Private Security Industry Bill [Lords]

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Mr. Hawkins: I was saying to the right hon. Member for Walsall, South and the hon. Member for Eccles that, as they are aware, we share several of the concerns that they have raised on behalf of employers and the major security groups. In tune with their remarks, we stress the hope that the Minister will keep such issues under consideration.

As I was saying when the Division bell rang, we will return to those matters when discussing amendment No. 32 to schedule 2. Parts of that schedule—to which the right hon. Member for Walsall, South has also tabled amendments—are linked to clause 3. Whether the issues are more thoroughly debated at this stage or when we discuss schedule 2 is something of a toss-up. I suspect that we will have a longer debate on some of the CBI-related and Control Risks-type issues when we debate the amendments to schedule 2.

While I encourage the Minister and his officials to keep the matters in mind, I otherwise restrict myself to echoing what the right hon. Gentleman and the hon. Gentleman said. They were right to point out that the issues are important, crucial especially to companies of the size that are represented by the association of corporate investigation consultancies. We will undoubtedly return to what the Confederation of British Industry believes that the Government have inadvertently done by including aspects that could apply to catch IT security consultants within the Bill's ambit. I do not want to detain the Committee further at this stage, but I will listen to the Minister's response with interest. I think that we will spend some time on the issues later.

Mr. Andrew Miller (Ellesmere Port and Neston): My hon. Friend the Member for Eccles raised an important point, which my right hon. Friend the Member for Walsall, South and the hon. Member for Surrey Heath reinforced. I find myself in the unusual position of agreeing with the latter. The issue is important. When we debate schedule 2, it will be important for the Government to have made clear their position about the merits and demerits of separating the physical from the virtual world, and whether it is technically possible to do that for the kind of businesses that we are discussing. Some businesses that provide physical security on premises might also, by the terms of their contractual obligations, be responsible for electronic security, to which the IT provisions relate.

5.30 pm

That field is becoming immensely complicated. I do not know whether my colleagues have read the exciting description of a British first in the newspapers this morning. This might be an impossibility for Hansard, but the product is called ``: : mail''. It is a new virus tool being produced by the Defence Evaluation and Research Agency. Such developments will be immensely important to industry. One would not want to curtail the development and application of such tools because of the corporate criminality to which my right hon. Friend the Member for Walsall, South alluded. However, we need to ensure that we do not exclude parts of businesses that may be properly included in the Bill in the context of their provision of physical security.

Mr. Bercow: I understand the point that the hon. Gentleman makes about the difficulty of distinguishing between the two types of work when referring to employees. The job definition of someone responsible for physical security might also embrace some responsibility for electronic security. However, I should like to be clear about exactly where the hon. Gentleman is coming from. Does he think that, in so far as the two fields can be distinguished—which they often can—that of electronic security should not fall within the Bill's rubric?

Mr. Miller: My whole point in rising was to say that I am not convinced one way or the other. I think that there are merits in both cases. It is a technical area, and we must not end up with a Bill that is proscriptive and damages the security aspects of businesses' IT provision. At the same time, when my hon. Friend the Minister introduced the Bill, it was made clear that it was targeted at scams that are at the other end of the spectrum: cowboy wheelclampers and the small-time security companies that have failed to meet the standards recognised by my friends in Geneva, the international union Uni, which has negotiated many international agreements about the provision of physical security.

Such distinctions get more and more blurred as time goes on. It will be an interesting challenge for those folk who are not actually here to come up with the right balance. My instinct is that the CBI has an important point but, equally, there are merits in the alternative argument. The Committee should take the issue seriously, and take time over it. Any decision that we take will have important ramifications.

Mr. Charles Clarke: This has been a helpful little tour d'horizon. As hon. Members have indicated, when we debate schedule 2—paragraph 4 deals with private investigations and paragraph 5 with security consultants—we will pursue such matters in greater detail. However, I must make a couple of remarks about what has been said.

I first pick up on the IT point that was made by my right hon. Friend the Member for Walsall, South and then by other hon. Members. I agree that it is a substantive point, but I repeat what I said on Second Reading:

    ``The Department of Trade and Industry will therefore consult the information security industry on the extent and effectiveness of existing precautions—protected measures—and whether further action is required. In the light of that, I am happy to make it clear that we do not currently intend to bring the information security industry within the scope of the new licensing regime established by the Bill.''—[Official Report, 28 March 2001; Vol. 365, c. 974.]

I am happy to tell my right hon. Friend that the regime that applies to the major companies that he described does need to take account of the commercial situation of the companies and how it operates on the work that they carry out. I am ready to look at his specific points. Officials from my Department have already discussed those concerns with companies such as Kroll Associates and Control Risks. I give him the assurance that I will ask them to pursue that discussion further in the light of today's debate.

Mr. Hawkins: I am grateful for the Minister's helpful indications and am taking careful note of what he says. However, will the Minister say that he would be happy for his officials to have a specific meeting with those in the CBI who have concerns about the matter? It would be helpful if he could confirm that.

Mr. Clarke: I am able to confirm that. Indeed, I had a meeting with the CBI, at an earlier stage, to discuss those issues. We had a full discussion about what we should do.

Before we have a detailed discussion of schedule 2, I want to make a general point about the major dilemma referred to by my hon. Friend the Member for Ellesmere Port and Neston (Mr. Miller). Ten or 15 years in the future, if one were to want to subvert organisations by selling security services in a criminal way, it will no longer be a matter of sorting out door stewards in respect of dealing with drugs, but a matter of security systems installed in major corporations. We must bear in mind that the evolution of such systems will be important. A difficult balance of judgment will have to be made about how we decide between competing issues. For that reason, in the case of IT security, we have asked the Department of Trade and Industry to discuss with the industry how it might move forward.

We have also given a specific responsibility to the authority to keep such matters under review and to come back with proposals that ensure that we have a flexible process. We have taken the right approach in the Bill, as my hon. Friend was generous enough to say during the debate on clause 1. In the light of my remarks and assurances, and the further assurances that I will give during debate on schedule 2, I hope that the Committee will agree that clause 3 should stand part of the Bill.

Question put and agreed to.

Clause 3 ordered to stand part of the Bill.

Clause 4

Exemptions from licensing requirement

Mr. Fearn: I beg to move amendment No. 22, in page 4, line 34, leave out

    ``or, as the case may be,''

and insert ``and''.

The provision for exemption from licensing requirements seems reasonable; we all agree on that. However, we are concerned about the wide discretion given to the Secretary of State. Should not the authority, as the standard-setting body, agree whether an exemption is suitable? It would also be helpful to know when the Government envisage granting exemptions. Would they consider specifying in the Bill grounds on which exemptions might be allowed? As things stand, the Secretary of State can grant exemptions when suitable alternative arrangements exist, so in theory everyone is eligible for an exemption. Should there not be additional reasons for allowing exemptions, such as public interest grounds, which seem already to be established in the Bill? Perhaps the Minister will comment on that.

Given those concerns, we have tabled an amendment that would limit the Secretary of State's discretion. The amendment would require that both the authority ``and'' the Secretary of State be satisfied. It makes sense to require the authority to be consulted, as it will set the standards. It is a small and sensible amendment, so perhaps the Minister will accept it.

Mr. Charles Clarke: There might be some misunderstanding. My understanding is that amendment No. 22 would require both the Secretary of State and the authority to be satisfied that suitable alternative arrangements to licensing apply before a person may be exempt from licensing by virtue of subsections (1) or (2) of clause 4—that is, it requires a double approach. Our fundamental concern is about establishing parallel systems that will overload two different bodies—the Secretary of State and the authority—both of which will have to examine the same problem in any particular case. I urge the hon. Gentleman to withdraw the amendment.

Clause 4 provides for limited circumstances in which a person may engage in licensable conduct without possessing an appropriate licence from the authority. Subsection (1) permits the Secretary of State to make regulations establishing exemptions where he or she is satisfied that valid alternative vetting arrangements exist. If such valid alternatives are already applied in some circumstances, it would be superfluous and an unnecessary burden to require a licence also from the SIA. However, to do that, the Secretary of State must be sure that the arrangements provide adequate public protection.

Subsection (2) enables the regulations to delegate to the authority the power to determine whether an employer will ensure that suitable alternative arrangements apply. The authority may permit unlicensed persons temporarily to undertake licensable activities if they or their employers have received approved contractor status under clause 15 or have been given specific dispensation under clause 4, and if the security operatives already have a licence application pending and have not had a previous application rejected. Those are very narrow and precise circumstances. The public would, rightly, expect the general circumstances that are to be regarded as validly alternative to the authority's licensing procedures to be defined only after careful scrutiny.

Subsection (3) therefore requires that the proposed arrangements should satisfy the Secretary of State or the authority

    ``as the case may be''—

the words that amendment No. 22 would delete—in relation to the protection of the public. To require the Secretary of State to give his or her agreement each time the authority judges that an employer meets the criteria laid down in the regulations would lead to a bureaucratic system in which two separate but parallel agencies had to approve certain decisions. That would be regarded as over-regulation.

I hope that that explanation is clear. There may have been some misunderstanding between us, in which case I hope that the hon. Gentleman will withdraw the amendment. If not, I ask him to consider the fact that the effect of the amendment would be to establish two parallel bureaucracies, which we believe would be unnecessarily burdensome. I hope that the hon. Gentleman will now change his course of action.

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