Proceeds of Crime Bill

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Mr. Mark Field: I take on board the points made by the hon. Members for Glasgow, Pollok and for Wrexham (Ian Lucas), but we must be flexible. Opposition Members would rather use the word ``may'' than ``must'', given the great demands that will be placed on the director of the agency to involve many people—not just those who are regulators already, or those who are compliance officers in the Financial Services Authority, but professionals in law firms, accountancy firms and banks.

I do not wish to stray from the subject, but I would like to address the matters raised by the hon. Member for Glasgow, Pollok. There is no risk of Opposition Members going easy on the City. My constituency includes the City of London and its financial and commercial interests. It does the country no great favours if financial services have an easy regime. I share his concerns about the bad apples in the barrel. We must do all that we can to ensure that they are rooted out and exposed, but as I mentioned on Second Reading, we are concerned about loading more and more regulations on large City institutions, particularly at this end of the economic cycle.

An army of compliance officers will have to be employed as a result of much of what we will discuss in the weeks and months ahead. As a result, business will be gridlocked, and I am concerned that the majority of legitimate business may go elsewhere, out of the City of London. That would damage the interests not only of the City, but of Europe's fifth largest financial centre, Edinburgh.

Mr. Davidson: That is a helpful point, but such arguments for flexibility and light regulation serve indirectly as arguments for the creation of loopholes. It would be better if the hon. Gentleman and his colleagues produced workable alternatives that satisfied his and our objectives for the Bill.

Mr. Field: There will be plenty of opportunity in considering the remaining 441 clauses to draft workable alternatives. I take on board the hon. Gentleman's point. We want to be constructive in the early stages of the Bill, and on the subject of light regulation. That is why we tabled the amendment. I have listened carefully, as we all have, for the past 20 minutes. I am not going to guess what my hon. Friend the Member for Surrey Heath will do with the amendment, but if we divide on it, we will know where we stand on the subject.

Mr. Bob Ainsworth: It will be interesting to see how independently minded the hon. Gentleman will be when the hon. Member for Surrey Heath calls for Divisions in future. It is often alleged that the Government do not permit independent judgment, but some has already been displayed in the Committee, so we shall see whether there is any independence among the Opposition. For reasons that have been exposed by my hon. Friends and the hon. Member for Orkney and Shetland, I shall not reflect on the issue. I say, in particular, to the hon. Member for Surrey Heath that there are two main motivations for accreditation, one of which is to lift standards and to ensure that we have a cadre of decent people with the necessary skills to use the powers under the Bill. The performance and innovation unit study exposed the fact that we were short of such skills in this country, which was part of the reason why the confiscation of proceeds of crime was not effective here. That is only one of the motivations for the giving the director—or, rather, directing the director of the agency to provide an accreditation system. Unless we have such an accreditation system as a gateway to the powers under the Bill, we will have no control over the quality of the people who are using the powers—unless it is the Opposition's intention that those powers not be used. Such powers are at the heart of the Bill.

The purpose of an accreditation system is to provide people who are necessary to carry out the functions and to raise the capacity and quality in such an area and to provide necessary safeguards, so I cannot accept the amendment. My hon. Friend the Member for Glasgow, Pollok asked whether there will be two systems. We are not dictating to the director that there must a simple system of accreditation. It will be for him to decide what level of training is necessary for the different people in the agency and whether there should be different levels of accreditation. To use the powers under the Bill, people will need to attain a level of accreditation.

Under the Bill, there will not be accredited financial investigators in Scotland. However, we do not envisage barring Scottish people from becoming accredited or from being trained in the centre of excellence. When we come to the parts of the Bill that apply to Scotland, the Committee will see that the necessary provision for quality control of people north of the border needs to exist as it does within the agency itself.

Mr. Davidson: I raised the point because of what my hon. Friend said earlier about cross-border traffic. I want Scottish investigators to continue to be able to pursue cases in England and Wales with co-operation, and vice versa. We do not want to have courts or lawyers in the respective countries demanding that certain matters be ruled out on the basis that accreditation gained elsewhere is not recognised. I hope that he recognises that and will ensure that the Bill takes account of that potential difficulty, which will be exploited by bad people.

Mr. Ainsworth: My hon. Friend is absolutely right and I am sure that one of the reasons why he wanted to be a member of the Committee was to make certain that there is the cross-border co-operation that is required to make the Bill effective. Such discussions are on-going and many of them have already taken place. There must be cross-border co-operation. If we provide a loophole, we can rest assured that it will be exploited to the full to circumvent the measures that we are taking to recover proceeds of crime. I fully accept my hon. Friend's point.

For the reasons that I have stated, I cannot accept the amendment. I ask the hon. Member for Surrey Heath to withdraw. If he does not, I shall have to ask my hon. Friends to vote against it.

Mr. Hawkins: I am disappointed by the Minister's response. I had hoped that he would register our concern that the director, once appointed, should have the discretion to decide whether that was the way forward. The Minister was didactic and said that he was certain that he wants the Government to direct the director. He almost gave the game away, however, when he nearly made a slip of the tongue. He was about to say that that is why the Government want the director to have those powers, which our amendment suggested, but he stopped himself just in time and said that that is why the Government want to direct the director. We all heard that, and it will be recorded in Hansard. The Government want to direct: that is instinctively part of their approach. As I mentioned in the case of Mr. Hellawell, the drugs tsar, it is a problem only when the Government reverse their policy by 180 deg, and direct in the other direction. Precisely because of that recent U-turn, and other recent policy U-turns, especially in the Home Office, we felt that it would be wiser for the Bill to be permissive, as the amendment suggests.

12.45 pm

Despite what the Minister says, perhaps he will reflect on that with his officials. I want to reassure the hon. Member for Glasgow, Pollok that we are not engaged in a bid to emasculate the underlying intention of the Bill. As we said on Second Reading, and as my hon. Friend the Member for Cities of London and Westminster pointed out, we support the underlying intention. However, the purpose of parliamentary scrutiny is to try to get a Bill that works. We want to differentiate between reputable financial institutions, on which the economy of our country and the whole of Europe is based, and rogue ones. We want the Government's regime to be effective, but it is not sensible to be didactic and to impose a straitjacket on the director.

I was interested by what the hon. Member for Orkney and Shetland said, which strongly supported the Government's original drafting. All of us who have been involved in this field have become accustomed to the hon. Member for Southwark, North and Bermondsey (Simon Hughes)—who normally leads for the Liberal Democrats on such issues—constantly asking for measures that are not didactic but permissive. Those are the normal libertarian instincts of his party. We may now be hearing a new authoritarian Liberal Democrat voice.

Norman Baker: The hon. Gentleman is trying to impose a straitjacketed view, whereas our approach is to assess each amendment and proposal on its merits. It would be odd if Members of Parliament did not do that, as otherwise we could reach our positions before legislation is published, irrespective of the arguments that we encounter. It is, of course, disgraceful that my hon. Friend the Member for Southwark, North and Bermondsey should be so insulted in his absence. He will be deeply wounded when he learns of the hon. Gentleman's attack on him. I shall communicate it to him immediately after the sitting finishes.

This is the question that the hon. Gentleman must answer: does he not want investigators to be efficient, to be properly trained, to inspire confidence and to be resistant to any improper and unnecessary challenge to the work that they undertake? If he does want that, he should withdraw the amendment.

Mr. Hawkins: I hear what the hon. Gentleman is saying. His explanation is no doubt consistent with the way in which Liberal Democrats argue for one policy in one constituency, and the opposite policy in the neighbouring one. We are all familiar with that. He has simply not understood what the amendment would do. We are not seeking to say that there should not be any financial investigators. The amendment does not say that the director should not have power to set up the system. We have not undermined every aspect, or sought to remove the whole clause. We have merely said that the director should have the freedom to decide on which direction he should take once appointed. The hon. Gentleman does his argument no service by consciously and deliberately seeking to misrepresent the effect of our amendment.

 
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Prepared 13 November 2001