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Lord Richard: My Lords, surely I cannot make two bad points in the same evening! Certainly, I thought that I heard the noble Lord, Lord Bethell, say that. I have noted him down as saying that. It is certainly a good point as regards the noble Lord, Lord Chalfont.

Lord Chalfont: My Lords, perhaps I may intervene just to say that that is exactly what I did say and that the noble Lord has a very good point.

Lord Richard: My Lords, I am much obliged. Reinforcements have arrived. As I say, I believe that the issue of openness and the extent to which these services are now more subject to public scrutiny and disclosure is one which I am glad the House discussed this evening.

Perhaps I may make a basic point, as I see it, as regards these services. First, the collapse of the old Soviet Union empire in eastern Europe, and the apparent decline of Russian influence elsewhere, has not reduced the need for the Government to have proper secret intelligence. That seems to me to be the basic first point. The second point is that the uncertainties of the old Soviet Union and of the Middle East, as well as the interests of the United Kingdom in other parts of the world, have created a situation in which the UK's political, military and commercial interests still require the Government to be well informed about the intentions and activities of other governments and groups. The third point, which flows from the first two, is that this requirement is now made more pressing by the gradual spread of weapons of mass destruction, whether they are nuclear, biological or chemical. I therefore agree with a large part of what was said by the noble Lord, Lord Chalfont, and by the noble Baroness, Lady Park in this respect.

The fourth basic point is that the threat to British interests from terrorism has not declined. The return of the provisional IRA to violence is a great disappointment, but perhaps it is not entirely surprising in view of the history of the past two to three years. But it is a disappointment that they have apparently returned to a degree of violence. Middle East terrorists are still active. Some groups decline and others grow. But the need to maintain coverage of their activities is constant because it is difficult to predict when they will turn on British interests.

So I finish with the basic conclusion on this part of what I have to say. The continuing efforts by the security and intelligence services are clearly necessary

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in such an unsettled world. Indeed, the more unsettled the world is the greater the need for vigilance. The end of the Cold War and financial pressures have meant that the agencies, like other departments, have had to trim their budgets, but we must be careful that the cuts are not so severe that the agencies do not have the staff to respond to new threats. The coverage of organisations which threaten United Kingdom interests cannot be achieved overnight from scratch. Again, I agree with what the noble Baroness, Lady Park, said on this. Experience in this field takes time to develop.

The agencies have received a bad press on occasions in the past. Some of it was deserved, but much of it was not. As the noble Lord, Lord Cuckney, said, successes often cannot be told, and even when they can they frequently receive very little attention.

Public perception of the agencies has improved, thanks presumably to the introduction of the legislation and the new oversight arrangements. That has allowed proper debate about their role and, through the oversight bodies, a fairer assessment of their performance. I agree with the noble and learned Lord, Lord Howe, that the noble Lord, Lord Knights, should not apologise for raising the issue that he did. It is contemporary, it is pretty fundamental and it is something that I am not sure we have yet got right. Therefore, I should like to spend one or two moments trying to deal with the issues raised by the noble Lord.

The Security Service Act empowered that service to investigate threats to national security which were, in effect, espionage, terrorism and subversion. The extension of its responsibilities to cover organised crime is prima facie logical. Organised crime is growing, thanks to the money to be made especially from drugs; and the state of the world where, in countries like Russia, law and order seem to be on the verge of breaking down, thus allowing and even encouraging organised crime. We must also bear in mind the ease of travel and the speed with which money can now be sent through the banking system. In its more extreme forms, organised crime poses a threat to the security or, if your Lordships prefer, to the wellbeing of the nation.

I am not against the idea that the Security Service and other agencies should have their responsibilities extended because their skills can contribute to the investigation and combating of organised crime. Those skills have been learnt over many years and include long-term investigations using high quality personnel and methods. The Security Service, after all, has a proven track record of success in its work in support of the police against one of the most effective terrorist organisations in the world, the Provisional IRA.

The Security Service has some experience of investigations where it is necessary to collect evidence for presentation in court or to allow investigations to proceed in such a way that others, such as the police or Customs, may actually collect the evidence and bring the prosecution. Also, it has already had some years of experience of effective co-operation with the police and Customs. However, it is important to emphasise that the lines of accountability must be clear. As the noble Lord, Lord Knights, said, that is difficult, but that very difficulty underlines the importance of the point.

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The role of MI5 in relation to organised crime has to be one which is basically supportive. I believe that that is recognised by MI5 itself. I do not think that the public would be happy with a situation in which the security services were operating freely in a police environment. I believe that many people would accept that they should support the police in such important areas, but I do not think that people would accept that they should operate freely without the police being in the lead.

I conclude by thanking the noble Lord, Lord Campbell of Croy, for initiating a debate in which I have made at least two bad points, but I hope that I have made five that are good.

7.23 p.m.

Lord Chesham: My Lords, I too thank my noble friend Lord Campbell of Croy for tabling the Motion and all noble Lords who have participated in the debate for their thoughtful and stimulating contributions. I am almost overawed by the experience and knowledge of speakers.

I have listened with great interest to the debate, which has touched on a range of matters to which the Government attach considerable importance. As noble Lords are aware, the Government have taken a series of important steps towards greater accountability and openness, wherever possible, in security and intelligence matters. As has frequently been mentioned, with the passage of the Security Service Act 1989 and the Intelligence Services Act 1994, all three intelligence and security agencies are now avowed and have been placed on a statutory basis. The figure for their aggregate expenditure is published annually. In addition, a Committee of Parliamentarians, the Intelligence and Security Committee, established under the Intelligence Services Act, now scrutinises the expenditure, administration and policy of all the agencies, and has so interestingly been described by my noble and learned friend Lord Howe.

However, it is important to make a distinction between proper accountability for the agencies in areas such as finance and administrative policy, and the continued need for secrecy regarding operations. If the agencies are to perform their responsibilities effectively, they need the protection which secrecy offers. Hence, this Government, like their predecessors, have refused publicly to provide information on the operations of the security and intelligence agencies, including matters which fall within the scrutiny of the Intelligence and Security Committee. Comment on such matters, either through what is said or what is not said, could have a bearing on the effectiveness of the agencies, on the safety of their staff and those who co-operate with them, and on their ability to retain the confidence of those with whom they work. Those very considerations preclude me from responding to some of the issues raised by noble Lords.

I now turn to the functions appropriate to the agencies in the 1990s. The Cold War may have ended but, as has frequently been said, the world remains a dangerous place. One might say that though we have

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slain the dragon, we have entered a wood full of snakes. Threats to British interests worldwide continue to abound--international terrorism, weapons proliferation, espionage, serious crime in all its various forms, including drug and arms trafficking and financial fraud. Indeed, in the case of nuclear weapons proliferation, for instance, the risk has actually increased as a direct result of the break up of the former Soviet Union and its stock of arms. This general perception is shared by many of our allies and democratic neighbours, who, like us, see the need to maintain effective intelligence services.

My noble friend Lord Campbell of Croy mentioned co-operation with other countries, as did other noble Lords. The threats of terrorism and espionage and from proliferation are international, and are hence more easily identified if like-minded countries co-operate. The agencies therefore maintain contact with a wide range of individuals and organisations, a two-way process of advice and assistance which is of great benefit to the UK national interest. Close intelligence relations are maintained with allies, for example, in NATO. Liaison with other countries has given invaluable help in protecting UK interests.

My noble friend Lord Bethell asked specifically about co-operation with the Russians on, for example, drugs, nuclear proliferation and counter-terrorism. Her Majesty's Government have discussed with the Russian authorities the issues highlighted by my noble friend. The United Kingdom's security and intelligence agencies engage in collaboration with the intelligence and law enforcement agencies of a large number of countries where we have common interests and concerns. Such arrangements depend on confidentiality and it is not the Government's practice to comment on that or other operational activities of the agencies.

We have had some discussion of the Security Service Bill. Your Lordships' House will have an opportunity to debate that shortly. I refer to the serious crime function of the Security Service. Those provisions will come before this House soon. I do not want to pre-empt that debate, but I suggest that the Bill represents a good example of the sensible evolution of the role of an intelligence agency to take account of changing circumstances. The threat posed by organised crime is a serious one. It is also growing in sophistication and complexity. We must ensure that our law enforcement agencies have all the necessary skills, resources and support at their disposal to tackle that threat. They already benefit from the valuable support of SIS overseas, but the Security Service is not permitted by law to lend assistance here in the United Kingdom. The Government believe that it would be sensible to allow ourselves the opportunity of using the skills and capability of the Security Service, when circumstances permit and subject to appropriate controls, in support of the efforts of the police and other law enforcement agencies.

I assure your Lordships that extending the functions of the Security Service will not be to the detriment of its existing responsibilities. Dealing with terrorism will remain the service's top priority. The allocation of resources to the proposed new functions will be subject

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to the demands placed on its other functions. It is essential that the service retains the flexibility to respond to sudden demands in respect of any of its functions.

So far as concerns public acceptance of the security service--we are talking about openness and safeguards--the security service is the first to recognise in today's climate of openness the need for public understanding and acceptance of its role. To that end, a number of significant steps have been taken to provide the public with more information about the service and its work while bearing in mind the need to ensure that its operations are not compromised. That was a point emphasised by the noble Lord, Lord Chalfont, and my noble and learned friend Lord Howe.

In 1991, the director general was named for the first time. The location of the headquarters of the security service has been disclosed. The security service's booklet published in 1993 made available for the first time a considerable amount of information about the service's work. The director general has built on that during her three lectures to public audiences--the Richard Dimbleby and James Smart lectures in 1994, and her speech to the English Speaking Union in 1995.

But public acceptance is not just about openness. It stems also from the knowledge that there are proper statutory safeguards to ensure that the service acts only in accordance with its functions. Above all, it is important to understand that the security service is fully accountable to the civil and criminal law.

As my noble friend Lord Cuckney said, the Security Service Act 1989 established a number of safeguards. First, the Act provides for a tribunal comprised of senior members of the legal profession to investigate complaints from members of the public who are aggrieved by anything they believe the security service has done to them or to their property.

Secondly, the Act provides for a commissioner, who is a senior judge, to oversee the authorisation by the Secretary of State of warrants allowing the service to enter or interfere with property and to assist the tribunal in its work. Both the commissioner and the tribunal are independent.

In addition, the service is subject to the Interception of Communications Act 1985, which makes it illegal to intercept mail or telephones on the public network unless the interception has been authorised personally by the Secretary of State. The Act provides also for oversight by an independent commissioner and a complaints mechanism for members of the public. The Intelligence and Security Committee established under the Intelligence Services Act 1994 provides a further mechanism for oversight and accountability.

It is important that members of the service who are concerned about the nature of the work they are required to undertake can discuss their concerns with someone outside the service. That role is fulfilled by a staff counsellor who is independent of the service.

The noble Lord, Lord Kennet, mentioned co-operation with the USA. There is some history of that. US operations in the UK are covered by arrangements made under the 1951 agreement and the Visiting Forces Act 1952. No activity considered

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inimical to the UK's interest is or would be permitted. The US has undertaken to respect UK law under Article 2 of the NATO Status of Forces Agreement.

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