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8.42 pm

Mr. Robert Sheldon (Ashton-under-Lyne): I want to raise only two matters that arise from my long experience as Chairman of the Public Accounts Committee. That experience was long only because we were not successful in winning elections, which meant that the Opposition were able to elect the Chairman of the PAC. The two matters are fraud, and the ability to investigate areas of security and sensitivity.

There is a clear danger of fraud wherever there are security matters. Obviously, not many people can be involved in making decisions, even financial decisions. An extreme example of that occurred in the Metropolitan police. There was a fellow named Williams who had authority to place orders and to make payments. He was buying helicopters. The police did not want the criminals to know that they had that kind of surveillance, so Williams was given that power. He pocketed £5 million, went off to Scotland and bought most of a village and a hotel. He lived the life of a lord, and everyone assumed that a wealthy relative in Norway had provided the money. Every Sunday, he returned to London to cover his tracks.

That is the sort of case that can happen. It is very difficult to uncover such cases when there are matters of great secrecy, so there must be proper procedures, no matter how important security is. It is obvious that one person must never be made responsible both for placing orders and for receiving the money. Less obviously, there must be some investigation from outside. In that case, the investigation was made by the Comptroller and Auditor General, a marvellous institution that both does the audit and understands what is going on. In the Ministry of Defence, people from the National Audit Office are placed permanently to see what is going on. Some information filters through to the PAC, rather more filters through to its Chairman, and that is enormously important in giving an understanding of how the system works, and allowing rules to be laid down for procedure.

Another case was that of Al Yamamah, a £20 billion contract with Saudi Arabia, which was investigated by the Comptroller and Auditor General. How should we handle matters of such sensitivity? I informed the Committee of the matter, and it allowed me and the senior Conservative Member of the day, Michael Shaw--now Lord Shaw--to act as the full Committee. We pursued the matter together. If there had been any fraud or bribery in the Ministry of Defence, there would have been no question of secrecy. We would have let that be known in order to preserve the standing of the public service in general. In fact, there were matters concerning certain overseas individuals that we thought might be disadvantageous to our continuing with that important contract. We were able to assure ourselves that there was nothing more than that.

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The PAC has long been in favour of the ability to pursue public money wherever it may go. We do not have that power now and we did not have it then. I hope that the Committee may get that power at some future stage. It was discussed in 1983. Following public money wherever it goes happens in the United States of America and other countries.

My other point relates to the security services--MI5 and MI6 in short. We considered their two buildings, about which I shall not comment much except to say that I wish they were not quite as obtrusive as they are. There should be a certain amount of discretion not only in the services, but in their buildings. The one on the other side of the Thames is almost a disgrace, although that is a personal observation that has nothing to do with my former position as Chairman of the PAC, which ended last year.

I was concerned when we investigated the buildings. I read a secret report from the Comptroller and Auditor General, and I could see that there had been an overspend that had not been reported to the House. There were certain reasons for the overspend, and certain security implications into which I cannot go. However, the fact that there were overspends on both buildings should have been known. Until I ceased to be Chairman of the PAC, I was pursuing the matter to make sure that it was known. Unfortunately, the general election intervened, and my role on the Committee ended.

The crucial point is that there is a need for an investigating arm. There is the Comptroller and Auditor General, but the Intelligence and Security Committee needs someone to perform that role. It needs a highly respected and responsible person who has the approval of Government and Parliament and who is able to undertake investigations. Knowing our civil servants and public-spirited individuals, it would be astonishing if we could not come up with one or two names of people who could undertake such activity.

No one can deny that are several things going wrong in our security services. There have been too many reports of one sort or another. While the right hon. Member for Bridgwater (Mr. King) can undertake certain investigations--I pay tribute to his valuable work--that facility is limited. We need someone inside the bodies concerned to help us find out what is going on. The person with that responsibility must have the respect of people generally. I hope that the Committee will return to this matter in due course.

8.49 pm

Dr. Gavin Strang (Edinburgh, East and Musselburgh): It is clear from the debate that the House values the third annual report of the Intelligence and Security Committee. We are all grateful for its work. The right hon. Member for Bridgwater (Mr. King) brings much experience to it and he and its other members have served the House well.

There can be no argument about the importance of the work of the security services. The report recognises the huge value of their work when it is successful. As many, including the Foreign Secretary, have noted, in the main it is by definition not sensible or practical to focus attention on their successes. The report is valuable and contains much useful material on personnel management

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and on the compilation, retention and destruction of personal files. I, however, wish to discuss the security services' priorities.

There are clearly many valuable things that the security services can do, but resources are limited. The end of the cold war provides a great opportunity. Understandably, most of the focus of the media has been on the new work that they are doing on drugs and crime. I am sure that my right hon. Friend the Home Secretary values that work, where they are able to contribute.

I want to concentrate on other areas. The report's preface states:

We are proud of the contribution of our forces to peacekeeping--the Foreign Secretary mentioned Bosnia--but the work of the intelligence services in that respect is crucial and should be strongly supported.

My second point concerns the growth of international terrorism. There is huge growth in world aviation, and that will continue. That means more threats to aircraft, to mention but one aspect of international terrorism. If the intelligence services can contribute to reducing the number of hijackings, that would be an important service.

Thirdly, the preface mentions the important matter of the proliferation of nuclear weapons and other horrific modern weapons capable of huge destruction. If the intelligence services can increase our knowledge, especially of those countries that are developing such capabilities, it must be of immense potential value to our people.

Supporting our forces, international terrorism and the proliferation of weapons of mass destruction are by definition areas of great international interest. It follows that our intelligence agencies work with other agencies. That is how it should be. There are established democracies like ours with viable services, and by working together, they can achieve more. However, hard decisions must be taken on the priority and resources allocated to those activities.

On page 9, the report gives a figure for total expenditure of around £700 million. Paragraph 19 states:

All power to its elbow.

We know that, by definition, the intelligence services must be treated differently. No one wants transparency that compromises their work, but although decisions on the priority attached to different activities are for the agencies and the Government, Parliament and the broader community should also be able to participate. I hope that the committee will be able to provide more information and more of a breakdown of the resources allocated to different activities so that we can all contribute to the development of a set of priorities that commands the broad support of Parliament and the country.

We all hope that the significant sum of money still allocated to combating terrorism associated with Northern Ireland will come down; it is too early to say. If it does,

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we can have a constructive debate on how that money can be effectively used to help further the benefits that the security services have the potential to bring to our people.

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