Proceeds of Crime Bill

Public Bill Committee, 20 November 2001.

Standing Committee B

Clause 6 - Making of order

Roger Gale (Conservative, North Thanet)

I remind the Committee that with this we are taking amendment No. 31, in page 4, line 5, leave out `a balance of probabilities' and insert

`the standard applicable in civil proceedings'.

Bob Ainsworth (Labour, Coventry North East)

I am trying to fathom out whether I will correctly pronounce the constituency of the hon. Member for Beaconsfield (Mr. Grieve) this morning, given that it was such a point of contention in the Chamber last night. He has given us two options for changing the standard of proof that will apply to confiscation proceedings. Before we adjourned last Thursday, he said that the amendments were probing amendments following the Government's decision to change the wording in subsection (7). The issue is important, as it has a crucial bearing on the way in which confiscation proceedings are conducted in the courts.

Amendment No. 30 would apply the criminal standard to the process of determining whether the defendant has a criminal lifestyle, whether he has benefited from any criminal conduct and the amount of the defendant's benefit. That would mean that the prosecution would have to prove beyond reasonable doubt all matters relating to the making of a confiscation order. It would restore the position to that which prevailed following the decision of the Court of Appeal in 1990 in the case of Dickens, which ruled that the criminal standard should be applied by the court in confiscation proceedings under the Drug Trafficking Offences Act 1986.

I recall that the then Government, whom the hon. Gentleman supported, said that they had always intended that the civil standard should apply to proceedings under the Drug Trafficking Offences Act. Indeed, amendments were introduced under the Criminal Justice Act 1993 to make it clear that the civil standard should apply both to the determination of benefit and to the amount to be recovered in drug and non-drug confiscation proceedings.

I am firmly opposed to amendment No. 30. If we were to change the standard of proof to that applicable in criminal proceedings, there would be substantial reduction in the effectiveness of confiscation proceedings. It would return us to the position that prevailed prior to the Criminal Justice Act 1993. There is a clear distinction to be drawn between the standard that applies to a defendant's trial and the determination of his or her benefits from such offences.

I come now to amendment No. 31. The hon. Member for Beaconsfield draws our attention to the current legislation, which stipulates

``the standard applicable to civil proceedings'',

and observes that we have changed that wording to ``a balance of probabilities''. The reason for the change is straightforward. In some civil proceedings, such as proceedings for contempt, the standard of proof is beyond all reasonable doubt. We wish to make it clear that that does not apply to confiscation proceedings. To avoid any doubt, we used the balance of probabilities formula in the Bill.

Nick Hawkins (Conservative, Surrey Heath)

I understand the Minister's point. Does he propose that the Home Office use the term ``a balance of probabilities'' in all future legislation, whenever it intends to use what we traditionally regard as the civil standard? My hon. Friend the Member for Beaconsfield pointed out that in other recent legislation the Government have used the wording of the civil standard.

Bob Ainsworth (Labour, Coventry North East)

I do not want to give an assurance off the top of my head that we shall use a particular form of words on all occasions. If the hon. Gentleman bears with me, we shall explore whether changing the wording of the Bill makes any difference to the level of proof required. On Thursday, the hon. Member for Beaconsfield suggested in Committee that by referring to the balance of probabilities rather than the civil standard of proof in clause 6, we intended to make a substantive change to the standard of proof that will be applied in confiscation proceedings. That is not so.

The hon. Gentleman suggested that the flexibility that the courts claim attaches to the civil standard of proof would not be provided if we used the wording ``a balance of probabilities''. In my view, that is not correct, and our opinion is supported by case law. In the case of Re H in 1996, the Lords considered the standard of proof in a child care case. Lord Nicholls, when discussing flexibility, referred to the balance of probabilities rather than the civil standard. He went on to explain what is meant by the term ``a balance of probabilities''. He said:

``The balance of probability standard means that the court is satisfied that an event occurred if the court considers that, on the evidence, the occurrence of the event was more likely than not. When assessing the probabilities the court will have in mind as a factor, to whatever extent is appropriate in the particular case, that the more serious the allegation the less likely it is that the event occurred and, hence, the stronger should be the evidence before the court concludes that the allegation is established on the balance of probability. Fraud is usually less likely than negligence. Deliberate physical injury is usually less likely than accidental physical injury . . . built into the preponderance of probability standard is a generous degree of flexibility in respect of the seriousness of the allegation.

Although the result is much the same, this does not mean that where a serious allegation is in issue the standard of proof required is higher. It means only that the inherent probability or improbability of an event is itself a matter to be taken into account when weighing the probabilities and deciding whether, on balance, the event occurred. The more improbable the event, the stronger must be the evidence that it did occur before, on the balance of probability, its occurrence will be established.''

From case law, we can be sure that the courts will continue to require the same sort of evidence as before in confiscation proceedings. I hope that the hon. Member for Beaconsfield is reassured by that, and is prepared not only to withdraw the amendment, but not to press amendment No. 31.

Dominic Grieve (Conservative, Beaconsfield)

If the state decides to confiscate someone's assets in the circumstances outlined in the clause, is it not being alleged that the person concerned has fraudulently, or at least dishonestly, acquired those assets? The draconian consequences of the confiscation order point to the fact that the civil standard of proof should be a high one. Is not that an argument for using the civil standard of proof rather than a balance of probabilities, which the Minister accepts was introduced to make confiscation easier?

Bob Ainsworth (Labour, Coventry North East)

The hon. Gentleman may understand these matters better than I do, but I have shown clearly the accepted precedent in law that the required standard of proof for the balance of probabilities varies with the seriousness of the offence. I do not know whether he contests that. The purpose of our wording is clear. We reject the amendment because it would be a retrograde step to accept it. It would apply the criminal standard to all confiscation proceedings, and that would be difficult to implement and would render the legislation useless. A change of wording from the civil standard to the balance of probabilities is not intended to change the evidence that is required. However, that is not the criminal standard. That standard applies in some civil litigation and that is potentially confusing. The standard is flexible. The more serious the allegation, the greater the degree of proof required by the courts under the balance of probabilities.

Nick Hawkins (Conservative, Surrey Heath)

Let me take the Minister back to what my hon. Friend the Member for Beaconsfield said when moving the amendment. Conservatives understand the Minister's point about amendment No. 30. He said that he believed that it would be inconsistent with existing legislation to introduce the criminal standard of beyond reasonable doubt or satisfaction so that a court is sure. He pointed out the distinction between our proposal and previous legislation. We are not wholly persuaded. The Bill will give draconian powers, which troubles us—that is why we wanted to probe him—but I shall concentrate my remarks on amendment No. 31.

The Minister set out his reasons why the balance of probabilities is the Government's preferred option. However, he conceded in response to my hon. Friend that that standard is the lowest that we could have. The Government say that they do not want a terribly high hurdle that those who wish to use the powers must get over. We are worried about that. My hon. Friend rightly mentioned the draconian consequences of the Bill, and the Government should bear it in mind that the prosecution should not have a low and easy hurdle to get over. There should be proper safeguards.

The Minister is correct to discuss varying standards of proof in civil proceedings. However, as he conceded, there is a difference between the balance of probabilities and the civil standard of proof. The use of the civil standard formula would give the courts and all concerned a clear indication of the type of safeguards that are required. He and his advisers must reflect on the matter, because it will perhaps be addressed on Report, and certainly in another place.

The Minister extensively quoted the comments of Lord Nicholls, and the Law Lords will scrutinise the matter. He also referred to the manner in which the two different tests of balance of probability and the civil standard have been used in recent legislation. He must concede that the Government have used the words

``the standard of civil proceedings''

in legislation as recently as just before the general election. He has difficulty saying that we should not use the civil standard of proof in legislation because there are civil proceedings in which the criminal standard is used. Their Lordships will understand the signals that are intended to be sent by referring to the standard of proof in civil proceedings, as the Government have done in recent legislation.

Ian Davidson (Labour/Co-operative, Glasgow Pollok)

Does the hon. Gentleman want to make it more difficult or easier to take assets from convicted drug dealers?

Nick Hawkins (Conservative, Surrey Heath)

We want a just result in every case. We do not want draconian confiscation. The hon. Gentleman has rightly been concerned throughout our proceedings with hitting the Mr. Bigs, and we share that view. Equally, however, he would not argue that merely because a Labour Government have introduced the Bill, the wording must by definition be right in every case. Our job as a parliamentary Committee is not to rubber-stamp proposals but to ensure that the wording is right and will be effective in achieving the objective that he and I share—to hit Mr. Bigs—while ensuring that powers are not introduced that are so draconian that they will turn us into a police state.

Ian Davidson (Labour/Co-operative, Glasgow Pollok)

Is that a yes or a no?

Nick Hawkins (Conservative, Surrey Heath)

We are not trying to make it more difficult for people who are properly the subject of the new powers to have their assets taken away.

Bob Ainsworth (Labour, Coventry North East)

You are.

Nick Hawkins (Conservative, Surrey Heath)

No, we are not. We are trying to do our job and ensure that the only laws that Parliament passes are just and proper ones.

I have made my point, and I do not believe that there is any point in repeating it, but we hope that even if the Minister is not persuaded today—

Bob Ainsworth (Labour, Coventry North East)

The hon. Gentleman may disagree with my comments, but he should not misrepresent them. He says that it is clear from my comments that we do not want a terribly high hurdle and that using the civil standard rather than the balance of probabilities would be a clear sign of the level of proof required. He may disagree with my comments, but in fact the burden of them is the reverse. The hurdle is being not lowered but clarified by changing the formula from the civil standard to the balance of probabilities.

Dominic Grieve (Conservative, Beaconsfield)

We doubt that.

Nick Hawkins (Conservative, Surrey Heath)

Indeed we do. Obviously we are not going to agree. My hon. Friend and I will invite Opposition Members and others who are worried about getting the law right to vote against the Government's proposal and for amendment No. 31.

Dominic Grieve (Conservative, Beaconsfield)

The Minister has not entirely reassured me. His argument seems circular. On the one hand, he argues that there is no difference between the balance of probabilities and the civil standard of proof, but on the other, he chose, presumably following advice, to change the wording between the draft Bill and this version in order to effect that transformation. He now reassures us, by way of a subtext, that reference to the balance of probabilities rather than the civil standard of proof will not constitute a terrible hurdle to confiscation.

The Minister made some interesting and correct remarks about the history of the matter, and that is where my anxiety stems from. As he is aware, following the introduction of confiscation legislation, the judiciary, in trying to apply the rules of fairness that should colour its approach, reached the conclusion that the only proper test that should be applied in confiscation was the criminal standard. Parliament said that it was unhappy with that, as is its right. However, it is worth bearing it in mind that the judiciary, in evolving its own rules, reached that conclusion in 1990, and I am sure that it did so because it was worried about unfairness, which should always colour the view of Parliament, and especially of the Committee. If justice is to be seen to be done, it must be seen to be fair.

As the Minister appreciates, my intention in tabling, perhaps with tongue in cheek, a return to the criminal standard of proof was not to press the matter to a Division. I accept that Parliament has made a decision on that, but the Minister has acknowledged that, for several years and under certain circumstances, the courts have had some latitude to evolve their own rules about the flexibility within the civil standard. However, it is not inconceivable that the judiciary would also exercise latitude if we were to stick with the balance of probabilities.

The allegation that is made in confiscation proceedings is akin to fraud: a person is accused of owning assets that have been obtained fraudulently, or by other dishonest means. As that is the case, there are compelling arguments for leaving the judiciary with discretion. It would have that in greater measure if the balance of probabilities were replaced by the civil standard of proof.

My point might be akin to counting the angels on the head of a pin, because it is open to doubt whether one form of words will produce a hugely different approach from the other. However, I prefer to refer to the civil standard of proof. It is an expression that is currently used more frequently than the balance of probabilities. It also sends out a signal that, in deciding on matters in which the burden is firmly placed on the people who are suffering the confiscation to prove their case, the judiciary is exercising a test under the civil standard that can be tailored to the circumstances. Moreover, the Minister's officials initially thought that that was the correct test to apply.

Bob Ainsworth (Labour, Coventry North East)

It appears that the hon. Gentleman wishes to return to the original wording in order to give the courts flexibility in deciding on confiscation up to and including the criminal standard. Is that the case? He has said that we are dancing on the head of a pin, but I am trying to identify how much more latitude would be allowed by the civil standard statement than by the balance of probabilities. The only potential difference is that flexibility would be allowed all the way up to applying the criminal standard in the case of confiscation. Is that his intention?

Dominic Grieve (Conservative, Beaconsfield)

No. If I had wanted to return to the criminal standard, I would have stuck out for amendment No. 30. I do not think that the court would return to that, but it would consider that the proceedings that are being brought are a serious matter, and the Committee needs to be of reminded of that.

I am in favour of confiscating ill-gotten gains, but the legislation is draconian. We do not wish people's legitimate assets to be taken away, but history teaches us that that might happen. On occasions, courts have refused to make such orders, or have mistakenly made them. As human affairs are imperfect, sometimes the wrong assets are targeted. Therefore, it is important that there should be safeguards for individuals. The court must apply the proper test.

As I listen to the Committee's discussions, I sometimes have a horrible feeling that the procedure is seen as a rubber stamp that follows after people are deemed to have a criminal lifestyle and to fall within the category—they have gone through the door, the door closes, down comes the stamp and away goes their money. I am sure that the Minister would agree that that is not what the legislation is about.

With regard to the circumstances that have been described, I believe that there should be safeguards. There is no doubt that much greater flexibility over civil and criminal standards has been introduced, certainly while I have been practising at the Bar. I have frequently conducted civil cases in which, at the end of the day, the judge has been only too happy to point out that he has reached his decision—just to rub it in for the party against whom he finds—because the evidence is overwhelming. If he is in a position to do that, it is helpful. Therefore, in my experience, judges have exercised greater flexibility.

I am worried that the balance of probabilities will constantly be thrown in the face of judges who have anxieties about cases, and that, although they may have doubts, and the case may not be clear-cut, they will go ahead and make their finding. If they had the civil standard of proof on which to rest, however, they would have greater flexibility in cases in which they might be concerned that injustice will be done. That is the nature of the difference. It is not a question of using the criminal standard of proof. All these matters are ultimately subject to some flexibility within the civil standard. I merely want to preserve that flexibility if a judge wishes to avail himself of it.

Ian Davidson (Labour/Co-operative, Glasgow Pollok)

Will the hon. Gentleman clarify whether, under the system that he proposes, it is likely that more or that fewer drug dealers would be able to retain their assets?

Dominic Grieve (Conservative, Beaconsfield)

I would hope that, under the procedure that we are discussing, exactly the same number of non-drug dealers would be able to retain their assets, and that exactly the same number of drug dealers would lose their assets. I am concerned not about drug dealers but about the innocent who may be put through this system with insufficient safeguards. We should not just be concerned about confiscating money from those who are guilty.

Ian Davidson (Labour/Co-operative, Glasgow Pollok)

I take your point about the innocent, but—

Roger Gale (Conservative, North Thanet)

Order. I remind the hon. Gentleman to address the Chair. I have no view on these subjects.

Ian Davidson (Labour/Co-operative, Glasgow Pollok)

I am sorry, Mr. Gale.

Will the hon. Gentleman bear it in mind that the system comes into operation only when somebody is no longer innocent, because they have been convicted? This issue is not about the innocent—it is about the guilty.

Dominic Grieve (Conservative, Beaconsfield)

The hon. Gentleman cannot have it both ways. The procedure under discussion is not a criminal one. The criminal procedure is when the individual is found guilty of the specific offence that triggers the mechanism of this process. The Minister has made it clear that we are discussing a form of civil recovery, albeit the confiscation mechanisms are unusual, because although there are civil recovery mechanisms later in the Bill, the confiscation mechanism under discussion is a hybrid.

Nevertheless, I always remember being told, when I appeared in court on civil matters and the person concerned had a criminal record, that even villains have rights. If we start moving away from that, we are making a serious mistake. Therefore, however villainous the individual may have been to have landed himself in this process, he is entitled, while the process is continuing—as it is a civil process—to the protection of the law. The civil standard of proof gives him the protection that he should have.

Stephen Hesford (Labour, Wirral West)

The hon. Gentleman makes a fundamental mistake. We are discussing a criminal procedure. It chooses to use the balance of probabilities, but it is none the less a criminal procedure.

Dominic Grieve (Conservative, Beaconsfield)

That is an interesting point. I think that I said earlier that it is a hybrid procedure. If it is a criminal procedure, I do not think that criminal procedures should be based on the balance of probabilities or the civil standard of proof. That would be an extraordinary departure from established principles of law in this country. However, I have never understood that to be the case. If one looks at it, it is plainly a hybrid, or, at least, a civil procedure—it is not a criminal offence to have the assets, but one will lose them. To my mind, that is akin to a civil procedure.

Ian Lucas (Labour, Wrexham)

Is not the essence of the procedure that it relates to criminals, and that it is not therefore a civil procedure?

Dominic Grieve (Conservative, Beaconsfield)

I disagree totally and fundamentally with the hon. Gentleman. You can be a murderer in prison, and you can bring a civil action—[Hon. Members: ``Steady on.''] No, I think that ``you'' is correct. Suppose, Mr. Gale, that you were a murderer in prison, and you wished to bring a civil action against prison officers in relation to having been assaulted. The hon. Gentleman is not telling me that, just because you happen to be a murderer in prison, a lower standard of proof or, perhaps worse, a higher standard will be imposed on you to prove your case in relation to that assault. That is plainly nonsense.

Ian Lucas (Labour, Wrexham)

Is not the difference between the two cases presented by the hon. Gentleman that the second is consequent on a conviction, and is not an entirely unrelated procedure? The murderer to whom he refers has rights, but they relate to an entirely different action. We are talking about an action that is consequent on a conviction that takes place immediately before the procedure occurs.

Dominic Grieve (Conservative, Beaconsfield)

I disagree again with the hon. Gentleman. The reason for the Bill is the Government's desire and intention to widen the scope of confiscation so that it is further and further removed from the precise circumstances of the offence that give rise to the triggering mechanism. I would have greater sympathy with his point of view if there were a close link and nexus between the assets that were being confiscated and the crime that had taken place. The classic example of that is provided by the Drug Trafficking Offences Act 1986, which, before it was widened, took account of the precise assets or benefits accrued from the particular offence. That legislation was subsequently widened to take account of the history of the likely drug trafficking. As we have discussed, the merit of the Bill from the Government's viewpoint, which is a perfectly legitimate argument—

Paul Stinchcombe (Labour, Wellingborough)

The hon. Gentleman makes an interesting point. He refers to the closeness of a nexus, but the relevant nexus is that between the crime and benefiting from it. How much closer can it be?

Dominic Grieve (Conservative, Beaconsfield)

As we have already discussed, the nature of the triggering offences may be wholly unrelated to the assets to be confiscated. I shall give an example, which is hypothetical but could happen. Suppose a middle-aged lady was convicted of three minor shoplifting offences, and those offences benefited her by a few pounds at most. However, it is brought to the notice of the prosecutor that, in fact, the individual is strongly suspected, although she has never been convicted—

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

Brink's-Mat, I suppose.

Dominic Grieve (Conservative, Beaconsfield)

Yes—of having been involved in Brink's-Mat. This example relates precisely to the Al Capone or Capone mechanism that we were discussing last week. The prosecutor might say, ``Here is a golden opportunity for us. Although this person was convicted on minor matters from which there has been no real visible benefit, we are convinced that under the confiscatory procedure we will be able to recover millions of pounds of illegally acquired assets.'' I have no objection to that. It is the merit of such a huge, wide process. However, it reinforces the fact that we should be careful about the abrogation of the ordinary civil rights of that person.

Paul Stinchcombe (Labour, Wellingborough)

Will the hon. Gentleman clarify the Al Capone point? Under clause 8, the court can recover only the money that is the

``benefit from the conduct concerned''.

There cannot be a closer nexus.

Dominic Grieve (Conservative, Beaconsfield)

I am not persuaded by that argument. I should be interested in receiving enlightenment from the Minister. I do not understand the procedure to be about that. The hon. Gentleman will correct me if I am wrong, but the confiscatory mechanism triggers a system by which it is possible to recover assets that are not related directly to the particular offence, on the basis that the person has a criminal lifestyle. It is the identification of the criminal lifestyle that gives rise to the confiscation.

Boris Johnson (Conservative, Henley)

We are all getting our knickers in a twist over the balance of probabilities because it relates to whether the defendant has a criminal lifestyle. The court must decide on the balance of probabilities whether the defendant has a criminal lifestyle, which as we discussed last week is difficult and absurd. That the matters under clause 4 must be decided on the balance of probabilities is a rum sort of triggering mechanism. The court must first decide whether the defendant has a criminal lifestyle and then whether he benefited from the conduct. If the chap does not have a criminal lifestyle, the court must decide whether he benefited from the criminal conduct. I do not understand why it is necessary to make the judgment whether the defendant has a criminal lifestyle, given that in either case it will be a matter of examining his criminal conduct and whether his assets can be taken away. If—

Roger Gale (Conservative, North Thanet)

Order. I am being as lenient as possible. I appreciate that such issues are complex, but an intervention should not turn into a speech.

Dominic Grieve (Conservative, Beaconsfield)

I do not know whether the Minister wishes to intervene to clarify the matter. I shall repeat my understanding of it to the hon. Member for Wellingborough (Mr. Stinchcombe).

Steve McCabe (Labour, Birmingham, Hall Green)

Will the hon. Gentleman set my mind at rest? I am worried about the poor little woman with three shoplifting convictions.

Norman Baker (Liberal Democrat, Lewes)

Or man.

Steve McCabe (Labour, Birmingham, Hall Green)

I am concerned about anybody, woman or man, with three shoplifting convictions, when all of a sudden horrible draconian powers will be in place to seize her million of pounds' worth of assets. If the person cannot legitimately show where she got all those assets from, where on earth does the hon. Gentleman think that they came from? What right has he to protect that poor little woman with her luxury villas?

Dominic Grieve (Conservative, Beaconsfield)

I was about to produce my handkerchief to wipe away my tears. The Minister has not disagreed with me, and I maintain my central point that the hon. Member for Wellingborough is wrong.

Mark Field (Conservative, Cities of London and Westminster)

We have heard robust defences from the hon. Members for Wrexham (Ian Lucas), for Wellingborough and for Birmingham, Hall Green (Mr. McCabe). The crux of the matter is the idea of Opposition Members that if an individual has assets, he will then have to justify where they came from. On the basis of minor offences and the presumption of a criminal lifestyle, does my hon. Friend agree that that belief is a fundamental misunderstanding of the state's role towards an individual? That is the core of the debate that we are having today and that we will no doubt have until the middle of February.

Dominic Grieve (Conservative, Beaconsfield)

I agree entirely. There is clearly a major philosophical disagreement, which was apparent on Second Reading. I have every sympathy with the idea of trying to identify criminals and confiscate their assets. However, I am conscious of the presumption that it is normal to assume that somebody who possesses assets does so legitimately, unless that can be demonstrated to the contrary. That has been an established rule in this country for a long time. The burden is normally on people who wish to say that assets are illegally obtained to prove that, otherwise the burden of proof could be reversed in criminal proceedings and, indeed, all proceedings. Every person would have to spend their lives justifying everything that they do. That is not a principle that is compatible with maintaining civil liberties. On that theme, I differ entirely from some Labour Members.

Bob Ainsworth (Labour, Coventry North East)

The hon. Gentleman is correct that all the matters are interrelated and that the confiscation procedures, and the attached burden of proof, will apply to those who are deemed to have a criminal lifestyle as well as persons who are subject to confiscation because of a case before a court. However, my hon. Friend the Member for Wellingborough is right, because we are discussing the amendments. Amendment No. 30 would change the burden of proof applied to those who are deemed to have a criminal lifestyle and to all confiscation cases. The matters are interrelated, and the would apply more widely than to those who are deemed to have a criminal lifestyle.

Dominic Grieve (Conservative, Beaconsfield)

I accept the Minister's point, but this is the Government's Bill. The burden of proof is on the Government to satisfy me—on the balance of probabilities, if not so that I am sure—that the Bill will not affect civil liberties. It was the Government's choice to word clause 6 as they did. He will appreciate that they could have kept the existing system and written a new clause to cover the wider situation, but they did not choose to do that. They have mixed the two matters together.

Short of rewriting the entire Bill—which is beyond my ability while I am also dealing with the Government's terrorism legislation on alternate days—I can only do my best to highlight problems. This problem is readily curable by substituting the civil standard of proof for the balance of probabilities, which is what I invite the Committee to do.

I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Amendment proposed: No. 31, in page 4, line 5, leave out `a balance of probabilities' and insert

`the standard applicable in civil proceedings'.—[Mr. Grieve.]

Question put, That the amendment be made:—

The Committee divided: Ayes 6, Noes 16.

Roger Gale (Conservative, North Thanet)

I am of the opinion that matters arising from the clause have been discussed exhaustively.

Dominic Grieve (Conservative, Beaconsfield)

On a point of order, Mr. Gale. I am sorry to suggest anxiety about the clause, but it raises at least one matter that is unrelated to the amendments: the fact that the Crown court has been selected as the forum in which to resolve and determine confiscation cases. I seek clarification on that matter from the Government.

Roger Gale (Conservative, North Thanet)

I shall allow the hon. Gentleman to make his argument but he will have to convince me that the subject has not already been discussed.

Question proposed, That the clause stand part of the Bill.

Dominic Grieve (Conservative, Beaconsfield)

In short, the Government have decided that the proceedings should be dealt with in the Crown court. I have no strong view on the subject, but anxieties were expressed about whether the Crown court has the expertise to deal with such applications. I foresee that it could acquire that expertise, but such proceedings usually take place in the High Court, and that is particularly important when the interests of third parties must be balanced. Will the Minister clarify why the Crown court was chosen as the forum for such cases?

Bob Ainsworth (Labour, Coventry North East)

We have heard representations that such matters should be dealt with in the High Court. We take the same view as the hon. Gentleman: if the Crown court is not capable of hearing such cases, we can provide it with the wherewithal—including training—and the capacity to do so. We want confiscation proceedings to be widely available, and we do not think that that will be possible if they can be heard only in the High Court. [Interruption.]

Roger Gale (Conservative, North Thanet)

Order. The Minister is a mildly spoken man, and I wish to hear what he has to say, even if no one else does. Private conversations must cease.

Bob Ainsworth (Labour, Coventry North East)

You have ruined the reputation with which others have tried to brand me by accusing me of being a mildly spoken man, Mr. Gale. I am flattered, and I shall go away and blush.

Confiscation has always been dealt with by the Crown court, but restraint and receivership proceedings, which are often complicated, are often heard in the High Court. The Government received representations on the subject, and carefully considered whether the Crown court, which would make confiscation proceedings more widely available, could provide the necessary expertise.

Dominic Grieve (Conservative, Beaconsfield)

I assume that the Lord Chancellor thinks that the Crown court can deal with such cases properly and that the necessary judicial training can be provided.

Bob Ainsworth (Labour, Coventry North East)

We are consulting the Lord Chancellor on that issue, and on the rest of the Bill.

Vera Baird (Labour, Redcar)

I have a friendly suggestion. Is it wise or necessary for subsection (4)(c) to give a judge the burden of deciding whether yes, the defendant has a criminal lifestyle or no, he does not? It would be better and more consistent with the purpose of the Bill if subsection (4)(c) were amended to read,

``if it does not decide that he has a criminal lifestyle''.

It is not the Bill's purpose to place a burden on the judge to decide that the defendant does not have a criminal lifestyle. The Bill's purpose is simply to allow the judge to decide whether the defendant has such a lifestyle, and if so, whether the provisions are triggered. If the judge is not sure whether the defendant has a criminal lifestyle, the provisions will not be triggered and the defendant will be saved. However, the judge should say that he has not decided that the defendant has a criminal lifestyle. The problem that may follow if he is forced to make a contrary decision is that a precedent will have been set. Although at that level the precedent would not be binding, and new evidence would unsettle it, the next judge who came to consider the next defendant would have to deal with a contrary finding if he wanted—on the strength of only one offence, as it was likely to be the intervening offence—to decide that the defendant had a criminal lifestyle. It might be a shade easier to appeal against the second judge's decision when it is set against a decision to the contrary by the first. I see no reason for creating that difficulty or causing that problem.

I hope that I have put the case succinctly. It is better if no decision is made by the first judge that the defendant does not have a criminal lifestyle against which the second judge's decision that he does can be assessed.

Mr. Hawkins rose—

Roger Gale (Conservative, North Thanet)

Order. I listened carefully to the hon. Lady, who makes a narrow point arising from the clause. I do not want us to repeat a debate that we have already had at considerable length about whether the phrase ``criminal lifestyle'' is appropriate.

Nick Hawkins (Conservative, Surrey Heath)

In light of your ruling, Mr. Gale, perhaps I should not pursue my intervention.

Vera Baird (Labour, Redcar)

If I inadvertently invited the reopening of that debate, I am glad that you were smart enough to block it off, Mr. Gale.

I have made my point, and I hope that it is helpful. It does not necessarily require a response now, but I invite the Minister to consider it.

I hope that a further point will not require too much indulgence. The requirement that precedes subsection (4)(c) is in subsection (4)(b). Under subsection (4)(b), if the court decides that the defendant has a criminal lifestyle, it must decide whether he has benefited. If it does not decide that he has a criminal lifestyle, it must decide whether he has benefited from his particular criminal conduct. What will happen if the court decides under subsection (4)(b) that he has a criminal lifestyle but has not benefited from his criminal conduct? Ostensibly, that would not trigger subsection (4)(c), which is triggered only if the decision is that he does not have a criminal lifestyle. Again, I do not require or demand an answer now, but I invite the Minister to consider those points and whether the provisions might be sharpened up.

Roger Gale (Conservative, North Thanet)

Order. The hon. Lady's first point was extremely narrow, but her second was much broader and would reopen a debate that the Committee has already had. If the matter is to be debated further, it must be debated on the Floor of the House at the appropriate time, on Report.

Mark Field (Conservative, Cities of London and Westminster)

I am mindful of your comments about reopening the matter, Mr. Gale. Do Members have the opportunity to say a few brief general words about clause 6 without reopening previous debates?

Roger Gale (Conservative, North Thanet)

This is a clause stand part debate. I have made it abundantly plain to the Committee that this Chairman will permit wide discussion of a clause at the beginning, in the middle or at the end of its consideration, but not at all three points. If the hon. Gentleman has new points to make that have not been referred to at all during the debate, I shall be interested to hear what he has to say, but I have studied the clause extremely carefully and am satisfied as Chairman that the matters arising from the clause, with the exception of the point that the hon. Member for Beaconsfield made, have been exhaustively discussed.

Mark Field (Conservative, Cities of London and Westminster)

On the basis that we have a further 433 or more clauses to go, I suspect that I may find an opportunity to make my point when we discuss one of those.

Roger Gale (Conservative, North Thanet)

A most wise decision.

Question put and agreed to.

Clause 6 ordered to stand part of the Bill.

Clause 7 - Time for making order

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

We now come to three relatively straightforward clauses, which is probably why I have been allowed to explain them. Clause 7 makes it clear that a confiscation order must be made before the defendant is sentenced in a case when there is no postponement under clauses 15 and 16. An advantage of that approach is that it enables the confiscation order to be taken into account before the court decides whether the defendant should be fined.

Roger Gale (Conservative, North Thanet)

Order. The Minister referred to three consecutive clauses. If it makes sense to the Committee, I am happy for them to be taken together. [Hon. Members: ``No''.] In that case, I ask the Minister to confine his remarks to clause 7.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

I was intending to do that, although I would have accepted your suggestion, Mr. Gale. It would have been a wise approach to take.

Nick Hawkins (Conservative, Surrey Heath)

On a point of order, Mr. Gale. I seek clarification. Although different amendments to the three clauses are printed on the amendment paper, I understand that you have been advised by the Clerk not to select them for debate for technical reasons. However, the issues raised by the amendments could be discussed separately in the three clause stand part debates. That is why the Opposition Front Bench want the three clause stand part debates to be taken separately.

Roger Gale (Conservative, North Thanet)

The hon. Gentleman will understand that there are sound reasons why those amendments were not selected for debate, but he is absolutely within his rights to raise their underlying matters if he so wishes.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

And we have another 440-odd clauses to go, as the hon. Member for Cities of London and Westminster (Mr. Field) said, as well as the winter before us.

In more complicated cases, the director of the prosecutor will apply for a confiscation hearing to be postponed under clause 15. In those circumstances, the defendant will usually be sentenced before the confiscation order is made. Clause 7 does not set a hard-and-fast rule for what happens in every case. It allows for appropriate flexibility.

David Wilshire (Conservative, Spelthorne)

I am grateful to the Minister for explaining matters, because as a layman I was somewhat confused. Amendment No. 70, which has not been chosen for debate, made an important point. It—

Roger Gale (Conservative, North Thanet)

Order. Before we proceed down that road, it might be helpful if I explain why amendment No. 70 was not selected for debate, although there is no particular requirement for me to do so. The amendment refers to the wrong part of the Bill. The provisions of clause 7 are already qualified by provisions under clauses 15 and 16, and at the appropriate time it will be possible to table amendments to those clauses.

David Wilshire (Conservative, Spelthorne)

I am grateful for your clarification, Mr. Gale. I asked that very point of the Clerk earlier this morning and received a helpful reply. I read clauses 15 and 16 and reached the conclusion that there was an issue to be dealt with. I am not disagreeing with the ruling, but clause 7 says what must or must not happen regarding sentencing. It refers to the time at which sentencing takes place, whereas clauses 15 and 16 refer to postponements of the making of an order. It could be argued that the two matters are linked, but I do not consider that they are the same. The general principle under clause 7 is important. It is correct and needs to be thought about.

Under the clause, the position is unfortunate to say the least. It could be more serious if the power were abused. A lawyer would probably tell me that I have misunderstood matters but, as a layman, I would have thought that, if I am called before a court, tried and convicted of an offence, simple common decency, in a civilised society, should dictate that I am sentenced as quickly as possible, rather than being left dangling for an indefinite period before I know my fate. Not letting someone know what their future is, on a random basis, for an indefinite period, is not the way that a civilised society should conduct itself. It therefore seemed to me, when I looked at the amendments, that a clause of this sort—without reference to clauses 15 and 16, to which I shall refer in a moment, if I may, Mr. Gale—under which one cannot be sentenced before something happens, should have a time limit on it, irrespective of what might be covered in subsequent clauses. There is therefore an argument to be made that the clause is not adequate.

Steve McCabe (Labour, Birmingham, Hall Green)

I have some sympathy with the hon. Gentleman's point of view. How would he ensure that the individual and his or her legal representatives did not use the safeguard that he is trying to develop to string out the process for as long as possible? If he wants to build in a time limit, part of that should require the individual and his or her legal representatives to co-operate fully with the process, and not to try to string it out to avoid sentencing when they are on bail and no doubt planning to abscond.

Mr. Wilshire rose—

Roger Gale (Conservative, North Thanet)

Order. These are complex issues. I draw the hon. Gentleman's attention to clause 15(4), which sets down the period to which he refers. As I explained clearly, the reason for not accepting the amendment was that it was at an inappropriate place in the Bill. It is in order for him to have this discussion, argument and debate, but he would need to table an amendment to clause 15, not clause 7.

David Wilshire (Conservative, Spelthorne)

I understand that, and I hope that that is what will happen. Again, I feel under constraint because if I say much about clauses 15 and 16, Mr. Gale, you will rightly rule me out of order because we have not reached that part of the Bill. As I understand clause 15(4), it refers to a two-year period during which the process of making a confiscation order can take place. Clause 7 refers to the point at which sentence is carried out, not a delay in the investigation. As a non-lawyer, it seems to me that we should be able to address the principle of how long a sentence can be delayed, rather than how long a process can be delayed before sentence, as a separate issue.

I am grateful to the hon. Member for Birmingham, Hall Green for saying that I may have a point in this regard, and he raises a perfectly valid sub-point that, if we safeguard the interests of the convicted person—I make no apologies for wanting to do that, in a civilised society, under those circumstances—somebody may try to take advantage of that. I accept that. However, there comes a moment when the layman's common sense must give way to the lawyer's expertise. That may be a bit of a weak response, but I am sure that it is not beyond the wit of the legal profession to pick up my point and find a formula of words that would safeguard the interests of the convicted person and also pick up that sub-point. I do not disagree with the hon. Gentleman in principle, but sadly, if he wants to know how to put that into practice, I cannot tell him.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

I do not want to be sycophantic, Mr. Gale, but it would help if both Government and Opposition Members were to take account of your advice. Perhaps I was tempting fate when I said that this matter was straightforward. However, I am a non-lawyer, if there is such a thing—to put it another way, I am not a lawyer—and it seems clear to me that there will not be a delay in sentencing. In simple cases, a confiscation order can be taken account of before the court comes to a view on whether the defendant should be fined as part of the sentence.

In cases in which it takes a long time to make a confiscation order, the prosecutor or the director will apply for a postponement so that there will be not be a delay in sentencing. In simple cases, people will be sentenced immediately after the confiscation order, and that will be taken into account in deciding whether a fine should be imposed, and in complicated cases, a sentence will be passed and a decision about the confiscation order will be taken later on. That is perfectly simple.

David Wilshire (Conservative, Spelthorne)

It might be perfectly simple to the Minister, who has the benefit of the advice of lawyers and civil servants, but it does not appear to be simple to me, and I disagree with him.

As the Minister has said—and as you, Mr. Gale, have said from the Chair—clause 16 states that it is possible to proceed to sentence if there is a delay, and that is being used as a reason for arguing that I should not be expressing concern about the matter. However, that clause also states that if, after a person is sentenced, it is decided that that sentence is wrong, it is possible to change it. If that is the safeguard that is being offered to the concerns that I have expressed with regard to clause 7, it is not strong. Legislation that says, ``We will quickly put you out of your misery, and subsequently change our minds if it suits our purpose,'' is not a fair response to the issue that I am raising.

Mark Field (Conservative, Cities of London and Westminster)

One of the concerns that is shared by many hon. Members of my party relating to the Bill—as well as to this specific clause—is that it is driven by the desire to confiscate money that has been illegally acquired by criminals, and is more interested in the issuing of confiscation orders than in the doing of justice. A balance must be struck between confiscation orders and sentencing. In that regard, the issue of timing is key. I doubt whether Labour Members would be greatly troubled by the notion that a sensible balance should be struck by applying clause 7 rather than clause 15(4).

David Wilshire (Conservative, Spelthorne)

I agree with my hon. Friend. By raising such matters, my hon. Friends and I are not seeking to undermine the principles that underpin the Bill. Those of us who stand up and say that we still believe that a convicted person has some rights do not need to apologise. A wish to uphold common decency in a civilised society is one of the reasons why we should proceed in the way that I am suggesting.

That is my general point, but I also have a specific question. The Minister stated that clause 7 means what it says if there is no postponement. I understand that, but, although I do not know how to draft a Bill of this sort, I am mystified by why, if clause 15 and 16 are relevant to clause 7, they are not mentioned in it to draw attention to the fact that they will also deal with the matter. If he was correct in saying that we must treat clause 7 as meaning what it says if there is no postponement, why does not it contain a statement such as ``Where there is no postponement a confiscation order must not be made''? I am sure that the lawyers know the answer, but it is not only lawyers who need to understand what is going on.

I will listen carefully to the Minister's response to the general points, but I would also be interested to hear his explanation of why the issues that he claims are contained in the clause are not actually spelled out there.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

The hon. Gentleman has made a reasonable point about reference being made in clause 7 to clauses 15 and 16. An amendment to clause 7 that stated, for instance, ``subject to the provisions under clauses 15 and 16'' might have been acceptable to the Chair, but I cannot speculate whether that would have been the case. I would not have had any objection if an amendment had been tabled under clause 7 that drew attention to either clause 15 or clause 16. Those clauses are integral to the Bill, as is clause 7. Clauses 15 and 16 refer to clause 7, so presumably there is no need for clause 7 to refer to them.

David Wilshire (Conservative, Spelthorne)

I am mystified, because clause 7 says something different from clauses 15 and 16. Is it permissible to have a Bill that says one thing in clause 7 and something fundamentally different in clauses 15 and 16?

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

I do not think that they are different. Further on in the Bill, there are clauses that qualify earlier clauses. I would not have objected if an amendment had been tabled under clause 7 that referred to clauses 15 and 16.

Ian Lucas (Labour, Wrexham)

I notice that clause 16(6)(b) refers to section 7 being ignored. However, I accept the point of the hon. Member for Spelthorne (Mr. Wilshire), and it would assist any judge to apply legislation if reference was made in clause 7 to provisions that are subject to clauses 15 and 16.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

We can certainly take that into account, and my hon. Friend and the hon. Member for Spelthorne made a reasonable point. We can examine whether it would aid interpretation to make reference to clauses 15 and 16 in clause 7. That would provide a cross-reference between clause 7 and clauses 15 and 16. I understand that earlier clauses can be qualified legitimately by later ones. However, if a cross-reference would help, we shall examine that.

David Wilshire (Conservative, Spelthorne)

I am sure that the Minister is right, because parliamentary draftsmen have been writing legislation for a long time and must have been making such qualifications. Does he agree that the wording in clause 7 that states that

``A confiscation order must be made''

is a bold statement? It does not suggest that the order must be made unless something happens. It would be helpful if the clause made reference to that.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

Yes, I have said that we will examine that to decide whether there is an advantage to be gained from including a cross-reference in clause 7. We will clarify that at a later stage.

Question put and agreed to.

Clause 7 ordered to stand part of the Bill.

Clause 8 - Recoverable amount

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

I had hoped that all three clauses were straightforward, although relevant points were raised about clause 7.

Clause 8 establishes the basic rule governing the calculation of a confiscation order. The amount ordered to be paid is described as the recoverable amount. That amount must equal the defendant's benefit or the amount actually available for confiscation, if that is lower. The amount available for confiscation is referred to as the available amount.

The court will calculate the available amount only if the defendant asks it to do so. The onus rests on the defendant to prove that the available amount is lower than the benefit.

Helen Clark (Labour, Peterborough)

The defendant should be involved in order to ensure that assets acquired by true and honest gain are not subject to a confiscation order. Are we leaving to the defendant the whole process of determining what amount of assets will be recovered, especially given that the amount available for recovery is less than the amount enjoyed by the defendant from his criminal conduct?

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

I understand the point that my hon. Friend is making, and I shall deal with it later in our debate.

The court will calculate the available amount only if asked to do so by the defendant. The onus rests on the defendant to prove that the available amount is lower than the benefit. If that was not the case, the prosecutor would have to prove that there was sufficient property available to satisfy the confiscation order, which is a tall order in many cases, and virtually impossible when the defendant has hidden assets.

There is a discretion, however, in subsection (3) for the court to make any necessary adjustment to the recoverable amount to take account of claims by victims against the defendant in respect of the conduct concerned. That is consistent with the court's powers to have regard to such claims when making a confiscation order under clause 6(6).

Dominic Grieve (Conservative, Beaconsfield)

The Minister has touched on a point that will arise when we discuss a later amendment. Who comes within the category of victim? Will they be the victims of the individual offences of which the person has been found guilty, or, more generally, will they be the victims of the general criminal conduct, who may emerge during the investigation? I have always assumed that it was the former, not the latter. There is some imprecision, and I should be grateful for some clarification.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

I agree that clarification is necessary. Perhaps it might be better to refer to the matter when we reach the hon. Gentleman's later amendment.

Subsection (2) makes it clear that in such a case, the revised amount must not exceed the available amount. Subsection (4) is new. It requires the court to deduct from the assessed benefit any benefit that is already the subject of a civil recovery order or a cash forfeiture order part 5. The aim of that is to avoid double recovery of the same benefit.

Subsection (5) is slightly different from the current legislation. Each time the court decides the available amount, it must draw up a statement setting out its calculations. At present, the court is obliged to do that only in cases when it decides that the available amount is lower than the assessed benefit. The purpose of the change is to improve the information available to the authorities when enforcing the confiscation order.

David Wilshire (Conservative, Spelthorne)

I am worried about a couple of issues. Some flexibility that is not aimed at assisting the convicted person could be useful. Subsection (1) states:

``The recoverable amount for the purposes of section 6 is an amount equal to the defendant's benefit from the conduct concerned.''

In most cases, that is correct. However, in other cases it could prove utterly impossible to be 100 per cent. certain that the amount was equal to the benefit. There could be a huge dispute about whether it was equal. It may benefit the Bill for the courts to have some discretion. I understand why the amount should not be more than equal to the benefit, and that we should not be taking more than the defendant's benefit as a result of the crime for which he is being convicted. It may assist the court, however, to say that it the amount can either be equal to the amount of benefit or a lesser figure. That is for the benefit not of the convicted person but of the court, because it could recover an amount without there being a protracted dispute about what ``equal to'' might mean. There could well be an argument on appeal when it could be shown that the amount was not equal to the benefit so the order should be declared invalid. I can envisage such a thought process. Will the Minister consider having flexibility under subsection (1), whereby the court could say that the amount would not have to be more than the benefit, but could be less?

Subsection (2) states:

``But if the defendant shows that the available amount is less than that benefit the recoverable amount is . . . the available amount.

It would be worth exploring the possibility of having flexibility in such circumstances, too. It does not take too much imagination to know that someone in such a position will do his or her level best to make sure that the available amount is as small as possible. However clever the lawyers are, however efficient the court is and however many accountants pore over such information, there will still be even cleverer lawyers and accountants who will reduce the maximum amount to a much smaller available amount.

I fully accept that it is wrong that we should seek to take away from people—even criminals—property or assets that they have acquired legally and legitimately, but I do not understand why a convicted criminal who has managed to spirit away some of the proceeds of crime should not at a later date be held to account for the money that has gone walkabout, by targeting the assets that he subsequently acquires legitimately. Someone who has spirited away £2 million or £3 million of the amount that should be paid may suddenly win a £15 million jackpot on the lottery. That person will have avoided paying £2 million or £3 million of the ill-gotten gains of crime just because he managed to reduce the available amount, so I do not understand why he should not subsequently be required to repay the proceeds of crime when he suddenly finds himself in pocket. That does not fly in the face of my understanding of justice. Under subsection (2), it may benefit the court to say that the amount recoverable is either that or a sum that it may decide. The arrangement would then be flexible and could take account of what might happen subsequently.

Nick Hawkins (Conservative, Surrey Heath)

I wish to raise a point slightly different from that raised by my hon. Friend. In our earlier proceedings, those of us who have had some experience of the way in which the old drug trafficking orders worked discussed the length of time that the courts took after the original criminal conviction. I hope that the Minister will be able to say whether the Government have made an assessment of how much court time is likely to be taken up in cases when the defendant asks for the matter to be assessed. All members of the Committee are concerned about pressures on court time. I understand why the Government say that they are putting the onus on the defendant because the prosecution may find it difficult to establish such points. I hope that the Government will have used their experience of how the old drug trafficking orders worked to calculate in what proportion of cases the matter may arise, and how much time will be taken up in court. The Committee will want an indication of that.

Ian Davidson (Labour/Co-operative, Glasgow Pollok)

May I raise some points with the Minister, initially about subsection (1)? One of my colleagues has reminded me about the relatives of the hon. Member for Beaconsfield, who were cattle rustlers. Will the Minister clarify the amount considered to be equal to the defendant's benefit in the theft of a cow?

Dominic Grieve (Conservative, Beaconsfield)

I do not think that my relatives committed an offence, because they stole the cattle from the other side of the border. As the law then stood, there would not have been any criminal benefit in such circumstances.

Ian Davidson (Labour/Co-operative, Glasgow Pollok)

I shall not digress on the subject of cross-border traffic. I do not think that the hon. Gentleman's relatives were involved in a normal commercial arrangement—after all, in his maiden speech he described them as cattle thieves—so we can probably leave that aside.

I return to the cost of cattle theft. Is the amount equal to the defendant's benefit the replacement cost of the cow, or the price realised if it is resold? If it is the latter, will there be an obligation on the guilty party to clarify the price for which the cow was sold? That is particularly important in terms of reset. If the price is to stand, will the defendant be obliged to produce the name and address of the person to whom the stolen goods were resold? That would be helpful in some circumstances. The cow could have had value added to it—by cutting it into joints, for example. The money received from the sale of the individual parts would then probably be greater than the replacement cost of the cow or the normal resale price. That idea is particularly relevant to drugs. The cost of a kilo package of drugs would be much less than the price realised by selling the same quantity of drugs in small bags. Which amount would be used to calculate the benefit?

I shall now pick up the idea not of the little old lady with three shoplifting offences, but of tachographs, which the Conservatives advanced as a major factor. The Minister should be able to tell us about the defendant's benefit in tachograph offences. Recently, I was reading an article in the 16 June edition of the Leicester Mercury—as one does. The article said:

``Blakes Chill Distribution Ltd was fined a total of £72,000 and ordered to pay £9,000 costs by . . . magistrates after admitting 227 charges of failing to produce tachograph records. The firm, a subsidiary of Express Dairies Plc . . . asked for 217 similar charges to be taken into consideration.''

That seems to represent a consistent pattern of bad behaviour. [Interruption] Yes, as my hon. Friend the Member for Glasgow, Anniesland (John Robertson) says, it reflects a criminal lifestyle.

The article continues:

``The firm failed to produce these records within a permitted time scale during an investigation at its depot. As a result, 168,000 kilometres were missing from the driving records for one month alone.''

That shows that tachograph offences can be serious. Will the Minister give us guidance about how the defendant's benefit would be calculated in such circumstances?

Nick Hawkins (Conservative, Surrey Heath)

I would not want the hon. Gentleman to believe that my hon. Friend the Member for Beaconsfield and I suggested that tachograph offences were not serious. If he believes that we said that earlier, he has entirely misunderstood the point. My hon. Friend and I know of tragic cases with fatal consequences that arose because people committed tachograph offences. None the less, the hon. Gentleman is making a good point.

Ian Davidson (Labour/Co-operative, Glasgow Pollok)

What I described was the impression that I received on the previous sitting. The Opposition mentioned tachograph offences and the little old lady with the shoplifting offences in order to belittle what was proposed and attempt to divert us.

I can give the Minister another reported example, in which the father of the Scottish Formula 1 star David Coulthard was fined and sentenced by Scotland's traffic commissioners. An article about it states:

``A public inquiry into two haulage firms run by Mr Coulthard revealed he had personally paid fines totalling almost GPB 30,000 for drivers who had broken the law more than 130 times . . . More than 70 offences were admitted by drivers at courts across the country after a major investigation''.

An operation discovered that

``drivers at a Carlisle-based firm that was subcontracted by Hayton Coulthard had accumulated 130 offences relating to falsified tachograph records in November, 1998. The firm J&K Williamson, trading as Williamson and Co, claimed at Kendal Magistrates Court in June 1998 that Hayton Coulthard had ordered their drivers to break the law by falsifying records.

The inquiry heard claims that Hayton Coulthard had threatened to withdraw contracts if they did not comply.''

Those examples confirm the points that I made in the previous sitting about tachographs. That example shows not a trivial offence committed by one driver, but a case in which employers force drivers to commit offences under threat of dismissal and withdrawal of contract.

Dominic Grieve (Conservative, Beaconsfield)

I entirely agree with the hon. Gentleman. He may recollect that I raised the example of health and safety offences. I have been involved in health and safety cases in which the offence was clearly committed for criminal gain. I do not disagree with the hon. Gentleman, but the points that we made about tachograph offences in the previous sitting showed how wide the category of offences is. Individual tachograph offences that are not linked to the type of conduct that the hon. Gentleman identified fall into a different category. His examples show how broadly the nature and seriousness of tachograph offences can vary.

Ian Davidson (Labour/Co-operative, Glasgow Pollok)

I must confess that that was not the impression that I gained from Opposition Members. I thought that it was clear that they were trying to suggest that the Bill could be used to pick up trivial offences such as shoplifting or tachograph offences. If that is a retreat by the hon. Gentleman, I am prepared to accept his confession of wrongdoing, and I shall say no more about the matter. Perhaps he will reconsider his outrageous defence of cattle rustling, to which I shall return on another occasion.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

We have had an interesting debate—more interesting than I had expected. I am glad to see the hon. Member for Spelthorne returning, because we are talking about the recoverable amount, and I am sure that he will agree that we have three options: the amount can be more than, equal to, or less than the

``defendant's benefit from the amount concerned.''

We all agree on that. No one suggests that it should be more than the defendant's benefit; at least, I have not heard that argued—

Dominic Grieve (Conservative, Beaconsfield)

I am surprised.

Mr. Foulkes—however much that may surprise the hon. Member for Beaconsfield. The amount available for recovery could be less than the defendant's benefit, and we have described those circumstances. It seems sensible that the Bill should specify that the amount recoverable should normally equal the defendant's benefit. That brings me to my hon. Friend the Member for Glasgow, Pollok (Mr. Davidson).

David Wilshire (Conservative, Spelthorne)

I followed the Minister's argument until the very last moment, when he said the words ``normally equal''. I have made the point that the sum should not always, but normally will, equal the defendant's benefit. The sum could, therefore, be less, and it could be to the court's advantage that the sum should be less than the defendant's benefit. I had hoped that the Minister would take that point on board.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

As I understand it—unless I have got it wrong—we have already dealt with the question of the available amount. When the available amount is less than the defendant's benefit, ``You cannot take the breeks off a Hielan'man''. A Hielan'man wears a kilt; he does not own breeks, so they cannot be taken away from him. I am sure that the hon. Member for Spelthorne understands what I am saying.

David Wilshire (Conservative, Spelthorne)

Perhaps the Minister credits me with more intelligence than I possess, because I have always thought that I would need a visa to travel north of Watford.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

I am sure that the hon. Gentleman would be welcome in Scotland at any time.

I return to the points that have been made about the phrase,

``equal to the defendant's benefit''.

My hon. Friend the Member for Glasgow, Pollok asked about the calculation, and he raised interesting questions about cows: should the value of the living cow be calculated, or the value of the cow after it has been butchered and made available for other purposes? He also raised the recurring questions of tachographs and muddled shoplifters. I direct him to clause 80, which describes how the value of property obtained from criminal conduct is calculated. The Committee will return to the interesting question of the calculation of specific benefits in specific crimes and cases.

The hon. Member for Spelthorne said something that must not be allowed to pass unchallenged, and I will deal with that after I have dealt with the following two points. The court has the power to revisit the available amount—to take another look at it—and that matter is covered in clause 23. The question of court time was also raised. We have not undertaken an estimate of the time it takes to assess the available amount, but it is essential that that is done, and the court should do it. I assure hon. Members that that is not a new requirement.

Nick Hawkins (Conservative, Surrey Heath)

I accept the Minister's point that that time will need to be taken, but I ask him, yet again, to consult his officials so that he can offer an assessment of how much time will be taken. If he cannot provide that now, will he do so later? It would be possible to make an assessment of it, based on the experience of drug trafficking orders, and that would be helpful to the Committee.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

I am not sure whether that would be helpful to the Committee. The hon. Gentleman is worried about the amount of time that will be taken up by the court, but I am also concerned about the time that would be unnecessarily taken up by officials in calculating matters that are difficult to calculate. That would impose extra burdens. My hon. Friend the Under-Secretary has more than this piece of legislation to deal with: as the hon. Member for Beaconsfield said, legislation on terrorism is also being considered, and it would not be sensible for Home Office Ministers and officials to spend a lot of their time making assessments and calculations that would not be of any real benefit to the Committee.

Nick Hawkins (Conservative, Surrey Heath)

I shall put my point to the Minister in a different way. One of the legitimate concerns that is always felt about legislation that introduces new operations into the criminal courts is how it will work in practice. If I thought that officials in the Home Office and the Lord Chancellor's Department never undertook such assessments, I might agree with the Minister that what I am requesting would impose an unreasonable extra burden. However, he would surely concede that they frequently undertake such assessments.

My request is not unreasonable: I have made it when shadowing both the Home Office and the Lord Chancellor's Department, and estimates were provided. I am not asking that my request be acceded to immediately, but when Parliament scrutinises proposals such as those under discussion, it must have some idea what effect they will have on the operation of the criminal courts.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

I tell the hon. Gentleman again that this is not a new requirement. If he wishes his question to be answered, he should go and see how long it takes under the present legislation, or he should talk to the hon. Member for Beaconsfield, who could give him an indication, as he has practical experience of the matter.

I return to a strange point that was made by the hon. Member for Spelthorne, as it epitomises many of the points that have been made by at least one of the Opposition parties. He was anxious that the available amount should not be reduced by salting away money in other ways, so that the court would not have access to as much money as possible. However, amendment No. 32, to which he has put his name, would do precisely that. That epitomises what my hon. Friend the Member for Glasgow, Pollok said earlier—it is difficult to know whether Conservative Members really want to make the Bill effective.

Dominic Grieve (Conservative, Beaconsfield)

We shall deal with amendment No. 32 in a moment, but I must take the Minister to task. How is the point made by my hon. Friend the Member for Spelthorne incompatible with amendment No. 32, which asks the Committee to consider whether bona fide debts should have a special category? As I shall explain, there are social and economic reasons for that, and it has nothing to do with salting away money.

Roger Gale (Conservative, North Thanet)

Order. As I have said repeatedly, these are complex and interrelated issues. None the less, I would not want the merit or otherwise of amendment No. 32 to be debated at this point.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

Of course—and neither would I, Mr. Gale. I was just pointing to an inconsistency and referring to it in passing. We shall discuss it in greater detail later.

David Wilshire (Conservative, Spelthorne)

Will the Minister give way?

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

If this is on the same point, it might be better not to give way to the hon. Gentleman just yet.

David Wilshire (Conservative, Spelthorne)

This is nothing to do with amendment No. 32. I just wanted to say that I failed to make myself clear when I was explaining what concerned me. I was not trying to encourage people to salt away money. I was flagging up the point that, despite the desire on both sides of the House to make the maximum effort, if history runs true to form, some people will still succeed in salting away money. I was merely saying that that should not be an excuse for not seeking to get it back in the future, which is the opposite of what I think the Minister heard me to say. I apologise for that.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

No, no. I apologise if I misunderstood the hon. Gentleman. Now that I understand him, and appreciate what he said, there is every reason for the Committee to agree that clause 8 should stand part of the Bill.

Question put and agreed to.

Clause 8 ordered to stand part of the Bill.

Clause 9 - Defendant's benefit

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

Hon. Members will recall that clause 8 provides that the amount of a confiscation order is the amount of the defendant's benefit or the available amount, whichever is lower. Clause 9 explains how the defendant's benefit is decided. Subsection (2) provides that the court must take account of conduct and property obtained until the time that the court takes its decision. Subsections (3) and (4) are designed to avoid double counting the same conduct. Hon. Members will note that the court will now be required to deduct confiscation orders previously made against the same person in any part of the UK. The current legislation has developed piecemeal on this point, and we seek to rectify certain omissions.

David Wilshire (Conservative, Spelthorne)

When I spoke to the Clerk this morning I was reassured that clause 9(2) did not mean that the court would take account of honestly gained assets. Will the Minister confirm that? Subsection (2) states:

``The court must—

(a) take account of conduct occurring up to the time it makes its decision''.

I assumed, perhaps wrongly, that that meant that the court must take account of conduct of a criminal nature that had occurred up to the time of making the order. Subsection (2)(b) states that the court must

``take account of property obtained up to that time.''

Similarly, I assumed that that meant property obtained as a result of criminal activity, rather than property that had been got hold of, purchased by or given to people in a totally legitimate and legal way. Will the Minister assure the Committee that the court will take into account criminal acquisitions, rather than totally innocent and above board acquisitions? If so, will he also say why clause 9 does not spell out the fact that the court should be taking into account criminal conduct and property obtained by criminal means?

Roger Gale (Conservative, North Thanet)

Order. I invite the Minister to offer clarification if he wishes to—but with the caveat that many of the relevant issues will be dealt with under clause 11.

Nick Hawkins (Conservative, Surrey Heath)

When the Minister responds, will he be able to point to other legislation that has used the phrase ``general criminal conduct''? Rather like ``criminal lifestyle''—I do not want to reopen that debate now, as it would not be proper to do so—it strikes me as a slightly unusual phrase. I appreciate that the Minister may not be able to provide a precedent immediately, but it would be helpful to know where, if at all, that phrase has been used in other recent legislation. When my hon. Friend the Member for Beaconsfield and I first looked at the Bill, it struck us that it raised some of the same issues as ``criminal lifestyle''.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

It would perhaps be better to deal with that last question later. Bearing in mind your admonition in relation to clause 11, Mr. Gale, I shall answer the point made by the hon. Member for Spelthorne. Subsection (2)(b) must be read in the context of subsection (1), which relates to decisions on benefit from conduct. Clause 76(4) provides that

``A person benefits from conduct if he obtains property as a result of or in connection with the conduct.''

Therefore, the reference to property in clause 9(2)(b) must be read in that context.

David Wilshire (Conservative, Spelthorne)

Is the conduct to which clause 9(1) refers criminal conduct, or all types of conduct?

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

As I understand it, it deals with criminal conduct, as does clause 76(4).

David Wilshire (Conservative, Spelthorne)

If that is so, why does it not refer to ``criminal conduct''.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

Perhaps because it is assumed that, as we are dealing with confiscation of the proceeds of crime, the conduct will be criminal.

Ian Lucas (Labour, Wrexham)

Clause 9(1) begins:

``If the court is proceeding under section 6''.

It clearly relates to the procedure following criminal conviction.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

I am grateful to my hon. Friend for that additional clarification. I can tell the hon. Member for Surrey Heath that I am not aware of other legislation that refers to ``general criminal conduct''.

Dominic Grieve (Conservative, Beaconsfield)

My hon. Friend the Member for Surrey Heath has picked up on an important point, which the Minister may want to consider in the context of the clarity of the Bill. I have often found this Bill difficult to follow. I realised that it would be a complex piece of legislation, but it is not easy reading. It contains constant reference back, and constant tendencies to use terms such as ``conduct''. I, too, ascertained that that term refers back to the ``general criminal conduct'' referred to in clause 6(4)(b). However, such references are not often apparent. I am sure that partly draftsmen have special skills, one of which is not to repeat what is unnecessary—surplusage. However, sometimes the Bill is difficult to follow. Clearly, the clause should be aimed only at criminal conduct, but when there is a move away from the specific offence to something wider, it is important to have precision.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

I appreciate what the hon. Gentleman says. If he, as a distinguished practising lawyer, has a problem understanding an aspect of the Bill, he will understand how those of us who are not lawyers share his difficulty—even with excellent briefing. However, I can underline what my hon. Friend the Member for Wrexham said in relation to the point made by the hon. Member for Spelthorne. Clause 9(2) must be read in the context of clause 9(1), which refers back to clause 6. Therefore, we are talking about criminal conduct.

Norman Baker (Liberal Democrat, Lewes)

It is important to have clarity, and if that means repetition, that is beneficial and sensible. The phrase ``general criminal conduct'' appears again in subsection (3) and clause 11, so it is not as though it has been accepted and put to bed. It reappears throughout the Bill, and it is rather odd that it is missing here. For the sake of clarity and the avoidance of doubt, it would be helpful if it were repeated.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

I understand the hon. Gentleman's point, and I shall take it on board. As was pointed out earlier, clause 7 does not refer to clauses 15 and 16, whereas clauses 15 and 16 refer to clause 7. I understand that the legal draftsman said that it was not strictly necessary to include such a reference. However, I agree that even though it may not be strictly necessary, it might make the matter clearer, and for the avoidance of doubt, we shall consider the idea.

Boris Johnson (Conservative, Henley)

I should add that it would be a good idea to insert the word ``illegally'' into the reference to property or property obtained by criminal conduct, because that goes to the heart of what we are trying to do. Are we suggesting that it is right to take away all property from criminals in punishment for their crimes, or are we specifically trying to take away property that arises from criminal activity? I should be grateful for some clarification from the Minister on that point. Are we punishing criminals by taking away property irrespective of how it was obtained, or only property that was obtained exclusively illegally? That should be made clear.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

I understand the hon. Gentleman's point. We all agree that it is implicit in the Bill that the reference is to property that has bene illegally obtained. I believe that he is saying that it might be better to make that explicit in the Bill. We shall consider the idea. It may not be strictly necessary to do that, but it might be for the avoidance of doubt. I would not be unhappy if at a subsequent stage amendments that clarified that fact were made.

Ian Davidson (Labour/Co-operative, Glasgow Pollok)

I am heartened by the suggestion by the hon. Member for Beaconsfield that he finds this difficult to follow, because I thought that it was just me who did. At least we agree on that. I should like clarification from the Minister on how someone's ill-gotten gains and legitimate income will be dealt with. I want to avoid circumstances in which people can admit that they have committed and been found guilty of offences, and then say that all the money that they have obtained from them has been spent on slow cars and fast women—or slow horses and fast women; whatever is the chosen poison—and all the money that they have left was obtained entirely legitimately, and therefore cannot be touched. That would be completely contrary to the thrust of the Bill as I understand it, and I should be grateful if the Minister would make it clear that someone's legitimately obtained assets are none the less available to be partially or wholly taken to pay the costs of crime.

Norman Baker (Liberal Democrat, Lewes)

If someone has used the proceeds of crime to invest and has built up a substantial sum in excess of the amount that was illegally obtained, is it not important to make clear the position of that element of the money and assets?

Ian Davidson (Labour/Co-operative, Glasgow Pollok)

That is vital. It is crucial that that be made explicit, and it be put beyond the ability of the courts to reinterpret Parliament's intention. It should be absolutely explicit that any assets that someone has are liable to be seized to repay the amount from which they are assessed as having benefited through crime.

Boris Johnson (Conservative, Henley)

A split seems to be opening up in the Labour ranks. I distinctly heard the Minister say that there was no question of taking away property except in so far as it had been illegally obtained. However, if I understand the hon. Member for Glasgow, Pollok correctly, he is saying that he wants everything that a criminal has to be up for grabs, and that all assets are fungible and may be taken away. He would not support the insertion of the word ``illegally'' in the reference to property in subsection (2)(b).

Ian Davidson (Labour/Co-operative, Glasgow Pollok)

I thank the hon. Member for Henley—and for The Spectator, South—(Mr. Johnson) for raising that issue. I may be expressing myself poorly, but let us suppose that someone who had obtained assets as a result of criminal conduct argued that they were no longer available because they had been spent, and that the assets that were available had been obtained legitimately. That should not be a reason for someone to be allowed to go scot-free without paying any compensation. It has been said that there is a split between our Front and Back Benches. Well, there are occasions when Back Benchers are more in line with the mood of the country than some elements of the Mr. Softy tendency. On occasions, that tendency has been displayed in another place—but that description does not apply to the Ministers in this Committee.

I seek clarification from the Minister about the length of time. I am unclear about why reference is made in some parts of the Bill to a period of six years, as under clause 11. Does that apply to clause 9, or are someone's available assets counted back to the beginning of time or, as in the case of the hon. Member for Beaconsfield, to the second or third generation, when his family were stealing cattle and sheep? I was under the impression that he claimed Scottish ancestry. He said in his maiden speech that his relatives lived in Roxburghshire 400 years ago. He then went on:

``by the middle of the 18th century, my family had graduated from being cattle and sheep thieves''—[Official Report, 21 May 1997; Vol. 294, c. 789.]

If he is now saying that his relatives were Scottish cattle and sheep thieves who were stealing from the English, that may put a different light on the matter. It may be less of an offence than I had originally thought; it would be helpful if he clarified it. I was under the impression that, as a good lawyer, he was preying on his neighbours, which is certainly worthy of contempt.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

Again, we have had an interesting debate. I accept that it is unlikely, but let us imagine that the hon. Member for Beaconsfield were convicted for being involved in criminal activities. If a confiscation order were taken out against him, it would not be appropriate to take account of the benefits that his long-deceased ancestors may have obtained from their alleged stealing of sheep and cattle. I hope that I have reassured the hon. Gentleman, if not my hon. Friend the Member for Glasgow, Pollok.

Dominic Grieve (Conservative, Beaconsfield)

I am small fry compared with my right hon. Friend the Member for Devizes (Mr. Ancram), whose family made a huge fortune in the 16th century. They became such important thieves that they eventually received a peerage, which is fairly standard practice. However, my right hon. Friend would not be able to lay his hands on those assets now.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

The right hon. Member for Devizes used to be my pair, and I know all about his background. Devizes is the third seat that he has represented in Parliament. No doubt it will be the last.

Roger Gale (Conservative, North Thanet)

Order. The Chair is unaware of the existence of pairing.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

Yes, and so are the Whips, at the moment.

I assure the hon. Member for Henley that there is no split between my hon. Friend the Member for Glasgow, Pollok and me on the matter. We are as one on the Bill, as we are on many matters.

Boris Johnson (Conservative, Henley)

I do not understand how that can be the case, because the hon. Member for Glasgow, Pollok has already called the Minister Mr. Softy, if I understood him correctly. I direct the Minister's mind like a laser towards the hon. Gentleman's point. He believes that all assets owned by a criminal should be recoverable. However, the Minister believes that only assets that are the proceeds of crime should be recoverable. If a criminal can demonstrate that he has assets that are honestly gotten, should those assets not be recoverable?

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

I am about to address that point. I must do so quickly, before this becomes associated with the alleged split between the Chancellor and the Prime Minister, and who is on which side of that argument.

Roger Gale (Conservative, North Thanet)

Order. Happily, those issues are definitely out of order.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

In every way, Mr. Gale.

I can tell the hon. Member for Henley and my hon. Friend the Member for Glasgow, Pollok that it does not matter if the criminal has spent the illegitimate money because even if it has been spent, it will still be counted for the purpose of calculating the benefit from criminal conduct. When calculating the available amount, we will examine all assets, whether they are legitimate or not.

As for the six-year period, when a person has a criminal lifestyle, we will examine his benefit from general criminal conduct. That represents all conduct, however far back it goes. Assumptions help in that assessment, but they are restricted to the six-year period.

Helen Clark (Labour, Peterborough)

Why was the six-year period chosen?

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

That is a very good question.

Roger Gale (Conservative, North Thanet)

Order. It is an excellent question—and it can be addressed when we reach clause 11.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

That is what I was about to say, Mr. Gale. We shall consider that question when we reach clause 11, which I am thankful to say is being dealt with by my hon. Friend the Under-Secretary.

We could insert the word ``criminal'' before the word ``conduct'' in clause 9, because it is about the calculation of the benefit rather than the available amount. We may examine that idea. However, I hope that, following my explanations, the Committee will agree that clause 9 should stand part of the Bill.

Question put and agreed to.

Clause 9 ordered to stand part of the Bill.

Clause 10 - Available amount

Dominic Grieve (Conservative, Beaconsfield)

I beg to move amendment No. 32, in page 5, line 30, leave out paragraph (b) and insert—

`(b) to pay any sum which is a lawful and bone fide debt.'.

Roger Gale (Conservative, North Thanet)

With this, it will it will be convenient to discuss amendment No. 75, in page 5, line 33, leave out subsection (3).

Dominic Grieve (Conservative, Beaconsfield)

I would like the Committee to think a little about the background purpose of what we intend to achieve and whether, in achieving it, we risk endangering innocent third parties excessively.

I have examined the wording of clause 10. I am sure that the Minister will tell me that it follows previous practice, but that does not mean that we should not examine it afresh. Clause 10 will provide that values are calculated, and thereafter the only deductions that can be made are fines and sums that would be included among preferential debts if the defendant had gone bankrupt. The consequence would be similar to a bankruptcy proceeding, and would have a similar effect on any creditor of a defendant whose assets were confiscated. Although I understand why bankruptcy is considered to be similar to the process on which we are embarking, the process is actually very different. A person goes bankrupt usually because he cannot pay his debts. Once that has happened, there is a system to try to ensure that certain creditors are preferential—they fall into quite a small category—and thereafter it is the law of the marketplace. If there is not enough money for everyone to be compensated, the main creditor who asked for the bankruptcy to take place takes precedence over the other creditors.

I am anxious about the process because these are not bankruptcy proceedings; the person does not have any debts but a public policy decision is taken, very properly, that an individual should be deprived of his assets because he cannot show that they were not illegally obtained. I should be interested to know what has happened in the past; if the process has been applied to earlier rules there are likely to have been innocent casualties.

The hon. Member for Glasgow, Pollok gave examples of individuals in his constituency leading a criminal lifestyle, which suggests that although they are living off benefits they have also been enjoying other assets and spending freely. Those are likely to be small-scale examples; because of the sub judice rules I cannot mention a case that especially springs to mind, as the person concerned is about to undergo trial. However, I can think of individuals leading a lavish lifestyle, who have very large properties and who have long been suspected of engaging in illegal conduct. Some seizure of assets might take place if those people had been convicted. In such circumstances, many individuals—small businesses, shopkeepers, and so on—who have provided them with goods and services may be awaiting payment, but as a result of the process they are not preferential creditors. If the vast majority, if not all, of the assets concerned are confiscated, perfectly legitimately, the shopkeepers and others will be the innocent victims of criminality and of the fact that the assets were originally obtained illegally or were the result of criminal conduct.

In such circumstances, and especially as we are in the process of extending the net to catch a much wider category of person, is it right to have a rule which says, in effect, ``You should have been more careful. You must assess whether a person is creditworthy. If, in spite of having a lavish lifestyle and huge assets, he is not creditworthy, because those are the result of criminal conduct, you have to suffer the consequences''? Is such a public policy decision the right approach, or should we consider that the matter is not akin to bankruptcy, where someone has to make a commercial assessment of a person's creditworthiness? If that assessment fails there will inevitably be victims.

In this case, we should be considering not whether the ordinary rules of bankruptcy should apply but whether there should be another set of rules to ensure that bona fide creditors receive compensation for the services or goods they have provided. Some services, once provided, no longer have a monetary value; goods in the defendant's possession may have a monetary value but they may be of considerably less value than the amount that was supposed to be paid for them. I simply flag up the issue, and I would be interested to hear the Minister's comments. If his aspirations are realised, we are about embark on a process that will lead to many such proceedings and applications. As a result of the lawful and justifiable steps that the state will take against them, it will also impel many people into bankruptcy.

Are we to say to the many victims, ``Sorry, this is one of life's commercial realities and you will have to face up to it. There is nothing we can do for you''? Or are we to say, ``You may not be a preferential creditor, but you are undoubtedly a bona fide creditor, so you should be paid out''? It is a public policy issue, and I fear that it might lead to considerable harshness. Where is the necessity in public policy terms to justify such harshness?

Finally, I may have misunderstood the Minister earlier, but I fail to grasp the connection between the amendment and salting away one's assets. I can see a vague connection. Under the clause, a defendant could claim that he owed money to individuals who are not bona fide creditors, which might make the court's task a little more complicated.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

A lot more.

Dominic Grieve (Conservative, Beaconsfield)

Why would it be so difficult for a court to extrapolate and identify bona fide creditors? To put it in its most straightforward fashion, if a local grocer down the road has supplied groceries and is owed £5,000—it could be the balance between his own bankruptcy and business failure, and survival—a person who was not a preferential creditor would surely be readily identifiable and readily assessable as completely innocent. In those circumstances, are we to say, ``We're terribly sorry, but all that money will have to come to the state. You won't see a penny, even though we have just collected £5 million''? I find that odd. Why does the Minister believe that it would be so difficult to make such an assessment?

I am asking only for an equitable system that has regard to the fact that the state, which is in receipt of the money, has never been in a creditor's position—except insofar as the circumstances relate to tax provisions later in the Bill. There I see no reason why ordinary tax rules should not apply. Otherwise, however, the state is taking money from someone on the grounds that it was obtained unlawfully. In those circumstances, why should the state be the preferential beneficiary, as against people who have become victims?

I asked the Minister earlier who the victims in this category were. I suspect that the direct victims are those for whom a compensation order has been ordered by the judge on conviction. It is an important issue, and just because no one has thought about it, or because that has been the practice in the past, it does not mean that we should not think about it today.

Norman Baker (Liberal Democrat, Lewes)

The hon. Gentleman has raised an important issue, to which I hope the Minister will respond. One of the Bill's underlying philosophies, which my colleagues and I support, is to catch criminals who have so far escaped justice—even if, as stated on Second Reading, they are the ``pillars of society''. We are talking about people who are respected and who appear to have committed no illegal activities, but people about whom there is evidence to disprove that. The Government want to ensure that such people are brought to justice or their assets seized. They are right to do so. Those people will not necessarily stand out as having a criminal lifestyle. The ordinary shopkeeper whom the hon. Member for Beaconsfield described, or the ordinary supplier of goods and services, may be caught up by these arrangements in a situation that is to their great disbenefit.

I am thinking of a case in my constituency that related to a different Bill, but it could equally apply here. A one-man builder secured a big contract for a seemingly respectable person. He then spent six to nine months on the job and got in subcontractors to help. The person went bankrupt, with the result that the builder went bankrupt too, owing the subcontractor lots of money. I would not want that situation to be repeated here unnecessarily. This is not about how much money is taken from the person who has illegally obtained proceeds from crime. The amount will stay the same. The question is what happens to it. It is wrong if innocent people such as small shopkeepers, one-man businesses or whatever will suffer as a consequence.

The Minister will tell us that there would be problems in saying who was a legitimate beneficiary and who had a legitimate contract with the person who was deemed to have the illegal proceeds of crime. I accept that. But we must find a way to protect ordinary people who can have no way of knowing that the person with whom they have an agreement has been involved in crime. They have entered a legitimate contract to provide something in return for money, yet before they know where they are, this person has been swept up in the criminal or civil proceedings and they cannot receive the money to which they are duly entitled. None of us wants to weaken the legislation and make it easier for someone to get off the hook or to keep money to which they are not entitled, but if we can find a way to ensure that innocent third parties do not suffer, that must be to the benefit of everyone.

Nick Hawkins (Conservative, Surrey Heath)

I want to add to the excellent speeches of my hon. Friend the Member for Beaconsfield and the hon. Member for Lewes (Norman Baker). I share their concerns. I want to make a further point to emphasise why the amendment is wholly different from amendments about which Labour Members have been suspicious in the past. I doubt whether any of them will leap to their feet to suggest that we are trying to undermine the primary purpose of the Bill. We are clearly not talking about the defendants. We are trying to protect those who everyone accepts are wholly innocent people. They are innocent third parties such as the Lewes builder and the Beaconsfield grocer, who are conducting their normal business. They have no way of knowing that the person with whom they are doing business may be involved in nefarious activities that may subsequently lead them to be subject to the Bill's provisions.

A central function of Parliament, particularly of scrutiny in Committee, is to try to ensure that legislation does not, because of a side wind, have adverse consequences for the entirely innocent who were never intended to be the targets of the legislation. Even though the Minister will probably tell us that it will make the assessments more complicated, that is not a sufficient excuse. We must make sure, in every law that we pass, that we do not accidentally hit the little people. That is our concern.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

I understand that concern—and I am not going to say what the hon. Gentleman thinks that I was going to say.

The clause allows us to calculate the defendant's available amount, but it does not wipe out any debts that he or she may owe to the little trader that Opposition Members mention. The defendant would still owe all those debts.

Nick Hawkins (Conservative, Surrey Heath)

I understand what the Minister says, and I appreciate that he says that he has never dealt with such matters professionally, but he has misunderstood—albeit genuinely—the effect of the Bill. In my experience, and that of my hon. Friend the Member for Beaconsfield, the innocent little person will lose out because the state's rights will take preference over all creditors. We do not challenge the fact that outstanding debts will still count in law, but there will be no money left to pay them.

Although the hon. Member for Lewes was describing an ordinary civil bankruptcy, the consequences that befell the builder that he mentioned will recur as a result of the Bill. Perhaps the Government are prepared to introduce their own amendment to prevent such consequences. We hope so, even if they do not accept our amendment. As a consequence, all the money will be taken under subsection (1)(b) and subsection (3), and there will be no money left to pay ordinary civil debts.

Norman Baker (Liberal Democrat, Lewes)

Is not the key provision subsection (1)(a), which mentions ``free property'' and ``obligations''? What constitutes an obligation? Debts that are legitimately owed to third parties should constitute obligations. That would reduce the amount available to the state.

Nick Hawkins (Conservative, Surrey Heath)

Yes. In order to satisfy us, the Minister and his officials would have to show that they had taken much advice from expert full-time insolvency practitioners. My hon. Friend the Member for Beaconsfield and I have said that those who specialise in insolvency work should advise us on how to determine the available amount, but we have not yet received a response. Both of us did some insolvency work when we practised at the Bar, and our reading is that the Bill will cause the little people to lose out. It will take a lot to convince us, and even the Minister will concede that the provisions are not clear. I hope that he at least concedes to look again at the issue.

There is a serious danger that the Bill could give rise to something almost as bad as the Crichel Down case, a major case that set out the principles of the relationship between Parliament and the citizen. The Minister smiles, because he has heard it referred to on many occasions over the years, but some hon. Members may not have come across it. It involved land that was appropriated for military purposes during the second world war and not given back. Some citizens undoubtedly suffered gross injustice. It came to public prominence because it was a major case that led the way on the subject. The late father of the well known actress Susannah York was one of those who lost out in the case.

We are concerned that many innocent, legitimate traders who are unlucky enough to do business with someone who becomes a target under the Bill will be unable to continue in business. They will be plunged into bankruptcy in the manner that the hon. Member for Lewes described. That would be an unintended consequence of the Bill; no hon. Member would wish it to happen, but there is a serious danger that it will. I hope that the Minister will say that he will look again at the matter in detail.

Ian Davidson (Labour/Co-operative, Glasgow Pollok)

I wonder whether the Minister will respond to that point with caution, because it seems an example of what may be characterised as the Devizes defence, in which offenders or their relatives point to someone else, and say that he or she has committed a bigger offence. When taxed with the iniquities of his relatives, the hon. Member for Beaconsfield attempted a diversion by offering to give up the right hon. Member for Devizes, saying that he was a bigger offender. That is reminiscent of the defence along the lines of ``a big boy did it and then ran away''—a defence that many of us have heard in the past.

Although we might have sympathy for people who are bankrupted in such circumstances, am I right in thinking that that would have an adverse effect on small traders only if all the assets of the criminal involved were seized? Is that likely to happen frequently? If such a measure is introduced, what steps would the Government or the courts take to avoid the creation of fraudulent debts? It is possible that a set of villains who knew that they were under suspicion would create a web or a network of interlocking debts between themselves for services rendered—or not rendered—in an effort to decrease the amount of money that they had available?

Dominic Grieve (Conservative, Beaconsfield)

I accept that if people have remaining assets after their assets have been seized under the procedure, those remaining assets would be available to pay for the debts that the Committee has discussed. In some instances, that might not be a problem. However, I am talking about cases in which people lose all their assets—and I believe that that will frequently happen.

Nick Hawkins (Conservative, Surrey Heath)

My party is happy for there to be a proper inquiry into any fraudulent transactions, or interlocking transactions, that a defendant might come up with. That should happen. We do not want anybody to get away with the deliberate creation of fraudulent apparent debts. Our sole concern is that the provision might hit entirely innocent people. The court should have the opportunity to look at deliberate attempts to create fraudulent debts, and to ignore them. The Bill gives the court the power to look at matters such as tainted debts—as they are called. We do not seek to open a loophole. My party's intention is to ensure that the entirely innocent should not be hit, and I think that the hon. Gentleman agrees with that.

Ian Davidson (Labour/Co-operative, Glasgow Pollok)

That is true. However, difficulties will arise if the concept of interlocking transactions that the hon. Gentleman raises becomes a reality. Presumably, if that happens, the only transactions that will come to light are those that the criminal who is being convicted brings forward, and the balancing contracts might not be produced at all if villains were to lend each other money. That would be a deliberate attempt to distort, and it would be difficult to gainsay.

Given that we are dealing with people who are, in many cases, pillars of the community, and who have lent money and engaged in transactions with other—alleged—pillars of the community, the scope for obfuscation is considerable. The amendment under discussion is almost certain to result in the opening up of an enormous number of loopholes—although I am sure that that is not the intention behind it.

Norman Baker (Liberal Democrat, Lewes)

I am prepared to accept that difficulties and loopholes might be created. Nobody wants that to happen. The hon. Gentleman has championed the cause of the ordinary person—the man in the street who does not have much money and is not a Mr. Big. He is very keen on doing that. Does he not accept that there is a danger that the people whom he champions will be adversely effected if changes are not made?

Ian Davidson (Labour/Co-operative, Glasgow Pollok)

Yes, I accept that there is a danger of that, but I am also aware that any opportunity that is taken to champion the rights of those whom I wish to protect will open up a loophole.

Norman Baker (Liberal Democrat, Lewes)

It is a question of balance.

Ian Davidson (Labour/Co-operative, Glasgow Pollok)

Yes, that is correct, and I am not convinced that the proposed catch-all removal is the best way of addressing the matter.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

As the hon. Member for Beaconsfield, who moved the amendment, said, the effect would be to allow unsecured creditors to take preference over the settlement of a confiscation order. I am referring to amendment No.32; amendment No. 75 is consequential to amendment No. 32. The Government do not support the principle behind the amendment.

My hon. Friend the Member for Glasgow, Pollok questioned the hon. Member for Beaconsfield about the purposes behind all of the Opposition amendments, and the effect of almost all of them was to weaken—

It being One o'clock, The Chairman adjourned the Committee without Question put, pursuant to the Standing Order.

Adjourned till this day at half-past Four o'clock.

Standing Committee B

Clause 10 - Available amount

John McWilliam (Labour, Blaydon)

I remind the Committee that with this it will be convenient to take amendment No. 75, in page 5, line 33, leave out subsection (3).

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

Before the break, one of my colleagues was saying that my responses to Opposition Members may be too kind and generous. I was pointing out that the amendment, like most of the Conservative party's amendments, would weaken the Bill's powers to deal with those who have gained proceeds through criminal action. It would make it more difficult for such proceeds to be recovered, and I find that astonishing.

Mr. Dominic Grieve (Beaconsfield) rose—

John McWilliam (Labour, Blaydon)

Order. Before I call the hon. Gentleman to speak, I wish to say that gentlemen may remove their jackets. Those who have done so already without permission had better consider putting them on again.

Dominic Grieve (Conservative, Beaconsfield)

The Minister's remarks surprise me. Our job is to scrutinise the Bill. If there are areas in it that need to be strengthened, we shall suggest ways in which that can be done. It is difficult to see areas in which the Bill could be strengthened, as I think is the Government's intention. Indeed, if we were to embark on such a strategy, we might end up with a regime such as that run by Mola Omar. We are heading gently in that direction as it is. If legitimate areas require strengthening for the purpose of ensuring justice, we shall table the appropriate amendments.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

We have not seen any yet. Issues can be probed just as well by proposing to make matters harder for criminals as they can by proposing to make matters easier for them. Yet again and again, time after time, amendment after amendment, all we get from the Tories, who profess to be hard on criminals and to want to confiscate the proceeds of crime, is, ``Oh, no. Let's make it a bit easier. Let's find exceptions. Let's find ways round it. Let's give them loopholes.''

Nick Hawkins (Conservative, Surrey Heath)

We all understand the party political knockabout in which the Minister is now indulging. However, he has chosen to make such comments about absolutely the wrong clause. Even the hon. Member for Glasgow, Pollok (Mr. Davidson) understood that amendment No. 32, of all those that we have discussed, has the least to do with happens to the defendant. Until the Minister spoke, I thought that the Committee had accepted that the amendment was about innocent people who might be unfortunate enough to have dealings with those who are the subject of the Bill. The Minister is on the wrong track.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

Aha. I am about to prove the hon. Gentleman wrong. Nothing could be further from the truth. Genuine worries have been expressed about debtors, especially by Liberal Democrat Committee members.

Nick Hawkins (Conservative, Surrey Heath)

All of us have expressed concern.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

Perhaps Conservatives have expressed concern, too. The amendment would substantially undermine the Bill's provisions.

Mark Field (Conservative, Cities of London and Westminster)

The Minister believes that Opposition Members are being awkward or soft on criminals, but we are scrutinising the provisions. Such matters will receive the same scrutiny—if not more—from solicitors and barristers when they go to court. There must be a sense of justice. We are discussing the payment of a lawful and bona fide debt. We do not want innocent third parties to suffer three, four or five transactions down the line. It would be wrong to have a draconian rule against those individuals. I am sure that Labour Members understand our position. There should not be a new law in that regard.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

I understand the hon. Gentleman's position. Barristers, advocates and lawyers can make their own case and speak powerfully for themselves. People in another place will, no doubt, have vested interests. Our vested interest is on behalf of people who are suffering because of drug dealers, money launderers, criminals, and their activities. That is why we want the Bill to be as powerful and effective as possible.

As hon. Members have said, only preferential debts, which are included in section 386 of the Insolvency Act 1986, are discounted from ``the available amount''. Those debts are mostly debts to the state, such as outstanding tax debts, but they also include outstanding remuneration of employees, which will satisfy the hon. Member for Lewes (Norman Baker). The Bill protects the same list of creditors that are protected in bankruptcy proceedings. It seemed to our draftsmen that it was right to use those provisions, and not, as the hon. Member for Beaconsfield (Mr. Grieve) said, because the rationale is exactly the same. The provisions seem to be appropriate and to have the right sort of pedigree and purpose.

Nick Hawkins (Conservative, Surrey Heath)

I hope that the Minister will consider a serious point with those who advise him, even if he cannot accept it today. There is a difference between a trader who deals with a company that might be at risk of bankruptcy and a legitimate small trader. The trader can protect himself by all sorts of means such as credit checks, whereas it is impossible for the legitimate small trader to find out in advance that the person with whom he is dealing, who is apparently a pillar of society—to use the words of the hon. Member for Glasgow, Pollok—may later turn out to be a criminal. That is wholly different to bankruptcy, and that is why my hon. Friend the Member for Beaconsfield, the hon. Member for Lewes and I are making this point.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

Credit checks are not 100 per cent. accurate, and nor is an assessment of criminals with a criminal lifestyle. If one considered the Kray twins, one might gradually have come to the conclusion that they might just be involved in a wee bit of work that was not absolutely legal.

Norman Baker (Liberal Democrat, Lewes)

One might have reached that conclusion with the Kray brothers, but I hope that, as a result of the Bill, people who have hitherto been regarded as respectable pillars of society will be identified and that the proceeds of their crime will be taken away. Individual small traders who deal with them are also regarded as respectable. We do not want to weaken the Bill, but we want to ensure that no further innocent victims are created.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

I had better go on, because some of those questions will be answered during the discussions.

Other third party interests also receive protection elsewhere in the Bill. Persons with secured interests will be able to recover them. A typical example is a person with an outstanding mortgage. In such a case, it would be open to the mortgage company to apply for a variation or a discharge of a restraint order under clause 43(3) to recover his debt. There is also provision for such interests to be taken into account if a receiver is appointed and at the realisation stage of a confiscation order.

Secured creditors are also protected under the legislation by the legislative steer in clause 69(3)(a), which states that the powers of the court and receivers

``must be exercised with a view to allowing a person other than the defendant or the recipient of a tainted gift to retain or recover the value of any interest held by him''.

The only issue is whether unsecured creditors should take priority over the settlement of the confiscation order. We believe that they should not. If all debts were given priority over confiscation, there would be two undesirable consequences. First, defendants could acquire services on credit to defeat the confiscation process. That would mean that the available amount was reduced and the court would have to make a lower confiscation order against the defendants than would otherwise be possible, which would be a very effective means of evading confiscation. The kind of people that we are talking about would make such arrangements deliberately to evade confiscation.

Mr. Grieve rose—

The Chairman Order. Before I call the hon. Gentleman, I point out that if hon. Members want a clause stand part debate, interventions may count as part of it. The interventions thus far have been on the principle of the clause rather than a specific amendment.

Dominic Grieve (Conservative, Beaconsfield)

I understand what the Minister said and I appreciate that that is a potential problem but drafting surely would not go a long way towards curing that problem. I have two points to make. First, would it be possible to set a date within or outside of which the debts would not be given preferential treatment, thereby preventing defendants from using the situation when they knew that proceedings were to be brought against them? That seems perfectly practical. Secondly, I do not accept the Minister's point—I hope that he will respond to this—that debts from the unsecured creditor, such as the shopkeeper who provides credit, could be used by defendants in the way he suggests. Those categories can be identified.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

I will come to specific categories in a moment. It worries me that the hon. Gentleman is again arguing the criminal's case.

Dominic Grieve (Conservative, Beaconsfield)

No.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

Well, he is, because the criminals we are talking about employ not only competent solicitors and advocates such as the hon. Member for Surrey Heath (Mr. Hawkins), but competent accounts. The more loopholes that we provide, the more those accountants will say, ``Look, if you acquire services on credit in such a way, you can reduce your allowable amount effectively to evade having to pay.''

Dominic Grieve (Conservative, Beaconsfield)

I think that the Minister may have misunderstood. That problem can be met by drafting, not simply by the amendment. I am talking not about reducing the amount that one has to pay the state in order to pay a defendant's creditors but about the state taking it upon itself to reimburse bona fide creditors when it has recuperated cash.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

I will come to some of the problems. I am saying merely that we are talking about the available amount. Anything that enables the criminal or those acting on his behalf to find ways of reducing that amount would undermine the Bill. It might be possible to prevent that by excluding from protection debts acquired after the commencement of criminal proceedings but that would not assist in cases in which the defendant had earlier begun evasive action—as he would—after becoming aware that he was under investigation. As soon as a defendant was under investigation, he would start salting away some of his money to ensure that the available amounts would be reduced.

Nick Hawkins (Conservative, Surrey Heath)

The Minister must understand that the amendment is not designed to enable any drug dealer to salt away anything. As my hon. Friend the Member for Beaconsfield said, we want all the defendant's assets to be seized, but not at the expense of the entirely innocent third parties. There must be a way to do that.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

I shall come to some of those points in a moment. As the Chairman said, we are having a clause stand part debate and covering points that are not directly relevant to the amendment.. Defendants would produce a list of phoney creditors, claiming to have prior debt outstanding against them. In reality, those individuals would be the defendant's criminal associates—the hon. Member for Surrey Heath is shaking his head, but that is exactly what happens. Such associates are the so-called straw men whom we already see deployed in attempts to frustrate the operation of legislation on the proceeds of crime. That action would be difficult to prevent and would greatly weaken the confiscation system.

Mark Field (Conservative, Cities of London and Westminster)

That is arrant nonsense. It is unbelievable that the police, other regulatory authorities or the new, wonderfully powerful Assets Recovery Agency would not have the power to investigate more thoroughly. The reality is that an investigation in which confiscatory powers come into force would be an enormous operation involving the police and the director of the Assets Recovery Agency. Bank accounts of associates and all transactions going back six years would be looked at in great detail. The idea that somehow the amendment would give licence to a handful of people to salt money away into private accounts is nonsense.

George Foulkes (Labour/Co-operative, Carrick, Cumnock and Doon Valley)

The hon. Gentleman must admit that the amendment would provide an extra opportunity to set up phoney creditors, which would make it much more difficult for the investigating authorities to find information.

On Second Reading, my right hon. Friend, the Minister for Police, Courts and Drugs touched briefly on the issue of property subject to a restraint order. He indicated that such orders could be varied to allow a builder to recover debt, for example. To avoid any doubt, I should explain the position in more detail. The legislative steer in clause 69 has the effect that the confiscation process takes precedence over unsecured debts. A restraint order prohibits the payment of any debt, secured or unsecured, without the leave of the court. It can be varied by the court to allow a secured creditor to recover an interest in property but, in the light of the legislative steer, it cannot be varied to allow the payment of an unsecured debt unless that is necessary to maintain the value of the property under restraint. I hope that that clarifies the position outlined on Second Reading.

The rest of the debate is in Hansard.