House of Commons - Explanatory Note
Serious Organised Crime And Police Bill - continued          House of Commons

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THE BILL

COMMENTARY ON CLAUSES

Part 1: The Serious Organised Crime Agency

Chapter 1: SOCA: Establishment and activities

Clause 1: Establishment of Serious Organised Crime Agency

66.     This clause provides for the creation of the Serious Organised Crime Agency and for the abolition of the National Criminal Intelligence Service, the National Crime Squad and their respective Service Authorities (all established by Parts 1 and 2 of the Police Act 1997). SOCA will be an executive Non-Departmental Public Body. Subsection (2) gives effect to Schedule 1, which sets out details of the constitution and staffing of SOCA.

Schedule 1: The Serious Organised Crime Agency

Paragraph 1: Membership

67.     This paragraph determines the membership of the Board of SOCA. It is to consist of a chairman and ordinary members to be appointed by the Secretary of State, the Director General (also appointed by the Secretary of State (paragraph 9(1))), and other ex-officio members to be appointed by the Director General after consulting the chairman. The Secretary of State may determine the number of ordinary members and must ensure that the ordinary members together with the chairman are always in the majority. Thus, for example, if there were five ex-officio members (including the Director General), there must be at least five ordinary members, who with the chairman, would form a majority on the Board. The minimum membership is five, namely the chairman and at least four ordinary and ex-officio members; this ties in with the minimum attendance at any meeting setting the quorum for meetings (paragraph 17(2)).

Paragraphs 2-5: Tenure of office: chairman and ordinary members

68.     The maximum term of appointment for the chairman or ordinary member is to be five years. A person may be re-appointed to either position as long as they have not previously been removed from office by the Secretary of State for any of the reasons in paragraph 4.

Paragraph 6: Remuneration, pensions etc. of chairman and ordinary members

69.     The Secretary of State may determine the remuneration, allowances, pension and, where necessary, compensation payable by SOCA to the chairman and ordinary members.

Paragraph 9: The Director General

70.     The appointment of Director General is to be made by the Secretary of State, following consultation with the chairman and Scottish Ministers, for a maximum term of five years. In making the appointment, the Home Secretary would in practice also consult the Secretary of State for Northern Ireland. The terms and conditions of the appointment, the remuneration and allowances shall also be decided by the Secretary of State.

Paragraph 10: Termination or suspension of appointment of Director General

71.     This paragraph sets out the procedure for terminating or suspending the appointment of the Director General. The Secretary of State may require the Director General to retire or resign in the interests of efficiency or effectiveness, or by reason of any misconduct (paragraph 10(1)).

72.     Before exercising the power to call upon the Director General to retire or resign the Secretary of State must give the Director General his reasons for removal in writing (and send a copy to the chairman), afford him the opportunity to make representations in person at a hearing, and consider representations made by or on behalf of the Director General (paragraph 10(3) to (5)). The Secretary of State must also consult the chairman of SOCA and Scottish Ministers (paragraph 10(6)); in practice the Home Secretary would also consult the Secretary of State for Northern Ireland. Under paragraph 10(8) the Home Secretary may suspend the Director General from duty if he considers it necessary to do so to maintain public confidence in SOCA. Again there is a requirement for prior consultation with the chairman of SOCA and Scottish Ministers. The Director General's terms and conditions of appointment may provide for other grounds for suspension or termination of his appointment (paragraph 10(9)). Such terms might, for example, provide for the termination of the appointment if the Director General was declared bankrupt.

Paragraphs 12-13: Remuneration and pensions of staff

73.     These paragraphs enable SOCA to determine the remuneration and allowances of its employees (excluding the Director General whose remuneration is determined by the Secretary of State in accordance with paragraph 9(4)).

Paragraph 21: General powers

74.     This paragraph enables SOCA to enter into contracts, acquire property, borrow money and receive gifts or loans, where it decides to do so in connection with the discharge of its functions. SOCA requires the consent of the Secretary of State when acquiring or disposing of property and borrowing money. This consent does not need to be given on a case by case basis. Instead, the Secretary of State may choose to give blanket consent, based on conditions or a class of cases as defined by him.

Clause 2: Functions of SOCA as to serious organised crime

75.     This clause sets out the core functions of SOCA in relation to serious organised crime. Additional functions are set out in clause 3. These functions will be to prevent and detect serious organised crime and to contribute to the reduction of such crime and to the mitigation of its consequences. In effect, the purpose of SOCA will be to reduce the harm caused by serious organised crime. This purpose reflects the approach for the Agency which was set out in the White Paper One Step Ahead: A 21st Century Strategy to Defeat Organised Crime. The function of mitigating the consequences of organised crime acknowledges that the prosecution of organised criminals is only one of the strategies that may be employed to tackle organised criminality.

76.     Subsections (3) and (4) circumscribe the extent to which SOCA may involve itself in serious fraud cases. Tackling revenue fraud is primarily the responsibility of the Commissioners for Inland Revenue and for Customs and Excise (and, in future, the Commissioners for Revenue and Customs). Accordingly, SOCA may only investigate organised revenue fraud with the agreement of the Commissioners. Similarly, under the terms of section 1 of the Criminal Justice Act 1987, the SFO has primacy in the investigation of serious or complex fraud. Again, SOCA may only pursue serious non-revenue fraud cases where the SFO declines to act or with the agreement of the Director of the SFO.

77.     SOCA may undertake activities directed at reducing the harm caused by revenue and serious or complex fraud that do not involve formal investigations - for example, the dissemination of information to financial institutions on combating types of fraud. Where any functions are undertaken under clause 2(1)(b) in connection with revenue fraud SOCA must first consult the Commissioners.

Clause 3: Functions of SOCA as to information relating to crime

78.     This clause sets out an additional function of SOCA as to information relating to crime. Under subsection (1) SOCA is charged with gathering, storing, analysing and disseminating information relevant to the prevention, detection, investigation or prosecution of offences or to the reduction of crime by other means or the mitigation of its consequences. The function is in relation to crime at large, and not just to serious organised crime, as SOCA will provide information to police forces, special police forces and other law enforcement agencies in the discharge of their functions. SOCA may also disseminate information to other persons in pursuit of the reduction, prevention and detection of crime.

79.     Subsection (3) defines a police force for the purpose of this clause, subsection (4) defines a law enforcement agency and subsection (5) defines a special police force.

Clause 4: Exercise of functions: general considerations

80.     This clause requires SOCA in exercising its functions to have regard to its current annual plan (issued under clause 6), the strategic priorities set by the Secretary of State (determined under clause 9), any performance targets (including those set in accordance with clause 10) and codes of practice (issued under clause 11).

Clause 5: SOCA's general powers

81.     This clause confers general powers on SOCA (subsection (3)). Subsection (2) provides that SOCA may: institute criminal proceedings; at the request of a chief officer of a police force or other law enforcement agency, act in support of that force or agency in the pursuit of their functions; and co-operate with other bodies, including overseas agencies, in pursuit of SOCA's functions. SOCA may carry out activities in relation to other, less serious, crime if it is in pursuit of its overall functions in clause 2 and 3 in relation to serious organised crime (subsection (3)). SOCA may, for example, seek to investigate and prosecute a known organised criminal for a lesser offence if that was the most effective means of securing a conviction and custodial sentence. The power to institute criminal proceedings is limited to England, Wales and Northern Ireland; in Scotland responsibility for instituting such proceedings rests with the Lord Advocate and Procurator Fiscal (see clause 23).

82.     Subsection (5) confers a general power to assist governments or other bodies exercising functions of a public nature in countries outside the United Kingdom.

Clause 6: Annual plans

83.     This clause requires SOCA to produce an 'annual plan' before the beginning of each financial year, to be published as SOCA sees fit. The annual plan must include:

  • the priorities SOCA has set itself for the year (subsection (3)(a))

  • the strategic priorities set by the Secretary of State (subsection (3)(b))

  • a statement of how SOCA intends to meet these priorities over the coming financial year (subsection (5))

  • any performance targets set by SOCA (subsection (3)(c))

  • details of how SOCA intends to carry out its functions in Scotland and in Northern Ireland (subsection (2))

84.     Any priorities set by SOCA in accordance with subsection (3)(a) must be consistent with the strategic priorities set by the Secretary of State under clause 9, but may encompass other matters (subsection (4)). The element of the annual plan that relates to Scotland must be agreed with Scottish Ministers (subsection (9)(a)).

85.     Before issuing the plan SOCA must consult such other persons as it thinks fit (subsection (9)(b)). Subsection (7) places a duty on SOCA to send a copy of the plan to specified persons. It is open to SOCA also to send copies to such other persons as it thinks fit.

Clause 7: Annual reports

86.     This clause requires SOCA to publish an annual report at the end of each financial year. The report must include an assessment of the extent to which SOCA has carried out the annual plan for that year.

87.     Subsection (4) places a duty on SOCA to ensure that a copy of the report is sent to specified persons. It is open to SOCA also to send copies to such other persons as it thinks fit.

Clause 8: General duty of Secretary of State and Scottish Ministers

88.     This clause places a duty on the Secretary of State and Scottish Ministers to exercise their powers in relation to SOCA in a manner best calculated to promote the efficiency and effectiveness of the Agency.

Clause 9: Strategic priorities

89.     This clause gives the Secretary of State power to set strategic priorities for SOCA. Such priorities may, for example, cover the reduction in harm caused by drug trafficking and people smuggling. These 'strategic priorities' are to be set in consultation with SOCA and Scottish Ministers (the Home Secretary would also consult the Secretary of State for Northern Ireland) and need not be limited in scope to the financial year in which they are determined. Under clause 6 any annual priorities set by SOCA must be consistent with the ministerial strategic priorities.

Clause 10: Performance targets

90.     This clause gives the Secretary of State a power to direct SOCA to set performance targets in respect of each of the strategic priorities determined by the Secretary of State under clause 9. Subsection (2) provides that the Secretary of State may set conditions for these targets. Where the Secretary of State exercises this power, he must consult Scottish Ministers before giving any directions; as a matter of practice the Home Secretary would also consult the Secretary of State for Northern Ireland.

Clause 11: Codes of practice

91.     This clause allows the Secretary of State to issue, and as necessary revise, codes of practice relating to the discharge by SOCA of any of their functions. Before issuing a code, the Secretary of State must consult SOCA, Scottish Ministers and other persons he thinks fit (subsection (3)). The Home Secretary would, in particular, also wish to consult the Secretary of State for Northern Ireland. Subsections (4) to (6) require the Secretary of State, subject to a sensitivity test, to lay before Parliament all codes of practice issued under this clause.

Clause 12: Reports to Secretary of State

92.     This clause allows the Secretary of State to require SOCA to give him a report on any of their activities. Where the activities concerned are carried out wholly or partly in Scotland, the Secretary of State is first required to consult the Scottish Ministers (subsection (3)). The Secretary of State may determine whether these reports are to be published (subsection (4)). Where a report is published, it may be published with any sensitive material excised (subsection (5)).

Clause 13: Power to direct submission of action plan

93.     This clause provides a mechanism for the Secretary of State to intervene to require remedial measures to be taken to address poor performance by SOCA. Subsection (1) to (3) empower the Secretary of State to require SOCA to submit an action plan setting out the remedial measures that the Agency proposes to take to address those aspects of the Agency's performance which has been judged by Her Majesty's Inspectorate of Constabulary (HMIC) to be inefficient or ineffective (or will become so unless such measures are taken). SOCA will have between four and twelve weeks to submit an action plan (subsection (2)(b)). A direction to SOCA to produce an action plan may require the inclusion of performance targets and timescales for implementation. It may also require periodic progress reports to be sent to the Secretary of State (subsection (4)). Subsection (5) specifically limits the Secretary of State's power of direction by providing that he cannot require action in relation to particular cases or individuals.

Clause 14: Revision of inadequate action plan

94.     This clause provides that the Secretary of State may comment on the action plan submitted to him under clause 13 where he considers that the remedial measures contained therein are inadequate (subsection (1)). SOCA must consider the Secretary of State's comments but it is a matter for them whether to amend the action plan in the light of the Secretary of State's comments (subsection (4)).

Clause 15: Procedure for giving directions under section 13

     95.     This clause sets out procedural safeguards in relation to the exercise by the Secretary of State of his powers to give directions as to action plans as are contained in clause 13. The clause places a duty on the Secretary of State to put the evidence that the whole or part of SOCA is failing to the Agency and afford it the opportunity to make representations. He will be under a duty to have regard to such representations. The Secretary of State is further required to afford SOCA the opportunity to put in place its own remedial measures before they are directed to do so. The intention is that where such remedial measures fully address the area of concern there would be no need for the Secretary of State to issue a formal direction.

Clause 16: Reports relating to directions under section 13

96.     This clause requires the Secretary of State to prepare and issue a report on the use of his power under clause 13. Any such report must be laid before both Houses of Parliament and the Scottish Parliament.

Clause 17: Inspections

     97.     Clause 17 sets out the arrangements whereby SOCA will be subject to inspection by Her Majesty's Inspectors of Constabulary. It also allows the Secretary of State to initiate an inspection, and places a duty on the Secretary of State to make the report of an inspection public, subject to national security and other sensitivity considerations. Where an inspection covers SOCA's activities in Scotland then HMIC must conduct the inspection jointly with the Scottish inspectors.

Clause 18: Grants by Secretary of State

98.     This clause makes provision for the Secretary of State to make grants to SOCA for each financial year. The amount of and times at which, grants may be paid may be determined by the Secretary of State and can be varied by him. The Secretary of State can also attach conditions to the payment of any grant, such as specifying how the payment or any part of it can be used and requiring repayment in specified circumstances.

Clause 19: Determinations relating to grants under section 18

99.     This clause expands upon the Secretary of State's duty to make grants to SOCA under clause 18. The Secretary of State is required to issue annual determinations on SOCA grants, in the form of a report which sets out considerations underlying the determination. However, it is open to the Home Secretary to make a determination covering two or more years in order to afford SOCA greater financial stability (subsection (2)). A copy of the report must be sent to SOCA and laid before the House of Commons (subsection (6)). Determinations may be varied at any time, but in each case a further report is necessary. The Secretary of State can also require SOCA to provide him with information to assist him in reaching a determination, and he can require such information within a specified period (subsection (7)).

Clause 20: Charges by SOCA and other receipts

100.     The purpose of this clause is to authorise SOCA to charge for any goods or services it provides, for example the provision of training. Save where the Secretary of State otherwise directs, any income accrued by SOCA (other than grant income or borrowings or monies received from the Secretary of State in respect of international joint investigation teams) must be paid over to the Secretary of State, who in turn must pay it into the Consolidated Fund.

Clause 21: Accounts

101.     This clause imposes duties on SOCA governing the keeping of proper accounts and records in relation to those accounts, the preparation of a statement of those accounts for each financial year, and the sending of copies of that statement to the Secretary of State and the Auditor General. The Comptroller and Auditor General is required to examine and certify the SOCA statement of accounts and issue a report to be laid before Parliament.

Clause 22: Operational responsibility of Director General

102.     This clause seeks to enshrine the operational independence of the Director General. It will be for the Home Secretary to set the strategic priorities of SOCA and for the SOCA Board (of which the Director General will be a member) to set other priorities, but thereafter it will be for the Director General to determine which operations to mount and how such operations are to be conducted.

Clause 23: Activities in Scotland in relation to crime

103.     This clause preserves the role of the Lord Advocate in respect of the investigation and prosecution of crime in Scotland. SOCA may only carry out its activities in relation to an offence which it suspects has been committed or is being committed with the agreement of the Lord Advocate, and in doing so it must comply with all directions received from him or from the procurators fiscal.

Clauses 24 and 25: Mutual assistance between SOCA and law enforcement agencies

104.     Clauses 24 and 25 make provision for a police force or other law enforcement agency to call upon SOCA to provide assistance and vice versa. Such assistance will usually take the form of the loan of staff but may also take other forms, such as the loan of facilities or equipment. It is expected that the arrangements for the provision of such mutual assistance will be made voluntarily between the parties concerned and clause 24 provides for this. Clause 25 contains a reserve power for the Secretary of State to direct either the Director General of SOCA, or the chief officer of a police force or the head of a law enforcement agency to provide mutual assistance where there is a failure to agree voluntary arrangements. Any direction to a police force in Scotland or to the Scottish Drug Enforcement Agency (SDEA) may only be made with the consent of Scottish Ministers and any direction to the Commissioners of HMRC may only be made within the consent of the Treasury (Clause 25 (4)). Any direction to the Police Service of Northern Ireland would, as a matter of practice, be made by the Secretary of State for Northern Ireland.

105.     Where constables or other staff of a police force or law enforcement agency are made available to SOCA under these provisions they will be under the direction and control of the Director General. Similarly, where SOCA staff are made available to a police force or other law enforcement agency, they will be under the direction and control of the chief officer or head of the agency, as the case may be (clause 24(6) and (7)).

106.     Clause 24(8) and (9) make provision for SOCA, police forces and law enforcement agencies to pay for any assistance provided by another party. However, the parties involved in any arrangement for the provision of mutual assistance may decide that there should be no such cross charging.

Clause 26: Use by SOCA of police premises etc.

107.     This clause enables SOCA to use the premises, equipment, facilities or services of a police force in accordance with an agreement made between them or, in the absence of such an agreement, following a direction by the Secretary of State. It is not expected that SOCA will maintain its own custody facilities; accordingly this clause would, for example, allow for the use by the Agency of custody facilities provided by a police force. The Secretary of State may use this power to direct only after notifying the relevant body of his intentions and considering their subsequent representations. Subsection (6) makes provision for SOCA to pay to a relevant police authority for the use of any premises etc., but SOCA and the authority in question may decide that any such premises etc. may be provided for use by the Agency free of charge. This clause only applies to police forces in England, Wales and Northern Ireland. In carrying out its functions in Scotland, SOCA is expected to work closely with the SDEA and any use of police premises etc. will follow the administrative arrangements the SDEA has made with the 8 Scottish forces.

Clause 27: Regulations as to equipment

108.     This clause allows the Secretary of State to make regulations governing the equipment used by SOCA. Subsection (1) enables regulations to be made prescribing the design and performance of equipment provided or used for the purposes of SOCA.

109.     Subsection (2) enables regulations to be made requiring SOCA to use specified equipment, or equipment which is of a description specified, or type approved by the Secretary of State. The type approval of equipment may be made subject to conditions as to its use. The use of specified equipment or equipment of a specified description may also be prohibited under the regulation-making power. Before making any regulations under clause 27, the Secretary of State must consult SOCA and may also consult anyone else he chooses (subsection (3)).

110.     Regulations made under this clause are subject to the negative resolution procedure.

Clause 28: Liability of SOCA for acts of seconded staff

111.     This clause establishes SOCA's liability in respect of any unlawful conduct by persons seconded to the Agency. The Bill makes no provision in respect of employees of SOCA because the Agency as the employer will be vicariously liable for any unlawful acts committed by its employees in the course of their employment. Subsection (1) provides that SOCA will be liable for unlawful conduct committed by seconded persons in the carrying out (or purported carrying out) of their functions as members of SOCA staff.

112.     Subsection (2) provides that SOCA will be a joint tortfeasor where such unlawful conduct by a seconded person is a tort.

113.     Subsection (3) defines seconded person for the purposes of clause 28.

Clause 29: Payment by SOCA of amounts in connection with unlawful conduct of employees etc.

114.     This clause confers on SOCA a power to make discretionary payments in respect of damages and costs arising out of unlawful conduct by a member of the Agency's staff (that is both direct employees and secondees).

 
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Prepared: 24 November 2004