Taken before the Joint Committee on the Draft Corruption Bill on Wednesday 4 June 2003
Vera Baird Bernstein of Craigweil, L.
Mr John MacDougall Campbell-Savours, L.
Memorandum submitted by Lord Falconer of Thoroton
Examination of Witnesses
Witnesses: LORD FALCONER OF THOROTON QC, a Member of the House of Lords, Minister of State for Criminal Justice, Sentencing and Law Reform, MR PAUL STEPHENSON, Leader, and Ms Michelle Dyson, Solicitor, Bill Team, examined.
Q446 Chairman: Minister, thank you very much for coming. We have realised already in this Committee that there is a view that something has to be done with the law, the definition of the law, and perhaps its application, and perhaps that the existing statutory law and the common law as it stands are not very satisfactory. The question, however, has been very much raised as to whether the Law Commission 1998 report, which I think you very largely followed in the draft Bill, is really the right way to go about it. That is one of the things we are looking at. As a preliminary matter, could you tell us whether the Government did consider alternative options before following the Law Commission's report?
Lord Falconer of Thoroton: We did. There were a range of alternatives. You could have a Bill without any definition of "corruption" or "corruptly" in it at all and simply, as it were, leave it to the good sense of the jurors or the common law to determine what "corruption" meant. The difficulty with that would be you would end up with potentially differing definitions of "corruptly" from one case to another. We also took the view that if you did that you would be dealing with a situation where unlike the phrase, say, "dishonesty" there is not a popular view necessarily of what "corruptly" means. We were not attracted by the idea of having no definition of "corruptly". An alternative approach is to take the approach in the South African Bill. I am told it is not law yet in South Africa. What the South African approach has been is effectively to create 23 different sorts of offences of corruption, so it will be much, much more specific. We thought the problem in relation to that was if we were too specific we might catch things we would not necessarily as a matter of policy want to catch and you were not be leaving it enough to the jury to decide what the right solution was. Yes, the answer is we did consider other solutions, and the range is really from having a Bill but no definition of "corruption", to having something pretty precise like you have got in the South African Bill, and we have gone for a middle course which we think embraces both simplicity but also clarity and codification.
Q447 Chairman: We have had quite a lot of opinions expressed to us that probably it would be easier for jurors and perhaps more clear to people who might be committing a corruption offence if we did have some specific offences. It was suggested to us that if you wanted to make sure that the wrong thing is not included that you could do that either by way of exceptions or a very narrow definition.
Lord Falconer of Thoroton: I do not know if you have had a chance to read the memorandum that I recently put in.
Q448 Chairman: Yes, I have seen that.
Lord Falconer of Thoroton: It is a very truncated way of doing it but in the annex it is broadly seeking to define the sorts of questions the jury would have to answer if our definition in the Bill was followed. We think it has got the merit of simplicity, although if one looked at it initially one would see it has got quite a number of clauses to it but it is clear enough, we think, for a judge to direct a jury in such a way that the jury would be well able to understand what the question was. We also think that it catches the essence of what, as a matter of policy, the definition of "corruption" would be. I should make it clear that if it can be done in a better way, one of the purposes of pre-legislative scrutiny is to hear whether there are better ways of doing it and we are completely open-minded if there is a better way of doing it. At the moment we are not particularly attracted to the South African approach which does involve myriad offences which we think is too complicated because one of the aspects of this, we think, which is quite important is not just what goes on in court, which is very, very important, but the ability to be able to identify, whether you are in the public service or whether you are in private enterprise, what is corrupt and what is not. You cannot provide a complete definition but if you went down the South African model, how complicated would the guidance from the local authority or head office be? We think pretty complicated.
Q449 Chairman: A number of witnesses have said to us that they find the definition in 5 very, very difficult and they think it would not be easy for a jury to follow clearly. I note in your memorandum you say that the jurors may find the language at first sight rather complex but the judge should be able to give sufficient direction to make it all right.
Lord Falconer of Thoroton: I know you have read it but if you take, in the annex, the public sector examples: Jones is the briber who is trying to get a licence, did Jones offer Peterson, who is a local authority official in charge of licensing, unlimited free drinks from Jones' pub once opened, Jones trying to get a licence, and did Jones believe that if Peterson granted the licence it would have been primarily in return for the free drinks? That is the distillation of the clause. Can we put it more clearly? We would welcome more suggestions in that respect. I do not think the way the questions are defined, which is how we would hope a judge would define them for a jury, cause difficulty in comprehension and understanding.
Q450 Chairman: It is not just for the judge and jury, it is also for the lawyer and his client. If the client says to the lawyer, "Is this something I can properly accept by way of commission or whatever", it is suggested that perhaps it is not going to be very easy to apply the definition as it is at the moment. In view of what you have said we will consider it in the light of all of the evidence.
Lord Falconer of Thoroton: I apologise for interrupting but I hope I am making it clear that we do take the view, and I think you agree but I am not sure, there should be some definition, there should not just be a gap left for, as it were, treat "corruptly" as an English word and let the jury decide. We think there should be some definition.
Q451 Chairman: Have juries in the past found "corruptly" a difficult concept?
Lord Falconer of Thoroton: I have asked about that. What we have had is a variety of definitions given by courts. I have not got statistics, I have not been able to get them, as to whether or not there have been, as it were, acquittals when there should have been convictions. I cannot identify for you cases where the facts are broadly agreed and yet what a reasonable man would think was an odd verdict reached, or the other way around. I cannot say I have got any evidence which says juries have had difficulty with the word "corruptly". There must be some support for the view that it is difficult if judges over the last 112 years, running from 1889, have been taking a whole series of approaches to the word "corruptly". You might not think that judges necessarily represent the views of jurors but if they define it differently on different occasions that suggests there is some difficulty.
Q452 Chairman: It may be difficult to get uniformity of judicial definition but I thought the practice was in a High Court the chief justice would give working directions and that should ensure consistency. What would be interesting for us is to know whether or not you or your officials have any real body of evidence to show that prosecutions have failed where they ought to have succeeded because the jury had not got over "corruptly" properly.
Lord Falconer of Thoroton: I cannot identify any such cases and I have asked. I will ask again.
Q453 Chairman: Is there a feeling that this is going wrong because of the lack of ----
Lord Falconer of Thoroton: What I have picked up in the work that has been done is that there is a feeling that "corruption" has a movable meaning, it is not easy to get hold of, the courts have taken differing views over the years as to what it means. Before the Harvey case there were two conflicting definitions in play. I am told that business to some extent is keen to see it codified because they too have been uncertain about what is meant by "corruptly". I cannot identify for you individual cases, nor have I got any statistical evidence I can put before you.
Q454 Chairman: With this sort of wording all sorts of directions have different shades and different meanings, it is like "honestly" and "dishonestly" at times.
Lord Falconer of Thoroton: You mean the definition in our Bill? We have tried to keep it tight and there is obviously room for judgments to be made, for example, as to what is meant by "primarily", which is one of the important aspects in the definition. Again, we think there is no formulation that you could have that did not, and in my view rightly, leave it to the jury to make fundamental decisions about what was going through the mind of the defendant.
Q455 Chairman: So you support the idea, do you, that outside this Act it is probably alright for the judge to say "You all know it is a common word and you can apply it as you like" but inside the Act we should have a definition of "corruptly"?
Lord Falconer of Thoroton: The reason why I am not attracted by the idea of saying "Corruptly, we leave it to you to make up your own mind, members of the jury" is because that has led to people trying to define it and it has led to conflicting definitions. Therefore, I think we do need to go some way to try to pick up what the essence of corruption is.
Q456 Lord Campbell-Savours: Can I just take you back a step. The other Bill going through the Commons, the Criminal Justice Bill, provides for a trial effectively by a judge.
Lord Falconer of Thoroton: In serious fraud cases and in cases where the jury has been intimidated, or there is a risk or a fear that the jury may be intimidated, or where the defendant himself elects for trial by judge alone.
Q457 Lord Campbell-Savours: Is it possible that these kinds of cases may well be tried under those procedures?
Lord Falconer of Thoroton: It is possible for a defendant in these cases to elect for trial by judge alone. I do not think they would fall within the serious fraud ambit. I assume it is possible that there could be intimidation. I do not know but there is no limitation on the intimidation provisions in the Criminal Justice Bill, so it is possible that a corruption case could be, in theory, tried by a judge alone because of intimidation.
Q458 Lord Campbell-Savours: But is it not distinctly probable that most of these cases will be tried under that arrangement?
Lord Falconer of Thoroton: No, I would have thought only a handful would be affected by intimidation. I cannot tell you the extent to which judge alone would be the election of a defendant in a corruption trial.
Q459 Lord Campbell-Savours: They are the only circumstances in which that would arise?
Lord Falconer of Thoroton: Yes.
Lord Campbell-Savours: I am not a lawyer.
Q460 Chairman: Just thinking again about the definition, one problem which has been raised a number of times is the retention of the agent/principal concept. Sir David Calvert-Smith told us: "I am sure it would be easier for prosecutors were we to focus on the passing of the bribe rather than on the agent/principal relationship. It is easier, I would say, for ordinary folk to understand that when the money changes hands, that is when the offence is committed, rather than in the breach of trust between the agent and his or her principal." Do you think that it would be possible to place the offence on the passing of a bribe rather than on this concept of principal and agent and breach of trust?
Lord Falconer of Thoroton: We thought about that and we thought about it again after Sir David had said that. I do not know if you have seen the example of "I want my house surveyed". There are two surveyors and one surveyor says, "If you have me as your surveyor rather than the other surveyor I will give you free tickets to Arsenal football ground for the next year". There is nothing wrong with that because I am the only person involved. You might say in common parlance there is a bribe, but there is nothing corrupt about it. Whereas there would be corruption if, instead of having the house surveyed for myself, I was having the house surveyed, for example, for a company for whom I worked. I would then be putting my own personal interest above my duty to the company. We think if you apply that to the public sector, where you say to a public official, "Will you give me this particular licence because I will give you free tickets", again the public is not getting the intention it is entitled to. It is difficult to think of occasions when the essence of corruption is not cheating on the person who you should be looking after.
Q461 Chairman: The person you work for, your principal?
Lord Falconer of Thoroton: Exactly.
Q462 Chairman: It does mean sometimes that a deal between two principals where there is not an agency relationship might slip through the net.
Lord Falconer of Thoroton: I am sorry, say it again.
Q463 Chairman: Unless you can find a relationship between the principal and agent then I am suggesting that many cases might slip through the net if you had negotiations between two principals. We will come on to a detailed example later. That would not necessarily be covered by your reliance on the agent/principal concept.
Lord Falconer of Thoroton: Let us hear some examples. There is obviously an issue about the public. If I am the chief executive of some public sector organisation, even thought I might be said to be acting as principal, if I have got an obligation to the public, and we make that clear in the Bill, that should be corruption as well.
Q464 Chairman: A number of difficulties have been expressed to us about this definition and we will come on to specifics but I want to do a general review to begin with.
Lord Falconer of Thoroton: My answer in principle - meaning it in a different way - is we think the essence of corruption is cheating on the person who trusts you or cheating on the public. That is why we have focused, as you rightly say, on the principal/agent or agent/public relationship.
Q465 Chairman: Could you not do that by a definition which picks up the trust concept rather than the principal/agent concept?
Lord Falconer of Thoroton: We think at the moment that the principal/agent or public/public servant relationship is the best way to do it. If there is a better way of doing it we will obviously consider it.
Q466 Baroness Whitaker: Nice to take your views twice in one month, Minister. I rather missed in the Bill the idea of the person bribed having a private advantage at the expense of a public or organisational benefit and that is not captured in 5. I am not asking for an immediate answer now but I just wondered if you could consider how that could be captured because there is nowhere in the whole Bill the idea that somebody makes into their private pocket something so that the public gain, or the intention of the whole organisation, is thwarted or skewed.
Lord Falconer of Thoroton: We were very keen to capture that and when we talk about "agent for the public", that is what we are talking about. Take the obvious case: if a local authority planning officer gives planning permission for money rather than the merit of the planning application, that would be a plain example of somebody putting his private advantage above his obligations to the public, he is an agent for the public in those circumstances, that is plainly caught.
Q467 Baroness Whitaker: I think it is because we know what corruption is that we understand clause 5 but if you were in a different country I wonder because it could cover planning gain, perhaps.
Lord Falconer of Thoroton: Taking the planning officer example again, and I may have got the basic structure of planning wrong, if he said "I will not charge you any planning gain in giving you this planning permission because you have given me free tickets to Arsenal for the next year", that plainly would be corrupt and would be caught.
Q468 Baroness Whitaker: If a local authority says "We will give you the contract if you not only put up these buildings within our price range but you also contribute to our sports ground or you do not build on the adjoining land", none of which goes into any private pocket, nevertheless it enables somebody to get the contract.
Lord Falconer of Thoroton: That is perfectly legitimate.
Q469 Baroness Whitaker: That is not corrupt at all.
Lord Falconer of Thoroton: Not at all.
Q470 Baroness Whitaker: But is it not thwarting 5?
Lord Falconer of Thoroton: No, most certainly not, because there, plainly, the agent in seeking to extract the planning gain is acting on behalf of the public.
Q471 Chairman: Can you say that any deal done where the aim is to confer a benefit in the third person, here talking about a sports field or something, is irrelevant for the purposes of corruption?
Lord Falconer of Thoroton: No, you cannot, but I am not saying that.
Q472 Chairman: No, you are not. I am moving from the particular example to a general statement of principle.
Lord Falconer of Thoroton: In some cases if a benefit would be conferred in the third person then it would be a bribe in effect.
Q473 Chairman: Can I just ask you two or three questions which arise, again, out of evidence which has been given. In the Explanatory Notes to the Bill it is suggested, I think, that the impact of the Bill, the changes in law, on businesses and the voluntary sector and charities, is negligible. We have been told two things. Firstly, we were told by one organisation that it was very surprised that there had not been a Regulatory Impact Assessment. The second thing we were told by two organisations was that they really needed clarification of the scope of the Bill and in particular its effect on the payment of commission in the financial service and insurance industries. The Association of British Insurers in their statement said: "the abstract way in which the new offences in the Bill are framed may lead to certain activities being caught inadvertently". The Investment Management Association said: "as it stands, many such commission payments could be deemed 'corrupt' unless the defence could establish that the agent's principal knew all the material facts and had consented to the specific payment." In the first place, was there wide consultation of industry and commerce about the definition in the Bill?
Lord Falconer of Thoroton: There was. You know the history: the Law Commission's consultation paper, the Law Commission's final paper, the Government's White Paper in 2000, response to the White Paper in 2000 and now pre-legislative scrutiny. The process of the matter being looked at has been going on for in excess of five years.
Q474 Chairman: I was thinking more of the actual terms of the draft Bill. The Law Commission's report is quite a long time ago now.
Lord Falconer of Thoroton: But the Law Commission's report does have a draft Bill annexed to it, which is quite similar to the Bill we have gone with today, and the White Paper produced in 2000 also has a Bill attached, or indicates it is going to go with the Law Commission Bill. We have spoken to the Institute of Chartered Accountants, the Institute of Directors, a number of corporations, such as Kingfisher and Lloyds plc. You referred in your second point to the insurance industry and the Association of British Insurers first responded with that point after the publication of this particular Bill, but I venture to suggest that the issue was already apparent on looking at the Law Commission Bill. That is not an answer because, however we have got here, we need to talk to everybody. We have spoken to these people and inevitably as you go through pre-legislative scrutiny new points arise.
Q475 Chairman: Perhaps the draft Bill at the end of the day, because it is a lot shorter, draws people's attention to things more precisely than the Law Commission's report?
Lord Falconer of Thoroton: This is a lawyer's point which you will find deeply unattractive, but it is not that much shorter than the draft Bill in the Law Commission's paper; indeed it is slightly longer. The point was there in the Law Commission's paper.
Q476 Chairman: They asked whether a Regulatory Impact Assessment should have been carried out: should it?
Lord Falconer of Thoroton: The view we have taken is no, because the purpose of the Bill is to codify and clarify and we believe that the effect will be not to capture any significantly greater series of cases than are already captured. Do you want me to go on to the second point, which is the financial services?
Q477 Chairman: Yes.
Lord Falconer of Thoroton: I assume that what people have in mind in relation to the financial services issue is where an independent financial adviser advises his customer "Go with this pension" or "Go with that mortgage", and, in fact, instead of advising the customer to do it on the basis of what is in the customer's interests, he does it on the basis he gets a higher commission from mortgage company X than he does from mortgage company Y. If that is the reason why my own independent financial adviser has given that advice then that potentially is corrupt under the Bill. Does it lead to a greater risk of prosecutions than previously, I am not sure that it does and I am not sure that the Association of British Insurers are saying they would necessarily want to countenance independent financial advisers giving, as it were, their own clients advice based on the levels of commission.
Q478 Chairman: One has obviously got to be careful that legitimate commission payments in the financial sector are not caught by this. Have you considered whether this Bill is more or less likely to pick up legitimate commission payments?
Lord Falconer of Thoroton: How does one put this? If my motivation, as the independent financial adviser, in giving you the advice is solely because I get a higher commission, I am not sure you would describe the commission as illegitimate but, nevertheless, I am not acting pursuant to the trust you place in me in those circumstances. That should not be lawful anyway at the moment.
Q479 Chairman: Very much in this area too, one question which we have been asking, and people have raised with us, is the question as to what sort of activities which now would be lawful, apart from the position of MPs, would become unlawful under your Bill? Perhaps even more important, what offences cannot in practice now be followed through and prosecuted which will be caught by the Bill and will enable prosecutions effectively to take place?
Lord Falconer of Thoroton: There are certain things on the margins. For example, the 1906 Act does not extend to bribery of a third party, whereas the 1889 Act does. In the public sector, bribing a third party does constitute a crime where it does not in relation to the private sector, but that, I accept, is pretty on the margins. Again, I have asked the question that you have asked, what does this cover which it did not cover before, and it is very hard to identify specific cases. I have not got any specific cases, apart from the very marginal legal issue that I have just referred to. We do think it is of benefit to do this because of the codification and the clarification. It is because we do not think that there is a substantial increase in coverage that we did not have a Regulatory Impact Assessment.
Q480 Chairman: So you do not anticipate a new wide range of criminal prosecutions? There will be some more obviously.
Lord Falconer of Thoroton: There will be some more because of clarification and codification but that would be because of the law being more readily accessible rather than because the law is now catching that which it had not caught before.
Q481 Chairman: So the only deliberate extension comes in relation to Members of Parliament perhaps?
Lord Falconer of Thoroton: That is right. We do not believe for one moment that is going to lead to ----
Chairman: We will come on to that a little later. Lady Whitaker, I think you wanted to ask something about the meaning of "corruption".
Q482 Baroness Whitaker: Again, in connection with the underlying concept, looking at clause 7, which is a defence against corruption, I thought of that against the context of a different way of approaching corruption: who are its victims? It seemed to me that the victims were the competitor in a rigged market, the body which agreed the money obviously if it was a public authority and they are cheated of the purpose they have, but even a private board would be a victim if the company employee had not produced best value or had undercut the market. Most of all, the end user is the victim, particularly in the case of public corruption but also in private corruption if it was a block of flats which had collapsed in an earthquake because the tender had been corruptly obtained, for instance. I cannot see how those victims, if they are the true victims of corruption, are protected in clause 7 if we were looking at the private sector.
Lord Falconer of Thoroton: In relation to the private sector ----
Q483 Baroness Whitaker: Because that is what it is about, is it not?
Lord Falconer of Thoroton: What we are not seeking to do in this Bill is require companies in full possession of all the facts to enter into the best possible deal. There is freedom of contract in this country and as long as they know precisely what is going on then they can enter into the contract that they wish. I am talking about in a private to private contract. What you are saying, in effect, is where the company is fully aware that the benefit they will get is, say, they can all go to Arsenal - I keep giving that as my example - if they know what is going on, that is legitimate.
Q484 Baroness Whitaker: So even if a construction company gets a tender through bribery and the building endangers the public, that act is not corrupt, getting the tender through bribery?
Lord Falconer of Thoroton: Suppose that I, a private individual, have two tenders to build my house and one is more expensive than the other but the person offering to build it for more money says, "It will cost you a million quid more and it will not be as good as the other one, but I will service your car free for the next year and a half", am I entitled, as a private person, to accept that?
Q485 Baroness Whitaker: But you are not the owner, say you are the developer and it is the tenants who will have to live in the bad building and you, the developer, have got the free servicing. Is that not corrupt?
Lord Falconer of Thoroton: If the standard of the building does not fall below any legal limits then is it not open to the developer - I must emphasise it is a private developer in your example - as long as he knows what he is doing, that he is not being cheated by his own middle management, to enter into such contracts as he deems appropriate.
Q486 Baroness Whitaker: And the other contractor who missed out, even though he had the better value to offer, is he not a victim of corruption?
Lord Falconer of Thoroton: I do not think that he is in those circumstances. What would happen in the example you gave is every time a particular benefit was offered by one contractor with the full knowledge of the buyer, could every other contractor try and encourage the police to bring criminal proceedings when the buyer was fully aware of what was being offered and decided, for whatever particular reason, to take the other tender?
Q487 Mr Stinchcombe: Carrying on that same line of thought, what happens, for example, if the Ministry of Defence is putting out to tender a contract to supply armaments and two private companies agree among themselves that one will pay the other five million quid in order for that one not to put in a tender leaving a free run for the tendering company to put whatever tender it wants to, meaning the public purse pays more than otherwise it would do? That would not be an offence.
Lord Falconer of Thoroton: It would not be corruption within the meaning of this offence. There would be other anti-competitive provisions in anti-competition law which would prevent that happening, on your analysis, if the Ministry of Defence were not involved in that at all, there was nobody bribed in the story, there was no agent who was, as it were, by some sort of benefit persuaded to act contrary to the trust placed in him.
Q488 Mr Stinchcombe: But if you got rid of the restriction that corruption could only take place where an agent/principal relationship existed then you could include that as an offence within this type of Bill.
Lord Falconer of Thoroton: I would like to see it done. I think you would find great difficulty in identifying something which was not much, much too wide. I do not rule it out. If you can put it in such a way that it does more effectively that which we are trying to achieve, then that is possible. In the example you have given we think the much more sensible way to deal with that is to deal with it on the basis of anti-competitive practices, cartel practices, dealt with in the monopolies and anti-competitive legislation, the Competition Act.
Q489 Mr Stinchcombe: I put tentatively a kind of way forward, I do not propose it is the right way forward. If you look at clause 1 that tells us that the elements of the offence there are "corruptly to confer an advantage", so somebody has got to confer an advantage if it is corruptly done.
Lord Falconer of Thoroton: Yes.
Q490 Mr Stinchcombe: It is clear that the only word there that can possibly confer illegality is the word "corruptly" because "to confer an advantage" ordinarily would not be an offence at all.
Lord Falconer of Thoroton: Agreed.
Q491 Mr Stinchcombe: Therefore, the word "corruptly" needs to be defined to embrace the wrongdoing that makes the illegality.
Lord Falconer of Thoroton: Agreed.
Q492 Mr Stinchcombe: You could, for example, put a definition of the word "corruptly" that says something like "to intend wrongly to influence somebody".
Lord Falconer of Thoroton: Wrongly to influence? Who would you be influencing?
Q493 Mr Stinchcombe: In my example you would be wrongly influencing somebody not to proceed their own tender.
Lord Falconer of Thoroton: It is wrong because it is not good for the public for there not ---
Q494 Mr Stinchcombe: It may be wrong for other reasons. It may be wrong because the public purse is fiddled over a million quid, it may be wrong because company B goes bust and 30 people lose their jobs. It could be wrong for a number of reasons.
Lord Falconer of Thoroton: It is a very wide ambit then.
Q495 Mr Stinchcombe: It would possibly be a wide ambit. What it would do if that was, for example, the kind of definition is enable a jury on hearing the evidence that this particular private deal was done with adverse consequences for the public purse to come to a conclusion whether or not they thought that advantage had been conferred corruptly.
Lord Falconer of Thoroton: No, because the way you put it just then all of the weight falls on the word "wrongly".
Q496 Mr Stinchcombe: Indeed. They would have to ask themselves whether they thought it was right or wrong and that is surely exactly what this kind of Bill should require a jury to ask itself.
Lord Falconer of Thoroton: If two employees of a company agree that one of them will not apply for a particular promotion that has come up in exchange for the other person agreeing if he does not get the job then the person who has not applied can apply for the next one, is that "wrongly"?
Q497 Mr Stinchcombe: I would not have thought so but that would be exactly the kind of question that you could, if you are a prosecutor, ask yourself and then if you were satisfied to the relevant thresholds that it was worthy of taking to prosecution, put the evidence before the jury and see what conclusion they reach.
Lord Falconer of Thoroton: Obviously we will think about what you have said. It feels much too wide and it feels like you would not be getting the benefit in those circumstances of a real definition.
Chairman: There are perhaps even other concepts of "corruptly" which could have been looked at or included.
Q498 Lord Waddington: I am sure you are aware that a number of people who have given evidence before us have asserted that in their view the definition of "corruption" in the draft Bill, far from being clear is obscure. One witness, a Mr Staple, who was the Director of the Serious Fraud Office, demonstrated how, in fact, the Bill criminalises conduct which clearly should not be criminalised. For instance, the payment of a motorway toll to a private contractor operating the toll on behalf of government would be a criminal under this Bill, the person who paid the toll would be a criminal and the person who received the toll would be a criminal. He demonstrated that by the fact that a clause 6 exemption does not apply because the motorist is not acting on behalf of the agent's principal and a clause 7 exemption does not apply where the agent is performing functions for the public. There is something seriously wrong with the Bill, surely, if that sort of bizarre result can follow. Surely there is an easy way out of this if you could only import into the Bill some element of lack of integrity, moral turpitude, breach of duty, improper advantage, as is suggested by the OECD and is a part of the OECD Convention, the EC Convention and the Council of Europe Convention. Surely if some sort of element of that nature was imported we would not have the bizarre result which has been identified by Mr Staple.
Lord Falconer of Thoroton: You have got me on that. I had not picked up this road toll example. Can I deal with it in writing?
Lord Waddington: He has demonstrated it fairly well. Can I just spell it out so that there is no mistake? What he says is that a motorist makes a payment in respect of a motorway toll to a private sector operator who has been given the right to collect the toll under a PFI/PPP contract with the Government. The operator is clearly acting as an agent. He is clearly performing a public function. The motorist confers an advantage, a payment, on the operator who, in return for that advantage, does an act informing his functions, ie, he allows the motorist to go on the motorway, and, as I say, the Clause 6 exception cannot apply and neither can the Clause 7 exception. There is something pretty phoney about a Bill which produces that result.
The Committee suspended from 4.55 pm to 5.05 pm for a division in the House of Commons
Q499 Chairman: Minister, would you like to comment on the toll?
Lord Falconer of Thoroton: Yes, I would. As I understand the example, the private contractor runs the road and therefore takes the toll. On the working of the Bill we believe the effect of that would be that he would just be acting in a private capacity.
Q500 Lord Waddington: He clearly is not, you see, because if he is only operating the toll under a contract with the Government he is acting for the Government.
Lord Falconer of Thoroton: No. He is just doing a business for the Government. Suppose a private contractor rented property from the Government and paid rent and then charged entrance to the people who came into that property. Would that remotely be described as running it for the Government? No, it would not.
Q501 Lord Waddington: He has been asked by the Government to operate the toll for the Government.
Lord Falconer of Thoroton: But a contract has been entered into in which the contractor operates in a private capacity. That is what it amounts to.
Lord Waddington: I can only say that others seek to differ.
Q502 Lord Carlisle of Bucklow: Can I come back to this definition? I fully accept that it is extremely difficult to find a definition for corruption, partly because it covers such an enormously wide area, but we have had Professor Pieth who suggested that they are getting round this with the European Convention by talking about "undue" acts and "undue" awards. He said that that was one in which a person knew they were not entitled and that that was an adequate word to cover it. The other point which occurs to me is this. Looking at the wide field of what could be said to be corrupt or dishonest intent in business behaviour, for example, in corporate hospitality, etc, can you imagine any corruption offences being brought under this Act which did not in fact involve a dishonest intent in the giving and taking of the award and, if so, is it worth putting them in?
Lord Falconer of Thoroton: On the first question, namely, undue payment, that is, I think, the concept that has been suggested, the OECD's approach to our law has been as follows. Last year the Working Group looked at our law and concluded that it broadly complied with their approach. They said it was satisfactory. That was before the changes. Our view is that we are not really effecting significant changes in the law; we are codifying and clarifying, so the Working Group as opposed to Professor Pieth have said that our law is okay. As far as the concept of undue payment is concerned, as I have said, our approach is to focus on breaching a trust, which is quite similar to what Lord Waddington suggested as a possibility, breach of duty of some sort, and we are trying to identify what that duty is. If you go for the undue payment concept you end up with considerable difficulties of the sort that Paul's example and other examples give. It just pushes the question to another place.
Q503 Chairman: But if you use the word "unduly" as an adverb it makes it even more uncertain, does it not?
Lord Falconer of Thoroton: It does.
Q504 Chairman: For instance, a sum of money received unduly?
Lord Falconer of Thoroton: Yes. Just taking up Lord Carlisle's point and your point, does that mean where somebody significantly overcharges me, the owner of my house, for surveying my property that could be corrupt? That is not the essence, I think. Freedom of contract we have to respect to some extent.
Q505 Lord Carlisle of Bucklow: What do you say about the second point? Can you imagine offences of corruption being prosecuted which do not in fact involve an element of dishonest intent by both parties involved, because that is one possible way to look at it?
Lord Falconer of Thoroton: We think that dishonesty is a different concept from corruption.
Q506 Chairman: I agree with that but the question for us, I think, is this: is dishonesty an element of corruption? Can you be corrupt without being dishonest?
Lord Falconer of Thoroton: What happens where two companies offer the same tender price and one throws in a benefit on top for an employee of the company? Is that dishonest?
Q507 Lord Carlisle of Bucklow: Probably, depending on the size of the benefit and everything else.
Lord Falconer of Thoroton: It might be the same.
Q508 Lord Waddington: It is certainly improper.
Lord Falconer of Thoroton: Yes, I agree.
Q509 Lord Waddington: And it is certainly a breach of duty and, although people may criticise the word"undue" and say it is very vague, there is nothing about acting in breach of duty or acting dishonestly or acting with a lack of integrity with which any jury would find difficulty at all, is there? Is there any difficulty at all in any of those concepts?
Lord Falconer of Thoroton: No, but the way that we have sought to deal with it is to say, was it because of the offer of free drinks for life that the licensing official granted the briber his licence? That is the question that our Bill poses for the jury. Your proposal would be, was the offer of drinks undue? Was the offer of drinks lacking in integrity? Both of those formulations, with the greatest respect, open up the thing completely in a way that provides no certainty.
Q510 Lord Carlisle of Bucklow: Is it done with dishonest intent?
Lord Falconer of Thoroton: Is it?
Q511 Lord Carlisle of Bucklow: I do not know. I am asking you if that is a simpler way to deal with it.
Chairman: Let us take another practical example and test it with that.
Q512 Vera Baird: This is a very homely example for you, nothing to do with football either. At the moment "corrupt" is defined in the Bill by reference really to the primary intention of the act as a whole in regard to the discharge of duty of the principal. Supposing A, the buyer, is bought lunch which cost £25 by B representing the company before a contract, his primary intention being to influence A to give him the contract. On the other hand, as before but A is not hungry, so B gives him £25 instead. One would guess that a jury now would say that probably B is corrupt in giving the £25 but A is not. Are you intending to change that? That would be perhaps that because of the nature of the advantage that it would look more corrupt. This would be more likely to make both of them corrupt, would it not? Is that good or not?
Lord Falconer of Thoroton: The example is quite difficult because lunch costing £25 as it were between two great arms manufacturers presumably is not remotely going to affect what happens. Lunch for £25 where the job is deciding what stationery is purchased might have more effect, as would the payment of £25. It is impossible to answer the question without knowing more about the facts, it seems to me.
Q513 Chairman: Does it depend on the intention or on the effect?
Lord Falconer of Thoroton: The intention was to get somebody to do something and the belief has got to be that as a result of either buying lunch, in Vera's example, or giving the £25, the person sought to be bribed then would do something he or she would not otherwise do. I have given a rather muddled answer to that. Does it make a difference that it is £25 rather than lunch? In certain circumstances the fact that it was cash would make it look a lot more obvious, but that is the law now. That goes to intention and belief, does it not?
Q514 Vera Baird: Do you see that the position as to which of those is corrupt is going to alter under the new Bill?
Lord Falconer of Thoroton: No.
Q515 Vera Baird: It is going to stay the same?
Lord Falconer of Thoroton: I think it would stay the same because in seeking to ascertain what the defendant's intention was obviously it would depend upon the facts but in reality you would be much more readily able in most circumstances to explain why you bought somebody lunch as opposed to why you gave somebody £25 in cash.
Q516 Vera Baird: It is more easily hidden perhaps. You might press that point and say, I suppose, that by defining it with reference to the intention you are taking away some of the potential contentiousness of the definition of corruption because if you say to the jury, "Look at the intention; do not look at whether it is lunch, which you might think is more natural, or money which is not", you will get perhaps different views on whether lunch was corrupt or not, whereas if you look at the intention would you say it is a surer test?
Lord Falconer of Thoroton: You have got to look at the intention now. There could not be any way you could frame the law without referring to intention in some shape or form. People give various sorts of hospitality in the course of business. What is their intention in doing it? Obviously, it is to get a good relationship with their potential clients but not necessarily to make them make their decisions primarily based upon lunch at Wimbledon rather than the merits of a particular deal.
Q517 Lord Carlisle of Bucklow: And not necessarily to make an act dishonestly.
Lord Falconer of Thoroton: Exactly. However, taking up Vera's example, I do not know how much lunch and two tickets at Wimbledon might cost, but suppose that cost £350, to hand over £350 in an envelope, however you framed the law, is going to be a lot more suspicious than inviting somebody to lunch at some great sporting occasion.
Q518 Chairman: Although the intention might be the same as the other example which you gave; the effect might be the same.
Lord Falconer of Thoroton: This is not a legal problem. The factual point is, could you think of an explanation for giving somebody £350 in a brown envelope?
Q519 Chairman: But all of this shows how important it is that people, and perhaps particularly businessmen, should understand what is not going to be covered by the new Bill.
Lord Falconer of Thoroton: I do not think the position is that businessmen currently believe that giving people cash in brown envelopes is not possibly over the line.
Q520 Chairman: The question that people will be asking is, have you changed the legislation in order to bring in things which were okay before or to exclude things that were banned before?
Lord Falconer of Thoroton: Yes, and I am trying to say that we are trying to make it clear what is caught and what is not.
Q521 Lord Campbell-Savours: George Staples, the former Director of the Serious Fraud Office from 1992 to 1997, said that he had considered whether the proposed definitions would be readily understood by police prosecutors, juries and the public, and that that extending the concept of principal and agents to so many different relationships, particularly that between the public official and the public at large, was likely to cause confusion and uncertainty and might result in a reluctance to prosecute cases, where under the existing law prosecutors would want it to be justified, and then we have comments from the Director of Public Prosecutions who told the Committee that the relationship would be a difficult concept for juries if there were people whose activity straddled the public and private sectors, and then we had evidence from the CBI where they said that according to the new corruption offence it should be clear in scope and capable of being readily understood by all business people. "We consider that the present wording of the draft Bill does not satisfy these tests. We do not understand the proposed distinction between public and private activities and companies will not know into which category some or all of their activities might fall". We have had a stream of evidence given to the Committee by people, all of whom are affected, to say that they simply would not be able to work with or understand this legislation, and yet you say that you have given us a list at the back of questions and answers for jurors and that is sufficient. They say they cannot understand it.
Lord Falconer of Thoroton: Then obviously we have to consider very carefully both what they say and what this Committee says at the end. I am genuinely saying that one is open-minded. Just take George Staples' criticism. What we are saying in the Bill, and we believe we have said it as economically as we can, is that where the public official makes his decision as a public official, primarily on the basis of the benefit bestowed on him rather than the basis of public duty, and that is the intention of the person giving him that benefit, then that is corrupt. I keep coming back to the example of the licensing official: did he do it because of the free drinks or did he do it because it was the right thing to do, having regard to licensing? At the moment, if we have captured that concept, it is not difficult and it is straightforward. George Staples in his document I do not think is saying that that is the wrong concept as far as public officials are concerned. Can we express it better? Can it be made clearer? Is there a concept that the Committee would prefer to have than the one that we are putting forward?
Q522 Lord Campbell-Savours: He says, "I have concluded that the way in which the proposed legislation is drafted will not, without considerable study, be readily understood by any of those groups". All these people are pointing to a different approach. Why can the Department not go back to square one and perhaps reconsider its whole approach?
Lord Falconer of Thoroton: The three approaches are: have a Bill without a definition of "corruptly" and leave it to the good sense of the jury. We think there are problems with that because you do not get clarification and codification. Do the South African model, 23 separate offences. That is certainly not simple. Mr Staples would be bringing in a whole different number of directions if he produced the South African model with all those offences; or, thirdly, do what we have tried to do.
Q523 Lord Waddington: With respect, that is not correct. There is a fourth alternative which we have already canvassed, and that is to define "corruption" in relation to breach of duty, dishonesty, moral turpitude or anything you like, but at least point out when it is doing something wrong. If you do not do that then you land in the absurdity which has already been conceded in this Committee that if I pay a baggage handler at Heathrow ten pounds to try and extract my baggage from the mess of all the other baggage, I will be committing an offence under this Bill and he will be committing an offence.
Lord Falconer of Thoroton: But all if the alternatives that have been put are being put on the basis where you say it should be undue payment or a payment made dishonestly, something like that, that in effect is saying, leave it again to the good sense of the jury.
Q524 Chairman: The question of adding a word like "improperly" or "dishonestly" is one thing. The other question, it seems to me, is also important to try and outline and I would like to put to you again, and that is the retention of the principal/agent concept. One question which has been asked, the answer to which ought to be obvious, is this. Is it corrupt within the meaning of this new Bill if the head of one company gives some money to another to say that he is not to compete in a contract? Would that be corrupt because there is no agent intervening?
Lord Falconer of Thoroton: If the position were that the chief executive, contrary to the interests of his company, was not acting within the ambit of his authority, then he would be the agent. The principal would be his company and his company would be the victim, but if in Paul's example it was plainly a case where both companies took the view that it was in their interests for company B to get five million quid for company A to bid then he would not be.
Chairman: You have to go and there are a couple of things I would like to raise before you do. The Government's approach to other offences is obviously something with which we have been concerned.
Q525 Mr Stinchcombe: Certain people have suggested that we ought to re-insert "trading influence" as an offence. I just wonder whether it is not there because you believe it should not be there or it is not there because you believe it is already covered by Clauses 1, 2 or 3.
Lord Falconer of Thoroton: We believe it would be caught by 1, 2 or 3.
Q526 Lord Bernstein of Craigweil: The CBI were concerned that small facilitation payments which they make in the course of business, particularly overseas, would be caught by this Act. They quoted an example, I think, of the United States where there is an exemption for certain small payments, and they ask that, if it is not going into the Bill will the Government, during the course of parliamentary proceedings, give some guide on what they regard as proper in these circumstances?
Lord Falconer of Thoroton: When the 2001 Anti-Terrorism Crime and Security Bill was going through, which has the extra-territorial bits of this Bill, we in effect gave an indication that small facilitation payments extracted by foreign officials in countries where this is normal practice would not of themselves give rise to a prosecution in the United Kingdom and we would be happy, when this Bill, in whatever form it comes, was going through Parliament again, to give a similar assurance.
Q527 Lord Carlisle of Bucklow: That means there must be some sieve.
Lord Falconer of Thoroton: Yes.
Q528 Lord Carlisle of Bucklow: Whether it is the Attorney General or the DPP because otherwise the assurance cannot be guaranteed, can it?
Lord Falconer of Thoroton: Having given that assurance, if the prosecution applies on intent, as it does at the moment, to the Attorney General, then he would be able to measure that against the assurances being given in Parliament.
Q529 Lord Carlisle of Bucklow: It makes the case for an incentive.
Lord Falconer of Thoroton: I agree.
Q530 Mr Stinchcombe: You have indicated, and I think you must be right, that there is no lacuna in this Bill through the absence of trading influence, but the Bill does not cover, does it, misuse of public office?
Lord Falconer of Thoroton: If you are misusing your public office in, for example, giving licences in exchange for free drinks, that would be covered. I am not quite sure what would be misuse. If you are a very bad public official simply delivering a poor service -----
Q531 Mr Stinchcombe: I will give you an example. We have mentioned planning gain before. Say a developer proposed a thousand houses in the green belt, which is ordinarily contrary to planning policy, but he offers the council a very disproportionate public planning gain as a very nice sweetener, for example, a new sports centre, it would be improper ordinarily, applying proper planning principles, for that planning permission to be granted, subject to any section 106 obligation, would that be misusing the public office if either the Council or the relevant officer is persuaded to grant planning permission notwithstanding?
Lord Falconer of Thoroton: You would have to look at the facts, but if it was a genuine exercise by the planning officer of what he bona fide believes is in the interests of the public, ie, "I have got to balance the amount of planning gain I am getting against other planning considerations", and he decides in the interests of the public that, even though it might infringe this or that planning policy, getting this huge benefit, a new road, a new playground, a new swimming pool, nevertheless means that the balance there is in favour of the public, that would not be -----
Q532 Mr Stinchcombe: If it were completely on offer as a matter of planning circumstances I could say as a former planning barrister that in those circumstances it would not be judicially reviewable and would be possible, but the question is not as a matter of the public law whether those sanctions exist. The question is whether as a matter of criminal law there should be a prohibition against the temptation improperly to exercise public functions in the discharge of your statutory powers or duties.
Lord Falconer of Thoroton: In the example given assume that the facts are that the planning officer, whatever the planning considerations, bona fide believes it is in the interests of the community, even though subsequently it transpires that it is so off the page in planning terms that it is judicially reviewable. We would not envisage that that was the sort of thing that one would envisage as being corrupt.
Q533 Baroness Scott of Needham Market: We said we would return to this question and it is really about the agent/principal again. Looking at Clause 7, in which the consent of the principal is a defence to a charge under the Bill, so let us say, for example, that person A is a buyer who takes small bribes from suppliers, and their employer is happy with that because the amounts involved are small and it means that he will get away with paying her less and it does not make a lot of difference to anyone, except perhaps that the company to whom the contracts are not placed are significantly disadvantaged and perhaps go bust as a result of that. Under this Bill there would be no corruption offence because A and B are happy with the arrangement.
Lord Falconer of Thoroton: You are absolutely right. That is talking about only the private sector. It is nothing to do with the public. That is the position under this Bill because the essence of the Bill is saying that where you owe a duty to your employer in the example given, if you breach that duty in a corrupt way then you should be prosecuted, but where, in the example given by you, I could take advantage of the fact that my employer gets a bit of a trickle of money from contractors, then there is no breaking of trust in effect. It is an arrangement that suits both parties. To say, "What about those who do not get the contract?", well, there is freedom of contract. The employer knows perfectly well with whom he is placing a contract and on what basis.
Q534 Baroness Scott of Needham Market: That is fine, but you have actually said yourself that corruption worldwide weakens democracies, harms economies and inhibits stable development, etc, so you yourself place quite a lot of emphasis on the level playing field aspect of corruption rather than necessarily breach of trust, so I am just not sure whether what is in the Bill here actually reflects what you have said.
Lord Falconer of Thoroton: I think it does. You have got to strike a balance, have you not, between on the one hand making sure that there is proper transparency in business and not the corrupting of agents, and on the other making sure that you do not unrealistically interfere with the people with whom people can enter into contracts? To extend it to the extent that you are saying would lead to a much wider scope in the corruption law at the present time and that is not what we have in mind in this Bill.
Q535 Baroness Whitaker: Reverting to what Lord Campbell-Savours said about the business community saying that they found it hard to understand, in a way do you not agree that that is more important than the judge and jury being able to understand?
Lord Falconer of Thoroton: I think they are both important.
Q536 Baroness Whitaker: Did you show this draft to representatives of the business community and, if so, what were their comments? The second question is, have you thought of an approved code of practice to flesh out this very self-contained Bill so as to be able to help business?
Lord Falconer of Thoroton: As to the first question, this particular draft I think was first produced at the pre-legislative scrutiny stage in March and was not specifically shown to the CBI before.
Mr Stephenson: That is right. It would be not good practice before we presented it to Parliament to show extracts of the draft outside.
Lord Falconer of Thoroton: But the Law Commission Bill produced in 1998, which is not identical but has similar aspects to it, has been available to the CBI in effect for the last five years.
Q537 Baroness Whitaker: And the approved code of practice?
Lord Falconer of Thoroton: That sounds quite a sensible idea. It seems to us that there might well be real benefits in relation to that.
Q538 Chairman: Minister, thank you. I know you have to get away. We have a number of other matters we were going to raise with you and we will raise them with the Attorney General. If necessary we will write to you and indicate what we would like your views on. If the very worst happens we will ask you if at all possible to come back.
Lord Falconer of Thoroton: If the Committee would wish me to reappear I would be more than happy to do so.
Witness: Lord Goldsmith QC, a Member of the House of Lords, Attorney General, examined.
Q539 Chairman: Attorney General, we are very grateful to you for coming. We have a number of questions that we have not asked the Minister about but we will start with something we have covered a little bit. There are two major criticisms that we have heard from a number of witnesses. The first is that as a matter of drafting it is all much too complicated and particularly Clause 5 of the Bill is going to be difficult for jurors and difficult for lawyers to advise their clients on and virtually incomprehensible to businessmen. That is one suggestion, that we ought to be looking for a much clearer and more precise definition. Lord Falconer has indicated that if we come up with something on the basis of the evidence we have heard and the views of the Committee that was sufficient for purpose in objecting to the Bill he would certainly look at redrafting it. The second thing is that obviously the word "corruptly" in itself has been used and may cause difficulty or it may not, but the suggestion is that in the definition of "corruption" here there is no indication of "dishonestly", "improperly" or, to use the continental word, "unduly", and that perhaps as a matter of definition to stick to the concept of principal and agent is in itself not a very good idea. It is complicated, it may allow some people to escape and perhaps it would be easier, as the Director of Public Prosecutions said, for prosecutors were we to focus on the passing of the bribe rather than on the agent/principal relationship. Those are just three of the main broad topics that you may wish to comment on, and then after that we can go on to specific questions.
Lord Goldsmith: I am happy to try to comment on them. If I may, I want to say that I am very pleased to give whatever assistance I can to the Committee. It is plainly very important, the work the Committee is doing, scrutinising this, and that will be very advantageous. I would emphasise that I am not the Bill Minister. It is not my policy which is here at issue. I hope that I can help the Committee from two perspectives: first of all, as the senior prosecutor responsible for the prosecuting agencies who will have to deal with the Bill I therefore have a real interest in how it will operate in that respect; and I suppose also to some extent as the senior law officer. Obviously, you have been asking Lord Falconer policy questions as to what should and should not be within the ambit of the offence and that is probably not an area I can help you a great deal with.
Q540 Chairman: May I say that we are of course aware that it is not your Bill. The reason I have put the three topics all lumped together is so that you can pick and choose which is more appropriate for you to comment on.
Lord Goldsmith: It is an unusual invitation to have from you.
Q541 Chairman: Lawyers cannot usually resist talking about everything so we may get an answer to all of them.
Lord Goldsmith: I would say this if I may in the hope that it is of some help. The first question seems to me to be, is it helpful to have a new Corruption Bill? Looking at this really from the point of view of a prosecutor, I think there is a strong case for saying it is helpful to have a new Corruption Bill. The existing law is drawn from a multiplicity of sources, some of which derived from decisions made in a position of emergency or urgency at the time. It gives rise to difficulties. There was a recent case, for example, called Nachey, which failed as a prosecution because in the end on quite a fine distinction between who was public and who was not public, it was said that the offence was brought under the wrong Act. That is not satisfactory when the conduct that was being alleged at least was plainly something which ought to have been tested fully by the courts. That it is desirable to have a Corruption Bill I am persuaded of. Secondly, the big issue in relation to the Bill is, does one try to define "corrupt" or "corruptly" at all? I am impressed by what the Law Commission said in relation to that, that, unlike the concept of dishonesty, there does appear to be more variance in the view as to what is "corrupt" and what is "corruptly". There is a difference in judicial thinking. There seem to be two, possibly three, streams of judicial thought as to what is meant by "corrupt" and how you therefore direct juries, and the fact that there was not unanimity of view or anything like it amongst the respondents in the Law Commission's consultation certainly seems to me to give rise to quite a strong case for saying that one ought to attempt to define it. The third question to which that then gives rise is, does this Bill do it? I am interested to hear Lord Falconer also say that the Department want to consider very carefully any suggestions that there are for improvement, including in particularly any to come from this Committee, and I look forward to seeing what they say in relation to that. My principal interest is, is it going to be possible to prosecute whilst the Bill is plainly complicated in certain areas? I actually do not think that with judicial assistance juries will have that much difficulty deciding because they will be directed to what questions they have to deal with. They will not be asked to read the Act and work it out for themselves. That seems to me to be important, although of course I have read what both the Director of the Serious Fraud Office and the Director of Public Prosecutions have written, both of whom are directors for whom I am responsible, and of course it is very important to take account of their concerns as to what might happen if the judicial assistance is not perhaps as good as it should be.
Q542 Chairman: What do you feel about Sir David Calvert-Smith's comment about focusing on the passing of the bribe rather than on the agent/principal relationship?
Lord Goldsmith: I pay the greatest respect to everything that he says. As I understand it, in a sense both are a part of what is intended by the offence. There is the conferring of the advantage, although one has to focus upon what payment, if it is payment (that is going to be in the classic case) has been made or is intended to be made, so there will be a focus on that, but also what are the purposes for which it is provided. What one does not see in the Bill, as it were, spelt out, although it seems to me to be implicit in it, is the concept, in the classic case, of payment being made with an intention or hope that there will be a breach of duty, and so one has two bits of it, the breach of duty and the payment to procure that as a reward for it having been done, which is implicit in the Bill.
Q543 Lord Waddington: I was most interested to hear you use that phrase "breach of duty" because of course one does not find the words "breach of duty" in the Bill. This is really what is worrying us most of all - that the definition in the Bill is not easy certainly for a layman to understand, and both the Law Commission, and, for instance, Mr Wardle of the SFO, said that although, strictly speaking, corruption had never been looked at as an offence of dishonesty, it is extremely difficult to think of cases where there is not an element of dishonesty. If that is so, is it not time we faced the facts and did the commonsense thing and put something in the Bill along the lines that there had to be a breach of duty or there had to be dishonesty or there had to be some moral turpitude? Would there be any difficulty in doing that? It seems to me it would make life a lot easier.
Lord Goldsmith: From the policy point of view the Department would want to be satisfied that what one is left with in the Bill covers the offences that they intend to cover and that is obviously critical from the point of view of prosecuting those offences. However, anything which improves the Bill and makes it easier to apply I would welcome. That is not to say that I think it is unworkable as it stands but I welcome any change there is. Following up Lord Waddington's point particularly in relation to dishonesty, of course the most recent Court of Appeal pronouncement says that dishonesty is not part of the offence of corruption.
Q544 Lord Waddington: Let us go for breach of duty then, would you be happy for that to be added?
Lord Goldsmith: I do not want to be drawn into whether or not that is going to cover all the things that are required. It certainly seems to me, if I may say so, something that is well worth considering by this Committee to consider and it may be for others to consider too, whether that is a key to it. I think it is implicit, as it happens, when one reads the charging section and the exceptions together, and I think that is what binds them together, but perhaps that is the way I am reading it.
Q545 Chairman: Lord Falconer explained to us why the Department decided they would not follow the South African pattern of having very precise charges so that people ought to know more clearly than under the more general statements that we have. He explained that was considered and felt not to be the appropriate way to deal with it.
Lord Goldsmith: Yes, and Sir David Calvert-Smith I think told you that from his point of view he thought it was right, on balance, to go for something which was a global offence rather than trying to enumerate all the possible exceptions. I entirely understand that from a prosecutor's point of view, otherwise you are always being faced with something that does not quite fit into one of the categories which has been set out.
Chairman: Everyone is going to be interested to know whether there is something now in the new offence which was not corruption before or whether something which was corruption before has now dropped out. One thing has clearly changed and that is the position of Members of Parliament. Perhaps we could ask you about that and you may or may not wish to comment on it. Dr Turner would like to pursue this.
Q546 Dr Turner: Clause 12 seeks to set aside parliamentary privilege. Do you think that there is any merit in actually defining parliamentary privilege as was recommended by the Joint Committee on Parliamentary Privilege, so that parliamentarians know when they say things in Parliament they are liable to be used either against them or other parties?
Lord Goldsmith: I am always in favour of as much certainty as one can achieve for everybody so I would not oppose anything which clarified things, from whomsoever it is. As I understand it, this is a Bill dealing with corruption and it is necessary to deal with the question of whether that is going to cover Members of Parliament or people who have something to do with Parliament in certain circumstances and what it is necessary to do to deal with the inadmissibility of things which happen in Parliament in order that those offences can be prosecuted. I think that is all that clause 12 is dealing with, very important though it is, and I can understand that this is not the Bill to go further and pick up the rest of the recommendations which the Joint Committee on Parliamentary Privilege made.
Q547 Dr Turner: Can you think of any occasions in which MPs or peers have escaped prosecution for corruption because of the provisions of Article 9 of the Bill of Rights?
Lord Goldsmith: None of course have been referred to me, I certainly cannot identify any. I can consider hypothetical cases where Article 9 would preclude or at least make more difficult a particular prosecution if those were the circumstances. If the allegation was that a Member of Parliament or a peer had taken a bribe in order to vote a particular way, speak a particular way, ask a particular question, then the presence of Article 9 would cause considerable difficulties in being able to prosecute that as an offence because one would not be able to bring into court the fact that this had actually happened in Parliament.
Q548 Dr Turner: I can remember, we can all I am sure remember, some notorious examples of precisely those things happening in a previous recent Parliament and I think they in fact did not face a prosecution.
Lord Goldsmith: The allegations did not result, if I am thinking of the same ones, in any criminal prosecution. They did result as a consequence of the amendment of the Defamation Act in civil proceedings.
Q549 Dr Turner: So do you think there is any requirement in this Act to set some clear limits on the degree to which parliamentary privilege is defined, or defined in terms so as to understand for what circumstances it will be set aside for the purposes of prosecution. As it stands, it looks fairly sweeping and it has been suggested by some witnesses that it goes too far.
Lord Goldsmith: I am very happy to try to respond to the question as to whether it goes too far. It seems to me relatively clear that where one has the ingredients of an offence which are otherwise made out, and clause 12 does not extend the offence of corruption in any way at all, it provides that no enactment (and that is principally Article 9, it may be exclusively Article 9) will stop you from producing material in the court that proves one of the ingredients of that offence, and that is all it does.
Q550 Lord Campbell-Savours: Can I take you back. I spent 20 years in the House of Commons and I am quite worried about this section. Do you believe that an elected Member of Parliament has an absolute right to speak and be without fear of any pressure or being compromised in any way? Is that your view?
Lord Goldsmith: I strongly believe in the freedom of speech in Parliament which has been an absolutely critical part of our freedoms, showing a spotlight on wrong-doing and ensuring there is a place where these things can be said, certainly.
Q551 Lord Campbell-Savours: Looking at clause 12, can I quote you what the Clerk of the House said. He said: "The strong invitation of the passage is that the recommendation is intended only to relate to offences alleged to have been committed by Members, but, as drafted, clause 12 goes far wider than that. As already mentioned, it would enable evidence given by a person to a select committee to be called in question in court in support of the charge of corruption against that person. If a Member of Parliament had commented in a debate on an individual who was subsequently charged with corruption, the Member's speech would be inadmissible as evidence under clause 12 and" - which is where many of us get very worried - "a Member might be questioned about its meaning and the information on which it was based." So this is what the Clerk of the House of Commons has submitted to the Committee.
Lord Goldsmith: I do not doubt at all that the Clerk has submitted that. My expression of disagreement was over the proposition that because a Member says in the House something about somebody else that that becomes evidence in a court of law. It seems to me it is not evidence at all. If I were to say that X had been corrupt, a police officer might come to me afterwards and say, "I understand you said this in a select committee. Can you tell me why you said that and what evidence you have," and that might lead him to a line of enquiry that might enable him to find other evidence, but he could not call me into court to say, "I think so-and-so is corrupt," that is irrelevant. The first point that was made in what was said seems to me to be important. Clause 12 does go further than simply dealing with a Member, I agree. It would cover a case where somebody comes before a committee such as this or another committee, who perhaps comes forward as an expert to come and tell the Committee that there is no a problem from a particular scientific process, or something of that sort, and has in fact been bribed to say the opposite of the truth. What would happen at the moment would be that the evidence that had been given to the select committee could not be brought into court to prove that this person had been corrupted into giving that false evidence. I would add that it is obviously a policy matter but I think you can argue very strongly that freedom of speech is actually enhanced by having a limited exception so that you can be satisfied that people who are speaking are speaking from the heart, honestly and genuinely, and not speaking because they have been paid secretly by some interested party to do so. That is a policy issue.
Q552 Lord Campbell-Savours: But if a Member of Parliament has in mind when he or she speaks in the Chamber that words that he or she may use may be taken down and then be the basis on which they as Members, unconnected with a criminal offence, are used and they may be required to go into court and give the basis on which they made those statements in the House of Commons, surely, a Member with that in mind might decide, "I am not going to say anything at all," and in doing so their privilege has been restricted? I can think of the circumstances where in a particular case - because I often raised issues under privilege in a former incarnation - I would have had second thoughts about raising the issue in the Chamber for fear that I may subsequently become involved in protracted proceedings in the event that I did not have the full defence offered by Article 9, which to some extent is being eroded in those proposals.
Lord Goldsmith: I do not want to pry at all but was the concern that you had that somebody might try and pursue defamation proceedings against you?
Q553 Lord Campbell-Savours: No, just that I would not have wanted to have been wrapped up in the case in court.
Lord Goldsmith: It is always dangerous to make sweeping statements without having considered every single circumstance and I would be very happy to consider them, but I do not see at the moment why a Member who is not himself or herself involved in a corrupt activity, by saying something in the House about it, unless that person is prepared to voluntarily be so, would be summoned into court in order to explain what has been said because a statement by somebody that X has been believed to be corrupt simply would not be evidence that could be used against them.
Q554 Vera Baird: I was just going to pick up on what you said earlier about the availability of something said by a Member of Parliament to a police officer who might wish to investigate whether the Member of Parliament was prepared to make a statement about the issue outside Parliament or give him further leads. There is nothing to stop that from happening now, is there, even with parliamentary privilege intact, save for the Defamation Act?
Lord Goldsmith: That is absolutely right, nothing at all.
Q555 Vera Baird: If I may ask one further point. Granted that consideration for parliamentary privilege is waived in any way, they are unusual decisions for an ordinary prosecutor, as it were, to take, because factors come into the decision making process which are not really applicable anywhere else. Would there be anything to be said for having a filter rather than a carte blanche so that if a police officer thinking of investigating something needs to look into something said in the House of Commons, then automatically there is no privilege to stop it? Would there be any point in having a filter? I am thinking of the model of the application for a fresh trial in double jeopardy proceedings, which requires an application to you, first of all, to support that carrying on. Do you see any room for a filter of that kind to protect from the dangers Lord Campbell-Savours sees very clearly?
Lord Goldsmith: As the Bill is drafted there is just such a filter because as the Bill is drafted no case for corruption could be brought without my consent.
Q556 Chairman: Sir William MacKay told us of a distinction drawn in the United States which in its way is also a filter. The only matters which could be raised in the courts would be cases where something had been said which went to the making of the agreement to do something, the word used was compact, but the actual performance of the agreement which might involve something said or something done connected with parliamentary proceedings would not be within the jurisdiction of the court. The actual agreement to do it is distinct from the actual doing and would that not give, as the Americans have done, a form of protection which might be considered here? Have you considered this yourself? It is a case called Brewster.
Lord Goldsmith: I read the memorandum and I found it very interesting to read. It seemed to me - and not having read on the other hand the underlying United States jurisprudence I may have got this wrong - in a sense they were not differing that much from what clause 12 is saying in concept, this sense which they have interpreted in their equivalent of Article 9 by saying, "Well, you do not impeach or question proceedings" - using the language of Article 9 - "if what you are doing is not bringing those proceedings into question themselves but relying upon them to prove that an unlawful act has taken place. It is possible that our courts themselves might interpret Article 9 in that way. There is a case which is presently being considered by the Judicial Committee of the House of Lords which may assist in what the full ambit of Article 9. It is a different context, saying not that the things which happen in Parliament are themselves for some reason unlawful but there shall be no reason not to rely upon what happens as evidence if otherwise it is evidence in support of an offence. Otherwise it is not far from that concept.
Chairman: It is not entirely clear how it would work in some situations, this distinction between compact and performance.
Q557 Lord Campbell-Savours: I want to finish my final question. It is just that when I said that the Member might be questioned about its meaning and the information on which it was based, I meant in the courts. Are you saying that would not happen?
Lord Goldsmith: I am finding it very hard to see ---
Q558 Lord Campbell-Savours: That is not what I am asking you, because that is what MPs will want to know.
Lord Goldsmith: I am saying I am finding it very hard to see how it will happen if in the example you are giving what the MP is saying is, "I am now reporting something about which I have learnt or heard," because that is hearsay, that is opinion, it is not direct evidence of an offence having been committed.
Q559 Lord Campbell-Savours: Are you aware of the case before the Health Services Select Committee at the moment that they are wrestling with?
Lord Goldsmith: Which case is that?
Q560 Lord Campbell-Savours: The Health Services Select Committee in the House of Commons.
Lord Goldsmith: I cannot tell whether we are thinking of the same case. I am aware of a case where an issue has arisen about whether or not it is possible in a criminal prosecution to rely upon something that was said by a non parliamentarian to a select committee. Have I got the right issue?
Q561 Lord Campbell-Savours: Yes.
Lord Goldsmith: But that is a circumstance in which it is the fact that that person said it which is relevant to whether or not the company with which that person is connected is guilty of a criminal offence.
Q562 Mr McDougall: On clause 12 as well could I quote you the Clerk of the House when he made mention of the fact that the fundamental requirement for a successful prosecution of the proposed new criminal offence of corruption will be clear evidence of the existence of a corrupt bargain and that clause 12 will not materially assist the prosecution in meeting that requirement. Three brief questions. First of all, is clause 12 as it stands really necessary?
Lord Goldsmith: I think there could be cases where without clause 12 it would not be possible to bring a prosecution because evidence of a key ingredient of the offence would not otherwise be available, so my answer must be yes, it is necessary.
Q563 Chairman: Have there been any recent cases of that kind as far as you are aware, without giving us names or details?
Lord Goldsmith: No, there is the case to which Lord Campbell-Savours is referring which is not quite the same where there may be some implications from the unavailability.
Q564 Mr McDougall: Have you known of any examples at all of circumstances where a Member had been involved in corruption but the only evidence available to prosecute him or her came from parliamentary proceedings?
Lord Goldsmith: If the circumstances were that all that one knew was that the allegation was of a statement which was made in Parliament which was thought to have been made as a result of corrupt inducement, as the law stands at the moment one simply would not go any further to investigate it because the fundamental aspect of it would not be provable in court because of Article 9. The answer is I do not know of any such cases but I am not sure that demonstrates that there might not have been any.
Q565 Mr McDougall: Has there been any narrowing down confining clause 12 to, for example, cases where Members have been bribed, to make it much more specific? Would there be any advantage in doing that?
Lord Goldsmith: I think the disadvantage of doing so, if I may say so - and these are policy questions rather than questions as to what one wants to cover - is it would cut out, for example, the case of the corrupt so-called expert witness giving evidence to a select committee because one could not then get that material in, and I would have thought that one would in principle want to be able to catch that sort of conduct because giving corrupt, false evidence to a parliamentary committee seems to me to be a very grave thing to do.
Q566 Mr Shepherd: I was very impressed with your ringing endorsement of the Bill of Rights and that you expected a Member of Parliament to speak freely, honestly, according to belief, et cetera, but of course much of parliamentary life is dependent upon a system of deals and bargains and agreements as part of the oil that enables it to function. It has been put by one of the Clerks in a paper to us, and I will take a big example, a government which is a minority government is returned and it has to enter into a coalition. In order to do that there is a conflict naturally of what a number of Members of Parliament who might form this government believe in honestly, passionately, etcetera. The inducement is that they become part of the government of the country or - and I say this with diffidence - one of them may be offered Bermuda in return for voting in a certain way. As the Bill is drafted now that seems to have all your agents A, B and C performing and acting. Does it not meet the way corruption is established in this Bill? Would it not be a corrupt pact?
Lord Goldsmith: I need to think a little bit further about the detail of how the Act operates but it does occur to me to say that I had understood not that the example you have given was the reason for it but that circumstances which related to the way that Parliament operates were one of the reasons that the Joint Committee on Parliamentary Privilege thought that some sort of filter was appropriate, a filter which had some understanding of the way that Parliament operated and could therefore perhaps distinguish.
Q567 Mr Shepherd: It is just I am seeking clarification on this because it goes right through the parliamentary processes, as you know perfectly well. In inducing people to vote for something, sometimes offers are made by those in a position to make offers. I am not saying it is the biggest and single most important issue but it is important. It is now mooted that we should have a European prosecutor. What would his role be in this? Does that do away with you as a filter?
Lord Goldsmith: I am firmly against the European public prosecutor and that is one of the reasons for it because I think it is very desirable that our Prosecution Service ultimately has an accountability to Parliament through the Attorney General. I think that having a European public prosecutor which side-stepped that would give rise to a lack of accountability and disruption of the system that we have, with disadvantage. That is one of the reasons I am against that.
Q568 Mr Shepherd: It would undoubtedly have an effect if it comes in. If the government comes in it may change its mind. I accept it is a draft proposal as well but surely this intervenes directly in the operation of the British judicial process (because many of the transactions in this Bill are trans-national that you are trying to strike at) and that would give them a direct role in the British judicial process, would it not?
Lord Goldsmith: If I can, I will focus on this particular Bill. That depends in what form it is remained. If, for example, the Act remained requires that before certain prosecutions could be brought by Act of Parliament there be consent from whether it is the Attorney General or anyone else, that would remain a condition of the offence. Whether or not there was a European public prosecutor whose job it was to look at intra-Community---
Q569 Chairman: Many of the sort events we have been considering in the corruption context would not appear to fall within the proposal of a European prosecutor. Could we stick with clause 12 for the moment. The question has been raised as to whether it is right to limit clause 12 to corruption. There are other offences which perhaps should also fall within the same heading, fraud for example you mention. Do you have a view as to whether we should extend this removal of the privilege to cover fraud as well as corruption?
Lord Goldsmith: To do so would from a prosecutor's point of view, from my point of view as prosecutor, be helpful because it could mean that evidence which was relevant to prosecuting a particular offence would be available when at the moment it is not. But I think one would have to balance that as a policy matter against how far one wanted to make incursions into the privilege, and I think broadly there is a balance that one has to strike on the one hand between leaving the fundamentals of freedom for parliamentarians to speak intact whilst making necessary incursions into that which are consistent with that freedom of speech, and I have suggested that actually having sanctions against Members who spoke for corrupt purposes, if such a thing were ever to happen, enhances the quality and the nature of freedom of speech in Parliament.
Chairman: You would like to follow this up?
Q570 Mr Stinchcombe: Just one very short question. You have suggested that clause 12 would be necessary in order to prosecute, for example, a Member of Parliament who took a payment in order to vote in a particular way. However, on my reading of the relevant clauses you would not have to prove that the Member of Parliament voted in order for the offence of corruptly obtaining an advantage to be made out and neither would you have to prove that he had voted in order for the briber to be convicted of the offence of corruptly procuring an advantage.
Lord Goldsmith: I think there are two answers there. You might not have to if there is a case where you were alleging it happened in advance, but in practical terms if you could not actually put before the jury what happened, the prospect of getting a conviction could be significantly weakened and up in the air, so what happens about this. You are saying he patently denies he was paid. He says that anything he received was a contribution towards this or that or the other. As a prosecutor you want to tie that into what actually happened. The second answer is that the Bill also covers those circumstances where something has been done in advance in expectation of something happening afterwards and then it would be rather more necessary to demonstrate that the step had been taken. I am thinking of 5(2), if I have got this right.
Chairman: You mentioned your role, let's just have a look penultimately at that. What is the role of the Attorney General?
Lord Waddington: If the consent to prosecutions for corruption were vested in the DPP instead of the Attorney General, which has been suggested by some people, the argument against it was that the responsibility of the DPP could be delegated right down the chain until in fact some people might think it was not an appropriate filter at all. Is there some sort of halfway house whereby if the consent was vested in the DPP it would be possible to ensure that that consent was given at the highest possible level.
Q571 Chairman: Can I just add a rider to that. One of the suggestions was that it should be the Crown Prosecution Service which would have the right to look at this and decide. I think if it is made the Director personally that is one thing, if it is the Crown Prosecution Service then there is really quite a serious problem that arises. Do you have a view on that?
Lord Goldsmith: Certainly. Lord Waddington is of course right that at the moment, and there are many examples of DPP consents, as there are many examples of Attorney General consent, a DPP consent can be exercised by any prosecutor because there is a delegation down. It would be perfectly possible to provide in certain offences that the consent should not be exercised below a particular level of lawyer and indeed as internal matters of management of course the Crown Prosecution Service does do that, and certain very serious matters will not be determined at a lower level. I would be concerned about something that required the DPP personally to consent because then there would be questions of demand on his - and we have to appoint a successor or perhaps her time.
Q572 Baroness Whitaker: How about if the Director of the Serious Fraud Office who had the consent rather than the DPP, again at the appropriate level?
Lord Goldsmith: There will be some corruption cases which will fall within what the Serious Fraud Office does, certainly.
Q573 Baroness Whitaker: Exactly.
Lord Goldsmith: There will be others that do not.
Q574 Baroness Whitaker: If his mandate were enlarged to make it appropriate for the whole of the scope of the Bill?
Lord Goldsmith: I would have some questions about that. The Serious Fraud Office is a very important and skilled organisation dealing with complex and serious fraud which often does involve corruption, these two things do quite frequently go together, but I would have some questions about whether or not the office should be involved, for example, in the sort of I do not know how to describe this, pedestrian corruption which does take place, somebody slipping a backhander to the buying manager of a small company in order to sell particular goods to that company. I am not sure I would want the Serious Fraud Office to be taken up dealing with that, that is a question of resources.
Q575 Lord Carlisle of Bucklow: Going to your point and for a moment accepting that, in fact, dishonesty is not a necessary element in the crime of corruption, nevertheless can you ever envisage yourself or have you ever given your consent to a prosecution in a case of corruption where there has not clearly been a dishonest intent?
Lord Goldsmith: I cannot immediately recall ---
Q576 Lord Carlisle of Bucklow: Can you imagine any?
Lord Goldsmith: I cannot immediately recall one, that is right, and the most common case that one gets is where you have probably got the corruption mixed up with a conspiracy to defraud, to pretend that the bid is the lowest bid or to put in other false bids to make it look a satisfactory bid, something of that sort. I can envisage circumstances in which one would question whether there is dishonesty in, for example, something which is being done which the agent would have done in any event. One might say that is still corrupt, it may still be corrupt because you pay someone in the expectation that they will primarily be motivated by that, but in fact, they do not damage the principle at all in what they are doing.
Q577 Lord Carlisle of Bucklow: Would you envisage giving your consent in those circumstances to a prosecution?
Lord Goldsmith: I am reluctant to speculate on all circumstances.
Q578 Lord Carlisle of Bucklow: I realise that.
Lord Goldsmith: I have indicated already that if one is searching for something I think the concept of breach of duty is a more profitable one that dishonesty per se.
Q579 Lord Carlisle of Bucklow: Certainly it would get rid of the whole problem of small compliance payments and corporate hospitality and things of that nature.
Lord Goldsmith: I think the Bill does that in any event because of the requirement that something should be primarily in return for conferring an advantage. I am thinking also of the question Mr Shepherd put to me of what somebody does in a coalition government. If somebody in a coalition government is voting with government primarily because of the advantage that has been promised, I strongly suspect the answer to that is no. It is because the person believes, at least for the time being, it is better to support that government than otherwise but in the example of corporate hospitality I would think the chances of demonstrating that somebody was accepting a major contract primarily in return for a lunch is unlikely.
Lord Carlisle of Bucklow: It may be a bit more than a lunch.
Q580 Lord Campbell-Savours: If the DPP, him or herself, was the filter, would it be in order for him or her to consult with the Commission for Standards and Privileges?
Lord Goldsmith: I would have to consider that.
Q581 Lord Campbell-Savours: Could you let us know?
Lord Goldsmith: Certainly.
Q582 Lord Campbell-Savours: The Clerk of the House referred to the enactment of section 30 of the Defamation Act of 1996, which he described as "a serious encroachment on the principles underlying the Bill of Rights". Do you think it should go?
Lord Goldsmith: I really do think that is outside my remit, if I may say so. That was passed, as we all know, in particular circumstances.
Q583 Lord Campbell-Savours: Mr Hamilton relied on it.
Lord Goldsmith: It did not do Mr Hamilton any good in the end.
Q584 Lord Campbell-Savours: Do you think it should go?
Lord Goldsmith: As it happens, I do not particularly think that it should go. I think that the circumstances in which someone who believes that he has been defamed by a newspaper and is precluded from clearing his name because of a rule which prevented reliance upon what had taken place in Parliament is capable of causing injustice, and that is obviously what Parliament thought because it passed section 13 and it believed that was an injustice. I share that view but that is entirely a policy question.
Q585 Vera Baird: I am sorry if my question has been asked. Part of the purpose, as I understood it that clause 17 required your consent as the Attorney General, I had thought was in relation to proceedings against a Member of Parliament which were intended to be non-delegable on the basis that these strange factors which an ordinary prosecutor would not understand about parliamentary organisation you would know about as a parliamentarian and I had thought that that was primarily why the consent was to be you and not delegated. Do you have any comment on that? Is that a good thing or is it a bad thing, because you are, after all, part of government and might be seen internationally to make decisions on a partisan basis, although of course you never would?
Lord Goldsmith: I am personally quite relaxed about who the consent should be from. I think there are two questions. One is should there be a filter at all. I think a compelling case was made out that because the nature of the allegation that was made was potentially very, very serious, particularly to people in public life, the damage could be irreparable, it is perfectly true that both the Director of Public Prosecutions and I are capable of stopping prosecutions but it takes time to get to that point and the damage may have been done, particularly if an allegation or private prosecution were brought perhaps at the time of an election or something of that sort. The first question is should there be any filter at all? I think a compelling case has been made. Who should provide that consent? At the moment there are a variety of Acts which are not at all consistent as to whether it is an Attorney General consent and when it is a DPP consent. It seems to depend to some extent on what the feeling was at the particular time the Act was passed. The argument in favour of it being the Attorney General rather than the DPP, which came from the Nicholls Committee, was precisely the point that you made, that the Attorney General would be able to bring parliamentary knowledge and experience to the decision and also the question of the delegation down to a lower prosecutor than the DPP. The argument against it, and the only point I feel very strongly about, is I do not mind which it is so long as there is no suggestion that the reason, if it be not the Attorney General is because the Attorney-General cannot be trusted to exercise this. I know that successive Attorney Generals have felt - and I do - very, very strongly when it comes to making prosecuting decisions and public interest interests that we are not acting as part of the government. Collective responsibility is not a part of it.
Q586 Chairman: I want to know whether this suggestion is practicable. Should the Attorney General take a decision that he should move the Commons without a debate but leave would be given so there would be some parliamentary control of it? Do you think that is practicable? We would have to put it in Standing Orders of course.
Lord Goldsmith: It seems very difficult.
Q587 Chairman: It seems to me it would raise a lot of difficulties. I would like to know whether you think it would be practicable to do it in that way.
Lord Goldsmith: Two practical problems spring to mind immediately. I have not given this any more thought than just sitting here now. First of all, this would require the law to be changed so that clause 12 was in place but subject to a resolution of the House. That potentially it seems to me could be argued to do more damage to freedom of speech than good because it would be holding a "sword of Damocles" over the head of particular Members, either those with unpopular views or those from minority parties. That could be potentially a very worrying sign. The second practical problem is if I am moving a resolution in the House, presumably the House would want to know what the evidence is upon which the charge is based.
Chairman: That is where the practicality really hits it.
Q588 Vera Baird: Could I follow up very briefly. This is something I genuinely do not know. You drew a distinction, I think, in part of your last answer between the stage of prosecution and the stage of investigation and made clear that in terms of a person in public office the mere investigation can be very damaging indeed. Is your consent usually sought at the outset of an investigation so that you would have some filtering influence over that or do you become involved much later in the day?
Lord Goldsmith: I expressed myself badly. I should have made it clear that it is the fact of starting the prosecution that would do the damage. If there is no filter it would be open to someone to go to a magistrate and start a prosecution then and there.
Q589 Chairman: Which happens in some states of the United States we are told where there is no filter.
Lord Goldsmith: No, my consent would not be sought until the end of the process, not at the beginning.
Q590 Vera Baird: So there would not be any filter on the investigation and the potential danger that that would offer to your public figure, as you say, particularly at election time or at a time of a reshuffle?
Lord Goldberg: I think that the danger is much more of this being published For a police officer to interview somebody does not do the same damage at all as a statement that someone being prosecuted and is appearing in such and such a Magistrates Court tomorrow.
Q591 Vera Baird: Say if a Parliamentarian is arrested?
Lord Goldberg: One would want to move fairly quickly to resolve that.
Q592 Mr Stinchcombe: Can I take you back to the suggestion that you have now twice floated, that the moral turpitude you had in mind might be embraced by some concept of a breach of duty and whether that would be sufficient? If I take the example of an office holder in a local authority, that person's functions would be embraced by powers and duties, discretions and duties, should we be happy just to have the breach of duty covered by a definition of corruption or should we look to the person who is influenced to exercise a discretion in a way which he might not have otherwise exercised a discretion?
Lord Goldberg: I was simply saying that of the variety of potential changes that there could be it seemed to me that the breach of duty was one that was worth looking at. I have certainly not attempted to draft or re-draft the Bill or anything of the sort. Secondly, no, I do not think there is a problem because a breach of duty encompasses somebody using a power or a discretion that they have been given inconsistently in a way in which they are supposed to exercise it.
Q593 Chairman: Are there any other questions on the parliamentary scene while we are on it? Unless there is anything that you would like to say about something we have not covered I would like to finish with one matter which was raised very recently, that is the exception provided by clauses 15 and 16 about the intelligence services. I have two questions: One, is it necessary to have such an Article and is it a sufficient provision to prevent abuse? Secondly, perhaps in a way more important, have you considered whether to adopt clauses 15 and 16 would be contrary to our obligations under the OECD Convention and under the Council of Europe's Criminal Law Convention? Firstly, do we practically need clauses 15 and 16? Secondly, if we adopted it would it be contrary to the OECD Convention and the Council of Europe Convention?
Lord Goldberg: First of all I have to say I have not personally considered the second question. I have no doubt that others have but I have not, so I cannot answer that, I am afraid. As far as the first is concerned, it does seem to me highly desirable that there should be provision in relation to the security services. The fact of the matter is that security services are required from time to time to act in a way which would contravene what the law is in order to protect national security and to protect the people of the country. I think it is much more desirable that that should be within a framework within which Parliament has authorised with checks and balances and set out clearly rather than leaving it to the discretion of the prosecutor at the end of the day simply to say whether it was appropriate or not. This follows the model which we have, of course, in the Intelligence Services Act in relation to other matters which I believe do enable the agencies to operate effectively but subject to the checks and balances which are necessary.
Q594 Lord Campbell-Savours: Can I take you to the actual language. As I understand it we are now talking about authorised operations. What happens in an authorised operation if a particular officer carries out an act, a corrupt act, which is part of the authorised operation, he has done it as part of his work during the course of an authorised operation, is it possible that that person might be shielded from prosecution if the particular act of corruption in which they were involved if it fell under the general heading of authorisation but was not actually authorised? It is very hard to give an example without talking about, let us say, agents and how they operate in a field. One can envisage circumstances where the operation is authorised where perhaps they do something under the heading of that authorised operation which is not what was intended and which was corrupt and for which perhaps they should be prosecuted.
Lord Goldberg: That turns very much, as it does under the Intelligence Services Act, on the form and the precision of which authorisations are given. No doubt those will depend on operational matters, operational questions and considerations which are not for me but for others as to what you can predict is going to be necessary in order for some intelligence officer to be able to do what is necessary in the performance of his duty. He needs the protection of knowing that if he acts in accordance with the framework which is set out he is not going to be subject to prosecution. I suppose the public also need the assurance of knowing that acts which are done have been through a process which involve checks and balances and authorisations through people who are accountable to the public through Parliament.
Q595 Lord Campbell-Savours: Yes. The actual act that he carries out might not be what was intended when the authorisation was granted, it might be an act which should be the subject of prosecution. Can you not envisage circumstances - I am just putting the proposition to you - where some might say, we should be prosecuting this man however we cannot because he falls under the section which states that if the operation is authorised he is exempt.
Lord Goldberg: It is not the operation which is authorised, it is the act or omission which is authorised. Clause 15(2) says: "The person does not commit a corruption offence if the act or omission done or made is authorised to be done or made by virtue of an authorisation given by the Secretary of State." The act falls within the terms of the authorisation and not whether or not it has been done in the course of an operation, which is the authorised. That is why I said that a lot will turn on the precision or otherwise of the authorisation, recognising it is a practical fact in advance of certain things taking place. No doubt it is difficult to predict precisely what will be necessary. These are not questions for me, these are questions for those who are responsible for the security services, I am just looking at it from a point of view of prosecuting.
Q596 Mr Shepherd: A lot of their work is subcontracted and they become designated and therefore the code of secrecy is very profound in that system. I am not criticising, I am just noting it, for the lawful authorities. For the local authorities to know whether an act has been done in accordance with the provisions of this exemption is quite difficult, and for society to ensure that there is a check and balance.
Lord Goldberg: This is a very general statement. We have moved to a situation of greater authorisation and regulation of what intelligence services do as a result of legislation which has been passed. This fits in with it and includes parliamentary accountability through particular mechanisms.
Q597 Mr Shepherd: There is no public interest on this for bringing it to the attention of the proper authorities that something may be improper. I do not mean to put this beyond the circumstances of your attendance here.
Lord Goldberg: Something might well be brought to my attention, whether or not it falls within the exemption if the exemption is passed.
Q598 Chairman: Attorney General, thank you very much for coming, we are very grateful for your help on these questions. If we have anything else we would like to ask you we can do it in writing.
Lord Goldberg: I would be happy to try and answer it.