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Earl Russell: My Lords, perhaps I may be forgiven for adding a small footnote to what my noble friend Lady Harris of Richmond said, with which I fully concur. Like her, I welcome the spirit in which the noble and learned Lord introduced the order.

My small footnote concerns what was, when it left this House, Section 7 of the Asylum Act 1996. That authorised the police to stop and search anyone on suspicion of being an illegal immigrant. The potential for that to be used in a discriminatory manner is considerable. The noble Viscount, Lord Bridgeman, referred to the need to avoid legislation discriminatory in its impact. Will the noble and learned Lord consider whether this may perhaps be a case in point?

Lord Falconer of Thoroton: My Lords, I thank the noble Viscount, Lord Bridgeman, the noble Baroness, Lady Harris of Richmond, and the noble Earl, Lord Russell, for their support, both for the terms of the code of practice and the way in which it was introduced.

I can readily give the noble Viscount, Lord Bridgeman, the assurance that he seeks. He asked that the order should be kept under review and for an undertaking that it would be changed if appropriate. As to keeping it under review, I draw the noble Viscount's attention to the unit referred to by the noble Baroness, Lady Richmond, which was set up in the light of the recently published Section 95 statistics showing the "eight times more likely to be stopped and searched" statistic to which we have all referred.

The noble Baroness, Lady Richmond, referred to Recommendation 61. She will be aware—but it is worth putting it on the record—that we intend to carry out several trials and pilots from spring of next year. They are not yet up and running. They will be carried

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out at the behest of the chief constables in the relevant forces. It will be a matter of administrative practice, therefore it will not require PACE code amendments. However, when they have been evaluated in due course and we have identified the best way in which to introduce the power nationally, we anticipate a further revision of the code. So, as has been said, we are going about it in a phased way.

Finally, I take note of the point made by the noble Earl, Lord Russell. I shall reflect upon it and write to the noble Earl.

On Question, Motion agreed to.

Proceeds of Crime Act 2002 (Cash Searches: Code of Practice) Order 2002

7.20 p.m.

The Attorney-General (Lord Goldsmith) rose to move, That the draft order laid before the House on 25th November be approved [3rd Report from the Joint Committee].

The noble and learned Lord said: My Lords, I should inform the House that the Joint Committee on Statutory Instruments approved the draft order last Tuesday, 3rd December and that a Standing Committee in the other place approved it this afternoon.

I hope that your Lordships have had the opportunity to study the explanatory memorandum and the draft code of practice which provide background on the need for and content of the draft order.

Your Lordships will recall that the Proceeds of Crime Act contains a comprehensive package of measures focusing on the recovery of criminals' proceeds and wealth. Included in the provisions is a scheme for the recovery of cash in summary proceedings. These can be found in Chapter 3 of Part 5 of the Act. The draft order before the House brings into operation a code of practice connected to that scheme.

Provisions relating to the recovery of cash are not new. The Criminal Justice (International Co-operation) Act 1990 introduced a power for police and Customs officers to seize cash discovered on import or export which was reasonably suspected of being derived from or intended for use in drug trafficking. An application could then be made subsequently in a magistrates' court for the forfeiture of the cash. No conviction was required for the forfeiture of the cash to be ordered. Cash forfeiture proceedings are civil proceedings and the civil standard of proof applies. These provisions were later consolidated into the Drug Trafficking Act 1994, which applied on a UK-wide basis.

The Proceeds of Crime Act replaces and extends this scheme to cash related to all unlawful conduct and also provides for the seizure of such cash inland. Like the previous legislation, the Act provides for a minimum amount of cash in respect of which the search and seizure powers may be exercised. My honourable friend

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the Under-Secretary has made and laid before Parliament the Proceeds of Crime Act 2002 (Recovery of Cash in Summary Proceedings: Minimum Amount) Order 2002, which sets the minimum amount at £10,000.

Significantly, police and Customs officers have no existing specific power to search for cash inland. Under previous legislation, Customs officers could rely upon their general powers of search at the borders under the Customs and Excise Management Act 1979. The Police and Criminal Evidence Act 1984 allows police to search for evidence. Cash may be evidence, but not in every case. A specific search power is therefore necessary to support the ability to find and seize cash inland.

In recognition of the sensitivity of search powers, this new search power is subject to a number of safeguards, including a statutory code of practice. The code is required before the search powers can come into operation. Section 292 of the Act requires that the code be made in connection with the exercise of the search powers by a constable or Customs officer. The code has been drafted and the draft order before the House will bring that code into operation.

An initial draft of the code was published for public consultation on 23rd August. That consultation period ended on 15th November. Revisions have been made to the draft code in the light of the comments received, and a summary of the responses to the draft code and the Government's comments are in the Library.

The draft code has a short introduction. It places an obligation on the police and Customs to ensure that the code is publicly available for consultation. The Government believe that the availability of the code will ensure that the operation of the power will be open to public scrutiny and accountability.

The draft code draws particular attention to the officer's obligations under the Human Rights Act and the Race Relations Act. I am satisfied that this order and the code are compatible with both of these Acts. It is vital that the rights and protections conferred by these Acts are uppermost in an officer's mind when he is considering and exercising the search power. The draft code defines the limitations of the search power and gives guidance on the objective tests required for forming "reasonable ground for suspicion" before a search can be undertaken.

The draft code also provides guidance on the procedure required when an officer is seeking judicial prior approval, as provided in Section 290 of the Act. Rules have been made by my noble and learned friend the Lord Chancellor under which a justice of the peace can hold an application hearing in private away from the court. This will allow flexibility in arranging applications quickly and will encourage officers to use this route rather than their own administrative powers of search.

"Reports to the 'Appointed Person'" gives guidance on the requirement in Section 290 of the Act to report to an appointed person and sets out the related procedure. A report will be required to be sent to the appointed person where searches were not approved by a justice of the peace and cash was either not seized

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or not detained for more than 48 hours. The appointed person is an independent person overseeing the operation of the new search power.

The remaining sections of the code deal with the steps prior to a search, the actual search of both persons and premises and the officer recording his actions. They ensure that officers conduct searches in a reasonable manner and provide several limitations and safeguards on that power. For example, paragraph 32 sets out the limitations of a search, disallowing the forcible removal of objects next to the skin, and paragraph 36 requires that searches should be performed at a reasonable hour where practicable.

The draft code is intended to be self-explanatory and easily understood and any further detail I give would merely be repetition of the document.

In summary, I am satisfied that the draft code sets out clearly the processes and safeguards required for the operation of the new search power. I hope that having more than 4,500 words shows the detail of best practice that we are imposing on officers and satisfies noble Lords that searches will have the required safeguards as checks on the power.

Because of the nature of the draft order I have spoken more to the draft code rather than to the order. The only further point specifically on the order is that it brings the code of practice into operation on 30th December. My honourable friend the Under-Secretary has signed a commencement order bringing the cash scheme into force on that date.

I commend the order and the draft code of practice to the House.

Moved, That the draft order laid before the House on 25th November be approved [3rd Report from the Joint Committee].—(Lord Goldsmith.)

Viscount Bridgeman: My Lords, we on this side of the House support the order which, as the noble and learned Lord, Lord Goldsmith, made clear, effectively gives teeth to the power to seize cash conferred under the Proceeds of Crime Act 2002.

We note that the language and structure of the order are based on similar codes of practice under the Police and Criminal Evidence Act 1984, where these procedures for search are largely proven. I certainly welcome the assurance of the noble and learned Lord that the code complies with the Human Rights Act and with the Race Relations Act.

We are pleased to note the requirement for prior judicial authorisation wherever possible; the requirement for a report giving reasons for any action where such approval has proved impracticable—one presumes that that will be largely on grounds of time considerations; and, indeed, for the requirement that any search operations must be fully reported.

We also note that any searches, whether of persons or of premises, must be proportionate. That leads me to the question that I asked the noble and learned Lord, Lord Falconer, earlier. The whole issue of proportionality is subjective. I should welcome an

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assurance that this is being kept under review. There are constant changes, not only in the technology but also in the increasing sophistication and resourcefulness of criminals in making use of it; and also in terms of the increasing globalisation of crime. With that request for an assurance, we on these Benches welcome the order.

7.30 p.m.

Lord Goodhart: My Lords, the order is to a large extent dictated by the terms of the Proceeds of Crime Act. It is very much in line with what one would have expected under that Act. Certainly, we on these Benches have no quarrel in principle with the proposals in the order. But I am afraid that, having looked through the code of practice, I am going to make a few rather tedious points on the drafting—which is less than perfect and not as good as one would have hoped.

First, paragraph 9 reads:

"Where the power to search a person is exercised the Act requires that the officer or constable"—

the words "or constable" are unnecessary, since the word "officer" has already been defined as including a constable—

"may require the suspect—so far as he thinks necessary or expedient—to permit (a) a search of any article he has with him; or (b) a search of his person".

It is provided that an officer may detain the person for so long as is necessary to carry out the search.

This implies that detention is possible where the search is carried out under either (a), the search of an article, or (b), the search of the person. In fact, the authorising provision of the Act—namely, subsections (3) and (4) of Section 289—makes it clear that detention is only possible under (b), that is, for the purpose of the search of the person, and that there can be no detention for the purpose of searching an article that the person has with him. Perhaps the noble and learned Lord the Attorney-General would comment on that.

The third sentence in paragraph 10 is ungrammatical and reads extremely awkwardly.

Paragraph 22 states:

"The report must be submitted to the independent person appointed by the Secretary of State"—

Simply by way of comment, I think it slightly unfortunate that one is left with the statutory phrase "the appointed person", which I assume is due to the fact that the "appointed person" has not yet been appointed. It might have been easier for people reading the code to understand it if someone had been appointed already and could be referred to by name in the code—subject, of course, to it being made clear, as with the minimum figure of £10,000, that the information is subject to change.

Perhaps more importantly, the second sentence of paragraph 22 says that,

"Reports in respect of searches undertaken by customs officers in Scotland, must be submitted to the independent person appointed by Scottish Ministers".

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It is clear from Sections 290 and 291 of the Act that reports not only by Customs officers but by police officers in Scotland must be submitted to the independent person appointed by Scottish Ministers. So, in so far as the reference is specifically and exclusively to Customs officers, the statement in paragraph 22 is incorrect.

Moving on to paragraph 35, I am afraid that once again the sentence is ungrammatical.

I ask the noble and learned to comment on a point in the fourth sentence of paragraph 36, referring to rights of entry. It states:

"It would also include a search carried out when an officer has exercised a power of entry conferred by a search warrant granted in some other connection or power of entry conferred under some other legislation such as the Police and Criminal Evidence Act 1984 or Customs and Excise Management Act 1979 and circumstances subsequently lead him to believe that there is cash on the premises".

I should have thought that where a right of entry was conferred under some other statute it would be legitimate to carry out a search even if the officer conducting the search believed before entering the premises that cash might be there; whereas paragraph 36 suggests that it must be circumstances subsequent to the lawful entry which lead him to believe that there is cash on the premises.

On a further grammatical point, in paragraph 40 the expression,

"the object of the search",

is given quite different meanings in two successive sentences. The first sentence states:

"Premises may be searched only to the extent necessary to achieve the object of the search".

The paragraph then goes on to say:

"A search may not continue once the object of the search has been found"—

where, equally plainly, the term means the thing that you are looking for. I also wonder whether in the second sentence "the object of the search" has any obvious meaning when you are talking about cash, because cash is not normally a single object but a whole series of objects and it may be difficult to be certain that you have found all the cash that you are looking for.

Those points are, as I said, rather tedious. In making them I do not intend to suggest that we do not fully support the purposes behind the order. I await the noble and learned Lord's reply with interest.

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