House of Commons Hansard Debates text for Monday 6 Mar 2000 Orders of the Day [6 Mar 2000]

Regulation of Investigatory Powers Bill [6 Mar 2000] http://www.publications.parliament.uk/pa/cm199900/cmhansrd/cm000306/debtext/00306-06.htm#00306-06_head1

6 Mar 2000 : Column 767

Orders of the Day - Regulation of Investigatory Powers Bill

[Relevant documents: The Fourteenth Report of the Trade and Industry Committee, Session 1998-99 on the draft Electronic Communications Bill, HC 862, insofar as it relates to Part III of that draft Bill, and the Government's response to that part of the Report, contained in HC 199, of Session 1999-2000.]

Order for Second Reading read. 3.35 pm

The Secretary of State for the Home Department (Mr. Jack Straw): I beg to move, That the Bill be now read a Second time. This is an important Bill, and represents a significant step forward for the protection of human rights in this country. Human rights considerations have dominated its drafting. None of the law enforcement activities specified in the Bill is new. What is new is that, for the first time, the use of these techniques will be properly regulated by law and externally supervised. That will serve to ensure that law enforcement and other operations are consistent with the duties imposed on public authorities by the European convention on human rights and by the Human Rights Act 1998. The Bill is one of a series of measures aimed at securing a better balance between law enforcement and individual rights as set out in the convention. Over the years, these measures have included the Police and Criminal Evidence Act 1984, the Security Service Act 1989, the Intelligence Services Act 1994, the Criminal Procedure and Investigations Act 1996, and the Police Act 1997. In conjunction with existing legislation, the Bill will consolidate the law on the use of investigatory powers. But there is one difference. Much of that previous legislation has been undertaken in response to rulings by the European Court of Human Rights. In one respect--and one only--the Bill follows that trend: that is in respect of the decision of the ECHR in the case of Halford, with which the Bill seeks to deal. The rest of the Bill reflects a change in the United Kingdom's stance on human rights. We have sought in the Bill to put right our existing regime in advance, without the need for individuals to resort to the courts, and then for Parliament to correct matters retrospectively. We are trying actively to ensure that our system protects individuals' convention rights, while recognising how vital such investigatory powers are to the protection of society as a whole. Striking the right balance in this area is an important responsibility of Government, and of the Home Office in particular. Throughout, this Bill reflects what I believe ought to be the correct balance, and we look forward to it being the subject of detailed scrutiny in Committee and during this debate.

Mr. Ian Bruce (South Dorset): This is an important Bill, but does the right hon. Gentleman know that its scope is so wide that, when the hon. Member for Brent, East (Mr. Livingstone) is thrown out of the Labour party, it will be an offence, punishable by two years' imprisonment, for him to read a message on his pager that was not intended for him?

Mr. Straw: I appreciate the hon. Gentleman's desire to jump on the Livingstone bandwagon, but I am not sure whether Conservative central office takes the same view. I do not begin to understand the gravamen of his question.

6 Mar 2000 : Column 768

The Bill addresses the regulation of six investigatory powers, and it is narrow in scope and subject matter. Those powers are the interception of communications; the acquisition of communications data; intrusive surveillance; directed surveillance; the use of covert human intelligence sources; and demands for decryption. They are all powerful weapons in the armoury of law enforcement agencies. In 1998, 52 per cent. of all heroin seizures resulted directly from intelligence gained from interception. Throughout 1998, the total street value of drugs seized in that way was in excess of £185 million. That amounts to more than 10 per cent. of the estimated total spend on drugs in the UK each year. More details are included in the regulatory impact assessment that I have published alongside the Bill. Drug trafficking is just one example. Some of the powers underpin vital national security operations. They are also key to tackling the serious and organised criminals involved in money laundering, human trafficking, paedophilia, tobacco smuggling and other serious offences. Precisely because those powers are so vital, they have the capacity to represent a potential threat to individual privacy, so we must ensure that regulation is tight. The regime set out in the Bill will ensure that the regulation is compatible with the terms of the convention. Each of the six powers addressed in the Bill will set out, or will provide for subordinate legislation to set out, who--which agency--can use each technique described; for what purpose; who must authorise the use of each technique; what use can be made of certain of the material acquired; who will oversee proper use of each technique; and to which body aggrieved individuals may complain. Law enforcement and other public authorities will benefit from clear guidance on the precise circumstances in which they can use particular techniques. Members of the public will benefit, because the circumstances in which the powers can be used will be clear to them. They will have access to an identifiable tribunal if they believe that the powers have been abused, and they will have the reassurance that the commissioners will publish their reports to the Prime Minister on the use of the powers every year.

Mr. A. J. Beith (Berwick-upon-Tweed): Why should the House be content to allow a statutory instrument to prescribe which additional bodies should be given powers under clause 6 to intercept communications? Which body not specified in the Bill does the Home Secretary think might have such a power--the Child Support Agency, perhaps, or the Government Whips Office? The possibility of adding bodies is considerable; surely such powers should be granted in primary legislation.

Mr. Straw: Whichever body has power to seek an intercept warrant, the process for authorising the warrant will remain the same. The warrant must be authorised personally under the hand of the Secretary of State, who, in the case of domestic warrants, is almost always the Home Secretary. I did not properly understand this before I had my present job, but the process is also subject to extensive judicial scrutiny--albeit retrospectively, as I think the right hon. Gentleman has cause to know--by the interception commissioner, who, rightly, is very thorough in monitoring the issue of warrants and checking that they have been lawfully authorised, in terms of process but, above all, in terms of use of the powers.

6 Mar 2000 : Column 769

I understand the right hon. Gentleman's point, which can be discussed in more detail in Committee, but the addition of bodies would be small, and would apply only to bodies with a law enforcement function. Chapter I of part I deals with the interception of communications. We start from the regime established by the Interception of Communications Act 1985, and we have been faithful to many of its key tenets. Authorisation is to be at the same levels as now--in other words, by warrant of the Secretary of State. The purposes for which interception can be used will be tightly constrained, as they are now, and the safeguards relating to use of intercept material will be, if anything, even more tightly regulated and constrained than they are now. There are, however, some significant changes. The criminal offence of unlawful interception is extended to private telephone and telecommunications networks. I hope that all hon. Members welcome that, because it is intended to take account of the judgment in United Kingdom v. Halford, in which the European Court of Human Rights found the existing regime in this country--where interception of private networks is not regulated at all--to be deficient. We have established a criminal offence, and have also created a civil liability in respect of interception by a network controller. I fully accept that there may be legitimate reasons for someone controlling a network to engage in which effectively amounts to interception, but the Bill will create a civil liability in respect of employers and others who overstep the mark. As for the warrants themselves, we have had to make some changes to reflect the diverse nature of modern communications networks; but warrants will still specify the communications to be intercepted and the target, and will continue to be personally authorised by the Secretary of State.

Mr. Simon Hughes (Southwark, North and Bermondsey): Can the Secretary of State explain two matters relating to the central proposition in the Bill? First, why was the opportunity not taken to bring all the different authorities to intercept under a common procedure, so that, instead of having nine different sets of powers and sets of authorities, we could have just one? Secondly, why was the opportunity not taken to do what many democratic countries have done, and transfer the authority power from politicians or officials to a judicial authority in the first instance?

Mr. Straw: Let me say in answer to the first question that we are not dealing with matters that are exactly similar. There is a world of difference between the interception of someone's telephone or telecommunications system and, for example, the planting of a covert microphone, and the use of directed surveillance, which currently takes place all the time in an unregulated way. We need a regime or set of regimes for regulation that are appropriate to the sort of investigatory powers that are used. It would be absurd and impractical if, every time the police wished to use directed surveillance, they had to approach the Secretary of State or a judge for a warrant. Equally, it would be inappropriate--I do not think that it is the subject of any argument in the House--if warrants for telephone interceptions were

6 Mar 2000 : Column 770

authorised at a lower level than they are now. Therefore, we have produced bespoke authorisation procedures that are fitted to the particular powers in the Bill.

Mr. John Bercow (Buckingham): Will the Secretary of State give way?

Mr. Straw: May I first answer the other point that was raised by the hon. Member for Southwark, North and Bermondsey (Mr. Hughes)? That was whether we should have taken the opportunity to remove from the Secretary of State the power to grant intercept warrants from all law-enforcement agencies. I assume that he is talking also about the powers to grant intrusive surveillance warrants in respect of the intelligence agencies. That has been a long-running debate. The powers that are exercised by the Secretary of State--certainly by me and, I believe, by every one of my predecessors--have been exercised very carefully.

Mr. Simon Hughes: Of course.

Mr. Straw: The hon. Gentleman says "Of course" but it is an important point to get on the record. There may not be an "of course" about it, but it happens to be the case. In addition--I greatly welcome it--the interception commissioner is someone of high judicial standing. Currently, the position is held by Lord Nolan. As I and my colleagues have witnessed, he properly scrutinises the warrants and is available for advice where there is an issue about whether an intercept application does, or does not, come within the Interception of Communications Act. I devote much time to checking applications and warrants before I sign them, and asking questions if I am not satisfied with the applications, so the system is judicially supervised. The initial decision is made by a Secretary of State. It is a matter of practice and convenience, but not in any sense a diminution of people's human rights, that this country has that system. It works. There has been no overwhelming argument, or no substantial argument to change it. If one looks at the practice in other countries, it does not necessarily follow that, just because a judicial warrant is required, there is a greater safeguard for the individual. Indeed, I suggest that, in quite a number of other countries, the fact that a judicial warrant is required lessens the protection that is offered to people because the judicial warrant acts as a fig leaf for people's human rights, and not as a serious safeguard.

Mrs. Gwyneth Dunwoody (Crewe and Nantwich): Will my right hon. Friend give way?

Mr. Straw: As my hon. Friend knows from previous experience, I defer to her always and the hon. Member for Buckingham (Mr. Bercow) has deferred to her, too, indicating that she should intervene first.

Mrs. Dunwoody: An unlikely story, but, as always, I am humbly aware of the kindness of my right hon. Friend in giving way. May I ask him about a point that concerns me? With the increasing use of computers as a means of alternative communications, is he certain not only that the present system will be extended in a way

6 Mar 2000 : Column 771

that will maintain the proper procedures, but, equally, that the development of new electronic communications and their use in so many instances will be covered--or will surveillance increasingly be done using completely different methods and so be very difficult to check?

Mr. Straw: When it comes to humility, I always defer to my hon. Friend, as she knows only too well from the time we had almost adjoining rooms in Norman Shaw North. [Interruption.] Nothing happened apart from the fact that I used occasionally to clean her shoes. I reassure her that the Bill is partly designed to take account of the significant changes in technology in the 15 years since the 1985 Act was put on to the statute book. It is also designed to ensure that not only telephone calls, but--subject to proper procedures, when appropriate--data streams can be intercepted. The fact is that--I shall deal with this in more detail when we discuss encryption--given the current vast scale of data traffic, which was unimagined even 15 years ago, the possibilities for law enforcement agencies to keep track of that traffic, except for very specific and targeted purposes, is very limited.

Mr. Bercow: I am grateful to the Home Secretary for giving way. I am certainly not expecting him to clean my shoes, but I would appreciate an answer. How and when will the Home Secretary address the specific concerns about regulatory costs that have been expressed by the Alliance for Electronic Business? Given the fact, which he will not dispute, that the average British small business, employing fewer than 100 people, now faces an additional annual cost of £5,000 directly as a result of the Government's regulatory policies, to what figure will that increase rise as a result of the Bill?

Mr. Straw: I shall deal later in my speech with the burden. If the hon. Gentleman is not satisfied with the answer that I give, I shall be delighted to give way to him again.

Mr. Dale Campbell-Savours (Workington): May I perhaps rewind the tape, and deal with my right hon. Friend's earlier comment on the diligence and time that he himself personally devotes to checking to ensure that the warranting system works? I believe that that comment should be an assurance to many members of the public who write to Members of Parliament on the subject, but do not understand how my he goes about his functions in that sphere.

Mr. Straw: I am extremely grateful to my hon. Friend. As a member of the Intelligence and Security Committee, he has reason to know more about the subject than most right. hon. and hon. Members possibly could. I think that all Secretaries of State have taken the responsibility very seriously indeed--and so they should, as should I. Interception is a patent invasion of individuals' privacy, and it should occur only when it is properly justified within the law and in all the circumstances.

Dr. Julian Lewis (New Forest, East): Will the right hon. Gentleman give way?

Mr. Straw: If the hon. Gentleman will excuse me, I have to make some progress. If I have some time, I shall give way.

6 Mar 2000 : Column 772

As I said to my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody), part of the Bill is designed to ensure that the intercept regime takes proper account of technological developments. One of those developments is that people change their telephones with a frequency that is sometimes astonishing, whereas, 15 years ago, it was a simple matter of one person, one line. We have sought to take account of that fact in the Bill. The target of an intercept warrant will still have to be authorised by the Secretary of State. Some changes in telephone numbers--which, as I know to my cost, can happen at any time of the day or night--will be open to be authorised by senior officials at the relevant Departments. We are taking the opportunity to rationalise the time scales for renewal of warrants. On the issue of burdens on industry, currently, public telecommunications operators are required to ensure that their network contains a basic intercept capability. The requirement is similar to that which applies in other countries. However, the requirement does not extend to other providers of publicly available communications services, such as internet service providers or international simple resale operators. The Bill proposes that a level playing field should apply across all types of industry, and it enshrines in statute the existing principle that service providers should maintain a reasonable intercept facility. We are--to answer the question of the hon. Member for Buckingham--keen to minimise any additional burden on United Kingdom industry and to avoid damaging its international competitiveness. The Home Office is already engaged in detailed discussions with industry about what might constitute a reasonable interception capability for them. Cost apportionment between Government and industry will be addressed during detailed consultations. The starting point is the existing framework, in which responsibility for meeting the costs of reasonable intercept capability lies with the public telecommunications operators. However, the Bill recognises--there is such provision in the Bill--that it would be appropriate for the Government to make a contribution to costs that would otherwise be unreasonable for communications service providers to bear.

Mr. Oliver Heald (North-East Hertfordshire): The Federation of the Electronics Industry tells me that, at the moment, no one knows how to provide a reasonable intercept capability for the internet, and that it could be incredibly expensive. Has the Home Office found a way of permitting that to happen technically?

Mr. Straw: I accept that there are complications in the techniques, but it is not impossible and a great deal of work is going on. Some parts of internet communications can be intercepted at the moment. The problem is that, under existing legislation, responsibilities apply only to public telecommunications operators. We are trying to relieve the burden which has fallen, by chance, on the large public telecommunications operators and ensure that it is properly spread.

Mr. Bercow: Some of what the Home Secretary has said has been reassuring, but is he aware that businesses have complained frequently over the past three years that there is too little consultation and, too frequently, too little

6 Mar 2000 : Column 773

notice of their requirement to implement new regulations? If the Home Secretary is serious about reassuring business, as I hope he is, will he guarantee that businesses will be consulted for at least three months on any proposed new regulations, and that they will be granted at least three months' notice of any legal requirement to implement new regulations?

Mr. Straw: The concerns of business about the burden of Government regulation go back beyond May 1997--they are timeless. I happen to believe that it is almost certain that a similar regime to that proposed by the Bill would have been put in place had the Conservative party been in power now. We have consulted widely on this Bill, and I published a consultation document last year. Discussions are continuing. I will not be pinned down to a specific time frame but, so far as possible, we want to reach a consensus--it is in our interest to do so. What we have achieved until now in terms of making this country a safer one has been achieved significantly through the voluntary co-operation of the public telecommunications operators. We cannot sing about this too often--for obvious reasons--but the operators have performed a significant public service. On communications data--to which I shall refer in a moment--what we are doing will relieve a burden on telecommunications operators, and not increase it. Clauses 16 and 17 replace section 9 of the 1985 Act. The provision rules out from legal proceedings the use of intercept material. The consultation exercise last summer asked for responses on this point, and more individual comments were received about it than any other. Of those who responded--this is never conclusive, but I give the information to the House--two thirds were in favour of retaining the provision. I have considered the matter long and hard, and our provision is unusual internationally. However, I believe that we should follow the balance of opinion. It is significant that section 9--which will become clauses 16 and 17--was recently approved by the European Court of Human Rights in the case of UK v. Jasper. Chapter II of part I deals with the acquisition of communications data, which are normally provided to investigating bodies under a voluntary regime set up by the Telecommunications Act 1984 and the Data Protection Act 1998. This existing and loosely regulated regime is unacceptable in terms of human rights and because, in certain cases, it has led to unacceptably high demands on the public telecommunications operators. The Bill sets out in statute precisely what hurdles law enforcement and other agencies must overcome before they can require the data from service providers. The Bill then puts an onus on service providers to provide the information, and allows for them to be compensated--a proper statutory regime which is much to their benefit. The House will recall that, in opposition, I undertook to make this change in a response to my hon. Friend the Member for Cynon Valley (Ann Clwyd) during proceedings on the Police Act 1997. Part II of the Bill covers the use of intrusive surveillance, directed surveillance and covert human intelligence sources. Those are not new powers, but the provisions in this part of the Bill will put their use on a statutory basis. Part II does not create any illegality in the use of part II techniques, but it will ensure that the use of

6 Mar 2000 : Column 774

the powers is properly regulated. Where such actions are authorised properly under the provisions of the Bill, that will be an answer to any subsequent assertion based on article 8 of the European convention that a person's privacy has been invaded without justification.

Mr. Graham Brady (Altrincham and Sale, West): I thank the Home Secretary for giving way on that point, because a constituent has raised it with me. Will there be any way after an interception, however long ago it was, for the person whose communication was intercepted to be informed of that fact, so that they could raise the issue and make a complaint if appropriate?

Mr. Straw: The short answer is no. I am sorry to disappoint the hon. Gentleman's constituent, but I regularly have to write to individuals who face no prospect whatever of being the subject of interception laboriously to explain that fact. I also explain to constituents at my surgeries that, given the weight of the threat from international crime and terrorism, the prospect is remote that we would devote resources to intercepting their telephone calls. However, I then provide no reassurance when I say that I cannot tell them whether their telephone is the subject of intercept because otherwise others who might be the subject of intercept could come along on fishing expeditions. It is logically a difficult position to explain to individuals, and it is difficult for people to understand that they may make a complaint to the tribunal--I shall come on to the changes we shall make in respect of the tribunal--that they may be being intercepted even though it is not possible to tell them whether they are being intercepted. Because it is secret, people are bound to be suspicious, but--to repeat the point made by my hon. Friend the Member for Workington (Mr. Campbell-Savours) and as I believed before I became Home Secretary, and have fully understood since--the powers are operated in a strong ethical and legal framework. That is as it should be.

Dr. Julian Lewis: Will the Home Secretary clear up the concerns of serious investigative journalists and researchers that some of those regulations might hamper their ability to cover themselves when they are talking on the telephone with people whom they are investigating and wish to keep a record of the conversation? I do not mean the interception by a third party of conversations between two other parties, but the ability of researchers to cover their backs in the course of investigations.

Mr. Straw: I am not entirely clear what the hon. Gentleman is asking. If he is asking whether journalists are routinely the subject of intercept, the answer is no. The only people subject to intercept are those who come within the terms of the Interception of Communications Act or the Bill. If he is talking about a journalist routinely recording his own telephone conversations, that is not remotely covered by the Bill, although it is a courtesy--to say the least--that if a journalist, or anybody else, is recording a telephone conversation, they should tell the person at the other end.

Mr. Michael Fabricant (Lichfield): They are obliged to tell.

Mr. Straw: I believe that that is the case.

6 Mar 2000 : Column 775

Decryption has aroused much interest. Part III of the Bill deals with demands to decrypt data. We consulted on similar provisions published as part of the draft Electronic Communications Bill last July. Encryption itself is vital to the success of the e-commerce revolution, and helps to prevent certain types of crime, such as fraud on the internet. However, encryption can also be used by criminals to frustrate law enforcement. That is happening already, and the problems will increase as the technology becomes more available. The new decryption power is needed to maintain the effectiveness of existing statutory powers. The limit of what we propose is assisting law enforcement agencies in reading the contents of material they have already lawfully obtained. Where an investigating agency has reasonable grounds for believing that a key exists to decrypt lawfully acquired data, the Bill will introduce a power, with proper authorisation procedures and stringent safeguards, to allow them to require the decryption of that data. The introduction of a new power was specifically recommended in last year's report on encryption and law enforcement by the performance and innovation unit of the Cabinet Office. The Select Committee on Trade and Industry report concluded that the power would be a useful addition to the law enforcement armoury.

Mr. Brian White (Milton Keynes, North-East): My right hon. Friend will know that several businesses expressed unease when the Electronic Communications Bill was published that the measure would deter inward investment and e-commerce in this country. How has he tackled that problem?

Mr. Straw: My hon. Friend will know that before the Bill was published, there was a suggestion, in this and other Governments, that the measure should make provision for key escrow, so that keys could be vested with safe third parties and could therefore be available.

Miss Ann Widdecombe (Maidstone and The Weald): Then the idea was dropped.

Mr. Straw: As the right hon. Member for Maidstone and The Weald (Miss Widdecombe) says, from a sedentary position, the idea was dropped. There is no harm in discussing an issue and then taking a different view, according to the balance of the argument. We were persuaded that key escrow could have disrupted e-commerce in this country, especially if other countries did not adopt the arrangement. We were proposing a quasi-voluntary regime, whereas France--as one might expect--was proposing a wholly dirigiste regime that would have made it compulsory in all circumstances to vest keys with a safe third party. However, even France went off the boil with regard to that proposal, and the French Government are reconsidering the matter. Secondly, the Government took account of almost everything that the Select Committee said, and we have strengthened the safeguards in the offences relating to a failure to comply with the notice for key disclosure under clause 48. Those measures are set out in clauses 49 and 50.

Mr. Fabricant: I fully support the concept that, where they exist, keys should be capable of access, for instance

6 Mar 2000 : Column 776

in relation to the transfer of funds using credit cards. However, what about when a key is not in the public domain, so to speak? The Home Secretary will know that drug dealers use their own encryption tools when they communicate with each other. What does he have to say about e-mails that are encrypted and decrypted by drug dealers? The internet service providers will not be aware of what is happening, as the messages will be only a data stream to them.

Mr. Straw: A person who does not have possession of the key cannot be guilty of the offence. By definition, the keys are a secret confined to the people who have control of them. One half of the key--the part used by the person communicating data to a recipient--is public; by definition, the other half is private, and that is the part that interests law enforcement agencies.

Mr. Simon Hughes: Is not the remaining significant complaint about the proposals that they could penalise people who lose their encryption keys? The Bill places on such people the burden of proving either that they never had such a key in the first place, or that they are innocent. However, it offers a relatively light penalty for people who intentionally claim that they cannot find their method of decryption. Clearly, major criminals would rather accept a six-month punishment than a much more severe penalty. Would not that seem to them to be a price worth paying?

Mr. Straw: It is worth bearing in mind that the product of interception resulting from the use of such keys cannot be adduced in evidence. People will not be able to deny material of evidential value in court, as the Bill--like the Interception of Communications Act--is based on the premise that neither prosecution nor defence can adduce the product of intercept as evidence in court. If there is concern in the House about the balance of the penalties, which can be discussed in detail in Committee, I am happy to take representations about it. As I have said before, I have never put a Bill before the House that has not been improved as a result of the parliamentary process, and I hope that I never will, because that is the essence of what Parliament is here for. We have had discussions about people who have lost their key. I find it slightly eccentric, although it is not impossible, that someone can lose a key that he needs to access a large amount of data. Such things happen, of course, and the person has a perfect defence if he has lost it and then forgotten it. I do not believe that a court would convict people in those circumstances if it believed them. If it did not, however, that would be a different matter. Whether the case went before a magistrates court or a Crown court, we have very high standards of justice in this country. I should like to deal briefly with international comparisons and the role of the commissioners and the tribunal. Law enforcement worldwide is worried about the criminal use of encryption. I have discussed this on a number of occasions with colleague Ministers of Justice and the Interior, including the United States Attorney- General, Janet Reno. The United Kingdom and the United States are both putting in place a package of measures to tackle the problem.

6 Mar 2000 : Column 777

In European terms, we are ahead of the game in e-commerce and law enforcement legislation. Our goal is to make the United Kingdom the best and safest place in the world to do e-commerce. The industry, too, wants a secure environment in which to conduct business. The scheme of the Bill is aimed at trying to keep up with the advance of technology as best we can. The gloomy prognosis, though, is that whatever is done, law enforcement will take a hit over encryption. That is partly my answer to my hon. Friend the Member for Crewe and Nantwich. Introducing the measures in part III is the least that we can do to minimise the effect of that hit. They form an important part of the package of measures that we are putting in place if we are to have any hope of dealing successfully with the threat from the criminal use of encryption. Part IV is in many ways the most important part of the Bill. It sets out who is to scrutinise the use of the six powers and it establishes a tribunal, which will be accessible to all. The existing commissioners for interception, the security service, intelligence services and surveillance will continue with their present roles and will add to some of them the powers in the Bill. One role of the commissioners will be to reassure Parliament and the public that the powers are being used properly. In addition, a new tribunal is established to consider complaints. The hon. Member for Southwark, North and Bermondsey asked whether we could bring together all the separate regulation regimes. I did not think that that was appropriate, but I accept the argument that we should amalgamate the current plethora of tribunals and different avenues available for complaints. That is what we are doing in the Bill. We are abolishing the specific tribunals and establishing one all-embracing tribunal to replace those functions and any others that are relevant under the Bill. It will be a serious and powerful tribunal, and will be available as redress in respect of the use of a wide number of techniques by the investigating agencies. The Bill sets out six conditions for the use of six law enforcement powers, used daily in the front line against some of the most serious threats to our society. We have previously regulated these powers on a piecemeal basis in response to judgments of the European Court of Human Rights. In this Bill, we are anticipating, on a comprehensive basis, the requirements of human rights legislation. These are the principles. No doubt some of the more detailed provisions will lead to discussion here and in Committee. Meanwhile, I commend the Bill to the House.

4.14 pm

Miss Ann Widdecombe (Maidstone and The Weald): This is an important Bill, dealing with very complex matters. Given the enormous advances in technology and the possibility of its lawful and unlawful use, we fully acknowledge that the time has come to look again at updating the Interception of Communications Act 1985. We are therefore broadly supportive of the principles behind the Bill. We will not be opposing Second Reading, but that does not mean that there are not areas of fairly serious concern that we will wish to examine in considerable detail during the Bill's passage. The last time I told the Home Secretary that I did not oppose a Bill's Second Reading he evinced some displeasure when I chose to oppose it at further stages of

6 Mar 2000 : Column 778

its proceedings. The fact that we support Second Reading--or that, at any rate, we do not oppose it--should not be taken as indicative that, if our concerns are not met, we shall continue to support the Bill throughout its future stages. Perhaps, as I have put that on the record, the right hon. Gentleman will not be greatly disappointed later. However, I hope that it will not be necessary to oppose the Bill; I hope that he will allow us to improve it so as to meet our concerns. We accept that the explosion in methods of communication has given rise to a similar explosion in new methods of committing crime. If we failed to update the legislation that we introduced in 1985, we should damage the capability of this country's law enforcement, security and intelligence services to do their job. However, the Bill is like the curate's egg--it is good in parts. We accept the need both to widen the power of interception to cover modern communications methods and to regulate surveillance and covert human intelligence. However, it is important that the Bill should be effective and still strike a proper balance between the needs of the crime fighter, the legitimate concern of business to avoid overweening regulation and the interest of the citizen in respecting fundamental human rights. In some ways, the Bill does not provide crime fighters with all that they need. For example, clause 6 deals with those persons who may apply for interception warrants. It lists the head of every major security service and provides for the Secretary of State to designate "any . . . other person", but one notable omission is any provision for a senior official responsible for the detection of serious benefit fraud to apply for an interception warrant. Given that such fraud is by far the most substantial crime by value committed in the United Kingdom, it seems a bit odd that no senior official at the Department of Social Security can apply for a warrant--even in the most serious cases of benefit fraud; for example, those involving international gangs. The powers in the Bill need strengthening to ensure that law enforcement agencies are able to obtain the evidence they need when dealing with serious sex offenders, drug traffickers and those involved in organised and terrorist offences by intercepting their communications and being able to break the codes that are used. I shall deal with that matter more fully when I come to the use of encrypted communications. One of the great successes of the past few years has been the UK's growing information technology industry. The industry realises that it is important that law enforcement agencies should be able to carry out their work and that there should be provision to allow the interception of communications.

Mr. Straw rose-- Miss Widdecombe: The right hon. Gentleman now has the answer to my point about social security.

Mr. Straw: I was checking whether my recollection of the matter was correct. Recently, there was a large case in Lancashire. In most cases of serious social security fraud, the police are involved. There is no problem in the police making an application through the National

6 Mar 2000 : Column 779

Criminal Intelligence Service--they do that through an intermediary. There would be no impediment to that system for applications in cases of serious benefit fraud.

Miss Widdecombe: I am grateful to the right hon. Gentleman for that attempt at elucidation, but the situation remains exactly as I described it. The head of social security is not able to apply for an interception warrant. I invite the right hon. Gentleman to consider whether there are cases that might not necessarily be dealt with at one remove through the police and whether there might thus be some circumstances in which that individual should be able to apply for an interception warrant. The Internet Services Providers Association believes that

in order to allow enforcement agencies to carry out their work, there should be provision to allow interception of communications. The association is not against the Bill in principle.

The Federation of the Electronics Industry has said: FEI does not question the objectives or underlying reasons for the proposed legislative reforms. The Alliance for Electronic Business has said that the Alliance strongly supports the Government's objective in regulating the interception and monitoring of electronic communications.

Therefore, there appears to be general support for the principles, but that puts upon us an even greater responsibility to listen to what those bodies say about the improvements that are needed to the Bill. Too many times during the Bill's consultation process, the views of industry have been overlooked. A balance has to be struck between allowing law enforcement to operate--as it must and the House would expect it to--allowing industry to deliver what the Bill asks of it and avoiding over-regulation. Clause 12 will enable the Home Secretary to require communication services providers to have an interception capability and, by notice, to require certain technical steps to be taken to achieve that. The industry is concerned that the steps proposed by the Home Secretary may be either technically flawed or disproportionate. The technical difficulties involved should not be ignored.

Mr. Fabricant: My right hon. Friend is absolutely right to point out the practical difficulties of interception. Is she aware that up to 100 million e-mails are sent every day and that the routes that they take are quite extraordinary? If I were to e-mail her, it is quite probable that the message would go via California or Australia. What are the practical difficulties in intercepting such communications?

Miss Widdecombe: It is precisely for that sort of highly complex operation that we need to examine carefully the provisions in the Bill.

Mr. Fabricant: And there is the cost.

Miss Widdecombe: My hon. Friend also refers to the cost and he is right to do so. Cost is a significant consideration and I shall come to it shortly.

6 Mar 2000 : Column 780

It will not be good enough simply to have the ability to intercept data. We must have the technical capability to read it and, as the Home Secretary has acknowledged, that is something completely different. Messages on the internet are split and sent by different routes, as my hon. Friend the Member for Lichfield (Mr. Fabricant) has just pointed out. It is also possible to hide messages in other signals. That raises technical issues about the nature and proportionality of what the Home Secretary is able to propose. There is a balance to be struck, therefore, between the possibility of substantial over-regulationand the practicalities of law enforcement. Through amendments that we shall table in Committee, we shall seek to try to redress that balance where we think that it has gone awry. Clause 13 enables the Home Secretary to contribute to the cost of providing an interception capability, but it does not give us any clue as to what the Government's approach will be. It is important that the information technology industry has proportionate technical steps to take and that the costs are not so burdensome that they kill fledgling businesses at the cutting edge of technology. The Internet Services Providers Association has said:

if ISPs in the UK are made to carry the burden of the costs of interception, at best they will be at a disadvantage compared to their European and international competitors and at worst will be unable to operate. It does not seem that this position would help make the UK "the best place in the world for e-commerce".

I therefore want to ask the Government three questions. Are they committed to making payments to providers so as to obtain an interception capability? If so, on what basis will payments be made? Will they at least pledge that no communications services provider will be faced with such costs that it will simply be unable to continue? There is also concern about over-regulation of communications data--for example, billing logs and other logs of communications traffic. Clause 21 will enable designated persons from security services, Customs and Excise and any other authority specified by the Home Secretary to obtain "communications data". Concern has been expressed by operators about the wide range of persons who will have access to that information and about the wide range of information involved. Modern software enables a very detailed pattern of a person's communications to be obtained, detailing every aspect of life if sufficient communications data are made available. That is a massive invasion of privacy. Although that power could be justified in a serious case, it should be carefully restricted, and the Opposition will want to table amendments in Committee to make sure that it will be. We do not think that the power should be available simply to any public authority. To give an obvious example, it would not be justified to extend such a power to local authorities investigating council tax arrears. There is also an important technical issue. Communications services providers could be required to build special software and hardware, and it is not at all clear what the extent or cost of that would be. Yet the penalty is a conviction for a criminal offence. The boundaries of what is proposed need to be clarified and they need to be proportionate. There is a great deal of controversy surrounding clauses 46 to 49. Clause 46 enables authorities to require a person to provide either the key necessary to decode an encrypted message or the information in the message in an

6 Mar 2000 : Column 781

intelligible form. Clause 49 creates the offence of failing to comply with such a notice. Yet the nature of the offence is such that the burden of proving an innocent explanation for failure to provide the key is laid at the door of the accused; in other words, people are presumed guilty unless they can prove that they are innocent.

Mr. Ian Bruce: Is my right hon. Friend aware that approximately half the calls to the parliamentary video and data network, which controls the computers in this place, are from people who have forgotten their password, and there is a routine to get people back into the system? Surely that is one of the practical problems associated with what the Home Secretary is trying to achieve.

Miss Widdecombe: That shows that people can forget, but I think that it is fair to imagine that where we are talking about highly complex encrypted messages, some care will have been taken to look after the key. The crucial point is that people will be presumed guilty until they can prove themselves innocent. That is questionable justice. The Home Secretary shakes his head, but British justice relies on people being presumed innocent until proved guilty. To put it in terms that he might prefer, the provision is probably in breach of the European convention on human rights. He might take that point seriously, if he will not take seriously the point about British justice. There is no defence allowed where someone might demonstrate to a court that they have shown due diligence in storing the key that is being requested via a section 46 notice. Immediately after the debate, we intend to table a new clause to replace clause 49 which would introduce such a defence. The offence, as drafted, does not meet the needs even of law enforcement because the penalty is modest: a maximum of two years' imprisonment. Once tightened up to allow the innocent to defend themselves, that could substantially rise. If it does not rise, a serious offender would be likely to refuse the key to encrypted information and hope that he could establish that he had either lost or forgotten it. If he failed to establish that, the relatively modest sentence would be more acceptable to him than the likely outcome if the evidence of serious wrongdoing were uncovered and led to prosecution for a more substantive offence. The burden of proof should be the normal one of presumed innocent until proved guilty, but the penalty should then be vastly greater, so that it does not pay to lose a key in the hope of escaping a much more serious penalty for a more serious offence. The Home Secretary has said that he cannot imagine an innocent person discarding the key, but the provisions will apply to anything that has happened in the past, and he will be aware that a common practice of encryption is frequent changing of the keys. The key being sought might therefore have been discarded. Under the guilty until proved innocent proposals, a person who had discarded a key might be at risk of an unsafe conviction.

Ian Taylor (Esher and Walton): When my right hon. Friend is carefully drafting amendments, will she consider one other point which I did not hear the Home Secretary specifically address? If the fear of penalties on businesses is such that they are concerned that they might

6 Mar 2000 : Column 782

start to lose their private key, it is likely that they will place such private keys in key escrow. If the key escrow system returns, it is possible that it will grow into one of trusted third parties and, therefore, the Home Office will be reintroducing by the back door what was abandoned in the Electronic Communications Bill. In his winding-up speech, will the Minister further assure the House that that is not the intention?

Miss Widdecombe: I am grateful to my hon. Friend, although in fairness--I do not want to do the Minister's job for him--[Interruption.] Well, I do eventually, yes; but perhaps not at this very moment. There is a distinction to be drawn between compelling a business to deposit a copy of its key, which was the original proposal, and businesses voluntarily deciding to keep copies of their key with a trusted third party. Many--certainly some--already do so for the safety of the key. Perhaps the Minister will nevertheless be able to give the assurance sought: there is no intention, either now or later, as far as he can see, of reintroducing the requirement that has been dropped. The draft offence needs to be amended and targeted specifically at known offenders with a background of previous wrongdoing. Evidence of previous wrongdoing should be admissible to prove guilty intention. If the burden of proving guilty knowledge were on the prosecution, miscarriages of justice would be unlikely, but if evidence of previous wrongdoing were admissible to prove guilty knowledge, the guilty would be less likely to go free. If the offence were amended on those lines, we could set a tougher maximum sentence, which would actively discourage criminals from refusing to co-operate. It will be along those lines that we shall be proposing amendments to improve that aspect. Our view is that tough justice is better than rough justice. [Interruption.] The Home Secretary has proposed rough justice and very light penalties. If that is how he wants to be known, that is fair enough. In many ways, the Bill is over-bureaucratic. Part IV, which deals with scrutiny, proposes that the Prime Minister should be able to appoint two new commissioners to review the performance of the Home Secretary in exercising his functions. That would involve a new interception of communications commissioner and a new covert investigations commissioner. We already have a Security Service Act commissioner, an Intelligence Services Act commissioner, a chief surveillance commissioner and ordinary surveillance commissioners. None of those appears to have an independent investigatory team available to them. It seems that the Government believe that commissioning should be a growth industry. The question arises whether any of those important positions entail any real power, particularly as they lack a team of investigators to back up their role.

Mr. Allan Rogers (Rhondda): Will the right hon. Lady refresh my memory by telling me under which Government the commissioners were established? I believe that one set was established in 1989 and the other in 1994--under a Conservative Government.

Miss Widdecombe: The point is whether we should be adding to the number, whether adding to them will make for any greater effectiveness or whether we should be finding another way of doing things.

6 Mar 2000 : Column 783

The question also arises, therefore, of whether there are simply too many commissioners. We shall investigate in Committee whether it would be better to have one unified commission with a proper staff of investigators to provide real and effective scrutiny. I am pleased to see the hon. Gentleman nodding. There we go; his conversion was very quick. It is easy to forget that the information technology industry is one of the United Kingdom's great success stories. Many of the technologies that criminals use were developed for very good reasons. The encryption and other secure communications techniques were developed not to assist criminals in hiding their activities, but to provide a secure commercial environment in which proper confidentiality could be maintained. There are the highest public policy reasons for ensuring that that technology is not compromised by the Bill. We live in a global marketplace and we should not forget that many of those working in the communications industry do not have to operate from the UK if they do not wish to do so. It is important that security services and regulators should not attempt to do more than is necessary in the interests of proper crime detection and prevention. This is the last area in which gold plating would be good idea. That brings us back to the balancing act that the Government must perform in relation to the Bill. The legislation must do what we all agree it needs to do, but it must not disadvantage the innocent or those caught in the crossfire. Increased regulation under the current Government is already a cause of concern; it would have been made far worse by the Electronic Communications Bill, but for the efforts of the Opposition. As the House knows, the proposals contained in part III of the Bill were, in a different form, included in the original draft of the Electronic Communications Bill and were dropped only after the strongest representations from Opposition Members and from the industry. At this point, I pay tribute to the work of the Foundation for Information Policy Research. It is important that the Home Office recognises the important principle of not over-regulating or providing disincentives. Many say that the Government are doomed to fail, that it will be impossible to detect the communications of serious criminals and that the innocent will be burdened with extra regulation. However, we are prepared to give the Government the benefit of the doubt: we shall try to improve the Bill in the belief that it can and will be made to work. Many involved in the communications industry have a choice of where they operate from, but it is strongly in the UK's interests that they remain here. The Government must keep that at the forefront of their mind when considering our amendments to their Bill.

4.37 pm Mr. Mike Gapes (Ilford, South): The interception of communications has come a long way since my dad left school in 1935 and started work as a messenger boy at the Post Office. I hope that I do not get him in trouble by telling the following story. One of his jobs was to collect letters and take them by bicycle to a special building, where they were opened; later, he would collect them for delivery on his round. Interception of communications requires far more sophisticated techniques these days.

6 Mar 2000 : Column 784

The Bill is necessary and overdue, but I, like hon. Members on both sides, am concerned that it may well become out of date within in very short time. That is one of the problems of the technological changes that confront us. It does not mean that we should not legislate, but we must recognise that we may have to revisit this subject in two, three, five or 10 years' time, depending on how fast and how far these matters advance. The use of interception of communications in combating drug trafficking has been mentioned, and my right hon. Friend the Home Secretary referred to heroin seizures. I wish to flag up one issue that should be taken into consideration: the way in which the criminal gangs involved in drugs smuggling are changing. A disturbing article, which appeared originally in the American magazine, Mother Jones, and was reprinted in The Editor section of The Guardian on 3 March, highlights the fact that Law enforcement officials in Europe have suspected for years that ties existed between Kosovar rebels and Balkan drug smugglers. But since Washington enthroned the Kosovo Liberation Army in that Yugoslav province, KLA-associated drug traffickers have cemented their influence and used their new status to increase heroin trafficking and forge links with nationalist rebel groups and drug cartels. According to the article, German police say that Kosovar Albanians import 80 per cent. of Europe's heroin. We must take that seriously. An organised group is bringing heroin, which originates in Afghanistan, through various conduits from Asia into Europe and spreading it around the world. The article also points out the links between that group and the Colombian drug cartels. As incidents in many countries have shown, such groups operate through sophisticated money-laundering techniques and international communications, and use the most advanced technologies. Our organised anti-criminal activities must be equally sophisticated in order to intercept their communications, find out what they are doing and stop them bringing death and destruction to so many people in this country and throughout the world.

Mr. White: Is my hon. Friend aware of the current debate in United States, where it is alleged that the CIA provided the keys and encryption to those groups and thereby prevented the Drug Enforcement Agency from taking action against them?

Mr. Gapes: I was not aware of that allegation. It is extremely serious and I hope that the relevant authorities will look into it. Another aspect of the Bill concerns effective measures to combat terrorism. Some of us in the Chamber served on the Standing Committee that recently considered the Terrorism Bill. I shall not rerun the arguments, but I notice that the hon. Member for Southwark, North and Bermondsey (Mr. Hughes) is present, and I expect that we may return to those issues. Several international terrorist organisations clearly use sophisticated methods in their operations, with accountants, lawyers, newspapers and front organisations. They operate globally. They plan their crimes in one country, finance them in another, carry them out in a third country, and the perpetrators often live or seek refuge in a fourth country. We therefore need effective international measures to combat such organisations. I hope that the Bill

6 Mar 2000 : Column 785

will go some way towards supporting the vital work already undertaken by the intelligence and security organisations, the police through Europol and other bodies. Concern has been expressed about the Bill's impact on internet service providers. I understand the concern of those in the information technology industry when they see measures that could, in a worst case scenario, lead to increased regulation or potential costs. However, it is not right that society should not take action against criminal organisations, paedophile gangs, terrorist groups and drug smugglers who are operating using that technology. We must get the balance right, but it is a counsel of despair to argue that, because the internet is global and we must be at the centre of it, we should do nothing about such abuses. Constituents of mine whose children are suffering as a result of drugs, and people who themselves or whose relatives have been maimed or killed because of terrorist action will not think kindly of legislators who fail to take action leading to effective steps against the perpetrators of those crimes.

Mr. Ian Bruce: I understand the hon. Gentleman's point. I have read the Bill carefully, and any sensible criminal can take simple measures to avoid being caught by it. Why should all the honest people have to spend literally billions of pounds--thus possibly making Britain the wrong place in which to establish businesses--simply because some criminals can use encryption?

Mr. Gapes: The hon. Gentleman is obviously an expert in criminal activity and avoiding the effects of legislation. Perhaps he will tell us how that can be done. I do not believe that it will be that easy. I suspect that people may try to avoid being caught by the measure, as they always do, because that is the nature of the criminal or terrorist mind. However, we must update our legislation. One reason for updating legislation is to avoid the current position, in which all sorts of unregulated surveillance activities take place. If we do not regulate those activities, unauthorised, unregulated surveillance will occur because people regard it as necessary, but we shall lack the appropriate regulatory mechanism to bring people to account. That would be the worst of both worlds. I want the Minister to clarify clause 6(j), which refers to a person who, for the purposes of any international mutual assistance agreement, is the competent authority of a country or territory outside the United Kingdom. I interpret that to mean that it allows our Government to give authority to someone in another Government or international organisation to undertake the interception on our behalf. However, I would be grateful for some exact clarification of that phrase and of whether it has a wider application than the interpretation that I have just given. The Bill refers to interception of non-public networks, such as office switchboards. We are considering a complicated matter. When we started work years ago, most people had one switchboard, a couple of phone lines, and no sophisticated internal networking took place. Nowadays, however, most people work in environments where they can have conference calls, messages lefton voice mails, and where all sorts of complex interrelationships exist between technologies. We must be careful that people are not inadvertently caught by the impact of the Bill through no fault of their own but because they had been used as a conduit for information

6 Mar 2000 : Column 786

that was intercepted by someone else. I hope that the Minister will clarify the way in which the measures will work in practice in the commercial and non-public sector, as defined by the Bill.

Mr. Fabricant: The hon. Gentleman has made a valuable point. Will the Minister clarify that financial institutions, which make a point of recording transactions that take place over the phone--I refer especially to telephone banking--will not come within the Bill's orbit?

Mr. Gapes: That is a question for the Minister; I shall not respond to it. The Home Secretary said that we needed to keep up with the advance of technology as best we can. The Bill is necessary and probably overdue. However, I suspect that, in a few years' time, it will be out of date. I hope that it will not be left for too long on the statute book--that has happened to other measures--before we review it and update it if necessary. During the Bill's remaining stages, I hope that we will be able to explore some of those matters in more detail. I hope that the House will support it this afternoon.

4.50 pm Mr. Simon Hughes (Southwark, North and Bermondsey): It is one of the little ironies of life that, on the day that one Labour Member decides to stand against another for the Labour leadership--[Interruption.]--all right, not quite the leadership, but they are both standing for mayor--in London, we are debating the Regulation of Investigatory Powers Bill. Some Labour Members may now be tempted to make the Bill as tough as they might ever dream of making it to deal with the latest developments. As we have said previously, the Bill--although complex--covers big issues. It is perfectly appropriate to examine it carefully because it takes us into areas where legislation has never gone before. The crucial question is: what should be the balance between the powers and rights of the state and the powers and liberties of the individual? The Home Secretary argued that the Bill would achieve a better balance, and my colleagues and I accept the proposition that if the state or state agencies are to investigate people, intercept communications and undertake surveillance, that should be regulated by law. It is accepted across the House that many activities are not currently regulated by law; they are either regulated by codes of practice or not regulated at all. As the hon. Member for Ilford, South (Mr. Gapes) said, technology is moving quickly. Mobile telephones, pagers and electronic mail have come upon us in the past few years and we need a regulatory regime. He was also right that in the next few years other forms of communication may arrive for which regulation will also be needed. It is clearly right to establish a framework of regulation and legislation and we must ensure that that which happens without legal justification is put into a context in which legal justification is required. There is no dissent around the House about that. Like the right hon. Member for Maidstone and The Weald(Miss Widdecombe), who spoke for the Conservative party, we on the Liberal Democrat Benches will therefore vote for the Bill's Second Reading. We need a Bill and it is important that the legislation catches up with reality. However, our view of the Bill as a whole is similar to that of the Conservatives: changes need to be made where, we believe, the Government have the balance wrong

6 Mar 2000 : Column 787

between the individual and the state, and we shall seek to amend the Bill. I was encouraged that the Home Secretary showed his open-mindedness--the Minister of State, Home Office, the hon. Member for Norwich, South (Mr. Clarke), has done that in other contexts--by agreeing to consider reasonable propositions reasonably and I hope that we can make improvements as a result. However, even before I listened to the right hon. Lady's speech, I had in my notes words to the effect that we must make it clear that we may not be able to support Third Reading unless improvements are made. I want to flag that up and hope that it helps the Government to realise that not only are there concerns among those on their own Benches and outside the House, but that both Opposition parties want changes to be made. To get the Bill right, we are willing to work with the Minister and each other.

The Minister of State, Home Office (Mr. Charles Clarke): And Ken Livingstone.

Mr. Hughes: The Minister tempts me. If the hon. Member for Brent, East (Mr. Livingstone) turned up at any of the debates on the Bill, no doubt we could work with him, too. Some of us did not stand for that particular election, not least because running a campaign out there and doing a job in the House seemed incompatible, but that is a separate debate. I want to flag up a warning about the Bill's dangerous provisions, as those in which we think the Government are going too far in favour of the state and against the individual are part of a worrying trend. I occasionally crossed swords with the hon. Member for Ilford, South--who is not in his place, but was a moment ago--in Committee debates on the Terrorism Bill. The Minister was also a member of the Committee. Two of my complaints were that the definition of terrorism was too wide and that making the legislation permanent was not a good idea. There are the same underlying concerns about this Bill: that the definitions are too wide, that powers given to Ministers are too great--my right hon. Friend the Member for Berwick-upon-Tweed (Mr. Beith) referred to that and I shall come back to it later--and that the balance is wrong. The House is also debating the Freedom of Information Bill, which does not give the citizen enough powers and does not take enough powers away from the Executive. Tomorrow, we shall discuss on the Floor of the House a Bill that will take more rights away from the individual and give more powers to the authorities. I must tell Ministers and Labour Members that the Government have got the balance wrong. They were not elected to take more and more rights away from individuals and to give them to the state, but they are doing just that. These measures may have a populist and popular short-term appeal, but if they continue down this road they will increasingly lose support not only in their heartlands, but in other places where people are concerned about these issues too.

Mr. Fabricant: The hon. Gentleman cannot have it both ways. He cannot say that the Bill will have to be

6 Mar 2000 : Column 788

updated in the light of new technologies, and then say that it is so broad that it encompasses all future technological possibilities.

Mr. Rogers: Of course the hon. Gentleman can have it both ways--he is a Liberal Democrat.

Mr. Hughes: Had I said that, the point made by the hon. Member for Rhondda (Mr. Rogers) may have been valid, but I did not say that. I said that we shall have to ensure that legislation encompasses the developments in technology, but the Bill is too broad because it gives the Secretary of State the power to designate, without coming back to Parliament with legislation, any body that has the right to intervene. Furthermore, definitions of the national interest in one form or another, that are not defined elsewhere in legislation, allow a wide interpretation. I did not suggest that the Bill was too wide in the way the hon. Member for Lichfield (Mr. Fabricant) implied. My right hon. Friend the Member for Berwick- upon-Tweed and I are not persuaded by the argument for giving the Executive greater powers to interfere in the lives of individuals. The Secretary of State illustrated the point by saying that whenever he is asked whether someone has had his telephone tapped he is unable to give an answer. However, people would be less reassured to know that the decision is being made by a Minister, who is part of the Executive and in charge of the police or certain parts of the intelligence services, than they would be if it were taken by a member of the judiciary. The separation of powers is very important, not least because we do not have a written constitution. I disagree with the Minister. I believe that the public would be more reassured if judges, who are not part of, and are free from, the Executive, made such decisions and not Ministers, however well they may carry out their responsibilities. Although Ministers have not been criticised for abusing their powers, that does not mean that they will not face temptation and will not give into it. The right hon. Member for Maidstone and The Weald properly argued that we must get right the difficult balance between regulation and a liberal trading and commercial society. That is not easy. We want to ensure that there is maximum opportunity for global commerce, but clearly the internet, e-mail and other forms of communication allow transmission of illegal material--pornography is a good example. Such material is much more accessible now than ever before. Parents raise such concerns with us all the time. That material needs to be regulated, because people do not want their kids to be able to download it in their front room. Kids often play a double bluff with parents to find out the password and to access such material. The Secretary of State may tell us that he is advised that the Bill complies with the European convention on human rights. As of October this year, that will be able to be tested in the courts. Having engaged in a couple of seminars and discussions, I do not think that this country has begun to understand the impact that the human rights legislation will have on people's lives, or to realise how many court proceedings will take place in magistrates courts, county courts, Crown courts and the High Court to test that legislation. The two main issues here are the right to fair trial and the right to privacy, both of which are enshrined in the convention and tested in this Bill.

6 Mar 2000 : Column 789

Let me make a more general point. We are living in an age in which we must ensure that the individual can resist the requests made to all of us to give information all the time, often unnecessarily. I can give a practical, not very exciting example. When someone telephones one of the statutory undertakings to pay a gas, electricity or water bill, that person is often asked for all sorts of information beyond his or her postcode. More and more information is required from those who want a loan or bank overdraft. The danger is that, in our present society, the information held on us is growing, while the information that we have about who is holding it diminishes in relative terms. The ability to keep up with who controls the information is a real issue in respect of the rights of the individual, not just against the public state but against private corporate society, nationally and internationally. The other day, I visited a prison and saw how it monitors prisoners' activities. Obviously, the issue is different in prisons, but I was struck by the detailed computerised tables enabling those in authority to track connections, conversations, links and meetings. They can listen in to telephone calls, and play back calls made a month or two earlier. The police do the same on a regular basis. I have examined some of their activities as well. They can trace telephone calls, and can tell where they are being made from and to. There is a huge collection of information, not all of it lawfully and properly obtained. As the Home Secretary reasonably said, the Bill is not just about discovering what is being said by intercepting communications, but about discovering what communication is taking place--who telephones whom and when they telephone, who visits whom and when they visit. That is a different issue, involving a whole different set of information--even if those concerned do not actually hear what is being said by sitting in or bugging conversations. I believe--as do others who have written to all of us, including the organisation, Justice, and as does the data protection commissioner--that it would have been better to have two general regimes rather than nine to deal with the different kinds of intervention and interception. There are nine--arguably more, but certainly nine—regimes of control, some of which have Secretary of State authorisation: that applies to interception of communications under part I, intrusive surveillance in the context of bugging and burglary, and intelligence and armed forces surveillance. Other regimes have circuit judge authorisation, commissioner authorisation, designated persons authorisation or self-authorisation in the case of, for instance, the police. Although we have one tribunal, which is a good thing, we might well do better as legislators, in the interests of the citizen who wants to know what is going on, if there were only two methods of giving authority and two methods of judging. There are various specific questions about definition. I hope that we will look at the definition in clause 25, whereby surveillance is regarded as intrusive if it involves residential premises or private vehicles, but business places, for example, are not mentioned. The definition of what is covert in clause 25(8) has been criticised, because it does not depend on whether someone believes that a surveillance operation may be in progress. The data protection commissioner, among others, argues that it should. Clearly, there are issues of definition as to what

6 Mar 2000 : Column 790

is a private telecommunication system and what is a public one in relation to being able to control people in the workplace. Several definition issues like these need to be resolved. Bigger than that are the great powers that the Bill leaves to the Secretary of State to designate other bodies to do the interception, or surveillance. My right hon. Friend the Member for Berwick-upon-Tweed gave an example, which comes up in clauses 6, 27 and 29. The Child Support Agency, a Ministry of Agriculture, Fisheries and Food inspector and all sorts of people could be designated. We should put those in the Bill and not allow as yet unknown, relatively lowly officials to be able to have what are very wide powers. It may be proper to allow an official in the middle of the night to authorise that telephone bugging can change from one number to another when someone changes their phone number, but it should not necessarily go wider than that. A much more worrying issue is the definition of the purpose for which one can intercept communication. I hope that we shall look at two definitions again. One is the definition of serious crime. Wider and more worrying is the definition--it comes up, for example, in clause 5(c)--that says that a warrant is necessary on grounds falling within this subsection if it is necessary . . . for the purpose of safeguarding the economic well-being of the United Kingdom. That is a very wide definition. As far as I am aware, it is unqualified elsewhere in the Bill. All sorts of things could be regarded as necessary to safeguard the economic well-being of the UK: ensuring that the stock exchange did not collapse, or that the pound was not affected. However, it could be much less significant than that.

Mr. Rogers: Surely the hon. Gentleman will accept that that definition is in the Security Service Act 1989 and the Intelligence Services Act 1994. It is simply an extension of that.

Mr. Hughes: I accept that. Like the right hon. Member for Bridgwater (Mr. King) and my right hon. Friend the Member for Berwick-upon-Tweed, the hon. Gentleman deals with these matters regularly. I still think that we should look at whether the definition is not too wide. As he knows, the Bill does two things: it replicates old legislation and adds new. I hope that he does not believe that, just because it is in the old Act, we should not review whether the definition is too wide. There are also issues to do with the tribunal and how one deals with complaints. Of course, we are in a bizarre Alice in Wonderland situation: people do not know necessarily that they are having their communications intercepted, so how can they complain about it? None the less, people do complain about that fairly regularly. I think that, without exception, complaints have not been upheld so far; none has been upheld at all. I hope that that is because interceptions have all been done scrupulously and not just that we have presumed that they have been. I give the authorities the benefit of the doubt. It may not always remain the case. Other countries and regimes--perfectly reasonable neighbour countries of ours--have a more open and accountable system for complaints and for registering what has happened, which allow decisions to have reasons attached to them and people to be able to see the reasons.

6 Mar 2000 : Column 791

I should like us to look again at how citizens can at least be informed better about any complaints that they have and the adjudication on them. Another big point that was raised by the right hon. Member for Maidstone and The Weald and that has been raised widely with us is to do with encryption and, to use shorthand--it came up in the Terrorism Bill--what is called the reversal of the burden of proof. Big-deal criminals may be more likely to remember the passwords, code or key than hon. Members, who may have more than one password at any one time. I certainly do. The password for my mobile phone is different from the one that I use to send e-mails. Indeed, we cannot help having to change our passwords because the House of Commons system changes them anyway, as do other systems, to ensure that they are not kept regularly. Yesterday, I went to my office to deal with some correspondence and was told that my old password had expired and that I had to change it. Not surprisingly, some people forget their passwords, whereas others do not. We shall have to deal with the fact that some people, perfectly reasonably, may not be able to remember or gain access to their password or code. Mr. Ian Bruce: Will the hon. Gentleman give way?

Mr. Hughes: I shall not, as other hon. Members wish to speak and the hon. Gentleman has already intervened. We cannot place on the accused a burden of proof as severe as that proposed in the Bill. I hope that we shall change the provision, and create a much more reasonable system governing the interception of encrypted material and the application of the balance of proof. We should also address some more minor issues in the legislation, such as the failure to provide for privileged material. There are also some practical difficulties, such as how the Bill distinguishes between monitoring material and monitoring the contents of material. Another problem is the Bill's provision that interception would be lawful if only one of two communicating parties consented to it. One party's consent should not be sufficient to constitute a valid interception. For most of those for whom we legislate, the Bill, at least superficially, seems neither relevant nor interesting. However, it is as important as anything that we do in this place, and we must get it right. I hope that we shall be able to adjust the balance that is struck in the Bill in favour of the citizen and against the state. I also hope that, by collaborative effort, we shall be able to improve the Bill, because it certainly needs to be improved.

5.11 pm Mr. Harry Cohen (Leyton and Wanstead): I should like briefly to deal with chapter II, clauses 20 to 24, of the Bill. My objective is an assurance that the Bill will provide for proper safeguards for the privacy of individuals. I am concerned that, currently, the Bill seems to be deficient in providing for them. The White Paper entitled "Interception of Communications in the United Kingdom", Command Paper 4368, was published in the summer of 1998. In Chapter 10, on the

6 Mar 2000 : Column 792

provision of communications data to other bodies, the Government state: the analysis of communications data can provide much information about the way in which people live their lives and that access by the authorities to such data can provide valuable intelligence. However, the White Paper also recognises--and I agree--that there is a balance to be struck between the privacy of the individual and the needs of society as a whole to be protected from crime. The White Paper adds that access to communications data--for example, which telephone numbers have been called, for how long, and when they were called--will be subject to a code of practice. However, I note that in clauses 62 and 63 of the Bill, on codes of practice, there is no mention of involving the data protection commissioner. Some observers who are less charitable than I am might therefore draw the conclusion that the Government's intention is not to refer the code to the official who is tasked to protect individual privacy. Will the Minister give a commitment that the code of practice will be approved only after full consultation with the data protection commissioner and that the DPC's recommendations will be included in the code? Will he also give a commitment that when a recommendation is not included in the code, the Government will give a full explanation on each detailed point? In the White Paper, the Government propose that access will be legitimised in dealing with: the prevention or detection of crime; . . . the apprehension or prosecution of offenders; . . . the interests of national security; . . . the purpose of safeguarding the economic well-being of the United Kingdom; . . . the urgent prevention of injury or damage to health; and . . . the assessment or collection of any tax or duty or of any imposition of a similar nature. Those factors of legitimation find expression in clause 21. I should like to focus on the last factor, on the collection of taxes. In reply to a parliamentary question on the application of section 29 of the Data Protection Act 1998, I was told that the assessment or collection of any tax or duty or of any imposition of a similar nature meant that the phrase is likely to include national insurance contributions and the council tax but not fines.--[Official Report, 8 April 1998; Vol. 310, c. 262W.] It therefore follows that the "balance to be struck" in the Bill includes the possibility of the disclosure of communications data, if properly authorised, for purposes such as collecting national insurance contributions or road traffic tax. Given that these taxes are, at most, a few pounds a week--less than the cost of a cappuccino per day--some might find this wide-ranging power to be a disproportionate use of state power. There seems to have been a loss of balance here, and I hope that the Minister will explain that. Do the Government need to modify the non-disclosure provisions in the Data Protection Act? For example, suppose the police could obtain communications or personal data about an individual. Is it the Minister's intention that such personal data could be communicated to local authorities for the collection of council tax under section 29 of the Bill, should the police decide to volunteer such data--perhaps even if the police were asked to do so by council officials? I would like the Minister to consider this matter and, if appropriate, 6 Mar 2000 : Column 793 write to me about it. I am not convinced that the collection of run-of-the-mill bills is a suitable justification for phone tapping, e-mail tapping and the general interception of communications. Again, I hope that the Minister will provide an explanation. The major change proposed by the Bill is one of compulsion. Most disclosure categories identified in clause 21--for example, crime prevention--can already occur legitimately under the Data Protection Act without the need for new legislation. The only difference is that, under the Act, disclosures are legitimised on a case- by-case basis where the data controller--the telecommunications company--has to be satisfied with respect to the conditions. The controller always has the option to refuse to disclose. Under the Bill, the data controller has no choice but to disclose if an official or officer claims that the demand for the personal data is justified under the criteria outlined in the Bill. In addition, it is not clear whether disclosures could be wider than the case-by-case disclosure of the Data Protection Act. For instance, instead of a disclosure relating to specific individuals, the provision could permit the disclosure of a database, so that the authorities could then select what might be useful. Will the Minister state that requests will not relate to whole databases of information? Will requests be limited to case-by-case issues where the demand for information is limited to simple, precise circumstances? How will Minister stop these clauses being used for fishing expeditions, which would invariably breach privacy? I request clear answers to those questions before the Bill becomes law. The Government have not yet presented evidence that the current voluntary arrangements under the Data Protection Act have failed, and that compulsion is therefore necessary. I ask the Minister a simple question--have some telecommunications operators not co-operated with the police and other authorities, if asked? Will the Minister provide the evidence that the current voluntary arrangements have failed and that compulsion is needed? If he cannot, why is this change being made? On warrant signing, the latest report into the operation of the Interception of Communications Act 1985, Command Paper 4364, shows that, in the last full year of the previous Conservative Administration--under the then Home Secretary, the right hon. and learned Member for Folkestone and Hythe (Mr. Howard)--1,073 intercept warrants were signed. By contrast, in the first year of this Government, my right hon. Friend the Home Secretary presided over an increase of more than 50 per cent., and 1,646 warrants were signed. That is between six and seven a day. We need an explanation, if only to reassure hon. Members that my right hon. Friend is not suffering from repetitive strain injury. We have an intelligence services commissioner, a security service commissioner, a parliamentary commissioner, a Police Complaints Authority and a data protection commissioner--the last two have expressed an interest in national security and policing issues. Now, two more commissioners are proposed by the Bill. In the House, national security issues are in the remit of the Home Secretary, the Foreign Secretary and the Intelligence and Security Committee established by the House. However,

6 Mar 2000 : Column 794

are any of them performing a proper scrutiny role, or are they merely rubber stamps in approving the security services' activities?

Mr. Rogers: I wish to correct one point made by my hon. Friend. There will be only one extra commissioner under the Bill, because there is already an interception commissioner.

Mr. Cohen: That was not the point made by theright hon. Member for Maidstone and The Weald(Miss Widdecombe), who referred directly to two commissioners. Perhaps the Minister will also clear up that point. In any case, there is still a proliferation of such commissioners and my point is whether any of them will perform a proper scrutiny role.

Mr. Campbell-Savours: I am sure that my hon. Friend has great confidence in Lord Nolan.

Mr. Cohen: It is not a matter of the individuals, but the powers that they have and the systems that are in place. I have much confidence in the members of the Intelligence and Security Committee--my hon. Friend is one--but I am still not especially happy with the outcome of their reports, which have not had the level of scrutiny that I would have liked to have seen from such a committee.

Mr. Heald: Is the hon. Gentleman's memory the same as mine--that the Intelligence and Security Committee has recently employed staff so that it can be more proactive? Does he agree that something along those lines for the commissioner would also be a good idea?

Mr. Cohen: That would be welcome. I would like to see the whole system streamlined and given teeth and a degree of independence, so that it can give proper scrutiny. Does the system see only what the security services want it to see? Judging by the lack of critical reports, the security services seem to be perfect model organisations. We all know that that is not so. Until we get the scrutiny arrangements right, more legal powers for the security services to do what they like do not seem to be appropriate. Will any of the commissioners be given teeth for their powers of scrutiny? The public want reassurance that the agencies that are given wide-ranging powers--which, I readily acknowledge, are often necessary--will not abuse those powers. However, the responsibilities of those who act as public watchdogs are spread thinly across an increasing number of organisations. Although the various commissioners probably try their hardest to wield their limited powers, the diverse regulatory structure weakens the protection afforded to individuals. Will the Government ensure that the commissioners are at least under a statutory duty to communicate with each other to determine who has responsibility for investigating a complaint? I believe that much more fundamental change is necessary to ensure proper investigation of all complaints and to keep the short-cutting elements of the security services in check. I shall monitor the progress of the Bill in Committee and, if necessary, table suitable amendments on Report.

6 Mar 2000 : Column 795

5.23 pm Mr. Ian Taylor (Esher and Walton): I am grateful for the chance to speak in a Home Office debate. It is not something that I have done often, but it is obviously an enlivening experience that I shall wish to repeat. My reason for doing so is that there has been a deft transfer of parts of the Bill from the Department of Trade and Industry, in which I was once a Minister, to the Home Office. In fact, the transfer is probably appropriate. In March 1997, I issued a consultation document on some of the issues relating to the problems of encryption, and how the security services and the police would get access to decrypted plain text. That created a furore which, at the time, I disputed, but--as I said in debate on the Electronic Communications Bill--I have since recanted. It was clearly not appropriate to adopt a statutory trusted third-party system, with a key escrow structure. The Government have been right to listen to industry's demands and introduce this Bill. The difficulty acknowledged by several hon. Members so far is that the matter is hugely complicated. Although I do not agree with everything that he said, the hon. Member for Leyton and Wanstead (Mr. Cohen) dealt perceptively with the human rights and individual liberty aspects of the Bill. I shall therefore focus on matters that I used to understand when I was a Minister. The technology has progressed apace. There is now a proliferation of communications service providers, and they can communicate in a wide variety of ways. The old way used to be by fixed-link telephony. I hope that the Minister will tell the House whether some of the restrictions placed on the old BT-Mercury duopoly that operated until 1991 still apply. Is it still a requirement that the relevant companies' chairmen or chief executives must be British? I remember having to deal with the consequences of that requirement when there was a prospect of an American coming to take charge of Cable and Wireless. I had to ensure that the chairman remained British. Those idiosyncrasies had a purpose at the time. The House understood that they were important, as my right hon. Friend the Member for Bridgwater (Mr. King), who chairs the Intelligence and Security Committee, will confirm. However, they have been well and truly bypassed. I recall signing 150 licences for international telecommunications, and hundreds of others for resale purposes. A multiplicity of companies have entered the sector. Some are small, some large, and some are subsidiaries of other companies. The result is that the old way of doing things, by gentleman's agreement almost, has long since gone. I mentioned the wide variety of service delivery methods. As well as fixed-link telephony, wireless and mobile communications are also commonplace now. There will soon be fixed-link wireless telephony systems, and cable is increasingly taking over telephone and television transmission. It shows how long it takes to realise a good idea that today just happens to be the day of the auctions for the third-generation universal mobile telephone system, as I structured and devised that auction system in 1996. It is good to see one's baby born, but the process is elephantine.

Mr. White: Is the hon. Gentleman aware that the former Conservative Front-Bench spokesman on trade and

6 Mar 2000 : Column 796

industry matters, the right hon. Member for Wokingham (Mr. Redwood), claimed that the measure to which the hon. Gentleman referred should never have got past the civil servants, and that it was the worst piece of legislation that he had ever seen?

Mr. Taylor: I cannot claim always to have given birth to beautiful babies, but the parliamentary draftsman must have got in the way of a brilliant idea. The process is exciting, but it has taken time because of the need to achieve international standards. I do not want to get sidetracked by the specifics of the technology, but the important point is that full multi-media access will be available to users of mobile phones. That will cause problems for the services that are required to carry out interception. The industry is international. The Bill contains provisions to determine where telecommunications services are located, and whether a service is known to be delivered from outside this country. However, those technical points can be revisited in Committee if necessary, and I believe that some points at least are worthy of clarification. The state has an interest in protecting its citizens from criminals and transactions that are designed to undermine the legal framework. These matters can also be extended to terrorism, where it is important that the Government have powers to intercept on clearly stated grounds. The Bill will need to be evaluated carefully in Committee, but the process of stating clearly the terms on which a particular interception can be made should be set out. That is right and proper. Part III of the Bill deals with the investigation of electronic data protected by encryption. Bearing in mind that the companies involved in the industry are very varied, my concern is that the proportionality of the burden placed on them is openly discussed and understood. Unless it is, there will be considerable industry opposition. There is no doubt that companies that have moved into this sector have not taken this into account. They may not have budgeted for it, or understood some of the technological changes that must be taken on board if they are to conform to these provisions. It will be important to deal in Committee with matters on which I am sure the Home Office has consulted, but to which I have heard reactions from the industry. With regard to previous drafts of the Electronic Communications Bill, there were concerns in the banking and financial communities, which operate in the global market, about who was being given the powers to request the disclosure of keys. This Bill refers to any person with appropriate permission. I am not a lawyer, and I am sure that lawyers will have a field day in considering these matters. It is essential that the companies that are subject to these laws understand who they will be giving their private keys to because of the need to protect their confidentiality and commercial-in-confidence criteria. Are those fully understood by the people who will be asking to have private keys and decryption provided? I would be happier if the Home Office were more explicit in expressing its understanding of these matters. Perhaps someone in the Department of Trade and Industry, as I was, understands the importance of subjects such as commercial-in-confidence. I would be grateful if the Minister were more open about it.

6 Mar 2000 : Column 797

The Home Secretary had an interesting exchange earlier about whether he could tell anyone that his telephone was being tapped. I quite understand his answer. Nevertheless, when it comes to confidence in the world of global commerce, it is important to know whether encryption has been entered into and looked at, and whether the private key has been sourced. The inability to tamper with a system is vital, as is confidence that, once encrypted, it is safe and not likely to lead to any commercial loss of security. The integrity of private keys must not be unreasonably jeopardised. If they are, companies will have to consider factors such as the need for global key revocation and change, which will be costly. Those factors are in addition to the existing cost element. The Home Office stated that it might contribute to the costs of interception, heavily underlining the word "might". I am not quoting exactly from the Bill, but I am sure that the Minister knows what I am saying. There is no obligation for the Government to pay up. If those matters are left unclear during further discussions on the Bill, some companies will decide to locate offshore under regimes with less intrusive security measures. Other hon. Members have put questions about definitions. In clause 52, a definition of "key" is provided that may be a little too vague for comfort. It states that "key", in relation to any electronic data, means any key, code, password, algorithm or other data the use of which-- and so on. That seems to be a pretty general definition, and unless it is tightened up it will cause considerable problems. There are other problems of definition in the clause--for example, in subsection (4) reference is made to "intelligible" and to something being put into an intelligible form. That provision needs to be examined closely--although not necessarily redrafted--to test the full meaning so that people who may be subject to it know what they are being asked to do. At the beginning of my speech, I should have mentioned that I have various technology interests outside the House, and they are declared in the Register of Members' Interests. Although I do not think that they are relevant to the debate, I should have taken the precaution of declaring them at the beginning. However, my interests do enable me to understand that Bills such as this need wide public discussion. We have visited the human rights difficulties on several occasions--in respect of terrorism legislation and many other matters. Such debates are in the normal realm of our proceedings in the Chamber. However, some of the technological problems will be difficult to grasp--for example, because of the way in which companies increasingly sift their own data through test marketing or the use of cookies in a system to find out which data are being used and how. We must keep such matters separate from the Bill. The hon. Member for Southwark, North and Bermondsey(Mr. Hughes) made it clear that there are large distinctions between a private and a public telephone system. However, private telephone systems can now be global; they do not exist merely inside an organisation but within a building, where new technological breakthroughs such as Bluetooth mean that almost everything connects with everything else. Currently, it is virtually possible not only to communicate between one system and another within a building, but to do so globally through intranets and private network systems.

6 Mar 2000 : Column 798

There will be problems if the Bill catches people who are doing things in a corporate environment that they had not realised would be subject to the scrutiny proposed by the Government. Industry needs to understand fully what the Government intend. As one would expect, the Government's intentions are fairly openly declared in the Bill. Nevertheless, the purpose behind them sometimes needs better explanation. It is vital that the cost elements and the burdens on individuals are properly understood. When I intervened during the speech of my right hon. Friend the Member for Maidstone and The Weald (Miss Widdecombe), my purpose was to obtain reassurance from the Minister that the attempt to make the penalties as draconian as possible would not mean that almost every company would want to ensure that it placed its private keys with some trusted third party, so that are forced back to a key escrow system. I do not think that the Minister intends to do that, but I should like clarification on that point. Such matters should be properly scrutinised in Committee. I wish the Bill well on Second Reading.

5.39 pm Mr. Tom King (Bridgwater): The House is familiar with the considerable technical and ministerial experience that my hon. Friend the Member for Esher and Walton (Mr. Taylor) has in this subject. He raised serious issues that our consideration of the Bill will need to address. I am the Chairman of the Intelligence and Security Committee, which the House charges with responsibility for the intelligence agencies. The Bill is of direct interest to the agencies and to the Committee because it deals with several matters that go to the heart of their activities. Other hon. Members, including the hon. Member for Southwark, North and Bermondsey (Mr. Hughes), referred to the knowledge that I and members of my Committee have in this subject and the Committee suggested that I should intervene in the debate to make certain comments about the Bill. In doing that, I do not wish to frustrate other hon. Members of the Committee who wish to take part in it. The Committee is familiar with the challenges that the intelligence agencies face with issues of national security. We are aware of the threats that we face from different terrorist organisations and the technological skills that are available to them. Some of those skills enable them to avoid more conventional methods of surveillance and interception, so the issues raised by the Bill are important. The Committee would be the first to say that our familiarity with the gravity of the threats to our national security and from serious organised crime does not in any way breed contempt for the need to strike a proper balance. Human rights and the proper protection of the privacy of the individual are important considerations. It is a particular duty of members of the Committee to take account of that balance because we are privy to information on activities and threats that cannot be made available to hon. Members and to the wider public. Sometimes those threats are referred to in lurid and anecdotal terms by those who seek to justify legislation in one form or another, so the Committee has a particular responsibility to be sensitive to the need to protect human rights. We must examine seriously whether the balance is being maintained, how great the threats are and how far the Government and Parliament should go to ensure that proper protections exist.

6 Mar 2000 : Column 799

The word "balance" has been used in every speech in the debate. We must take account of that in the procedures that are adapted to the new and major challenges that we face. It is a time of massive technological change and questions have been asked whether interception, in its traditional form, is possible for the new means of communication that are available. Private networks are often referred to as though they are head office or internal telephone systems. However, my hon. Friend the Member for Esher and Walton made the interesting point that such networks can operate globally. The development of so many systems and providers presents a major challenge in how we approach interception. My hon. Friend pointed out--I did not know this--that the chairmen of British Telecommunications and of Cable and Wireless once had to be British citizens. I doubt whether anyone, even the Minister, knows the nationality of the chairmen of the various companies that now provide communications networks in this country. Perhaps between now and the wind-up speeches we should try to establish all their different nationalities. If we are to have different providers, all of whom have to provide an intercept capability, there is not only a question about the cost of that provision, but a great sensitivity about the fact that interception is even taking place. From my experience in previous incarnations, I know of the serious concerns about the security of information, and from my time in Northern Ireland, I know of the sensitivity that exists about what interceptions are taking place. We are to have a host of different providers of different nationalities. It is difficult to identify where some companies are based, where their head office is or what legislation they are covered by. Those issues will need to be examined carefully in Committee and we shall have to consider how workable the legislation is. We are no longer dealing only with good old BT. The establishment of Mercury seemed, at the time, a radical innovation, but now we have a host of other providers. The second issue, which the Intelligence and Security Committee has considered and which the Home Secretary referred to, is whether we should have judicial or executive authority for warrants. The issue by a Secretary of State of warrants for interception or covert intrusion legalises illegal acts, because without a warrant such interception is illegal, as the Bill makes clear. This country has been under fire for a considerable time for not placing the issue of such warrants on a judicial basis. I hope that this remark will not seem too offensive to some people, but I am conscious that in some countries it would be extremely difficult to operate the system for issuing warrants on a political basis. I can think of a number of countries, including even fellow members of our great union, in which certain members of the Government have been accused of organising the interception of communications to other members of the Government. I remember a Government that fell over that issue, when it was found that the Prime Minister had arranged with the Attorney-General to intercept communications to members of the Opposition. It is understandable that public sentiment in several countries is that there must be a judicial system for the issue of warrants.

6 Mar 2000 : Column 800

I agree with the Home Secretary, however, that a judicial system is not always the best protection for the rights of the individual. I recall that in Northern Ireland we were attacked because we held people without charge for as long as seven days. That was considered a major breach of their human and legal rights, and we have reduced the maximum period to five days. I have mentioned before in the House the Eksund, a ship that had come from Libya loaded with arms on their way to the IRA, which was intercepted by the French authorities. That was a very fortunate interception, as the armaments in the shipment would have caused huge suffering. The people who were arrested and held in France under the order of an examining magistrate--that made the order judicial--were held for two years without charge. That would be absolutely unthinkable under the British system, where we were criticised for holding people for seven days. We need to think more carefully before we move to a judicial system, which people say is bound to be fairer and to provide better protection for the rights of the individual. I certainly endorse the present system, although doing so is, in a sense, special pleading because I had responsibility for such warrants. They were very carefully examined, and one was extremely conscious of the need to ensure that scrupulous attention was paid to them and of the fact that they would be examined--as they were by the predecessor to Lord Nolan, whose name I forget. The hon. Member for Southwark, North and Bermondsey(Mr. Hughes) said that the tribunal never found in favour of a complainant, but I certainly rejected certain applications for warrants because I knew that I had a duty and could be held to account for their issue.

Mr. Simon Hughes: I am following what the right hon. Gentleman is saying. Does either he or his Committee have a view on whether there would be a case for treating differently interception on the grounds of national security and of crime? The data protection commissioner argues that we could reasonably justify judicial control over crime and security matters while retaining administrative ministerial control over national security matters.

Mr. King: I can answer that very quickly: the Committee has not discussed that matter. I would need to reflect on it, but I am not instinctively attracted to such a suggestion. However, we have a problem; there is no doubt that the system is under fire. I happen to believe that our system of Executive action is absolutely justifiable and defensible. As an Opposition Member, I have confidence that the present Home Secretary will discharge such responsibilities fairly. Although the system is a perfectly good one, it will be very hard to sustain.

Mr. Rogers: Would it not be true to say that the three aspects with which the Committee is concerned--terrorism and criminal activity, national security and economic well being--often overlap and that we cannot separate terrorism from, for example, drug activity? In fact, one often funds the other, so it would not be easy to split up warranting in the simplistic way suggested by the hon. Member for Southwark, North and Bermondsey (Mr. Hughes).

Mr. King: I am grateful to the hon. Gentleman, who is a very experienced member of the Intelligence and Security Committee. His point is valid and an important consideration.

6 Mar 2000 : Column 801

Mr. Campbell-Savours: In simple language, is not the reality that we can remove politicians and Ministers, but we cannot really remove judges?

Mr. King: There is an obvious and initial attraction in referring to a judicial authority as apparently quite separate from Executive political action, but the tradition in this country of a non-political civil service serving Ministers who have statutory duties has stood the test of time. I am not aware of any allegation at any time of political motivation in the signing of a warrant, but I am afraid that the same cannot be said for certain other countries where different systems operate. The Committee sees the merit in the unification of tribunals. The establishment of a single tribunal seems to be a sensible step. The effectiveness of tribunals is certainly not helped by there being different ones or by adding to confusion. A single one should be more helpful to people who are trying to identify their point of reference when making a complaint. The Committee has not commented on--and has discussed only briefly--what might be seen as a proliferation of commissioners and whether it is necessary to have so many. On the point about their effectiveness, I am grateful for the alertness of my hon. Friend the Member for North-East Hertfordshire (Mr. Heald) in respect of having an investigative arm in support of commissioners. On the concern of the hon. Member for Leyton and Wanstead (Mr. Cohen), we have indeed appointed an investigator. We have enhanced our capacity in that sense, which the Committee believes to be important. It will add to the effectiveness of the Committee's work. I turn to encryption--a matter on which the Committee has taken evidence and has considered. The House will be familiar with its most recent report, in which it says in paragraph 73: The Home Office stated that 'It is, however, the potential use of encryption rather than its current application which gives rise to the greatest concern. Communications technologies are converging around common digital protocols in a way which will soon allow new encryption methods to be applied equally to voice as to internet data traffic. When that happens, if nothing were done, the valuable interception capability would be progressively lost to the law enforcement services and to the Agencies'. Being mindful, and having some knowledge, of the importance of some of the interception that has taken place, the Committee concludes: We therefore welcome the Government's proposals under the Electronic Commerce Bill to include powers to issue orders for the production of keys held by any person where they are required in order to decrypt material which has been, or is being, lawfully acquired. We understand that this will include interceptions under the Interception of Communications Act 1985 which is currently also under review. That comment was in anticipation of the production of this Bill. I have seen outside comment on these matters, to which my right hon. Friend the Member for Maidstone and The Weald (Miss Widdecombe) referred. The report of the Foundation for Information Policy Research was written by an extremely experienced civil servant who--I think--worked in the Ministry of Defence for 30 years and held a very senior position before recently leaving to become a consultant. He made three points. First, is there really a need for such provision? I speak on behalf of the Committee when I say that there is aneed for some such facility. Secondly, the foundation

6 Mar 2000 : Column 802

recommended that access and provision of keys should not at all times be required but that at least a transcript should be made available. In that connection--the point seems to be extremely relevant to the question of the key--how many people are we talking about? How many companies, providers and encryption service providers will have to be approached at one time or another? Who will be doing the transcribing of what might be extremely secret or sensitive information? What control will there be over that? Thirdly, if keys are to be provided, there must be proper protection of them, as they are extremely sensitive. The author of the report said that, if we went by the cost to the Ministry of Defence and GCHQ, ensuring the security of such keys for some companies could cost hundreds of millions of pounds. That may be special pleading, although the figure is substantial regardless of whether we divide it by two, 10 or whatever. The Minister might like to comment on that, and hon. Members may want to discuss it in Committee. In general, the Committee believes that this is a necessary and sensible Bill. It modernises the Interception of Communications Act 1985, moving it into the21st century. It seeks to take account of some of the developments in this rapidly changing world. As the hon. Member for Ilford, South (Mr. Gapes) said, the speed with which the world is changing gives us the clearest guidance that it will continue to do so rapidly. If interception is to continue to be an effective aid to the protection of national security and the national interest, we shall have to discuss, in five or 10 years' time, things that have not yet been invented. Against that background, the need to modernise now is clear, but as that modernisation occurs and the challenges become greater, we must at all times bear in mind the proper protection of the citizen, his privacy and his rights. Although the Bill's Second Reading is not likely to be opposed, major difficulties and challenges will be thrown up in Committee. However, on behalf of the Intelligence and Security Committee, I welcome the introduction of the Bill. I shall watch its passage with great interest.

6.1 pm Mr. Brian White (Milton Keynes, North-East): Given that my wife used to work at Bletchley Park, it is appropriate for me to contribute to the debate on the Bill. Before I commence, I should declare that Caspar Bowden, who is a director of the Foundation for Information Policy Research, is a researcher of mine. However, the comments and views he has advanced under the FIPR banner are his own and have nothing to do with me. I shall not detain the House long, but I want to raise a couple of points that cause me concern. In part, they echo points raised by the hon. Member for Esher and Walton (Mr. Taylor). However, I should make it clear that I support the principle of the Bill. The Bill started life as part III of the Electronic Communications Bill. At that time, I wrote to my right hon. Friend the Home Secretary expressing my concern. Despite his reply to that letter and his response to my intervention earlier today, I still have doubts. My main concern about the Bill's construction is that it will be impractical because of technological change, and unfair because innocent parties who happen to operate the technology will be caught by it, not criminals. It has the 6 Mar 2000 : Column 803 potential to damage e-commerce in this country, although that is because of the perception it will create, not the reality. Finally, the Bill does not really address e-crime. However, I hope that my hon. Friend the Minister shares my belief that amendments in Committee will alleviate my concerns and turn the Bill into a good one.

Mr. Heald: Does the hon. Gentleman accept the analysis by Caspar Bowden of the FIPR of clause 12, which deals with interception capability on the internet? He says that it will be extremely difficult to find a way to intercept communications sent using split-packet technology, which sends many messages in small parts in many different directions at once.

Mr. White: I would not say that it is impossible, but it will be extremely difficult. One of my concerns is that changing technology means that the armoury available to law enforcement agencies will not be up to the job. Before addressing part III, I have one comment to make on part II. The data protection commissioner has regularly criticised blanket national security exemptions that preclude any inspection or enforcement. The Bill does not rectify that problem, as I hope Ministers have noted. Under the Bill as currently constructed, an individual is presumed guilty if he is properly served with a notice with which he does not comply. I accept that some improvements have been made since similar proposals were made under the Electronic Communications Bill, but the basic problem remains. The Minister will say that there is a statutory defence, whereby that individual demonstrates that he does not have possession of the key. The difficulty is that, even among computer professionals, it is a frequent and almost inevitable occurrence that keys are lost, forgotten or destroyed, either inadvertently or deliberately. My right hon. Friend the Home Secretary appears to think that loss of keys is rare, but I have lost count of the number of internet services to which I have subscribed but subsequently forgotten my password. I regularly visit Amazon.com, but the last time I did so, I found that I had forgotten my password, so I had to go through the rigmarole of re-establishing myself. How am I to convince a judge, who might not even have heard of a PC, let alone the newer technologies, that I am not lying--that I cannot remember my key and that I am not deliberately concealing it? A criminal who is prepared to risk a six-month jail sentence to conceal a key will be in a better position than an innocent person who is faced with having to try to prove a negative--that he has a sieve-like memory and that he is not deliberately concealing a key. The Bill will c