Terrorist Asset-Freezing etc. Bill [HL]

My Lords, I will make two points. The first relates to the issue that we have been debating, about which I am far from satisfied; that is, the merits of having a process under which it is the Treasury—and therefore Treasury Ministers on the advice of Treasury officials—which designates someone for the purpose of the Bill, and not a judge sitting in chambers acting on an ex parte request or application. The noble Lord, Lord Sassoon, has been extremely conscientious in answering all the points that were put to him this afternoon and I make no personal complaint about that at all. However, I repeat the point that I put to him as I was not satisfied with the response. He still has not revealed what actual practical, substantive advantage there is in having a Minister rather than a judge take responsibility for this initial, crucial act of designation. This is an enormously important matter. If there were strong pragmatic reasons relating to national security and the defence of the lives of individuals, I would be the first to say why we have to take certain action which is unpleasant and unattractive in terms of our civil liberties and why we sometimes have to strike a balance. However, those merits have not been argued and that substantive point has not been put forward and I am still completely in ignorance as to why the Minister has gone down this route rather than another. We can always speculate and say that Ministers are always inclined to give themselves extra powers whenever they can, that that is a natural instinct of government and that I am being naive in not recognising it. That is a possibility but I tried to help the Minister by suggesting that it might be a question of time. Sometimes time is of the essence in these terrorist cases. Information might come from some source or other which has to be acted on very quickly, say in half an hour, and there is not time to apply to a judge. I offered the Minister that argument if he wanted to pick it up, but he decided not to do so. Perhaps he will now pick it up in responding to me. If he will not do so, may I ask him to deliver another convincing argument—a practical, substantive argument—not just a circular evasion such as saying that it would be appropriate, a right balance or something of that kind? We need to know that, for reasons of principle and practice. I have always been brought up to believe that in a free society any decision expropriating, encumbering, seizing or freezing the property of an individual could properly be made only by the judiciary, not by executive action. I think that is a principle to which we are all attached in this country and in any free society worthy of the name. It can be overridden only for very strong reasons. Therefore, we need to hear those strong reasons. I also put forward pragmatic points, which are subsidiary and not quite so important, in favour of the judicial route. One is that, however thorough and conscientious the Minister and his officials are in these matters—I am sure that they are—they would be even more alert and thorough in their preparation if they had to go before a judge. Life is like that. The other pragmatic reason has been put in different ways in the House this afternoon. For an individual, a designation order of this kind is obviously a catastrophe. He or she may well stand to lose his or her employment—that point has already been made—but I think of someone who runs a business and suddenly finds that he cannot pay his suppliers or staff or pay back bank loans or something like that while the order is in force. He will certainly face a delay in making contractual payments while he perhaps appeals the designation or applies for a licence. Therefore, an individual may suffer a long-term and serious penalty if he is the innocent victim of an unduly hasty designation. That should make us all pause very strongly. I accept that the Government’s very welcome concession on appeals rather than judicial review means that there would be less time to wait before an appeal takes place. God knows, judicial reviews last a very long time indeed. Nevertheless, as has been pointed out, the waiting time would be a great deal longer than 30 days and would probably last some months. Therefore, it is important that there is an opportunity for a judicial sight of the issue without waiting for the appeal procedure to be triggered. I shall not pretend to the Government that I am inclined to vote against the clause even if I am not totally satisfied, because I have been entirely undercut by my noble friend the other Lord Davies, who has told me—this was news to me—that the previous Government, of which I was honoured to be a member, accepted the principle that decisions in this area should be made by executive power rather than by judicial decision. My responsibilities in the Government were in very different areas and I did not have the faintest idea at that time that this issue was being debated or decided in that way or any other. As I may be deemed to have collective responsibility for the decision that was taken, although I never said anything about it at the time, it would clearly be rather cynical or opportunistic of me to start making a big issue about it after the event. Nevertheless, I hope that the noble Lord will think that my points deserve a substantive and considered response. I greatly look forward to that. The other points I want to raise specifically in relation to the text of the Bill are those that I made in general terms on Second Reading about piracy, the hijacking of ships and aircraft and the kidnapping of individuals. As I made clear on Second Reading—no one contradicted me and, indeed, we all know that this is the case—there is a very serious practical problem at present in the Gulf of Aden. We hear about it in the media only when British ships or British nationals are hijacked or abducted. That has happened, although not in recent weeks. However, it is a very common occurrence for ships and their crews to be abducted. I am told by underwriters in the City of London that it is now a regular business for ship owners and their underwriters to pay millions of pounds in ransom money to these particular terrorists, as I call them. That is a very unfortunate situation. Those terrorists or hijackers face no real physical risks at present. They have learnt that the rules of engagement under which NATO and the EU naval forces deploy in the area mean that they will not get fired on if they do not fire in the first place. Therefore, there is very little physical downside from their point of view. There is absolutely no financial downside whatever—that is, of course, the critical point for this debate—as they can quite legally receive and hold these ransom moneys and, indeed, people can legally pay them the ransom moneys. This is an extraordinary situation in which we as taxpayers are paying for these naval forces in the Indian Ocean to try to protect world shipping and the freedom of international trade. We are putting our men and women at risk on Her Majesty’s vessels in that cause, which I believe is a good cause. Yet we are allowing these malefactors who are carrying out these hijackings to receive this money with impunity and enjoy it. This is contributing strongly to the destabilisation of Somalia and is relevant to what I am coming on to in a moment—not least to its appalling consequences for the individuals concerned and the systemic damage to international trade and so on that I have just mentioned. That is because the money received is paying for warlords, the purchase of arms, the bribing of politicians and judges, and the destruction of any stability in that country. It is a very bad story. The western world is simply sitting idly by and watching this money flow to these people. Here we have a Bill for the seizing and freezing of terrorist assets. The question is: are its provisions applicable to money received by hijackers, kidnappers and pirates? Are the provisions for protection in Clause 7 available to stop people paying this money to such individuals or groups, or are they not? The situation is somewhat ambiguous. Two categories of people or groups can be designated under Clause 1, those designated by the Treasury and those listed in Article 2(3) of Council Regulation (EC) No. 2580/2001 of 27 December 2001. So far as the persons or groups who can be designated by the Treasury are concerned, the Treasury will have regard to the definition of terrorism, which is not of course in this Bill, because it refers to ““acts of terrorism”” and defines terrorist activity in a rather circular way as, "““the commission, preparation or instigation of acts of terrorism””." It does not define acts of terrorism or terrorism, but refers in subsection (4) of Clause 2 to the definition of terrorism in the Terrorism Act 2000. I am familiar with that definition, and I am not sure that it would cover the sort of activity that I have been describing, because for such acts to be terrorist acts they would have to be politically motivated in a way that might not apply to some of the cases that I have in mind. I have also looked at the second category of ““natural or legal”” persons who could be designated, as set out in Clause 1(b). It refers to the Council regulation which I have just enumerated, which, annoyingly, does not itself contain a definition of terrorism. However, it refers to the definition of terrorism in the Council Common Position of 27 December 2001, which specifically, in Article 3(iii)(c), refers to ““kidnapping or hostage taking””, and in (e) to, "““seizure of aircraft, ships or other means of public or goods transport””." What is more, the intentional provision which establishes that in order to be an act of terrorism there must be an aim of, "““destabilising or destroying the fundamental political, constitutional, economic or social structures of a country””," is phrased in such a way that could catch the kind of assets which are derived from, or are held with a view to, paying ransoms from hijacking and kidnapping. My questions to the Government are as follows. First, does the Bill cover assets held by hijackers or kidnappers, or are held with a view to making payments to them? Secondly, if there is any ambiguity about that or any possibility of strengthening the Bill in that regard to make its provisions effectively apply to such assets, is there any intention or willingness by the Government to do so? Thirdly, if that is not the Government’s intention and if the present Bill does not meet the case, do they intend to use another legislative opportunity before too long to make sure that we have a provision for seizing money which is not currently illegal but should be, and is derived from or connected with hijacking or kidnapping? I have a fourth question: are the Government perfectly happy with the present situation and is it reasonable, although we might spend money and risk life trying to combat systematic hijacking in the Gulf of Aden, not to do anything at all to prevent the flows of money which keep that industry alive? My final point is that if nothing is done to restrict those flows and the accumulation of assets, it will undoubtedly encourage the development of an industry of piracy and hijacking—not merely in the Gulf of Aden but in other parts of the world, because it would seem to be an attractive business with little risk that can be conducted entirely within the law of the land.