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Lord Henley: My Lords, on that point perhaps this may be a suitable moment to ask the noble and learned Lord whether he would agree to this suggestion. He has been most conscientious in the replies he has given and has covered a great many points put forward by Members on all sides of the House. However, we would like the guarantee that he will answer by letter all the points which he was not able to deal with. He might then find that it would speed up the Committee stage process, since he said that many points would be more appropriately left to that stage. If he or his noble friend

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could write to noble Lords on points not covered, then I and probably other Members of the House, including the noble Viscount, Lord Tenby, would be grateful.

Lord Falconer of Thoroton: My Lords, we would be willing to do that. We shall have to go through Hansard and see which points it will be appropriate to answer. But, in principle, we would do that and one hopes that it would shorten the Committee stage of the Bill.

In the light of that, perhaps I can deal with two further matters of principle that formed an important subject of debate. The first is that a considerable number of questions were asked and points made in relation to racially aggravated offences. It would be fair to say that there was a broad welcome for legislation on racially aggravated offences. Some people asked if it was necessary and, if not, why were the Government introducing it.

The Bill makes two important improvements to the current law. It increases maximum sentences in relation to racially aggravated crime. Also, it creates the offence of a racially aggravated crime. Those new crimes are in the Bill in order to underline the importance that this Government attach to stamping out racially aggravated crime. The effect of including the provision in the Bill and making it a crime is that it will compel the evidence gatherers in specific cases to focus upon the issue of racial aggravation in respect of those matters. We believe that that is a good thing and an important message to send to the world.

The noble Baroness, Lady Flather, asked why it does not apply to all crimes. Practically speaking, one cannot attach racial aggravation as an element to every crime. However, Section 68 of the Bill says that in all crimes racial aggravation will be a factor that can increase the sentence. We therefore believe that we have gone a significant way to meet what the noble Baroness, Lady Flather, would wish.

We note and take account of what the noble Baroness, Lady Amos, said: that is, that effective implementation is important. We agree with that and will bear that very much in mind. We believe that these provisions make a real difference; it is worthwhile to include them in the Bill and therefore we intend to proceed with them.

In relation to Scotland, I take on board what was said by the noble Baroness, Lady Anelay, and stray into Scottish law with considerable reluctance. We are aware that certain elements of the legal order--if I may call it that--suggested that there was no need for this Bill in Scotland. However, certain parts of the community in Scotland, in particular ethnic groups, felt that it would be worthwhile to introduce this provision into Scotland. Taking full account of the consultation we had, including the remarks of the noble and learned Lord, Lord Rodger of Earlsferry, we nevertheless decided that it was an appropriate course to take.

The noble Earl, Lord Mar and Kellie, felt that we should not be legislating at all in relation to Scotland because of the impending devolution Bill. That is one view. But, as it will be two years before the Scottish parliament is capable of passing any sort of Bill, that

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seems rather a long time for Scotland to wait for any legislation of any sort. We therefore did not accept that view.

The other issue on which I should like to touch concerns sentencing guidelines. The noble and learned Lord, Lord Ackner, said that we should not interfere with the judges' discretion. We do not believe that we are interfering with the judges' discretion. It is good for consistency that judges give guidelines on certain issues. The structure of the Bill is such that, if the court does not think it appropriate to give guidelines, it is not obliged to do so. We are grateful to the noble and learned Lord, Lord Bingham of Cornhill, for saying that he is broadly content with the provisions in relation to sentencing guidelines.

I apologise for going on for so long, and I apologise for not answering every question that has been raised. Speaking for myself, I have found the debate immensely useful, immensely constructive and, having regard to the tone and quality of the debate today, I believe we will have an excellent debate at Committee and Report stages.

On Question, Bill read a second time, and committed to a Committee of the whole House.

Firearms (Amendment) (No. 2) Act 1997 Compensation Scheme

9.25 p.m.

Lord Williams of Mostyn rose to move, That the draft scheme laid before the House on 27th November be approved [15th Report from the Joint Committee].

The noble Lord said: My Lords, this draft scheme has been laid under Section 18 of the Firearms (Amendment) Act 1997, as amended by the new Firearms (Amendment) (No. 2) Act.

Since 1st July of this year an ex gratia scheme has been in place covering payments to those who have chosen to hand in their small-calibre pistols rather than await the passing of the new Act. To date, over 26,000 of these firearms have been given up, in addition to the 116,000 large-calibre handguns that were surrendered in the three-month period from 1st July. Over £27.6 million has already been paid out from the scheme. Of course, the final figure will be higher when the remaining claims and ex gratia applications have been processed.

The scheme we are considering today is virtually identical to the ex gratia scheme. We have given assurances that those who chose to surrender their small-calibre pistols voluntarily under the ex gratia scheme would not be disadvantaged compared with those who have waited to surrender their pistols under the formal scheme. That is why the two schemes must be consistent.

We estimate that no more than 10,000 pistols are still held lawfully throughout England, Wales and Scotland. This is a little under 200 firearms per police force. The police assessment is that this number of firearms can be

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processed within one month, and we have therefore set the surrender period as 1st to 28th February 1998. All the necessary documents can be sent out by police forces in good time to potential claimants. In setting February as the hand-in period, we did not forget that the second anniversary of the Dunblane tragedy falls on 13th March.

The scheme itself will operate in the same way as the main compensation scheme already agreed by this House on 9th June. Before the hand-in period begins, certificate holders and dealers will receive full details of the new scheme together with application forms and advice on where and when to surrender their weapons. They must complete the appropriate claim form in respect of their weapons and equipment and hand this to the police at the time of surrender. Individuals will have a choice of three options. They may choose to accept a flat rate of £100 for their weapon. Alternatively, they may choose a standard rate for their weapon from the list of published values at Annex A for the most commonly held pistols. If they do not wish to accept the flat rate payment, and if their gun is either not on the list at Annex A or is markedly different from those that are on the list, they may choose the third option. This means a submission of claim, supported by an independent valuation or other evidence corroborating the value of the items surrendered. An extract or copy from a published source as at 16th October 1996 would often be acceptable and therefore an individual valuation will not be necessary in every case.

Similar arrangements will apply to dealers. They will be able to claim under any of the three options. They will be able to claim under the third option even though their stock may already be listed at Annex A.

The firearms must be handed over to a designated police station, as specified by the relevant chief constable. Special arrangements will be made with dealers because of the number of weapons they may have in stock.

Similar arrangements will apply to ancillary equipment which can only be used in connection with the pistols. The corresponding values are set out in Annexes B, C and D of the draft scheme. This is in accordance with the requirements of Section 17 of the 1997 Act (and Section 16 in respect of expanding ammunition) as amended by the latest Act. As under the previous scheme, this equipment will not itself become prohibited but the Government accept that where it cannot be put to any other use, such as with rifles, then compensation should be paid.

The claim forms will initially be checked by the police who will then send them to the Firearms Compensation Section of the Home Office for processing.

There are two points of detail in the scheme that I should draw to the attention of the House. First, two operative dates are mentioned in the scheme: 14th May 1997 (for possession of the firearms or equipment on the date of the Queen's Speech when the Government formally announced their intention to ban small-calibre pistols) and 16th October 1996 (for the values at the

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time when the previous Government announced their intention to ban large-calibre handguns). When calculating the values of small-calibre pistols for the ex gratia scheme it was agreed to use the same October 1996 date because values for all handguns generally fell from that point. Taking the values as at 14th May 1997 could have given rise to criticism for treating shooters unfairly. Taking the earlier date is, we believe, in the best interests of shooters. I explained the reason to the House on 9th June.

For the sake of precision we have added three categories of ancillary equipment to the scheme: speed-loaders, speed-loader pouches and quantities of spare parts held by registered dealers. Component parts which have to be held on a firearm certificate, such as barrels and cylinders, were already in the ex gratia scheme.

We have decided to add these three categories because they were appended to the earlier compensation scheme after it was approved, but on an ex gratia basis. These three categories were genuine oversights and as payments are being made on them under the previous scheme it is only right that they should be included specifically in the new scheme and that the House should have the most up-to-date information possible available to it today.

We have not added additional pistol makes to the annexes because of the need to keep the schemes consistent and not to prejudice those who had chosen to hand in their pistols early. Any pistol not listed will need to be claimed for under options A or C. I have already indicated that an extract from a published source on or before 16th October 1996 will generally be acceptable as evidence of value and an individual valuation will not always be necessary.

I wish publicly to thank the people working in the Firearms Compensation Section who have moved a mountain of paperwork so that people get their compensation as quickly as possible. I regret that there has been some attempt to undermine confidence and to criticise the rate at which claims under the large-calibre scheme are being dealt with.

I am able to tell the House about the progress that has been made. As at 12th December, 39,896 claims have been received, and 23,183 payments have been made, to a total value of £27.6 million. Most claims under options A and B will have been dealt with before the end of March, and regular payments on option C claims will have begun by then. Some dealers who have claimed under option C will already have received at least an interim payment by now. The additional new claims in respect of up to 10,000 guns will add to the current pressures upon the FCS but the processes and procedures involved in dealing with these claims will be no different from those already in train.

There were teething troubles with the purpose-built FCS computer system which slowed down the initial processing rate. We hope that those teething problems have been completely overcome. Staff are working hard to deal with claims as quickly as possible. Weekend overtime is being worked and measures have been taken

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to boost the number of staff engaged in the primary task of examining claims. The work is not simply the automatic payment of claims when received. All the claims have to be examined carefully to ensure that the items surrendered are eligible for compensation under the scheme and that the correct scale of payment is made. We are committed to keeping up the pace of processing the claims but we cannot lose sight of the need to maintain the proper checks and balances to ensure correct payment and prevent fraud.

It is not a simple rubber-stamping exercise. A great many claims--unfortunately, about 35 per cent. of those received--have been wrongly completed. Common mistakes include descriptions of items not matching the code numbers on the published list; lack of details under certain headings, such as "specialised tools"; and payment details, such as bank account numbers, are sometimes wrong. If 35 per cent. of forms are not properly completed, that adds to overall delay and takes up valuable staff time to resolve. Unfortunately, a number of cases of possible fraud have come to light and are presently the subject of criminal investigations. I cannot give details of those cases, for obvious reasons. But we are dealing with public money and we have to be careful about the mechanisms in place to control and avoid fraud.

We are looking at ways and means of improving the throughput of cases. There have been improvements. In July the total number of payments was only 351 because of the problems with the computer system. In August the number of payments rose to 2,602 and in September to 4,091. This improvement has continued. The average number of weekly payments is now running at 1,400.

We are keeping the promise of compensation which is reasonable and which is paid out in order to fulfil our promise to the British public to end private ownership of handguns. The scheme is no more and no less than the ex gratia scheme that has been in place since 1st July. There have been no major criticisms of that scheme which, we believe, properly compensates the owners of small calibre pistols and related equipment. I commend the scheme to the House.

Moved, That the draft scheme laid before the House on 27th November be approved [15th Report from the Joint Committee].--(Lord Williams of Mostyn.)

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