Examination of Witnesses (Question Numbers
60-79)
PATRICK BOURKE,
KARL BANISTER
AND STEVEN
EFFINGHAM
2 FEBRUARY 2010
Q60 Mr Turner: They are irrelevant?
Karl Banister: I would not use
that term
Q61 Mr Turner: But it is true.
Karl Banister: It is a separate
process, I think.
Q62 Chairman: Nobody has suggested
that we cannot ask the Lord Chancellor questions either in Parliament
or in this Committee of Parliament as to how he is exercising
that.
Karl Banister: That is right.
Patrick Bourke: And, as he made
clear when he last appeared before you, he said, "Given that
I am asked PQs, given I am lobbied by Members of Parliament on
behalf of the Crown Dependencies, given that I see the Crown Dependencies
and given that I am respondent in litigation involving Crown Dependencies,
there must be some sense in which the accountability lies."
Karl Banister: I should have added
that, of course, there are other aspects of our powers in relation
to the Islands which are uncontroversially part of Parliament,
such as defence and so on. There is a clear interest there.
Q63 Mr Turner: But is there a power?
Karl Banister: The Islands are
not responsible legally for their defence so the power to do things
in relation to their defence comes from the authority of Parliament.
Q64 Mrs James: Turning to international
representation, we have already heard a little bit about Guernsey's
concerns. How do you ascertain the policy priorities of the Crown
Dependencies? How do you factor these into your work and represent
them across the Government?
Patrick Bourke: This is only international
representation insofar as you consider the UK to be separate from
the Crown Dependencies, but the important thing to understand
is this is a completely dynamic relationship; this is a team of
six plus me at the Ministry of Justice talking to people in the
Crown Dependencies', our opposite numbers in the civil services
of those Dependencies on a daily basis about a whole range of
issues, so we are extremely well-informed about what their priorities
are and I can assure you that they are less than shy about coming
forward and painting a picture for us. We also visit the Island
between us several times a year, and that is not just policy officials
but includes recently Lord Bach in the Isle of Man, and recently
Karl with Louise Moreland from his team also took time to go and
make their mark with opposite numbers in the legal profession
there. We also have a formal meeting every few months where I
get together with the Chief Executives, that would be the Permanent
Secretary equivalent, in each of the Crown Dependencies, and that
is a more formal forum for them to exchange their views and to
tell us a bit about their priorities, so we are really plugged
into the sorts of things they want and, as I say, it covers a
whole range of issues. It can be anything from the nascent space
programme of the Isle of Man all the way through to fishing rights
and territorial waters. We have a recent example in the case of
Alderney which is pioneering a tidal wave renewable energy programme
which is generating huge amounts of electricity, and we are opening
doors for them in terms of speaking to colleagues in the Department
for Energy and Climate Change, and also potentially with the French
because they will need to bring that product to market at some
point, so to answer your question we are very plugged in. How
then do we interact with other people across government? Very
straightforwardly, like in any consultation or any business that
we conduct. We identify the person with the responsibility for
this policy, or the expert who might be available to help, and
we facilitate direct contact. Sometimes we choose to be there;
sometimes we are asked to be there when that contact takes place;
and most of the time we just let them get on with it.
Q65 Mrs James: As a follow-up to
that, in international negotiations how do you ensure in practice
that, consistent with the framework for developing the international
identity of the Crown Dependency, you faithfully represent and
take account of the interests of the Islands, which may differ
from those of the UK?
Patrick Bourke: This is a tricky
area, there is no question about it, but I think it is tricky
only on the surface and, once you get down into the nitty-gritty
of it, it is more straightforward. There are three instances really
to consider on this. One is where, for instance, the Crown Dependencies
and the UK have an interest but it is not conflicting, and there
obviously it is very easy because we are aiming for the same thing.
A good example of that is getting over the bar of the OECD white
list and assigning at least 12 TIEAs (Tax Information Exchange
Agreements) by the time of the G20 conference in London. There
are other occasions, and I have to say they are extremely rare,
where we both have interests but they do conflict, and this is
where we have to accept that the position is we have responsibilities
both to the UK taxpayer to advance UK interests but also to faithfully
represent, as you put it, the interests of the Crown Dependencies.
Recent examples include relations between Guernsey and Iceland,
where clearly they were looking for money to bail out their depositors
and we were looking for the £3 billion that we lent them
to bail themselves out. We got over that in a very pragmatic way,
in a very grown-up way, and we took the view, and Treasury and
Government accepted that we had to do this, that we had to represent
the interests of Guernsey in our negotiation and we did so. That
is not to say that you could expect Treasury to go hammer and
tongs at privileging the position of Guernsey versus the UK's
interest because that would be an absurdity. What we did, though,
was take a pragmatic view which is, having discharged our responsibility
to faithfully put their view across to Iceland, we said, "Now
go and make your case" and we opened the door and facilitated
direct contacts between the Guernsey Government and the Icelandic
Government.
Steven Effingham: I would add
that the example Patrick has used of Iceland is essentially a
crisis situation where things are moving very quickly and, as
Patrick says, a pragmatic way of representing the interests of
Guernsey and the Isle of Man was adopted and representations were
made to the Icelandic Government. In the more run-of-the-mill
representation in, say, the European Union, again Patrick's summary
of it is correct. In principle it seems quite difficult to wear
two hats and represent Crown Dependencies and at the same time
represent the UK, but in practice it is reasonably straightforward.
Partly what is happening there is we are not having a discussion
in a vacuum where, for example, if we were negotiating on the
European Savings Directive I would be wrestling with myself over
which of my two hats I was wearing; we are in the context of a
multilateral negotiation with other Member States with institutions
such as the Commission, and essentially, to answer the Chairman's
opening question "What do you do?", in situations like
that we set out the UK position, we also set out the Crown Dependencies'
position, we make it clear where they stand and where their interests
stand, and we get feedback from our negotiating partners and from
the European Commission on essentially how likely it is the support
in the negotiation is going to tend towards the Crown Dependencies'
view or to the UK's view, so it is an on-going dynamic situation.
It is not a case where we would sit silently and say nothing on
the position of the Crown Dependencies; that is not our role.
We do have a duty to represent, and other participants in the
negotiation would expect us to, because I think in most international
arenas there is still a slight confusion as to the status of the
Crown Dependencies, are they part of the UK or are they independent,
what is the story, so there is clearly an expectation that we
will cover those issues. In practice, therefore, it is a matter
of making sure we understand Crown Dependencies' concerns and
positions, which, as Patrick says, we pick up from day-to-day
largely informal contact but very frequent contact, I am in contact
with tax officials in the Crown Dependencies almost as much as
I am with the major European Union countries, so we understand
the positions, we discuss, we debate, and then we represent the
interests.
Q66 Chairman: When you have a bilateral
negotiation, as happened with Iceland, and there are quite clearly
strongly conflicting interests between the UK and the Crown Dependency
that is solving the problem of one but not answering the problem
of the other, if you are not careful, why not have two teams and
have one team advised by Crown Dependency officials? So you are
still under the charge of the Treasury official but there is somebody
different saying: "Well, I am here today to explain that
the Isle of Man government, for example, feels that it should
have the money from the Icelandic Government to repay depositors
from the Isle of Man, some of whom incidentally were UK citizens"?
Steven Effingham: I understand
the suggestion and I was not personally involved in the detail
of what was happening in the Icelandic situation, but my understanding
is this was a fairly fast-moving crisis and the opportunity to
reflect on what might be the ideal representative model may not
have been available. The model which was pursued was that the
UK Ministers wrote on behalf of Guernsey and of the Isle of Man
setting out their case, but in the end the responsibility of ministers
to protect the interests of the UK taxpayer prevailed, as it were.
Q67 Chairman: So it is hard lines
for Crown Dependencies, then?
Steven Effingham: I think in this
situation ministers did press the case but, as you say, there
were conflicting priorities and in a crisis and with the realities
of the expense and cost to UK taxpayers, and also the position
of the UK investors, the primary responsibility under the obligations
as they stood under the Directive lay towards the UK taxpayer.
That was the judgment ministers took, but that may be something
that when ministers give their evidence you can explore in more
detail.
Q68 Rosie Cooper: There is a bit
of an overlap here in that the question I would like to ask you
is whether you believe that there is sufficient awareness across
other government departments about the need to take into account
the interests of the Crown Dependencies, especially in areas where
there may be a conflict of that interest? Do you believe that
the departments are aware of that, and that is right across all
government departments?
Patrick Bourke: The blunt answer
is no, I do not. I do not think everybody is as sensitised to
these issues as they would, in an ideal world, be. That is not
to say there are not some excellent examples where people really
are aware; the Department of Health is an example. In departments
where we have a more regular contact, because Crown Dependency
issues tend to recur for them, obviously the situation is much
better. We are taking some steps to address that. In relation
to the more process-driven type of activity we were talking about
a second or two ago in terms of the process of legislation we
have developed a series of new protocols which document how that
process should work and set out the rights and responsibilities
of the Crown Dependencies and ourselves in meeting deadlines and
what those deadlines are, et cetera, but they also incorporate
the responsibilities of OGDs (Other Government Departments) when
they are consulted in that process. We are in negotiation with
other Crown Dependencies about the content of those protocols
but we are very hopeful we will be able to use them as a tool
for raising the profile and the sensitisation to these issues
by sending them out to departments with a strong message from
our Director General and our Chief Legal Adviser, and I know Karl,
through the Government Legal Service network, does all he can
Q69 Rosie Cooper: But do you think
it is right or fair that the people dealing with it are not fully
aware that whatever decision they take will impact on the Crown
Dependencies?
Karl Banister: I will pick up
where Patrick left off and say that it may not be right or fair
but it is a bit like painting the Forth Bridge to some extent.
As people change in departments there is a continuous need, as
in any other area, to maintain awareness. The Government Legal
Service has training for lawyers on various issues and we supply
one of our team to deliver training at particular events that
seem relevant on Crown Dependency issues, so that is part of our
contribution to the process of maintaining awareness. At a particular
snapshot point awareness could be very good but you have to keep
working at that, and that is just a natural organic process.
Q70 Rosie Cooper: Would the ideal
situation be them maybe taking their bat and ball home and looking
for better representatives?
Patrick Bourke: They are very
welcome to.
Q71 Chairman: Can we look at an example
of this which is the ending of the reciprocal health agreement.
In a report to Tynwald the Isle of Man Department of Social Security
said that at a meeting with the UK Department of Health on 1 July
2008 which was to discuss the reciprocal agreement, without any
pre-warning the Department was notified that the UK Government
intended to end the reciprocal agreement. Were your officials
involved in any process prior to that, or is that, do you think,
an accurate description of what happened, that basically they
went along to a meeting to discuss perhaps some new financing
arrangement for it, and they were just told, this is it, it is
going to end, and in the case of the Channel Islands it has ended
already; the Isle of Man negotiated a later date and it is not
ending until this year. Did your processes engage there, or does
the Department of Health just bypass the Ministry of Justice?
Patrick Bourke: To be perfectly
honest I do not recall, I am not even sure I was around at the
time those discussions took place, but by and large we are involved
at the outset, certainly by government departments like Health
who are more sensitised to these issues. The policy is a matter
for the Department of Health, clearly, but I think it is worth
knowing, or worth noting, that the ending of reciprocal healthcare
agreements in all three jurisdictions was agreed by the States,
Tynwald in the case of the Isle of Man, and has only resurfaced
very recently in a way that I am not convinced has been terribly
helpful to the Isle of Man because, as far as they were concerned,
they accepted the decision and wanted to move on. I do not know
whether we were given notice or whether somebody in my team participated
in those discussions but, generally speaking, it does work really
rather well.
Q72 Chairman: Would you like to write
to us about that? It is a factual question. Did the Department
of Health simply arrange a meeting and say: "We are ending
this agreement" without any involvement of the Ministry of
Justice at all, or was the Ministry of Justice involved in the
process? It is quite important to the understanding of how these
things happen because whatever they had to accept there is no
doubt that there are very strong criticisms in certainly the Isle
of Man and Guernsey, and probably in Jersey as well, about the
implications of this, although conversely the Department of Health
took the view that it was costing them a lot of money; that it
was costing us a lot more than it was costing the Crown Dependencies.
Patrick Bourke: I am very happy
to write. As you say, it is a factual question. I would just add
that, by and large, it does work rather well. I would love a perfect
system where everybody was immediately thinking "Ministry
of Justice" when a Crown Dependency raised its head, but
it is just not the real world, I am afraid.
Mr Heath: I wish I was convinced even
the Ministry of Justice thought that, but I guess I have been
doing Criminal Justice Bills for ten years or thereabouts, either
through the Home Office or the Lord Chancellor's Department or
the Ministry of Justice or whoever, and one of my favourite ploys
at some stage in the proceedings is to ask, when it refers to
anything international, how does this affect the Crown Dependencies,
and not once have I had a sensible answer from the Bill team;
not once have they known and been able to advise the minister
whether it affects the Crown Dependencies or not. So would it
be your normal habit when a Bill is introducedfrom the
sound of it you scrutinise it to see if it has implicationsto
send a note to the Bill team to say either "This has implications
for the Crown Dependencies" or "This does not have implications",
because it certainly has never yet got through to a minister responding
to me in Committee.
Q73 Chairman: Is that your job? Is
there somebody in your team whose job it is to sit and look at
every Bill that comes forward in the UK Parliament and check whether
it has implications?
Karl Banister: It is the primary
responsibility of the Bill team concerned to do that.
Q74 Mr Heath: If it is any help,
they never know how it applies to Courts Martial either!
Karl Banister: It is not only
application or not to Crown Dependencies where it falls foul;
devolution, too, is another issue where there is not perfect coverage,
but it is the responsibility of the Bill team to consider these
issues, and although I agree that at the outset it may not be
the thing that is highest on their mind, by the close of the process
we will have an agreement as to whether or not it is intended
that legislation is extendable to the Channel Islands, and there
is a clear formula for doing that. It is not unknown at all for
this to happen quite quickly at the last minute, but it is a responsibility.
We are there to assist the Bill teams in finding the right formulation,
and we do discuss the policy requirement and whether it is objective.
There was very a complicated example recently in the Police Act
where provisions about the Criminal Record Bureau were to be extended
and that was a very difficult process because it was extending
a whole series of pieces of legislation that had been amended
by the Police Act and so on, and we are involved because we have
the expertise on how to do that but we are not the experts on
the policy, so they supply the policy expertise to us.
Q75 Jessica Morden: In some of the
evidence we have had from the Islands there was sometimes a bit
of frustration about the length of time it would take to deal
with queries or legislation, or sometimes the short amount of
time that the Islands had to respond when the UK was negotiating
an international treaty. Do you think that is a fair criticism,
and do you think there are enough of you? Are you under-resourced?
Patrick Bourke: The resources
we bring to bear are not inconsiderable and I think they are appropriate
to the job as it currently stands. I mentioned that I have six
full-time officials working on nothing but Crown Dependencies
which is quite a significant commitment for a policy team at the
best of times, but in this sort of environment it is still fairly
remarkable that we have managed to keep it the way it is. It is
not just policy officials who are engaged in this, but also the
lawyers. You have to think that you have the core team at the
Ministry of Justice but then you have potentially hundreds of
policy officials and government lawyers who are, at any given
moment, working on something Crown Dependency-related. I alluded
earlier to the fact that no system is perfect and I am sure there
are occasions where matters should have been expedited in a way
that just did not happen, for whatever reason, so we can always
make improvements and we would be the first to say that. In fact,
devising the protocols was not at the behest of the Crown Dependencies;
it was an initiative on our part which imposes more stringent
timelines on our response than currently exist, so no system is
perfect; we do pretty well; and I think the resources are adequate.
Karl Banister: On the legal side,
we have four lawyers who spend part of their time considering
Crown Dependency-related matters, which gives us quite good flexibility
to have someone around at any particular time who might be able
to look at something, but I would also say that if the reverse
was the case and the situation was that every time there was a
Crown Dependency-related matter we were able to deal with it instantly,
you might be asking us, "Are you over-resourcing this?"
because we have to prioritise and it is the same in relation to
any other policy area.
Patrick Bourke: Building on that,
that is entirely right. Activity in the Crown Dependencies tends
to go in cycles, so in the run-up to the end of the States of
Jersey session we get a lot of requests for rapid assistance because
they want to tie up the business. Equally, on the Sark front,
when we were dealing with that, we were spending inordinate amounts
of time on Crown Dependency, and you have to be resourced at the
right level to enable you to accommodate the peaks but also deal
with the troughs, because you would not want a Crown Dependency
team sitting idle for a couple of months. That would be intolerable
from the Secretary of State's point of view.
Q76 Chairman: There seems to be a
particular Alderney problem which arises primarily from the fact
that things have to go through Guernsey for Alderney, but which
is exacerbated on their evidence by the fact that as a very small
territory they have a cycle of meetings where their part of the
decision-making process has to go, which sometimes is impossible
to accommodate with the time-scales that result from this three-tier
process. Are you conscious of that? This was in their evidence
to us.
Karl Banister: I am not conscious
of that. You having mentioned it, it is something that I could
discuss with my counterparts. We do have regular contact with
Guernsey law officers.
Q77 Chairman: In the case of both
Alderney and Sark, they are processed through Guernsey, are they
not? Guernsey brings their proposals to you?
Karl Banister: That is right.
There is an inevitable delay in having a two-tier system, but
I know I would be speculating to go further. It is not something
I have discussed with anyone before.
Q78 Dr Whitehead: Who is responsible
for the seabed around the Crown Dependencies?
Patrick Bourke: Can we take that
away and write to you about it?
Q79 Dr Whitehead: As a supplementary
to that, following, for example, the passing of the Marine Bill
in England and Wales, not Scotland, there are grades of responsibilityinside
six miles, six to 12 miles, and then licensing arrangements up
to 200 milesall of which are the responsibility of the
Crown Estate, which is not the responsibility of the Parliament
but of the Crown Estate, and it would appear in principle, therefore,
that since Crown Dependencies are also relating to the Crown and
not to Parliament, the two might look they are identical, but
I do not think they are.
Patrick Bourke: It is a very interesting
question and we shall consult somebody who does know the answer.
Could I just add one point on the international relations, because
I think it is quite important for the Committee to have a fully-rounded
picture? I said there were three situations to considermutual
interest, conflicting interest and a third category, and this
I think is the way forward from now. As you know, on occasion
we entrust the Crown Dependencies to go and negotiate on their
own account with third countries, and that has been the case with
tax information exchange agreements, so we are very specific about
the scope and it is on an agreement-by-agreement basis, and that
has worked really well because as their economies internationalise,
like all of us, they are wanting to reach out a bit more and we
are very receptive to that, and one of the things we are in the
early stages of designing, with their help, is, if you like, a
block entrustment which would provide them with greater flexibility
both in terms of the scope of the agreements and the scope of
their negotiating partners, but which would provide us with a
long-stop guarantee that we are not engaging in obligations that
we would not be ready to stand by. As an example of how we are
responding to the changing needs of the Crown Dependencies, however,
particularly around the international representation side, they
want to do more for themselves, and on certain conditions we are
happy for them to. We just have to find a mechanism to make it
work.
Chairman: Thank you very much indeed,
gentlemen.
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