Secondly, it would appear that more than one body will be involved in the criminal investigations. By that, I mean the IPCC and the police. It is imperative that those investigations should be properly integrated. It would be intolerable if any sort of disagreement between the bodies involved led to anything short of complete integration or any repetition and unnecessary duplication in the investigations that take place.

Thirdly, the work of the panel provides an incredibly good route map for the investigation. There is no doubt, as the right reverend Prelate the Bishop of Liverpool acknowledged, that there is a need for further investigation, but the investigation now knows so much more about what happened than any other normal police investigation. Build on it, do not reinvent the wheel and use it as a route map.

Fourthly, it is important to make sure that all the investigations that take place and any subsequent prosecutions are properly resourced. I know from my own experience within government that properly resourced investigations are incredibly effective and focused. In the past 15 years, we have seen investigations take place in relation to particularly heinous crimes. This can happen in this case. Resources are important.

Fifthly—again, I pick up a point made by the right reverend Prelate—it is important to consult the families throughout the investigation and the processes. The families have said directly to the Home Secretary, who was sympathetic and incredibly decent in her response—and they said it in my presence—that trust has to be earned back in the light of what has happened. Regaining that trust will be greatly assisted by consulting the families and discovering what their wishes are—not to compromise independence but to ensure that their views are taken into account.

Sixthly, it is necessary to build into the process something that does not deprive the investigation and the prosecution of their independence but makes sure that the process has drive and momentum, even when the searchlight of publicity has moved on.

Finally, from beginning to end, until 12 September, this has been a series of processes whereby the state and other bodies have failed—and have failed the families and the people they were supposed to serve—including the football authorities, the football grounds involved, the media, the police, the emergency services, the prosecution authorities, the judges and the coroner’s court. They have all been found wanting, as the panel’s report strongly indicates. What happens now is an opportunity for those bodies to prove that they have learnt the lessons of Hillsborough. In a sense, for the past 23 years it is the people who were at the game who have been on trial. Now it is the bodies that let them down that are on trial. I hope they can prove that they are worthy of the trust that the country should be able to have in them.

5.30 pm

Lord Rennard: In this excellent and emotive debate, I wish to speak briefly as someone who is very proud to have been born and brought up in the city of Liverpool.

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My church was Holy Trinity, Wavertree, and I remember being confirmed there by the then Bishop of Warrington who used three words as the theme of his sermon that day: love, faith and courage. He was a clever bishop because he knew that many of us would remember “love”, “faith” and “courage”, spelt out by the initials LFC, our football team. It is love, faith and courage that the families and friends of the victims in 1989 have shown these twenty-three and a half years.

Liverpool people are generally proud of our city, but they are aware, too, of prejudices held against it by some who know little about it, its people and its culture. I am sure that I am not alone in fearing that elements of prejudice against the city contributed to the terrible events at Hillsborough—the false allegations that were made in some newspapers and the cover up of responsibility for 96 deaths that persisted for 23 years. Questions are still being asked. How can it have taken 23 years to get to this point? Why have police officers in the past not been compelled to give evidence in such cases until now? Is it right that evidence about the death of 96 people cannot necessarily be taken, even with these proposals, from people who have retired or resigned from the police?

People in Liverpool and across the country are right to ask why previous Governments did not act more decisively to ensure that the truth that was well known in Liverpool was made more widely known nationally? This Bill is necessary. It will help to bring about the justice sought by the families and friends of the victims over almost a quarter of a century. The families of the victims have shown great resolve and determination in the face of much opposition to exposing the truth. They lost loved ones, and saw those whom they lost blamed unfairly for what went wrong. But because of their dignified, brave and consistent commitment to the cause of justice for the 96, they are finally beginning to get answers. They are all grateful, I know, to all those who helped to establish the truth by serving on the panel led so effectively by the right reverend Prelate the Bishop of Liverpool.

The report of the Hillsborough Independent Panel has been universally accepted, although some of those responsible for the defamation of those who died have yet to accept any proper responsibility for what they said and did at the time. Some of those who colluded in decisions not to let the truth emerge have yet to explain themselves. There is now widespread agreement in all the major parties that confidence and trust in the police needs to be restored by looking carefully at all the issues surrounding how we police the police. This Bill goes some way towards addressing that question and from these Benches I am very pleased to support it.

5.33 pm

Lord Dear: My Lords, it is my privilege to try to record some new facts in this debate and perhaps to balance some of the comments that have been made today—indeed, some of the rhetoric that has been employed—and particularly to answer, if I can, some of the questions posed by the noble Lord, Lord Alton of Liverpool.

As we have heard, the disaster at the Hillsborough Stadium occurred on Saturday 15 April 1989. The following day, I was asked to support Lord Taylor in

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the investigation of the causes of that terrible event. I was then chief constable of the West Midlands Police, which, I might add, is the largest police force in England and Wales, outside London. I met Lord Taylor in Sheffield on Tuesday 18 April and he expressed his wish to begin to take evidence in public within three weeks of the disaster. We discussed what would be involved to meet that three-week timescale; a timescale that had never before been attempted in circumstances of that magnitude and, I believe, has never been attempted since. Even with the 440 police officers that I was able to deploy to that inquiry, it was obvious to both of us that some extraordinary measures would have to be taken if we were going to work to that timescale. To speed the process, he directed that we should request South Yorkshire Police to arrange for police officers who were witnesses to the disaster to write their own statements and that their force would produce them for the inquiry. On that point, more later. I should also say that the procedure did not relate to the half dozen or so officers who would later be interviewed by my team to explore whether criminal charges should be brought against them personally.

To make the position clear, those decisions regarding the process concerning South Yorkshire officers and those timescales were his. I agreed with them and since his death in 1996, in post as Lord Chief Justice, I am happy to assume full responsibility for that decision. He was required to report, if possible, before the start of the next football season; speed therefore was of the essence. We concluded together this unusual approach hardly mattered. What did matter was that witnesses should be examined in a public inquiry as soon as possible, while memories were still fresh, and it was what they said in that inquiry that mattered, not what was or was not included in their witness statements.

Working to that timescale the West Midlands team, as you might conclude, faced a mammoth task. That investigation commenced six days after the disaster on 24 April. Special police offices were established in Sheffield, Liverpool and Birmingham. A free-phone telephone number was advertised and operated on no fewer than 28 different lines, all of them manned around the clock. They received 2,666 calls. Witnesses who were interviewed and had statements taken totalled 3,777. Many of my officers who were involved in those interviews were deeply emotionally affected. We have heard of the anguish, shock and horror of those in Liverpool who were caught up in this tragedy and this affected those officers as well. Some 3,777 statements were taken and 71 hours of CCTV footage were examined in detail. An inquiry into possible criminal charges was commenced. Most of that took place in only three weeks.

Lord Taylor began to take evidence in public exactly four weeks after the disaster occurred. He sat for 31 long days and examined 174 witnesses. Only three and a half months after the disaster, he published his report on 1 August. He had many conclusions but his major ones fell into three categories. First, he found there were a number of causes for the disaster. The right reverend Prelate the Bishop of Liverpool has already referred to the fact that there were serious misgivings from as early as 1981 and Lord Taylor reported on that and what had been done—and indeed

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not done—in the interim period. He was adamant, however, that the final and most serious cause of the disaster was the failure of South Yorkshire Police to control the crowd and to ensure its safety. Secondly, he looked at the conduct of the crowd and found there were a few very isolated examples of drunkenness, but there was absolutely no evidence that Liverpool fans had contributed in any way to what had occurred on the terraces. Thirdly, bearing in mind what we are debating today, he found that the oral evidence given by 65 South Yorkshire police officers impressed for the most part in inverse proportion to their rank. As he said, with some notable exceptions the senior officers were defensive and evasive witnesses, and did not, as he put it, show the qualities of leadership to be expected of their rank.

In particular, in his report at paragraph 285, he said:

“It is a matter of regret that at the hearing, and in their submissions, the South Yorkshire Police were not prepared to concede they were in any respect at fault in what happened”.

He continued:

“The police case was to blame the fans for being late and drunk, and to blame the Club for failing to monitor the pens”.

He concluded:

“Such an unrealistic approach gives cause for anxiety as to whether lessons have been learnt. It would have been more seemly and encouraging for the future if responsibility had been faced”.

Finally, both he and the Football Supporters’ Association warmly praised West Midlands Police for the way in which the evidence had been gathered and presented at the inquiry.

So it seems a little strange, and not a little disappointing, that the hugely excellent report recently published by the right reverend Prelate the Bishop of Liverpool has been hailed as the report that finally exposed the truth when it roundly endorsed and mirrored the findings of the Taylor inquiry. It perhaps begs the question that some of the language used by the Prime Minister and others that this has finally produced justice ought to reflect the fact that Lord Taylor got to the truth 23 years earlier.

It might also reflect on the fact that Lord Taylor informally expressed serious doubts to the coroner about the coroner’s plans to limit his inquest by employing the 3.15 pm cut-off; and also that he did not agree with the coroner’s intention to have witness statements read in the inquest which effectively denied opportunity for cross-examination. He was unable to influence the course of that subsequent process, which was out of his hands, and it did not begin until several months later.

The truth was first made public by the Taylor report in 1986. As we have heard, the waters were muddied considerably, more and more with the passage of time. Immediately the Taylor report was published, the South Yorkshire Police went public—on to the attack, if you like—with a condemnation of the conclusions and stoutly maintained that the police were in the right and the Liverpool fans were in the wrong. The inquiry that will be eventually mounted by the IPCC will of course examine this aspect in detail, and especially whether attempts were made by South Yorkshire Police wrongly to attribute blame. The Bill seeks to facilitate that inquiry. I hope that we shall not have to wait too long for the results.

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By common consent, Peter Taylor was a man of rare talent. Noble Lords will understand already that I held him in high regard and respect. He was prepared to move fast to expose the truth. His report employed elegant and economical prose and it managed to cover the ground in only 71 pages. It was published a mere three and a half months after the disaster with firm, clear, unequivocal conclusions. That is exactly the same passage of time that has elapsed since the publication of the report of the right reverend Prelate the Bishop of Liverpool, and the IPCC is still scoping its inquiry and deciding on how it might begin to progress. I do not want to appear unduly critical, but I hope that we shall not have to wait too much longer for action.

On the Bill, perhaps the question at the forefront of the minds of many of us is: do hard cases make bad law? Nothing could be a harder case than the tragedy of Hillsborough. Is the Bill bad law? In some ways I think it is. The loophole that the Bill seeks to block by requiring serving police officers to attend for interview has been a small but recurring problem for investigators, on and off, for years, so why use emergency procedures to rush it through now? After all, that power will not much assist the Hillsborough inquiry by the IPCC because most of those it may wish to interview, as we have heard already, will no longer be serving. Mostly they are retired; in some cases, they are dead.

The power to require retired officers to attend interview is not sought, although one hopes that those who are approached will co-operate—and I fully concur with what has been said. Certainly I shall, if evidence is ever sought from me.

I am not sure whether Clause 2—the application of Part 2 of the Police Reform Act 2002 to old cases—breaches rules of double jeopardy. In particular, at this stage or shortly after, there have to be safeguards in place for police officers interviewed by the IPCC. The practice of sometimes interviewing an officer as a witness without first cautioning him, then using that witness statement against him in later criminal proceedings, has to change. Interviewing under caution is standard procedure for non-police officers and should be a protection afforded to the police as well. I endorse the recommendation of the Home Office Select Committee and believe that the IPCC should employ a more rigorous interpretation of the threshold set out in the Police Reform Act to ensure that it becomes the norm that officers are interviewed under caution in the most serious cases.

This is certainly a Bill in a hurry. Usually I would resist it on that ground alone, seeking more time and due process to consider the issues in depth. But having stood here and praised the approach of Lord Taylor, who identified the truth in double-quick time, I can hardly complain at another attempt to speed up the investigative process, when so much time has been wasted over the last 20 years or so chasing irrelevancies or trying to find a way through a fog of half truths and worse. So great is the public interest in Hillsborough for understandable reasons, and so important is it that this issue should be dealt with once and for all that, with some jurisprudential reservations, I support the Bill.

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5.46 pm

Lord Blair of Boughton: My Lords, I need to start by saying that I fully support the Bill. However, I have two caveats that I have already outlined to the Minister and to which I hope he will respond in a while. In asking the Minister about these two matters, I am not trying to weaken the Bill but to strengthen it. Put simply, it would be helpful if this House was to demonstrate that it understands that police officers themselves need to believe in the provisions of the Bill. They will best do that if they believe that the provisions are fair.

I was not at Hillsborough; I was not involved in Hillsborough; but I have no illusions about it. I am on record recently as describing in the Times what happened at Hillsborough as appearing,

“to be the most egregious example of deliberate dissimulation in the history of the British police”.

When I read the right reverend Prelate’s report, I felt thoroughly ashamed of my profession. So, like all noble Lords, I wish the IPCC and the future coroner well with all their efforts. I have no illusions about Hillsborough.

However, it is vital to remember that although the Bill is occasioned by Hillsborough and the tragedy and failures there, it is not only about Hillsborough. Until and unless these provisions are repealed, they will provide powers to the IPCC and other organisations working under IPCC supervision that will cover all their investigations now and in future. I need to declare a rather unusual interest: I think I am safe to believe that I am the only Member of your Lordships’ House who has been interviewed by the IPCC as a witness. I have a personal duty to try to help get this matter right for the future. I shall say something briefly about both clauses.

I do not think that there are any noble Lords with a military background currently in the Chamber but if there were, they would recognise something that I am about to say. Servicemen and women are always uneasy at being interviewed by military police. It is the same for serving police officers when faced with people investigating complaints against the police. The powers in Clause 1 compel serving officers to attend as witnesses. We seriously need to distinguish between witnesses and suspects. I am not sure that I agree with the noble Lord, Lord Dear, about strengthening the idea of cautioning all police witnesses. Remember that all police witnesses if cautioned will be told, “You are not obliged to say anything”. We want them to feel obliged to say something, so we have to distinguish between witnesses and suspects.

Lord Dear: I was not saying that all police witnesses should be cautioned, only those who are being interviewed for very serious offences, which is what the Home Office Select Committee said.

Lord Blair of Boughton: I am grateful to the noble Lord. What I took him to be saying was that all police witnesses in serious cases should be interviewed under caution. Perhaps we can agree to get the definition of that right.

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If we are talking about witnesses, it would be extremely unlikely that the Police Federation or any other representative body would be able to provide detailed legal advice to those officers, let alone a lawyer, so they will be going into the interview room accompanied only by a friend. We need to dispel the kind of uneasiness that they will be feeling. My suggestion to the Minister is that, when closing the debate, he makes clear his expectation that police officers being interviewed as witnesses by the IPCC investigators should be given the maximum disclosure of information—that is what proposed new Section 19F(3)(c) should mean.

In no way should a compelled witness have any cause to fear, as he or she enters the interview room, that he or she will be tricked. These are witnesses, not suspects. If they are suspects, they have to be treated differently. If they are witnesses, they must be treated with obvious and visible fairness. Whatever happened at Hillsborough, the men and women now serving in the police service deserve no less than that.

I entirely agree with the purpose of Clause 2. However, some IPCC investigations and those by its predecessor body can be—and have been—very long. Careers are put on hold and the pressure of such an investigation can sit at the back of the mind month after month, year after year. When, after such a long time, the investigation is finished and an officer is exonerated—if he or she is—they are largely entitled to expect that that is and will remain the end of the matter.

I therefore ask the Minister to make clear his expectations of the IPCC that the words “exceptional circumstances” in proposed new Section 28A(1), in relation to opening a closed inquiry, not only mean what they say but refer only to circumstances in which new evidence appears to have arisen or the level of public concern makes it imperative for the case to be reopened. Cases should not be reopened capriciously nor for political advantage. It is not enough for the Minister to emphasise that it is important that IPCC resources are not to be misused in this way. The majority of officers in England and Wales deserve no less than a statement today that fairness to officers is also a consideration.

Putting it bluntly, a police officer—like any other free citizen—has the right to refuse to assist the police in an investigation, but I also believe that any police officer who does so should forfeit the right to be a police officer. I want all police officers to believe that full compliance with the inquiry is their professional duty and I want their predecessors, now retired, to believe that their pride in their previous profession should also make them want to assist the inquiry. To do that, we should try to ensure that the working practices of the IPCC, outlined in this Bill, make fairness clear and obvious. I look forward to hearing the Minister’s response.

5.53 pm

Lord Taylor of Holbeach: My Lords, we are privileged to sit in this House and have been privileged today to have had the opportunity to participate in this debate. We have heard some impassioned and authoritative speeches, which have helped this House to consider this Bill, as it should do, in the proper context in which the Government have brought it forward.

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I think that all noble Lords will have been emotionally touched by the speech of the right reverend Prelate the Bishop of Liverpool. The work that he has done in trying to build a bridge between the authorities and the families has been remarkable. In a way, this is a story of the failure of the establishment to properly engage with the families, to understand the distress of those who suffered loss or were injured or, indeed, those who were just at the match on the day. I hope that we can all help remedy that by our contributions here today.

I think that I can reassure noble Lords that this Bill has been brought to the House with the purpose of expediting truth and justice on this issue. I do not pretend that it can be easy; we have seen from the history of this matter that it is easy for people to make mistakes. Clearly, however, the investigatory role of the IPCC and of the police will be essential in clearing up the fog and mystery of misinformation and in providing clarity for the future.

There have been a number of speeches. I will start with the comments made by the noble Baroness, Lady Smith of Basildon. Indeed, many of her remarks were echoed by the noble Lord, Lord Alton, in his contribution. I readily understand the concern about what happens if officers attend but do not co-operate. There is a power to compel officers to attend if it is a matter of criminal investigation. If it is a question of witness, however, there are limits to the way in which legislation can achieve this objective, as I think the Government have acknowledged. But we are seeking to do that. Compelling witnesses to speak would be an unusual power to bring into a Bill of this nature. I hope that noble Lords will accept that we do not consider it to be appropriate.

However, I said in my opening address that people who volunteer to appear would want to help this process. There is a responsibility on all of us. When he gave evidence at the Home Affairs Select Committee on November 27, Chief Constable Mike Cunningham said that where a police officer attended but refused to answer questions, he would have to consider whether the officer’s employment should continue. This sent a strong signal of how seriously non-co-operation would be taken by the chief constable. I believe that the noble Lord, Lord Blair, said that he agreed that that was the right approach.

The noble Baroness, Lady Smith, also asked whether we would be issuing guidelines to chief officers to ensure that all forces treated refusal to attend interview in the same way. We have already committed to considering whether the existing conduct regulations should be amended or made clearer in this area, and whether misconduct sanctions should apply where an officer refuses to attend an interview as a witness. If we were to make such changes, we would also amend the relevant guidelines relating to the regulations to effect these changes.

The noble Baroness, Lady Smith, also asked about where retired officers may be suspects. I can confirm that any officer, whether serving or retired—or, indeed, an officer who retires part-way through an investigation —can continue to be investigated for criminal or misconduct matters. Officers can be compelled to attend

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an interview if they are a suspect. The noble Baroness asked also whether, when officers seek early retirement, their application will be considered if this prevents them from appearing as a witness before the IPCC.

It would not be appropriate to stop an officer from retiring who had been called as a witness, not as a suspect. However, the IPCC can investigate retired or resigned officers for criminal and misconduct matters, as it can with serving officers. Therefore, the IPCC will no doubt call retired officers to provide evidence during its investigation into Hillsborough, and I believe that in the vast majority of cases these retired officers will understand the importance of this investigation and attend willingly. If the police had reason to suppose that someone was retiring in order to avoid appearing, they may well consider that as suspect behaviour. However, that would be for the police to decide, not for us or the Bill.

The noble Baroness also asked, with regard to Clause 2, about the IPCC reopening cases where there is a powerful public interest. I know that the noble Lord, Lord Blair, is also concerned about what is meant by “public interest”. If I may disentangle the semantics, public interest in terms of popular interest is of course different from public interest as seen by the Government or by the IPCC itself. It is the IPCC that will determine where the public interest lies, and that is not measured by populist interest. I hope that I have made that clear; I think that I have a clear understanding of the interest.

The “exceptional circumstances” bar means what it says. They will be only cases where exceptional circumstances are involved; indeed, one of those exceptional circumstances is where the discovery of new evidence of high significance could then lead to a case being legitimately reopened. However, the purpose of this legislation is to deal with the particular instance which we have been debating today.

It was interesting to hear from the noble Lord, Lord Alton, who was a Liverpool Member of Parliament and able to talk about the incident as it appeared to someone representing the people of Liverpool. On the discovery of documents, I can confirm that the documents which will be available to the IPCC as part of its investigation will include some which were not available to the panel, because they were discovered after the panel had reported. It is clearly essential that every document is available to those taking forward the investigation. I assure noble Lords that that will happen, so fresh discovery will reinforce the IPCC investigations.

The noble Lord, Lord Alton, asked whether witness interviews will be given to the IPCC under caution. That question was repeated by the noble Lord, Lord Blair. I should make it plain that the police issue a caution to those whom they wish to interview because they are suspected of having committed a criminal offence and therefore may be charged. However, we would not therefore expect anybody providing evidence as a witness to be so cautioned. I think that that is the only way in which I can answer that question.

As many noble Lords have pointed out, the Attorney-General has secured a hearing on the question of reopening the inquests. That was applied for yesterday

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but it is up to the courts to consider that application. We must not prejudge the outcome of this legal process and even if the Attorney-General’s application were successful, it would be for the coroner to decide how to conduct the inquest. Again, this is an independent, statutory role which the Government cannot interfere in. I am sure that all those involved will recognise the need to expedite this process. Public opinion, the pressure for the truth, will drive this through.

I appreciate that it was not possible for the noble and learned Lord, Lord Falconer of Thoroton, to stay until this point, but I shall answer his question about integration. Clearly, we are dealing with different authorities with different responsibilities, but they have a shared responsibility for providing reconciliation and truth in this matter, and, indeed, justice. The IPCC, the Director of Public Prosecutions, the Attorney-General and the coroner will all work together and the Government will work with them to ensure that they work effectively to provide an outcome. The imperative for this is understood by the Government.

The noble Lord, Lord Blair, asked about disclosure. I can be clear that disclosure of information in relation to an interview by the IPCC, or, indeed, decisions as to how to conduct that investigation, are solely a matter for the IPCC, as the independent body with oversight over the police complaints system. Given that it has that independence, it would be inappropriate for Ministers or the Government to interfere or direct the commission on any aspect of the interview process or the investigation. I hope that that helps the noble Lord, although it does not provide him with an answer. I think that we have dealt with the question of the reopening of the inquiry.

I hope that I have answered most questions; it is quite probable, given the contributions that have been made, that I have not answered them all. I will be happy to write to noble Lords on the detail but our task today is to consider the Bill. We have had an excellent Second Reading; it is an important Bill to take forward reconsideration of the way the establishment dealt with the Hillsborough disaster in the first instance and an opportunity for Parliament, at least, to play its part in addressing this issue.

Bill read a second time.

Arrangement of Business

Announcement

6.08 pm

Baroness Stowell of Beeston: My Lords, as noble Lords will see from the Order Paper, provision has been made for a short delay between Second Reading and the remaining stages of the Police (Complaints and Conduct) Bill. The Public Bill Office has not yet received any amendments for the Bill’s Committee stage but will accept any amendment tabled within the next 30 minutes—that is, until 6.38 pm. The House will return to the Bill when the Statement and the QSD have concluded—I suggest that that will be not before 7.38 pm—either to go into Committee if amendments have been tabled or to take the remaining stages formally if not.

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Northern Ireland: Recent Events

Statement

6.09 pm

The Parliamentary Under-Secretary of State, Wales Office (Baroness Randerson): My Lords, with the leave of the House, I shall now repeat the Statement made earlier today in another place by my right honourable friend the Secretary of State for Northern Ireland on events in Northern Ireland.

“I would like to make a Statement about events in Northern Ireland over recent days. Over the past week, a series of protests has taken place relating to the decision taken by Belfast City Council on the flying of the union flag. A number of these have witnessed violence, rioting and attacks on police officers. Yesterday evening a masked gang threw a petrol bomb inside an unmarked police car; a young policewoman narrowly escaped very serious injury. This is now being treated by police as attempted murder.

As I made clear in the House last Wednesday, there can be absolutely no excuse or justification for this kind of thuggish and lawless behaviour. It is despicable. We condemn it unreservedly and it must stop immediately.

I welcome the Motion passed unanimously yesterday in the Northern Ireland Assembly, which unequivocally condemned,

‘rioting and the campaign of intimidation, harassment and violent attacks on elected representatives’,

and reaffirmed,

‘the absolute and unconditional commitment of all its Members to respecting and upholding the rule of law and the pursuit of their political objectives by purely legal and political means’.

Let us be very clear. No one can be in any doubt about the Government’s support for the Union and its flag, but the people engaged in the kind of violence that we have seen in the past few days are not defending the Union flag. There is nothing remotely British about what they are doing; they are dishonouring and shaming the flag of our country with this lawless and violent activity. They discredit the cause that they claim to support. They are also doing untold damage to hard-pressed traders in the run-up to Christmas, and they undermine those who are working tirelessly, day in and day out, to promote Northern Ireland to bring about investment, jobs and prosperity.

In addition to outbreaks of violence, appalling threats have been made against elected politicians, including a death threat to the honourable Member for East Belfast. I know that the whole House will join me in expressing our complete solidarity with the honourable lady, her colleagues in the Alliance Party and all the people who have been threatened and intimidated over the past week by this disgraceful conduct. The right of elected representatives to go about their daily business without the threat or fear of intimidation is one of the hallmarks of our democracy, and these threats are nothing less than an attack on democracy in this country.

Throughout this crisis I have stayed in close contact with the chief constable of Northern Ireland. Thirty-two police officers have been injured in the line of duty during the past week, and I take this opportunity to

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pay the warmest tribute to the brave men and women of the Police Service of Northern Ireland, who once again find themselves in the front line encountering and tackling violence. They have shown themselves again to be fearless guardians of the rule of law, whenever and from wherever it comes under attack.

I received another update from the chief constable this morning. He informed me that around 38 people have now been charged in relation to this disorder. Those who are engaged in violence should be in no doubt of the determination of the chief constable and the PSNI to apply the full force of the law. Those engaged in violence should be well aware of that fact.

I have also discussed with the chief constable the threats to elected politicians. Again, I am in no doubt as to the extreme seriousness that Matt Baggott, like the rest of us, attaches to those unacceptable threats. I assure the House that the PSNI is doing all that it can to enable elected politicians to carry out their duties and serve their constituents.

For our part, the UK Government will continue to give our fullest backing to the PSNI. That is why, in the face of the deteriorating security situation that we inherited, the Government secured an exceptional additional £200 million from the Treasury reserve. We will continue to do all that we can to assist the chief constable in keeping the people of Northern Ireland safe and secure, whether from so-called dissidents or from those responsible for this week’s events.

Yet responsibility for solving the underlying issues that have led to the violence does not rest solely with the police or the UK Government. It is right that local politicians in Northern Ireland take the lead in trying to reach agreement on a way forward. In tackling these issues, I believe that everybody has a responsibility to consider very carefully the impact of their words and deeds on wider community relations.

Once again, the trouble that we have seen in Belfast and elsewhere underlines the urgent necessity of working towards a genuinely shared future for all the people of Northern Ireland. We have made it clear that, where the Executive take the difficult decisions needed to deliver that, they will have the Government’s full backing. It would be a huge lost opportunity if Northern Ireland politics were to continue to be defined by questions of identity. There is a pressing need to focus on the wider issues of the economy, jobs and delivery. The scenes of the past few days have been deplorable, but we should not let them detract from the positive progress that Northern Ireland has made in recent years.

That was highlighted last Friday by the visit to Belfast of the US Secretary of State, Hillary Clinton. She rightly pointed to the many difficult decisions taken by local politicians and the leadership that they have shown in bringing us to where we are today. I am sure that those politicians will not allow the achievements that have been made to be undermined by lawless violence of the kind that we have seen over the past week. I am also sure that this House will remain united in support of their efforts to move the peace process further forward towards a genuinely shared future for all in Northern Ireland”.

My Lords, that concludes the Statement.

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6.17 pm

Lord McAvoy: My Lords, I thank the Minister for repeating the Secretary of State’s Statement in the House of Commons and I also thank my honourable friend Vernon Coaker for initiating this Statement. I shall now repeat the response made by Vernon Coaker in the other place.

“Mr Speaker, can I thank the Secretary of State for coming to the House to make this Statement and for advance sight of it? Let me say why I and the Opposition called on her to do so. There have been eight consecutive nights of violence in Northern Ireland. A Member of this House has had her life threatened and her Alliance Party has seen its representatives intimidated and subjected to violence, and its property attacked.

Violence against the police has escalated, to the extent that an attempt was made to murder a female officer last night by breaking the window of a police car and throwing a petrol bomb inside while she was still in the vehicle. Dozens of officers have been injured after coming under sustained attack over the course of the week. Another murderous attack on the police was only narrowly avoided when a vehicle carrying a rocket was apprehended outside Derry. It cannot go on and Westminster’s voice must be heard. This violence would not be tolerated in London, Cardiff or Edinburgh, and it should not be tolerated in Belfast. A clear and strong message must be sent from this place today that says that this violence is wrong, unacceptable and without justification.

Once again I pay tribute to the Police Service of Northern Ireland for its dedication and bravery. I spoke earlier to the Justice Minister, whom I also met a few days ago in Belfast. What discussions has the Secretary of State had with him and the chief constable about resources and the police’s capacity to deal with this disorder and the continuing national security threat? What is the latest security assessment?

The homes of public representatives have been vandalised and attacked. Local councillors, who are doing their best on behalf of the communities that they serve, and their families have seen their homes targeted and vandalised. I am sure that I speak for the whole House when I say that whether we are talking about a DUP councillor in Dungannon, two Alliance councillors and their families in Bangor, or the husband of a Sinn Fein councillor in Armagh, such violence is wrong and must stop. I stand shoulder to shoulder with public representatives in Northern Ireland for democracy and against violence. When a Member of Parliament is threatened and attacked, I view it as a threat and an attack on all of us and everything we stand for.

Will the Secretary of State tell me what assessment she has made of the involvement of loyalist paramilitaries in the rioting? Does she view their actions as a threat to national security? What discussions has she had with the Prime Minister about this? Has he discussed the ongoing violence with the First Minister and the Deputy First Minister or the Justice Minister?

I know that there are underlying issues, and I am realistic about the challenges we face. I have been with unionist and loyalist political representatives to visit areas in Belfast and other parts of Northern Ireland,

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and I want to say this: honourable Members and others from Northern Ireland are doing a really difficult job in these communities, and I do not doubt their sincerity, integrity or hard work. They are dealing with frustration and anger, and they need support in helping to channel that away from violence and towards politics. I will do what I can to help, and I make that offer in republican and nationalist communities, too, but violence is never justified and it is wrong. It is damaging those communities and, until the violence stops, we cannot even begin to discuss or do anything about the longer-term issues that need to be resolved. What discussions has the Secretary of State had with political representatives about supporting work in these communities? Will she bring political leaders together to see what can be done together?

I care deeply about Northern Ireland and its people, and I know the Secretary of State and all other honourable Members do too. I think it was important today that we came together as the United Kingdom House of Commons and said that. Northern Ireland matters; it is important. I hope that we see this awful violence ended and that we can look forward to a 2013 in which Northern Ireland is showcased on the world stage as the great place it is”.

6.21 pm

Baroness Randerson: I thank the noble Lord for his response. The key point he made, which was also made in the other place, was that we would not tolerate this kind of behaviour and violence in Cardiff, London or Edinburgh and therefore we must not tolerate it in Belfast. We must condemn it strongly and insist that any issues of frustration or differences of opinion have to be dealt with and aired through freedom of expression and opinion, not through violence. There is no place for violence in a modern democracy. Northern Ireland has travelled a very long way in the past 10 to 15 years. When one looks back at the issues that the country faced 15 years ago, the progress that has been made is astonishing. It is important that we do not allow it to slip back, particularly, as the noble Lord pointed out, when 2013 offers the opportunity to bring the world spotlight on to Northern Ireland and to give it a real opportunity for economic progress.

The noble Lord referred to a number of issues. The first was the resources that have been provided. My right honourable friend the Secretary of State has had discussions with the chief constable, who regards himself as having sufficient resources. In the Statement, I referred to the extra £200 million that was given to take the PSNI through to 2015. However, there are now further discussions about any need for additional resources after that. My right honourable friend the Secretary of State is very willing to consider additional resources if it is felt that they are needed.

My right honourable friend the Secretary of State has kept the Prime Minister closely informed. The Prime Minister is extremely concerned and is in close touch on what is happening in Northern Ireland at this moment. She has also had a number of meetings and telephone discussions. She has spoken with David Ford, the Justice Minister in Northern Ireland, three times over the past week. She has spoken with the

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chief constable three times and has spoken to the MP for East Belfast, Naomi Long. I know that she—and, indeed, I—would be happy to do more if it were needed in order to ensure that people are brought together and that we bring an end to the appalling violence that we have seen in recent days.

Earl Attlee: My Lords, the whole House would benefit from short questions to the Minister so that she can answer as many as possible.

6.25 pm

Lord Alderdice: My Lords, I thank my noble friend for repeating the Statement made in another place. I would like to add our appreciation on these Benches for the dangerous and courageous work of the Police Service of Northern Ireland. We add our support for Naomi Long, whose life has been threatened as an elected representative, and for other elected representatives whose homes and offices have been attacked and whose families have been terrified and frightened by mobs that have been roaming about. Not only have elected representatives suffered, but many other people have been discomfited as well. A doctor told me today that cancer patients were not able to get to hospital because of what was going on.

There is the question of the violence, but it did not come about just with this issue of flags. It has been developing over the last number of months, with issues about Catholic churches and parades. This is clearly a mounting process with paramilitary organisations. What is most concerning is that instead of some political leaders trying not just to condemn but to contain this, it is actually being spread out to other circumstances. While the Assembly in Stormont has flown the flag only on designated days, now the whole question of the flag being flown on all sorts of other days is being raised and creating difficulties which were never there before in more than a decade of the Assembly functioning.

I am disappointed that it has taken some time for any clear guidance to come out of 10 Downing Street and the Prime Minister. I ask my noble friend why that is so. There have been no clear statements saying not just how wrong this is but how important it is for politicians not to spread the problem but to seize the problem and control it. I ask my noble friend if she could give me some reassurance that the Prime Minister and his colleagues will not merely sit at Number 10 Downing Street and be concerned, but that they will start putting pressure on political colleagues in Belfast, who are picking up on this and spreading the problem rather than containing it and closing it down. Of course, there are other issues that need to be dealt with, including difficulties for Protestant young men and their educational status in some loyalist areas. But this is not the way to deal with them. I plead with my noble friend to make a case to the Prime Minister to be more engaged.

There have recently been complaints by the Deputy First Minister that he can see the President of the United States more easily than he can see the Prime Minister of our United Kingdom. This is not a help in a situation which is beginning to spin out of control.

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Baroness Randerson: I thank my noble friend for that powerful response. He speaks with a great deal of experience of the situation. He was a prime force in the early days of the Northern Ireland Assembly. He knows only too well how difficult it is on occasion to make progress. I also thank him for his tribute to the bravery of the PSNI and to the elected representatives. I have always thought that politics in general is not for the faint-hearted, but in Northern Ireland it is certainly not for the faint-hearted. Given the progress that has been made in Northern Ireland, we almost began to take for granted that progress would carry on there. The past few days have shocked us in relation to the threats to elected representatives. The blocking of the road to the hospital was totally inexcusable.

My noble friend referred to the gradual increasing violence, which has been a general trend in recent years. As he knows so well, the flying of the flag is an issue of great sensitivity. However, the flag has been flown over Stormont on designated days, which has been accepted up to now. Indeed, the union flag has been flown over a number of council buildings throughout Northern Ireland on designated days. I have to emphasise to the House that the decision on flying the flag is a local, democratic decision. It is a matter for the councillors in Belfast and for the MLAs.

My noble friend referred to a possible delay in response from the UK Government to this situation. It is important to bear in mind that so many of these things, including the PSNI, are devolved issues. It is also important that we allow the devolved Government in Northern Ireland to make decisions and to take leadership when it is needed. Finally, it is truly important that leadership is exercised strongly and responsibly by politicians in Northern Ireland.

Lord Kilclooney: My Lords, I am a member of the Cross-Bench group.

Lord Rogan: I am a member of the Cross-Bench group.

Lord Kilclooney: He sits on the Cross-Bench group but he is not a member of our group.

Lord Rogan: My Lords, I, too, thank the Minister for repeating the Statement. Has she noticed that the Ulster Unionist Party has condemned in the strongest possible terms the harassment of and violence towards police officers and elected representatives? Anyone who engages in this illegal activity on our streets fails to understand the values that are encapsulated in the union flag. In doing what they did, they lose the very argument that they want to promote.

Does the Minister agree that it is not sufficient to condemn the violence? One must look at the underlying causes which triggered this violence. It is not just the removal of the union flag from Belfast City Hall where it had flown continuously since 1906. It is about a people who feel that bit by bit they are having their Britishness stripped away from them. It is also about a people who perceive themselves as becoming second-class citizens in their country. These are deeply held beliefs, whether they are real or imaginary. The Government must recognise them and begin to address them.

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Police officers who were simply doing their duty of protecting the community under extremely difficult conditions have been subjected to outrageous attacks. Rather than being attacked, these officers deserve our thanks and support for standing between us and anarchy.

Baroness Randerson: I thank the noble Lord for his comments. He refers to the underlying causes. I would point out that culture changes and identity develops over a period of time. Indeed, the people of Northern Ireland have seen considerable development in their political culture in the past few years. I would also like to point out the association between the violence and the areas where there is social deprivation in Belfast in particular. That is why it is so tragic. Every time a picture on television of rioting in Northern Ireland crosses the world it does economic harm to Northern Ireland and hits its opportunity to develop a better world, particularly for its young people.

Lord Mawhinney: My Lords, does my noble friend recognise that she was right to point out that that what is happening is an attack on democracy? I am sure she carries the whole House with her when she says that. Although we are all shocked, we ought to be mildly encouraged that there have been previous attacks on democracy in Northern Ireland, and the people stood firm and good people prevailed—and, if I may say so, Ministers stood firm, and progress was made. We need to remember that in these difficult days. Does my noble friend also recognise the truth of part of what the noble Lord, Lord McAvoy, said? Those who participate in this violence, or at least some of them, think that by doing that they can force their political agenda. Will the Government make it clear that violence will never force a political agenda and that the political agendas that have already been discussed and need to be addressed, including questions of ongoing identity, cannot be addressed in the context of a response to, or as a consequence of, the threat to democracy that this violence constitutes?

Baroness Randerson: My noble friend makes some important points. It is important that we make it absolutely clear that the leadership in Northern Ireland and the Government in the UK will stand firm and show the appropriate leadership. Of course, there are always issues to be addressed, and the way in which the Northern Ireland Executive have attempted very successfully to work together to overcome huge divides on occasions has always been a great example to us. It is important that political leadership at every level in Northern Ireland shows that.

Lord Dubs: My Lords, those of us who had some involvement with Northern Ireland over the years must feel particularly dismayed and disappointed by the events of the past little while. By chance, on the day when the troubles began in Belfast City Hall, I was attending a small meeting with Naomi Long when she predicted what was going to happen—and it was a very depressing occasion. She is a remarkably brave woman, given all the threats to her. It is particularly disappointing that it is a month ago that the Irish

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Prime Minister went to Enniskillen on Remembrance Day and the Deputy Prime Minister went to a similar ceremony in Belfast. These were very important and positive gestures, which did not get much publicity at all in Britain—but they were very significant in terms of the Irish Government trying to play their part. That is a long way away from these very disappointing events.

I do not want to excuse violence, and it is not excused under any circumstances. If it was direct rule, I would ask the Minister this very positively. I am a member of the British-Irish Parliamentary Assembly, and some years ago we produced a report on the life chances for young people in some of the most disadvantaged parts of Belfast. One could see something of this sort coming, with young people, particularly from the Protestant areas, being prey to loyalist paramilitaries because they had no other future in life at all. I am afraid that that report was ignored. I urge the Government to talk to Northern Ireland Ministers and say that they must not neglect things like poor life chances for young people. In those poor life chances, we see the seeds of some of the events that have happened. It does not excuse them for one second—it does not excuse them at all. But we have to understand that and see what can be done in the longer term.

Baroness Randerson: The noble Lord makes some important points and draws our attention to what are sometimes stunning symbolic examples and positive gestures by political leaders in the island of Ireland as a whole. When I was in Belfast last week, I was very impressed by the determination of the First Minister and Deputy First Minister to develop the economy of Northern Ireland. I also had a meeting with Invest NI, which is doing excellent work on inward investment. It is key that that investment trickles down to those socially deprived areas where problems such as we have seen in the past week particularly occur.


Lord Carlile of Berriew: My Lords, I declare an interest arising from two appointments connected with security in Northern Ireland. Will my noble friend join me in respecting the dignified way in which David Ford has conducted a very difficult job—as difficult as any ministerial appointment on this side of the water—as Minister of Justice in Northern Ireland? Secondly, does she agree that the evidence is that what has happened is a threat to public order but not a threat to national security? The vast majority of the public in Northern Ireland, whichever religion or part of the community they come from, are absolutely hostile to the sort of public disorder that has occurred in recent days and wish strongly that the hooligans who have been committing the acts that have been described would simply go home and stop.

Baroness Randerson: My noble friend has introduced two important new topics. One is the excellent way in which the Justice Minister, David Ford, has gone about his work. I met him as well last week and, having met him several times in the past, I was yet again tremendously impressed by his determination and the clear and even-handed way in which he approached his task. On the issue of whether it is a threat to public order or a threat to national security,

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I would agree with my noble friend that the latter definition has not yet been reached. The important thing is that, however you define it, it is wrong and it must be condemned on all sides.

The Lord Bishop of Bath and Wells: My Lords, may I also express, from these Benches, our abhorrence at the violence that has been experienced in Northern Ireland, pay tribute to the PSNI for the work that it is doing and encourage the bravery of its officers? I have been involved in Northern Ireland for many years: I have been married to an Irish woman for 45 years and have been engaged in various different aspects of the progress towards peace during those years. One thing that has impressed me, and continues so to do, is the work being done by grass-roots groups in communities. These are very often people who have been involved in acts of violence themselves and have come to a new place in their experience. As we look at this particular situation and circumstance, I encourage the Minister to nurture those grass-roots groups that are endeavouring to form and make peace within the communities and which are, very often, aware of the various participants in these situations and can themselves be the means by which some of the violence is reduced.

Baroness Randerson: My Lords, the right reverend Prelate makes a very important point about the voluntary sector. We all know that the voluntary sector is important to our society throughout the United Kingdom, but nowhere more so than in Northern Ireland. The work of some of the community groups to improve a sense of security and belonging is absolutely astonishing. It is of particular interest how many community leaders have had an association with violence in the past in Northern Ireland and have seen that it is the wrong way to go.

Lord Glentoran: My Lords—

Noble Lords: Cross-Bencher!

Lord Kilclooney: My Lords, I think it is the turn of the Cross-Benchers, and I am a member of the Cross-Bench group. As one who suffered intimidation and was shot 10 times through my body by the IRA, I totally deplore—and have every reason to deplore—attacks on politicians of any party in Northern Ireland. Secondly, the Minister may have given a wrong impression about what is happening in Northern Ireland. We have had more than 50 demonstrations in the last week in Northern Ireland and many of them have been totally peaceful and well organised. That was not said. The impression given was that there were riots at all these demonstrations. We had five demonstrations in my home city of Armagh last night. They were well organised and very civilised.

It was mentioned that the honourable Member for Belfast East foresaw the violence. The reaction was caused when Sinn Fein and the SDLP, joined by their colleagues in the Alliance Party, decided to lower the union jack for 350 out of the 365 days of the year. One of that team said, “We have done a good day’s work”. That really inflamed opinion among the majority community in Northern Ireland and a vast minority within the City of Belfast. Would that group who

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decided to lower the union jack in Belfast have been better to delay their decision until January and not damage the retail shops in Belfast in the run-up to Christmas?

Finally, I bring the Minister good news. We had our census figures in Northern Ireland today. First, some 45% of the population are Roman Catholic, but now only 25% say they are Irish only—proof that sectarianism is fading. Secondly, 59% now hold a United Kingdom passport, while only 21% hold an Irish passport. In the United Kingdom, the union flag is the flag of Scotland, Wales, England and Northern Ireland; but Scotland, Wales and England also have their own local flags. Would it not be a good idea, given that flags are a divisive issue in Northern Ireland, to put our minds together to get a flag—as well as the union jack—to which Roman Catholics and Protestants, unionists and nationalists, and anyone can give joint loyalty? So far, we have no Northern Ireland flag. Is it not time we started to design a flag that would appeal to everyone?

Baroness Randerson: I thank the noble Lord very much for his comments. I freely and fully acknowledge that there have been a significant number of totally peaceful demonstrations in the past week. Unfortunately those people are overshadowed by those who decided that they wanted to provoke violence. The right to demonstrate peacefully is the core right of our democracy. That is absolutely accepted on all sides.

The timing of the decision on the flag on Belfast City Hall was a matter entirely for Belfast City Council. As for the noble Lord’s point on sectarianism, I join him in the hope that Northern Ireland politics will be less marked by sectarian differences in the future. He makes an interesting point about a new flag for Northern Ireland—one that I am sure will be well aired, now that he has raised the matter here. It is bound to be discussed with interest. I come from Wales and we talk a lot about the Welsh flag and the place of Wales in terms of the union jack. I can therefore understand the significance of a new flag, which could be an interesting option for the future.

Earl Attlee: My Lords, before we start the Question for Short Debate, I remind noble Lords of the speaking times. Except for the right reverend Prelate the Bishop of Derby, who has 10 minutes, and the Minister, who has 12 minutes, all speeches are limited to four minutes. I will be able to help noble Lords.

Developing Countries: Impact of Multinational Companies’ Financial Practices and UK Tax Policies

Question for Short Debate

6.49 pm

Asked By The Lord Bishop of Derby

To ask Her Majesty’s Government what assessment they have made of the impact of multinational companies’ financial practices and the United Kingdom’s tax policies on developing countries.

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The Lord Bishop of Derby: My Lords, I am very glad to have secured this debate on what has come to be known as tax justice. The point is to ask Her Majesty’s Government what assessment they are making of the impact of the policies of multinational companies in terms of taxation, the effect that that has on developing countries, and the impact of our own tax policies on developing countries. They are the issues that I am inviting your Lordships to discuss.

I declare an interest. I am a trustee of Christian Aid, which does a lot of work in this area. I put down for this debate a long time ago and suddenly it has become very topical, with Starbucks, Amazon and others bringing it to the fore. That should remind us that we are talking about citizenship—corporate citizenship, in this case. People recognise that as individuals and companies create wealth and income, it is only right that a proportion of that should be invested in the country in which it is created for the well-being of its resources and development.

We know that in our own country the cost of health, education and infrastructure is high and very difficult to maintain so everybody should make a contribution. That is why there is such an outcry about Starbucks and other companies. In developing countries, the need for those basic things is much greater. As rich countries are getting richer, poor countries are getting poorer. Therefore, the need for health, education and very basic infrastructure is enormous. It is estimated by Christian Aid and others that developing countries, through not collecting tax revenue that they might be expected to collect, are losing something like £160 billion a year. That is more than the whole flow of international aid into developing countries. The figures can be debated and disputed, but the point is that the scale of the loss of revenue through taxes not being paid in developing countries is massive at a time when there is enormous social need.

We should not be surprised that the Chancellor himself says that tax justice is a moral issue. We should not be surprised that concern comes from these Benches because, in the Christian tradition, Jesus and Paul make it very clear that there is a duty to pay taxes to contribute to what we would call the common good and the common life. Each country needs the resourcing to provide a common good and a common life. What happens is that multinational companies are able to create wealth in developing countries, but then shift the wealth often to secret tax havens and other locations, making very little contribution to the needs and resourcing of the country where the wealth is created.

There are a number of key issues that I want to offer to frame this debate. The first is about corporate citizenship. What is the moral duty on organisations and companies that gain wealth from being in a particular country if they shift it away to other places to minimise their tax payments and the wealth that was created does not contribute to the society that created it? Secondly, surely it is in the interests of multinational companies in developing countries to have more stable structures and a better health and education provision for the workforce, so that the businesses they are trying to run are better resourced. It would seem to

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be sensible for multinational companies to contribute more to the better infrastructure and resources of developing countries.

Thirdly, it must be in the interests of companies working in developing countries, and of our Government, that these countries are resourced well enough to be stable politically, economically and socially, because poverty creates instability. For companies operating in a country, and for Governments like ours, we want to encourage a resource base that allows stability and security. An increasing number of people in our society think that tax justice is a very high priority as a moral issue. In a recent poll, 58% of people in this country want tax justice to be recognised as a moral issue. The Prime Minister himself has said that as we go into the G8 next year he wants tax justice to be an important issue. People are recognising it as an issue. The question is: what are we going to do about it?

Within Parliament, the International Development Select Committee, which is a cross-party grouping, has recently produced a report about tax resources needing to be paid in developing countries to combat poverty, promote stability and create better conditions for business. The committee makes a number of specific recommendations which highlight what we could be doing and what we could be contributing towards. The first recommendation is that we should support country-by-country accounting for greater corporate transparency. In each country, we should try to gain information about profits, the payment of tax and where money is coming from. The second recommendation is that there should be an improved exchange of tax information. Many developing countries do not currently have the civil service infrastructure to gain this information or even to ask the questions that might help them discover what is going on. As we can develop information from companies that have their headquarters here then we might have information that can help other Governments. Many developing countries have multinational companies within them that are subsidiaries of major companies based in this country and in the City of London. We would therefore be in a position, as we gain more information and transparency about the movement of money and where tax is paid, to share it with other Governments. Thirdly, besides a new country-by-country accountancy for greater corporate transparency, besides improved exchange of tax information, the committee recommends that in our own tax practices we assess as we make policy the impact they will have on developing countries.

The Government have accepted the recommendations about capacity building in developing countries to handle matters of tax better but they have yet to give a clear steer on their response to the recommendation about the exchange of information that would help developing countries better perceive the wealth that is being created and ask for a proper share of it. I have a major concern that we are developing bilateral conversations with countries such as Switzerland about exchange of tax information. That may be helpful in the short term on some fronts for us domestically but it is creating agreements from which developing countries are excluded. It therefore makes it more difficult rather than easier for developing countries to

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know about the wealth that is being created within them and any tax revenues they may be able to claim a share of.

I welcome the fact that in 2013, through the G8, our Government are going to take a lead in this area. I welcome the Government’s commitment to reaching the 0.7% aid target. However, I want to offer two perspectives to frame this short debate. The first is the point I made about corporate citizenship. Many subsidiaries of companies that operate and extract wealth and resources from developing countries have a base in the UK. If we develop a sense of transparency here then our corporate citizenship that these companies must be challenged to step up to must include a governmental approach to citizenship that shares that information.

My second strand comes in the form of questions to the Minister. Will the Government consider provision in UK tax policy to assist developing countries to collect the taxes that they might be due? Would a Treasury Minister be willing to meet a delegation of interested people from this House and other agencies so that we can look at the impact of our tax policies on developing countries? What concrete steps will the UK Government take to tackle secrecy and the lack of transparency which allows this huge outflow of wealth and stops countries getting the deserts that they might claim? Finally, what steps will the Government take to consult global civil society, including the churches, to gather intelligence, recognise needs and see how they can be put together?

I look forward to contributions to the debate.

7 pm

Lord Brooke of Sutton Mandeville: My Lords, the whole of your Lordships’ House is in debt to the right reverend Prelate the Bishop of Derby for securing and launching this debate. If I follow him in telegraphic mode it is because four minutes is a tiny span given the complexity of the debate’s subject. I also welcome my noble friend the Minister to these matters, which respond well to his past experience.

The coalition Government have fundamentally changed the basis of UK tax in this area. Previously we used at least to seek to tax UK-based companies on their world-wide profits, if sometimes with variable success. Now we have moved to a territorial tax system so that only profits arising in the UK are HMRC’s target. The logic of this is not the subject of this debate but it is a salient background point. If profits arising in Africa, Latin America or elsewhere are no longer in our purview and we make no claim on them, it will cost us little to help such countries to collect the taxes owed to them and we potentially make our own aid giving more effective in the process. In this regard, justice marches hand in hand with national and international interest.

The right reverend Prelate alluded to building a tax capacity in the third world, and both DfID and HMRC do valuable work in this area. I hope we can extend this to enlarge DfID’s own tax capability. This would promote DfID reinforcing the Prime Minister’s clear intention that tax should be at the centre of his agenda for the G8 next year. In the mean time, I hope that

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the Minister in his wind up will give examples of current tax help that we are bestowing on developing countries.

For this intention to work, we need to ensure that we go beyond finding solutions that work for ourselves and more widely for the G8 and find solutions that work for all countries. If due and proper revenues are effectively raised by developing countries, then present desperate poverty can, in part, be assuaged to the mutual benefit of all. The G8 conference can be an opportunity for the rest of the G8 and ourselves to make a pellucid commitment to developing countries that we shall put our own houses in order to prevent our structures being used to evade tax in developing countries, and that the G8 will use its power and influence to persuade others to change as well. It is a good and honourable cause and we should be grateful to the right reverend Prelate for having raised it.

7.02 pm

Lord Browne of Ladyton: My Lords, I am delighted to follow the noble Lord, Lord Brooke of Sutton Mandeville, whom I have admired for almost two decades. I am impressed by his ability to use only two of the four minutes that he was allocated and yet to have made such piercing points. I join him and others in the debate in congratulating the right reverend Prelate on securing the debate, identifying exactly the right theme in his introduction and short contribution and on asking some very pertinent questions. The timeliness of this debate is set by the discussion which is taking place loudly outside about corporate citizenship in this country and the avoidance of taxation by a number of well identified companies. Disturbingly, it would appear to be a growing list as this debate ensues.

The debate is timely also because our Government have a conjunction of opportunities in 2013 to address these and related issues. In 2013 we take the chairmanship of the G8; we are the co-chair of the Open Government Partnership; and we are, as we have debated previously, the chair of the high-level panel on post-millennium development goals. So the conjunction of these, plus G20 opportunities, creates an opportunity for multinational action that has not previously been there.

We are encouraged by the Prime Minister’s approach to this. In the Wall Street Journal on 1 November, David Cameron published an article in which he identified combating corruption—which is the overarching issue here—as part of the golden thread of conditions that enable open economies and open societies to thrive. He has in the past repeatedly emphasised the role of transparency, while he aims to lead a Government that is the most transparent and open in the world. So we have a Prime Minister and a Government who ought to be focused on these issues.

I agree entirely with all the points that the right reverend Prelate has made and have been made before, and I am sure that I will agree with many of the points that are focused on tax transparency and accountability. In the next two minutes, I will give an expansive interpretation of the Motion before us to draw the House’s attention to opportunities that lie in improving corporate social responsibility by multinational companies in the areas both of the extractive industries and in relation to corruption to expand upon these challenges.

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Some 3.5 billion people live in countries rich in minerals. Very few of them are enriched by the extraction of those minerals from their countries. In the All-Party Parliamentary Group on Anti-Corruption only last week, we were treated to an explanation of what has happened to the mineral wealth of the DRC. It has been traded for a fraction of its value to companies in our overseas territories, the beneficial ownership of which appears to be not very far away from senior politicians in those countries. There is a need for transparency in this direction and I congratulate the Government and the European Union on engaging in this and trying to bring our laws up to speed with the United States’ laws on transparency of payments to governments. I ask them to ensure that the return that we get for that investment is a proper directive which is influential all across Europe.

Again on transparency and enforcement, the Bribery Act 2010 offers an opportunity to try to interdict this sort of behaviour. If we are to do that, first, we need it to be applied to all legal persons incorporated in all of our overseas territories and crown independencies; I have already identified some of the reasons for that. The OEDC has asked us to do that; perhaps the Minister is able to indicate when we are able to do it. Secondly, we need adequate resources to enforce the Act. Thirdly, the Ministry of Justice guidance needs to be more focused on these issues. Fourthly, we need to appoint some champion in government for anti-corruption. All these things are necessary.

I want in one sentence to make one other point. None of this behaviour in the United Kingdom would be possible if it were not for the behaviour of people called “enablers”. Embarrassingly, as a lawyer in the United Kingdom, most of these people are professionals. They are lawyers, accountants, bankers and finance people. Our regulators in this area must be made accountable. When was the last time that a member of one of these professions was struck off for behaving in this way?

7.07 pm

Lord Shipley: My Lords, I, too, thank the right reverend Prelate the Bishop of Derby for initiating a very timely debate. The current debate on the payment or non-payment of corporation tax in the UK shows that it is a tax that does not work well for the UK, so it is unsurprising that it is not working well for developing countries either. We know that developing countries lose significantly more from lost tax revenue than they receive in international development aid.

In a debate on 22 October in your Lordships’ House on the Economic Affairs Committee’s report on the economic impact of development aid, I raised the claim of ActionAid that British multinationals were directing profits into tax havens from developing countries to the value of around £4 billion—or one-third of the UK’s total planned development aid budget. The Government have subsequently challenged that number. While there may be disagreement on a precise figure, there is common acceptance that the money leaving developing countries owing to tax evasion and avoidance far exceeds the amounts received in aid. In fact, the OECD has estimated that it may be up to

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three times higher. Christian Aid has estimated that developing countries as a whole lose some $160 billion a year in lost revenues from multinational companies.

We have a clear responsibility to help developing countries. It is not just a question of increasing our spending to 0.7% of our national income. The UN, the IMF, the World Bank and OECD all emphasise that developed countries have a responsibility to undertake spill-over analysis where changes in domestic policy may impact on developing countries. We should welcome the fact that DfID is investing in helping developing countries collect more tax revenues. I have been wondering which Whitehall department is responsible for this matter. Should DfID or the Treasury address where tax is taken? I would be very grateful for the Government’s view on where the responsibility lies between DfID and the Treasury.

I know that the Government are active internationally in promoting tax transparency and the exchange of information between jurisdictions, but I wonder if they are doing all they could in this area. For example, recent reforms to UK-controlled foreign companies rules mean that we need to assess urgently how we can better support developing countries’ tax systems. It would be helpful if the Minister could confirm what action is planned by the Government to address this.

If we want to help ourselves and developing countries alike, we should now be demanding real reform of corporation tax so that profits are paid where they are really earned, including mines and wells in the case of many developing countries. If we could find a way to allocate the profits of international companies on this basis, the money could be so much better invested.

The recent outrage in the UK will, I hope, prompt decisive action, but this action cannot be simply for rich countries. We need reform that works for all countries. If we want our aid to be effective, we cannot undermine it by allowing tax revenues to be transferred out of developing countries.

7.11 pm

The Lord Bishop of Hereford: My Lords, I, too, begin by congratulating my friend and colleague the right reverend Prelate the Bishop of Derby on securing this debate at such a timely moment.

The 19th report of the House of Commons Public Accounts Committee, published only a few days ago, began:

“Transparent, predictable and fair taxation is at the core of our public finances. The Government has a responsibility to assess and collect tax due from all taxpayers, without fear or favour, and taxpayers should pay all that tax which is due”.

It continued:

“The hearings we held showed that international companies are able to exploit national and international tax structures to minimise corporation tax on the economic activity they conduct in the UK. The outcome is that they do not pay their fair share”.

This is all familiar to us, but if that is true for the United Kingdom, it is even more so for developing countries.

The key issue with regard to collecting any tax—unless it is from the extraction companies, to which reference has already been made, where it may be the outcomes that we need to be looking at—is finding the profits on

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which it is due. You can have the best tax law in the world, but if you cannot find the profits, it is all a waste of time. That means that the first and most important job for developing countries is to identify profits that should be declared in their countries but are not.

There are three ways in which we can do this. We can call for the introduction of country-by-country reporting that requires a multinational corporation to publish a profit and loss account for each and every country in which it trades. We can also voluntarily supply to developing countries information, obtained here in the United Kingdom, on the tax affairs of multinational corporations based in this country, where that information suggests that developing countries have tax issues that they might want to raise with those companies.

Changing our disclosure of tax avoidance schemes rules to include developing countries, not just the UK, as well as potentially high-risk transactions, could greatly assist. It would enable the UK to provide valuable, targeted information to developing countries to help them to both enforce their existing laws and identify and improve their legislation, just as DOTAS has here in the UK.

Lastly, we can ensure that if in future we collect information from tax havens—as it seems that we are likely to do with the Isle of Man and, I hope, others—on who beneficially owns companies in places such as the Crown dependencies that would be of benefit to developing countries, we should send that on as well, although this should be only a stepping stone to ensuring that all countries have access to information, not just the United Kingdom and other richer countries. The United Kingdom should work proactively to ensure that jurisdictions offer developing countries the same access that they grant to the United Kingdom itself. All of this needs not only action here but, ideally, international agreement to act in this way, especially from the G8. The relationship between multinationals and developing countries is skewed by the wealth, influence and power of the former, which makes it extremely difficult for the developing countries themselves to challenge them legally or financially. We need to act to redress this balance, and improving the information is a vital step in that direction.

7.16 pm

Lord Haskel: My Lords, I also congratulate the right reverend Prelate the Bishop of Derby on this debate. He really has caught the spirit of the times; the spirit that, nowadays, business plans have to stand up to scrutiny socially and ethically as well as commercially and financially. Be good corporate citizens, as he put it. Not only is it reasonable to pay tax where people work, where the infrastructure and facilities are provided and the business is done; but also, avoiding the tax puts the local firms who pay their fair share of tax at a disadvantage.

It is fair to ask, “What is it to do with us?” All this happens an awfully long way away, over the water somewhere. However, it does concern us because London is the place where a lot of these tax-avoidance schemes are thought out and prepared. The right reverend Prelate the Bishop of Hereford just reminded us that

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there is often no relationship between the consolidated accounts and the tax accounts prepared by firms here in London. Committees in both your Lordships’ House and another place have drawn this to our attention, and so did my noble friend Lord Browne. In addition, some firms that use these procedures are controlled here in London. Your Lordships’ Select Committee has also told us that many of these tax schemes are prepared and sold by the big four accountancy firms based in London—the very firms employed by the Government as consultants. Will this form part of the Chancellor’s consultation about honest tax payment being a condition of getting a government contract? For overseas companies, London is quite often a tax haven, alongside the better known ones in Alpine meadows or on islands tropical or not so tropical.

Incidentally, many of these islands are controlled by the UK. Why can we not close down these activities, which deny the Chancellor legitimate tax? Today we are getting the draft Finance Bill. I am sure that the Minister is familiar with its hundreds of pages. Can he tell us, therefore, whether the promised general anti-avoidance rule will draw a line under this activity? Will the Finance Bill have an effect, or are more up-to-date international rules needed to put a stop to this, such as the unitary tax system described by the noble Lord, Lord Brooke?

It would be a big step to get the G8 to agree to this. Meanwhile, as the right reverend Prelate said, we have to rely on morals and society; on good corporate citizenship. However, there are glad tidings. The good news is that the right reverend Prelate has an important ally, perhaps even better placed than the Prime Minister, who has referred to these activities as immoral. I speak of the Mayor of the City of London. What caught my attention when Roger Gifford became the 685th Lord Mayor of the City of London was that he went to my old school—no, Minister, it was not Eton. So I was interested to hear that he has chosen “the City in society” as the theme for his year in office. I quote him:

“Unbridled capitalism is something none of us believe in but it’s how to bridle it and yet leave room for growth, entrepreneurship and job creation”,

was how he described his task, and that is what he set out to do. I found that pretty inspiring and brave so, when he was interviewed on the “Today” programme on the day of the Lord Mayor’s show, I listened with interest. He spoke about how his efforts are to be directed towards the City reaching a newer and healthier capitalism. Truly, I wish him every success, and may part of that success be shared with the right reverend Prelate, working on his important campaign. As I have tried to point out, the Government can do a lot to help, and I hope that they will.

7.20 pm

Lord McKenzie of Luton: My Lords, like others, I congratulate the right reverend Prelate the Bishop of Derby on introducing this debate and I welcome the manner in which he did so.

I was not going to speak in this debate but I was prompted to do so because I was recalling a largely happy time in the mid to late 1990s when for a couple

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of years I had responsibility for leading a practice of a major accounting firm in Vietnam. We had offices in Ho Chi Min and Hanoi, and we lived in Ho Chi Min. My observations today are not meant in any way to be a criticism of those incredibly resourceful people but are an anecdotal recollection of the tax challenges of a country at an early stage of the opening of its economy to international investment.

In common with a number of countries at that stage in their development, it had no embedded concept of international accounting standards and, at best, a rudimentary set of tax rules applicable to foreign investors. Not surprisingly, there was no broad understanding of the international tax environment, or indeed of international auditing standards, and the issue of corruption, to which my noble friend and others have referred, was a challenge. In these circumstances, the need for capacity-building was paramount and continual. We certainly saw it as part of our obligation to engage in training sessions for the Ministry of Finance, but there should be a continuing government programme of secondment into the local revenue authorities and transfers and secondments out to more sophisticated regimes.

Experience on some major auditing assignments, which were funded by money from the World Bank or, in another case, the Asian Development Bank, would have been easier had the requirements to have training been more tightly prescribed. Having to have uncomfortable negotiations with a few people who wanted an international study tour, rather than several hundred of their middle-ranking people having good-quality training, was a disappointment at best.

In Vietnam, foreign investors had to be licensed. You could do business either by way of a wholly foreign-owned enterprise or a joint venture with a local partner, depending on the sector and technology transfers. Some sought an in-country presence by way of a representative office, which should have precluded them doing business there although often, sadly, it did not. The concept of aiding transparency by having separate local accounts is to be supported, although there are issues where the business is a joint venture and a local partner, possibly an arm of government, that may be less welcoming of the concept. Having a requirement to identify related party transactions in accounts is also to be strongly supported, but it is not a panacea.

Transfer pricing, or the inflated pricing of goods or services from connected companies, is a challenge the world over, and the opportunities for companies to unbundle their products, sometimes stripping out a royalty flow, is a challenge as well. The IMF points out that developing countries signing up to sophisticated OECD-type tax treaties that generally seek to lessen the tax costs on interest, royalty and dividend flows may not be in those countries’ best interests when there is a large imbalance of such flows between two territories.

Vietnam, like a number of other developing economies, has gone down the path of adopting a VAT system. It was in the process of doing this at the end of the 1990s. As a source of tax, of course, it is not reliant upon the

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computation of profit and the vagaries of that process. A VAT system can be supportive of exports, although it may not always be progressive. Notwithstanding that, developing countries need a profit or corporation tax also, but one which is based on clear rules and where the fuzziness of the law does not lead to tax liabilities being negotiated. The risks are obvious even for a Starbucks. Also, taxation of individuals should not be overlooked. There can be a huge differential between local wages and expat salaries. The latter are often bolstered by accommodation and tax protection packages. For some, the temptation to split contracts and park some remuneration offshore may be too great. Requiring more vigorous reporting on such arrangements opens the way for local officials to challenge this.

These are a few anecdotal comments from the coal face of a developing economy and the challenges that it faced.

7.25 pm

Baroness Royall of Blaisdon: My Lords, I, too, offer my congratulations to the right reverend Prelate the Bishop of Derby on the superb timing of this important debate and on his excellent introduction, with which I agreed.

In recent weeks, high-profile cases of multinationals avoiding taxes have attracted real anger, both from the public and politicians. When families and businesses are squeezed and living standards are falling, it is right that we expect everyone to pay their fair share. Corporate citizenship is a good concept. While we should not taint all businesses with the same brush—most of our businesses make a significant contribution to the UK economy—this phenomenon is not restricted to a few multinationals. According to ActionAid, of the 100 biggest FTSE companies, 98 use tax havens. This suggests that tax avoidance is a systematic feature of the way in which many large companies operate, rather than an occasional one-off.

Tax avoidance has a devastating effect on developing countries. As noble Lords have said, the OECD estimates that developing countries lose three times more to tax havens than they receive in aid. This has the effect of depriving developing countries of a much-needed, sustainable source of revenue, taking money away from essential services, restricting growth and preventing Governments investing in crucial infrastructure. Tax avoidance must be at the centre of future aid policy. Indeed, in its report published in August, the International Development Select Committee stated:

“Tax is an issue of fundamental importance for development. If developing countries are to escape from aid dependency, and from poverty more broadly, it is imperative that their revenue authorities are able to collect taxes effectively”.

An expanded tax-revenue base is one of the only ways for developing country Governments to develop a sustainable source of revenue to deliver social programmes and target poverty and inequality. Of course, as has been said, poverty and instability go hand in hand too often.

The successor to MDGs, and to the future of development must be values-led, with the goal of tackling inequality at its heart, and this must include tax avoidance. Labour in Government made progress on this issue

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but not enough. For example, in 2002 we launched the extractives industries transparency initiative, which has been mentioned and which promotes revenue transparency at a local level, but much more needs to be done. We pledged in our 2010 manifesto to take further action and we are now launching an anticorruption review with the Mo Ibrahim Foundation to build a strategy that will aim to deliver a strong, global anticorruption coalition.

The Finance Bill 2012 introduced a relaxation of the Government’s anti tax haven laws; the so-called controlled foreign companies rules. Under the current rules, if a UK company reports profits in countries with lower corporate tax rates than the UK, the UK Government can impose an extra tax charge on the company to make up the difference. Under the revised rules, however, the UK will only be able to impose this extra charge if the profits have been moved out of the UK. Profits moved out of a developing country and into tax havens will no longer incur the charge, providing a greater incentive for companies to shift profits into tax havens. This move was strongly criticised by a number of NGOs, as allowing multinationals to avoid paying taxes in developing countries.

In its recent report, Tax in DevelopingCountries: IncreasingResources forDevelopment, the International Development Select Committee stated that the revised rules,

“will incentivise multinational corporations to shift profits into tax havens. This is likely to have a significant detrimental impact on the tax revenues of developing countries”.

The committee recommended that,

“the Government should conduct … an analysis of the likely financial impact”,

of the CFC rules on developing countries and, depending on the outcome, should consider dropping its proposals. However, the Government rejected this recommendation on the grounds that the measures were intended to benefit the UK economy and that such an assessment would not be feasible.

During the passage of the Finance Bill, Labour urged the Government to reconsider changes to the CFC rules and tabled an amendment but the Government pushed ahead—despite advice to the contrary from NGOs, the IMF, the OECD and the World Bank. Will the Government urgently review the CFC rules? Could the Minister also tell the House what the Government are doing now, following the lost opportunity of the Finance Bill, to promote responsible capitalism?

Tax avoidance is a moral and an economic issue. With the G8 and the discussion about the new MDGs, there is an excellent opportunity to bring this issue to the fore and find a global solution. I would strongly urge the Government to take heed of the wise advice given this evening and stand up for social justice and responsible capitalism, at home and abroad.

7.31 pm

The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Lord Marland): My Lords, I, too, extend my thanks to the right reverend Prelate for initiating this debate. As all noble Lords have said, the debate is at a very timely moment where this is very much in public debate. It is important that

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this whole debate started from the moral standpoint, because that is the key to where we can go. With moral leadership, we can make great progress.

I would just take issue on a couple of points that the right reverend Prelate and the noble Lord, Lord Shipley, raised. We do not recognise the figure of $160 billion; in fact, we are thinking that if it was a man called James Henry who produced that figure, perhaps he should come and help us out in the Treasury. The right reverend Prelate also made the point that some rich and some poor countries are getting poorer, but in fact a lot of poor countries are getting richer. I have seen that first-hand in Mozambique and in Angola—and in Vietnam, which has been getting much richer even if it is getting a bit poorer at the moment. It is not just the picture as he painted it.

We must not forget that multinational companies are nation builders. I look at places such as the Middle East, where great British oil companies have established themselves and helped to create a country—as they have in Nigeria—and helped to create the wealth of that country in an incredibly responsible way. I do not particularly want to be quoted on the statistics, but look at the work of Shell in Nigeria and how few people it employs there from the UK in that entire company, and how it has developed skills in the country. This must not just be a debate where we attack the multinational companies, a great many of which act morally and properly and contribute greatly to the future of a country. Yet I completely recognise, as do this Government, that tax justice is an important issue.

A number of noble Lords raised the IDC report, which was extremely measured and well thought-out. The right reverend Prelate asked about country-by-country transparency and the Global Forum on Transparency and Exchange is one of the vehicles that can be used for that. The improved exchange of tax information across countries would obviously help and will be key to the co-operation required in tackling this substantial issue, which quite rightly takes favour with noble Lords. I shall pick up on a number of his points later. However, on the subject of a Treasury Minister meeting with Members of your Lordships’ House, I am not a Treasury Minister myself so I am delighted to volunteer a Treasury Minister to do that immediately, and I think that it should happen many more times than once. The right reverend Prelate’s final point about global civil society gathering together information is key. It is about corporate citizenship. I am delighted to hear the church speak in that area.

As has already been referenced, my noble friend Lord Brooke of Sutton Mandeville said in two minutes what most of us would take two hours to say. He asked what support DfID has given. DfID has given £20 million a year to support tax regimes throughout the world. The total is about £100 million over a five-year period. For example, it is £11 million in Sierra Leone, £8 million in Tanzania and £8 million in Rwanda. In Rwanda, because of that intervention tax take has gone up by six times, which is a significant issue. Some £21 million has gone into Afghanistan. In 2004 the tax take there was 4% and now it has gone up to 11%. It is working, it is direct action. The report by the IDC said that DfID does not have the capability within its department

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to understand the tax issues that are going on—many of us do not have the capability for understanding them—but with the support of the Revenue DfID has acknowledged that and is building up its capacity.

The noble Lord, Lord Browne of Ladyton, talks about the G8 and the leadership through that, and he talks about a champion. I think that there is no greater champion than our own Prime Minister, who is championing this cause and profiling it highly, and has made it a major point as the G8 chair. I am grateful that he mentioned the Bribery Act. It is one of the great selling tools for British businesses in the work that I do abroad as the Prime Minister’s trade envoy. British companies are transparent and have to be by law. This is admired by countries across the world as they seek to become transparent. In January I will go to Libya, where transparency is the main focus of everything that they do now. With that law we have shown great international leadership. I give credit to the previous Governments, which I do quite often, for bringing in that law. It has been a bedrock for the way forward for British companies.

The noble Lord, Lord Shipley, knows as much as anyone about this. He was at Procter & Gamble and part of an international business. The right reverend Prelate the Bishop of Hereford echoes many of the words that are spoken by his right reverend colleague. I am delighted to see that they are in unison in showing this moral leadership.

The noble Lord, Lord Haskel, identifies a number of points. He was educated not at Eton but at a northern fee-paying school, Sedbergh, which I thought gave a decent education. Certainly my school did. I was at Shrewsbury. Like most of the country, we did not go to Eton but we could add up. A lot of my schoolmates and no doubt his went into the big four companies. In the days when we were growing up, they were where the money was to be made if you became an accountant. It is important that accountants act within the law, and I am sure that the big four do. There are penalties if they do not. They provide an incredibly important global service and are in an unrivalled position to have a perspective on that and advise government.

I am grateful to the noble Lord, Lord McKenzie of Luton, for his anecdotal comments about Vietnam. These points bring everything into focus and to hear them at first hand is always interesting. What a great pleasure it is to sit opposite the noble Baroness, Lady Royall. Along with the couple of points that she made, we all look with interest to the anti-corruption review that her party is carrying out. I shall make a small political point, as she did, which is that a lot of this stuff went on under the previous Government and that, “We’re all in this together”—this is a nice opportunity to say that. Indeed, this debate shows that. It is a massive global issue.

From the UK’s point of view, we have a lot of things in place. We have the disclosure of tax avoidance

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schemes and the anti-abuse rules, in relation to which Mr Aaronson QC has come up with a lot of advice. We have taken a very proactive stance against Switzerland, and not before time, as many would say. We announced in the Autumn Statement that we are going very hard for British citizens who have deliberately avoided paying tax in this country. Indeed, our country is leading the way on how the tax take should be made. It is through leadership that Britain has always been so strong. From the global point of view, we announced on 4 November that we are going to co-operate with the Germans, the French and all other G20 members. We are contributing financially to support this global endeavour. The controlled foreign companies reform prevents companies unreasonably moving into lower tax regimes, which should help in this country. As I said earlier, we have the global forum on transparency and exchange of information for tax purposes, and we are very much part of the G8 financial action task force. As chair of that, we will be showing significant leadership.

I want to go back to the fundamental point that the Government are showing leadership. I congratulate my right honourable friends the Prime Minister and the Chancellor for taking up this issue. I am sure we would all do it. This is not a political point because everyone is behind this issue, and I thank noble Lords for their kind remarks about what we are doing. The Government are showing leadership, as they must, but I do not believe it is for the Government to talk about morals. It is for the church and Christian bodies to talk about morals, and I am therefore delighted that this debate was initiated by the bastion of moral guidance in my religion. I congratulate the right reverend Prelate on taking such a lead on this issue and on an excellent and purposeful debate.

Police (Complaints and Conduct) Bill

Committee (and remaining stages)

7.42 pm

The Parliamentary Under-Secretary of State, Home Office (Lord Taylor of Holbeach): My Lords, I thank all those who have been engaged in putting this Bill on the fast track through your Lordships’ House and another place. It is not easy to get legislation organised in such a way. I pay tribute to those involved, and I am sure I do so on behalf of the noble Baroness, Lady Smith, and other noble Lords.

Committee negatived. Standing Order 46 having been dispensed with, the Bill was read a third time and passed.

Financial Services Bill

Returned from the Commons

The Bill was returned from the Commons with the Lords amendments agreed to.

House adjourned at 7.43 pm.