Crown Dependencies - Justice Committee Contents


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 introduced—from the sound of it you scrutinise it to see if it has implications—to 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 responsibility—inside six miles, six to 12 miles, and then licensing arrangements up to 200 miles—all 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 consider—mutual 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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