 years and of Stamford and Bourne for the past 23 years. No honour is greater in public life than that of being selected by one’s fellow citizens to represent them in Parliament. I also thank profoundly my wife for her absolutely indispensible and splendid support for those 23 years, sometimes very dramatic, on the Back and Front Benches and in government. I thank the rest of my family as well. As my noble friend Lady Hughes said—and it is true in my case, too—although both my parents are no longer here, I owe them everything.

I thank extremely warmly and very specially my two supporters, my noble friends Lord Temple-Morris and Lord Radice. I do not believe that any new Member joining this House could have had kinder, more stalwart, more conscientious supporters than those. I have been quite overwhelmed, as many of us have in arriving here, by the extraordinarily warm welcome that we have received from everybody, from the Lord Speaker, the Leader of the House, the Leader of the Opposition and noble Lords on both sides of the House, despite the fact that we have arrived in such large numbers in the past few weeks. I am already very grateful for countless small pieces of good advice and help from Clerks, other officials, messengers, waiters, librarians and all those who do such a good job in this place to make our life here more agreeable—and, I do not doubt, to make our activities here more effective than they would otherwise be.

I know that it is a convention of a maiden speech not to be controversial. Although in the course of my political career I have not always been able to avoid controversy or confrontation—indeed, there were moments in life when it would have seemed “abdicatory” or unworthy to have done that—nevertheless, I certainly wish to follow that convention today. I shall make one or two remarks about the Bill in general terms, but I do not think that any of them will be particularly provocative. I shall also make a proposal or suggestion about which I can say in advance with considerable confidence that it is not a matter of public controversy at present because it is not an issue that has been raised in public debate. However, I think that it is an issue that should be raised in public debate, and this Second Reading presents such an ideal opportunity that I think I ought to raise it. I hope that when I do so, if any noble Lord or noble Baroness feels that he or she disagrees with what I say, the disagreement will not be so violent as to make him or her feel frustrated at not being able to jump up immediately to take issue with me.

This is a very important Bill that deserves very careful scrutiny. That goes without saying. It goes to the heart of the liberties of the subject. The idea of a Treasury official by executive order simply paralysing the property of any citizen is a horrific one and in normal circumstances would be intolerable and inconceivable in a free society. Nevertheless, democracy is entitled to defend itself against existential threats, and the situation at present in relation to terrorism is anything but normal. So we have to look at this from the point of view of getting the right balance. That has been the principle governing all the contributions that I have heard on the subject this afternoon.

Clause 22 provides a very necessary and reassuring check on the executive power. There is provision for immediate reference to a court and for immediate judicial review. However, a point that came out of the contribution from the noble Baroness, Lady Hamwee, this afternoon is very important: it must be clear that if such a judicial review is to take place, that court must have access to the evidence on which the Treasury’s decision has been based. If it does not have access to the evidence on which the decision is based, how can it possibly decide whether that decision was reasonable? I would be grateful if the Government can reassure me that that will indeed happen.

There has been no mention at all, in the Bill itself or in the discussion so far, of a matter which your Lordships ought to consider: compensation in the case of an unjust or unreasonable freezing of assets. It is quite clear that any of us, any citizen, could be the object of a terrible mistake—not necessarily a wilful mistake, but a complete mistake. A completely innocent citizen could find his or her assets frozen and consequently incur considerable losses, for example by being unable to meet contractual obligations during the period of the asset freezing. The Bill does not seem to address the issue but I am sure that the House will want to satisfy itself one way or the other on it before approving the Bill in its final form. I might come back to the point in subsequent debates on the Bill.

My final general point on the Bill is that there seems to be something of a consensus in the House this afternoon in favour of a consolidation exercise, because there are clearly so many different instruments which can be used to freeze particular assets of criminals, or terrorist members of al-Qaeda, or otherwise the Taliban, and it is not immediately logical why there should be separate instruments. I had rather thought that the Government accepted in practice the case for consolidation. For example, the noble Lord, Lord Sassoon, defended Clause 22 in its present shape on the basis that its text was identical to that in another, parallel piece of legislation. Once you make that argument, you are basically saying that you really need to have one text. One is therefore making an argument for consolidation. I hope the Government will look again at that issue, and perhaps slightly more urgently than they seem to have done up until now.

My substantive suggestion is that this seems an ideal opportunity to deal with an extraordinary lacuna in the total regime for dealing with criminal and terrorist assets—the lack of any regime whatever to deal with ransoms from hijackings and piracy. It seems to me that those are the proceeds of crime as much as anything else. Indeed, for the victims of a hijacking by pirates, the experience probably does not seem very different from the experience of the victims of terrorists. Yet, at present, we have a growing industry of piracy in the Indian Ocean. People of my generation tend to think of pirates as existing only in fables. I have always thought of Treasure Island when I hear the word pirate, but pirates, as we know, were a real scourge of civilisation in the 16th, 17th and into the 18th centuries, as they no doubt were in previous centuries too. They were largely eliminated in the 19th century by the Royal Navy, often in combination or co-operation with other navies, and it is fair to say that in the 20th century, piracy no longer seemed any more immediate a threat to humanity than the bubonic plague. We took it for granted that it was something in the past.

The 21st century has taught us that that is not correct, and we have a major problem with the growing industry of piracy. There is a problem on both sides, because the risks are minimal to the pirates while the rewards are extremely great. The risks are minimal not because states have done nothing about it; on the contrary, three naval task forces—one EU, one NATO and one American-led—are currently deployed against these pirates. Nevertheless the pirates know that those forces’ rules of engagement are such that no pirate risks being shot unless the pirates open fire first, and although they have made that mistake in the past—the Royal Marines have accounted for a number of pirates, as have the French—no pirates have been lost over the past year or so. The pirates now feel that they have the mastery of that particular game.

Moreover, if the pirates are arrested they are never brought back to this country for trial, because the feeling from the legal advice is that they would immediately ask for asylum and the courts here would give it to them, and that they would remain here for the rest of time. It is not possible to repatriate them to Somalia because there is also legal advice saying that that would be against their human rights. We have a deal with Kenya to accept pirates and put them on trial, but that is an insecure situation; one does not know how long it will continue.

The sanctions are not very great. The danger of any pirate being interfered with by a naval task force is nothing like as great as it ought to be, simply because there is a natural reluctance for any nation state taking part in those task forces to risk its own sailors or marines, except where vessels fly their own flag, although the coincidence of having the right vessel there at the right time so that the nationality of the naval vessel is the same as that of the victims of the pirate attack is a bit difficult to achieve.

On the risk side, the problem is that the risks are not very great. On the reward side, as I have said, the rewards are enormous; I have made some effort to quantify them but I cannot because people are naturally reticent about it. It is clear to me, though, from discussions with underwriters here in London that tens of millions of pounds have been paid by way of ransom quite legally by ship owners and underwriters in respect of ships chartered or underwritten in this country over the past 12 months. The figures are substantial, I am quite convinced—perhaps the Government have some idea of what they are. It would be extremely revealing if we knew what they were.

The idea of taking measures against piracy, sending task forces at great expense, while doing nothing at all about the ransom payments, which can be paid over totally legally, accumulated, managed, transferred and then banked by the pirates, seems to be the equivalent of calling for the fire brigade and continuing to pump petrol on to the flames. There is a complete contradiction here between our apparent determination to deal seriously with the piracy issue and our failure to include it in any terrorist or criminal asset regime. I put that thought to the House, and I look forward to the Government’s response and to taking further part in discussions on this important Bill.