Clause 1 — Temporary validity of certain Orders in Council

Terrorist Asset-Freezing (Temporary Provisions) Bill (Allocation of Time) – in the House of Commons at 8:00 pm on 8th February 2010.

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Photo of Mark Hoban Mark Hoban Shadow Minister (Treasury) 8:00 pm, 8th February 2010

I beg to move amendment 1, page 1, line 3, leave out '31 December 2010'and insert '31 March 2010'.

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Photo of Sylvia Heal Sylvia Heal Deputy Speaker

With this we may take amendment 2, line 2, leave out '31 December' and insert '31 July'.

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Photo of Mark Hoban Mark Hoban Shadow Minister (Treasury)

As I said on Second Reading, plan A had been to pass a terrorism (United Nations measures) Bill by no later than the end of March, in order to put the orders on a proper legislative footing. That plan was predicated on the Supreme Court granting the stay for which the Treasury had applied, so that Parliament could put in place the legislation needed to prevent terrorists from accessing their assets. It was on that basis that we entered into discussions with the Treasury and agreed what we felt would be sufficient time in this place and the other place to ensure that the Bill, and the views of external stakeholders interested in the process, could be thoroughly assessed so that the measures were put on to a proper footing. However, the Supreme Court's decision not to allow a stay because it would-to paraphrase the judgment-confer a sense of legality on orders that were illegal means that the emergency legislation before us today takes priority, and rightly so.

This does not mean that the Government are off the hook in terms of bringing forward a proper statutory basis for these orders. Indeed, we told the Exchequer Secretary last week that we would have been content for the Bill I mentioned to complete its stages today and for us to move on to consider the Terrorist Asset-Freezing (Temporary Provisions) Bill tomorrow, while also ensuring that after we returned from the recess, we would have a day on the Floor of the House in Committee. That Bill would then have passed to the other place where there would have been an opportunity for further scrutiny. The Bill would therefore have been on the statute book by no later than the end of March.

We have pursued that line through introducing amendment 1, as we believe that the Government should move as quickly as possible to put in place proper primary legislation. It seems to us that measures that were described in the court ruling as draconian should not be kept in place for up to 10 months on the basis of a three clause Bill that perpetuates some of the failings of the underlying orders. We believe that the Government should move more quickly so that they take responsibility for sorting out the mess they have created on their watch, rather than deferring any remedial measures until later this year.

There are some issues to be debated; we touched on a number of them on Second Reading. They include the need for proper safeguards to be in place, and the question of whether there should be a different safeguard from judicial review to look at the merits of Treasury applications. Mr. Dismore commented on the limitations of judicial review as a potential remedy, such as the fact that it could not be used to vary the terms of a licence. These issues are well known and have been fairly thoroughly debated in the context of other legislation, and we believe they are sufficiently well known for scrutiny to take place far more quickly than under the Government's sunset clause. Indeed, the hon. Member for Hendon said that, given the brevity of the Bill, his Joint Committee on Human Rights could scrutinise the Bill and publish a report quite quickly; he thought it would take a matter of days. That is entirely consistent with the timetable that would flow from our proposed sunset clause. We took his comments as a positive sign, suggesting that we could pass this legislation on a much shorter-term sunset clause than the Government suggest.

The draft Bill published last week is based largely on the 2009 order. The issues in that regard have been well rehearsed over time, and a much wider range of issues will need to be raised. Again, therefore, all the arguments point towards having a shorter-term sunset clause than that which the Government propose-31 March rather than 31 December.

The Government's sunset clause suggests, of course, that the decision on future legislation will be put off until after the next general election. The hon. Member for Hendon made the point that the House will by then have lost a great deal of its current expertise, given that about a third of Members will leave this place at the next general election. Indeed, many of the Members who took part in the Second Reading debate will not be here the other side of the general election to add their expertise to the debates. That is an added reason to accelerate this process, so we can benefit from Parliament's collective memory and knowledge of the scrutiny of the raft of anti-terrorism Bills of the last few years.

There is a clear, straightforward argument here. Our amendment 1 provides plenty of time for proper scrutiny. We are following the timetable we agreed with the Government prior to the Supreme Court deciding to quash the orders last Thursday. We believed prior to that that the timetable gave sufficient time for proper parliamentary scrutiny. Our view is that that still holds, and that we should move towards that timetable to give this Government the opportunity to clear up the mess they have created.

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Photo of David Howarth David Howarth Shadow Secretary of State for Justice

First, let me say that it would have been better if we had dealt with all the amendments before us in one large group.

Amendment 1 is an attempt to introduce a stricter sunset clause. I can see the Government's point that the end of March is very soon and there is little likelihood of full consideration of the replacement Bill being made in that time, but there needs to be a tighter timetable than the one the Government propose, which is the end of December.

The Bill allows the continuation of a situation that the Supreme Court finds obnoxious in that it undermines fundamental rights. In the words of Lord Justice Sedley, echoed by Lord Hope in the Supreme Court, the UN orders lead to a situation in which subjects of the Treasury's directions are, effectively, prisoners of the state; they are walking prisoners, of course, and two of them have walked away, but the restrictions are so tight, both on the subjects and their families, that, effectively, these people can no longer live their own lives. To echo what Winston Churchill said in 1943 about a situation in which the Executive could throw a man into prison, that is odious in the highest degree. It should not be allowed to continue one hour longer than is necessary. Our view, put forward in amendment 2, is that all the wider consultation and all the Committee consideration of the replacement Bill could be carried out before the election, and after the election it would be perfectly doable and adequate to complete all the stages of a replacement Bill by the summer recess-before the end of July.

When I was listening to the Minister, it suddenly occurred to me why the Government cannot accept our amendment-it is the reason that they cannot state: amendment 2 assumes that the election will be on 6 May or before. I accept that if this Parliament were to run its full course and the election were to be in early June, it could plausibly be argued that there would not be enough time to complete the passage of a replacement Bill by the end of July. I also accept that the Government will not admit in a Committee of the whole House on an emergency Bill what the date of the election will be -[Interruption.] Well, they might; it seems that Ministers are about to reveal the date. Of course the Secretary of State for Defence revealed it on television, but that was subsequently withdrawn.

Nevertheless, I draw the attention of Ministers to the briefing prepared by Justice, which has said that even assuming that the Parliament runs its full course it should be possible to get the replacement legislation through by the end of October. Thus, I am very open to the Government rethinking the December date in favour of an October one, even if they are unwilling to move to a July date, for obvious political reasons.

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Photo of Sarah McCarthy-Fry Sarah McCarthy-Fry Parliamentary Secretary, HM Treasury

Obviously the purpose of both amendments is to reduce the period during which the temporary Bill will have effect. Our Bill provides for a date of 31 December, whereas the amendments propose two alternative dates-31 March and 31 July. I think that we are all agreed on the urgent need to get the long Bill on to the statute book as soon as possible, so the issue to address is how much time is needed to give the lasting legislation the proper level of scrutiny and debate. We believe that the lasting Bill deserves full deliberation in both Houses and that it should benefit from evidence and scrutiny provided by external bodies. The proposed date of 31 December provides for that, but the period up to 31 March does not. Given that the urgent need to legislate is resolved by this Bill, we think that the issues deserve more time for consideration so that we can be sure that the legislation is appropriate. If the debate and arguments put forward on Second Reading of this Bill are anything to go by, there will be a vigorous debate.

Using 31 July would provide more time and the option of pre-legislative scrutiny in the coming months. However, given the upcoming general election and recesses, it is not certain that such a date would provide time to scrutinise the long Bill properly. I have heard views from hon. Members on both sides of the House in favour of 31 December, as well as arguments in favour of 31 July -another date has also been proposed. I look forward to listening to any other arguments that are put forward, but I urge right hon. and hon. Members to reflect on the lasting benefits of permanent legislation. I really do not think that setting a close deadline helps, so I ask the hon. Members for Fareham (Mr. Hoban) and for Cambridge (David Howarth) not to press their amendments to a Division.

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Photo of Mark Hoban Mark Hoban Shadow Minister (Treasury)

What a difference a week makes, because a few days ago the Minister was happy to push the long Bill through and to reach the deadline of the end of March, and she did not really care that much about pre-legislative scrutiny and getting external voices in. Her approach was just to make sure that we got the Bill on to the statute book in good time.

In a way, the Supreme Court has perhaps given the Minister an opportunity to wriggle out of that, but the real argument is about the fact that to get the long Bill on to the statute book will take up two days of time in this place and three days of time in the House of Lords. Given that legislative time is disappearing because this Parliament is hurtling towards Dissolution, the Government cannot afford to give up that amount of time to put right the mistakes of their own creation. They need to put right the fact that they failed to put in place the primary legislation to give proper backing for these orders. The Government are hiding behind the excuse of wanting to give proper scrutiny to avoid time being taken up putting this Bill on to the statute book as soon as possible to give those orders the support that they need. That is why I wish to put amendment 1 to the vote. We need to send a clear signal from this Committee that we want to ensure that the mistakes committed by the Government are put right quickly. We believe that they can be put right quickly, with proper parliamentary scrutiny, by 31 March.

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Question put, That the amendment be made.

The Committee divided: Ayes 125, Noes 307.

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Question accordingly negatived.

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Photo of Sarah McCarthy-Fry Sarah McCarthy-Fry Parliamentary Secretary, HM Treasury

I beg to move Government amendment 8, page 1, line 5, at end insert-

'(aa) the Terrorism (United Nations Measures) (Channel Islands) Order 2001 (S.I. 2001/3363), the Terrorism (United Nations Measures) (Isle of Man) Order 2001 (S.I. 2001/3364) and the Terrorism (United Nations Measures) (Overseas Territories) Order 2001 (S.I. 2001/3366);'

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The First Deputy Chairman:

With this we may take the following: Government amendments 9 to 11.

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Photo of Sarah McCarthy-Fry Sarah McCarthy-Fry Parliamentary Secretary, HM Treasury 8:30 pm, 8th February 2010

It is important that we maintain our terrorist asset-freezing regime not just in the UK, but for the Crown dependencies and overseas territories. Although the Orders in Council that apply to the Crown dependencies and overseas territories were not directly before the Supreme Court, they were also made under section 1 of the United Nations Act 1946 and are therefore vulnerable to being quashed. Amendment 8 therefore adds the Terrorism (United Nations Measures) (Channel Islands) Order 2001, the Terrorism (United Nations Measures) (Isle of Man) Order 2001 and the Terrorism (United Nations Measures) (Overseas Territories) Order 2001 to the list of orders that are validated by the Bill. If we do not make that change, we will leave the Crown dependencies and the overseas territories without a robust terrorist asset-freezing regime, and we would not fully meet our obligation under UN resolution 1373.

Amendments 9 and 10 validate decisions made by the authorities of the Isle of Man, the Channel Islands and the overseas territories by ensuring that it is not only decisions of the Treasury that are validated. The amendments are consequential to amendment 8. If we want the Isle of Man, the Channel Islands and the overseas territories to be covered, the amendments are also needed. Amendment 9 applies to decisions to issue a direction-that is to make a designation-and amendment 10 applies to decisions to grant a licence.

Amendment 11 is also a consequential amendment, which is necessary to implement the previous amendments. It extends the territorial scope of the Bill to the Crown dependencies and the overseas territories for their respective orders only.

Amendment agreed to.

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Photo of David Howarth David Howarth Shadow Secretary of State for Justice

I beg to move amendment 4, page 1, leave out lines 9 to 11 and insert-

'are declared to have the same legal force as primary legislation'.

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The First Deputy Chairman:

With this we may take the following: amendment 5, page 1, line 11, at end insert-

', but subject to the amendments made by section [Amendments to the 2009 Order]'.

Amendment 6, page 1, line 11, at end insert -

'( ) In section 63(1) of the Counter-Terrorism Act 2008, add at the end-

"(d) The Terrorist Asset-Freezing (Temporary Provisions) Act 2010.".

Amendment 7, page 1, leave out lines 13 to 19 and insert-

'(a) directions purported to be made by the Treasury under the purported Orders mentioned in (2) shall have effect as if they were interim orders;

(b) licences purported to be granted by the Treasury under purported directions shall have effect as if they had been granted under this Act.'.

New clause 1- Amendments to 2009 Order -

(1) The Terrorism (United Nations Measures) Order 2009 is amended as follows.

(2) In article 4(1) for "The Treasury may give a direction that a person identified in the direction is" substitute "The High Court, on application by the Treasury, may order that a person be".

(3) In article 4(1 )(b) for "the Treasury consider that the direction" substitute "the order".

(4) In article 4(2) delete "that the Treasury have reasonable grounds for suspecting".

(5) In article 4(3) for "Treasury" substitute "Court".

(6) After article 4(3) add-

"(4) The Court may, on application by the Treasury, make an interim order under which a person is to be treated as satisfying the conditions in paragraph (1) if there is reasonable suspicion that the conditions in paragraph (l)(a) and (l)(b) are both satisfied.

(5) The Court must discharge an interim order if-

(a) there are no longer grounds for reasonable suspicion that the conditions in paragraph (l)(a) and (l)(b) are both satisfied,

(b) any subsequent proceedings undermine the factual basis for the finding that there is reasonable suspicion for the purposes of paragraph (4),

(c) a Court makes an order under paragraph (1) relating to the same person arising out of the same allegations, or

(d) a Court refuses to make an order under paragraph (1) relating to the same person arising out of the same allegations.

(6) Nothing in paragraph (5) prevents an application by the Treasury for a new order or interim order on the basis of different facts.".

(7) For article 5 substitute-

"5 (1) An order under article 4(1) must be revoked by the Court if either of the conditions identified in that article no longer continue to be met.

(2) An order under article 4( 1) may last no longer than 12 months, but may be renewed on application by the Treasury.

(3) An interim order under article 4(4) lapses after one month, and may not be renewed except where there are pending proceedings under article 4(1) or other proceedings relevant to the issues identified in articles 4(5Xa) or (b), in which case the interim order may be renewed on application by the Treasury until the end of those proceedings and any consequent proceedings under article 4(1) or article 4(5)(a) or (b).".

(8) For article 6(1) substitute-

"(1) Where the Treasury makes an application to the Court under articles 4 or 5, the Treasury must-".

(9) In articles 6(l)(a), 6(l)(b), 6(2)(a), 6(2)(b), 6(3) and 6(4) for "direction" wherever it appears substitute "application".

(10) For article 7 substitute-

"7 (1) Whenever any of the following occurs, the Treasury must act in accordance with paragraph (2)-

(a) an order or an interim order expires,

(b) the Court varies, revokes or renews an order or an interim order, or

(c) the Treasury makes an application to the Court for any renewal, revocation, or variation of an order or an interim order.

(2) (a) The Treasury must give written notice to the person indentified in the order or interim order,

(b) The Treasury must take such steps as they consider appropriate to bring any event mentioned in paragraph (1) to the attention of persons informed of the order.".

(11) In articles 8 and 9, for "a direction" wherever it appears substitute "an application for an order or an interim order".

(12) In articles 8 and 9, for "the direction" wherever it appears substitute "the application for an order or an interim order.".

(13) In article 8( 1) and article 9, for "4( 1)" substitute "4".

(14) In article 8( 1) and article 9, for "5( 1)" substitute "5".

(15) In article 9, for "that direction" substitute "that application for an order or an interim order".

(16) After article 17(7) insert-

"(8) (a) if the Treasury refuses an application for a licence under this article or refuses to vary the terms of such a licence, any person affected, including the restricted person and the applicant for a licence, may appeal to the High Court,

(b) the High Court on an appeal under sub-paragraph (a) shall consider the application ab initio and may make any order it considers appropriate.".

(17) In article 23, for "7(a)" substitute "7(2)(a)'".

Amendment 12, Title, line 3, after 'activity;' insert-

'to amend the regime established by those Orders;'

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Photo of David Howarth David Howarth Shadow Secretary of State for Justice

All the amendments and the new clause stand in my name and that of my hon. Friend Dr. Cable. They bring together two separate issues-one that relates to amendment 4 and one that relates to amendment 5 and the new clause. The other amendments are simply consequential. Having heard the debate in the House all day, I feel that the issue that concerns amendment 5 and the new clause is the one on which Members wants to vote, so I shall press that to a Division.

Amendment 4 would change the terms that the Government use to turn the previous UN orders from invalid legislation into valid legislation. The way in which the Bill works is to deem the orders to be valid, and always to have been valid, under the United Nations Act 1946. The amendment would excise any mention of the Act from the Bill and, instead of deeming the orders always to have been valid, would simply declare them to be valid from now on. The amendment would therefore remove an element of retrospectivity in the technique that has been adopted and, more importantly, would remove from the Bill any reference to the Act as a cover for what the Government are trying to do. The reason for that has to do with the al-Jedda case.

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Photo of Mark Hoban Mark Hoban Shadow Minister (Treasury)

Before the hon. Gentleman talks about that case, will he clarify something? Would his amendment effectively nullify any action taken under the orders prior to the passing of the Bill?

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Photo of David Howarth David Howarth Shadow Secretary of State for Justice

Not quite, because of what clause 2 does. To achieve that effect, we would have to vote against clause 2. I am not so annoyed about clause 2 as I am about clause 1, because clause 2 is there to protect the banks, rather than the Government. I know that the banks are unpopular, but it seems reasonable that having relied on what the Government did, the banks should be protected from any untoward consequences; the Government are in a different position.

The judgment in the al-Jedda case states that in circumstances where the Government are legislating to implement a United Nations Security Council resolution, the Human Rights Act and the European convention on human rights do not apply. That is because article 130 of the UN charter says that the UN charter and Security Council resolutions under the charter take precedence over every other treaty. In the al-Jedda case, the House of Lords interpreted that provision as including in the category of all other treaties the European convention. Because of the relationship, as found in other cases, between the European convention and the Human Rights Act, that also means that the Human Rights Act does not apply.

All through the debate, that has been an important point of interpretation of the Supreme Court, because the Supreme Court did not say that the orders were compliant with human rights standards. It said instead that because of the al-Jedda case, it was unable to consider whether human rights standards applied or not. Unless, of course, the al-Jeddah case is reversed on appeal to the European Court of Human Rights in Strasbourg, amendment 4 would leave it open to those affected by this legislation to go to court in this country and challenge it on the basis of human rights standards and to move to obtain a declaration of incompatibility. That is a possibility that we should leave open. We should not slam the door in the face of the courts as the Bill does.

The Chief Secretary has a personal interest in this, because he has certified on the front of the Bill that it complies with the European convention on human rights. At present, that might be a slightly misleading statement, because that might be true only because the convention does not apply at all. I hope that he would wish that the position was more real than that rather artificial one, and that he would argue-I might oppose him on this-that the terms of the Bill are, in reality, compliant. The argument for amendment 4 sounds technical, but it raises a very important issue of principle about the application of the Human Rights Act.

Amendment 5 is a paver for the new clause. The new clause is an attempt to amend the 2009 order in a way that has been called for from all sides of the Chamber in the debate that we have had so far. Its effect is to alter the process by which a person becomes subject to the asset-freezing regime, to change the length of time that a person can be subject to the regime on the basis of reasonable suspicion alone, and to introduce appeal mechanisms both for the bringing into force of the asset-freezing regime and for the licensing regime-a point that has been mentioned in the debate.

Under the order as it stands, the Treasury, acting on the basis solely of reasonable suspicion, and without any prior supervision by the courts, can subject a person to the full asset-freezing regime. There is absolutely no appeal. There is judicial review, and we have debated its adequacy, but the conclusion that I and many other right hon. and hon. Members have come to in the debate is that judicial review is not adequate. There is not only no provision for an appeal, but no limit to the number of times that a direction, which lasts a year, may be renewed. Effectively, that is an indeterminate-life-sentence. The Government say that they will change their ways and the directions will work differently, but in the past they have worked punitively, not just preventively. We all accept that the object of the exercise is to prevent funds going to terrorist organisations, not to punish people who are merely suspected-without any proof in court-of associating with terrorists.

The proposed changes would replace the existing process with one in which the Treasury applied to the High Court for an order to impose an asset-freezing regime. The Court, not the Treasury, would apply the order based on the facts-as in the Australian regime that has been mentioned-about whether the person was connected with terrorism and whether it was necessary to impose the order for public protection. Reasonable suspicion would not be enough; a judgment would have to be made on the basis of the facts as they were, not as the Government simply suspected them to be. The order would last for up to a year, but then, as now, its renewal would be possible through a further Treasury application, which would be judged on the same basis as the first.

I accept, however, that there are emergency circumstances in which applying for a full order might lead to excessive risks. In that situation, the proposed changes would allow the Treasury again to apply to the Court for an interim order, but then, as now, it would be able to do so on the basis of reasonable suspicion. The interim order would be restricted in a way that the Supreme Court itself said was reasonable; it would last only for a month, during which time the Treasury would be expected to apply for a full order; and its extension would be possible only to cover the proceedings on the full order or the time that it took to deal with other relevant proceedings, such as a criminal trial or those under other terrorism legislation.

The 2009 order includes a licensing system, to which Members from all parts of the House have also referred. The regime's problem, which has already been recognised, is that there is no provision for an appeal against the refusal of a licence or against a licence being granted in terms that the persons affected-the subject of the order or their family-find too restrictive. We all know the affects of such orders, especially on the wives of subjects. Several marriages have broken up; there have been mental health problems; and orders have been so restrictive that they have required mothers to ask every day of their children what money they have spent-even on sweets in the local sweet shop. Our new clause would therefore allow full appeals, not just reviews, by anyone who was affected by a licensing order and felt that the licence was too restrictive or wanted to appeal against the refusal of a licence in the first place.

Although this is emergency legislation, and although there is a feeling on all sides that something has to be done quickly, that does not mean that we should carry on doing something that is plainly wrong. It is plainly wrong to give the Executive the power, merely on suspicion, to lock people up without proper, full access to the courts. I come back to what Lord Atkin said in Liversidge v. Anderson, a case that all law students know: amid the clash of war, the laws are not silent. We will debate the question of whether this is a war on other occasions; nevertheless, the law should not be silent.

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Photo of Mark Hoban Mark Hoban Shadow Minister (Treasury) 8:45 pm, 8th February 2010

I find it a bit rich for David Howarth to propose these amendments and this new clause given that he voted against the idea of having a sunset clause that lasted until 31 March because he felt that that would not provide enough time for proper consideration of the draft Bill. Yet he is proposing a set of amendments and a new clause that would fundamentally change the law in this area, and he thinks it appropriate to deal with them in the space of an hour and a half on a Monday night without proper exposure to the wider world. I know that consistency is not necessarily a virtue for which Liberal Democrats are renowned, but he needs to be consistent about this matter. This is not the appropriate occasion on which to introduce into the Bill safeguards of the kind that he has outlined, which would open the door to enabling these provisions to be challenged through the court system on the grounds of human rights.

I am happy to acknowledge that the hon. Gentleman raises some fundamental issues. There are important issues to be debated but, given that there is a sunset clause in the Bill, I question whether now is the right time to do so with an expectation of changing the law to this effect. He may well say later that these are probing amendments, not a huge attempt to change the law, and that may be fine, but he gave no indication that that is the case. This is not an appropriate opportunity to debate such fundamental reforms, which would need proper scrutiny and engagement with external stakeholders, and I am a bit surprised that he has chosen to table these amendments at this time.

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Photo of Elfyn Llwyd Elfyn Llwyd Shadow PC Spokesperson (Home Affairs), Shadow Chief Whip (Commons), Shadow Spokesperson (Business, Innovation and Skills), Shadow Spokesperson (Energy and Climate Change), Shadow Spokesperson (Environment, Food and Rural Affairs), Shadow Spokesperson (Foreign and Commonwealth Affairs), Shadow Spokesperson (Justice)

I rise to support the amendments, as I believe that they would be a very helpful step forward. Mr. Hoban said that it is a bit rich of the Liberal Democrats to vote in the way that they did. I voted that way, as well, but I am equally concerned about the purport of this Bill.

As we have heard, there are two main issues regarding what the Bill does: a lack of scrutiny and a lack of legal redress, both of which would be dealt with in the second amendment to which David Howarth referred. Like others in this Chamber, I am sure, when I hear the words "reasonable suspicion" I always think, "How is that tested?" Usually, the normal legal procedure then comes in, and a tribunal of some kind decides whether the suspicion was held on a reasonable basis. In this instance, there is no such tribunal to make that decision. I am not here to cast any aspersions on the Exchequer Secretary, the Chief Secretary or anybody else, but we would hope to put in place a form of legislation that will stand the test of time and be a fair resolution of a problem that, I acknowledge, does exist. I do not live in a cocoon: there is a problem, and I recognise that that is so. As we are going to rush everything through today, this is obviously an appropriate time to discuss these amendments, because when can we discuss them, if not now? Surely it is important that we consider them now.

Of course the Government might care to respond in some way to the purport of the amendments in due course. As we heard earlier, Lord Hope, the deputy president of the Supreme Court, said:

"It is no exaggeration to say...that designated persons are effectively prisoners of the state...their freedom of movement is severely restricted without access to funds or other economic resources, and the effect on both them and their families can be devastating."

He went on to say that the orders

"strike at the very heart of the individual's basic right to live his own life as he chooses."

His colleague in the Supreme Court, Lord Brown, said:

"The draconian nature of the regime imposed under these asset-freezing Orders can hardly be over-stated."

David Howarth said that his amendment would make the Bill human rights compliant by deleting the reference to the UN. I think that that is basically where we are. He is a law professor, and although such matters are detailed, he explained them clearly. It is not a simple area of law, but I agree that that would be a sensible way forward. It would at least invoke the protection of compliance with human rights as we understand them.

New clause 1 would impose a duty of scrutiny. It would also give the courts an opportunity to review a finding later-there is nothing wrong with that, one hopes-and give the person subject to the order some form of legal redress. As hon. Members from all parties said, merely falling back on the old excuse that a person can seek redress by way of judicial review is not good enough. The people we are discussing are asset-stripped. How are they to finance an application for a judicial review?

In any event, the judicial reviews that we have discussed are subject to the Wednesbury principle. In other words, the major question is whether the Minister concerned acted reasonably in the circumstances. If only part of the information against the individuals designated is known to them, how on earth can they possibly challenge on those grounds? Mr. Dismore made that point clearly.

The amendments are certainly an improvement on the Bill. The hon. Members for Twickenham (Dr. Cable) and for Cambridge must have spent a boring weekend considering so many minute drafting points. Maybe the hon. Member for Twickenham was not in Twickenham, as I was, but that is another story. I had a legal low, not a legal high, but I digress.

The amendments are seriously worthy of consideration and improve the Bill. I am unhappy about the Bill, but I understand that the Government are in a bit of a quandary and need to do something. However, if we are to have these time constraints, surely we should be able to discuss the measures in detail so that some form of protection could be built into the Bill. The hon. Member for Cambridge has done a good job of drafting his amendments in such a short time. I hope that the Government can respond to them positively.

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Photo of Sarah McCarthy-Fry Sarah McCarthy-Fry Parliamentary Secretary, HM Treasury

I thank all hon. Members for their contributions to the debate on the amendments, including David Howarth, who moved them, Mr. Hoban, who spoke for the Opposition, and Mr. Llwyd, if I have pronounced that correctly.

Before I address the amendments, I want to correct a point about the al-Jedda case. The case concerned the relationship between United Nations obligations and the European convention on human rights, when there is a conflict between the two. In al-Jedda, the House of Lords concluded that UN obligations override convention rights. That is, UN obligations take precedence when there is a conflict. However, the al-Jedda point arose in our case in relation to the al-Qaeda order only, which the Bill does not address. Individuals do not have a right of access to a court to challenge their designation. The al-Jedda point did not arise in relation to the terrorism orders-the subject matter of this Bill-because those orders do not contravene human rights in that way.

Amendment 4 is intended to ensure that the orders have the same legal force as primary legislation. Amendment 6 adds a reference to the Bill in part 6 of the Counter-Terrorism Act 2008. I reject both amendments because I do not think they are needed, and I hope that the hon. Member for Cambridge will withdraw them. Giving the orders status as primary legislation would give the Government more protection from legal challenge than we believe would be right. The orders could not then be quashed by a court on human rights grounds. That is because a court can strike down an Order in Council on human rights grounds, but it can only declare an Act of Parliament incompatible with the Human Rights Act 1998. Our short Bill will ensure that our Orders in Council can continue to be set aside on human rights grounds until the permanent Bill is enacted. Adding a reference in the Bill to the Counter-Terrorism Act 2008 is unnecessary because the Act already covers all decisions made under our orders.

I move on now to amendment 5, new clause 1 and amendment 12. I listened with interest to the arguments that the hon. Members for Cambridge and for Meirionnydd Nant Conwy put forward. I want briefly to go back over why I feel that the substance of the proposals is wrong, but the main issue is that these are arguments for us to have on the longer Bill.

Accepting the proposals would fundamentally change the nature of asset freezing. It would mean all freezing decisions being taken by the courts, and not by Ministers as at present. Ministers would be able only to refer freezing proposals to the High Court. Freezes based on reasonable suspicion could last for only one month, and would be renewed after a month only if a court could be persuaded that the subject were a terrorist. That would involve a higher test than reasonable suspicion, and it could be a test as high as a conviction. The changes would significantly reduce the operational effectiveness of the asset-freezing regime, which is designed to be preventive.

Reasonable suspicion is a legal basis for asset freezing which is endorsed by the Financial Action Task Force. Under the current system, we do not simply rely on reasonable suspicion, however. Designations must also be necessary for public protection, which provides an additional safeguard. The proposals in these amendments would alter key aspects of the regime, including who made the decisions and what the legal standards should be. Those are fundamental points. The purpose of this temporary Bill is not to remake our asset-freezing regime; it is to restore the existing regime for a temporary period to allow for thorough consideration of the full Bill.

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Photo of Martin Horwood Martin Horwood Shadow Minister (Environment, Food and Rural Affairs)

Am I right in thinking that, when a suspension of the Supreme Court's decision was requested, the Court refused it on the ground that it would simply be

"a procedure that is designed to obfuscate the effect of its judgment"?

In other words, did not the Court expect us to change the principle behind the regime, rather than simply try to find a way round its judgment?

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Photo of Sarah McCarthy-Fry Sarah McCarthy-Fry Parliamentary Secretary, HM Treasury

No, the basis for the judgment for not giving us a stay was that the Court did not have a legal basis to do that, given that it had quashed the original orders.

Many hon. Members have talked today about not rushing into legislating on issues of importance. The problem that I have is trying fundamentally to rewrite our existing scheme with a bare minimum of discussion and scrutiny in the few hours that we have had tonight. I look forward to debating the substance of the hon. Member for Cambridge's proposals in due course, but the time to debate such significant changes is when we consider the permanent legislation in detail, not now. Our priority now is to restore our existing regime, as the Bill seeks to do, and to create time for us to consider in greater depth how the permanent legislation should be framed. On that basis, I invite the hon. Gentleman to withdraw his amendment.

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Photo of David Howarth David Howarth Shadow Secretary of State for Justice 9:00 pm, 8th February 2010

The Minister made a legal point at the start of her speech, but I do not think she could fully have considered the judgment by Lord Phillips in the Supreme Court, who clearly considered the position under al-Jedda and the human rights position before discussing the individual merits of the cases against either order. What the Minister put to the Committee was not the legal position, but simply her hope about what the legal position might be, were the matter to return to court-which, I am afraid, is where it will probably end up.

The arguments against the amendments seemed simply to be that the time is not ripe to discuss the detail of these provisions, but we are being asked to put them into force for almost another year. I remind the Committee that the Supreme Court was very clear about the degree to which these orders undermine fundamental rights. Mr. Hoban talked about consistency, and we consistently voted against the timetabling order earlier today because we thought it would be better to discuss these matters in more detail with more time. However, we have to deal with the time we have, and the very least we can do in that time is to put right the main injustices and faults of the legislation before us. That is what the amendments attempt to do.

In particular, the new clause, and amendment 5 which would pave the way for it, would put right the most obvious faults in the legislation-faults that the hon. Gentleman's own Back-Bench colleagues referred to again and again in their speeches on Second Reading. They included the lack of appeal and of judicial process. We do not have to wait for months to put that right: we can do so here and now.

Amendment 4 deserves further discussion, and the Government's response shows that they need to think about it a lot more, but amendment 5 is something that we should vote on here and now. I beg to ask leave to withdraw amendment 4.

Amendment, by leave, withdrawn.

Amendment proposed: 5, page 1, line 11, at end insert-

', but subject to the amendments made by section [Amendments to the 2009 Order]'.

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Question put, That the amendment be made.

The Committee divided: Ayes 53, Noes 254.

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Question accordingly negatived.

Amendments made: 9, page 1, line 13, leave out

'by the Treasury under any of'

and insert 'under'.

Amendment 10, page 1, line 15, leave out

'by the Treasury under any of'

and insert 'under'.- ( Sarah McCarthy-Fry .)

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

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Photo of David Howarth David Howarth Shadow Secretary of State for Justice

I will be very brief. I simply want to say that although we did not object to the Bill receiving its Second Reading, we find the methods adopted by the Government in clause 1, especially now that they have not been amended in any significant way- [ Interruption. ]

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The First Deputy Chairman:

Order. There really are far too many private conversations going on in the Chamber. It is difficult to hear what the hon. Gentleman is saying.

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Photo of David Howarth David Howarth Shadow Secretary of State for Justice

Thank you, Mrs. Heal. As I was saying, although we did not vote against Second Reading and we accept the need for action on this issue, we are disappointed that the Government seem so obdurate, in resisting any suggestion to improve how the main part of the Bill-clause 1-works, and especially in their utter complacency on the issue of human rights and their refusal to accept the need for proper scrutiny, review and appeal. For that reason, I shall be advising my colleagues to vote against clause 1 stand.

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Photo of Sarah McCarthy-Fry Sarah McCarthy-Fry Parliamentary Secretary, HM Treasury

I am rather disappointed with the Liberal Democrats' position. As a Government we want to ensure that the Bill has sufficient scrutiny as it goes forward. I made it clear in my response to the amendment proposed by the hon. Gentleman that I do not think it appropriate that such a fundamental change should have been made with less than a few hours' scrutiny. As I said to him, I look forward to debating those points as we go forward. I am very disappointed that the Liberal Democrats are choosing to vote against a clause that prevents terrorists from having access to financing or the financial system. Quite frankly, it is shameful.

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Question put, That the clause, as amended, stand part of the Bill.

The Committee divided: Ayes 302, Noes 42.

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Question accordingly agreed to.

Clause 1, as amended, ordered to stand part of the Bill.

Clause 2 ordered to stand part of the Bill.

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