Proceeds of Crime Bill

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Mr. Ainsworth: Any action will have to be justified by proportionality.

Mr. Grieve: Of course.

Mr. Ainsworth: It will also have to be taken in pursuance of the case that the director is working on. There will have to be good reasons for him to seek the information in the first place.

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Mr. Grieve: I agree that the proportionality test will have to be passed. On the basis of what the Minister has said, I am also confident that in those circumstances, the commissioners might say, ''Hold on a minute. You are not suggesting that you have a suspicion about Mr. Bloggs, so why do you want his tax information?'' I would have thought that the director would have to provide a compelling justification for that. However, to return to the point made by the hon. Member for Glasgow, Pollok, that could happen now, whereas in my view it could not have happened previously.

When we consider such issues, it is worth remembering that there are potential and intended consequences that could touch not only the person in the mind of the hon. Member for Glasgow, Pollok, but someone whom an outsider might consider innocent of wrongdoing. Of course the director must maintain confidentiality. That important safeguard is in later clauses, but the director and the Inland Revenue are not one and the same. The information will have been supplied to the Revenue for one purpose, but could be used for another.

Mr. Davidson: The hon. Gentleman has mentioned consequences, but as I understand it, there would be consequences only if, as a result of wrongdoing being discovered, action was taken. As far as I am concerned, that is fair enough. If the hon. Gentleman wants to defend people who commit crimes or cheat on their taxes, that is his position. I ask him to consider the idea that information should be provided even more widely. Indeed, I would be happy for information discovered in this way to be passed to the Child Support Agency, to allow it to raise charges against individuals who can well afford to pay maintenance but who have managed to conceal assets.

Mr. Grieve: The hon. Gentleman has made his position clear as the Bill has passed through the Committee. He believes that to maintain order in society and the authority of the state, it would be desirable to have Big Brother, and information being fed in centrally from every Department and pooled, to root out all the evils, and above all, the sources of criminality, that he perceives as affecting his constituents. I understand that perfectly.

The hon. Gentleman may have appreciated that although philosophically I wish to root out criminality, I am perhaps a little more conscious of the existence of original sin, and the fact that we do not usually succeed. I am also dubious about regulation, because my experience—and, I think, the historical experience—suggests that the more we regulate, the more we have to regulate, and it becomes a tortuous circle that does not deliver the desired outcome. Moreover, the consequence of breaking down walls of confidentiality is that the flow of information dries up.

There are startling contrasts within Europe in people's readiness to deal honestly with the tax authorities in their countries. Although honesty in Britain may be being eroded, historically, the British have widely been viewed as more honest than many others in their dealings with the tax man—I see the

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Minister nodding. Part of my background is French, and the long tradition of concealing information from the authorities in France has been difficult to break away from in a democratic age. I am concerned to ensure that that does not happen here, because it will lead to worse rather than better governance.

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Mr. Ainsworth: While we are agreeing, I wish to raise a few points. The proposal is not, as the hon. Gentleman suggests, entirely novel. Tax authorities are already obliged to disclose, or can disclose, information within certain parameters; the provision is just another gateway. Also while we are agreeing, will he not confirm that the allegations that other Conservative Members have made about the provision allowing for fishing expeditions cannot be justified?

Mr. Grieve: If the legislation is properly implemented by those who have been given the powers and discretions that it provides, I expect that the results of any fishing expedition would be thrown in the wastepaper basket.

Mr. Ainsworth: Absolutely.

Mr. Grieve: On the basis of the reputation of those bodies, I expect that a problem would not develop, but my hon. Friend the Member for Cities of London and Westminster is right: the price of maintaining such standards is eternal vigilance. It is absolutely right to raise these troubling issues.

Unfortunately, there are many countries, including some of our democratic partners within the European Union, in which the required degree of competence would not exist, and there is ample demonstration of abuses by authorities against citizens—and the converse, which is the refusal of citizens to co-operate with authorities. Philosophically, as a Conservative, I wish to avoid that situation. We must maintain our standards to prevent deterioration in such relationships.

Mr. Wilshire: I am grateful to my hon. Friend for letting me down as gently as possible. However, I do not share his faith in human nature. If there is a loophole, someone will use it sooner or later, and the findings of a fishing expedition may not end up in the wastepaper basket. Once someone knows something, however they discovered it, they cannot ''unknow'' it. We had that debate earlier. Thus it would be sensible to close the loophole and remove temptation, so that human nature can be protected from itself.

Mr. Grieve: My hon. Friend makes a good point—but I was not trying to let him down gently. There have indeed been examples of misuse of authority in this country over the past 40 or 50 years, and there is no point in pretending otherwise. My hon. Friend was right to say that such abuse occurs even within our society.

Government Departments have misused their authority, but I cannot immediately bring to mind an example involving the Inland Revenue. It has a particularly high reputation worldwide in its dealings with taxpayers and citizens. It is precisely because it

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has exercised its discretion so well that I do not wish to see its reputation sullied by anything that we decide in Committee. I shall not repeat what has been said, but I see no reason why, if the provisions are properly implemented, that should happen.

The amendment would go well beyond closing loopholes; it would eliminate one of the central planks of the Government's intentions, from which we do not dissociate ourselves. That is why I said that this was a probing amendment. I am grateful to my hon. Friend and to the other hon. Members who have participated in the debate, because it is important that members of the Committee highlight their concerns. I fear that if we did not do that, things would get a bit lax; loopholes would appear and fishing expeditions would start, and that is not what is intended.

I am grateful for the Minister's comments and for other hon. Members' contributions. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Mr. Grieve: I beg to move amendment No. 604, in page 244, line 33, leave out subsection (6).

The Chairman: With this we may take the following amendments: No. 605, in page 244, line 35, leave out subsection (7).

No. 615, in clause 425, page 247, line 19, leave out subsection (6).

No. 616, in page 247, line 21, leave out subsection (7).

Mr. Grieve: Again, this is a probing amendment designed to elicit a debate on what the clause is about. Two of the four amendments are mirror images of the other two, except that they relate to Scotland, so—with apologies to Scottish Members—we need concern ourselves only with amendments Nos. 604 and 605.

What is subsection (6) designed to achieve? It states:

    The Secretary of State may by order designate as permitted persons other persons who exercise functions which he believes are of a public nature.

He will thereby make those people permitted persons for the purpose of exchanging information with the director. I am a bit troubled by that. We spend a lot of time in Committee emphasising the unusual nature of the director's powers and going into great detail to consider which organisations should be allowed to exchange information with him. Yet here is a little Henry VIII clause saying that when the Bill is enacted the Secretary of State can, by statutory instrument, designate any other body that he thinks necessary as falling within that criterion.

The Minister will probably tell us that we cannot see into the future, and that other bodies may be set up which need to have similar powers. But as those bodies do not exist at present—it is difficult to believe that they will not be set up except on a statutory basis—the matter should be considered during the passage of primary legislation relating to such a body or in the amending clauses of other measures as part of the primary legislative process.

I am not happy about the use of statutory instruments—and I was a member of the Joint

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Committee on Statutory Instruments until the general election. In 1966 there were about 36; there has been an exponential rise in their number, and this year, under the new Government, there are more than 4,000, the highest figure ever. There are far too many statutory instruments, to which I have a deep aversion, and we lack the ability to give them adequate scrutiny.

Why is subsection (6) necessary? The amendment to subsection (7) is consequential, and if subsection (6) were to remain, I would not want to get rid of subsection (7), as it provides an extra safeguard.

Mr. Wilshire: I agree with my hon. Friend, and I would go further: if subsection (6) were to remain in the Bill, I would have profound reservations about subsection (7), for reasons that I shall explain.

There is one redeeming feature in the debate. If I understand correctly, should the clause stand part of the Bill—and I suspect that we would lose a vote to reject it—any change would be subject to affirmative resolution in both Houses. Although that is a safeguard of a sort, it is not strong enough, because a Government with a large majority in the House can get what they want. There will be no real safeguard until after the next general election, when we will have got rid of this wretched Government. I suspect that we must face the inevitable for a year or two and say that the safeguard is not much use—which leads us to ask whether the clause should be in the Bill at all.

My hon. Friend rightly focused attention on the creation of new bodies. He is absolutely right—if the Government create a new body, the matter can easily be dealt with as he described. However, the clause is not confined in that way. It does not say that the Secretary of State can designate any new body that is set up, but that he may designate anyone or anything else, and that could include existing bodies.

We must examine what the Government are up to by suggesting that they produce a list for us—we have debated other lists in the past. It is crucial that we say to the Government, ''You must tell us. Is subsection (6) necessary in case you have forgotten something? Do you have something in mind that you do not want to tell us about, or are you doing this in case something crops up in the future?'' I do not like this type of thing, and Parliament should not accept it.

Either the list is comprehensive because of research, or it is not. Why list anyone if the Government are saying, ''We will put whoever we want on the list in due course,'' and they intend to use a statutory instrument to do so? That is not good enough. If there are existing bodies that have a contribution to make, let the Government say so now, so that we can debate whether those bodies are appropriate. To say at this stage, ''We might think up some more,'' could mean either that there has been a genuine oversight, or that the Government have something up their sleeves that they do not want us to know about yet. Perhaps the Minister can give us some examples of the type of bodies in question.

We are told that

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    The Secretary of State may by order designate as permitted persons other persons who exercise functions which he believes are of a public nature.

What in heaven's name does ''of a public nature'' mean? Does it refer to a branch of Government or an executive agency? ''Of a public nature'' could mean anything. Chelsea football club are ''of a public nature'' because lots of people go and watch them perform in public. That is a sloppy use of words.

What does the Minister mean when he asks us to approve such a provision? He should be much clearer, unless there is some legal definition of the phrase ''of a public nature'' that I, as a non-lawyer, do not know about. I would be perfectly willing to receive another free exposition or legal seminar on what the term means should somebody be willing to give one—that would be cheaper than buying one later.

The fact that the Secretary of State may designate a person who is of a public nature is not what concerns me. It is the phrase ''which he believes'' that is worrying. Even if we were to receive a free definition from the lawyers of the meaning of ''of a public nature'' in the current wording, a Secretary of State would only have to say, ''I believe them to be'', not that they actually were. The Secretary of State can, on a whim, decide to say to himself, ''This is of a public nature''. Ergo, it is covered. That is sloppy legislation.

It is not acceptable to say that if one thinks something is of a public nature, it therefore is. That is not how I understand the process of law to work. One should be able to test the law. We should be told who the permitted persons will be, so that we can consider their appropriateness. We need a proper definition of ''public nature'' and we need to remove doubt about how the clause should be interpreted.

Amendment No. 604 concerns the issues with which the Minister must deal. Amendment No. 605 would delete subsection (7), which would narrow the powers. The notes that the Minister kindly provided also show that that is the case. However, those notes raise an issue that is about more than one thing leading from another, which is why I referred to the comments made by my hon. Friend the Member for Beaconsfield.

The example cited in the notes is that the Secretary of State for Trade and Industry could be designated as a proper person of a public nature, although she would not necessarily be designated as a permitted person in a general sense. Under subsection (7), the Secretary of State would be required to designate a relevant function—in this case, the insolvency functions—within the Department of Trade and Industry. That is an existing body, not a new body—that is what my hon. Friend was talking about.

It worries me that a person may be a permitted person, but the designation power is limited to specific functions; none of the others listed are limited at the moment. That brings us back to the fact that when a person knows something, he cannot ''unknow'' it.

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