Proceeds of Crime Bill

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Mr. Boris Johnson (Henley): How often does the Minister suppose that the Revenue would disclose details of people's tax affairs to the director? If that would be very rare, and there would be only half a dozen such instances a year, why should the function not be exercised by the commissioners?

2.46 pm

Sitting suspended for a Division in the House.

3.1 pm

On resuming--

Mr. Ainsworth: The hon. Member for Henley (Mr. Johnson) was asking a question that has already been raised: how often would the powers be used? That is obviously of interest to the Committee, and it would be nice to be able to pin down how many times they would be used. We said earlier that we envisaged civil recovery being used about 20 times a year, and we do not envisage the taxation powers in clause 311 being used much more often than thatperhaps 30 times a year.

It is not possible to say how many times it might be appropriate for the director to approach the Revenue for tax information when dealing with confiscation or civil recovery cases. He will be able to do so only when appropriate. The commissioners will consider the information that he asks for and check whether it is

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appropriate, and they will not disclose it if it is not. It would not be possible to give the hon. Member for Henley--had he been here--or anyone else a detailed analysis of how many times disclosure of information from the Revenue will be required.

We must get the director in place, establish the Assets Recovery Agency, set up the memorandum of understanding, and develop a method of working together. That is why I put such emphasis on the need within the agency for a culture that maintains the credibility of both the agency and the system, and has the high degree of credibility that those with which the agency will deal already have.

Mr. Wilshire: I am a little concerned that the Minister says that he has no idea how often the power will be used. I suspect that that is correct, because I have learned that the Government sometimes do not do their homework. There was a money resolution for the Bill, so calculations must have been made. Perhaps he could confirm that. If the power will be used thousands of times a year, we would need more officers to do the work, and that would cost money. The money resolution must have made some assumptions about the work involved.

Mr. Ainsworth: The hon. Gentleman is right to say that there was a money resolution, and that in order to justify it, a broad assessment was made of the volume of work that the agency would do.

We said that we envisaged that there would be about 250 cases a year in which confiscation would be handed on from the prosecuting authorities to the agency because they thought it necessary to use the agency's specialist skills. I think that that included about 20 to 25 civil recovery cases and a few more--perhaps 20 to 30--tax cases. It was not possible or necessary, when creating a regulatory impact study and a money resolution, to try to guess how many times those cases would involve requests to the Revenue for information.

It would be extremely difficult to be accurate about the number. If I were to try to give the hon. Gentleman an indication about that--based on how many confiscation cases were being heard, and whether repeat requests might arise as they progressed--it would be little more than a work of fiction, and that would be pointless.

I ask the Committee to accept that some common sense exists within the Revenue. The system will be set up under a memorandum of understanding. It would not be in the interests of the agency, the Revenue or Customs and Excise to delegate those powers to people who are not proficient or properly trained, and they certainly would not delegate them to people who were not committed to rules of confidentiality.

The key issue is whether we want to tie the organisations' hands, by telling them how they should delegate the powers. Do we wish to limit by statute how the Revenue organises its affairs, with regard to its dealings with the agency? That is the question that we should answer, because it addresses the substantive point.

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The amendments would remove or restrict the powers to delegate the responsibility for authorising and consenting to disclose. That could cause delay and lead to the disclosure of the director operating less than effectively. We believe that it is justified to have confidence that the organisations concerned will use the powers appropriately.

Mr. Dominic Grieve (Beaconsfield): The Minister has responded carefully to questions about several issuesand especially powers of delegation.

Amendment No. 607 concerns a slightly different matter. It deals with whether the Inland Revenue or Customs and Excise should be able to give a blanket right of further disclosure to the director, instead of each case being dealt with on its individual merits. As the debate has progressed, that has become the provision that troubles me most. I have not been convinced that it is necessary, particularly in the light of the number of cases that are likely to arise. One must bear it in mind that disclosure onward from the director can extend beyond the Government service, and out to a foreign country. That is why I am particularly concerned. Will the Minister comment on that?

Mr. Ainsworth: My response to that is broadly the same as to the previous matter. The Commissioners of the Revenue are not required to give a blanket right of further disclosure. They would consider giving that right only if the business that they were conducting with the director indicated that it would make a lot of sense to do that. If they were receiving repetitive requests that fell into exactly the same area, it might appear to be common sensefrom the points of view of themselves and the directorto grant coverage of a class of requests, rather than to continue to address cases on an individual basis.

The key issue is the same as it was with regard to the previous matter. I believe that we should be confident that the relevant organisations can exercise that power in a correct and appropriate manner. The hon. Gentleman believes that we should pin them down by insisting that cases are addressed on an individual basis. If we did that, we would, in effect, be saying to the Commissioners of the Inland Revenue that we do not care if, under certain circumstances, it becomes apparent to them that it would be common sense to grant class coverage.

I might be able to give the hon. Gentleman an example of specified circumstances. It could be said that that would be best for details about location--latest home address, latest employer's address, place of work--when assisting a criminal confiscation investigation. When there are criminal confiscation proceedings, do we want to prevent the commissioners from releasing details--with appropriate safeguards--of a person's last known place of employment? Do we want to insist that they look at every single case, and under no circumstances release those details, even if, after working with the agency for some time, it would clearly be sensible to do so? I am not sure that that is what Opposition members really want to do, and I ask

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them to think seriously about the amendments that they have tabled.

Mr. Grieve: I am grateful to the Minister for treating the amendments seriously, because certain issues needed to be addressed. He has persuaded me that it would be wrong to press to a Division an amendment that fetters the ability of the board to delegate. If the intention is for delegated officers with expertise within the Inland Revenue and Customs and Excise to deal with such applications, I am confident that they will be able to do so.

The issue raised by amendment No. 607 is slightly different. I regret that I did not table a similar amendment to the Scottish provision, so we have only the England and Wales and Northern Ireland provision to go by. I fully understand the Minister's point. The scope for a generic right to make an onward disclosure could be confined to particular types of information, such as a name and address. We are dealing not with disclosure to the director but with the director's right to make use of that information subsequently, without going back to the Revenue for authorisation. There are some important provisions under clause 423. It is clear that the director may want to use the information in various ways, including those that will enable him to carry out his functions. I have no difficulty with that, because it is axiomatic that the director will obtain the necessary information to perform those functions.

In addition, the provision extends to criminal proceedings in the United Kingdom, a subject that we will later discuss in principle. It places the director in a potentially advantageous position over other law enforcement authorities, in terms of obtaining evidence from the Inland Revenue for subsequent use. I am well aware that there are circumstances in which the Inland Revenue could be requested to provide information to law enforcement authorities that--under the current provisions--they might not otherwise have been able to obtain. That troubles me, especially if that information can be transmitted without its being looked at again and approved by the Inland Revenue or Customs and Excise, even if it is innocuous and generic, such as a name and address.

Even more pertinent are potential proceedings outside the United Kingdom, which would effectively be the transmission of that information to a foreign Government or law enforcement agency. The Minister will remember that, in a previous debate, I expressed my worry that human rights could be infringed if the foreign Government to whom disclosure was made were less scrupulous or less respectful than we are of those rights. That is a subject for concern, particularly with information on taxation.

3.15 pm

I can think of instances in which a person might have ''trouble'' with foreign tax enforcement authorities. The oppressive nature of the regime with which they were dealing would then give rise to serious hesitation about whether one should supply information to that country for the sake of obtaining that person's assets, which may be abroad. That information may relate to the commission of offences,

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but sometimes the two might be difficult to disentangle. I can easily imagine an unscrupulous Government masquerading a request for information on an alleged serious offence such as drug trafficking as a request for information for other purposes. Their allegations may not be justified.

I do not say that we should not give that information, but I should be unhappy if information relating to the confidential relationship between a citizen and the Inland Revenue were passed abroad under a generic heading without the Inland Revenue necessarily having the chance to reconsider that decision.

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