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John Reid: For the record, the hon. Gentleman is not comparing like with like. The official cost of the Bloody Sunday inquiry, in which a large number of families are involved and which has lasted six or seven years, is £185 million. However, that is not the point. When I use the word, “costs”, I am referring to manpower, and the diversion of a huge amount of resources and efforts by men and women from the primary task of trying to protect us against another 7/7. That—and not financial cost—has always been the major consideration. In view of the challenges that we
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face—the massive threat to this country and the possibility of another tragedy—to divert a great deal of resources and manpower from our badly stretched security services for a prolonged period would result in a huge drain on our capability to fight terrorism, thus increasing the risk of another 7/7. In all conscience, I cannot do that, especially as I do not believe that there will be a commensurate reward in terms of questions answered, because there are some questions that we just cannot answer. I do not blame the hon. Gentleman for raising the issue, nor do I blame the families, because I understand that there are many questions to which they want answers, but against that we must weigh the protection of every family in Britain.

Mr. Clegg: I am grateful to the Home Secretary. I merely make two observations. First, it is difficult for me to assess how many resources would be diverted. Given that much of the information is out there somewhere, I find it hard to believe that it would be beyond the means of an inquiry to allocate a small team from the security and intelligence services to make that information available. Secondly—and this is a much more important, substantive point—the Home Secretary implied that there are not a sufficient number of questions that need to be answered, as enough ground has already been covered by other inquiries and reports. It is difficult to judge with scientific accuracy whether that assertion is true. The week before last, a report was published on the death of Zahid Mubarek, who was killed in custody. That inquiry took place after full reports by the Prison Service and by the Commission for Racial Equality, yet it still identified 176 failings and made 88 recommendations. It would rest heavily on the Home Secretary’s conscience, as it would on mine, if we failed to cover important ground and prevent future terrorist attacks because we omitted to hold an independent inquiry.

Ms Dari Taylor: You are making a clear case that you believe that an independent—

Mr. Deputy Speaker (Sir Michael Lord): Order.

Ms Taylor: I beg your pardon, Mr. Deputy Speaker. The hon. Gentleman has made a clear case for an independent inquiry on the grounds that certain questions have not been asked and intelligence has not been looked at. Would he like to explore those gaps tonight?

Mr. Clegg: I used the powerful example of the report on the death of Zahid Mubarek, which was published after two earlier investigations, to point out that its recommendations were made after it was claimed that all the lessons had been learned and all the information had been uncovered. I do not know the unknowable but, given the enormity of the 7 July attacks, I do not understand why the hon. Lady and others are reluctant to make a comparatively modest investment in an independent inquiry, which might uncover facts of which we have no knowledge at present.

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As for the ISC report, I welcome the wording on the regionalisation of the operation of the security and intelligence services, and the fact that the process of regionalisation was accelerated following the July bombings. I was struck by the passage in paragraph 40 which states:

I am surprised that the process of regionalisation does not appear to have happened earlier. It is arguable that excessive centralisation is as unwelcome in this matter as it is in so many other areas of Government policy.

It is consistent with the observation made in the Intelligence and Security Committee’s earlier report of the 7 July bombings that the regionalisation of the security and intelligence services helps improve policing at local level and helps the front-line intelligence-gathering function of our police forces. That takes on particular resonance in the week when the Government’s ill-judged attempt to force through police force mergers seems to have hit the buffers. I note that the Home Secretary’s predecessor today branded that development as weak and damaging, but I come to the Home Secretary’s defence, even in his absence. It is a welcome wake-up call that the move towards forced regional police mergers was the wrong way to go. The report helps to emphasise the need to localise both the police and the work of the intelligence services.

There was reference earlier to the Committee’s observations on the SCOPE IT system and the serious delays in rolling it out, from April 2005 to autumn 2006, yet the capital cost of that delay has been blanked out in the report. I find it difficult to understand why that cost should not be quantified in the report. I understand entirely that there is plenty of delicate and sensitive information that one does not want to appear in such reports, but I wonder whether there is a security risk in revealing the figure. I do not understand why the security services appear to have sought not to release the costs incurred by yet another delay in a public information technology project.

That is particularly apposite hot on the heels of the revelations in the Sunday newspapers, notwithstanding the Home Secretary’s confirmation this evening that he wants to press ahead with the development of the much more ambitious and complex ID card database, that there are pronounced reservations among senior officials about whether that is possible. One official was quoted in the Sunday papers as stating:

Another official remarked:

and yet another referred to the possibility that the scheme could be “canned completely”.

The fact that there is so much that we do not know about the feasibility of implementing the ID card database affirms the need for much more detail about why the SCOPE IT system has been delayed and the cost that that delay has incurred.

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The report contains an important section on the work of the Serious Organised Crime Agency, and states that the Committee was told about the difficulties that could arise from the fact that SOCA will be competing with other agencies for new recruits. The Committee is to continue to examine progress and assess the effectiveness of co-operation between SOCA, Her Majesty’s Revenue and Customs and other agencies.

I endorse the Committee’s observations that competition for resources between SOCA and other agencies needs to be kept under review. Vigilance is required to ensure the best possible operational relationship between SOCA and HMRC in pursuing serious drug investigations and criminal finance work, which are the two responsibilities that have been transferred from HMRC to SOCA.

However, there is a quasi-constitutional issue on which the report is silent, and which perhaps lies beyond the remit of the Committee—the apparent lack of direct accountability for the work of SOCA to the House. I urge the Home Secretary and his colleagues on the Front Bench to look once again at improving in any way that they can the transparency of the important and sensitive work of SOCA and the way in which the agency can be held accountable to the House.

Finally, in an important section of the report there is reference to the fact that the Home Secretary

Although, as I understand it, the study exists, it is a pity that the Committee has not been given early sight of it. We on the Liberal Democrat Benches look forward with some eagerness to hearing the results of the study, because for some time we have argued, as have many others, that the permissibility of intercept evidence in our courts would be an important additional weapon in the fight against terrorism.

Earlier this year the senior anti-terror police officer at the Met, Andy Hayman, advocated the use of intercept evidence in terrorist cases. As we know, in 2004 the Newton committee proposed the removal of the bar on intercept evidence as a more “acceptable and sustainable” approach to the threat from terrorism than the arrogation of new executive powers to restrict liberty outside the normal operation of the judicial process.

We are in a rather anomalous position. According to Liberty, the United Kingdom and the Republic of Ireland are the only countries worldwide that maintain a ban on the use of intercept evidence, yet we accept intercept evidence if it has been gained under the jurisdiction of other Governments. It seems odd that it is not permissible if it has been gained under our own authorisation, but is allowed if it has been obtained under the authorisation of Governments overseas. I hope the Home Secretary will use the study mentioned in the report as a launch-pad to have the debate once again. It has been rumbling on for a long time. I accept that there are a number of practical and legal difficulties, many of which we believe can be overcome.

Like all good reports, the ISC report raises as many queries as it poses solutions—queries related to intercept evidence; the merits or otherwise of an independent inquiry into the events leading up to the
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bombings of 7 July; the importance of the further regionalisation and localisation of the operation of our security and intelligence services; the need to keep a vigilant eye on how the flaws, delays and unquantified costs of delayed IT systems can be remedied; and accountability for the operation of SOCA and other agencies. I repeat my gratitude to all members of the Committee for laying the report before us today.

Mr. Deputy Speaker: Order. It is not quite 8 o’clock yet, but I remind the House that as from 8 o’clock, a 12-minute limit will be imposed on all Back-Bench speeches.

7.48 pm

Ben Chapman (Wirral, South) (Lab): I speak as a member of the Intelligence and Security Committee, albeit of only one year’s standing since the Committee was re-established after the election, and in the knowledge that there are Members in the Chamber tonight who have greater experience and who have served on the Committee before. It is a particular privilege to follow my right hon. Friend the Member for Torfaen (Mr. Murphy), who leads the Committee with such great distinction.

The report of the Committee for 2005-06 can be said to give the agencies a clean bill of health. That is as it should be. They serve us professionally, bravely and with distinction. But the report also expresses a number of concerns, some of which were raised earlier—concerns about the merging of the position of the chairman of the Joint Intelligence Committee with that of the security and intelligence co-ordinator, concerns that the rapid expansion of the services carries risks and needs careful management, and concerns about the overseas part of the SCOPE project.

One notable feature of the report is the planned overall increase in the single intelligence account from a combined amount in terms of resources and capital of £1.1 billion in 2004-05 to £1.5 billion in 2006-07 and to £1.6 billion in 2007-08. That does not include the further £85 million announced by the Chancellor in the pre-Budget report to support the expansion of services, which will allow the earlier delivery of key elements of the expansion and which was initiated in the 2004 spending review.

The significant additional funding made available since 9/11 has generally been accepted as essential to counter the enormous threat that we face from international terrorism and to provide an enhanced standard of coverage and assurance. However, it cannot be that, because an agency’s operations are often secret, it should forgo normal management and financial disciplines—to be fair, no one has suggested that it should.

Given that the current funding and anticipated funding represent an unprecedented level of new provision for the agencies, in the Committee’s view, it is important that functioning mechanisms are implemented to ensure that the money is well spent, that it is appropriately controlled and monitored and that it serves as a driver for increased efficiency. We looked at that matter last year, we shall spend more time on it this year and it will be a key responsibility of the principal accounting officer of the single intelligence account.

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As has been said, the main focus of the Committee’s work in 2005-06 was our inquiry into the 7 July bombings, which is not specifically covered in our annual report. Hon. Members have already referred to many aspects of the matter, but I want to mention the international dimension of the 7 July inquiry. Our report states that greater coverage in Pakistan or more resources in the UK might have alerted the agencies to the intentions of the 7 July group.

I do not want to go beyond what was said in the report, but it is clear that Pakistan is an issue. As the report reveals, two of the group visited Pakistan, where it is likely that they had some training from or contact with al-Qaeda—indeed, the video which was recently released appears to make that explicit. The group’s connections to Pakistan confirm the significance of overseas links and of travel to the development of terrorism in the UK. As has been said, the threat is unconstrained and global.

The Minister for the Middle East (Dr. Kim Howells): I agree with the emphasis that my hon. Friend is placing on overseas contacts and travel. However, does he agree that people too often assume that everything that happens in Pakistan is bad? In fact, President Musharraf has made courageous decisions and taken helpful steps in trying to counteract the influence of dangerous people and trends in Pakistan.

Ben Chapman: Perhaps this goes beyond my brief, but it seems to me that President Musharraf faces many dichotomies, dilemmas and difficulties, which he strives, generally with good intent, to tackle as best he can—as we know, he is surrounded by problems. Earlier, my right hon. Friend the Home Secretary mentioned the Commonwealth, which is also important. As today’s sad events in Mumbai proved again, terrorism is a global issue, and it is no longer possible to separate the domestic and international parts of the problem. Terrorism comes from a range of groups, networks and individuals, which are sometimes linked and sometimes not.

In a series of articles with headlines such as, “Spies hid bomber tape from MPs”, some in the press have alleged that the Committee was not given all the information that it needed for its 7/7 inquiry, that it was not sufficiently critical and that it might have been misled. Although that is not the case in any respect, it is not surprising that such criticisms have been made, because disgruntled ex-staffers and so-called intelligence analysts combine with the press on the publication of the annual report to criticise the agencies and the oversight arrangements.

Some, including hon. Members tonight, have questioned whether the Committee is constitutionally limited in what it can achieve, whether that is because of the limit on its investigative resources, its remit or its constitution, which makes it entirely dependent on the intelligence agencies for its information and on their willingness to disclose such information. As has been said, the Committee’s form has its pros and cons, and I do not argue that, because it is currently so, it should necessarily remain so. The Committee was set up by the Intelligence Services Act 1994, and appointments are
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made by the Prime Minister. Some have said that that gives it the appearance of being a creature of the Prime Minister and the Government, but it is not. We are independent of, not an instrument of, the Government. I believe that our reports confirm that, and, as has been said, members are drawn from all parties and both Houses.

Some have said that out terms of reference to provide oversight of the agencies’ administration, policy and finance are too limited and that we should operate as a Select Committee. We may not always report as the press or others want us to, but it is our job to try, as best we can, to tell it as it is, and I believe that we have achieved that. The Committee now considers and reports on matters that go wider than its statutory remit, and my time on it suggests to me that operating as a Select Committee is neither desirable nor, indeed, workable. There has been no occasion when we were unable to see those whom we wanted to see, when we were unable to obtain the information that we sought or when we did not ask the questions that we should have done, and I have seen no evidence to suggest otherwise.

Our job is to provide parliamentary oversight.

Andrew Mackinlay: There is none.

Ben Chapman: If my hon. Friend allows me to proceed, I may persuade him otherwise.

The Intelligence and Security Committee may not be a Committee of Parliament, but it is a parliamentary committee. We are responsible for oversight, not the day-to-day management of the agencies, so information about operations is often neither necessary nor helpful, and both sides have to conduct their work on a need-to-know basis. Where operations have become interlinked with policy or have policy implications, we have, in my view, always obtained the information that we need.

It is noteworthy that so many other countries setting up their own parliamentary intelligence oversight arrangements draw on the experience of the ISC. Of course, I have no problem with increased powers—nobody likes a bit of power more than me—but the Committee, within its statutory establishment, performs well as it is.

There are those who argue that the nature of the Committee, and the fact that we meet in private and operate within the ring of secrecy, means that there should, for the purposes of openness, be a public inquiry into the tragic events of 7 July, which are so much in our minds because of the recent anniversary. The call for a public inquiry is also made by the press, but often for their own reasons and often on flawed grounds. While I understand the deep concern of the victims and families involved in wanting to know that no stone has been left unturned and that they have got to the truth, it seems to me, even accepting the difficulty with the timing of the rail journey, that the findings of our report and those of the Home Office narrative, which were separately arrived at, are objective, workmanlike and mutually reinforcing.

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