Victims of Overseas Terrorism Bill [HL]

My Lords, I join all noble Lords who have thanked my noble friend Lord Brennan for introducing such an important Bill today. It has led to productive debate upon an issue about which we are all concerned. He was right when he indicated that the support for the principle behind his Bill would extend across all parts of this House, and indeed in all parts of the other place too. If one had doubted that for one moment, the noble Lord, Lord Marsh, testified to that effect with an unscripted and unheralded speech in which he indicated that these issues are of great concern to us all. My noble friend made his case with his usual eloquence and skill, and those whose cause he is seeking to advance should be suitably grateful to him for his concern about this area. They could not have a better advocate in this complex and important matter. I also thank the families of the victims and the survivors of previous overseas terrorist incidents, who have done a great deal to bring this issue to public attention and to ensure that the Government address it. I shall respond to the Bill and indicate where it will need improvements, but also indicate just what the Government’s thinking is and how we hope to be productive in this area. In recent years UK citizens have been affected by terrorism overseas, and we have to respond to that. It raises new issues for us. After the 7 July bombings, it became obvious that to enable a seamless and co-ordinated response from Government to the short and longer-term needs of those affected, we would have to address this issue in much clearer terms than we had done in the past. That is why we established a new Humanitarian Assistance Unit within the Department for Culture, Media and Sport to address these needs, and to ensure that the work is grounded in the direct experience of those who have suffered in previous tragedies. A great deal of that work is inevitably with other government departments, particularly the Foreign and Commonwealth Office, ensuring that the Government continue to offer assistance to victims of overseas disasters once they return to the UK, and improvements are continually being made to the provision of clear information and practical support to all those who are involved. In addition, the charitable fund creates a base for some financial assistance to victims of overseas terrorist attacks. We recognise that there is a very clear disparity between the level of financial support available to overseas victims compared with those who suffer from terrorist attacks within this country. We announced last year that we would contribute £1 million to the charitable fund for overseas victims, an issue that the noble Baroness, Lady Noakes, raised. The fund will be run by the Red Cross, and it will be ready to launch formally very soon. In the mean time, the Red Cross has already made payments to all those bereaved or seriously injured by overseas terrorism since the fund was announced in March this year. So far 21 payments have been made from the fund: one bereavement payment and20 payments relating to injuries from attacks in Egypt, Turkey, Jordan and Thailand. Those payments were not intended to meet the longer-term needs of those involved but the immediate financial needs that we recognise arise, such as the immediate need to meet mortgage or rent payments and telephone calls and travel to the affected areas. We recognise that the charitable fund is not a compensation scheme; it will never purport to be that, and it does not meet the issue of the disparity between what is available in this country to victims of terrorist attack and what is available to those overseas, which is the burden of the Bill. I recognise the importance of our response to that. We have therefore been looking at the financial options available for victims of overseas terrorism. We understand the argument put forward for a new compensation scheme, but there are important issues to consider. First, should we look for compensation for UK citizens from the country where the attack occurred? Many countries offer their compensation schemes and my noble friend Lord Brennan indicated the extent of that in European Union countries. The problem is that they are only some of the countries which are visited by British tourists and that recent attacks have been outside Europe. The principle at stake is whether the Government should fill the gaps or whether we should look to other Governments to do so. I respect the point made by the noble Lord, Lord Addington, that some countries and Governments may be ill placed to make such provision. However, others are directly comparable with the states of the European Union and it would be reasonable for them to adopt the same strategies. Secondly, should we treat victims of terrorism differently from victims of other violent crime? I am afraid that there are victims of horrific, life-changing crime committed overseas and the significance of its impact on them and their families is as bad as terrorist incidents. The Criminal Injuries Compensation Authority does not treat victims of terrorism differently from victims of other violent crime committed within the UK, nor does the separate Northern Ireland scheme. They are treated equally. Therefore, to do so overseas would mean taking a different approach and we are not confident that that would be the right decision. Neither of those issues would prevent us establishing a compensation scheme if we decided to do so, but it is clear that we need to examine them in close detail before reaching a final conclusion. We are committed to solving these problems and we do not pretend that they are anything other than difficult to tackle. We must define who would be eligible for compensation; we must define ““British””, ““injury”” and ““terrorism””; and we must define how a scheme would work alongside the existing domestic Criminal Injuries Compensation Scheme and the reciprocal schemes in Europe. We are therefore not in a position to be as categorical as the Bill requires us to be. Although I am offering my noble friend the Government’s commitment to tackling this issue, we are not in a position to say that the Bill provides the solution that we need. It certainly goes some way towards it and it advances the cause, as shown by the contributions to today’s debate. Furthermore, there is the issue of travel insurance, commented on by the noble Lord, Lord Sheikh, and dealt with in considerable detail by the noble Baroness, Lady Noakes. It is essential that when people choose travel insurance they understand exactly what they are covered for. Travel insuranceis designed to provide immediate assistance to individuals when travelling abroad. It is not designed to compensate them for loss or suffering, although some policies pay out for some personal injuries. As the noble Lord, Lord Sheikh, indicated, there is a range of policies on the market at different prices offering consumers different levels of cover. We do not think that it is the Government’s role to compel insurers to offer cover. The noble Lord, Lord Sheikh, deployed arguments against compulsion which raised philosophical and political decisions about the nature of compulsion on our society. Decisions on price and coverage are ultimately commercial ones for the insurer. However, cover is available for terrorist attacks and it is important that our people are aware of it and take advantage of that. We do not believe that there is a market failure which warrants government intervention to compel insurers to provide cover or to set up the Government as an insurer of last resort. That is not the position that confronts us. However, we believe it is necessary that my department and the Treasury continue to work closely with the insurance industry to ensure that terrorism cover is readily available and that where exclusions exist consumers are all too well aware of them.A recent Treasury Select Committee report recommended that the Government and the FSA should work together to develop insurance policies that are clear, in plain English and effectively promoted to ensure that holidaymakers know exactly what is included. We are about to respond to its recommendations. Clause 5 of the Bill requires that sums paid by the compensation scheme following injury or loss resulting from an act of terrorism overseas take into account an insurance payment made to the injured person in respect of that injury or loss. However, as I have noted, travel insurance is designed to provide immediate assistance, not to provide compensation for long-term suffering and loss. Such a clause might well act as a disincentive to individuals to take out terrorism insurance cover and there would be the danger that insurance cover, if stretched too far, might be unattractive because of the inevitable rise in premiums. It is important that consumers purchasing travel insurance are able to make informed choices about what they are, or are not, covered for. Insurance covering individuals for terrorism in certain cases is available on the market and we regard the task of government to raise people’s awareness of what they are purchasing in travel policies. There are aspects of the Bill which, my noble friend Lord Brennan will recognise from today’s contributions, raise difficulties. A brief reference was made to the retrospective aspect of the provision, which is an important issue. Government schemes do not operate retrospectively because we are concerned that that can cause unfairness as regards existing schemes. My noble friend will recognise that that is a significant argument that he will need to confront when piloting the Bill further in this House and during its passage in another place. We recognise that the Bill reflects the considerable work undertaken by a large number of people in tackling this issue. Where we are able to give support, we intend to do so and we are giving our support to the Red Cross scheme. However, there is another aspect of the Bill which raises interesting issues. My noble friend Lord Brennan mentioned consular assistance being placed on a statutory basis and that has significant implications for government. The noble Baroness, Lady D’Souza, indicated where she wants to see an extension of such activity and that certainly fits within the desired aims. However, it will be recognised that putting consular assistance on a statutory basis is a profound legal proposition. It may be a modest aspect of the Bill, but it raises substantial issues for the Government. Once it was in statute, it would mean that all the consular service’s actions in respect of incidents abroad would potentially become subject to litigation. We are all too well aware that consulates do their best and work constructively under enormous difficulties and in a vast range of circumstances. The House will recognise how significant it would be if such actions were potentially subject to litigation in this country about their effectiveness. I recognise the enormous amount of work that has gone into the Bill, which addresses an issue that needs urgent action. I assure the House that it is part of the process to which the Government are responding. We intend to respond in the very near future about how we tackle these issues because there is a clear obligation on us. However, as my noble friend will recognise, these are not straightforward or easy issues. Even within the framework of the Bill, there are issues that raise fundamental difficulties. The Government regard the Bill as a contribution to the debate and a pressure upon us to effect solutions, but we are not convinced that it provides the solution that the whole nation is looking forward to the Government providing.