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Mr. Mike Hancock (Portsmouth, South): On the same point, will the Minister give an assurance that police forces will inform all those who hold firearms certificates of their rights and of the starting date of the scheme before 1 July? Will he also assure the House that police officers in police stations that will receive firearms and equipment will be familiarised with the various documents that will have to be submitted, to save problems occurring after firearms have been surrendered?

Mr. Michael: I assure the hon. Gentleman that much time and thought have been given to those arrangements. As he will be aware, several constraints apply to how we deal with the situation. Decisions first have to be taken by Parliament--that is why we are having a debate about the scheme now--before the police receive the information, to pass it on to the people who will need to surrender weapons. At the same time, we have had to give people an opportunity to make representations about the content of the scheme and to find parliamentary time for the debate.

The police will be allowed only a short time to get ready, but we decided--after consulting widely and discussing the issue with the police--that we should proceed as quickly as possible on the time scale that I suggested. To my knowledge, the police have made considerable efforts to ensure that everybody who will deal with the scheme is fully trained and aware of the arrangements. The time scale is tight, but the police have assured me that they will do all that they can to ensure that everybody is properly informed.

Time will be available after 1 July--not everything has to be done by then--and every effort will be made to ensure that the police have the information they need, if the House agrees the scheme tonight. The police will pass the information on as quickly as possible to shooters so that they can make their applications and hand in their weapons in an orderly manner. I am sure that all the Members who were involved in the earlier debates realise that the House and the public wanted the legislation to be implemented as quickly as possible once the decisions of principle had been taken.

Mr. Nicholas Winterton (Macclesfield): The Minister is dealing well with this sensitive and difficult issue, and the House is grateful to him. Will he tell the House with which representative bodies and trade associations he has discussed the levels of compensation? What response has he received from those organisations about the level of compensation? I ask that because I have an important company in my constituency, which is the largest wholesaler of arms and ammunition in the country.

Mr. Michael: It would take some time to list all the organisations that were consulted. Officials have consulted widely with all the organisations that, over a long time, have expressed interest, including the sporting bodies representing shooters and business interests. There has been detailed discussion.

There are those who are concerned, of course, about the business that they will lose as a result of the scheme's implementation. Indeed, there are those who would wish

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to take compensation further into compensating firms for loss of business. We have made it clear that we shall not go further than what has already been set out. That was the previous Government's position. Compensation is not always made available for loss of business--for example, where pharmaceuticals are removed from general availability. It would be surprising if we were satisfying everyone, especially as there are those who did not want the proposed legislation to become law.

Those who have an interest did not want to see legislation introduced and implemented. At the same time, many of those who were involved in consultations, whether in business or in sport, have sought to find a sensible outcome. That is surely the right approach.

Mr. Gerald Howarth (Aldershot): Will the Minister give way?

Mr. Michael: I shall give way, but perhaps I should make some progress. Hon. Members may wish to make their own speeches.

Mr. Howarth: The Minister said that certain categories of weapon will be held by the police or for training purposes. It seems that other weapons will be placed in museums or elsewhere. I see no reference to those disposals in the scheme. Will the Minister expand on the quantity and category of weapons that he is talking about?

Mr. Michael: I am talking about very small quantities of weapons. That question applies not to compensation but to primary legislation. I understand that the point was taken up by my predecessor. We are dealing now with compensation. We must be concerned, of course, with the disposal of weapons and ancillary equipment, the majority of which will be destroyed under the arrangements that I described.

Once a claim has been settled and the claimant has no further interest in the guns and equipment, the FCS will issue disposal instructions to the police force storing the weapons and equipment, and those will be destroyed in accordance with the local force practice. That will follow discussion with the police about the best way to deal with those issues.

I move on to the detailed values in the scheme. Sections 16 and 17 of the Act make it clear that weapons and ancillary equipment must have been in the claimant's possession on or immediately before 16 October 1996, the date of the previous Government's announcement of their response to Lord Cullen's report.

The draft scheme uses the values of weapons and equipment in the period immediately before that date. The values listed in annexes A, B and D reflect the advertised prices as new in trade journals at that time minus 25 per cent. for normal depreciation. Those are notional prices that we believe individuals might have obtained had they sold their guns or equipment at that time.

As for individuals who submit independent evidence of the retail value of their guns and equipment and claim under option C, the FCS will normally pay out the retail value less 25 per cent. to reflect normal depreciation. For dealers who submit independent evidence of the value of their stock and claim under option C, the FCS will

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normally pay out the cost price plus 25 per cent., which is a fair reflection of the return that could have been expected had the stock items been sold on.

Officials have had contact with a number of gun dealers, and the dealers' views have been taken into account during the preparation of the draft scheme, as I said. We have used published or advertised values of guns and equipment as they have appeared in trade journals and other sources, rather than the values cited by one or more of the dealers whom we have consulted. That is the best way of obtaining fair values, both for claimants and ultimately for the taxpayer, whose interest also has to be considered.

There will be some concern about the position of dealers, gun clubs and others who will suffer losses as a result of the ban coming into effect. I referred to that concern a few moments ago, in my response to the hon. Member for Macclesfield (Mr. Winterton). That matter was debated at length in the House during the passage of the Firearms (Amendment) Act 1997. It was decided at the time that such losses should not fall within the terms of the Act. The draft scheme therefore enables dealers and others to be compensated only for the weapons and certain ancillary equipment that they hand in. It does not extend to business losses, or to equipment used in the manufacture of prohibited guns or ancillary equipment.

Finally, I must make the position on small-calibre pistols clear. They do not form a part of the draft scheme because they are not prohibited by the Act. The Government intend, however, that there should be a free vote in the House. If the Firearms (Amendment) Bill is passed, that category of handgun will also become prohibited. We shall debate that later this week.

With that expectation, certificate holders and dealers who own small-calibre pistols may hand in those weapons voluntarily to designated police stations at the same time as the other handguns are surrendered. They will have to complete an application form, which will be processed by the FCS, and then they will receive ex gratia payments for those weapons and for related ancillary equipment. Details of those payments are already available in the Library of the House and will be circulated to all claimants at the same time as the details of the compensation scheme. The values of the ex gratia payments have been calculated in exactly the same way as for the main lists--on the basis of the market values in the period immediately prior to last year's statement on 16 October.

If the Firearms (Amendment) Bill is passed, the ex gratia list will become a formal scheme in its own right. That will not be the subject of today's debate, but will be debated during the relevant stages of the Bill.

The arrangements that we have made are a sensible way of ensuring that people who want to hand in their weapons can do so in one fell swoop, rather than having to do it in dribs and drabs; the arrangements are intended as an encouragement, to get as many handguns as possible out of circulation.

The Government believe that the draft scheme is fair and will properly compensate legitimate owners of prohibited weapons and related equipment. I commend it to the House.

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10.56 pm

Mr. David Maclean (Penrith and The Border): We welcome the publication of the compensation scheme for higher-calibre handguns made illegal by the Firearms (Amendment) Act 1997. I am grateful to the Minister of State for responding to my pleas during the past few days about the differences between the scheme that was originally laid and the scheme before us.

I appreciate the difficulty of drawing up the scheme and the complexity of combing through hundreds of detailed assessments of different weapons and bits and pieces of equipment. It is an area in which it is difficult to be exact.

I do not share the concern expressed by my hon. Friend the Member for South Dorset (Mr. Bruce) that the scheme was not laid for consideration long enough. However, if there had been further consultation with the gun trade initially, it might not have been necessary to withdraw the scheme and re-lay it. That is not a serious criticism of the Government because, as I said, I appreciate the complexity.

The Minister of State will be aware, however, that there is sensitivity among shooters on the issue. When a scheme is laid before Parliament one week and withdrawn the next, there is inevitably suspicion, which I shared until I got the hon. Gentleman's assurances that there was nothing sinister in the withdrawal. I merely flag that up as one of those little points. In dealing with a subject of this nature, it is important to try to get it right first time round--consult all concerned, so that they are not unduly suspicious if a scheme has to be withdrawn suddenly.

The Opposition believe that any compensation scheme must be fair and effectively administered. I am sure that, in drafting the scheme, the Government shared those objectives. Certain questions are left unanswered, however, and I am not certain that the Minister's explanation has fully covered them. I, therefore, seek clarification on a few points.

We introduced the Firearms (Amendment) Act 1997 to ensure greater protection for the public. As part of that Act, all higher-calibre handguns will be taken out of circulation and destroyed. We seek assurances from the Government that they will ensure that those guns are swiftly destroyed once deposited with the police. Have the Government given serious thought to the time scale between handguns being handed in to police stations and their being destroyed? We do not want handguns lying around in storage for long periods.

The security implications of protecting such armouries from theft would be very great, as, indeed, would be the burden placed on the police, who would no doubt be responsible for keeping them safe. The Minister did not fully answer the question that was put to him on the danger of those weapons lying around too long in police armouries or elsewhere.

I do not seek any information that would identify any locations where the weapons would be kept and could make it easier for terrorists, criminals or anyone else to get their hands on them, but I think that, despite the Minister's assurances that we should not worry because the Government have had intense discussions with the police and are aware that the matter must be dealt with expeditiously and securely, we need more information on how the weapons will be kept, when they will be destroyed and in what circumstances, and whether there

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will be armouries dotted around the country--with the weapons being passed on to the Army, for example--or one or two grand central armouries.

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