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Miss Ann Widdecombe (Maidstone and The Weald): Then the idea was dropped.

Mr. Straw: As the right hon. Member for Maidstone and The Weald (Miss Widdecombe) says, from a sedentary position, the idea was dropped. There is no harm in discussing an issue and then taking a different view, according to the balance of the argument. We were persuaded that key escrow could have disrupted e-commerce in this country, especially if other countries did not adopt the arrangement. We were proposing a quasi-voluntary regime, whereas France--as one might expect--was proposing a wholly dirigiste regime that would have made it compulsory in all circumstances to vest keys with a safe third party. However, even France went off the boil with regard to that proposal, and the French Government are reconsidering the matter.

Secondly, the Government took account of almost everything that the Select Committee said, and we have strengthened the safeguards in the offences relating to a failure to comply with the notice for key disclosure under clause 48. Those measures are set out in clauses 49 and 50.

Mr. Fabricant: I fully support the concept that, where they exist, keys should be capable of access, for instance

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in relation to the transfer of funds using credit cards. However, what about when a key is not in the public domain, so to speak? The Home Secretary will know that drug dealers use their own encryption tools when they communicate with each other. What does he have to say about e-mails that are encrypted and decrypted by drug dealers? The internet service providers will not be aware of what is happening, as the messages will be only a data stream to them.

Mr. Straw: A person who does not have possession of the key cannot be guilty of the offence. By definition, the keys are a secret confined to the people who have control of them. One half of the key--the part used by the person communicating data to a recipient--is public; by definition, the other half is private, and that is the part that interests law enforcement agencies.

Mr. Simon Hughes: Is not the remaining significant complaint about the proposals that they could penalise people who lose their encryption keys? The Bill places on such people the burden of proving either that they never had such a key in the first place, or that they are innocent. However, it offers a relatively light penalty for people who intentionally claim that they cannot find their method of decryption. Clearly, major criminals would rather accept a six-month punishment than a much more severe penalty. Would not that seem to them to be a price worth paying?

Mr. Straw: It is worth bearing in mind that the product of interception resulting from the use of such keys cannot be adduced in evidence. People will not be able to deny material of evidential value in court, as the Bill--like the Interception of Communications Act--is based on the premise that neither prosecution nor defence can adduce the product of intercept as evidence in court. If there is concern in the House about the balance of the penalties, which can be discussed in detail in Committee, I am happy to take representations about it. As I have said before, I have never put a Bill before the House that has not been improved as a result of the parliamentary process, and I hope that I never will, because that is the essence of what Parliament is here for.

We have had discussions about people who have lost their key. I find it slightly eccentric, although it is not impossible, that someone can lose a key that he needs to access a large amount of data. Such things happen, of course, and the person has a perfect defence if he has lost it and then forgotten it. I do not believe that a court would convict people in those circumstances if it believed them. If it did not, however, that would be a different matter. Whether the case went before a magistrates court or a Crown court, we have very high standards of justice in this country.

I should like to deal briefly with international comparisons and the role of the commissioners and the tribunal. Law enforcement worldwide is worried about the criminal use of encryption. I have discussed this on a number of occasions with colleague Ministers of Justice and the Interior, including the United States Attorney- General, Janet Reno. The United Kingdom and the United States are both putting in place a package of measures to tackle the problem.

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In European terms, we are ahead of the game in e-commerce and law enforcement legislation. Our goal is to make the United Kingdom the best and safest place in the world to do e-commerce. The industry, too, wants a secure environment in which to conduct business.

The scheme of the Bill is aimed at trying to keep up with the advance of technology as best we can. The gloomy prognosis, though, is that whatever is done, law enforcement will take a hit over encryption. That is partly my answer to my hon. Friend the Member for Crewe and Nantwich. Introducing the measures in part III is the least that we can do to minimise the effect of that hit. They form an important part of the package of measures that we are putting in place if we are to have any hope of dealing successfully with the threat from the criminal use of encryption.

Part IV is in many ways the most important part of the Bill. It sets out who is to scrutinise the use of the six powers and it establishes a tribunal, which will be accessible to all. The existing commissioners for interception, the security service, intelligence services and surveillance will continue with their present roles and will add to some of them the powers in the Bill. One role of the commissioners will be to reassure Parliament and the public that the powers are being used properly. In addition, a new tribunal is established to consider complaints.

The hon. Member for Southwark, North and Bermondsey asked whether we could bring together all the separate regulation regimes. I did not think that that was appropriate, but I accept the argument that we should amalgamate the current plethora of tribunals and different avenues available for complaints. That is what we are doing in the Bill. We are abolishing the specific tribunals and establishing one all-embracing tribunal to replace those functions and any others that are relevant under the Bill. It will be a serious and powerful tribunal, and will be available as redress in respect of the use of a wide number of techniques by the investigating agencies.

The Bill sets out six conditions for the use of six law enforcement powers, used daily in the front line against some of the most serious threats to our society. We have previously regulated these powers on a piecemeal basis in response to judgments of the European Court of Human Rights. In this Bill, we are anticipating, on a comprehensive basis, the requirements of human rights legislation.

These are the principles. No doubt some of the more detailed provisions will lead to discussion here and in Committee. Meanwhile, I commend the Bill to the House.

4.14 pm

Miss Ann Widdecombe (Maidstone and The Weald): This is an important Bill, dealing with very complex matters. Given the enormous advances in technology and the possibility of its lawful and unlawful use, we fully acknowledge that the time has come to look again at updating the Interception of Communications Act 1985. We are therefore broadly supportive of the principles behind the Bill. We will not be opposing Second Reading, but that does not mean that there are not areas of fairly serious concern that we will wish to examine in considerable detail during the Bill's passage.

The last time I told the Home Secretary that I did not oppose a Bill's Second Reading he evinced some displeasure when I chose to oppose it at further stages of

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its proceedings. The fact that we support Second Reading--or that, at any rate, we do not oppose it--should not be taken as indicative that, if our concerns are not met, we shall continue to support the Bill throughout its future stages. Perhaps, as I have put that on the record, the right hon. Gentleman will not be greatly disappointed later. However, I hope that it will not be necessary to oppose the Bill; I hope that he will allow us to improve it so as to meet our concerns.

We accept that the explosion in methods of communication has given rise to a similar explosion in new methods of committing crime. If we failed to update the legislation that we introduced in 1985, we should damage the capability of this country's law enforcement, security and intelligence services to do their job.

However, the Bill is like the curate's egg--it is good in parts. We accept the need both to widen the power of interception to cover modern communications methods and to regulate surveillance and covert human intelligence. However, it is important that the Bill should be effective and still strike a proper balance between the needs of the crime fighter, the legitimate concern of business to avoid overweening regulation and the interest of the citizen in respecting fundamental human rights.

In some ways, the Bill does not provide crime fighters with all that they need. For example, clause 6 deals with those persons who may apply for interception warrants. It lists the head of every major security service and provides for the Secretary of State to designate "any . . . other person", but one notable omission is any provision for a senior official responsible for the detection of serious benefit fraud to apply for an interception warrant. Given that such fraud is by far the most substantial crime by value committed in the United Kingdom, it seems a bit odd that no senior official at the Department of Social Security can apply for a warrant--even in the most serious cases of benefit fraud; for example, those involving international gangs.

The powers in the Bill need strengthening to ensure that law enforcement agencies can obtain the evidence they need when dealing with serious sex offenders, drug traffickers and those involved in organised and terrorist offences by intercepting their communications and being able to break the codes that are used. I shall deal with that matter more fully when I come to the use of encrypted communications.

One of the great successes of the past few years has been the UK's growing information technology industry. The industry realises that it is important that law enforcement agencies should be able to carry out their work and that there should be provision to allow the interception of communications.


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