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Viscount Goschen: My Lords, I rise briefly to support Amendments Nos. 7 and 8, which give the court a discretionary "get out" clause. We have heard that Clause 75 specifies that one of the conditions of a criminal lifestyle shall be considered if the defendant is convicted of any of the offences within Schedule 2. Schedule 2 contains a wide range of offences, from serious issues such as arms trafficking and drug dealing to offences which are serious but could be the result of fairly minor convictions. I am thinking of the reference within Schedule 2 to copyright offences. In Committee I suggested instances where the defendant could have committed a relatively minor offence but must be considered to have a criminal lifestyle because that offence is specified within Schedule 2. The example I gave was of a student who might have made or dealt in an illicit recording; who might perhaps have illicitly copied a CD or video and distributed it to his or her friends.
When I raised that in Committee, the noble and learned Lord, Lord Goldsmith, drew our attention to the fact that dealing would have to take place. There would have to be a commercial basis. But what if that were the case and the theoretical student copied a CD on to cassette and distributed it among his friends for money? That individual may well be guilty of a copyright offence. But surely, if it were done on a minor basis, it would be absurd to say that that individual had a criminal lifestyle. Therefore, the court should have discretion in proceeding.
The Attorney-General (Lord Goldsmith): My Lords, there are three groups of amendments. They have been divided slightly differently by noble Lords, but all are on the theme of criminal lifestyle. I would divide them in this way. The first two groups of amendments are rather similar because the effect of both groups would be to prevent the criminal lifestyle procedures from being triggered under certain circumstances. Amendments Nos. 7, 37 and 66 would empower the court not to decide whether a defendant had a criminal lifestyle if it considered that there were exceptional circumstances. Where it decided to exercise its discretion, the court would not proceed to confiscate the defendant's benefit from his general criminal conduct. I assume that the court would still be required to confiscate the defendant's benefit from his particular criminal conduct.
Amendments Nos. 8, 38 and 66 would require the court to decide whether the defendant satisfied the criminal lifestyle test, but it would nevertheless be able to decide that he did not have a criminal lifestyle if it was satisfied that there would be a serious risk of injustice in so doing. Again, where the court exercised that power, there would be no attempt to confiscate the defendant's benefit from his general criminal conduct. However, as with the first group of amendments, the court would nevertheless be required to confiscate his benefit from his particular criminal conduct.
The effect of the third group of amendments is straightforward. The amendments would make it impossible for any criminal to be treated as having a criminal lifestyle where the offence or offences of which he had been convicted were not punishable by imprisonment. As the noble Baroness, Lady Buscombe, said, those areas have been covered both in Committee and in another place.
I shall start with the first two groups of amendments. Both those groups would dispose of one of the central policies of the Bill and as such would be wholly unacceptable to the Government. It is important that criminals know exactly what they expose themselves to in confiscation terms when they commit criminal offences. One of the great strengths of the Bill is that it makes clear when crimes will attract a criminal lifestyle regime and when they will not.
Introducing a discretionary power not to proceed, whether it refers to exceptional circumstances or to a serious risk of injustice, would do away with that certainty and introduce instead what the Government regard as an unnecessary subjective and discretionary element. It would also erase the consistency of approach that we hope to achieve across the jurisdiction, because courts up and down the land would almost certainly exercise the powers differently in cases that were not in fact materially different.
I anticipate that your Lordships would agree that the inconsistent application of justice is bad and undesirable. The Government do not consider either as a matter of principle. There can be either exceptional reasons for the court not to proceed or a serious risk of injustice in treating a defendant as having a criminal lifestyle. The criminal lifestyle regime has effect only where there is good reason to suppose that the defendant is living off crime. The tests have been carefully selected to catch only repeat offenders or those guilty of lengthy or inherently acquisitive offences. I am grateful again for the appreciation expressed by the noble Baroness, Lady Buscombe, at the schedule identifying those latter offences.
However, I remind your Lordships of the safeguards that can be relied on. First, the confiscation hearings are instituted only by the court or on the application of the director of the agency or the prosecuting authorities. The director and the prosecuting authorities are under a duty to act reasonably and will not mount hearings in inappropriate cases.
Furthermore, in a criminal lifestyle case, the court has power not to make the assumptions, if the assumptions—obviously—are shown to be incorrect or if there would be a serious risk of injustice. I give way to the noble Lord, Lord Goodhart.
Lord Goodhart: My Lords, does the noble and learned Lord the Attorney-General therefore accept
that a decision of the prosecution to proceed with an application for a confiscation order could be judicially reviewed on the grounds of irrationality?
Lord Goldsmith: My Lords, I need to consider that because normally, and in many cases, the decision of a prosecuting authority in the exercise of its discretion is not amenable to judicial review. I shall certainly consider the question and come back to the noble Lord.
In terms of the Human Rights Act, the prosecuting authorities are public bodies and subject to the duties under that Act.
I want to emphasise that the provisions of Clause 10(6) of the Bill, state that the court,
- "must not make a required assumption in relation to particular property or expenditure if—
- (a) the assumption is shown to be incorrect, or
- (b) there would be a serious risk of injustice if the assumption were made".
If the court therefore decides not to make the assumption, because it is shown to be incorrect or because there is a serious risk of injustice, the prosecutor or the director—whoever is bringing the case—will have to prove on a balance of probabilities every penny of the defendant's benefit.
For those reasons, shortly, the regime that has been constructed appears to us to be soundly based. I want to remind noble Lords of two matters. First, the idea that it is mandatory for the court to embark on a process of confiscation and mandatory in certain circumstances for it to make assumptions is not new to the Bill: it exists already in legislation.
I took the trouble to ask what was said in another place during the passage of the Drug Trafficking Bill 1993, which became the Drug Trafficking Act 1994. The then Minister—of course the Minister in the party of the noble Baroness—said, in referring to discretionary assumptions, that:
- "During the six years in which the legislation has been in force, the courts have declined to apply the assumptions in a number of major cases, thereby placing the prosecution in the impossible position of being expected to prove matters in relation to the offender's property which are solely within his knowledge".—[Official Report, Commons, Standing Committee B, 8/6/93; col. 76-77.]
The noble Baroness stated that the onus would be on the defendant to show a serious risk of injustice for the purpose of Clause 10(6)(b), to which I have just referred. But under Clause 16(4) the prosecutor must state if he has any information to suggest that there might be a serious risk of injustice if the assumptions are made.
I turn to the third group of amendments. One of the fundamental approaches to the Bill is to deal with the proceeds of crime on an "all crime" basis. In the context of criminal confiscation, that means both the benefit from any criminal conduct—summary or indictable—should be liable to confiscation and that any offence should be capable of triggering the criminal lifestyle provisions, provided that the specified criteria—repetition of offences and so forth—are satisfied.
In the criminal lifestyle schedules, the offences are both indictable and attract terms of imprisonment. The amendments exclude the possibility of an offender who satisfied one of the other tests being treated as having a criminal lifestyle where the offences did not attract a term of imprisonment, regardless of the duration and regardless of the number of times such offences had been committed. Therefore, to introduce what is proposed in these amendments would be to introduce a test which is no less arbitrary than the test proposed by noble Lords in amendments tabled earlier in the passage of the Bill; namely, that the triggering offences should each have generated a certain level of proceeds.
The tests which are set out in Clause 75(2)(b) and (c) are not designed to reflect the seriousness of the offences but the duration and repetition of the offences concerned. The fact that they have given rise to benefit is an indication that the defendant has a criminal lifestyle. As has been said before, it is the capacity of offences to generate benefit that drives the agenda, not their seriousness in other ways. Again, I remind noble Lords that a number of offences specified in Schedule 4 to the Criminal Justice Act 1998—that is existing confiscation legislation which provides for confiscation where there are certain repeat offences—also include offences which are summary only and which include no term of imprisonment.
So there is nothing new in including the possibility of offences which are summary and which do not carry imprisonment into this kind of legislation. That means that at the moment if two or more convictions are obtained, the magistrates' court has the power to make a similar confiscation order to the criminal lifestyle order under the Bill.
So we believe that allowing the third group of amendments would represent a weakening of the current powers of the courts. Two particular questions were raised. The first was by the noble Lord, Lord Goodhart, about a body corporate. A corporate body is a person and can have a criminal lifestyle, subject to the usual rules about showing the necessary mens rea, the necessary mental state, for the commission of offences. As the noble Lord says, to allow a vehicle to be used as the means of committing crime and gathering the proceeds of crime as a device for avoiding the implications and the safeguards in the Act would be wrong. So of course he is right to say that a corporate body should be covered. If a developer, for example, was repeatedly flouting local authority laws and making substantial profit, I respectfully suggest that it would be appropriate to apply the criminal lifestyle test where the prosecutor applied for it.
As he did in Committee, the noble Viscount, Lord Goschen, raised the question of copyright— in particular offences relating to commercial distribution. Today, he raised the example of a student. If a student were involved in such activity on a commercial basis, if he were engaging in the sort of crime that gives rise to substantial benefit—that is, piracy of intellectual property, counterfeiting and large-scale distribution—I think that the noble Viscount would agree that it is appropriate that he should be subject to that process.
It will always be possible to identify examples in which the prosecutor is most unlikely to proceed with an application. Whether it is the supermarket chain with three minor food safety convictions or a student doing something minor who gets himself on the wrong side of the provision because his activities are in some way termed commercial—although I cannot quite understand how that would happen—I should not expect the prosecutor to proceed. Earlier, I reserved the question of whether a decision could be judicially reviewed. The view of my advisers is that there could be judicial review of the prosecutor's decision to ask for a confiscation order. I suggest that the public interest is such that such an application would rarely be successful, but as the noble Lord, Lord Goodhart, raised the matter, there is an additional safeguard for him.
So all three groups of amendments would substantially undermine central provisions of the Bill. I therefore invite the noble Baroness, Lady Buscombe, to withdraw her amendment and the noble Lord, Lord Goodhart, not to press his.
4 p.m.
Baroness Buscombe: My Lords, I thank the noble and learned Lord the Attorney-General for his response, although I am deeply disappointed by it. As I said in opening, these important matters of principle have been debated at length both here and in another place with good reason but, sadly, not to our satisfaction.
We are asking for a minimum safeguard to kick in in exceptional circumstances. We are concerned when the Attorney-General refers to the amendments introducing an unnecessary, subjective and discretionary element. Is introducing such an element into our criminal justice system so terrible? What is the Government's approach to the ability of the courts and the judges to decide, in exceptional circumstances, whether it is right for a prosecutor to be able to ask and, as a result of that simple question, for an investigation to take place?
There is a serious problem here. Let us turn the argument on its head. As drafted, the Bill provides that the court must make a confiscation order even if it is of the opinion that exceptional circumstances justify it not doing so. That cannot be right; no one could possibly agree with that.
Turning to the amendments to Clause 75 and the interpretation of "criminal lifestyle", it is clear that as drafted the tests are not designed to reflect the gravity
of the offences but, as the Attorney-General said, to test the duration of the course of the criminal activity during which what may be very minor offences have been committed. We are genuinely concerned about that. I respectfully suggest that the weakness of the Attorney-General's argument was demonstrated when he said that in the case of three minor offences relating to food safety standards or a student copying music onto CDs, the Government would not expect the prosecutor to proceed. The point is that the prosecutor can proceed.In Committee, the Attorney-General dismissed the prospect of the over-zealous and unreasonable prosecutor. But that may be wishful thinking. With the expected creation of financial targets for the assets recovery agency, there will be pressure on prosecutors unrelated to the merits and justice of each case. Nowhere is the dichotomy between criminal justice and revenue generation in the Bill so clearly in view. Surely it is only right for the judge, who has sole responsibility to determine these matters, to retain residual discretion.
We are deeply concerned about those issues. We are now at Report stage. By tabling amendments that would reserve opportunities for discretion to exceptional circumstances, we have been entirely reasonable and sensible. On that basis, I wish to test the opinion of the House.
4.7 p.m.
On Question, Whether the said amendment (No. 7) shall be agreed to?
Their Lordships divided: Contents, 137; Not-Contents, 131.
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