Proceeds of Crime Bill

Public Bill Committee, 31 January 2002.

Standing Committee B

Clause 420 - Use of information by director

Dominic Grieve (Conservative, Beaconsfield)

We have tabled many amendments to the clause, almost all of which probe into how it is expected to work. The clause states:

Information obtained by or on behalf of the Director in connection with the exercise of any of his functions may be used by him in connection with his exercise of any of his other functions.

That is a strange statement. I think that I understand it, but will the Minister clarify it for the Committee?

Nick Hawkins (Conservative, Surrey Heath)

When I looked at the clause, I was reminded of the excellent destruction by my hon. Friend the Member for Henley (Mr. Johnson) of a regional development agency job advertisement in The Daily Telegraph this morning. The clause contains similar gobbledegook for the layman. Anything that is as circular in its phraseology has no place in legislation.

Bob Ainsworth (Labour, Coventry North East)

That all circularity should be removed from legislation is a revolutionary thought. I have discussed enough Bills to know that that would have a profound, far-reaching effect. The wording of advertisements designed for the public is different from that used in legislation.

Paul Stinchcombe (Labour, Wellingborough)

I am struggling to understand how the clause can be described as circular. It says that the director may use the information that he has obtained. That is not circular.

Bob Ainsworth (Labour, Coventry North East)

I shall not try to justify the statement of the hon. Member for Surrey Heath (Mr. Hawkins). It does not hold water, but I doubt whether that will bother him unduly, given that he has been in that situation on many occasions.

For the director to be able to carry out his functions effectively, he will need to be able to exchange information with other bodies with which his functions overlap. For example, if he is to assist the law enforcement and prosecution authorities in a criminal confiscation investigation, he will need to be able to receive information from those authorities. If he uncovers information in a civil recovery investigation that might be relevant to a prosecution, he will need to be able to disclose it to the police.

Part 10 sets out the gateways that will allow the exchange of information and the uses to which the information obtained may be put. Clauses 420 to 423

set out the necessary provisions in respect of the director. Clauses 424 to 427 make equivalent provisions in relation to the Lord Advocate and Scottish Ministers. Clause 420 establishes that the director will be able to use information obtained in connection with any of his functions to assist him in the exercising of his other functions. That will mean that he will be able, for example, to use information obtained in the course of a criminal confiscation investigation subsequently to take forward a civil recovery case, if that is the route down which he wants to go, or information obtained during a civil recovery investigation in a subsequent tax case.

That will ensure that the director is not required to reobtain information simply because he is considering bringing proceedings under a different part of the Bill. That will apply whether he obtains information himself or, as is more likely, it is obtained by one of the agency staff on his behalf. The director will be required to exercise his functions in accordance with guidance issued by the Secretary of State under part 1. He will also have regard to the detailed memorandum of understanding that will be drawn up between him and the prosecution and law enforcement agencies.

Alistair Carmichael (Liberal Democrat, Orkney and Shetland)

Will the Minister clarify whether the provision will exclude other people from using information that has been obtained by the director of the Assets Recovery Agency? If the director were to obtain information that could constitute grounds for criminal proceedings, would he be able to pass that information to the Crown Prosecution Service?

Bob Ainsworth (Labour, Coventry North East)

As we go through the Bill, we will come to the provisions under which the director will be able to pass information to other people. Some time ago, in our discussions on part 1, we talked about the guidance that was planned by the Secretary of State and the hierarchy that we envisaged within that. In general, the Committee approved of the hierarchy and agreed that confiscation should not take precedence over the prosecution of criminals. Let us suppose that the director comes across information during a confiscation proceeding that leads him to believe that a prosecution is appropriate and viable, but he is unable to bring a prosecution himself. In those circumstances, he should be able to pass on the information to the prosecution authorities for their consideration.

Under the clause, if information comes to the director under one part of his powers, he should be able to use it under other parts of his powers. It reinforces the ability to use the hierarchy. If, during civil recovery proceedings, he comes across information that leads him to believe that there is a case for prosecution, there is no point in his not being able to co-operate with the prosecution authorities, which might subsequently consider criminal confiscation. If he finds that a criminal confiscation is not viable, there is no need for him to regain all the information that has been passed to him before he is able to consider civil recovery proceedings.

The director will be able to apply the information to both criminal confiscation and civil recovery. I think

that the matter is clear. I do not see the confusion that was suggested by the hon. Member for Surrey Heath.

David Wilshire (Conservative, Spelthorne)

It is a bit early in the morning to get my mind around whether or not the argument is circular. The Minister has argued that the provision is necessary, but I am not convinced that it is. If it were necessary to state that the director can use information, should we not also say that he can make phone calls, write letters and take holidays? Where does it end? If the intention is to state what the director can and cannot do, the Bill must be consistent in that. If the director has to have a meeting—for which he does not have permission—are we to assume that he will be unable to use any information gained from that meeting? Inconsistency, not circularity, is my worry.

Another worry is about the singling out of information. Why is the word ''information'' used? What is the difference between information and knowledge? If someone knows something, does it constitute information? Someone who knows something cannot unknow it. There is therefore no point in specifying in a Bill that having discovered something it should be possible to unlearn it, unless another clause specifies that a person is entitled to remember it. When is information not information? Can evidence obtained for one purpose be used for another? If the clause means evidence rather than information, why does it not say so?

Why is the provision necessary? The director may and may not do many other things. If we list one, we should list them all. Why single out information? What is information? The Minister should say what he means by ''information obtained''. Is it evidence? Is it knowledge? Is it property?

The Minister referred to the need to reobtain information. That is unnecessary, too. Once someone has information, why do they need to reobtain it? If they have been told something, they do not have to ask to be told again.

I have not been persuaded. The Minister made a good job of reading out his brief early in the morning, but unfortunately it does not go anywhere near justifying—

Steve McCabe (Labour, Birmingham, Hall Green)

How much longer can you go on about this?

David Wilshire (Conservative, Spelthorne)

Quite a bit longer, if pushed. I apologise, Mr. Gale. It is early—

Bob Ainsworth (Labour, Coventry North East)

Not as early as it was.

David Wilshire (Conservative, Spelthorne)

Indeed. The sun will have moved to another window before we get much further.

Why must the Minister single out information, and not other things? Why does he pick information, rather than knowledge, evidence, property or something else? Why does he need to mention reobtaining something? Is he forgetful? Must he obtain information again? I do not think that that is true of many people. He must briefly deal with those anxieties, too.

Paul Stinchcombe (Labour, Wellingborough)

Let me deal with a couple of the hon. Gentleman's points. First, the power is necessary because the director can do only what Parliament empowers or obliges him to do. Clearly he will receive information, and we must specify what he can do with that information. Secondly, the word ''information'' is presumably used because it is used elsewhere in the Bill. For example, in clause 346 we created disclosure orders under which information will be provided.

Nearly all the endless speeches that the hon. Member for Surrey Heath makes are prefaced by a great tribute to his own legal experience and expertise. It seems appropriate to apply at least some forensic legal analysis to the clauses that he criticises. He states that the provision is circular. It is clearly not. It is exclusively linear. It provides that information received by the director may be used by the director and directs our attention to how that information must come to him and how he may use it. It uses the words

in connection with the exercise of . . . his functions

in both cases. That is perfectly clear.

The issue raised by the amendment that has not been selected focused entirely on the words

in connection with the exercise of . . . his functions,

and was intended to clarify only whether that was too narrow or too broad and how wide its remit was. It was not intended to criticise the provision's apparent circularity, which is non-existent.

Boris Johnson (Conservative, Henley)

I accept the hon. Gentleman's point that the clause is linear, but it is none the less otiose and unnecessary. I cannot understand why Parliament feels it necessary to inform the director that information that he obtains in the course of his functions may be used in connection with his functions. What kind of a man is this director who is so silly as not to assume that information obtained in the course of his functions may be used in connection with those functions? What—

Roger Gale (Conservative, North Thanet)

Order. I remind the hon. Gentleman that he is making an intervention, not a speech.

Paul Stinchcombe (Labour, Wellingborough)

Let me give the hon. Gentleman a small lesson in public law. When Parliament creates posts such as the director's, it must tell the postholder exactly what he can and cannot do. The director can act only in accordance with Parliament's directions. He can exercise only the powers and duties that we give him. Powers and duties make up his functions. He can perform those functions only for the purposes for which we empower him to do so.

Nick Hawkins (Conservative, Surrey Heath)

Will the hon. Gentleman give way?

Paul Stinchcombe (Labour, Wellingborough)

If the hon. Gentleman will forgive me, I shall not give way. I want to finish my answer to the hon. Member for Henley.

That informs the doctrine of ultra vires. If the director acts outside the four corners of the powers and duties that we have created, he exercises them unlawfully and can be challenged by judicial review.

That is why we have to give him the powers, and why we are giving them in this clause.

Nick Hawkins (Conservative, Surrey Heath)

The hon. Gentleman is, as he puts it—some might say charmingly, and others patronisingly—giving a lesson in public law to my hon. Friend the Member for Henley. Will he use his enormous expertise in public law to tell me whether, in his understanding of the doctrine of statutory interpretation, if the clause did not exist, other clauses in the Bill would be considered and the statute would be interpreted to mean that the director could use his powers as the clause suggests?

Paul Stinchcombe (Labour, Wellingborough)

It is a tremendous pleasure to get a lesson in patronisation from the hon. Gentleman, who is clearly an expert on the subject. I am more than willing to enter into a debate on our respective reputations and experience in public law.

The courts might interpret the statute to imply that the director can use the information. However, it seems to me that there is no problem in making that clear, particularly as we can thereby clarify precisely how the information would come to him and how he might use it. That is why the words

in connection with the exercise of any of his functions

are so vital. They set the threshold and parameters for both those points.

Alistair Carmichael (Liberal Democrat, Orkney and Shetland)

I hesitate to enter into the debate, which seems to have lost some of the niceness that we have enjoyed until now. As a Liberal, that is something I deeply regret.

I hope that the Minister will explain what the clause adds to clause 2(3), which says:

The Director may do anything (including the carrying out of investigations) which he considers is—

(a) appropriate for facilitating, or

(b) incidental or conducive to,

the exercise of his functions.

I do not believe that the clause adds anything to that.

My primary concern is that many of the powers that we gave to the director of the Assets Recovery Agency were swingeing powers, but they were not going to be used for criminal prosecutions. However, now we learn that there is a danger that prosecution could be introduced by the back door. I commend to the Minister the introduction of an interpretation of the clause that states that that should be an exclusive power.

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

Could the hon. Gentleman clarify why it is a danger that evidence of criminal behaviour might be passed on to the prosecutor so that action can be taken? I should have thought that we were in favour—

Roger Gale (Conservative, North Thanet)

Order. No, he could not, because that would not be in order.

Alistair Carmichael (Liberal Democrat, Orkney and Shetland)

I take your guidance on that, Mr. Gale. I suspect that we should more properly debate that under clauses 423 and 424.

David Wilshire (Conservative, Spelthorne)

I want to thank the hon. Member for Wellingborough (Mr. Stinchcombe). In all my life, whenever I have asked a lawyer to explain something,

I have received a whopping great bill. On this occasion, I received some very useful free information from a lawyer and it would be unkind not to acknowledge that. I assume that he fears that the Minister may fall down the stairs and be indisposed. If such a thing happened, the Whip would remember that the hon. Gentleman had given me a good answer to my questions. Perhaps it was a bid in the—we hope—unlikely event that the Minister should come to grief.

Bob Ainsworth (Labour, Coventry North East)

What on earth is in the tea this morning? The first point was covered by my hon. Friend the Member for Wellingborough. The director will not be as he is viewed by the hon. Member for Henley, who asks what kind of man he is.

Boris Johnson (Conservative, Henley)

Or woman.

Bob Ainsworth (Labour, Coventry North East)

He or she is effectively a statutory body and cannot behave as a citizen, being able to use only the powers that we give him or her. A local authority acting outside the powers conferred on it by an Act of Parliament would be acting ultra vires. The same would apply to the director. We must define what the director can and cannot do and not assume that he or she has a particular power.

The other point that hon. Members have overlooked concerns the provisions of the Data Protection Act 1998, which says that information passed may be used only for the purpose specified. If we do not say specifically that the director can use information for his other functions, he could fall foul of the Data Protection Act. The clause is necessary to enable the director to do the job in a legal fashion.

Dominic Grieve (Conservative, Beaconsfield)

I had not foreseen what a Pandora's box I would open. I stood up to initiate a debate on the clause, and suddenly we have heard the cats meow. It may be that, as we approach the end of our proceedings, there is a sudden urge to express feelings that have been building up for a long time. My only regret while listening to the hon. Member for Wellingborough was that he did not comply with the civil procedure rules and provide us with a skeleton argument beforehand. We would then have been better informed.

However, I am grateful to the hon. Gentleman for his contribution, and to the Minister for his explanation of what is an important issue, which we will develop as we examine part 10. I am grateful to him for amplifying the bare words that do, on the face of it, give rise to comment.

Question put and agreed to.

Clause 420 ordered to stand part of the Bill.

Roger Gale (Conservative, North Thanet)

Before we proceed, I wish to explain to the hon. Member for Glasgow, Pollok (Mr. Davidson) that I ruled him out of order because the points that he sought to raise were not covered by clause 420. I am sure that he could find a suitable opportunity in our debate on the remaining clauses, should he so wish.

Clause 421 - Disclosure of information to director

Dominic Grieve (Conservative, Beaconsfield)

I beg to move amendment No. 625, in page 244, line 16, at beginning insert—

'Except as provided for in subsection (3) below,'.

Roger Gale (Conservative, North Thanet)

With this we may discuss amendment No. 635, in page 246, line 20, at beginning insert—

'Except as provided for in subsection (8) below,'.

Dominic Grieve (Conservative, Beaconsfield)

The clause provides for the disclosure of information to the director. Subsection (1) says:

(1) Information which is held by or on behalf of a permitted person

as defined in subsection (5),

(whether it was obtained before or after the coming into force of this section) may be disclosed to the Director for the purpose of the exercise by the Director of his functions.

(2) A disclosure under this section is not to be taken to breach any restriction on the disclosure of information (however imposed).

(3) But nothing in this section authorises the making of a disclosure—

(a) which contravenes the Data Protection Act 1998 (c.29);

or

(b) which is prohibited by Part 1 of the Regulation of Investigatory Powers Act 2000 (c23).

The amendment is designed to probe what will remain restricted, and what will be allowed to be disclosed. I want the Minister to explain what the two subsections will—and will not—allow to be disclosed.

Bob Ainsworth (Labour, Coventry North East)

Subsection (2) states that a disclosure of information to the director, under the gateway that the clause provides,

is not to be taken to breach any restriction on the disclosure of information.

That is an important statement, with regard to the operation of the information gateways that the Bill provides.

Subsection (3) inserts a rider to subsection (2), stating that the clause's provisions do not authorise a disclosure that contravenes the Data Protection Act 1998, or part 1 of the Regulation of Investigatory Powers Act 2000. The provisions are not intended to override those that already exist in data protection legislation and with regard to intercept material. An identical provision is made in clause 423, with regard to disclosures of information by the director.

As the Bill does not allow any disclosure to be made that is incompatible with the provisions of those Acts, the amendment would be superfluous: it would merely draw explicit attention to subsections (2) and (3), and to subsections (7) and (8) of clause 423.

Although I appreciate that hon. Members want the legislation to be clear, there is no scope for confusion on the point that has been raised. The Bill is lengthy, and we should not add to it unnecessarily.

David Wilshire (Conservative, Spelthorne)

I apologise to the Minister in advance, if my remarks make me sound like the hon. Member for Glasgow, Pollok.

During the Committee's proceedings, my hon. Friends and I have occasionally proposed restrictions

and limitations, and we have been told that we are being soft, and that we are trying to prevent the director from getting what he wants. However, if I correctly understand the Minister's comments, he is now proposing to impose restrictions on the director's powers. Would that not weaken the Bill? Why is he asking us to make concessions with regard to privacy and protection, when previously he has castigated us for asking for that?

Bob Ainsworth (Labour, Coventry North East)

That is not quite the case. We are merely making it clear that the Bill does not override the assurances that are given in, for instance, the Regulation of Investigatory Powers Act 2000, and those that Parliament wanted with regard to how intercept material can—and cannot—be used. It is important to make it clear that we are not seeking to undermine the safeguards that other legislation provides.

Dominic Grieve (Conservative, Beaconsfield)

I am grateful to the Minister for his remarks. The amendment was merely intended to stimulate discussion. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Nick Hawkins (Conservative, Surrey Heath)

I beg to move amendment No. 602, in page 244, line 22, leave out subsection (4).

My comments on the amendment need only be brief. As my hon. Friend the Member for Beaconsfield (Mr. Grieve) has said, we merely wish to probe the Government on several matters relating to part 10. If I suggest that subsection (4) does not need to be in the Bill, I may provoke further responses from Government Back Benchers. However, I was puzzled about whether it was necessary for the Bill to contain a subsection that states:

This section does not affect a power to disclose which exists apart from this section.

If the subsection were not present, why would the powers to disclose that exist apart from those in the clause be affected? The subsection is otiose, and could be deleted to shorten the Bill.

Dominic Grieve (Conservative, Beaconsfield)

I am always a tiny bit suspicious when I see a provision of this kind in a Bill, because my first reaction is to wonder what we are considering. What are the powers to disclose that exist, apart from those in the clause, that will not be affected? Until one knows what those are, one gets the slight impression—perhaps the wrong impression—that something that the Committee should take into account is being slipped in through the back door.

Will the Minister identify what was in the draftsman's mind when subsection (4) was formulated? What are the current circumstances in which the Minister can cite powers to disclose that would not be affected by the clause, or does he envisage that such powers might be created? In that case, I do not see the need for it, because if such powers were created, that would override the provision. It would be helpful for the Committee to know what is going on.

David Wilshire (Conservative, Spelthorne)

I echo what my hon. Friends have said. I, too, am always suspicious of a provision that

suggests that notwithstanding powers in a clause, anything can be done.

I looked at the explanatory notes, and they contain no reference to what the powers may be. If the Minister does not have a list of the powers that exist at present, I hope that he will send one to us so that we may consider it. If we know what the powers are, we may wish to say on Report that several of them should not be used in these circumstances. During a previous debate, he defended the right to exclude certain measures, so we have established that some things are excluded from disclosure. We must find out what else he has in mind.

Boris Johnson (Conservative, Henley)

It seems to me that the powers to disclose that may be adumbrated by the clause might be rather wide. All journalists have a power to disclose. Would that be excluded? Exactly what are we talking about?

David Wilshire (Conservative, Spelthorne)

I assume that my hon. Friend hoped that I might be able to give him an answer, because he intervened on me rather than on the Minister. However, I am speaking because I want an answer. I hope that my hon. Friend will forgive me if I do not attempt to answer him, although I am sure that the Minister noted what he said and will reply to him.

The Government have listed at least two things that are excluded from the process without any pressure from us. However, they now say that anything else can be used. Somebody must have researched the other powers that could be used, and we ought to know them. We must be satisfied that we are not letting through all sorts of powers to which we would object.

I am worried—I appreciate that this is not immediately to the point, but it may be a matter for the stand part debate—by the impact of the restrictions placed on disclosure by the Human Rights Act 1998. That is not mentioned in the clause, but we must consider those restrictions. I am sure, Mr. Gale, that you will rule on whether that is a matter for a further amendment or for a stand part debate.

Bob Ainsworth (Labour, Coventry North East)

The clause allows the director to receive information from any number of permitted persons, who are listed in subsection (5), for the purpose of exercising his functions. However, other information disclosure gateways may exist that allow persons to disclose information to the director. Subsection (4) clarifies that the clause does not affect such gateways. The amendment would remove subsection (4). That might imply that the clause meant that information could be given to the director only for the purposes listed, regardless of any other statutory provision.

We did not have specifics in mind. The subsection is a standard measure, and it is the reverse of what we have just discussed. When we pass legislation, there is a requirement to ensure that it does not cut across safeguards in other legislation. It was necessary to provide that the clause does not cut across any safeguards in the Regulation of Investigatory Powers Act 2000, or provisions in other legislation that allow other bodies to disclose information. If that is allowed, it will continue to be allowed. If safeguards have been

built into other legislation, such as the Data Protection Act 1998 and the Regulation of Investigatory Powers Act 2000, they are not done away with by the clause.

Dominic Grieve (Conservative, Beaconsfield)

I understand the Minister's point, but in light of our discussion on clause 420, it is surprising. The hon. Member for Wellingborough said that we are defining carefully the powers that are provided to the director by statute. However, when exercising those powers, he may receive any information that does not contravene the Data Protection Act 1998 or the Regulation of Investigatory Powers Act 2000. However, subsection (4) says:

This section does not affect a power to disclose which exists apart from this section.

The Minister said that he does not know of such a power that would cause a problem, so I do not know why the subsection is present. If subsequent legislation introduces a power, that should be done explicitly. I do not like introducing a measure that is an opening for future disclosure without giving it proper consideration, especially because the Bill defines the director's powers so closely.

Bob Ainsworth (Labour, Coventry North East)

As I told the hon. Gentleman, the provision is standard. It could apply to subsequent legislation or to abilities that are in past legislation. It is included to ensure that we are not removing the right to disclose information that is granted to other people. I do not understand why the subsection is attracting such controversy.

David Wilshire (Conservative, Spelthorne)

I rise only because the Minister sat down without offering a list of the powers or telling us what they are. We are asked to sign a blank cheque, and I do not like that. I press him to tell us what the powers are now, or inform us later.

Paul Stinchcombe (Labour, Wellingborough)

The hon. Gentleman makes an interesting point. However, if the powers exist, they exist anyway, and the blank cheque will already have been written.

David Wilshire (Conservative, Spelthorne)

That may be so. However, I am not a lawyer and perhaps I do not pay as much attention to these matters as I should. Perhaps I should have spotted that and tabled a different amendment. [Interruption.] There seems to be a glorious conference going on. We may get further free advice from another quarter.

The hon. Member for Wellingborough has alerted us that we should have asked these questions. The Minister told us that the powers exist, but if he had said nothing, we might not even have seen the blank cheque. He has drawn it to our attention, and as the Opposition we are entitled to ask him to explain it now, or in writing. I make no apologies for raising the point. We have information to show that there are other powers. If I were a lawyer, I might know the answer to my question. I am not a lawyer, but I am a Member of Parliament, and as such I am entitled to ask the question and to receive an answer.

Dominic Grieve (Conservative, Beaconsfield)

It slightly troubles me that the whole tenor of our discussions is based on the fact that the director will receive information from the permitted persons for the discharge of his functions. We have thoroughly debated where the information will be

coming from and for what purpose. I appreciate that draftsmen want failsafe clauses: it is a belt-and-braces job, so in goes subsection (4). The Minister said that, in view of the novel powers of the director, they will be kept under strict control. However, given the restrictive nature of what the director is supposed to be doing, either there is nothing that requires the application of subsection (4) or I would have expected someone to know what subsection (4) is intended to facilitate.

In fairness to the Minister, if there were something else that the subsection was intended to facilitate, I am sure that he would have told us. That is a good argument for the removal of the subsection: it is otiose and will facilitate nothing. If, in future, something is to be facilitated, I expect it to be spelled out. I am worried that subsection (4) will enable a measure to come into operation that provides a channel of information to disclose to the Minister, without Parliament knowing about it. That is my concern in a nutshell.

Boris Johnson (Conservative, Henley)

The devil may lie in ''exists''. That the word is used in its present tense worries me. When this thing becomes statute, I wonder whether ''exists'' will be taken to mean as matters exist now when we are agreeing to the terms of the Bill or whether it will cover all time and future legislation on the powers of disclosure. I hope that my hon. Friend sees my point.

Dominic Grieve (Conservative, Beaconsfield)

I see my hon. Friend's point absolutely. It will cover any such power that comes into operation during the existence of the Bill, when enacted. That is why I am concerned about the subsection. I expect to see spelled out in future legislation that it is amending the Proceeds of Crime Act, whereas such action could be taken without any amendment, which would mean that a future Committee may not be aware of how such an amendment would impact on the director's powers.

Bob Ainsworth (Labour, Coventry North East)

I am not trying to con the hon. Gentleman or hold back information. It is a standard provision. It is not in the Bill to enhance the director's abilities but to ensure that nothing in the Bill cuts across powers that have already been given to other people. The provision is found in other legislation. It covers future legislation under which Parliament has chosen to give powers to people to disclose information. The power will not be nullified by the Bill when enacted, and we would not have to check that it will have to be amended to give those powers under future legislation.

There is existing legislation under which powers to disclose information have been specifically given to people. It is not our intention under the Bill to nullify such powers. I do not have a list of the powers that have been trawled around. I am sorry if I have offended the hon. Member for Spelthorne (Mr. Wilshire), but I am told that it is a standard provision. We have added in the necessary safeguards in respect of the Data Protection Act 1998 and the Regulation of Investigatory Powers Act 2000. We have provided a standard provision to ensure that we are not nullifying the powers that we

have given, or might give, not to the director but to other people.

Nick Hawkins (Conservative, Surrey Heath)

We are not satisfied with what the Minister says. I moved the amendment expecting the Minister to give us a far more thorough answer. We are sceptical, as my hon. Friends have said.

Paul Stinchcombe (Labour, Wellingborough)

As the hon. Gentleman is not satisfied to leave in the subsection, which powers to disclose does he want the section to cut across?

Nick Hawkins (Conservative, Surrey Heath)

With great respect to the hon. Gentleman, he has missed the point. We are criticising the Minister's inability to give us any examples of the existing powers that he says the provision would cut across. It is for the Government to say what the powers are, and the Minister has apologised for not being able to list them.

Paul Stinchcombe (Labour, Wellingborough)

If those powers exist, they were created by Parliament in accordance with its democratic will. The provision, it is thought, might cut across some of those powers. We do not wish to do that. Which powers created by Parliament does the hon. Gentleman wish to cut across?

Nick Hawkins (Conservative, Surrey Heath)

As I have already said, as the Minister cannot give us a list, I do not understand how the hon. Gentleman can expect a list from the Opposition. Whether or not there are any such powers—

Bob Ainsworth (Labour, Coventry North East)

Or may be in the future.

Nick Hawkins (Conservative, Surrey Heath)

Yes, or may be in the future, the subsection may provide a blank cheque. If the subsection has any effect, we are suspicious about it. If it does not, it should not be included.

David Wilshire (Conservative, Spelthorne)

I wonder whether my hon. Friend will reflect on the fact that there appears to be a difference of philosophy between the Government and the Opposition. Government Members are saying the exact contrary of what I believe, which is that no power should be granted unless we give it. That view is being challenged by the implication that the authorities should have all the powers that they need unless we take them away. I hope that my hon. Friend agrees that we are arguing that we should give the power, rather than take it away.

Nick Hawkins (Conservative, Surrey Heath)

I could not agree more. This is another example of the new authoritarian tendency of the Labour Government. We, as good Conservatives, want to be statutory minimalists.

Bob Ainsworth (Labour, Coventry North East)

If what the hon. Gentleman for Spelthorne said were correct, that would be true, but we might want to give those powers in future legislation, and the subsection makes us free to do so. We are not giving a blank cheque; we are opening up the potential for Parliament to give those powers in the future and, as my hon. Friend the Member for Wellingborough says, we are not cutting across those that Parliament has already given.

Nick Hawkins (Conservative, Surrey Heath)

There is a danger that the debate will go round in circles. As no Parliament can bind its successors, and as any future Act of Parliament, as my hon. Friend the Member for Beaconsfield said, will

create its own powers, we are entitled to be concerned that the Government have introduced the provision. For that reason, I shall press the amendment to a Division.

Question put, That the amendment be made:—

The Committee divided: Ayes 6, Noes 13.

Dominic Grieve (Conservative, Beaconsfield)

I beg to move amendment No. 603, in page 244, line 29, leave out paragraph (e).

Roger Gale (Conservative, North Thanet)

With this it will be convenient to take amendment No. 614, in clause 425, page 247, line 16, leave out paragraph (e).

Dominic Grieve (Conservative, Beaconsfield)

An issue that has arisen in our consideration of the Bill is the interrelationship between the director's powers and the functions of the Inland Revenue. We considered the issue in discussing the director's taxation powers, which clearly have a bearing on his use of information from the Inland Revenue and disclosure of information to the Inland Revenue. As the Minister acknowledged when we considered the matter, it is accepted practice that communication between an individual and the Inland Revenue is in confidence. Only in very limited and restricted circumstances has the Inland Revenue breached that confidence or felt that it should disclose information.

The amendment would delete the reference to the Commissioners of Inland Revenue being a permitted person. It is a probing amendment, designed to stimulate debate about exactly how the provision will work in practice. That applies in several places in the clause. It is probably one of the most important issues to arise in our consideration of this part of the Bill. I should be grateful if the Minister would identify the criteria under which the commissioners of Inland Revenue will act in disclosing information to the director that is likely to have been obtained in confidence through a confidential relationship with a taxpayer. That is an important issue that we cannot simply pass without careful consideration. However, I recognise that the operation of the Bill will be impossible unless the Inland Revenue is a permitted person, so I shall not press to the amendment to a Division.

Bob Ainsworth (Labour, Coventry North East)

As the hon. Gentleman said, the amendment would prevent the Inland Revenue from disclosing information to the director for the purpose of exercising his functions. That would fundamentally undermine the director's ability to perform his taxation functions under part 6. To perform

effectively, he will need information from the Revenue about the tax history of the subject of his inquiries. He will need to know what tax the person has paid and in which tax periods, and to have access to much of the case information that the Inland Revenue has. That information will help the director establish the subject's true tax liability and will inform his decisions about raising a tax assessment.

When we considered part 6, I gave assurances about the director collecting only tax that is properly due. He will not raise tax assessments on income or gains already taxed by the Revenue. Without information from the Revenue, that assurance could not be maintained.

Amendment No. 614 would prevent the Inland Revenue from being able to disclose information to the Lord Advocate or Scottish Ministers. Although the Lord Advocate and Scottish Ministers will not carry out taxation functions under part 6, information that the Inland Revenue holds will be of use to the Lord Advocate and Scottish Ministers in performing their functions under parts 3 and 5 respectively. The amendment would prevent them from having access to the information and would hinder their ability to perform accordingly. Because the director has access to taxpayer information when he performs equivalent functions in the rest of the United Kingdom, it would create an inconsistency if the Lord Advocate and Scottish Ministers did not have such access for cases in Scotland.

Dominic Grieve (Conservative, Beaconsfield)

That is an interesting point. I realise why there is a different system north and south of the border. However, every time I hear the words ''Scottish Ministers' taxation functions'' my hackles rise at the prospect, even though those Ministers may not personally perform the taxation function. It is interesting that Ministers will take ultimate decisions because of the way in which the framework will work, which would not happen south of the border. That raises a political issue that we should consider.

Bob Ainsworth (Labour, Coventry North East)

As I said, the Lord Advocate and Scottish Ministers cannot carry out taxation functions under part 6, and will not do so. I do not want to get into an argument with the hon. Gentleman, as I am not qualified to say whether the Scottish system is better than the English one, or whether the Scots are entirely satisfied with our system, or we with theirs. That is beyond the scope of the discussion on the amendment.

The position under the amendment would also be at odds with section 19 of the Anti-terrorism, Crime and Security Act 2001, which provides, notwithstanding any secrecy provisions in other legislation, that the Revenue can pass on information to anyone to help the intelligence services, and for the purposes of criminal investigations and proceedings.

We discussed why we structured the Bill as we did. With regard to the director's taxation functions, he will, in effect, stand in the shoes of the Revenue, as I said in a previous debate. He will therefore be entitled to information that the Revenue holds. We thought that that was better structurally than giving the Revenue the additional powers and expecting it to

do the job of taxation, which we are giving the director. If we do not want to create two separate taxation systems, and a potential leaking of new and additional powers to areas of ordinary taxation where criminal assets are not being pursued, it is self-evident that it would be dangerous to go down that route.

The hon. Gentleman is right that the director will have access to taxation information from the Revenue, but only in cases where he is justified in doing so. We have discussed the hierarchy, and are talking about people against whom criminal investigations, criminal confiscation, civil recovery or recovery of the proceeds of crime are being considered. Access to taxation information is justified in those cases.

David Wilshire (Conservative, Spelthorne)

I wanted to raise several matters, but the Minister said two things that concern me and raise additional issues. If I heard him correctly, he referred to raising tax assessments. There may have been occasions during the proceedings when I was not here or not listening carefully, or both, but I was not aware that we were creating another sort of tax inspector. If he said what I thought he said, we now have a system whereby the director is supposed to be raising tax assessments. If that is the concept, I find that extraordinary, as it runs counter to the Bill's real purpose, which is about removing the proceeds of crime. If the director is going to use the information from the Commissioners of Inland Revenue to raise tax assessments, he is taxing the proceeds of crime, not confiscating them.

That is a peculiar departure from what I thought this legislation was about. Taxing something makes it legitimate; it is saying, ''You can keep it but you'll pay 35 per cent tax on it.'' Is the Minister suggesting that this clause is there to provide an alternative tax collector? Is the director going to be a tax inspector in his own right? I would be amazed if many Committee members had seen that point before now.

I understood from the beginning that this legislation was about confiscation, not taxation. If at this late stage we are going to say that this is a tax raising activity rather than a confiscation of the proceeds of crime activity, we should be debating whether the director is the right person to levy taxes. The Minister triggered that thought so he should explain what he has in mind before we proceed further.

The second of the Minister's remarks to trigger my concern was that the director would obtain information on request. Nowhere in the clause is it stated that information is obtained when the director asks for it. I would have assumed that the permitted persons might of their own free will decide that they had useful information. The Minister's justification was that the director would make a request for information. If that is the case, it should be made clear. The clause does not state whether permitted persons should pass on information because they believe it is useful or whether the director should ask any of the people on the list whether they have information.

If the principle to be used is on request, what assurances can the Minister give us that this is not a licence to go on fishing expeditions; whenever people have a vague suspicion, they can fire off requests to all these people in the hope that they will say something that will justify what they want to do. If we are in the business of fishing expeditions against innocent people, what assurances can we be given that we will not suddenly find our tax affairs being disclosed to the director on the off-chance that if he has no other work to do he might, by asking random questions of the permitted persons, come up with information to keep him busy?

This would then be a snooper's charter, and the Minister rather suggests that it will be. I was originally going to say, on the basis that people were going to disclose information, that the other way round is important. How will the information be released, if it is going to be passed on by these people? Will there be a formal procedure whereby a tax inspector looks at an individual's tax returns and says, ''There are grounds for suspicion here that proceeds of crime are involved, and as the district tax inspector, I am looking into it, so I shall formally report it in such a way that it is on file for the future''? If that route is to be taken, the district tax inspector is not covered by many of the restrictions and regulations that apply to the director. The tax inspector would therefore be free to do whatever he likes and to act unfettered as the director's ears and eyes, while we have been trying to ensure that the director works within the law as passed by Parliament.

What will the procedure be? How will the information be released? Will it be recorded if there is any redress to be had from an investigation into someone's activities where the courts found no criminality? Can the acquitted say, ''Under freedom of information and human rights legislation I want to know what information was disclosed''? Will they be assured of the ability to find out what information the tax inspector released, which would otherwise have been confidential? I believe that they should be, and that the Minister should tell us so. If that is not the case, we will be opening the floodgates. Tax inspectors all over the country will be picking up the phone and saying, ''I can't put this in writing, and it isn't necessarily something I can justify, but I have a hunch. Why don't you have a look at it?''

Is that the sort of system there will be? Is that how information will be released? Will we have, on the one hand, a snooper's charter, and on the other hand, a group of people who might not be able to justify slapping a tax assessment on someone, but who believe they might be able to cause difficulty for that person by suggesting that the director carry out an investigation and cause trouble? My experience over the years suggests that if a tax inspector cannot sort something out, he sometimes decides that a good solution is to make an accountant take the money from a taxpayer. Would the clause enable a tax inspector who cannot get his mind round an assessment to generate trouble for a taxpayer by having him investigated by the director, at enormous expense?

The second question that the Minister must address is who will decide what information it is appropriate to release. We have spent hour upon hour talking about what the director can do, and what he can and cannot release, or say, and so on. Now we are given a list of people who are to be allowed to pass on whatever information they like, without restrictions. I see no safeguards in the Bill; if there are some, the Minister will doubtless tell me. A tax inspector, or any of the other people listed, can take it on themselves to release whatever they think suitable or desirable. That is not the sort of society in which I want to live—and I suspect that the Minister would not want to live in that sort of society either. He must tell us what safeguards exist, what the rules are and who will decide what is appropriate.

There must be rules and tests. One cannot have tax inspectors coming into work one morning feeling a bit crotchety and thinking, on a whim, ''I know what I'll do: I'll release some information because it may cause trouble for someone''. [Laughter.] The Minister may laugh; he may think that life is not like that—but from my experience, and that of an awful lot of other people, it does seem like that. If there is genuine evidence that meets criteria that Parliament has approved, implemented in a way that Parliament has also approved, I have no objection in principle to the Commissioners of Inland Revenue providing information about it, but it is our duty to require to know whether they will do so in response to a request or off their own bat, how they will do so, and who will take the decision to release such information. Will it be a junior in the office, or someone at senior level, who decides?

We are coming to a group of amendments that address the question of which people can take the decisions, but we also need to know what rules will exist to determine what is appropriate. My hon. Friend the Member for Beaconsfield has put down a probing amendment; it is not sensible remove a proposal at random for the sake of it, and I agree that we do not wish to divide on the matter now. However, unless there is a reasonable explanation on Report, I would be sorely tempted to take the whole lot out.

The Minister of State, Scotland Office (Mr. George Foulkes) rose—

David Wilshire (Conservative, Spelthorne)

I give way to the Minister of State; I am sorry to have disturbed his sleep.

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

I was going to ask the hon. Gentleman whether he gets into trouble with his Chief Whip if he does not fill all the time available.

David Wilshire (Conservative, Spelthorne)

I get into trouble with my Chief Whip irrespective of whether I fill the time, so in that sense today is no different from any other day. However, I am grateful to the Minister for listening, and for trying to judge the quality of what I am saying. That is a pleasure that he may also have later in the day.

I believe that I have touched on the key issues, and I hope that the Under-Secretary is willing to spare a little of his precious time to address them.

Mark Field (Conservative, Cities of London and Westminster)

I endorse my hon. Friend's comments.

The matter is of great concern. One of the most insidious phrases in English, particularly in relation to any investigation by a state authority, is, ''Well, if you had nothing to hide, you would allow things to move ahead.'' If I may digress briefly, one of the advantages—or disadvantages—of representing the Cities of London and Westminster is that many constituency duties can be carried out during the day. Only yesterday I toddled down to the Department for Education and Skills in Tothill street, where the retired civil servants have their monthly meeting. A range of domestic and international political issues was discussed, and an elderly woman asked, in quite a hostile fashion, ''Where do you stand on identity cards?'' I am implacably against making them compulsory. She then said, ''If people have nothing to hide, what is wrong with identity cards?''

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

May I clarify for the Committee whether the hon. Gentleman is the individual who, on leaving Parliament yesterday, gave me a cheery wave and said, ''I'm off to launder some money''?

Mark Field (Conservative, Cities of London and Westminster)

I am glad that there is a good sense of humour on both sides of the Committee. Those were indeed my precise words yesterday, when I was wearing rather different attire from what I am wearing today. My hon. Friend the Member for Henley—who is no longer present—and I are wearing the traditional bird's eye pattern Back-Bench attire today, but yesterday I was in my thick pin-stripe suit, which looks very City-oriented. At about a quarter past 11 yesterday morning I encountered the hon. Member for Glasgow, Pollok, doubtless after a particularly boozy night at the rugby club dinner, staggering through the Members Entrance. He caught my eye and we had a little exchange—

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

These are disclosures.

Mr. Davidson rose—

Roger Gale (Conservative, North Thanet)

Order. We are coming perilously close to the edge of order. I was already having some difficulty in establishing the relevance of the discussion, and I have now lost the drift of the argument. I would like us to return to the amendment.

Mark Field (Conservative, Cities of London and Westminster)

Thank you, Mr. Gale.

I was focusing on whether people who have nothing to hide should worry about the intrusion of the state through identity cards, and whether they should be happy to allow the state look through their affairs—tax returns, bank accounts and so forth. I made it clear yesterday, and do so again today, that that road leads to totalitarianism. The argument that if one has nothing to hide the state should have full rights over all one's affairs is made at the beginning of all totalitarian states. It was made in the 1930s in Nazi Germany, and has been made under a whole raft of dictatorships. I am deeply concerned about that argument.

I acknowledge that MPs are public servants who have a greater duty to be open about their personal affairs, but equally, private citizens should not be under threat from the Inland Revenue or other public officials to disclose what is in their bank account on the basis that if they have nothing to hide, they should

not be reluctant to do it. That is a fundamental philosophical—as well as constitutional and political—concern, which rings true for many people on the Opposition side of the Committee. That is why we stress the need for specific safeguards. How does the Minister envisage putting safeguards in place to ensure that whatever permission is granted to a range of individuals under subsection (5), the liberty of the individual will be maintained?

Nick Hawkins (Conservative, Surrey Heath)

I support my hon. Friends, and I strongly share the philosophical concerns expressed by my hon. Friends the Members for Cities of London and Westminster (Mr. Field) and for Spelthorne. We all recognise that those who work for the Inland Revenue have a job to do on behalf of the state, but although we want them to do the job properly, Parliament must be careful to ensure, as my hon. Friend the Member for Spelthorne rightly said, that officials are not allowed to go on fishing expeditions. Those of us who share concern about authoritarianism or the nanny state are bound to be concerned about the open-ended opportunities created by the new legislation. Such concerns are absolutely valid with regard to this part of the Bill, which is why I strongly support the amendment and what my hon. Friends have said about it.

It will always be a matter for great concern if we think that legislation may be misused in the future. We know that these particular Ministers would not want to be part of any misuse, but we must legislate for the future—and who knows how the legislation that we pass now might be misused in the future if we are not careful? I simply want to put on the record my strong support for what my hon. Friends have said.

Bob Ainsworth (Labour, Coventry North East)

I shall try to give some reassurance to the hon. Members for Surrey Heath, for Cities of London and Westminster and for Spelthorne—but before I do, I must express my admiration, albeit in his absence, of the hon. Member for Spelthorne. He said that he might have been absent from some debates—but in order not to have noticed the issue that he has now raised, he must have been absent from all the debates on a large portion of part 1 and the whole of part 6. Moreover, he has other duties in Committee as a Whip, which he has carried out admirably—yet we now find that he has managed to conduct all his negotiations with my hon. Friend the Government Whip without having any knowledge of the content of the Bill. That is incredible, especially as his handling of matters has been beyond all criticism. His ability deserves some recognition.

As for fishing expeditions and the inappropriate use of the measures in the Bill, I cannot reopen the debate that we had on part 6, as I do not think that you would allow me to, Mr. Gale, even if I wanted to. There will not be fishing expeditions or people running rampant over taxpayers' rights and constitutional rights. The Revenue has strict legal duties to maintain the confidentiality of information provided by the taxpayer. Subsection (5)(c) allows the Revenue legally to disclose information to the director, but

only if the information is relevant and appropriate to the director's functions and proportionate to the request. That is because of the interaction of the requirements of the Data Protection Act 1998, the Human Rights Act 1998 and the gateways provided in the Bill.

It has been central to our thinking that we do not want the director to be able to stray into the normal affairs of the Revenue. He cannot get involved with the crimes that are investigated by the Revenue, such as tax evasion. Such investigations are not his function, and will continue to be conducted by the Revenue. A memorandum of understanding will be drawn up by the director and the Commissioners of Inland Revenue to dictate exactly how requests will be made and dealt with. They will be specific to the director's functions, and he will have business involving his taxation powers only when he has had a case passed on to him, he has followed the hierarchy of the Bill's provisions, other people have considered criminal investigation, and he has considered criminal confiscation and civil recovery.

This may come as a shock to the hon. Member for Spelthorne, as we move towards our 38th sitting, but in those circumstances, we are giving the director the ability to raise a tax assessment on the proceeds of crime. I am sorry that that revelation has come so late to him. That power will not allow for fishing expeditions. It is strictly governed by, for instance, the rules of proportionality and data protection—and the rules of confidentiality that apply to the Revenue will also apply to the director.

Dominic Grieve (Conservative, Beaconsfield)

I am grateful to the Minister for re-emphasising some important points about how the legislation is intended to function.

The Minister should not be surprised that the subject under discussion has frequently been raised, as it causes genuine anxiety. We are breaking down some of the barriers that have existed between Departments in exchanging information. Those barriers were erected to encourage people to be open and honest in their dealings with Departments, and to reassure them that their confidences would be respected.

What we are discussing would be a major change from the situation that prevailed when the Inland Revenue began its relationship with taxpayers in the 19th century. As the Minister will know, people at that time were so concerned about maintaining confidentiality that many funny schedules were created to prevent any one tax inspector from having full knowledge of an individual's finances.

We are moving a long way from that. The hon. Member for Glasgow, Pollok often says that people who have nothing to hide have nothing to fear. That might be true, but it does not mean that confidential information that people who have nothing to hide have provided to a specific Department for a specific purpose should be used for another purpose. If people were to lose confidence in their dealings with Departments, channels of communication would dry up—and that applies to the Inland Revenue in particular. If that happened it would hinder the operation of the legislation.

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

The hon. Gentleman said, ''used for another purpose''. If information provided for a specific purpose is passed onto someone who studies it for another purpose, and they decide that it contains nothing untoward, it will not be used for any purpose, because no action will be taken. It would be used only if the person who provided the information had cheated on their taxes.

It has been established that the Conservative members of the Committee are the friends of the criminal. If they are also the friends of the tax evader, they will all support the hon. Gentleman's opinion on the matter under discussion—and if that is the case, it should be noted.

Dominic Grieve (Conservative, Beaconsfield)

The hon. Gentleman is jumping to a conclusion about the way in which the legislation could work. It would not merely make it possible to reveal the tax information that had been passed to the Inland Revenue in respect of an individual against whom proceedings may have been brought under the Bill. Its scope would be wider. In certain circumstances—with regard to civil recovery, for example—it could cover the transfer of information relating to individuals against whom no such imputation had been raised. That could happen, and for understandable reasons. For instance, the director might want to see the complete picture with regard to a case. The hon. Gentleman should bear that in mind. Such circumstances would arise very rarely, but tax information might be revealed pertaining to an individual whom the hon. Gentleman would regard as innocent.

Bob Ainsworth (Labour, Coventry North East)

Some of the hon. Gentleman's comments are correct. Let us bear in mind some of the discussions that we have had about the need for standards, and for a certain culture to be developed in the agency. We should also bear in mind the fact that—and here I am contradicting my hon. Friend the Member for Glasgow, Pollok—the director will not deal with matters such as tax evasion. The Revenue will continue to deal with tax evasion.

Dominic Grieve (Conservative, Beaconsfield)

I do not disagree. I think that the Minister and I agree that information pertaining to an individual's financial relationship with the Inland Revenue, which is usually provided for the purposes of taxation, could be made available to the director in the exercise of his functions, even though it may relate to a person against whom the director is not aware of any imputation of wrongdoing. He may need that information to lay his hands on money in someone else's hands. My interpretation is that the Bill is sufficiently widely drawn to encompass that circumstance, certainly on civil recovery. If I am wrong, the Minister will correct me.

Bob Ainsworth (Labour, Coventry North East)

Any action will have to be justified by proportionality.

Dominic Grieve (Conservative, Beaconsfield)

Of course.

Bob Ainsworth (Labour, Coventry North East)

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

Dominic Grieve (Conservative, Beaconsfield)

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

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

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

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

Dominic Grieve (Conservative, Beaconsfield)

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

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

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

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

Bob Ainsworth (Labour, Coventry North East)

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

Dominic Grieve (Conservative, Beaconsfield)

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

Bob Ainsworth (Labour, Coventry North East)

Absolutely.

Dominic Grieve (Conservative, Beaconsfield)

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

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

David Wilshire (Conservative, Spelthorne)

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

Dominic Grieve (Conservative, Beaconsfield)

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

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

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

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

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

Amendment, by leave, withdrawn.

Dominic Grieve (Conservative, Beaconsfield)

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

Roger Gale (Conservative, North Thanet)

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

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

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

Dominic Grieve (Conservative, Beaconsfield)

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

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

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

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

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

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

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

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

David Wilshire (Conservative, Spelthorne)

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

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

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

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

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

We are told that

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

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

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

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

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

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

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

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

Steve McCabe (Labour, Birmingham, Hall Green)

I am following the hon. Gentleman's argument with devastating interest. Has he been instructed to make any progress on any other clauses between now and 11.25?

David Wilshire (Conservative, Spelthorne)

I have not been given any instructions—I am in free fall, which may be apparent to the hon. Gentleman. If we designate people, but in respect of only part of their functions, that is the equivalent of saying that the Commissioners of Customs and Excise can disclose information about VAT, but not about duty. It is a ridiculous distinction to draw. The example used was that the Department of Trade and Industry could disclose information about insolvency, but nothing else. I do not believe that there are people within the Department who are so specialised that they know nothing about anything other than insolvency.

Mark Field (Conservative, Cities of London and Westminster)

I ought to point out to the hon. Member for Birmingham, Hall Green (Mr. McCabe), that my hon. Friend the Member for Spelthorne gives the instructions, rather than taking them.

The Minister may have satisfied us that under subsection (5), only senior members of each of those bodies would have authority. However, is there not a danger that under subsection (6), any such safeguards would be ignored? The Secretary of State could designate more junior members of listed organisations whose functions were of a public nature. That would provide an opportunity to ignore the safeguards. Does my hon. Friend have any thoughts on that matter?

David Wilshire (Conservative, Spelthorne)

My hon. Friend will go far. It has not taken him long to learn the real role of the Whip, and I commend him for that. He has also raised some valuable points, on which he might care to expand later.

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

I am particularly grateful to the hon. Gentleman for giving way to me, as he said that he was in free flow—

David Wilshire (Conservative, Spelthorne)

Free fall.

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

He has also just encouraged one of his colleagues to speak at length on a particular issue. Has he taken into account the number of other clauses that we have to deal with before the Committee rises this afternoon? Does he believe that if the Scottish Parliament, under the Sewel procedure, passes to us the responsibility to debate various motions and elements of legislation, we have an obligation to do so? Does he also agree that the self-indulgent wittering in which he has engaged today, and at our previous sitting, tends to negate the Sewel procedure?

David Wilshire (Conservative, Spelthorne)

One person's pearls of wisdom are another person's wittering. That is a subjective judgment, and I cannot be accountable for the hon. Gentleman's judgment in such matters. I am convinced that what is being said is important and needs to be said—and as you have not ruled me out of order, Mr. Gale, my comments were obviously relevant. The fact that the hon. Gentleman does not find them acceptable is entirely his fault. I am sorry about that. As for the other clauses to be considered, he will notice that we have to get to clause 427 by 5 o'clock. If he holds his breath and keeps his patience, he may find that he has every opportunity to contribute to the debate on all the other clauses. It was not the Opposition who decided that we had to reach that point by 5 o'clock, it was his Government.

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

Were not the points at which the guillotine was to fall agreed between the Government and the Opposition? Indeed, it was the hon. Gentleman's party that asked for debate to be curtailed by starting the Committee at 9.15 rather than 8.55 on a Thursday morning.

Mr. Wilshire rose—

Roger Gale (Conservative, North Thanet)

Order. I must now bring the Committee back to the amendment under discussion, while at the same time pointing out to the hon. Gentleman that I will not allow comments that are out of order to be made, and that two of the amendments under discussion relate to Scotland.

David Wilshire (Conservative, Spelthorne)

I am grateful to you, Mr. Gale. I fully appreciate the fact that you will stop anyone who is out of order, and I always do my level best to ensure that I remain in order. Hansard will show that I do not stray too often.

Roger Gale (Conservative, North Thanet)

Order. Under this chairmanship, the hon. Gentleman will not stray at all.

David Wilshire (Conservative, Spelthorne)

I appear to have just done so.

Amendment No. 605 is part of an attempt to restrict the powers of a person to disclose, if he is added to the list. I am concerned that the Government believe that one can take a body such as the Department of Trade and Industry, authorise the Secretary of State to make disclosures, and then somehow restrict those powers. How is it possible to select little bits and allow a customs officer to disclose on VAT but not on duty? The powers work across the board. I should be grateful if the Minister could address that issue and explain why subsection (7) is necessary, how it will operate and what sort of safeguard it offers.

Bob Ainsworth (Labour, Coventry North East)

Clause 421(5) lists a number of ''permitted persons'' who will have the power to disclose information to the director for the purpose of the exercise of his functions. Those are listed in the Bill, as we believe that there is a clear need for them to disclose information to the director because of the functions that they perform. The listed persons include all those most likely to have been previously involved in a substantive way with the investigation of a case that the director is now dealing with.

Subsection (6) allows the Secretary of State to designate other permitted persons by order, if they exercise functions that he believes to be of a public nature. The hon. Member for Spelthorne objects to the use of those terms, but the phrase ''of a public nature'' comes from case law and arises from judicial review. Only a public body can be judicially reviewed, so the term has a legal derivation. I mean it as a compliment when I say that I can detect that the hon. Gentleman has been trained by the right hon. Member for Bromley and Chislehurst (Mr. Forth), because of the way in which he presents himself in Committee. However, he is still the journeyman, not the master.

I shall move on to the more substantive points and the explanation required by the hon. Member for Beaconsfield. Subsection (7) states that in specifying any additional person as a permitted person, the Secretary of State

must specify the functions in respect of which the designation is made.

Amendments Nos. 604 and 605 would remove subsections (6) and (7), thus preventing those designations that are mirrored under the Scottish legislation, which the hon. Gentleman also seeks to remove.

I sent out a note yesterday that sets out how we intend to use the order-making power under clauses 421 and 425. It makes it clear that the power will be used to designate persons who have specific functions likely to give rise from time to time to information that would be relevant to the director. It cites examples of when the order-making power might be used, but we expect there to be other examples of public bodies that have regulatory or investigatory functions, which might have information relevant to the exercising of the director's functions.

As the hon. Member for Beaconsfield anticipated, the power is also in place to allow bodies that will be set up in the future to be designated as permitted persons, without the need to return to Parliament for primary legislation to be enacted. The hon. Gentleman rightly said that the affirmative procedure would apply, which would ensure that Parliament scrutinised the measure adequately. That is sufficient.

The hon. Gentleman ruined the often exemplary way in which he presents an argument impartially by suggesting that the growth in statutory instruments was a result of the actions of the present Government. I am sure that he will admit that that procedure has grown under both parties since the time that he mentioned, when there were fewer statutory instruments.

Dominic Grieve (Conservative, Beaconsfield)

I was not suggesting that the present position was the result of the present Government's actions alone. The number of statutory instruments has risen steadily since the 1960s, when there were approximately 35 per annum. The number of such measures took off far more markedly after we joined the European Economic Community in 1974, and it continued to increase steadily. It reached a plateau in the early to mid-1990s, at about 3,000. There may be an interesting explanation for this, but in the past 12 months there has been an explosion, and the number of statutory instruments has increased even more.

Bob Ainsworth (Labour, Coventry North East)

The hon. Gentleman has obviously gone into such matters in detail. I am pleased to have provoked him into giving the Committee a more balanced view of the reasons for the increase than he gave originally. I hope that in the light of my explanation, the hon. Gentleman will withdraw the amendment.

Dominic Grieve (Conservative, Beaconsfield)

I am willing to withdraw the amendment, but—this is almost certainly my fault—I have not seen the note that the Minister circulated. That was no doubt because of my absence from the House yesterday for personal reasons. I apologise for the fact that when presenting the amendments, I did not take into account the contents of the note, which I shall read with interest. I do not know whether my hon. Friend the Member for Surrey Heath received a copy.

Mr. Hawkins indicated dissent.

Dominic Grieve (Conservative, Beaconsfield)

My hon. Friend does not seem to have had one either. I did not pick up the note when I came into Committee this morning, but I shall read it with interest now. In any event, with or without it, I did not intend to press the amendment to a Division, but tabled it to highlight my concern about the way in which statutory instruments are being used. The Minister has provided considerable reassurance. In the light of his note, and the trouble that he has taken in providing it, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Dominic Grieve (Conservative, Beaconsfield)

I beg to move amendment No. 606, in page 245, line 1, leave out subsection (9).

Roger Gale (Conservative, North Thanet)

With this it will be convenient to take the following amendments: No. 631, in page 245, line 3, leave out 'an' and insert—

'a District Tax Inspector or higher grade'.

No. 627, in page 245, line 5, after 'a', insert—

'collector or higher grade'.

No. 607, in clause 422, page 245, line 17, leave out paragraph (b).

No. 608. in page 245, line 19, leave out subsection (4).

No. 632, in page 245, line 21, leave out 'an' and insert—

'a District Tax Inspector or higher grade'

No. 628, in page 245, line 23, after 'a', insert—

'collector or higher grade'.

No. 619, in clause 425, page 247, line 27, leave out subsection (9).

No. 633, in page 247, line 29, leave out 'an' and insert—

'a District Tax Inspector or higher grade'.

No. 629, in page 247, line 31, after 'a', insert—

'collector or higher grade'.

No. 620, in clause 426, page 248, line 3, leave out subsection (4).

No. 634, in clause 426, page 248, line 5, leave out 'an' and insert—

'a District Tax Inspector or higher grade'

No. 630, in page 248, line 7, after 'a', insert—

'collector or higher grade'.

Dominic Grieve (Conservative, Beaconsfield)

I was a little daunted when I saw first how the amendments were grouped, but now that seems completely sensible, although it will require a moment to work my way through them. The group has doubled in size, because it is necessary to amend the Scottish legislation as well as that for England, Wales and Northern Ireland. The amendments relate to a point that we discussed earlier about the Inland Revenue, and which also dovetails with Customs and Excise.

As the Committee will recall, we agree that the Inland Revenue should be a permitted person for the

purposes of disclosure of information. However, a question arises about the level in the Inland Revenue at which a decision about the disclosure of information should be made. Given the comments made by Opposition Members, including me, earlier this morning, the Minister will not be surprised to hear that we are concerned to ensure that the decision is taken at the highest level possible. It should not simply become a rubber-stamp job, so that requests are passed from the director to an inspector and a habit of operation prevails whereby they are not given proper consideration.

I do not know—the Minister may be able to say—exactly how many such applications are likely to be winging their way from the director to the Inland Revenue in any one year. I should have thought that in view of the limits on the director's scope for operation, and of the fact that the provisions are serious and should be exercised sparingly, there are unlikely to be hundreds. I may be wrong, and perhaps such requests will become a matter of routine. If they may, that raises the anxiety that I expressed earlier about the mechanism turning into a rubber stamp.

Subsection (8) states:

Information must not be disclosed under this section on behalf of the . . . Inland Revenue or on behalf of the Commissioners of Customs and Excise unless the Commissioners concerned authorise the disclosure.

However, that is subsequently qualified by subsection (9), which provides that the commissioners may delegate the decision making, in the case of the Inland Revenue to an officer of the board, and in the case of Customs and Excise to a customs officer.

Amendment No. 606 would delete that provision and leave squarely with the Board of Inland Revenue, or the Commissioners of Customs and Excise, the duty to make such decisions. Knowing the workings of bureaucracy, I would assume that that would ensure that any such request came before the Commissioners of Inland Revenue or of Customs and Excise, even if it is likely to come with a note or memorandum prepared by someone else, saying whether they believe that the application should be granted.

Ultimately the buck stops with the Commissioners of Inland Revenue and of Customs and Excise, so that strikes me as a powerful mechanism for ensuring that control of the process is maintained, and that they are constantly aware of the volume of traffic passing between them and the director for such requests, so if they feel that the system is getting out of control, or requests are being made that cause them anxiety, that can be rapidly transmitted, if necessary, to the Government so that something can be done about it. That is my object.

If we leave subsection (9) as it stands, it seems that the decision could be made by someone quite low down the hierarchy—a customs officer or an officer of the Board of Inland Revenue, although there may be a hierarchical distinction between an officer of the Board of Inland Revenue and a customs officer, which is why one of the amendments would delete the reference to one but not the other. That, too, is a probing

amendment designed to offer the Committee the maximum number of possibilities.

Other possibilities in several of the other amendments include defining officers of a higher grade than a straightforward officer of the Board of Inland Revenue—such as a collector or higher grade, or a district tax inspector or higher grade—in order to offer variety to the Committee and the Minister. We could examine whether we should pitch the decision-making process at a higher level, but without taking it as far as the board. That is a multi-track approach to allow the Committee to decide where the decisions should be taken. My preference is still that the Commissioners of Inland Revenue or Commissioners of Customs and Excise should take the decisions. If the Minister puts forward a persuasive argument, however, I may be talked out of that.

A further issue addressed by the amendments is the power to consent to further disclosure, which clause 422 relates to. It states that once information has been exchanged, it

must not be further disclosed except . . . for a purpose connected with the exercise of the Director's functions, and . . . with the consent of the Commissioners concerned.

However, subsection (3) states:

Consent under subsection (2) may be given—

(a) in relation to a particular disclosure;

(b) in relation to disclosures made in circumstances specified or described in the consent.

I want clarification from the Minister on that. If I understand it correctly, it would mean that at the time of granting the original consent it would be possible to add to it, and to agree that it could be used for such purposes as are specified. That is about control. I am anxious about it, and unless the Minister provides me with reassurance, I would be happier if people had to return and get an application to disclose again in relation to a particular disclosure. That would be the effect of amendment No. 607, and its mirror image for Scotland, although the Minister may be able to persuade me that subsection (3)(b) is necessary.

Clause 422(4) says:

The power to consent to further disclosure . . . may be delegated.

That returns us to the question of to whom the power should be delegated, and the level at which the decision should be taken. Again, I am anxious to ensure that we do not have a rubber-stamp procedure.

Clearly, it is desirable that there should be a free flow of information for the purposes that the Bill requires. The Minister may have no difficulty in agreeing that it is undesirable that the free flow should become a matter of habit, so that people do not apply their minds to deciding whether it is necessary or not. When a request comes through, a person may say, ''Ah. Here's another request,'' and simply write ''Yes'' on it. Someone must think about these matters, and the higher up the hierarchy that that occurs, the greater reassurance the Committee will have that it will happen. If the Minister persuades me that it can be done at a lower level, so be it, but the Committee should examine all the possibilities.

David Wilshire (Conservative, Spelthorne)

Again, I agree with my hon. Friend. However, I shall make the case more firmly for my preferred choice of amendment No. 606. The amendment would delete the power to delegate.

In my hon. Friend's defence, if the Minister tells us that although there should be delegation, the choice of a district tax inspector or collector of Customs of Excise is inappropriate, I would have to plead guilty to leading my hon. Friend astray, because I chose those grades without much research. If the Minister is minded to accept the amendments, I would be delighted to hear him say that such grades are not appropriate, and different grades should be specified.

However, the principle is correct. If the Minister were to insist on the power to delegate I think that if he tried hard enough, I could be persuaded. The rubber-stamp issue concerns me, but if decisions must be taken at too high a level, and if the size of the work load and the importance of the issues mean that there is no time to consider details, there is a danger—

It being twenty-five minutes past Eleven o'clock, The Chairman adjourned the Committee without Question put, pursuant to the Standing Order.

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

Standing Committee B

Clause 421 - Disclosure of information to Director

John McWilliam (Labour, Blaydon)

I remind the Committee that with this we are taking the following amendments: No. 631, in page 245, line 3, leave out 'an' and insert

'a District Tax Inspector or higher grade'.

No. 627, in page 245, line 5, after 'a', insert --

'collector or higher grade'.

No. 607, in clause 422, page 245, line 17, leave out paragraph (b).

No. 608. in clause 422, page 245, line 19, leave out subsection (4).

No. 632, in clause 422, page 245, line 21, leave out 'an' and insert --

'a District Tax Inspector or higher grade'

No. 628, in clause 422, page 245, line 23, after 'a', insert --

'collector or higher grade'.

No. 619, in clause 425, page 247, line 27, leave out subsection (9).

No. 633, in clause 425, page 247, line 29, leave out 'an' and insert --

'a District Tax Inspector or higher grade'.

No. 629, in clause 425, page 247, line 31, after 'a', insert --

'collector or higher grade'.

No. 620, in clause 426, page 248, line 3, leave out subsection (4).

No. 634, in clause 426, page 248, line 5, leave out 'an' and insert --

'a District Tax Inspector or higher grade'

No. 630, in clause 426, page 248, line 7, after 'a', insert --

'collector or higher grade'.

David Wilshire (Conservative, Spelthorne)

Before I was rudely interrupted at 11.25 this morning, I was making some relevant and informative points. [Interruption.]

John McWilliam (Labour, Blaydon)

Order. The hon. Gentleman is entitled to be heard, no matter how facetious he may be.

David Wilshire (Conservative, Spelthorne)

I am grateful to you for that ruling, Mr. McWilliam. Some Labour Members found what I

had to say this morning not to their liking. I was referring to important matters, but they fell on ears that did not want to hear.

This morning's debate was about whether to delete the power to have other people undertake duties for the commissioners or whether it should be specified who, on behalf of the commissioners, could exercise that power. I hope that, during the lunch break, the Minister reflected on those two choices. As I suggested earlier, probably the best course of action is that the commissioners make such decisions. The powers of disclosure run counter to many of the customs of this country. We have always prided ourselves on saying that a particular investigation will be specific if it is carried out by, say, the Child Support Agency or the Inland Revenue. There will be an end to it and there will be confidentiality within the investigation.

We are now saying, however, that there will be the passing of information. I am not sure that I object to that in principle. All of us have had experiences when it would have been much more sensible if only the national insurance contributions computer had spoken to the Child Support Agency computer. I can understand that argument, but the Bill is a great departure from the way in which such matters have been handled in the past. It probably is right for the cross-fertilisation of information that such a decision should be made at the highest possible level. Amendment No. 606 would make it clear that the commissioners themselves should make such a decision.

I understand only too well that it could be argued that the commissioners have so much else to do that delegation would happen at the end of an agenda, and if there was a large number of requests, there would be neither the time nor the inclination other than to rubber-stamp them. My hon. Friend the Member for Beaconsfield (Mr. Grieve) rightly said that rubber-stamping was the last thing that we needed. If that argument does not find favour with the Minister, amendments Nos. 631 and 627 are the alternatives. I said to the Committee before lunch that I took personal responsibility for selecting the district tax inspector or a collector of taxes. Perhaps that is not the appropriate grade of officer, but it is important to explain why I chose that grade. It was born of my knowledge and experience of dealing with tax inspectors and Customs and Excise. When I ran my own business, not only was I registered for VAT, but I go back to the dim and distant past of being registered for purchase tax.

In the case of both my VAT and my purchase tax affairs, I saw how the system worked. There was always a raft of Customs officers doing all sorts of things. Sometimes I would see one, and sometimes another. My constituency work involves me closely with Heathrow and its customs operations. There is not necessarily consistency in who deals with what.

Such decisions will be delegated to an individual Customs officer if the amendment is not accepted. It is possible that on, say, Mondays, Wednesdays and Fridays, one person might apply his mind to it, and on Tuesdays, Thursdays and Saturdays, the person involved might be someone else. There will not

necessarily be consistency in decisions or depth of experience from an individual Customs officer.

In my own experience, and from my experience of speaking to people, when a serious issue arises, whether in relation to the collection of tax or, as in this case, in deciding whether to disclose information, all individual Customs officers will ultimately defer to their collector, who has a consistency of view, knows the overall workings of the system and what individual officers are doing, and can examine their work and arrive at a clear, balanced and consistent point of view. That is why I chose a collector. It is the lowest grade of which I am aware that involves consistency and personal involvement at a senior level in difficult issues.

I readily accept that the Minister may say that the collector is the wrong person. I am not aware of the grades, ranks and hierarchy of the upper echelons of Her Majesty's Customs and Excise. I am pleased to say that I have never had to tangle with that level of Customs and Excise, which is a plus, rather than a minus. It might be argued that the collector would not be the appropriate person.

The same arguments apply to the district tax inspector. My experience over the years of running my own businesses has brought me into contact with assorted tax inspectors, as is inevitable. Whether or not they run businesses, hon. Members will, because of our salaries and allowances, have come into contact with tax inspectors of one sort or another. The same principle applies. It is possible to come into contact rapidly with several inspectors in the same tax office. Sometimes they apply one way of thinking, sometimes another. My experience has taught me that, in the event of a serious issue to settle, a matter of principle, or a decision to be made on how to proceed, ultimately the district inspector in the tax office will have the file on his desk and can be asked to ensure that consistency is upheld and that the rules are applied.

If the Minister's argument is that the commissioners themselves could not cope with the work involved and that it should be delegated, and if he wants the amendments to be dropped or his colleagues to vote against them, he needs to reassure the Committee that handing the power to every Customs officer and tax official is justifiable and will not lead to inconsistency and, at worst, abuse or lack of experience leading to the wrong conclusion. He must deal with that question. There should be some consistency and control. I have no figures for the number of tax inspectors or Customs officers, but I expect that there are quite a few. I do not believe that such a power should be handed out to the many thousands of people who are bound to be involved. I imagine that the number of times that the power will be exercised will not be in the thousands, although it might well be in the hundreds in the course of time. It is not unreasonable to ask that the exercise of such a power be confined to senior officers in Customs and Excise and the Inland Revenue. I look forward to hearing the Minister's comments.

Bob Ainsworth (Labour, Coventry North East)

Amendments Nos. 606 and 619 would limit disclosure to those authorised personally by the Commissioners of Inland Revenue or Customs and Excise. Amendments Nos. 608 and 620 would similarly restrict the power to consent to further disclosures. That would be impractical and bureaucratic. It would limit the numbers of disclosures that are possible, and could introduce unhelpful delays into the process.

For example, there are only five individuals who are Commissioners of Inland Revenue. It would not be a good use of their time to authorise every disclosure. The delegation of the authority to disclose will be to specialist staff who will be adequately trained and supervised, and subject to strict statutory rules of confidentiality. I think that the hon. Member for Spelthorne (Mr. Wilshire) adds another argument to that, because there would be a potential for a lack of quality if powers were delegated too far up. He knows how these things work, and he made goods points about ends of agendas.

David Wilshire (Conservative, Spelthorne)

The Minister seeks to reassure me, but he may have a different copy of the Bill from mine. There is no provision in my copy to ensure that delegation shall be to a specialist who is properly trained. If the Bill said that, I could accept his comments. If he thinks that my argument is right, will he, after rejecting these amendments, table another that says exactly what he just offered?

Bob Ainsworth (Labour, Coventry North East)

Hold on.

Commissioners of Customs and Excise would normally delegate their authority to commissioned Customs officers. Delegation will be at the discretion of the commissioners concerned. The provision that requires special treatment for these forms of information reflects the particular sensitivity of the information to the Revenue and Customs and Excise. We are, therefore, justified in being confident about how they will use their powers of delegation.

Amendments Nos. 627 and 634 are alternatives to those that I already mentioned, because they would not remove the power to delegate but establish that delegation must be to only a specific rank. Amendments Nos. 631 to 634 would mean that the Commissioners of Inland Revenue could delegate the power to disclose or further delegate information to a district tax inspector or higher grade only. Amendments Nos. 627 to 630 would mean that Customs delegations could be made only to a collector or higher-grade Customs officer.

The same arguments apply here as those that I made in response to the other amendments in the group. The resulting system would be bureaucratic and lead to delay. Both Revenue and Customs officers are able to take the responsibility for authorising disclosure. They do not see the need to make that a matter for a higher-grade officer.

Opposition Members mentioned our Revenue. It may be dangerous for politicians to become great fans of the Revenue, but it operates its rules and confidentiality to a high standard, and we want to hang on to that. Do we want our legislation to show

confidence in organisations' ability to deal with matters appropriately and to delegate to specialist officers with the necessary training and commitment to confidentiality? Alternatively, do we think that the organisations will delegate responsibility to people who, as the hon. Member for Spelthorne said, are not at work on Tuesdays, Wednesdays and Fridays, and who have not received any training and are not capable of the task?

Do we want to lay out a bureaucratic stricture in legislation, or are we confident that the organisations can deal with confidential information and pass it on appropriately? Everything that has been said seriously in Committee shows that we do have confidence that the organisations will deal with matters appropriately, and that the Revenue cherishes its reputation for handling confidential information appropriately. The Revenue will not put that at risk by delegating the powers inappropriately.

Amendment No. 607 would limit cases of onward disclosure of taxpayer information that is consented to by the Commissioners of Inland Revenue or Customs and Excise to a case-by-case consideration. Again, that would be impractical and unnecessarily bureaucratic. In addition to case-by-case consideration by the Revenue or Customs and Excise, there may be circumstances in which the nature of disclosure follows a similar pattern. Clause 422(3)(b) provides for the Revenue or Customs and Excise to consent to further disclosures of a kind, rather than requiring them to consent to disclosure repeatedly in very similar circumstances. The provision provides flexibility. If the Revenue or Customs and Excise consider that a case-by-case consideration is warranted, they can, and will, adopt that approach. We will not tell them that they cannot.

Boris Johnson (Conservative, Henley)

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

Sitting suspended for a Division in the House.

On resuming--

Bob Ainsworth (Labour, Coventry North East)

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

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

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

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

David Wilshire (Conservative, Spelthorne)

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

Bob Ainsworth (Labour, Coventry North East)

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

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

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

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

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

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

Dominic Grieve (Conservative, Beaconsfield)

The Minister has responded carefully to questions about several issuesand especially powers of delegation.

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

Bob Ainsworth (Labour, Coventry North East)

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

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

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

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

Dominic Grieve (Conservative, Beaconsfield)

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

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

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

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

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

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

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

Bob Ainsworth (Labour, Coventry North East)

I am following the hon. Gentleman's point, and he has raised genuine issues for concern. I wonder if he could focus his argument. Why does he think that there is a particular problem in relation to tax? I foresee that the same issues could arise under foreign jurisdictions with almost any information that we were to pass to them. I am struggling to understand why tax is separate or different.

To what degree would individual approval by the Revenue give additional protection in the circumstances that he, quite rightly, worries about? To what extent should we trust the director and to what extent should we worry about human rights, rights in relation to self-incrimination and the comeback on those issues? To what extent do we think that referral back to the commissioner will add something?

Dominic Grieve (Conservative, Beaconsfield)

I do not want to get dragged into a general discussion of the powers under clause 423(1)(h) if I can avoid it. We shall come to that subject shortly.

The Minister is right that there are issues about disclosing any information that the director may have to hand to a foreign Government, because the director then ceases to have control of it. It could be used against the person concerned or others in a way that infringes, for example, human rights legislation in this country. Clearly, with some foreign countries, that risk is considered minimal, but even some of our European neighbours' track records in criminal investigation are, I regret to say, not very good. It is often a subject for discussion in their newspapers that the activities of their investigating magistrates, for example, turn out to be oppressive. We have criticisms of our system, too, but one has only to consider the nature and quality of some of the criticisms made in Europe to feel anxiety about the way in which some foreign countries, including some quite close to us that are regarded as democracies, enforce criminal law.

I shall focus on the specific question of why the Inland Revenue, or Customs and Excise for VAT, should be different. The Minister has acknowledged the difference by requiring that certain bodies give authorisation for disclosure under the clause; subsection (8) specifies the commissioners. For some reason, the Minister and the draftsman have considered that there should be special safeguards for tax material. I always understood that that is because of the special nature of the relationship of

confidentiality between individuals and the bodies to which they pay their tax. That is well established in this country.

The Minister has acknowledged, owing to the way in which the clause is drafted, that the tax information that is likely to come to the Commissioners of Inland Revenue or Customs and Excise is treated as a special category. If I identify that that is a special category for onward transmission from the director, the Minister, in logic, must agree with me. If information was a special category when it was given to the director, surely it should remain a special category when it is in the director's hands.

That is acknowledged by the way in which clause 422 is drafted. That clause relates to further disclosure if information comes from the Inland Revenue or Customs and Excise. The Minister offered an attractive argument that we are discussing generic matters such as names and addresses, which may sound relatively innocuous and straightforward. However, that does not detract from the fact that the information originated in the confidential relationship between the individual and the Revenue or Customs and Excise. In such circumstances, there should not be a generic disclosure clause.

In the case of onward transmission from the director, he should return to the two bodies and say, ''You supplied me with information about Mr. Bloggs's tax affairs. I think that this would be very useful to the German authorities in the money laundering proceedings that they are to bring against him. Do you agree that it should be disclosed?'' The Revenue, with its Revenue hat on, would have a further opportunity to refuse that, if it had good reasons to do so, rather than giving a blanket permission, which could lead to difficulties.

If the number of cases will be as small as the Minister suggested, that would not cause a serious problem. It would mean only that after the Revenue gave information and generic guidelines to the director, it would not lose control of the information in a manner that could be held against it. I am worried about its reputation.

Bob Ainsworth (Labour, Coventry North East)

And so should we be, but the hon. Gentleman tries to use the Bill's structure against my argument. The worries of the Revenue and Customs about ensuring their reputation for confidentiality and control of information has affected the way in which information is protected by the Bill. The same commissioners who have those worries are those who will agree any methodology that allows the generic transmission of onward information.

If we try to extend the culture of confidentiality beyond the director, I do not know what we would add to the Bill by providing that even if the commissioners are comfortable, in given circumstances, to give generic permission for onward transmission, we should say, ''No. Even if you feel that you are comfortable, we can't allow you to enter into such an arrangement.'' I understand that the hon. Gentleman is making a serious point, but I struggle to understand why he thinks that the very people who insist on confidentiality and who were involved in

drafting the Bill would enter into such generic arrangements that would damage their reputation.

Dominic Grieve (Conservative, Beaconsfield)

I very much hope that they would not. I have paid compliments to the Inland Revenue and its attitude, born of my experience of prosecuting on its behalf. Perhaps the Minister will say that the Revenue asked for clause 422(3)(b), but I cannot help thinking that it is not necessary at present. If the director wishes to make use of such information, it is said that he must first gain permission to do so, but given the volume of disclosure that is likely to take place, the Committee may be more comfortable if such matters are dealt with case by case, for no other reason than that an individual taxpayer's affairs are ultimately thatindividual.

The trouble with generic disclosures is that, when someone has tried to identify a category and says that, in the case of names and addresses, for example, the person need not bother to come back, the issue tends to be forgotten about until something goes wrong. Someone will say, ''I think I made a mistake, so we should change the category.'' That mistake might not have happened if there had been a process by which it can be said, ''In the case of Mr. Bloggs, can we do this?''

The matter cuts both ways. It is difficult to see that a greater burden will be placed on either the director or the Revenue if clause 422(3)(b) is deleted. In the absence of a cogent argument against that, I am minded to press amendment No. 607 to a Division to register our concern. The Opposition are unlikely to win the vote, but will the Committee consider whether it is appropriate, in the case of tax affairs, which we have decided to treat particularly carefully, that there should be a right of onward information provision by the director, without the Inland Revenue being asked about it? I shall withdraw amendment No. 606 and press amendment No. 607 to a Division. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 421 ordered to stand part of the Bill.

Clause 422 - Further disclosure

Dominic Grieve (Conservative, Beaconsfield)

We have clearly covered a lot of ground on the clause. Let us consider subsection (6). It states:

A permitted person who discloses such information to the Director may make the disclosure subject to such conditions as to further disclosure by the Director as the permitted person thinks appropriate; and the information must not be further disclosed in contravention of the conditions.

My question relates to the exchange of information with foreign countries. How will the effect of subsection (6) be guaranteed?

David Wilshire (Conservative, Spelthorne)

I had not considered that. I shall be interested to hear the answer.

Other aspects of subsection (6) worry me. It refers to conditions such as the person involved wants to attach. What sort of conditions does the Minister have in mind? The explanatory notes, to which I referred for guidance, give as an example ''sensitive operational details''. It occurs to me that this is a Pollok-type issue--a possible loophole. Is the Minister suggesting that information providers--which I imagine might include the intelligence services, as they were mentioned this morning--might for operational or sensitive security reasons attach a condition that the information cannot be passed on and therefore cannot be used? If so, might we be creating a loophole?

We now know, and the world will know, because it will be able to read the explanatory notes and the debate, including the Minister's comments, that if you can organise your laundering of money, or whatever else it is that you do, in such a way that somehow--

John McWilliam (Labour, Blaydon)

Order. I have never laundered money in my life. The word ''you'' refers to the Chair.

David Wilshire (Conservative, Spelthorne)

Yes, I was getting carried away. The enthusiasm of my argument led me not to think too carefully about how I phrased it. I shall slow down and measure my words with more care.

My point was not that you, Mr. McWilliam, would launder money, but that it would be possible for someone to spot a possible loophole and say, ''I want to launder money''--I have not laundered money, but ''I'' is easier, and will not fall foul of your strictures--''and if I can involve a sensitive security matter in the process, I might get away with it, because the person who wants to release information will have to attach conditions that specify that it cannot be used.'' Is that really what the Minister wants? Is he suggesting that if we can find an embarrassing, awkward, secretive way of doing it, it will be impossible to pass on the information? What does he have in mind?

The provision might provide a loophole for the prosecuting authorities, and I am sure that that was not intended. What would happen if the person released the information but the attached condition was a ban on releasing it to a court or to the defendant's lawyers? Under the provision, such a condition could be attached. Nothing excludes it.

We return to the issues with which we dealt this morning. I shall not repeat them, but people cannot unknow what they know.

Under the provisions, it is perfectly possible, if the information is sensitive or embarrassing, to allow the release of information to the director on condition that he not release it to the defendant's lawyers. What would happen? The prosecution would proceed, and the defendant would not know what the information was. People would not necessarily rely on it in giving evidence, but it would underpin the arguments developed, and great strength would be drawn from being able to use that information but being under an obligation not to pass it on. If it were to crop up in the future, the prosecuting authorities, the director--or whoever else--could say, ''Yes, I realise that it probably could have been passed to the defence, and that it probably should have been, but this Act prevented me from doing that.'' Would we not then have handed to the prosecuting authorities and the director a good way of ensuring that justice is not done?

With regard to many of the Committee's discussions, there has been an underlying sense that we are stacking the odds so much in favour of the state, the prosecuting authorities or the director that we are undermining the principles of justice. I am sorry that the hon. Member for Glasgow, Pollok (Mr. Davidson) is not present, because he would have wished to have intervened on that point, and I would have been happy to tell him, yet again, that he is wrong--that he does not need to try to create a Gestapo state to look after those of his constituents who get done over by drug barons.

Will the Minister provide examples of the conditions that might be attached? I want him to reassure us that we are not creating a loophole, by allowing the security services to withhold information, whereby criminals could avoid prosecution by doing things in such a way that the authorities would not act, because they would not be prepared to release certain kinds of information. Above all, I want him to explain why I should not be worried about information being withheld from the court and from defendants.

Bob Ainsworth (Labour, Coventry North East)

I struggle to see the relevance to the clause of many of the hon. Gentleman's commentsalthough they might be relevant to other clauses.

This clause sets out provisions that restrict the further disclosure of information that has been disclosed to the director. It does nothing else.

David Wilshire (Conservative, Spelthorne)

The Minister has answered his own question. He said that he does not see the relevance of my remarks, and that is my point. The clause allows someone to pass information to another person, on the understanding that it is not to be passed to anyone else. For instance, I might pass information to the Minister and say, ''You can know it, but you cannot pass it on to a third party.'' That is what I am concerned about.

Bob Ainsworth (Labour, Coventry North East)

We are not talking about him and me, we are talking about the Revenue and the director. They represent public bodies that are accountable in different ways.

The point of the provision is straightforward: if a person or an organisation hands information to the director, that person or organisation is entitled to say to whom, and in what circumstances, he can pass it on. In other words, certain proprieties would be attached to such information. I thought that the hon. Gentleman would support that. If the Revenue gives information to the director, it will want to know that he has a good reason for asking for it, and how he will use it, and what led him to make the request. If he wishes to pass that information to someone else, the Revenue will want to be satisfied that it has some control as to the circumstances in which he will do that, so that it can impose conditions, if that is thought to be necessary. The provision enables the Revenue to do that.

On the extent to which the passing on of information will be controlled, the hon. Member for Beaconsfield raised a point about foreign powers. The restrictions will be imposed on the director, rather than on the foreign Government--or tax authority, or prosecuting authorities. Those restrictions address how, in what way, and with what limitations, the director can further disclose. We have effective control of the way in which he will conduct his business, and he will be obliged to comply with the restrictions that are placed on him.

Dominic Grieve (Conservative, Beaconsfield)

Of course, I understand that. Let us supposed that a restriction on further disclosure has been imposed on the director. If he intends to make a disclosure to a foreign Government, he will be in a position where he cannot make that disclosure.

Bob Ainsworth (Labour, Coventry North East)

Possibly.

Dominic Grieve (Conservative, Beaconsfield)

Or, if he makes the disclosure, there must be a risk that the information will be used subsequently by a foreign Government in a way other than that which the director had undertaken. In such a case, there will be criticism of the way in which the system works.

I accept that part of the argument may be more sensibly discussed under clause 423, because such issues are closely linked. Restrictions may be imposed, but by their very nature it is difficult to see how the director can exercise any control over that further disclosure and how it might be used.

Bob Ainsworth (Labour, Coventry North East)

In any disclosure made by the director when he has obtained information from elsewhere, it is not only he who should be aware of how it could be used. The person who gave him the information in the first place will also bear in mind how it should be used and is entitled to put restrictions on his disclosure. The point made by the hon. Gentleman about potential abuse is outwith that issue.

Question put and agreed to.

Clause 422 ordered to stand part of the Bill.

Clause 423 - Disclosure of information by Director

Dominic Grieve (Conservative, Beaconsfield)

I beg to move amendment No. 609, in page 245, line 37, leave out paragraph (a).

John McWilliam (Labour, Blaydon)

With this it will be convenient to discuss the following amendments: No. 617, in page 245, line 37, leave out 'or may be'.

No. 610, in page 245, line 39, leave out paragraph (b).

No. 621, in clause 427, page 248, line 24, leave out paragraph (a).

No. 622, in clause 427, page 248, line 26, leave out paragraph (b).

Dominic Grieve (Conservative, Beaconsfield)

We now come a series of amendments that deal with the further disclosure by the director. Subsection (1) states:

Information obtained by or on behalf of the director in connection with the exercise of any of his functions may be disclosed by him if the disclosure is for the purposes of any of the following--

(a) any criminal investigation which is being or may be carried out, whether in the United Kingdom or elsewhere.

Amendment No. 609 would delete paragraph (a). Amendment No. 617 would retain that paragraph, but remove the words ''or may be''. A further amendment is consequential and deals with Scotland.

However, what I am asking the Committee to think about is the criminal investigations that may be carried out in the United Kingdom or elsewhere. Paragraph (b) deals with proceedings that have already been started in the United Kingdom or elsewhere.

David Tredinnick (Conservative, Bosworth)

Does my hon. Friend agree that it is not the purpose of the Bill to deal with prosecutions for crime generally? Subsection (1)(a) appears to widen the scope of the Bill.

Dominic Grieve (Conservative, Beaconsfield)

I agree. The intention of the Bill is to deal with the proceeds of crime. That raises the issue of the confiscation of assets from those who have been convicted and have a criminal lifestyle. There are also issues of civil recovery and the taxation of people against whom nothing can be allegedand no civil recovery or confiscation can be madebut who may fall within the taxation powers. Although it features in the Bill, money laundering is a separate matter, with which the director may not be directly connected. I see that the Minister is nodding.

My hon. Friend is absolutely right. The Bill is not directly concerned with criminal investigation. As I said to the Minister earlier, I am worried that the director is being given a series of powers to obtain information that are, on the face of it, greater than those of standard law enforcement agencies. That is, however, difficult to know unless we examine the matter in great detail, and the Minister may be able to help us to do that. I would be grateful for his contribution and the expertise of his officials. However, subsection 1(a) and (b) say that the director's information may be used for purposes of bog-standard law enforcement, rather than for his extraordinary functions.

David Tredinnick (Conservative, Bosworth)

My hon. Friend has put his finger on it. The Committee's worry should be that through the back door, we might be giving much greater powers than were intended. Although the provision

may appear innocuous, it could translate into a substantial increase of law enforcement powers.

Dominic Grieve (Conservative, Beaconsfield)

I agree. It is important to read subsection (1) in its entirety. Paragraphs (a) and (b) can easily be disassociated from the exercise of the director's functions mentioned in paragraph (c)that is obvious. Paragraph (d) refers to

the exercise by the prosecutor of functions under Parts 2,3 and 4,

but those parts are directly linked to offences that are committed for the obstruction of the exercise of those functions. Paragraph (e) refers to

the exercise by the Scottish Ministers of their functions under part 5,

and paragraph (f) refers to

the exercise by a customs officer or a constable of his functions under Chapter 3 of Part 5.

Paragraph (g) is about the safeguarding of national security. However, that has always been such an important issue that it may fall within a wholly exceptional category, so I do not have too much trouble with it. Paragraph (h) relates to investigations outside the United Kingdom, where a completely different problem arises. However, it is linked to the director's functions, rather than being outside them. Paragraph (i) mentions

the exercise of a designated function,

which raises the possibility of a future statutory instrument, although I shall leave that to one side.

My hon. Friend is correct to say that paragraphs (a) and (b) have nothing to do with the director's functions. I want a debate on why they are in the Bill, and I hope for an explanation. What are the consequences for law enforcement? I apprehend that if the director is given a power that might be greater than those of the law enforcement agencies, the agencies will exert pressure to be able to use his information when they cannot get the information for themselves. That would not be good for the director or for law enforcement, and it is not a good thing for this Parliament to legislate for.

David Tredinnick (Conservative, Bosworth)

My hon. Friend has unearthed a plot. Does he suspect an ulterior motive that has been disguised from the Committee? He has fingered something very important.

Dominic Grieve (Conservative, Beaconsfield)

I am not sure whether I would describe it as a plot. After all, one can read it in the Bill. However, the power is not covered by the Bill's described purpose. From that perspective, it is an unusual power, and it widens the scope of the Bill, even as the Minister described it on Second Reading. Important issues are attached to paragraphs (a) and (b), and I would be grateful to hear the Minister's justification for them, so that we can decide whether we wish to allow them to remain in the Bill, or whether we will object to them.

Alistair Carmichael (Liberal Democrat, Orkney and Shetland)

I am grateful to the hon. Member for Beaconsfield for tabling the amendments. They are very useful, and strike at a fundamental concern that I have felt throughout the Committee's deliberations on the Billthe issue of the cross-contamination between the civil functions, as laid out for the director and the Government agencies, and the criminal functions.

In earlier sittings, we gave fairly wide-ranging, swingeing powers to the director and other officers for the recovery of articles and for conducting investigations under civil procedure. I was happy to go along with that because we were dealing with civil procedure, not with something that would deprive someone of their liberty. That is an important distinction.

We have the Minister's assurances that there is a hierarchy of prosecution, recovery and so on, but that does not appear in the Bill. We were told that it cannot appear there because of drafting problems--I never quite understood what they were. I am concerned that by including subsection (1)(a) and (b) we open a back door and provide extra powers for law enforcement agencies.

In my experience, if a back door is opened, someone will use it. Perhaps not immediately, but eventually, the hard cases that make bad law will occur. Law enforcement agencies will pressure the director of the Assets Recovery Agency to use the provisions. I believe that that is wrong, and I would never have agreed to many of the things that I have agreed to elsewhere in the Bill if they had related to law enforcement. That is a step too far for criminal procedure.

When I look down the line at how the Bill will be regarded by the courts in a few years, I foresee massive problems with cross-contamination. I can envisage appeal case after appeal case being brought on points concerning the admissibility of evidence, and it will be asked how the director came to exercise those functions in the first place. To answer the point put to me earlier by the hon. Member for Glasgow, Pollok, we do not promote the cause of law enforcement by providing the enforcers with back-door powers. If we take the view that the police, Customs and Excise or any other law enforcement agency should have those powers, we should give them to them expressly. We should not do it by the back door. The Government are heaping up problems for the future.

The Chinese walls between the functions of the Assets Recovery Agency and the criminal prosecution authorities are important. It was because of them that I expressed concern earlier that the Lord Advocate was to be given the functions in Scotland. In Scotland, all those involved work in the same building, and the whole set-up would become far too incestuous and would lead to profound difficulties.

I hope that the Minister will give serious consideration to the points raised by the hon. Member for Beaconsfield about the inclusion of these provisions. There is a great deal of force in the argument that there should be a much more effective separation of powers than there will be if they remain part of the Bill.

Bob Ainsworth (Labour, Coventry North East)

Before I respond in detail, may I say one thingnot to score points, but to put something on the record? I accept that this is a serious Committee issue, but we have agreed to cull time in Committee. The Opposition know the gravitas of their various amendments, so it is pretty ridiculous to waste time in Committee so that we wind up at this time of the day

moving on to deal with substantial issues that need proper consideration, with yet more amendments. The Opposition have some responsibility to use time in Committee in an appropriate way, and not to deprive us of the opportunity to consider the later amendments properly. The hon. Member for Spelthorne has spent a lot of time on earlier amendments. Other members of the Committee objected to that. We now have just over an hour before the knife falls, and we still have very serious issues to consider.

David Wilshire (Conservative, Spelthorne)

The Minister said that he wanted to put something on the record, but that cannot go unchallenged. Whatever may have taken place this morning, he must accept that it was in order, because the Chairman allowed it to happen. The Opposition did not impose the timetabling mechanisms for the Committee. Indeed, the hon. Gentleman will probably be aware that we objected to that timetabling. The time limits were the Government's proposals, and they had a majority. The Minister may not like what is happening, but it is not for him to pick and choose, but for the Opposition to question him. Surely to goodness he has the good grace to accept that we will be the deciders of our own tactics.

Bob Ainsworth (Labour, Coventry North East)

Absolutelyand I am exposing the consequences of those tactics. It is true that the Opposition object to timetables in principle, but there was much discussion, much agreement and much flexibility. Changes were made whenever they were requested.

Alistair Carmichael (Liberal Democrat, Orkney and Shetland)

Will the Minister give way?

Bob Ainsworth (Labour, Coventry North East)

I do not want waste time now talking at length about this matter.

Alistair Carmichael (Liberal Democrat, Orkney and Shetland)

My question is short. Will the Minister be more specific about what he means when he refers to ''the Opposition''?

Bob Ainsworth (Labour, Coventry North East)

I aim nothing at the hon. Gentleman or his party; I am talking about the Opposition Whip.

Mark Field (Conservative, Cities of London and Westminster)

Will the Minister give way?

John McWilliam (Labour, Blaydon)

Order. Can we deal with the amendment?

Bob Ainsworth (Labour, Coventry North East)

Yes, Mr. McWilliam. I shall not give way to the hon. Gentleman.

Amendments Nos. 609 and 610 would delete subsection (1)(a) and (b), which allow the director to disclose information for the purposes of criminal investigation or criminal proceedings. Amendments Nos. 621 and 622 would do the same in respect of the Scottish clause. Amendment No. 617 would restrict the disclosure of information by the director for the purposes of a criminal investigation to cases when a criminal investigation was being carried out, whereas the clause currently allows for disclosure when a criminal investigation may be carried out.

The director will require statutory authority to enable him to disclose information. The clause provides that authority. It gives the director the power to disclose information for certain specified

purposes, subject to restrictions that are already set out in the clause. The provisions for the disclosure of information by the director under the clause and the equivalent Scottish provisions under clause 427 in relation to criminal investigations and criminal proceedings mirror the provisions under section 17(2)(a) and (b) of the Anti-terrorism, Crime and Security Act 2001. They apply to disclosures that may be made under, for example, the Harbours Act 1964, the Employment Agencies Act 1973, the Consumer Credit Act 1974 and the Estate Agents Act 1979.

The provisions allow the director to disclose information that he has obtained, or which has been obtained on his behalf, in connection with the exercise of his functions, if the disclosure is for the purpose of any criminal investigation that is being or may be carried out, whether in the United Kingdom or elsewhere, and any criminal proceedings that have been or may have been started, whether in the United Kingdom or elsewhere.

It seems likely that in exercising his functions in criminal confiscation and civil recovery investigations, the director will come across information that relates to criminal conduct. Indeed, that seems inevitable, given his focus on criminally or unlawfully acquired property.

As we have made clear from the outset, the Government intend that prosecution should be the primary goal. We recognise that the director's investigations may bring to light information that would be relevant to a criminal investigation, as in the case of a civil recovery or confiscation investigation. In such cases, the director must be able to refer the information to the law enforcement agencies, which might involve the suspension of his civil recovery investigation if the information involved related to the property being considered for civil recovery. That was set out in the paper that I made available to the Committee before our consideration of part 1 of the Bill, in which we outlined how we envisaged that the director would exercise his functions.

We are considering whether the director should also be able to disclose information for the two other purposes specified in the Anti-terrorism, Crime and Security Act--initiating or ending such a criminal investigation or proceedings, and facilitating a determination of whether such an investigation or proceedings should be initiated or ended. It is not clear that the power to disclose available to bodies covered under that Act should be wider than the power available to the director. If we reach that conclusion, I intend to table amendments on Report.

Alistair Carmichael (Liberal Democrat, Orkney and Shetland)

The Minister's comments seem to reinforce further the argument for specifying the hierarchy in the Bill. Does he understand the practical implications of his comments for the director and the criminal law investigation authorities? He seems to be saying that if the director comes across information that should give rise to criminal proceedings, he must slam on the

anchors, and it will go to the criminal investigating authorities, which may or may not proceed with it. The point at which the director's investigations conclude will be a grey area. That is heaping up trouble.

Bob Ainsworth (Labour, Coventry North East)

I understand the hon. Gentleman's point, and I am not trying to detract from the issue that may be involved.

When information is passed on for criminal investigation and a prosecution is subsequently brought, nothing in the Bill cuts across people's rights in respect of self-incrimination. If an attempt were made to use information gained under the director's investigating powers in that way, case law would protect the person involved against its inappropriate use. That is what will happen in the case of evidence.

In dealing with information that will not necessarily be used as evidence but subsequently becomes part of a criminal investigation--the ''bog standard'' criminal investigation, as the hon. Member for Beaconsfield described it--all the director's powers are subject to judicial approval. He must satisfy that judicial authority that he requires the information in order to carry out functions in which he is currently engaged. That safeguard is provided. He cannot simply acquire information in order to pass it on to law enforcement agencies for use in prosecution.

We intend the hierarchy to operate. All Committee members want that. The public would think that we were putting ourselves in a strange position if we set up a situation in which an agency that was pursuing the proceeds of crime came across information clearly relevant to a prosecution, yet could not pass that information to the prosecuting authorities because we had banned it from doing so. I am unsure whether the public would understand why that should happen. There are many circumstances in which other people and organisations are obliged to do that. Should we ban the director from doing that, when there is judicial oversight of all the powers that he has been given? We are addressing a substantive issue, but we ought not to go down the route that has been suggested.

Dominic Grieve (Conservative, Beaconsfield)

Yeah?

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

How is Hansard going to report that?

Dominic Grieve (Conservative, Beaconsfield)

As an exclamation, perhaps.

I listened carefully to the Minister's remarks. He persuasively made an important point. I agree with him that it would be a little odd if the director's investigations were to unearth information that could have been disclosed to another law enforcement authority during the ordinary course of its investigations, but the director was precluded from disclosing it. That could result in a failure to alert the law enforcement authority to important information with regard to the prevention or prosecution of a crime, and it could lead to additional costs, as that authority would have to search for that information independently. There is a logic to the Minister's argument.

However, there is also a problem with it. We are setting up a system that is acknowledged to be for a specific purpose--indeed, I have described it as a parallel system of justice. That is one of the reasons why I had concerns. That system is specifically targeted at money, and it specifically gives the director extraordinary powers that are unusual--if not, in some cases, novel--under our legal system.

Because they exist, those powers will be used. I fear that they will begin to be used very frequently, and for a purpose for which they were not principally intended, which will enable law enforcement agencies to obtain information that they would not otherwise have been able to get.

Alistair Carmichael (Liberal Democrat, Orkney and Shetland)

Would the hon. Gentleman care to comment on the Minister's revelation that, apparently, such information will be inadmissible, in accordance with case law? Welcome though that concession is, there is nothing in the Bill that indicates that case law continues to apply hereand as this will be an Act of Parliament, it would trump the previous case law.

Dominic Grieve (Conservative, Beaconsfield)

Two issues are at stake. First, I am not satisfied with what has been said about the information not being used as evidence. If it were capable of being passed to the other law enforcement agencies, they could gather evidence based on that information. That is not a good factor, and it is the one that worried me most. I should like to hear more from the Minister about the fact that nowhere is that spelled out in the Bill. There are provisions under which specific questions asked of an individual cannot be used, because of the protection against self-incrimination. Although people may be required to answer such questions, their answers cannot be used against them. I accept that under those provisions, such matters could not be used as evidence in a criminal prosecution. To that extent the Minister may be right, but that does not get away from the fact that it is still information that other law enforcement agencies would not otherwise be able to obtain.

Mark Field (Conservative, Cities of London and Westminster)

I entirely agree with my hon. Friend that the Bill will set up a parallel system of justice. Will he say how that marries with the Minister's assertion that there would still be a strict hierarchy? It has been asserted that the agency will play a part in the hierarchy. However, the nub of our argument is that there will be a parallel systemand, clearly, an opportunity for abuse.

Dominic Grieve (Conservative, Beaconsfield)

The difficulty is that the hierarchy envisages that the first thing is to consider prosecution. That is the top end of the hierarchyyet oddly enough, that is not where the most power lies; the most power lies lower down the hierarchy, and is given to the director for the purpose of confiscating assets or civil recovery. On the face of it, he will have powers that are wider than those of any other enforcement individual or authority in the land. He will be a powerful figure in the obtaining of information and the ability to use it for a specific purpose.

It strikes me that there is a direct conflict between the hierarchy and the way in which power is disposed. Although prosecution is at the top of the hierarchy, it is lower down the hierarchy that the most investigative

powers will be provided. Yet the Minister is asking the Committee to approve a clause that will allow information obtained for a purpose lower in the hierarchy to be fed back up to the top.

Ian Lucas (Labour, Wrexham)

Can the hon. Gentleman assist me by specifying what mechanism will come into existence whereby the steps taken by the director of the Assets Recovery Agency to obtain information will be passed on to other law enforcement authorities? Is he seriously suggesting that they will put pressure on the director to use the procedure?

Dominic Grieve (Conservative, Beaconsfield)

Pressure will not be needed. Let us suppose that the Crown Prosecution Service investigates a major crime and it cannot find the evidence, but thinks that money laundering is going on. Although it cannot bring proceedings, it tell the directora perfectly legitimate processwho carries out his investigation. During that investigation, by using his powers the director may find the evidence that the CPS has not been able to lay its hands on and feed it back to the CPS. He will then, quite unwittingly in a sense, have acted as the CPS's own investigator to obtain information under our unwritten constitution, which is the power that we give to prosecutors. The CPS will then start the wheels grinding again. It is a serious issue.

Alistair Carmichael (Liberal Democrat, Orkney and Shetland)

The sound scenario that the hon. Gentleman outlines carries a further problem. It leaves as the arbiter of what constitutes grounds for investigation and criminal proceedings staff of the director of the Assets Recovery Agency, who will not necessarily be qualified to do that work. In that sense, the interests of justice will not be well served by the provision.

Dominic Grieve (Conservative, Beaconsfield)

I entirely agree. The hon. Gentleman makes a good point. The matter will be in the hands of those whose prime responsibility is asset recovery. The Minister has properly and repeatedly emphasised that we are discussing asset recovery legislation and a system not of sending people to prison or giving them criminal convictions but of depriving them of assets. It is accepted that that will be done on a non-criminal test in some circumstances in which people already have convictions but the money involved is not necessarily linked to that conviction, and in circumstances in which no criminal conviction is involved and extraordinary powers are given that override some of the usual safeguards in our legal system.

Bob Ainsworth (Labour, Coventry North East)

So that we stay on the issue at hand, I should like to make a couple of things clear. The director does not have powers in relation to money laundering. He can use his powers only for his functions in confiscation and civil recovery.

The hon. Gentleman referred earlier to my statement about use of evidence being specified in the Bill. I apologise for having taken some time to find the reference. I refer him to clause 349(1), in which the director's main additional power--the disclosure power--is specified:

A statement made by a person in response to a requirement imposed on him under a disclosure order may not be used in evidence against him in criminal proceedings.

Overriding provisions on perjury are referred to later in that clause.

Dominic Grieve (Conservative, Beaconsfield)

That is precisely why I said what I did in response to the hon. Member for Orkney and Shetland (Mr. Carmichael). I knew that we had considered safeguards. However, the Minister must accept that that does not prevent the passage of information. It prevents the use of that information as evidence.

Mr. Ainsworth indicated assent.

Dominic Grieve (Conservative, Beaconsfield)

As the Minister nods, I believe that we agree about that.

We face a conundrum, and it is difficult to see a middle way out of it.

Mark Field (Conservative, Cities of London and Westminster)

A third way.

Dominic Grieve (Conservative, Beaconsfield)

On the whole, I am not inclined to third ways. They do not seem to have got us very far in the past five years.

I considered whether it might be possible to draft subsection (1)(a) and (b) so as to highlight the nature of the problem and ensure that the only information disclosed was information that could be obtained by the law enforcement agency with its own powers. If the Minister were to consider whether that might be a practical way to proceed, we could have a further discussion on Report, and it might commend itself to me.

I am trying to be helpful. I accept that there is a problem. Considering some examples, it might seem absurd to outsiders that the director will be unable to communicate information. However, although there may be an element of absurdity, as the Bill has been drafted for a specific purpose, my inclination is to delete paragraphs (a) and (b). We have established a director and given him specific powers for that purpose, not for general criminal investigation. The Minister is right to say that my earlier money laundering example was a bad one. Although money laundering is in the Bill, it has nothing to do with the director. Arguably, it should not be in the Bill at all, but it has been put in for the purposes of Government legislative timetabling.

That granted, my inclination is to take out paragraphs (a) and (b) and live with the consequences, because I am not happy about them. The provisions will raise huge problems that might ultimately undermine the director's credibility. His purpose could well be subverted and he could be used--although not deliberately--as an investigative agency for the law enforcement authorities. That worries me for a host of reasons. It could lead to a great many challenges under the Human Rights Act 1998.

We may regret leaving in the paragraphs, but that said, I am not unmindful of the Minister's problem. If I could see a way out of it that did not involve the elimination of the two paragraphs, I would be

receptive to it. However, at the moment, I am inclined to press the amendment to a vote.

Bob Ainsworth (Labour, Coventry North East)

Before the hon. Gentleman does that, let me intervene on him. I do not think that there is a problem with evidence. I think that we are correct on that issue. [Interruption.] I am not dead sure that the hon. Member for Orkney and Shetland is altogether with me on that.

The subject is worthy of further consideration and I am happy to provide it. I am not absolutely clear that the problem is not covered by the judicial approval that is required in the first place for the director's powers. I give the hon. Member for Beaconsfield an assurance that I will consider his points further and give him the opportunity to return to the subject, if he wishes, on Report. I shall reflect on whether I am satisfied that the point is covered by that judicial oversight. If it is not, I shall consider whether there is a way for us to cover it. I am glad that he spoke as he did, because it would be a real dilemma for us presentationally if we were to prevent information from being passed on to the prosecuting authorities. The issue is worthy of further reflection.

Ian Lucas rose

Bob Ainsworth (Labour, Coventry North East)

I give way to my hon. Friend. Oh no, I cannot, I am interveningat length.

John McWilliam (Labour, Blaydon)

At excessive length.

Dominic Grieve (Conservative, Beaconsfield)

I wonder whether, as another hon. Member wishes to contribute, it would be proper for me to sit down. Perhaps I can resume my speech later.

Ian Lucas (Labour, Wrexham)

I am grateful for the Minister's suggestion. I wonder whether, as a middle way, we could have judicial consideration of whether the information should be transferred; it should not be assumed that it always can be. Instead, there could be judicial consideration of, for example, the gravity of the information. It would be a major step for someone to suppress information relative to a serious crime and not pass it to investigating authorities. I hope that a middle way can be found, because in certain circumstances it would be right and proper for the information to be passed on, although I respect the views propounded by the hon. Member for Beaconsfield.

Bob Ainsworth (Labour, Coventry North East)

I thank my hon. Friend. I shall not try to respond to his suggestion off the top of my head. I thank the Committee for the way in which it has addressed the point, and I reiterate my commitment to a further consideration of it. In view of that, I hope that the hon. Member for Beaconsfield will withdraw the amendment.

Dominic Grieve (Conservative, Beaconsfield)

I am faced with a slight dilemma. I am minded to withdraw the amendment. My anxiety is that I do not know how long will be allocated to the issue on Reportor how many points about it the Minister will want to considerand there is always a lurking anxiety that we might end up not voting on it, even if I wished to delete it.

Alistair Carmichael (Liberal Democrat, Orkney and Shetland)

It will have two days.

Dominic Grieve (Conservative, Beaconsfield)

That is what I expected the Minister to tell me, but he knows how swiftly two days can pass.

The rest of the debate is in Hansard.