Export Control Bill

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Dr. Cable: I beg to move amendment No. 11, in page 2, line 33, leave out subsection (2).

The amendment takes us to the heart of the argument about democratic control and accountability of the export control procedure. This is a procedurally complicated area, and I suspect that even those of us who are involved in the debate are struggling to understand its complexities. It may help if I set out my understanding of the hierarchy of permissions and authorisations that will operate once the legislation has come into force.

There are essentially four types of approval mechanism. First, there is the most demanding type—the prior approval involved in the affirmative resolution procedure, which will apply to changes in the purposes for making an arms control order specified in the schedule. That process clearly requires the full involvement of Parliament. Secondly, there is the deferred affirmative procedure, which will apply to temporary orders. That, essentially, is what we are concerned about with regard to the clause. Thirdly, there is the negative resolution procedure, which applies to changes that the Government consider to be more minor, but may well involve important considerations. Lastly, there is the informing of Parliament of very small technical changes.

We acknowledge that some distinction must be made between different export controls. A one-size-fits-all procedure is not appropriate. We recognise that there is a role for prior approval—for which we must argue strongly in many cases—and for a routine procedure, which is set out in clause 8 and which would be the least demanding. We suggest that the two intermediate stages be eliminated.

On later clauses, we shall debate upgrading the negative procedure so that Parliament has proper prior scrutiny. I do not want to trespass on that subject, but I shall focus on the second stage in the hierarchy of procedures—the temporary orders. There are two problems with the temporary order procedure in the Bill, and the Quadripartite Committee dealt explicitly and somewhat critically with one of them. Two sentences from the Committee's report, ``Draft Export Control and Non-Proliferation Bill'' are relevant and capture the essence. Paragraph 45 states:

    ``The draft Bill makes provision at Clause 3(2)''—

with which we are dealing—

    ``for Orders which are not subject to the purposes set out in the Schedule. They are to be subject to modified affirmative procedure''.

The report then refers to the House of Lords Committee that considered the regulation procedures and

    ``expressed its concern over Clause 3(2), finding it not `right in principle and therefore appropriate to delegate a power to impose controls for purposes which are not set out in this Bill . . . The Committee does not at present consider that a restriction on the freedom to trade should be granted in such wide terms'.''

The Quadripartite Committee clearly and explicitly endorsed the criticism that there were not sufficiently good grounds for providing temporary orders that operated according to different rules.

The second set of criticisms relate to the fact that it is possible to envisage perfectly plausible circumstances in which there may be no parliamentary scrutiny whatever under the clause. If the order applied for fewer than 40 days, there would be no need for parliamentary scrutiny. Substantial and substantive changes in the export control procedure could simply be pushed through with no reference to Parliament. That relates partly to the time factor, and the Quadripartite Committee again focused on the problem, saying that

    ``the 40 day period of grace allowed before such an Order lapses unless parliamentary approval is given . . . seems to us too generous''.

In other words, the provision gives Ministers too much power to put through orders that have far-reaching implications without parliamentary scrutiny. The Committee suggested substantially reducing the period of 40 days.

The purpose of the amendment is to take out that second stage in the parliamentary scrutiny process to eliminate any ambiguity. The amendment is entirely in the spirit of the comments made by the Quadripartite Committee, to which members of all parties signed up. It is a building block that we can use to build stronger parliamentary scrutiny into the Bill.

Nigel Griffiths: The amendment, which would delete subsection (2), would prevent the Government from imposing temporary export controls by order for purposes that fell outwith those contained in the schedule.

The purpose of subsection (2) is to allow the Government to respond to emergency situations by imposing controls that, exceptionally, do not or might not fall clearly within the proposals set out in the schedule, where the need for such controls is likely to be short term. An amendment to the schedule of purposes is therefore not warranted.

Although we do not anticipate needing to use the power, there is a strong case for retaining it. By definition, the controls involved will be of a kind and needed for a reason that we cannot foresee, so it is not easy to give an example. However, we continue to believe that it is only prudent to take the power, although we also consider it right that it should be subject to Parliament's express approval. As a result, we have imposed a requirement that any orders made for reasons that fall wholly or partly outwith the purposes must be approved by Parliament by the affirmative resolution procedure. That means that any orders made under the subsection would cease to have effect if not approved by both Houses of Parliament before the end of a 30-day period. Moreover, such an order could not remain in force longer than 12 months unless approved again by Parliament under the affirmative resolution procedure.

12.15 pm

I remind hon. Members that the power would have to be exercised in a manner consistent with European Community law. The likely effect would be to confirm its use in national emergencies. The published draft of the Bill proposed that the purposes for which export controls could be exercised could be amended by an order subject to delayed affirmative action. The Select Committee on Delegated Powers and Deregulation in another place recommended that such a power should be exercisable under the draft affirmative procedure rather than the delayed affirmative procedure. In view of that recommendation and the fact that the procedure set out in clause 3(2) would be available in an emergency to permit control of exports outside the purposes listed in the schedule, the Bill has been altered. Clause 12(2) now provides for purposes to be amended under the draft affirmative procedure. In addition, orders made under clause 6(1), to require information, are now subject to the affirmative procedure.

I hope that I have demonstrated that we have listened to representations about the draft, and that we have strengthened the Bill after taking the advice in those representations. The use of affirmative resolution procedures would give Parliament an appropriate degree of scrutiny of orders made under the subsection, and I hope that the hon. Member for Twickenham will be willing to withdraw the amendment.

Mr. Page: Before the hon. Member for Twickenham responds, will the Minister explain how the operational details for the handling of export licences would fit into the framework? Concern has been expressed about the delay in dealing with export licence applications. The target times have been exceeded. How will the two aspects of the matter fit together? Following an application for a licence, how far would the resolutions that the Minister has outlined cover the process, and how much of it would be a matter of the Department's ordinary handling of the timetable?

Nigel Griffiths: There would not necessarily have to be a licence application. If it was decided that the UK would unilaterally impose an embargo in response to an emergency somewhere in the world, details of that would be circulated. Any subsequent application for a licence would be measured against that. Clause 3(2) is intended to allow for the application of the Bill to unanticipated cases, enabling the Secretary of State to take appropriate action in possibly highly unusual circumstances. All such actions would be reported to Parliament and subject to Parliament's express approval under the resolution procedure.

Dr. Cable: I understand that unforeseen circumstances arise, but the subsection would create a potentially very large loophole enabling parliamentary scrutiny to be relaxed. The Minister says that there may be national emergencies. Most hon. Members are patriotic, and if there is such an emergency they will respond quickly. There is no reason why the prior scrutiny requirement of Parliament should create an obstacle to that. Equally, if the purposes defined in the schedule prove inappropriate, procedure under clause 11 allows them to be changed. The legislation provides some flexibility so, with the good will of hon. Members, there is no reason why affirmative action should represent an obstruction.

I do not propose to press the amendment, but I ask the Minister to consider the time period as he moves some way towards those who are unhappy about the clause. The Quadripartite Committee asked about it and unforeseen circumstances. The Committee was generous about accepting the Minister's good will, but said that the 40 days should be cut down substantially. It said that so that parliamentary prerogative would be preserved, and to ensure that the period could not be used to abuse Parliament and rush through large numbers of exemptions from parliamentary scrutiny. I ask the Minister to have a fresh think about the time period, even if he does not have one on the principle.

Nigel Griffiths: Our response to the Quadripartite Committee's recommendations is clear. We considered them closely and noted them, but are not persuaded that there should be a shorter period in which orders remain in force before they are subject to parliamentary approval. Should that become necessary in circumstances that I have said are difficult to outline, we will know by example whether we have been vindicated. I believe that we will be vindicated on that time scale.

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