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Dr. John Pugh (Southport) (LD): Given the Home Secretary's ongoing security concerns and the record on suspicious detainees absconding from custody at John Lennon airport, will the Home Secretary consider improving Customs and Excise as well as legislative change?

Mr. Clarke: The proposals in the Serious Organised Crime and Police Bill have been specifically designed to ensure better co-operation between the various interested agencies, including Customs and Excise. The hon. Gentleman's point is well made, in the sense that we will invest to ensure that enough staff are available to address the threats and the proposals before the House will help immensely in achieving his ambition.

Ms Diane Abbott (Hackney, North and Stoke Newington) (Lab): Does the Home Secretary accept that many people outside this House welcome his acceptance of the Law Lords' ruling? For some time, many people have said that the legislation is so contrary to any notion of the rule of law that it represents a victory for the terrorist. Will he also accept that, in practice, in the medium term, most of the British nationals who are subject to control orders will be of the Muslim faith? To intern individuals in their own homes in the middle of communities in our great cities will be, if anything, more incendiary than putting them in prison. Many of us welcome the Home Secretary's proposal to hold a full and careful debate to discuss those ideas.

Mr. Clarke: I appreciate the first part of my hon. Friend's remarks. Her second point follows on from the point raised by my hon. Friend the Member for Walsall, North (David Winnick). It is important that the debate takes in all communities in this country, including the Muslim community. I reassert that members of the
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Muslim community have nothing to fear from the measures, unless they are explicitly involved in promoting terrorist activity. That distinction is the core point. If people are promoting terrorism and seeking to engage in terrorism, it is my responsibility to address that situation, whatever their religious faith or race. I cannot say, "You are a terrorist, but because you happen to be of x or y faith, it is okay." I cannot adopt that position, and I am sure that my hon. Friend would not. However, I agree with her fundamental point that plenty of room exists for misunderstandings around such questions and it is part of my obligation to ensure that as few misunderstandings as possible occur.

Mr. Henry Bellingham (North-West Norfolk) (Con): I welcome the Home Secretary's statement and feel that he deserves significant credit for moving so quickly. In the third paragraph of his statement, he discussed our international commitments on suspected international terrorists who are being kept in this country at substantial expense to taxpayers. Deportation with assurances will partly address that problem, but should we not revisit some of those international commitments? Is there not an opportunity for the UN to launch an initiative, too?

Mr. Clarke: I am more glad than I can say that the hon. Gentleman has raised the point that we need an international approach to the matter that involves the UN and other agencies, which is why I referred to the UN resolution in my statement. I highlighted the matter because working with other countries is the right way to go. On expenditure, we must spend whatever it takes to maintain our security, and I am determined that we will do just that.

Vera Baird (Redcar) (Lab): I compliment my right hon. Friend on the thought that he has put into trying to produce a reasonable solution to a very nearly intractable problem. I welcome his stated preference for trying suspected terrorists. Will he guarantee that that possibility will be pursued vigorously? In his view, will it be possible to put British suspects or any of the Belmarsh detainees on trial, and would changes in criminal procedure help with that? While the Belmarsh men were detained, how were British terrorist suspects, who could not be locked up under that law, being contained? I ask that not in a barbed way but in seeking a way forward.

Mr. Clarke: I appreciate the remarks of my hon. and learned Friend, whose experience in these matters is substantial. I can give her the guarantee that she seeks that I will pursue as energetically as I can a process of ensuring that trial procedures and so on are addressed in a way that means that prosecution in court leading to conviction is the best way to deal with these questions. I will consider any changes in procedure to achieve that.

As for the UK citizens currently involved, the security services have pursued a range of different measures under warrant from me, as Home Secretary, in accordance with the court. However, there have been constraints on the situation, which is why I propose such legislation.
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Mr. Michael Meacher (Oldham, West and Royton) (Lab): While I very much welcome my right hon. Friend's compromise, will he recognise that that is exactly what it is? What is really wrong with the present law is that the standard of proof required, namely reasonable belief or suspicion, is lower even than in civil proceedings; that the Special Immigration Appeals Commission and perhaps his own independent judicial inquiry will still not enable detainees to challenge the evidence against them because they cannot see enough of it; and that so-called "evidence" extracted under torture of a third party is still admissible. Will he address those fundamental points, if not today, in his review of the legislation? In the meantime, will he ensure that his new civil orders, which we welcome, impose strict surveillance conditions, including banning access to the internet and mobile phones, but do not include house arrest, which would breach the human rights convention?

Mr. Clarke: I do not accept my right hon. Friend's contention that this is in any sense a compromise. It is not—it is an effort to find a way through to deal with the issues. On his specific questions, I dealt with them all in previous answers and I have nothing to add.

Mr. Harry Barnes (North-East Derbyshire) (Lab): Is my right hon. Friend aware that I have never been soft on terrorism, having taken a great interest in the affairs of Northern Ireland and having been in Dar-es-Salaam on the day that al-Qaeda blew up the American embassy? However, certain actions may be justified if there is held to be a threat to the life of a nation. Perhaps what is going on in Iraq in relation to terrorism is a threat to the life of that nation. What similar threat exists in this country as distinct from serious threats like those in the past from the Provisional IRA? Should not such problems be dealt with by the courts rather than by special action through the Executive?

Mr. Clarke: Let me make it clear that I absolutely accept that my hon. Friend is not in any sense soft on terrorism. That is not the case, as his personal record clearly shows. Nor, by the way, do I make that charge against others who might oppose our proposals. These are genuine and difficult problems that need to be addressed in a way that reflects that fact.

As for the courts taking responsibility rather than the Executive—that is, myself as Home Secretary—I go back to what I said earlier. I believe that this is a proper Executive responsibility that should be borne by the Executive—in this case, by the Home Secretary—and not by the courts. I accept that it is right for the courts to have the ability to review the decision that is taken: that is why we are putting this process in place. As I said very clearly in my statement, I have explicitly considered the evidence that has been put to me about the very real threats that we have to deal with, and my conclusion is that we are in such a state. That is why I believe that we have to act in the way that I suggest.

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Point of Order

1.34 pm

Mrs. Caroline Spelman (Meriden) (Con): On a point of order, Mr. Speaker. At Prime Minister's questions, the Prime Minister stated that I said this morning that we are opposed to the development of the Thames gateway. I have said no such thing this morning or ever. In fact, I have publicly recognised the benefit of building on brownfield land. I hope, Mr. Speaker, that the Prime Minister merely inadvertently misled the House—or perhaps he was guilty of a little shameless opportunism.

Mr. Speaker: These things are not a matter for me.

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Regulation of Financial Services (Land Transactions)

1.35 pm

Mr. David Stewart (Inverness, East, Nairn and Lochaber) (Lab): I beg to move,

The Bill is designed to protect the elderly, the vulnerable and the unguarded from exploitation by the shadowy figures who lurk in the shallow end of the financial services gene pool. It would bring home reversion plans, which are a type of equity release scheme, under the full regulation and protection of the Financial Services Authority. In addition, it would provide a safety net of access to the financial ombudsman scheme and compensation. The Bill would also protect constituents who are, for example, purchasing Islamic products under the Ijara system or have a part- rental, part-purchase home tenure scheme.

What are equity release schemes and how do home reversion plans fit into the bigger picture? Equity release schemes are basically financial products that allow homeowners to realise the value of their property. There are two main vehicles. The first is the lifetime mortgage, whereby homeowners take out a loan secured on their property. That is already covered by the FSA and is well protected.

I am concerned about the second type—home reversions. They are subject to little regulation, control or monitoring. Homeowners sell part or all of their home in return for a lump sum, which is usually in the range of 30 to 65 per cent. of the property value. Such homeowners are usually over 60. They have a right to remain in the house under a lease until they die, with the proviso that they maintain the property, and they have to pay rent to the reversion provider. When the elderly person dies, the provider can sell the property. The lump sum received will depend on a series of factors, including the value of the property, which will not necessarily be independently surveyed, and the age, medical condition and life expectancy of the owners.

My hon. Friend the Member for Brent, North (Mr. Gardiner) said in a similar debate:

The financing of home reversions at the small end of the market is largely about private individuals; there is no central register of reversion transactions. Let me give a
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few examples of what could happen. A GP could arrange a home reversion for an elderly, confused patient; a private individual could carry out a transaction for a recently widowed neighbour; or a publican could help out an elderly regular at their bar. There are no standards or benchmarking, and there is no protection for the consumer. Those are the perfect ingredients for the unscrupulous to manipulate, misuse and milk the unwary.

I am not saying that all equity release schemes are a bad thing per se or that I have concerns about the whole industry. For example, the 17 members of the Safe Home Income Plans group provide high standards of consumer protection, with very few complaints and a market share of around 90 per cent. The overall market is worth £1.16 billion—a tremendous size. The Treasury estimates that 5 million homeowners over 60 are eligible for equity release plans, with a potential £700 million locked up in their homes.

The problem relates historically to pension mis-selling, specifically the Equitable Life fiasco. As long as we have an unregulated market, a series of elephant traps will be waiting to snare the unsuspecting and vulnerable pensioner at risk from the modern-day snake oil salesman selling dodgy deals administered by back-street, here-today-gone-tomorrow Arthur Daleys. Home reversions have no licensing requirements, no compensation arrangements, and no comeback from mis-selling. They are about as regulated as the average episode of "Celebrity Big Brother".

In conclusion, the Bill would protect the old and the vulnerable who are considering home reversion equity release products. It would bring the sheriff—the Financial Services Authority—back to the wild west town. It would bring independence through the financial ombudsman scheme and access to compensation. I believe that the Bill has the support of hon. Members of all parties and I strongly commend it to the House.

Question put and agreed to.

Bill ordered to be brought in by Mr. David Stewart, Angus Robertson, Sandra Osborne, Mr. Andrew Dismore, Ms Julia Drown, Sir Archy Kirkwood, Miss Anne Begg, Mr. Andrew Mitchell, Mr. Bill Tynan, Glenda Jackson, John Robertson and Mr. Alistair Carmichael.

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