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Intelligence and Security Committee: Annual Report 2007–08

I am pleased to have the opportunity to speak in this debate. I am sure that we all join together in welcoming the reforms. Noble Lords have not touched on this matter, but we are debating the report for the first time in the House of Lords and that is a great move forward. The other place had a similar debate on 7 May and it is good that we have this opportunity. I thank the noble Lord, Lord Foulkes, for opening the debate so ably, and I thank all those who have contributed and made important points today. I pay tribute to the sterling work of our security and intelligence agencies, an issue on which a number of speakers have touched. These agencies are staffed by men and women who work day and night—in fact, I was at a briefing in Vauxhall Cross at lunchtime today with someone who had been debriefing an agent for more than 18 hours solid over the weekend—to protect our country and its interests both at home and overseas, and they often put themselves at great risk. I know that we all admire them for that. The agencies are rightly recognised as world-class organisations. They have had major successes since 2001. With the help of the security and intelligence agencies, more than a dozen attempted terrorist plots in the United Kingdom alone have been disrupted, and almost 200 people have been convicted of terrorist-related offences. The diligence of our agencies is crucial in helping us to tackle some of the most difficult security challenges that we face, both overseas and across the board, in large areas of national security. By necessity, of course, an awful lot of this work is invisible but, given what crosses my desk every day—a number of the speakers in today’s debate have been in the same position in the past—I can assure noble Lords that that does not mean that the work is any less important. I am very glad to agree with those who have spoken and, like them, I admire the efforts that are made in this regard. I add my thanks to those of other speakers to the members of the Intelligence and Security Committee for their hard work over the past year, which is very impressive. I share the view of a number of speakers that the product coming out of the committee and its oversight have got better and better, which is good. My final note of thanks goes to those who undertake the necessary judicial oversight of the agencies—the Intelligence Services Commissioner, the Interception Commissioner and the president and members of the Investigatory Powers Tribunal. The challenge that they help us to uphold is striking the right balance between protecting the most important of human rights—the right to life—and protecting the other rights that we in our democracy hold so dear. I am convinced that the right balance of mechanisms is in place—legislative, ministerial and parliamentary scrutiny—and that it is provided by the committee and the honourable Members of both Houses to ensure that the agencies fulfil their lawful duties. The tragic events of 7 July 2005 are etched on the memory of the British people. The noble Baroness, Lady Manningham-Buller, told of the impact they had on her when she was in her previous post. We all express our regret and condolences to those whose family members were killed and to the survivors of the bombings, some of whom were very badly injured. I am very grateful to the ISC for conducting a very thorough and comprehensive review of the intelligence relating to that attack. I accept the committee’s assessment that decisions made by the Security Service and the police in 2004 and 2005 were understandable and reasonable. The noble Lord, Lord Foulkes, said that some people did not want to accept that. I am afraid that that is in the very nature of things. I know from my own experience when my ship was sunk that, when people look at things later in the cold light of day, it is very easy to be wise after the event. I remember one young man who had been in a compartment that was on fire with dead people around him, and one of the people on the board—I was allowed to sit in on all this—on a lovely quiet sunny summer’s day in Devonport asked, "Why did you switch such and such a valve to such and such a position?" I felt that he had no understanding at all of what actually happens at such times, with the pressures on people and so on. We must always remember those things. These are the sorts of pressures that some of these men are under. Given what they knew at the time and their resources and priorities, there is no doubt that MI5 and the police made very understandable and reasonable decisions, and I thank the committee for coming up with a very good outcome on that. However, things can be learnt from the report and the committee was quite right to point them out. The main criticism was about information flows between MI5 and the police in 2003-04, which should have been better. We always have things to learn, but we have made enormous strides in that area and we picked those up very quickly. The police counterterrorism network has now been established containing CTUs—for example, in Manchester, which I visited very recently, and Leeds, Birmingham and the Thames Valley. I went to the one in South Wales on Monday when I was doing a counterterrorist launch down there. The Security Service now has offices across the United Kingdom. I could not help noticing that most of the people who work in them during the day seem to wear trainers. However, they are working very hard and provide local intelligence direction through daily contact with the police. The noble Lord, Lord Foulkes, mentioned the importance of Prevent, as did a number of other speakers. That is absolutely correct. It was quite clear to me when I came into post—I discussed it with the Prime Minister and others beforehand—that we cannot arrest and protect our way out of this problem. That is just an impossibility. I can think of a nation that has tried to do exactly that and it does not work. We have to reduce the number of people who become radicalised and become violent extremists. That is why we have put so much effort into the Prevent agenda over the past two years. We have a very comprehensive and good Prevent agenda, to which I shall come back a little later. The noble Lord also mentioned dismay over SCOPE. We take this issue very seriously. There is a large loss of funds, and there have been cases like this in the past. When I was chief of defence intelligence I found that the big computer system that was being set up was not fit for purpose and was not working. I had to make the very difficult decision to pull the plug and say no. We have to learn from these things. The Cabinet Office has given the ISC a memorandum dealing with all aspects of that programme, although the financial details have yet to be finalised. Commercial sensitivities are involved because of the negotiations going on between the Cabinet Office and the firm involved at the moment. What is good is that SCOPE 1 is up and running and gives a good link at top-secret strap-2 level. However, we are looking at other options for interactive working and chat-room working and so on, which we will have to do in the future. It is not a good story, but it was absolutely right that we stopped the system where we did and we are looking at all the options. I cannot say much more on that because of the commercial sensitivity of some of those issues. The noble Lord and a number of other speakers mentioned intercept evidence. I do not want to go into huge detail; all I will say is that the Chilcot report was produced and Chilcot felt that nine tests had to be met. That was touched on by the noble Lord, Lord Thomas of Gresford. A Privy Council advisory group is looking at this. The Chilcot study group was a cross-party group. The Government are very open to using intercept as evidence as long as we can protect the crown jewels and the things that we need to protect. There is a feeling that this is a silver bullet, but it is not. Having spent many years—probably going back to the 1970s—listening to intercepted material, I know that you do not get clear-cut answers. Normally, you do not get the answer in court. Where we have looked at this issue in a number of cases, that has not always been achieved. Even so, the Government are very content to go down this route as regards intercept evidence and would like to do so for reasons of openness and so on. However, we have to meet the tests. There is no doubt at all that the people whom we are chasing and running down are very cute, and they learn very quickly when we give anything away. When something is given away, you can see, almost within a matter of weeks, how it permeates out through their organisations and we begin to find that we cannot use that evidence again. We need to be really careful in that area. We will have many more debates about this issue, so I do not intend to go into it any further. I understand the strength of feeling on it, but Chilcot set nine tests. We have to go through each hoop to see whether we will meet them, and we will move forward on that basis. Perhaps I may say how delighted I am to see the noble Baroness, Lady Park, back and in such good form. That is good news. I understand her point on open meetings, and we will debate and look at this issue further. There are arguments on either side, and it will be interesting to see where that debate goes. The joint operations between the SIS and the Security Service, which she mentioned, are without doubt working much better than they were when compared with the situation at the end of the 1980s, when I first did a lot of work with the agencies. That includes GCHQ. I am sure that the noble Baroness, Lady Manningham-Buller, would agree. The linkages are quite amazing, and in the areas involving working abroad—for example, in Afghanistan or Pakistan—or in this country, the work of those teams together is quite incredible, as is the amount of interchange. It is very satisfactory and gratifying. The noble Baroness, Lady Manningham-Buller, touched specifically on the evolution of the ISC. I agree entirely with her that it is very healthy that it has gone beyond the policy, admin and finance area to a much wider look at things, and that should be encouraged. We perhaps need to look at extending that remit even further. She is absolutely right to say that there is no such thing as complete security. We are under a threat level of "severe". I am afraid that, although only a tiny number of the population who want to do us serious harm is involved, what some of them are trying to do is quite horrible. I am afraid that, as an IRA person said some years ago, they only have to be lucky once and we have to be lucky all the time. That is a daunting prospect. We could easily spend our entire national wealth on counterterrorism, and, without a doubt, we still would not be absolutely sure of stopping all terrorism. We would then, of course, be doing the job of the terrorists for them. We must be extremely careful about that. On the noble Baroness’s point about recruiting agents, I believe that the British public would be appalled if they thought that we were not trying to do that. However, there is no pressure put on them in the way that the media have tried to suggest. People think that recruiting agents is exactly what we should be doing. I think that I have covered all of her points on that issue. The noble Lord, Lord Thomas of Gresford, talked about GCHQ’s recruitment problem, and he was right to raise that. An issue that affects the agencies across the board, the armed services and indeed industry is the fact that high-calibre linguists, expert analysts and IT specialists are really important assets. They are valuable to the nation and it is difficult to hang on to them. In the Royal Navy, we would train up our nuclear panel watch-keepers for the nuclear programme, but their pay goes nowhere near what they can step outside and get straightaway. That is a real problem with trained people. The average rate of drop-out at GCHQ is around 3 per cent, which is not bad, but it is something on which we have to focus. The noble Lord is right to raise the issue and it was commented on in the report. We will have to put a considerable amount of effort into it, but we cannot just go on increasing pay. Instead, we have to look at how it should be dealt with. The noble Lord also touched on the post of Professional Head of Intelligence Analysis, while the noble Baroness, Lady Neville-Jones, referred to the DIS. As noble Lords can imagine, having been Chief of Defence Intelligence and before that Director of Naval Intelligence, each for three years, I believe in the importance of analysis. The DIS, after changes were made to the Foreign Office some 18 years ago, has the biggest pool of analysts. Raw intelligence without analysis, unless you are very lucky and get a crown jewel, does not help very much; it is the analysis that is so important. There is a problem in terms of the DIS, and no doubt the pressure on defence when looking at numbers at head office has meant that the DIS has had to take a cut. It has been a much smaller cut than those made in other areas of the MoD, and the DIS has tried to make cuts among administrative staff rather than the analysts themselves. We need to look at this carefully because we must look after such a scarce resource. That is what we are trying to do. I touched on the importance of the Prevent strategy earlier. The cell within JTAC is not the whole picture. Within the Office for Security and Counter-Terrorism in the Home Office, a chunk of Prevent work is going on, and we outsource certain research projects. We have the Research, Information and Communications Unit which focuses specifically on Prevent activities. If the noble Lord, Lord Thomas of Gresford, and other noble Lords would like to have a briefing about this area, I would be happy to provide it. It is important, which is why we have taken it right down to the community level through community cohesion and community policing, and right up to the national and international level with outreaching to Pakistan. I can say that there is no doubt that our Prevent strategy is the best in the world. People come to look at what we are doing, while we take things from other nations. The Americans, who until recently were not interested in this area of endeavour, now see it as a very important effort. I am proud of where we have gone with it and I would be happy to give a briefing to noble Lords. I think that they will find it very interesting. The noble Baroness, Lady Neville-Jones, also mentioned the Professional Head of Intelligence Analysis. It is interesting to note that after taking up his role as chairman of the JIC at the beginning of 2008, Alex Allan reviewed the future purpose, structure and leadership of the PHIA post in consultation with the analytical community and decided to take up the title of Professional Head of Intelligence Analysis in recognition of the importance of the role and the desirability of Permanent Secretary-level oversight of it. He is a Permanent Secretary, while Robert Hannigan, the security adviser to the Prime Minister, is just one grade below that. We do have senior civil servants locked into that area. The noble Baroness mentioned the National Security Strategy, and of course we did not have one before last year. There were a number of gaps and perhaps it was not as refined as it should have been. We will produce a revised version in, I hope, the next month or so. Reference was made to not specifically talking about the agencies. We have to be a little careful about this. They are of course fundamental to the national security strategy in so many areas, as are so many of these other forces. On the outward face, this is the only national security strategy that does not have a classified chunk. We published it uncut, so that the British public could for the first time get a flavour of it, and we also published a national risk register. That was never done before: in the past there was the NRA, which was confidential and hidden away. Now we have a national risk register that goes out right down to local resilience forums, where local people can see what are the risks to their local area and population and what they can do about it. We have done a lot in that area and I am rather proud of what we have achieved. On how it is monitored in Parliament, the Prime Minister has committed to establishing a new joint parliamentary committee, which will consider reports and updates to them. The people in it will be established shortly, as I understand it, and they will consider the next iteration of the national security strategy when it is produced this summer. On the single intelligence account, as the noble Baroness, Lady Neville-Jones, said, only the SIA is made public, the specific agency budgets are not. There is a danger that if we do that, we may indicate the level and scale of the operational abilities of each agency. We must be wary of that. As the ISC sets out in its report, the CSR 2007 settlement will take funding of the agencies to more than £2.3 billion, which I think everyone accepts is good news, because we have to get to grips with this threat, which is very real. As I said, sadly, they only have to be lucky once. The allegations of torture are very serious. Our position on that is absolutely clear: we condemn it wholeheartedly. It is a very difficult issue. The Prime Minister has come up with four things that he said he will do. However, if my opposite number from a country with whom we deal with in trade, politically and every way, but we do not necessarily like what they do in their country—whether capital punishment or whatever—phoned me up and said, "Right, I have these two names and they are going to blow up Wembley tomorrow", I do not think that I would say to him, "Hang on a minute, I just want to make sure that the way you got that information is absolutely clear-cut. I would like to send someone to find out. Can you promise me that that was not done?". I just do not think that I would do that. That is where these things become quite difficult. The Prime Minister has said quite clearly that we will publish guidance to intelligence officers and service personnel. It will be consolidated and reviewed by the ISC which, as I understand it, is working on that at the moment. As soon as that has been done—it is complex because there is guidance for the MoD as well, so there are different levels of guidance—it will be put in the public domain. We will invite the Intelligence Service Commissioner to monitor compliance with the guidance and report to the Prime Minister annually. We have asked the ISC to consider any new developments and relevant information since the report on detention in 2005 and rendition in 2007 and to report on that. We have made it clear that wherever allegations of any wrongdoing are made, they are taken extremely seriously. If further cases of criminal wrongdoing come to light, we will refer them to the Attorney-General, because it is only right and proper that we should do that. I hope that I have answered most of the points raised. If not, I am very happy if people come to talk to me or get back to me in writing. Throughout our work to tackle this wide range of threats, the Government and the agencies have to take difficult judgment about priorities and proportionality. It is not easy, but I am confident that, generally, the right balance is being struck. Protecting the safety of people in Britain is a primary duty and a binding obligation on government. We must recognise that the threat we face is very different to what has gone before in terms of its scale and its aims. We know that there is the pervasive danger of radicalisation of our own people. We must stand firm on our principles—the pre-eminence of human rights and shared values—but we must also up the level of our response. That is why we have increased funding dramatically to about £2.3 billion by 2011—£1 billion more than in the past. I believe—I suppose I would as Minister for counterterrorism—that this is the highest priority for the agencies. It is important to note that, as was raised by the ISC, because of additional commitments, actual spending in other areas, although it is a reduced percentage, has increased. The committee is absolutely right in raising its concern—we must keep a very close eye on that, but we must go for the wolf closest to the sledge. As I said, thanks to the dedication of the men and women in the security and intelligence agencies—we have two here who have worked there in the past—we have, although I am always very wary of saying this, had considerable success in stopping terrorists in their tracks and bringing those responsible to justice. However, the threat has not gone away and that is why we need to keep ahead. It is why we have updated CONTEST. It draws on our considerable experience, as I think people around the world realise. In recent years, the number of police dedicated to this area has grown to about 3,000 and the Security Service has doubled in size. These things are crucial and they need to be done to counter the threat. More than that, we need the steadfast support, help and vigilance of all our communities without frightening them about the threat. I have great belief in the British public and I think that that can happen. It is because they all pull together that they are able to keep us safe and they are crucial to our success.