6 Nov 1998 : Column 451

House of Lords

Friday, 6th November 1998.

The House met at eleven of the clock: The LORD CHANCELLOR on the Woolsack.

Prayers--Read by the Lord Bishop of Lichfield.

Waste Minimisation Bill

Lord Hardy of Wath: My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.

Moved, That the House do now resolve itself into Committee.--(Lord Hardy of Wath.)

On Question, Motion agreed to.

House in Committee accordingly.

[The CHAIRMAN OF COMMITTEES in the Chair.]

Clause [Power to take steps to minimise generation of controlled waste]:

Earl Attlee moved the amendment:


Page 1, line 18, at end insert ("and shall also consult those whom the authority believes are the principal generators of controlled waste.")

The noble Earl said: I do not intend to press this amendment. If it were agreed to, it might be difficult for the other place to find the time to consider it.

With this kind of Bill, the issue of consultation is often high on the agenda. The issue is: who should be consulted? The Bill as drafted would grant powers to the relevant local authorities to take any measure to promote waste minimisation, but without any obligation to consult with those affected by any such decisions, in particular industry and commerce.

I fully accept that, as the Minister pointed out at Second Reading (col. 497) the Bill will not empower an authority to impose requirements or restrictions upon individuals or businesses within its area. On the other hand, it is clear that the relevant authority ought to consult, but not necessarily exhaustively, over minor issues. It would therefore be difficult to draft a simple amendment which would have the desired effect and be acceptable to the Committee. However, the Minister will no doubt issue guidelines, which it is to be hoped will make it clear that the relevant authorities are expected to consult as appropriate. If the Minister will give such an assurance to the Committee, I shall have no difficulty in withdrawing my amendment. I beg to move.

Lord Hardy of Wath: I am extremely grateful to the noble Earl, not least because he has made it clear that he will not press the amendment. The Bill has been around for some time. It is not a partisan measure. Indeed, it was first introduced in the other place by Mr. Gary Waller, who honourably contested my own constituency a long time ago.

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The noble Earl's amendment serves a useful purpose in that I hope it will allow my noble friend to offer the assurance that he seeks, and to make it clear that the Government expect local authorities to consult. It would have been difficult to find the words within the proposed measure to provide an accurate definition. Thus confusion will be avoided if we leave it to the Government to maintain the policy of issuing relevant and appropriate advice to the effect that they will expect local authorities to consult. That will encourage local authorities to do so. I am grateful to the noble Earl for his agreement to withdraw the measure and look forward to the assurances from my noble friend that he expects.

Lord McNair: As I indicated during my brief remarks at Second Reading, the Bill has the support of these Benches. I am sure that the suggestion made by the noble Earl, Lord Attlee, that this provision can be achieved by means of ministerial guidelines is the best one. I therefore look forward to the Minister's reply.

Baroness Farrington of Ribbleton: I should like to begin with a few general words on this Bill, which will allow local authorities--where they choose--to investigate and promote methods of minimising the amounts of waste generated within their areas. I thank my noble friend Lord Hardy for taking it forward.

As I have said before, this is a good Bill and a timely one. In the past, local authorities have tended to treat the amount of waste produced as something over which they have no control, and which they simply have to manage. We have not been getting the waste minimisation message across as successfully as we need to. This Bill starts to address that problem--not least by removing the uncertainty about whether authorities can undertake waste minimisation activities. It will allow local authorities, for example, to inform householders about some of the straightforward actions that they can take to prevent waste, such as stopping junk mail.

The noble Earl, Lord Attlee, has proposed that the Bill should require local authorities to consult principal generators of controlled waste before undertaking any waste minimisation activities. I am delighted to be able to give the noble Earl the assurance he seeks. The Government recognise the importance of appropriate consultation and, through guidance, would encourage and expect a local authority to consult interested parties. However, we would want consultation to be appropriate to the type of action planned by an authority. For example, it would not be sensible for an authority to consult every business in its area about a leaflet to be sent only to householders. Such a consultation would cost more in time and effort than the proposal itself and would deter authorities from undertaking the simple measures that we wish to encourage.

Furthermore, the Environmental Protection Act 1990, which the Bill seeks to amend, places no statutory requirement on local authorities to consult businesses or other organisations before reaching decisions on their waste management responsibilities. Any such requirement in the Waste Minimisation Bill would therefore place a stricter and additional onus on

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authorities than does the parent legislation itself. This would be illogical and inconsistent and we do not believe that it is right.

I hope that in the light of the assurances that I am only too pleased to be able to give, the noble Earl will feel able to withdraw his amendment.

Baroness Miller of Chilthorne Domer: The noble Baroness mentioned of guidelines. I believe that the Bill will work very well in areas which have unitary authorities, but much of the country is served by a waste collection authority being the district council and a waste disposal authority being the county council. In some areas where partnerships have been developed, the two authorities have worked well together. I support the proposal that businesses and others should be consulted, but I fear that where partnerships are not working well, consultation first by the collection authority and then by the disposal authority could make the effect of such consultation and the kind of work the Bill envisages rather weaker. I hope that the noble Baroness will be able to give some assurance that guidelines could include such matters as suggesting that the new development agency for local government should look at the question of authorities working in partnership and at how to improve matters where partnerships do not exist.

Perhaps I may ask that, as a long-term measure, the Government should look again at the financial consequences of having one authority responsible for collection and one for disposal. That does not make for a coherent picture and makes worthy measures such as those provided for in the Bill much harder to put into effective practice.

Baroness Farrington of Ribbleton: The noble Baroness, Lady Miller, has rightly identified an issue. There is a requirement in the Bill for the relevant authorities to consult other authorities in the area. It is my experience that the pattern of co-operation is growing in those areas where two different authorities have responsibilities.

With regard to her final point about considering a possible change of functions between the two tiers, I suspect that were we to enter into that debate today it would detain your Lordships for quite a long time.

Earl Attlee: I thank noble Lords who have spoken to this short amendment. I thank the Minister for her reply and I beg leave to withdraw my amendment.

Amendment, by leave, withdrawn.

Clause 1 agreed to.

Remaining clauses agreed to.

House resumed: Bill reported without amendment; Report received.

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The Schengen Acquis: ECC Report

11.16 a.m.

Lord Wallace of Saltaire rose to move, That this House takes note of the Report of the European Communities Committee on Incorporating the Schengen Acquis into the European Union (31st Report, HL Paper 139).

The noble Lord said: My Lords, noble Lords will have noted that this report is linked with another report from the House of Lords European Communities Committee on Europol: Third Country Rules, which the noble and learned Lord, Lord Hoffmann, will introduce following my own speech. The reason for linking the two will, I hope, become clear in the debate. We are talking of a very wide area of European Union co-operation, which has been developing over the past 10 years and which has not received much scrutiny, either within the European Parliament or within national parliaments.

It is important to underline how much activity within the European Union now takes place in the area of justice and home affairs. When the noble Lord, Lord Kingsland, and I were in Brussels on committee business last July we were told that over a third of the current meetings which the Council Secretariat services and over 40 per cent. of the paper which it circulates is concerned with justice and home affairs. This is not a small area; it is one that has grown up for obvious and important reasons. As people increasingly move across frontiers, with the enormous explosion of movement between this country and others within Europe, across all the internal frontiers of the Community, illegal activities as well as legal activities grow. Crime ceases to become a domestic concern and increasingly becomes one on which police forces, prosecution authorities, intelligence services and others need to exchange information and to co-operate internationally. If the criminals move on a cross-frontier basis, so must the forces of law and order.

The report to be presented by the noble and learned Lord, Lord Hoffmann, goes further and discusses the increasing need for Europol to co-operate with other forces of law and order outside the European Union.

The linkage between the coverage of Sub-Committee E's report and that of my own sub-committee, Sub-Committee F, is clear from the two reports. Indeed, Sub-Committee E's report states in paragraph 14:


    "it certainly seems logical to us that Europol should have links with systems such as the Schengen Information System for practical reasons to avoid duplication".

One of the large questions with which my sub-committee is currently grappling is that of the extent to which the British Government, as a government who intend to opt out of much of Schengen, will have access to such bodies as the Schengen information system. The report on Europol states at paragraph 87,


    "There are, as the Minister pointed out, major differences between the content of third country agreements under the First Pillar and the sort of agreements envisaged by the Third Country Rules".
Part of the purpose of our inquiry was precisely to look at the allocation of agreements drawn up by the Schengen countries between the first pillar and the third

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pillar. Perhaps I should explain to some of your Lordships that the Schengen agreement was signed in 1985 between five member states of the European Union, the three Benelux countries, France and Germany. It was the extension of a bilateral agreement between France and Germany to remove frontier controls to link with the common travel area already agreed within Benelux.

Five years later in 1990 there was a further Schengen implementing agreement and around that there has grown up a substantial body of decisions and executive committee declarations which is commonly known as the Schengen Acquis. It was agreed at the Amsterdam intergovernmental conference--this House has now ratified the Amsterdam Treaty--that the Schengen Acquis would be incorporated into the treaty of European Union and that the Schengen Acquis would be allocated partly to the first pillar and partly to the third pillar. The difference between the two is extremely important. Once issues are allocated to the first pillar the European Court of Justice has clear jurisdiction and the European Parliament has clear rights of consultation. In the third pillar, however, intergovernmental rules apply and the extent to which the European Court of Justice has jurisdiction, even on a consultative basis, is a great deal less clear.

Your Lordships' committee therefore set to work to examine what the Schengen Acquis was and what approach the British Government would take. We met during the course of the British presidency and were indeed assured last January by a British official who was Chair of the relevant committee that the Schengen Acquis would be agreed within three or four weeks. The situation has been much less clear than that. In the Government's reply to our report I note that paragraph 10 states,


    "it would therefore appear premature to publish a series of texts purporting to form the Schengen acquis".
We still therefore do not have a clear, agreed and published form of the Schengen Acquis. Some of the strong language in our report relates to the sheer difficulties we had in establishing what it was that we were supposed to study and what it was that Her Majesty's Government and other governments had agreed to at Amsterdam. Many of us were extremely unhappy. This is a criticism not simply of the British Government but also of other governments, and in particular the Dutch Government in their role as Community president at the time, in pushing through an agreement which committed all member governments of the European Union to incorporate into the treaty something which was not yet fully agreed.

We referred in our report to the sheer impenetrability of the texts. The draft Acquis which we obtained a copy of consisted of a number of texts in English and in French, a number of documents stating that they were confidential and that this was the title, and, as noble Lords will see from our report, long columns of numbers referring to reports which were not yet released to the public. This House is committed to the principles of transparency and democratic accountability in European integration. The report therefore states that we faced a major setback in applying principles of transparency and

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democratic accountability. This is clearly something which this House and our committee will wish to continue to study. We note, at paragraph 171, the Minister's statement that,


    "there are 'issues of principle' which determine whether an issue should be dealt with in the First or Third Pillar",
but we were unable to establish exactly what those issues of principle were. When we understand further that the British Government have achieved an opt out from the Schengen agreement in the Amsterdam Treaty, but retain the right to opt into a number of decisions at a later stage, this House will need to know the principles on which the Government will wish to opt in and opt out.

Yesterday I was in Oslo talking to a number of Norwegians, who, incidentally, are not members of the European Union, but intend to opt in to the Schengen convention. This is therefore an extremely complex set of arrangements. As regards discussions of Schengen once the Amsterdam Treaty is ratified, that will no longer take place within Schengen working groups but within Council working groups which British representatives will attend. However, they will not necessarily have any votes. The question of whether or not Norwegian and Icelandic representatives as non-members will attend remains to be agreed. This is therefore an area of extreme importance to those of us who care about civil liberties, democratic accountability and judicial responsibility, but it is also an area of considerable non-transparency. The way in which the information has been presented to this House and indeed to other governments has been inadequate. Indeed we argue in paragraph 180 that,


    "It is by no means clear to the Committee that Governments (let alone Parliaments or European citizens) understand the implications of the incorporation of the acquis".

We recognise how important it is that European governments should co-ordinate more closely their anti-criminal activities. We also recognise that this is an area which requires careful safeguards. In the action plan, which I understand will be presented to the December European Council for Justice and Home Affairs, there is a statement that,


    "Action in justice and home affairs offers new opportunities to tackle an area of major public concern and thus to bring the European Union closer to the people".
It seems to me, on the contrary, that much of what is going on here in some ways takes the European Union further away from the people. If Members of your Lordships' House, struggling hard in successive meetings of a committee, cannot understand the texts, most ordinary people will find it far more difficult. I pay tribute on this occasion to the legal assistant to our sub-committee, Leigh Gibson, who worked extremely hard to decipher the complexity of some of these texts and produced a much more helpful interpretation of the implications of the Schengen Acquis than we have managed to receive so far from the Home Office. I also wish to thank a number of outside bodies, Justice, The Immigration Law Practitioners' Association and State Watch, for the help that they gave us in this difficult task.

I worry that we in this country have become accustomed to a pattern of active international co-operation among the forces which enforce law and

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order which is not yet public. I can foresee at the first major scandal the kind of tabloid newspaper campaign which might then develop about how much had been going on behind closed doors without people understanding what was happening. Therefore one of our messages to the Government is that it is in the Government's interests to publish a great deal more of what is now happening and how far we have entered into different commitments, what the international activities of our national criminal intelligence services now involve and what our commitments to Europol unavoidably involve, just to make sure that when the first major scandal occurs--whatever that may be--the Government will be able to say they had done their best to make sure that they carried the public with them. The danger of backlash is clearly there.

Having said that, I shall be brief about our further recommendations. It is the intention of our sub-committee to continue to look at a number of items which carry on from this, in particular the justification for opting in to part of the Schengen system and opting out of others, which is justified in particular by what the Government in their reply to the report called:


    "The unique immigration control requirements of the UK (and Ireland)".
I think that the brackets are intended to imply that the Irish do not necessarily agree with this statement; but the Government would like them to do so, even if they do not. It also argues that the Government will participate in first pillar activities on immigration and asylum,


    "where it is in the national interest to do so".
We need to know rather more clearly than we have been informed so far what the national interest is in that extremely complex area.

What we therefore face is a deeply unsatisfactory situation in a very important area. The European Union is now committed to the establishment of an area of freedom, security and justice. That is a worthy and necessary commitment, given how far trans-border activities extend across Europe and beyond. But it requires a delicate balance between freedom and security. The two do not easily sit together and governments, and, even more, parliaments, have to be sure that we make the right assessment of what the balance should be.

We have also touched in the report on the need for legal certainty. One needs to be entirely sure, as one allocates different functions between the first pillar and the third pillar, that one can discover clearly under what particular rule each action has been taken. My noble friend Lord Lester, who unfortunately cannot be here today, said at one point that he had divided views on this subject. He thought that the absence of legal certainty implied in the Schengen Acquis would keep him profitably employed for many years to come, but as a Member of your Lordships' House he felt that legal certainty was nevertheless an important principle.

In commending the report to the House, I wish to underline that this is an extremely important issue. It is not yet one which the newspapers or the other place

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have taken fully on board. It is now one of the major areas of European Union co-operation. It is therefore something which requires rather more public and parliamentary attention both here and elsewhere. I commend the Motion to the House.

Moved, That this House takes note of the Report of the European Communities Committee on Incorporating the Schengen Acquis into the European Union (31st Report, HL Paper 139).--(Lord Wallace of Saltaire.)

11.32 a.m.

Lord Hoffmann: My Lords, my noble friend Lord Wallace of Saltaire has very clearly set the context of the report of your Lordships' Select Committee on the Europol Third Country Rules. In fact, your Lordships might regard this report as a specific example of the more general themes which my noble friend developed.

The Europol third country rules sound a rather dry and forbidding subject. In some respects they are. Anyone who has tried to sit down and read the rules in Appendix 3 to the report has my sympathy. But the report does, I think, raise two questions of general interest and importance. One is a general problem of law enforcement which happens here to arise in a European context; namely, how one strikes a balance between effective policing and the protection of human rights. The other, and possibly even more important question, is specific to the functioning of the European Community and concerns the exercise of democratic control over the way in which the European institutions answer the first question--that is, how the balance is to be struck.

Let me first explain what I have called the first question. The lifeblood of effective policing is good intelligence. In the United Kingdom we have an organisation called the National Criminal Intelligence Service which collects and analyses intelligence for the use of police forces throughout the country. But criminals operate across national frontiers and it is therefore essential, particularly for activities like drug dealing, terrorism, illegal immigration and money laundering, to have arrangements to exchange intelligence with police forces in other countries.

European co-operation in the context of the European Union began in this area with the Europol Drugs Unit, which was set up in The Hague in 1993 to exchange information on drug dealing. Its mandate has been extended to other crimes and in 1994 the member states signed a convention to set up Europol, an organisation through which police forces would exchange liaison officers and which would also maintain a central data bank of information.

Where will this information come from and to whom will it be provided? In the first instance, of course, the member states themselves. But the convention also provides that Europol will enter into agreements for the exchange of information with other states outside the European Union and with bodies like Interpol, to which 177 countries belong. Again, such exchanges are obviously necessary. Criminals do not stop at the borders of the European Union. A lot of criminality

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comes in from the East, from Russia and the countries on the western borders of the Union. There are criminal links with the United States and South America. In principle, therefore, exchanges of information with third countries are to be encouraged and the Europol Convention, on which your Lordships' Select Committee reported in 1995, expressly provided for such exchanges.

On the other hand, your Lordships will see at once that such exchanges of information involve an element of risk to individual citizens both within the Union and abroad. What will the foreign state do with the information which Europol provides? If it is given the name of someone associated with a person suspected of crime, will it then torture him to obtain further information? Will it use the information only for the purposes of criminal investigation, or will it put it to some other, perhaps political purpose? Will it make disclosures which would be an unfair invasion of someone's privacy? What about the information which Europol receives in return? What will be known about the way in which it was obtained and how reliable it is?

If a system of exchanging information is not to result in invasion of privacy and in accusations of violations of human rights, one needs careful safeguards. A balance has to be struck between protecting the rights of the individual and making the exchange of information between police forces as easy as possible. The question of how that balance should be struck is a difficult one on which reasonable people can hold different views. I suggest to your Lordships that it is essentially a matter for democratic decision by the representatives of the people of the member states.

The Europol Convention itself contains nothing about the detailed safeguards which would be applied to these exchanges of police intelligence with third states and bodies. They were left to be included in rules to be agreed later among the member states. When your Lordships' Select Committee reported on the convention in 1995, it said that the terms of these rules would be important. It is in the detail of that kind that the real matter lies.

However, in February of this year the Home Office provided the committee with the rules, which for some reason had been divided into four different sets, and said that three had already been agreed and one was about to be agreed shortly. When the chairman of the Select Committee asked why they had not been deposited for scrutiny in the usual way in advance of being agreed, the Home Office Minister said that they did not appear to the department to be of major significance.

This little episode raises the second question about democratic control. I have no doubt that the Minister acted in good faith and honestly thought that it was not worth bothering us with these rather technical rules. I believe that that was a mistake. As the rules are the main protection of ordinary citizens of member states from abuses of their human rights by the information-gathering and distribution functions of Europol I should have thought that they were peculiarly a matter for scrutiny by Parliament. I fear that this is not the only example of legislation under the third justice

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and home affairs pillar of the European Union that is being agreed to by governments in the Council without any opportunity for consideration by the elected--or even the unelected--representatives of the people.

I say no more about the second question and return to the first. Do the draft rules provide sufficient protection? Mr. Abbott, the Director General of the National Criminal Intelligence Service--an engaging policeman who gave the impression that he knew far more about a lot of things than he could tell us--thought that they had got it about right and there were sufficient checks and balances. One might think that he would say that, wouldn't he? But the Data Protection Registrar, Mrs. France, was broadly satisfied. The activities of Europol will be overseen by a joint supervisory board with representatives from all member states, and Mrs. France will probably be ours. Her attitude and that of other witnesses, including those from the Home Office, was that in this field one should not be too prescriptive and detailed in advance. Practical experience would show how it was working and whether tighter safeguards were needed.

On the other hand, organisations such as Justice put less trust in policemen, the supervisory board and others who run the show. They wanted the rules to be more strictly drawn. Perhaps I may give a specific example. As soon as information is received from a third country in circumstances that give rise to suspicion that it has been obtained by torture or other illegal means, can Europol cheerfully store it on its database and distribute it to member states? Article 4(4) of the relevant rules states that Europol should not store information in its files where it has,


    "clearly been obtained by a third state in obvious violation of human rights".
Consider the crushing burden of adverb and adjective in that phrase which must be surmounted. It refers to information that is "clearly" obtained in "obvious" violation of human rights. Does that not send a signal to Europol not to ask any unnecessary questions about how the information has been obtained? Can one imagine circumstances in which any careful policeman who receives the information will ever consider that it has obviously been obtained in clear breach of human rights? The Select Committee thought that this went too far in protecting Europol officials against criticism for accepting tainted information.

Then there is the question of what control one can have over the use that third parties make of the information sent to them by Europol. At present the rules say that information can be sent only to countries with which Europol has an agreement. There is an exception for emergencies where the director general has a discretion, but I shall not go into that. Such an agreement with a particular country for the sending of information requires the consent of all member states on the Council. The rules say that they must take into account the data protection rules and practices of that third state. That is all. There is no prescribed minimum standard of data protection that the third state must have and no mention of it not using that information in ways that would contravene human rights.

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The Government say that the safeguard lies in the requirement for unanimous consent to an agreement with any particular country and that they will not enter into agreements with countries that they believe cannot be trusted. Therefore, the position is that we must trust our governments to decide which other governments can be trusted. Perhaps there is no alternative, at any rate not until Europol has been up and running for some time and we can see how it is working. But it is well that people should know how large an element of trust is involved in these arrangements.

It may well be that, in the larger scheme of things, the passage of these rules is a minor item in what the jargon calls the democratic deficit of the European Union. But I believe it is a clear illustration of the more general problem that the noble Lord, Lord Wallace of Saltaire, explained and that, in principle, the question of whether the rules governing police activity contain, as Mr. Abbott was satisfied, sufficient checks and balances should not be decided solely in the conclaves of our political masters.

11.45 p.m.

Lord Borrie: My Lords, I am particularly glad to follow the noble and learned Lord, Lord Hoffmann, because his involvement in this matter brings to an end three years of his chairmanship of Sub-Committee E. He has been an excellent chairman during the whole period. His successor is the noble and learned Lord, Lord Hope of Craighead. One example of the noble and learned Lord's excellent chairmanship was his ability to get the best out of the witnesses, some of whom--he referred to one during the course of his speech--were inclined to give rather less evidence than the sub-committee wanted to get out of them.

In principle information that may help to prevent or punish serious international crime, whether it is drug-trafficking, sex offences, money-laundering or terrorism, should be made as freely available as possible between one police authority and another and between such bodies as Interpol and Europol across the frontiers of the world. It is wholly desirable that Europol, which was set up in 1995, should be enabled to make agreements both within and without the European Union to facilitate the ongoing battle against sophisticated, professional international crime. It is the purpose of the Third Country Rules to give Europol such powers and to enable it to give and receive information irrespective of agreements.

As the noble and learned Lord, Lord Hoffmann, explained, there is a balance. It is absolutely vital that information that is given and received by Europol is reliable. It may not be reliable if, for example, it has been obtained by physical torture or psychological pressure. Police methods are not at all times or universally models of propriety, even those in this country of which normally we are so proud. In some countries evidence and information may sometimes routinely be obtained in violation of basic human rights. Quite apart from the question of reliability, the

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observance of human rights, minimum standards of privacy and minimum standards of data protection are principles that should be maintained for their own sake.

The noble and learned Lord dealt comprehensively with how, in the report on the Third Country Rules, we wish to try to establish more clearly the balance and remove some of the fuzzy areas of which he gave examples.

I need not go over the same area covered by the noble and learned Lord. I found it most helpful in the course of our inquiry to have evidence, both oral and written, from the Data Protection Registrar, Mrs. Elizabeth France, who is likely to have an important ongoing role as a member of the joint supervisory board which will monitor what Europol is doing and also monitor communications to Europol of personal data. It was also helpful to have the written and oral evidence of the organisation, Justice. Lawyers, reasonably, are criticised in this House and another place on an almost routine basis. However, it is fair to point out that that organisation, which largely comprises lawyers, can be extremely useful in being vigilant and assiduous in studying the details of rules and procedures whether emerging from Brussels or from Whitehall. I am a lawyer and I have been a member of Justice since its foundation 40 years ago. Although that is an interest, it is one of which I am exceedingly proud. I thought that its evidence was immensely thorough and helpful on the matter we are discussing today.

11.50 a.m.

Lord Cockfield: My Lords, I propose to talk about Schengen, about which I know something, and will not refer to Europol about which, I am glad to say, I know nothing. That is not a distinction invariably followed in your Lordships' House. Perhaps I may be forgiven if, on this occasion, I try to follow it.

The report by your Lordships' Select Committee on Schengen is important, interesting and fascinating. But it does not deal with what I regard as one of the most important issues which flows from the report. I do not say that in any sense of criticism either of the report or the Select Committee. It was not asked to deal with this matter and if it had done so no doubt it would have been criticised for having gone outside its terms of reference. When I refer to the issue, I do so because it is of great importance.

I wish to start by saying something about the origins of the Schengen system. It is a more complicated story than appears in the Select Committee's report. Again, that is not a criticism because it was not asked to write an historical treatise. Nevertheless, it is important to the point of view that I propose to put forward. It was touched on peripherally by the noble Lord, Lord Wallace of Saltaire.

The concept of abolishing obstacles to the freedom of movement of people as well as of goods, services and capital was part and parcel of the original Treaty of Rome in 1957. It was very much part of the whole Community programme. At the time it was thought that once one had firmly established the customs union and had got rid of internal customs duties, the frontiers

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would disappear with one or two other minor measures. However, when the customs union was completed in 1967, it was found that there were many other barriers to the freedom of movement of goods, services, capital and people. A programme was embarked upon to deal with those other obstacles.

Following enlargement of the Community in 1973 with the accession of the United Kingdom, Denmark and Ireland, progress came to a halt. That was not entirely the fault of the United Kingdom. It was due also to the two oil-induced recessions in the late 1970s. But as we moved into the 1980s and Europe began to come out of the recession, the concept of completing the unfinished business of the Treaty of Rome, as it was described, became a major issue. Perhaps the most important manifestation of that was the single market programme approved by the heads of government in June 1985, by accident almost exactly when the original Schengen agreements were signed.

The Schengen agreements emerged as a result of the conclusions reached by the meeting of the heads of state at Fontainebleau in June 1984 when they launched a programme to create what they called the people's Europe. We saw exactly the same concept re-emerging at the time of Maastricht, except that by then it was described as the citizen's Europe. It is interesting to consider the enormous range of issues which it was felt at Fontainebleau came under the heading of the people's Europe. In addition to,


    "The abolition of all police and customs formalities for people"--
let us note the word "people"--


    "crossing intra-Community frontiers",
the meeting dealt with university diplomas, a flag and anthem, European sports teams, minting of a European coinage, national committees of European volunteers to work on development projects in the third world, drug abuse and twinning of children's classes. I hope that I have given your Lordships an idea of the width of the initiative that the heads of government wanted to take. All of that came under the aegis of a new committee which emerged under the name of the Adonnino Committee. That was the beginning of the Schengen process.

There was a meeting of a small number of heads of government. There is nothing unusual about that. Heads of government who felt that they had a common interest would meet together outside the usual structures of the Community. There would be meetings of the heads of socialist governments; meetings of the heads of centre-right governments. This was a meeting of five heads of government having a particular interest in the issue. The three Benelux countries, the Netherlands, Belgium and Luxembourg, which were joined together before the European Community started in what was known as the Benelux Union, France, and Germany all had more or less common frontiers. Those countries came together in a geographical knot, as we might describe it, which was not far from Schengen. Schengen is close to the confluence of the Moselle and the Rhine.

The meeting of the heads of government of those five countries took place on a barge moored on the river close to Schengen. The proceedings were greatly

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assisted by large quantities of the finest French champagne provided by the French Government--a rather continental way of proceeding of which we do not see much in this country. That is perhaps why more progress tends to be made on the Continent than in this country. The Schengen agreement was set up.

In parallel with that, and in the same month, there was endorsement by the heads of government of the programme for the completion of the internal market--the single market, as we now call it--which also included measures for dealing with the removal of internal barriers, frontiers and obstacles to the freedom of movement of individuals. At the time the Schengen agreement was signed there were serious reservations in the Commission as to whether the action might be illegal, being contrary to the provisions of the treaty.

We see that kind of reaction today with the initiative by Mr. Neil Kinnock in relation to the open skies agreement, but let me not go into that. At the time I had direct responsibility for the single market and I took the view that I should prefer to see progress even if it were of doubtful legality rather than see no progress in a perfectly legal way. At the end of the day, not entirely because of my own advocacy but because there were too many other problems to deal with, that view was accepted inside the Commission. Therefore, the Schengen system grew up outside, but in parallel with, the Community and progress in the Community inter alia the single market. Now we see one of the results of operation outside the Community and outside the Community system.

The hallmark of the Community system and the way in which it proceeds is as follows. One starts with a legal base; in other words, there must be a provision in the treaties which justifies the field in which one proposes taking action. One must then have a proposal by the Commission. That goes to the Council of Ministers and, if appropriate, to the European Parliament. If adopted, as it usually is, in a much watered-down form, it becomes Community law. However, it is important to realise that a directive, for example, is only a directive to the member states that they shall legislate on a particular subject in a particular way. Therefore, the adoption of a directive is followed by legislation in the individual member states. Finally, the Court of Justice decides whether or not the whole thing complies with the law; whether the member states have complied with the law; and whether the member states have carried out the duties which were legally incumbent upon them. The result is that one has transparency, clarity, certainty and judicial review.

That is the Community system. If you operate outside the Community this document is what you end up with. That is the most important lesson which, in my view, emerges from the very commendable work of your Lordships' Select Committee.

I wish to emphasise one additional point. I am talking about action which falls within the ambit of the treaties. I am not talking about issues such as foreign affairs, which grew up completely outside the treaties, had no legal base and were referred to originally as political co-operation, which meant Foreign Ministers quarrelling

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with one another. All of that is a totally different issue. The justice and home affairs aspect is perhaps just crossing the border. The Schengen approach is the only one adopted outside the Community system over a period of very many years--fortunately.

The Community has always been haunted by the risk of breakdown into two or more groups: those countries which wish to proceed more rapidly; those countries which wish to proceed more slowly; and the one or two countries which do not wish to proceed at all. We had all kinds of vague phraseology--"different speeds", "concentric circles" and so forth--to illustrate those views. But nothing ever came of it. At the end of the day, the issues were always solved by compromise, by derogation in one or two cases, and by opt-outs, so that, broadly, the whole Community went ahead together.

Maastricht was a messy compromise between the people who wanted to make progress and the people who did not, with the creation of a three pillar structure and the idea of what was called "enhanced co-operation", subsequently watered down to "closer collaboration." It was thought that the word "enhanced" indicated something rather better than merely "closer." If one turns to the Amsterdam Treaty one finds that the "enhanced co-operation" is very, very firmly linked to the Community and the Community system. In other words, it is the first pillar and not the second or third.

If this is carried forward it is an advance of critical and very great importance. Therefore, all I wish to say in summary is that the Schengen agreements were important because they shifted people forward. However, at the same time, the method used created the kind of morass which your Lordships' Select Committee has had enormous difficulties in tidying up and bringing within the Community competence. I hope very much--and it is a hope rather than a conclusion--that the lesson will have been learnt, that we never again get ourselves into the quagmire illustrated by the Schengen agreement, and that we try and proceed, if we wish to do so, down the road of closer co-operation under the umbrella of the Community or what is now described as "the first pillar."

12.6 p.m.

Baroness Ludford: My Lords, I am grateful to have the opportunity to speak in this debate on a serious and important subject. The issue of co-operation on what could broadly be called "home affairs" is extremely important. The aspects highlighted in the two reports are complicated and technical. I am extremely grateful to the European Communities Select Committee for the thorough work that it has done. I am not usually in favour of too much self-congratulation in this House, but in the area of parliamentary scrutiny of European developments, it is second to none.

I shall refer mainly to the 31st report on the Schengen Acquis. I know that my noble friend Lady Nicholson of Winterbourne will speak in particular on the report on Europol and data protection.

On the face of it, the subject matter covered is not one that is ripe for comedy. However, I am afraid that at points I was overcome by a temptation to giggle when

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reading some of the "Kafkaesque" scenarios sketched in the report. When preparing for the debate, I happened to read in a newspaper that satire is making a comeback. There is to be a new television programme starring the comedian Harry Enfield as the reverend A.R.P. Blair in "A sermon from St. Albion's", a televised version of the Private Eye column. We should suggest to Ian Hislop, the editor of Private Eye and of the programme, that he trawls the report for material because the nature of the subject matter lends itself well.

I refer to paragraph 101 of the recommendations. It states


    "The Committee considers the presentation of the draft Decisions and accompanying Explanatory Memorandum inadequate. Columns of numbers listed without descriptions or explanations are as unhelpful a way of providing information as we can think of. In order to make any sense of the draft Decisions as presented to Parliament it is necessary to have open the Decisions themselves, the EC Treaty, the Treaty on European Union, the Schengen Protocol and the Schengen Convention".

One cannot help fantasising about possible sketches with the Prime Minister and the Home Secretary poring over those assembled texts as they discuss the finer points of the Schengen Acquis. I hope that a comedian will take up that suggestion.

I am afraid that there are other aspects which invite parody. Paragraph 120 particularly caught my eye. It states:


    "All or part of seven Executive Committee decisions",
that is the executive committee of the Schengen agreement,


    "(some of which the Home Office has not received) are currently classified as confidential".
I translate that to mean that the Home Office does not know what it does not know or what it must keep confidential, not only from the public but also from Parliament.

The committee tries to establish what the confidential documents are and it lists those that it has discovered but is forced to conclude that there may be others of which it is not aware. I cannot resist finding that amusing.

On the other hand, the committee points out--and if I am not mistaken, the courtesy of the language conveys a fairly powerful sense of anger--that:


    "It is possible that the Schengen Acquis may be brought into force before a definitive list of what it contains has been established. This committee does not yet have a clear picture of what is in the Acquis or what it will mean".
One is not surprised that it declares itself astonished. That is a shameful state of affairs.

I have clearly missed my vocation. I could have perhaps become a rich woman by dreaming up "Yes Prime Minister" type sketches where Alistair Campbell briefs the PM before a press conference: "Now, Prime Minister, this measure is coming into force next week. I cannot tell you what it contains and what it means. If you are asked to say what advice you would give a constituent at your MP's surgery, you must pass. Tell the journalist that there may be other confidential information of which you are not yet aware but you are

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sure that the officials in the Home Office can be relied on to act in the interests of openness, transparency and civil liberties".

One cannot quarrel with the forceful final recommendation of the committee at paragraph 168. I am sorry to keep quoting, but they are important conclusions. That paragraph states:


    "We find this fact",
the fact that the acquis will enter into force with the Amsterdam Treaty before we know what is in it,


    "hard to reconcile with the need to bring the Union closer to the people".
That is a conclusion which was brought out in particular at the Cardiff European Council in June when it was said that,


    "a sustained effort is needed by the Member States and all the institutions to bring the Union closer to people by making it more open, more understandable and more relevant to daily life".
The committee has provided a very valuable service in drawing our attention to the fact that those aspirations are mere empty rhetoric if the state of affairs which has been sketched in the report continues.

The Amsterdam Treaty represented an important advance for the European Union in the field of civil liberties, democracy and transparency. There had been a sense of failure that the third pillar on co-operation, justice and home affairs was inadequate and that the provisions on freedom of movement of people lag far behind those in relation to services, goods and capital, as the noble Lord, Lord Cockfield, has so graphically described.

Therefore, the changes made at Amsterdam were significant. They transplanted visas, asylum and immigration from the third pillar into the first so that they are subject to European Community procedures. The Schengen agreement was brought within the purview of the Union. It made respect for human rights an explicit criterion for full membership of the Union. It also made strides in anti-discrimination provisions. Those advances were very real.

However, there are two main areas of concern on which I wish to concentrate in my last few minutes: the lack of democracy and the rule of law on the one hand, and the practical implications of the British opt-out on the other. Those two areas have a significant impact and represent a gap between the advances of Amsterdam and what is still to be done.

I shall not repeat what others have said in the debate because there is nothing with which I disagreed and everything with which I agreed as regards how what we have at the moment represents bureaucratic Europe and not a democratic Europe. I do not believe that there can be a people's Europe when there is a lack of full parliamentary and judicial oversight. I prefer the phrase "citizen's Europe" to "people's Europe" because it puts the stress on those aspects. I do rather part company with the Government in that regard. They talk about tackling crime. They are quite right to do so because it is one matter which is extremely important to people. But so is the protection of civil liberties and the clarity and transparency which comes from knowing that there

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are parliamentary and judicial safeguards. Therefore, I should welcome some assurances from the Government as to their future intentions in that regard.

The noble and learned Lord, Lord Hoffmann, referred to evidence from the police officer which basically amounted to "trust me" in looking after civil liberties. I am afraid that the Minister, Joyce Quin MP, in her evidence to the committee took a similar attitude about the secrecy of matters in the Council. She said:


    ""from my own experience of attending Council meetings and discussing these issues under the umbrella of the Third Pillar, I have been struck by the fact that, rather than seeming to want to be secretive, members of the Council very frequently stress the importance of such areas as data protection, of respect for human rights, of transparency and of openness".
With the greatest respect, I am not prepared to take that on trust. I want guarantees of openness and transparency.

The second area to which I wish to refer is the practical impact on British citizens and residents of the opt-out which the British Government secured from Title IV of the European Community treaty. Personally, I regard the removal of border controls on myself as a British citizen as a rather high priority. I am rather allergic to being stopped at frontiers and having to show my passport. As my noble friend Lord Wallace said, that is an area where one needs great safeguards and one cannot be cavalier, but I wish this country and its citizens to be included in working for the removal of internal border controls with appropriate safeguards.

I do not believe that many terrorists are caught at borders. If that were the case, we should not have maintained the common travel area with Ireland and we should not have to go looking for criminals at the Costa del Sol.

The second area of concern which has a practical impact on British citizens is in relation to those people who have rights of residence in Britain but are not British citizens. They are third country nationals. Unfortunately, the word used in the treaty is "aliens" but they are very welcome residents among us who happen not to have taken British citizenship. They are usually from ethnic minorities. I am concerned that such people who have a right to residence in this country but do not have a British passport have to get a visa to go on holiday, for instance, to France. I have come across some cases of this. As I understand it, those people will not get the advantage of future developments in this area because of our opt-out in common rights of travel throughout the European Union.

I also believe that this country will be prejudiced by not joining in on the common asylum and immigration rules. I hear the point made by the Government that because of our geography and history our interests in these matters do not converge with those of continental countries, but I would have thought that the advantages outweighed the disadvantages in the current world situation of pressures for people to seek asylum. I think that we ought to be included in common European rules.

Finally, I welcome the fact that the Amsterdam Treaty has a provision which will be built on to enable, among other things, the European Community to develop rules against racial discrimination. As I understand it, if those

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rules are developed we would not have the advantage of their being applied in this area of Title IV of the treaty, because we would have opted out. I think that is a disbenefit for people who live in this country.

I will end where I began. I am profoundly grateful to this committee for its work, but profoundly disturbed at its findings and unhappy, I have to say, about the inadequate stance of the Government so far. I am frankly puzzled why this reforming Government, who have made a great deal of progress in many areas, should follow the Conservative administration so closely in its refusal to bring the light of parliamentary and judicial scrutiny to this area. The Government appear to be satisfied with an opt-out when, with appropriate safeguards, I believe it would be in the interests of this country to be included in the rules which apply throughout the Union.

12.21 p.m.

Lord Bruce of Donington: My Lords, it is a very great pleasure to me to follow the noble Baroness, Lady Ludford, in the, if I may say so, excellent speech which she has just delivered. There is nothing like a little humour every now and again to puncture some of the more common pomposities with which administrations, and indeed others, occasionally adorn themselves. I must say that I agreed with a very great amount of what she said. I should like also to congratulate the noble Lord, Lord Wallace of Saltaire, and the noble and learned Lord, Lord Hoffmann, on their speeches and indeed on the reports which have come from their respective sub-committees.

These deal with matters that do not necessarily make sensational headlines on Saturday evening, Friday evening or any other evening, but they are important nonetheless. At a time when the composition of the House of Lords and some of its functions are coming under what I believe is called "close review" or "detailed consideration", it might perhaps be said that the ability of this House to combine the activities of two of its sub-committees of the European Community's committee could not be more timely, because it is so obviously appropriate.

On the one hand, the report put out by Sub-Committee F deals with a problem that was likely to arise in its more acute form the moment the reunification of Germany took place. Indeed, as the noble Lord, Lord Cockfield, said, the establishment of the single market and various associated matters did imply and demand that there had to be greater freedom of movement in the Community generally, if only to stimulate trade, to improve intellectual exchanges of various kinds in the artistic and educational fields and for other reasons.

Since the reunification of Germany and the economic events in Germany itself which have resulted in the repatriation of a large number of Turkish citizens, these matters have become of some importance in their own right. This has been accentuated to some extent in more recent months by the extraordinary events that have taken place in the Soviet Union. So there can be no difficulty in providing complete justification to

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Sub-Committee F for having gone into the matter in the detailed way that it has. Similarly of course, with the growth of criminality, particularly in the drugs and money laundering fields, attention has been focused upon the very necessary co-operation on criminal intelligence throughout Europe, and indeed beyond, by arrangements within the Union itself which often have to be supplemented by arrangements between countries inside the Community and those that are outside. All these are to be expected, and it must be said straight away that your Lordships' sub-committees on these matters have pursued their task with what we in other fields would call due diligence.

I should like first to refer to the deliberations of Sub-Committee F, if only to reinforce what the noble Lord, Lord Wallace, said, followed in turn by the noble Baroness, Lady Ludford. There can be no doubt about the authenticity of the indictment. Says the committee in its summary of issues addressed in the report that it has produced:


    "The Government have done their best to make the acquis available to us. Arrangements to bring the acquis into the EU were agreed a year ago. Yet a definitive version of the acquis does not exist".

Then a little later it says this:


    "Little time remains for untangling the acquis. The Committee does not yet have a clear picture of what is in the acquis, or what it will mean. Nor are we convinced that the Government has really come to grips with this issue ... For the benefit of Parliament, the Government and all European citizens, there is now a need for a clear and concise explanation of the content of the acquis and its likely implications".

There could not be a more devastating indictment than that, and if anybody ever accuses your Lordships' House of dealing purely in windy generalities, I would suggest that this report shows a frankness which is very often absent from some Committee reports which come from another place. At any rate there is a formidable case to answer, and I have no doubt that my noble friend will be able to give some indication of the reaction of the Government to such an indictment. For my own part, I am not wholly convinced that it is their fault.

It takes a very long time--and I can testify to this personally--to read such Community documents as are compatible with one another and to search for the degree of compatibility that some of them show. To this I can testify, and so I am quite sure can Her Majesty's Ministers, who, after all, may not see and are not furnished with all the documents that emanate from the Commission and from other parts of the administrative apparatus of the Community, and therefore cannot possibly cover them. But I suggest that they should be far more vigilant in relation to the documents that they ask for and receive than the matters covered by the indictment of Sub-Committee F.

That brings me to the report of Sub-Committee E. It is impossible to deal with all that it covers because it is extremely complex and, as one would expect, the interrogation of witnesses has been deep. I regret to say that the answers provided to Sub-Committee E have not always been compatible with one another.

However, I commend to your Lordships the explanation of what constitutes money laundering. For a large part of my short professional career I was

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charged with investigating alleged fraud. A good definition of "money laundering" can be found in the report at page 11 of the evidence of Mr. John Abbot, Director General of the National Criminal and Intelligence Service (NCIS). It is highly illuminating.

But even in that field we are not concerned with generalities; we are not concerned with concepts of philosophy nor even with the concept of policy; we are concerned with practicalities. Sub-Committee E was seeking to obtain something definite--I speak subject to the noble and learned Lord's correction--as to the rules that need to be in place in order to balance the interests on the one hand of the ordinary citizen and on the other of the state or states which the enforcement agencies are there to protect.

Again, there is no clear answer. Fortuitously, in this country the Court of Appeal, on 3rd November, met to consider a case which showed the differences in principle that arose from our legislation and delivered a judgment which was published in The Times on 5th November. I have no time to acquaint your Lordships with its contents but your Lordships will see the meticulous way in which our Court of Appeal sought to resolve the problem created by the frequent conflict of the two interests--the ordinary civil litigant on the one hand and the National Security Intelligence Service on the other.

I provided a copy of the judgment to the Government. In giving its judgment in the case of C v. S and Others, the court laid down eight principles upon which it ruled that courts trying this kind of case should follow. My specific question is this. I am satisfied that within the United Kingdom the judgment of the Court of Appeal--subject to anything that may happen in your Lordships' House on the legal side--will be regarded as a precedent by our courts who will be able to follow it successfully. But how far will that writ run in Europe?

These transactions take place not only between members of the United Kingdom, but also across Europe. They have to be attended to. Whose rules will apply? If a case is brought under these rules in the United Kingdom, how far will it be followed in other member states, subject to the judgment of the European Court in Luxembourg? Those are matters which must be resolved.

The Government may have their own ideas about the matter. I am persuaded that it will be necessary for the Government to make a decision as to how, in their further negotiations with the other member states--always bearing in mind the overriding power of Germany and France under the Elysee Treaty of 1963--this is to be resolved. I shall be interested in the Government's reply. In the meantime, I renew my thanks to both noble Lords and to their sub-committees.

12.35 p.m.

Baroness Elles: My Lords, I am not able to follow the noble Lord in his remarks concerning the case published in The Times yesterday. However, I hope that he finds his answers elsewhere. On the contrary, I join the noble Lord, Lord Borrie, in expressing my congratulations and gratitude to the chairman of

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Sub-Committee E, the noble and learned Lord, Lord Hoffmann. After chairing the sub-committee for three years, he is now retiring. But during that time, through an excellent scrutiny of texts and the issues arising therefrom, he concerned himself with the legal matters involving Europe.

Also, I add my gratitude to the legal adviser who was so helpful in producing the report before us today. It involved a great deal of detailed work and consideration of difficult issues which, though they perhaps did not appear important to the Home Office, are important to those who deal with legal issues and have to know where they stand with them. The legal adviser was extremely helpful.

It is important to realise that it was the insistence of the Select Committee and the noble and learned Lord, Lord Hoffmann, as our chairman, that led us to consider the Third Country Rules despite the fact that three of them had already been adopted. The value of the process of scrutiny and the possibility of discrepancies in the drafting of text--the convention came into force on 1st October, having been ratified by the 15 member states in December 1996 (the United Kingdom being the first to do so)--were emphasised, though initially the Home Office insisted that they were not important. In fact, the Minister stated:


    "We took the view that these documents fall outside the criteria for the deposit of scrutiny, as it seemed to us that they were not of major significance".
The Home Office felt that that was a fair statement. But the Select Committee disagreed. The report shows that the rules raise certain problems and it indicates possible inconsistencies between the rules and the convention.

Two issues are of concern: first, the adequacy of data protection rules; and, secondly, the risks which may arise to the individual in the unlawful obtaining and use of information. Other issues, of course, arise, but I believe those two to be worth commenting on. It was considered that rules covering data protection should be reviewed within the next two or three years to assess whether the rules should set out the basic requirements so as to secure the adequate level of protection which is lacking at the moment.

On the human rights clauses, the committee considered that there should be standard terms in agreements under Third Country Rules. Those terms could remove the difficulties which arise occasionally and which are explained in the report, such as when a third country may correct or delete passages in agreements, but Europol itself would retain such passages in order to deal with a specific matter. There is no wording in the text of the rules to explain the reasons for such conduct, or indeed the results that could arise out of that kind of conduct. Therefore, the committee recommended that human rights clauses should be included as standard in agreements under Third Country Rules.

Other issues were raised during examination by the committee, including the need for a clear statement on the equivalence of protection of individuals in relation to information required from third states and in relation to information transmitted within the EU. It is important

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to make clear that the individuals who live outside the EU should have exactly the same type of protection as that available to individuals living within the EU.

Those are just some of the issues which have arisen and which were dealt with by the report. Analysis of the rules by the committee shows that in the case of the requirement of confidentiality,


    "there is a problem of construction arising from the texts".
That analysis has also shown that, in the drafting of the rules, there were certain clauses that could have been better or more clearly expressed and which should have included issues which were omitted. There are quite a few difficulties in the texts of the rules as they were presented and which, over the coming years, will certainly need to be reviewed.

I accept that drafting texts for agreement by 15 member states, or their representatives, is not an easy or enviable task. It is hoped that there are areas, which have been the subject of criticism in the report--and indeed others which will crop up in the course of the coming months--which may be considered, and if necessary, amended when reviewed in the next two or three years.

12.42 p.m.

Lord Bridges: My Lords, as a member of the sub-committee chaired by the noble Lord, Lord Wallace, I feel that we owe the House an apology for presenting such a lengthy and dense document. I would only say that the complexity is not of our making, that unravelling the problems does take time and patience and, as the issues are so important and little understood, we felt that a thorough and detailed analysis seemed essential. However, the text is there. What emerges from all this? I suggest the following points.

First, and perhaps of most urgent importance, we draw attention to the fact that as ratification of the Treaty of Amsterdam approaches, Parliament is not yet aware of the significance of the passages in the treaty relating to Schengen. We still lack an authoritative version of the Schengen Acquis which will come into force with the treaty. As a retired practitioner in this field, it seemed to me that one of the few abiding rules of international life is that governments should not sign treaties which they do not fully understand or have consequences which are largely unpredictable. Yet that seems to be the position regarding the passages on Schengen in the Treaty of Amsterdam. That opinion is recorded in our report in paragraphs 109 and 112. I shall return to that point briefly in my conclusion with a specific request for the Minister.

Next, it is pertinent to examine, as did the noble Lord, Lord Cockfield, how the uncertainty and confusion arose in the first place. I am glad to say that my recollection of how it looked from my desk in Whitehall coincides largely with his reminiscences of the champagne-filled barge. Primarily I believe that the reason was that the authors of the original Schengen agreement wished to implement the provisions of the Treaty of Rome regarding the free movement of persons throughout the EC. They felt frustrated with the

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old-fashioned rule that passports and frontier controls persisted. They were determined to liberate citizens from that outmoded method of individual checks, and sought to do so by an accord, as the noble Lord, Lord Cockfield, has reminded us, outside the treaty framework.

For reasons that I have never understood, their partners in the Community raised no objection to that, although their action fell clearly within the responsibilities of the EC as defined in the treaty. We should note that in 1985 the UK was already a member of the EC and we were opposed to extending the active role of the Community into the areas of frontier controls. It was no doubt, at least in part, because of our opposition that the Schengen partners decided to act as they did.

I have also heard the opinion of some European jurists, that in seeking to apply the responsibilities in the Treaty of Rome regarding free movement, the Schengen partners were acting in a legitimate way. It was argued that they were helping to bring about the objective of free movement in the only way open to them.

Seen in this light, it can be understood that some of our partners now regard the passages in the Treaty of Amsterdam on free movement as necessary in order to return this subject to its proper home within the Community legal framework. That general attitude also explains the decision to allot the various Schengen activities, existing and foreseen, to the relevant parts of the legal framework of the European Union institutions as they are now emerging.

The present Government appear to have continued the policy of their predecessors on matters relating to travel, frontier controls, asylum and so on. It is true that we do not fit easily into the European pattern on those topics. As the noble Baroness, Lady Ludford, said, we have a substantial number of citizens and residents born outside this country, many from developing nations in the Commonwealth and we rightly feel a responsibility for such persons. Many of them have long-standing ties with this country and its institutions.

Although somewhat similar situations arise elsewhere--in France and Spain in particular--their nationality laws are different from our own, and those countries have nothing similar to the large cohort of people of British descent living in the former dominions, who very often have extremely close ties with their families of origin in this country. There is also the extensive anglophone world which looks to us in a cultural connection.

Rules regarding travel and freedom of movement tend to have a higher profile and a stronger impact in this country than in most other European nations. That must be one of the main reasons why successive British governments have favoured the opt-out/right to opt-in route with which we are now lumbered. Some may be irked by that expression, but as the report makes clear, the right to opt out and perhaps to opt in later, while exercising our preference for splendid isolation, raises a whole series of complicated problems which we have attempted to address in the report. The difficulty of those problems should not be underestimated.

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There are also practical disadvantages of exclusion from Schengen which are now beginning to appear. Under current arrangements, a citizen from a country outside the Schengen partnership, arriving at a Schengen state, will be subjected to a full passport check and visa control. Recently I experienced that myself when I arrived at Ciampino airport in Rome on a flight of the new Go airline. There were perhaps 200 passengers on the flight and just one member of the Carabinieri on hand to conduct the passport controls. As the passport details of every non-Schengen passenger had to be entered onto the computer, the whole operation took a long time and the mood of the passengers became disagreeable. They did not understand why their personal particulars deserved this degree of scrutiny. By opting out, we are subjecting our citizens to that kind of experience and no doubt Home Office Ministers will hear a lot more from such people.

Another substantial difficulty is the issue of democratic accountability. Joyce Quin, the Home Office Minister who was an impressive witness before us, clearly thought that the European Union Schengen system needed to be made more accountable before it could be acceptable to us. No doubt many people would prefer to retain the existing responsibilities of British Ministers and institutions rather than transfer them to the European Union. That is a traditional attitude that we can all readily understand.

However, there is an arguable case for a single European travel area, rather like that which we enjoy with Ireland at present, provided that we can buttress the European system that exists with appropriate methods of democratic supervision and control and which is more readily available to citizens than it appears to be at present. I cannot believe that it makes good sense to maintain our current preference for being "half in, half out" indefinitely. Would there not be great advantage in having a common set of rules on asylum? The Dublin Convention is the first step on that road. We want to avoid the difficult "pass-the-parcel" disputes that we have seen lately in, for example, the case of the Slovak gypsy refugees from the Czech Republic. That can be done only at the European level.

The report does not pretend to present solutions to those problems. It is just the first bite at the cherry and we expect to provide further instalments seriatim in future. I hope that the report will help to carry the discussion forward in a practical way. The immediate question is to learn from the Government what is in the Schengen Acquis and how they propose to handle the issues raised. I believe that we need to have that information before we deposit our instrument of ratification of the Amsterdam Treaty. I ask the Minister for an undertaking that he will give that information to the House before we deposit our instrument of ratification.

I feel sure that other members of the sub-committee will share my gratitude to the Home Secretary for the careful and reasoned style of the Government's response to our report. However, I feel that there is a good deal more to be said in favour of our participation in the Schengen system than the Secretary of State suggests. Also, that careful and reserved approach does not fit

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very well with the broad stance of the Government on European issues. At present, they are not in the "heart of Europe" on these policy issues, and some clearer correlation between the Government's general European policies and the Schengen arrangements would be welcome to me, at least. The sub-committee will be returning to an assessment of the balance of advantage in a further report in due course.

For the present I can offer just one consolation. As a schoolboy, I remember being taught that the speeches made in another place by Mr. Gladstone on successive Finance Bills were generally regarded as parliamentary masterpieces and, it was added, the best specific for bad cases of insomnia yet invented. It was not our intention, but I suspect that the series of reports on which we have embarked may come to constitute a rival remedy. Indeed, some Members of the House may have discovered it already.

12.52 p.m.

Baroness Nicholson of Winterbourne: My Lords, I congratulate the noble Lord, Lord Bridges, on his excellent speech. He called for a common set of rules which he stated can be achieved only at European Union level. I believe that my remarks will very much echo his.

I begin my congratulating the sub-committee on its immense and complex task. It has provided us with significant data which enable us to grapple with a complicated subject. My noble friend Lady Ludford referred to the complexity of the acquis, as did a number of other noble Lords. It is a complex acquis, perhaps because of its historical background. I believe that it was the noble Lord, Lord Cockfield, who drew our attention again to the 1985 Benelux Treaty, which began the collection of this acquis communautaire.

Today we are considering the question of security as well as of freedom. It is the incorporation into the framework of the Union of those two potentially conflicting points which gives rise to the complications to which noble Lords have referred in so many ways.

To me, it appears that our opt-in is an actuality. In fact, as one of the sub-committee's reports draws to our attention, we were in the Chair during the European discussions on Schengen. That was purely by virtue of this country occupying the presidency. Now that the Schengen and Europol Acquis is to be incorporated into Community law, we shall inevitably be drawn in because we shall be at the meetings at which those matters are discussed.

Perhaps I may remind the House of the achievements of the Schengen Convention. It strengthens the free movement of persons within its area according to the spirit of the Treaty of Rome. It abolishes checks at common borders between member states and strengthens checks at the external borders. It allows for a right of pursuit for police forces beyond national borders within specific conditions. It includes an area-wide computer system, which gives the capacity for the control of illegal immigration. It includes a safeguard clause for member states to resume border controls if national security is threatened. That clause has already

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been used by France during terrorist campaigns. It has not worked, but perhaps we should take that as proof positive of the vacuity of border controls in any case.

Contrary to received wisdom, when I was a Member of the other place and this matter was discussed extensively there, the Schengen Convention does not forbid police controls on the shores of the British Isles. On the contrary, it would strengthen them for all arrivals from non-EU member states, whether by sea or air, while removing them for arrivals from Schengen-area states.

I turn to Schengen's partner, Europol. I remind the House that it is an intelligence-gathering and intelligence-sharing agency, designed to provide support to national law-enforcement agencies and to improve co-operation between them. Naturally, it is based on a computer system which is accessible by designated police officers from member states. Above all, Europol is designed to improve the fight against typically transnational serious crime, such as terrorism and drug trafficking.

Europol is not a multi-national police force with its own powers of intervention. We shall not see Europol officers raiding drug smugglers in Brixton, for example. Despite the hopes of some Europeans that Europol may become a European FBI, with significant intervention, border control and international follow-up powers--an FBI without the shadowy aspects of its American counterpart--that is not on offer at the moment.

Why should Britain join Schengen and Europol? First, I suggest that we live with an illusion of insularity. Fighting crime and illegal immigration cannot be done by sovereign states alone. Modern organised crime has no borders. The drug-related money flow is now evaluated at 500 billion dollars a year--that is roughly half of the United Kingdom's gross national product. It is an illusion to believe that member states of the European Union--or anybody else--can fight that kind of criminality alone.

Secondly, the mafias around the world are more prosperous than ever before. They are organised on structured international networks. The Russian mafia, for example, traffics everything from vodka and heroin to steel bars and wheat flour. Much of its trafficking is cross-border. To establish patterns of trafficking and to uncover structures and networks, nation states must share information and competence. Who better to do that for the European nation states than Europol?

Thirdly, what about white-collar crime, such as computer hacking? Many billions of dollars are filched from banks and multi-national networks--and from local businesses, large and small--through computer hacking. I can see no way in which member states individually can fight that.

Fourthly, what about terrorism? I challenge anybody to find an example of a terrorist being arrested by border controls at any time in the past 20 years. Terrorists are far better organised than that. I know the way in which terrorism is organised by one of the Middle Eastern Persian Gulf organisations. That group has sometimes been coerced into a more peaceful form of protest

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against its own government by heavily co-ordinated activity from police forces worldwide. Terrorists are well organised these days and, as we know, fighting terrorism involves intelligence-gathering and sharing, infiltration operations and cross-border police missions. Schengen and Europol offer us that opportunity. In short, border controls as we know them have become largely irrelevant.

I turn now to illegal immigration which is, of course, a difficult point but fighting it is a domestic as well as a border task. Here our own Customs and Excise will find--indeed, may have already done so--that the computerised Schengen file is a most precious tool. I suggest to noble Lords that it is better to have a systematic and thorough check at the border of the Schengen area, rather than an expensive and ineffective system back here at home.

Data collection in that respect and for the Europol files are matters which have been focused on this morning by a number of speakers. However, quite simply, perhaps I may suggest that the classical argument of Britain joining late in European Union activities also applies here. Would it not have been much better to have had a presence at the beginning of such a system and thereby have been able to influence it in terms of human rights, civil liberties and on behalf of British interests, as well as on behalf of third party nationals, rather than not even joining yet and talking about it without the capacity to act? The built-in safeguards make the system government-friendly but our question here today is: are these computer systems--the data collection and the data protection--also citizen-friendly? If I understood correctly the thread of what noble Lords have said today, this House has rightly concerned itself primarily with the citizen. Indeed, I support that thrust.

However, I suggest that Schengen and Europol are actually designed to be an improvement on security with regard to the citizen and not a decrease of citizens' rights. If we look at Schengen overall, it will be seen that it is implementing the Treaty of Rome fully for the first time in history, while improving EU and non-EU border controls. Moreover, to a large extent, we can prove that it is working. Spain and Italy have now made remarkable progress in fighting illegal immigration since the adoption and incorporation of Schengen into their laws.

Schengen is not a sieve; it works. Illegal immigration is more apparent because member states have the necessary knowledge.

I believe that the case for Europol is even clearer. Interpol has never really been an effective agency. There is a lack of commonality of interests, to which I shall return in a moment, which is a problem similar to that of the United Nations. There is also the problem of the credibility of an organisation which, effectively, worked for the Axis powers in World War II. Of course Interpol was created in 1923, but Europol is an agency created by states with a commonality of history, of culture and of interest which already share sovereignty. I believe that that commonality offers us the opportunity--almost uniquely today--of a substantial number of democratic

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governments committed formally to the protection and the extension of human rights and civil liberties and to offering greater freedom to citizens--in this case of physical movement--while at the same time enhancing physical security.

The noble and learned Lord, Lord Hoffmann, questioned the difficulties of police information sharing and wondered where such information came from. Other speakers, the noble Lord, Lord Borrie, in particular, questioned the reliability of the information and called for minimum standards of data protection. The irony is that UK citizens will have greater protection even now under the Schengen Acquis and Europol protection than under UK laws. We need to look at history to see how the acquis has developed.

I call upon noble Lords to agree with me that we are in no position to lecture other member states on data protection with respect to personal privacy. The latter is not a right in the UK. It is a matter of great sadness to me, and to many of my colleagues on these Benches, that the Government did not grasp the opportunity to give British citizens personal privacy when we debated the data protection legislation. I commend the Government most strongly for their incorporation of the human rights provision into UK law, but I am sad that it falls to the courts to provide personal privacy for British citizens in the United Kingdom.

Some of the answers to the points raised by the noble and learned Lord, Lord Hoffmann, and the noble Lord, Lord Borrie, concerning reliability, minimum standards of data protection, police information-sharing and data collection lie in the incorporation of the very best practice of data protection. The information flows, which are noted in paragraphs 66 to 69 of the report of Sub-Committee E, fall within the data protection legislation which stems from Brussels. Part of its provisions rests on personal privacy, protection of the individual's reputation and legislation flowing therefrom. I say again, UK citizens are in the weakest position of all because we do not have that protection.

When introducing the debate so magnificently this morning, my noble friend Lord Wallace stated that this was an area of freedom for citizens. He talked about the need for parliamentary control and parliamentary oversight. I fully support that point, which has also been raised by other speakers today. It is possible that the Government could ask the European Union, in its incorporation of the Schengen Acquis into the Union, whether citizens' material might be better protected by significant use of encryption--namely, the device whereby records are kept private by means of altering or coding them and by altering them as they are being transmitted internationally and globally. I ask the Government to consider this matter most seriously. I worry about this because personal data are open on file. Citizens will have access to that data free, unlike citizens in the UK seeking access to personal data. But, as we are all aware, such data can be accessed by anyone these days if they are not protected.

When we talk about incorporation we need to recognise that Schengen is now moving away from political control. Unless we can bring it more fully into

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parliamentary scrutiny here and in the European Parliament, the UK will again be too late for the naissance of Schengen and its early years. Schengen is now a fact. I say again, the lesson is that we should participate in such activities much earlier. I support these excellent reports from the sub-committees and I call upon the Government to come into Schengen as fast as possible and recognise the reality of today's world.

1.7 p.m.

Lord Henley: My Lords, I shall endeavour to be brief because I believe that we have reached the stage where we would all like to hear the response of the noble Lord, Lord Hoyle, who is speaking today in the place of the noble Lord, Lord Williams of Mostyn. Perhaps I may also begin by offering my congratulations to Sub-Committee E, chaired by the noble and learned Lord, Lord Hoffman, and Sub-Committee F, which was chaired by the noble Lord, Lord Wallace of Saltaire, who introduced today's debate.

As always, I believe that we ought to offer praise to this House and its European Communities committees for the work they carry out in scrutinising European legislation and matters emanating from Brussels. I think that some of us have been described by the noble Baroness the Leader of the House as being "hopeless". However, I believe that even the noble Baroness would agree that those who serve on such committees--many of whom have been described as "hopeless"--do so with considerable distinction and perform a very useful task. The difficulty of that task has been much emphasised by the noble Lord, Lord Wallace, by the noble Lord, Lord Bruce, and by the noble Baroness, Lady Ludford. Indeed, they stressed the difficulties that both committees worked under in terms of lack of appropriate papers and information.

In referring to the report on incorporating the Schengen Acquis, the noble Baroness, Lady Ludford, referred to paragraphs 101 and 120. Therefore, there is no need for me to repeat them. However, I should like to underline some of the other comments made along the same lines which are to be found, for example, in paragraph 176 which reads:


    "In particular, we are astonished that national ratification of the Amsterdam Treaty will have been completed in most, if not all, Member States before a definitive list of the Schengen acquis has been established and made available to the national Parliaments in their own languages".
It continues at paragraph 177,


    "The Committee considers the presentation of the draft Decisions and accompanying Explanatory Memorandum inadequate".
As the noble Lord, Lord Bruce, made quite clear, that is a pretty damning indictment of the process and a damning indictment of those who should have provided the appropriate documentation. I urge the Government to do what they can to make sure that we are properly informed so that our committees can perform their tasks in a proper manner. I refer to paragraph 178 where the committee commends the Government for,


    "undertaking to involve the European Parliament but we do not consider that the European Parliament can be kept adequately informed if it has not been sent the relevant documentation".

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The noble Baroness, Lady Ludford, expressed the matter far better than I can when she mentioned her fantasies of "Yes Minister" with the Prime Minister trying to advance a case when he had not even seen the papers and did not know what the case was. This applies not only to the report I am discussing but also to the report produced by the committee chaired by the noble and learned Lord, Lord Hoffmann. I refer to paragraphs 81 and 83 of that report. Paragraph 81 states that,


    "The Third Country Rules raise major questions concerning the adequacy of data protection rules and the risks to the individual of the unlawful obtaining and use of information".
Yet these rules have been agreed without--at least in the case of the United Kingdom--that degree of public exposure and debate which citizens of the European Union and their parliaments are entitled to expect. Paragraph 83 states,


    "As mentioned in the introduction to this Report we firmly believe that the Third Country Rules should have been furnished in advance for scrutiny. During our enquiry the Home Office on several occasions sought to offer us some comfort by saying that the Rules were not 'set in stone'. That is no answer to the questions, whether of policy or legal construction, which the Rules have raised".
I hope that the noble Lord, Lord Hoyle, can take us a little further on that matter this afternoon when he replies to the debate.

The Labour Government hailed the deal on the borders last year as Labour's first European victory. I should stress that it was agreed by the previous government as long ago as March of last year. The Amsterdam Treaty established a new title for immigration, asylum and visa which significantly extends the European Union's role into internal affairs. These areas have now been brought under the remit of the treaty and its institutions; namely, the Commission and the European Court of Justice.

The Government claim to have secured an opt out on this title, although the Labour Government's opt out was contrary to their earlier declared policy of no permanent opt outs. I think the noble Lord will remember that the Government when in opposition stated,


    "we reject permanent opt-outs or 'variable geometry'".
That appeared in their paper, The Future of the European Union, in October 1995. The Government also claim to have secured an opt-in to this particular title, but this is not what it was originally said to be. Again I think the noble Lord will remember that the Prime Minister said on his return from Amsterdam,


    "We have the power within the treaty to go into any of these areas if we want to. If we do not want to, we need not, but if we do, no other country can block us going in".--[Official Report, Commons, 18/6/97; col. 319.]

I believe the Prime Minister was entirely wrong in that statement. In reality these opt-ins have to be decided by unanimity, giving any member state the right to veto future opt-ins, should the Government wish to opt-in. I think it was the Foreign Secretary who had to admit that there had been--as he put it--a misunderstanding. What happened was that the Spanish Prime Minister put forward an amendment in the early hours of the morning which had the effect of making the opt-in subject to unanimity. I suspect that both the Prime Minister and

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the Foreign Secretary quite simply failed to notice that. That is a serious matter in that it gives Spain, for example, the ability to insist on concessions on Gibraltar, if the British Government ever wished to exercise that opt-in. I should be grateful for confirmation from the noble Lord as to whether that is the case.

As I said, I wish to speak briefly, but I have one or two questions in relation to the report on Europol Third Country Rules produced by the committee of the noble and learned Lord, Lord Hoffmann. As I think the noble and learned Lord said, the report is highly technical and somewhat dry. I think the noble Lord, Lord Bridges, suggested that it was a suitable cure for insomnia. I tried that only last night and I had to continue my reading of the report in the early hours of this morning. It is fairly hard work and it takes some getting into. As I said, I have one or two questions to put to the Government. Paragraph 31 of the report states,


    "Each Member State is required to implement in its national law a standard of data protection which at least corresponds to that required under the 1981 Council of Europe Convention".
As the noble Lord will be aware, we passed the Data Protection Act earlier this year. It received considerable and detailed discussion in both this House and in another place. I was not actively involved with that Act, but it comes under the home affairs remit and therefore I took some interest in it. Can the noble Lord tell us whether that Act brings us up to the standard of data protection that is set out in the report?

I now come to my second and last question. I should be grateful for an answer to this question. It relates to paragraph 39 which deals with the question of which third countries have a sufficient level of data protection to allow them to be put in what is described as a "close relationship"?

I understand that the Home Office Minister, in giving evidence to the committee, stated that the United States, for example, has a sufficient level of data protection. That was queried by Justice which also gave evidence to the committee. I should be grateful if the noble Lord could let the House know in slightly greater detail, either now, or in writing, which countries it is thought have a sufficient level of data protection to allow them to be included in the scheme.

I end, again, by thanking both committees for the excellence of the work that they have carried out. I offer my particular thanks to the noble and learned Lord, Lord Hoffmann, who has completed some three years as chairman of this committee and will now stand down and no doubt move on to pastures new.

1.17 p.m.

Lord Hoyle: My Lords, I, too, am most grateful to the noble Lord, Lord Wallace, and to the noble and learned Lord, Lord Hoffmann, and to the sub-committees for their reports on the Schengen Acquis and the Europol Third Country Rules. Both are wide-ranging and complex subjects. I shall try to deal with the many points that have been raised. If I do not deal with a point today, I shall do so in writing. While the sub-committees' reports shed light on both Schengen

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and Europol in the context of future justice and home affairs co-operation within the European Union, there are many points that still need to be resolved.

However, I believe that the sub-committees have achieved their stated aim of explaining and clarifying the implications of incorporation of Schengen while the careful examination of the rules governing Europol's relations with third states and bodies will be most valuable in helping the Government to focus on these issues and to reach decisions on them.

The formal responses already provided by my right honourable friend the Home Secretary and my honourable friend Kate Hoey give the Government's detailed responses to the points raised in the reports. But I should like to take this opportunity to respond, so far as I am able, to matters raised today.

To take Europol first, it is important to stress that Europol is not, and is not intended to be, an operational body. It is not the EU equivalent of the FBI; nor would such an operational role be necessary or sensible. As was stressed by the noble Baroness, Lady Nicholson, we must co-operate on a European level. If we do not, we shall not be able effectively to tackle serious organised crime, which is growing on an alarming scale. Europol is necessary. It will become operative in the early part of next year. It will then support member states and authorities by collating and analysing criminal intelligence across Europe. However, it must go far wider than Europe if it is to be effective. We must have contact with competent authorities outside the European Union. That is the purpose behind the present proposal and it has led to many of the questions raised in the debate.

I listened with great interest to the remarks of the noble and learned Lord, Lord Hoffmann, in relation to his committee's report. He referred to the lack of prior scrutiny by Parliament before the Third Country Rules were agreed. The Government do not accept that the four sets of Third Country Rules meet the criteria for scrutiny. We see them as guidelines. In the Government's view, the significant documents will be the individual agreements concluded between Europol and individual third states and bodies. When those agreements are in the process of being drawn up the Government will ensure that they are deposited for scrutiny before being finalised. I hope that that goes some way to meet the strong point that was rightly made by the noble and learned Lord, Lord Hoffmann.

The noble and learned Lord also said that there is nothing in the report on Europol regarding data protection standards. The convention specifies adherence to the minimum standards laid down by the Council of Europe in 1981.


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