UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 144-i

House of COMMONS

MINUTES OF EVIDENCE

TAKEN BEFORE

HOME AFFAIRS COMMITTEE

THE SECURITY INDUSTRY AUTHORITY

Tuesday 4 December 2007

SIR DAVID NORMINGTON KCB

MR ANDY DRANE

Evidence heard in Public Questions 1 - 64

USE OF THE TRANSCRIPT

Oral Evidence

Taken before the Home Affairs Committee

on Tuesday 4 December 2007

Members present

Keith Vaz, in the Chair

Ms Karen Buck

David T.C. Davies

Mrs Janet Dean

Patrick Mercer

Margaret Moran

Gwyn Prosser

Bob Russell

Martin Salter

Mr Gary Streeter

Mr David Winnick

________________

Witness: Sir David Normington KCB, Permanent Secretary, Home Office, gave evidence.

Q1 Chairman: Sir David, I now want to turn to some questions on the SIA. When did you become aware that the SIA was granting some of their licences to people who were in fact working as illegal immigrants?

Sir David Normington: I think I became aware of this as a significant problem around the end of June the beginning of July. I know before then, and you have the chronology from us, that there had been a Border and Immigration Agency operation which had shown that there was a company where there seemed to be quite a significant number of people working illegally. I was aware of that case in April. I was not aware of how big the problem was until about the end of June.

Q2 Chairman: We were surprised last week to hear from the Immigration Minister that he discovered this in April. When the Home Secretary spoke to the House in November this year there was no indication that ministers and officials knew as early as April. You were aware because presumably documents were copied to your private office that this was discovered?

Sir David Normington: I knew about this one operation.

Q3 Chairman: Did that not alert you to the fact there was a bigger problem?

Sir David Normington: Because it was in the same advice, I knew that as a result of that there was a concern and that led to the more intensive checking of people in the succeeding months.

Q4 Chairman: Why did the Home Office not put more pressure on the SIA? According to your chronology it was not until seven months later that a complete check was instituted in respect of everyone who applied for the licences. It seemed to take from April 2007, according to the chronology that the Minister provided us with for today's hearing which I asked for last week, all the way down to October 1 when they decided to have a complete check. Why did it take seven months?

Sir David Normington: The complete check on new applicants started I believe at the end of June. There was then the question as to whether we should ------

Q5 Chairman: No, I am sorry that is not right. If you have read your chronology, the complete check was not started in June. Have you seen this chronology?

Sir David Normington: I have, yes, of course. It is in front of me.

Q6 Chairman: It says BIA and SIA agree that the BIA (the Border and Immigration Agency) would carry out a more intensive check of 10% as a pilot. The complete check did not start until much later. It was seven months before the Home Office initiated this.

Sir David Normington: No, the 100% check started on 2 July, if you look at the three points there in the chronology. Just to be completely clear about this, in April we knew about this operation which highlighted a problem. The two agencies then did a very intensive check of 10% and, as a result of that, they said, "This looks more worrying than we had previously thought". Therefore the 100% check came in on 2 July.

Q7 Chairman: Whose idea was it not to tell Parliament about this? Was it yours or the Home Secretary's? Parliament was sitting between April and July and Parliament only discovered this in November.

Sir David Normington: I do not think we thought it was necessary, I am afraid, to inform Parliament straight away because we did not have all the facts. Basically the SIA itself decided that it needed to do a 100% check which it was perfectly entitled to do on new applicants. We then said to them in discussions during July, "What about all those people who have already got licences? Shouldn't we be doing a check on that?" We did not know the scale of that problem and we did not have a grip on that problem at that stage, and the Home Secretary herself decided, as you know, that we should actually try and understand what the scale of that was before we told Parliament.

Q8 Chairman: But you no doubt have seen emails from your officials which stated the reason why the Home Secretary did not bring this matter before Parliament was for "presentational reasons", that there needed to be a better case, first of all, before it could be presented to Parliament. Does that cause you concern as the Permanent Secretary that junior officials are sending out emails about presentation issues in order to keep matters away from Parliament?

Sir David Normington: I am not very proud of those emails actually.

Q9 Chairman: What action have you taken?

Sir David Normington: I am trying to make sure that is not repeated. If I may just complete the point: it is not what advice is given; it is what decision is taken. The Home Secretary was quite clear, in fact she was quite irritated if I remember, because I was just about to go on holiday, and her irritation was that she did not know what the scale of the problem was and she did not know how quickly we could get on top of it. It was not until we knew the answers to those questions - and they were prompted by the Home Secretary saying very clearly in this minute, "I want to know what the scale of this problem is and I want us to get on top of it" - that we were in a position to say what we then said in her statement to Parliament later.

Q10 Chairman: Are you happy with regard to the communication between the BIA and SIA?

Sir David Normington: Yes, I am. Interestingly, back in the summer of 2006, after the appearance here when the Home Office was criticised by the former Home Secretary, one of the things we did with all our agencies is we looked to see the extent to which the working relations between them were effective. We actually put the BIA and the SIA in the same room and we went through whether their operational links were working, and also whether the level of checking was proportionate. We believe it was; but that was action we took nearly 18 months ago. That meant there was a very good working relationship in place, so that when the scale of the problem became more apparent they were then working together very effectively.

Q11 Chairman: But the problem was not discovered for some time afterwards?

Sir David Normington: There was checking, but the checking that was done earlier did not show up the scale of the issue.

Q12 David Davies: The National Security Inspectorate told me in April 2005 about this problem. Did they not contact the Home Office and tell them as well?

Sir David Normington: I do not know that. I am not aware that they did. I am not aware of that being the case. I do not know whether they contacted the Security Industry Authority. All I can tell you is that we did not have the evidence that suggested that was a major problem in this industry.

Q13 David Davies: What was the specific change that was made in the way you checked the right to work which suddenly increased the percentage? Mr Byrne said, "From April 2005 to April 2007 those non-EU citizens who declared themselves as such were asked to provide evidence of their right to work. What changed in June was that we checked our databases on that sample, so rather than put the burden of proof on the individual we shouldered that burden of investigation". Do you know what that means, because I did not understand it at the time and I still do not understand it now?

Sir David Normington: What it means is that the names were run against the Border and Immigration Agency's databases to see whether there was a match; whereas previously I believe that the checks were done by asking for documentation from the individual. I think then there was a check both of the documentation and a check against the Border and Immigration Agency's database.

Q14 David Davies: Previously you just asked the individual, "Have you got a right to work?" and if he said, "Yes", then that was that?

Sir David Normington: There would have to be documentation. Just to be clear, this is the Security Industry Authority's process and it is the employer's responsibility to ensure that people have the right to work. It is really important to say this: if, every time there is a problem, we take the responsibility into the Home Office we will be checking every person who is employed in the country, and of course that would absurd. There has to be some proportion here between what employers are expected to do, what our regulatory authorities are expected to do and what the Home Office does.

Q15 Patrick Mercer: How are Ministers being kept up-to-date with progress on the SIA and the BIA work to carry out immigration status checks?

Sir David Normington: The Home Secretary asked the Minister Vernon Coaker to chair what she called a taskforce which is meeting regularly to check on that progress. They are making regular reports to the Home Secretary and she is occasionally, on the basis of those reports, calling people together to see what progress is being made.

Q16 Mrs Dean: Sir David, what work is the Home Office doing to address this problem in the longer term? Is the remit of the SIA under review?

Sir David Normington: The SIA already has the ability to do these checks because it was already doing a random set of immigration checks back to 2005 and actually in its published documentation said it was doing that. I am not sure at this stage that there is a need for a review of their powers. When we are through this immediate issue of looking at those who have already been given licences I think there will be a need to sit down and say, "So what have we learnt about this, and do we think there are new powers that the Security Industry Authority needs. I do not think that is our priority at the moment.

Q17 Mrs Dean: Should the SIA carry on doing that 100% check?

Sir David Normington: At the moment, until we can be satisfied about this, I think they have to carry on doing 100% checks. As I said earlier, there are other people involved in this. I think we need to sit down with the security industry and make sure that they accept their responsibilities as well. I think they do, but I think they will want to ensure that they play their part in making sure that checks are done properly. It is only when somebody comes into your employment that you can do the check on that person. Nothing that we can do can say, "That person is suitable for you". I think there is a shared obligation here.

Q18 Martin Salter: According to the chronology, and I remember the statement from the Home Secretary, Sir David, on 13 August the Security Industry Authority sent out 2,000 letters to all the private security firms reminding them of their obligations not to use illegal labour. Was this letter signed off by the Home Secretary?

Sir David Normington: I think so. It was certainly cleared by Ministers. Yes, I think so. I am pretty sure that it was.

Q19 Martin Salter: It does make something of a nonsense, in that case, to suggest that the Home Office were involved in some kind of elaborate cover-up if Ministers were signing off a letter to 2,000 people?

Sir David Normington: I, of course, do not believe there was a cover-up.

Martin Salter: Exactly.

Q20 Chairman: Have you seen the form that people fill in when they apply for a licence; and does the form take the question: are you satisfied with the immigration status?

Sir David Normington: I have looked at a booklet called Get Licensed which is the criteria the SIA use. I have not looked at the specific form but I have looked at that, and that does have a very clear statement about the possibility of right to work checks, and also reminds employers of their obligations.

Chairman: Sir David, thank you very much for coming to this session and answering our questions so forcefully. Thank you very much.

Witness: Mr Andy Drane, Deputy Chief Executive Officer, Security Industry Authority, gave evidence.

Q21 Chairman: We now have the Deputy Chief Executive Officer of the Security Industry Authority, Andy Drane who will be giving evidence to this Committee. Mr Drane, good morning. Thank you very much for coming to give evidence to this Committee at such short notice. You were obviously present during our session with the Permanent Secretary. You presumably have seen the form which is given to the people who apply for a licence, have you not?

Mr Drane: Yes.

Q22 Chairman: Does that form contain the question: "Have you checked the immigration status of the person applying for a licence?"

Mr Drane: The form is completed by the applicant themselves and not by their employer. The form does not specifically ask, for instance: "Do you have the right to work in the United Kingdom?"

Q23 Chairman: So it does not ask them?

Mr Drane: But it does ask them to declare their nationality. Also when they sign the form they sign to say that they have read the Get Licensed booklet which sets out all the criteria which they know they have to satisfy.

Q24 Chairman: Indeed, but you understand my point. Are you still sending out these forms that do not ask people: "Do you have the right to work in the United Kingdom?"

Mr Drane: The forms do not ask that question.

Q25 Chairman: Are you still sending out these forms which do not ask the question?

Mr Drane: Yes.

Q26 Chairman: Why are you still sending out a form which does not ask whether people have the right to work in the United Kingdom?

Mr Drane: Because we are satisfied that the form elicits the information we need to process the application.

Q27 Chairman: On the basis of nationality?

Mr Drane: On the basis of nationality, we have that piece of information; but also the form requires people to sign to indicate that they have read all of the criteria that apply for the licence application.

Q28 Chairman: Bearing in mind the fact that the SIA has been responsible for giving licences to thousands of people who are illegally working in this country and that you are now undertaking checks of people you have given licences to before and the Home Secretary has had to come before Parliament to explain the mistakes that have occurred in the SIA, do you not think you should look at that form and ask people whether they have the right to work? Is that not a problem?

Mr Drane: It is the process that determines whether or not someone gets the licence they should or should not have. The form is part of that process, and the form asks the information that we need to carry out an effective process.

Q29 Chairman: I am, clearly, not going to win on this issue but I would have thought the easiest thing to do was to ask them whether they had the right to work. Clearly, I would not get a job at the SIA, would I? You have seen the chronology, presumably, that has been prepared by Ministers.

Mr Drane: Yes, I have, Chairman.

Q30 Chairman: When did you first become aware, as Deputy Chief Executive? By the way, what has happened to your Chief Executive?

Mr Drane: The reason I have been asked to come today is because I was acting as Chief Executive between January and August of this year and so was responsible for all the decisions made during the relevant period and was the accounting officer during that time.

Q31 Chairman: When did you become aware of this problem?

Mr Drane: I first became aware that we had an emerging problem towards the beginning of this year, in about April and May. I became aware, for instance, of the BIA operation, but also other intelligence that was coming in to our intelligence cell starting to indicate - give anecdotal evidence - that there was an issue with people with SIA licences.

Q32 Chairman: Mr Burn was very firm about this last week. He claimed to this Committee that he discovered, that BIA discovered, through a BIA operation, that there were licences being given to illegal immigrants. Are you saying that you discovered this?

Mr Drane: No. It is a combination. We were informed of the BIA operation. We also, at that time, coincidentally, started receiving similar information coming in from our various sources. So it is a combination of that information that resulted in us working with the BIA to do the different sorts of checks that I heard referred to earlier on.

Q33 Chairman: Initially, you told Ministers that it would take you, I think, 18 months to check through all the licences that had been issued. However, the Home Secretary insisted that this should be done by the end of this year. Are you on target for that?

Mr Drane: Yes.

Q34 Chairman: Have you asked for any more resources?

Mr Drane: No, we have been able to do it within existing resources and within existing budgets.

Q35 Chairman: Have there been any resignations or retirements at the SIA since you discovered the fact that you were giving out licences to illegal immigrants, some of whom were protecting the car of the Prime Minister?

Mr Drane: No.

Q36 Chairman: None.

Mr Drane: None that I am aware of related to this issue.

Q37 David Davies: Mr Drane, I cannot see the section that you referred to on the form, but just clarify something for us: if somebody fills this form in and they say that they are from an non-EU country and they sign to say that they have read the booklet, what further checks do you then carry out to ensure that they are actually entitled to work?

Mr Drane: As a result of the new process we introduced on 2 July, we forward some of the information to the BIA for them to check their databases to tell us whether the person has a right to work in the UK, and then we act from then.

Q38 David Davies: How do you ensure that the identity of the person who appears to be applying for the form is accurate? How do you know that they are not simply putting down a false name and address or a false name?

Mr Drane: They are required to submit, with their application, a range of identity documents and, also, there is a counter-signatory.

Q39 David Davies: Are any of the documents photo evidence, or are they things like utility bills and the like?

Mr Drane: The current range of documents that is required is a passport or photo evidence. Primarily, what we look for is a passport. Prior to 1 October our identity documents were not so robust.

Q40 David Davies: When did the National Security Inspectorate alert you to this problem?

Mr Drane: I do not recall them doing so but that does not mean they did not.

David Davies: Okay. That is all, thank you.

Q41 Gwyn Prosser: We have deduced from answers to questions of the Home Office that up to 10,000 non-EU nationals who were licensed by you to work in the security industry could be working illegally. What would be your estimate of that number now?

Mr Drane: We are currently working through the data and I know the Home Secretary has promised to give a statement to the House later this month, and I think she will be in a position to give a more accurate assessment of the situation based on the process that we are currently doing.

Q42 Gwyn Prosser: You have discussed the chronology we received from the Home Office about the way declarations and information became available, and I am tempted to ask you if you would provide us with your chronology. I am sure it would be very close to the chronology from the Home Office, but if you would provide us with a written chronology would you expect it to include other revelations about what people in your authority knew and when?

Mr Drane: I have been provided with a copy of the chronology provided to the Chairman, and I agree with that chronology, as it is written - with the bits that are within my knowledge.

Q43 Gwyn Prosser: I thought it might! Finally, from me, we have asked the Home Secretary and we have asked the First Secretary whether there has been a cover-up about these matters. From your position, because you were in post during these difficult times, can you put your hand on your heart and say there was no cover-up within the SIA?

Mr Drane: Yes, I can, and I think the point has already been made that I wrote widely to the industry in August (my letter of 13 August) setting out the issue and warning people of the need to be more vigilant in this area. We also did some work with a number of individual companies, so I can honestly say there was no cover-up on the part of the SIA.

Q44 Chairman: In answer to Mr Prosser's question you said the Home Secretary would give us information in December. You are the Deputy Chief Executive of this organisation; do you know, as of now, how many licences were given to illegal immigrants?

Mr Drane: No, because we are still going through the process of data-matching the 39,000 non-EEA licence-holders that existed prior to 2 July. We are still currently data-matching that with BIA data traces to produce that information.

Q45 Chairman: I understand you do not have a final figure - I understand that - but do you have any figures at all to give us today?

Mr Drane: No, I do not, but certainly a number have been identified and revocation has taken place.

Q46 Chairman: How much, as a number?

Mr Drane: What I can tell you is that, so far, we have revoked just under 150 licences from people that we are not satisfied have a right to work in the UK, but, as I say, the process is ongoing.

Q47 Chairman: You have only revoked 150 licences?

Mr Drane: So far, but that is because the licence revocation process takes a minimum of 42 days because of rights of appeal to the courts, and so on.

Q48 Bob Russell: Mr Drane, you have, possibly, partly answered this question previously to colleagues. How does the SIA co-ordinate and consult with the Border and Immigration Agency? Is there a structured formula, or is it very much ad hoc?

Mr Drane: No, I have a permanent point of contact at the BIA and all our operations are routed through that. We have specific arrangements with the Airports and Enquiry Unit in terms of the exchange of information and I have access to a relatively senior manager in the BIA to address operational issues.

Q49 Bob Russell: So there are set procedures, it is structured and it is not just as and when?

Mr Drane: Yes, and we have arrangements for the sharing of information. Indeed, that is something we now increasingly do - to share information packages so that our respective operations can be productive.

Q50 Bob Russell: Is that liaison with the BIA in relation to enforcement action taken against those working illegally in this sector? Is that part of the "working together in partnership, joined up" thinking?

Mr Drane: Yes. For instance, only yesterday we sent across an analysis package to the BIA which will enable them to target, through their powers, which obviously we do not have.

Bob Russell: Thank you.

Q51 Margaret Moran: Just a question in terms of the shape of the industry itself. How much of it is sub-contracted out, do you know? How many are temporary agency staff? Would you have any of this sort of information?

Mr Drane: The only information that I have, in a sense, is the number of people that we license. There are, currently, approximately, a quarter of a million licences for working in the security industry. However, not all the security industry is licensed; for instance, in-house security, directly employed by an organisation, in most cases, is not licensable. Primarily, our licensing regime is for contracted security.

Q52 Margaret Moran: You would not be aware, for example, although you had licensed a company to do this work, that they might subbing-out to people that were unlicensed. Is that possible?

Mr Drane: To make it clear: we do not license companies; we license individuals. We do have a voluntary approved contractor scheme, which is voluntary. Certainly, where we give those approvals we do take account of their sub-contractors and we require their sub-contractors to adhere to the same standards.

Q53 Margaret Moran: However, you cannot guarantee that they will.

Mr Drane: Well, it is part of the assessment, and if they did not follow up on this or adequately satisfy our assessors we could ultimately revoke their approved status. It is important to say that the approved contractor scheme is voluntary, although on our current estimates about 49/50 per cent by volume of the licensable industry is in the Approved Contractor scheme.

Q54 Margaret Moran: Obviously, you will have heard the evidence that we heard from the Permanent Secretary earlier. Is it true to say that there is a confusion between the role of the SIA and employers' legal obligations? Do you think that that exists? If so, what lessons need be learned from that?

Mr Drane: I cannot speak for employers. What I can say is that there is sufficient guidance which makes it clear that this is the employer's responsibility. We have also always made it clear. I guess it is possible that some employers do not understand their responsibility, but part of the reason for reinforcing that in my communication of August was intended to remove that ambiguity once and for all.

Q55 Margaret Moran: Would you welcome a review of the SIA's remit in all of this?

Mr Drane: I think we would always welcome any kind of review that was constructive, but I think in this particular case the actual framework that we had in place worked, in the sense that by building in the ability to consider a right to work in our criteria, when the new systems became available, as have been indicated this year, and we identified a problem, we were able to react in an operational way immediately.

Q56 Mrs Dean: Do you know how many of those with licences are actually self-employed?

Mr Drane: No. It is an individual licence application. Although we are aware that some applications are submitted through companies we would not have that information.

Q57 Mrs Dean: I am just interested because, obviously, those who are self-employed would probably be more concerned about the employee/employer who would be an individual business employing someone self-employed and, perhaps, presuming that because he had got the licence he had a right to work. Rather than an agency employing somebody, we may be talking about an individual club, for instance, employing somebody with a licence.

Mr Drane: It is a risk that with a licence having been granted by the SIA, which is an arm's length government agency, that assumption could be made. However, that is why we are increasingly making it clear that that should not be taken for granted; that it is not the case that an SIA licence is a guarantee of a right to work. Where there is doubt, that should be checked separately. Again, that is part of the additional communication that I have already started and that will be continuing, to make sure that people understand that.

Q58 David Davies: Is this form available in any different languages, Mr Drane?

Mr Drane: No.

Q59 David Davies: Or the booklet?

Mr Drane: No.

Q60 David Davies: So if somebody has come from another country outside the EU they are expected to be able to speak fluent English in order to understand and to have read the guidance notes then?

Mr Drane: In order to gain the qualification that they require to be able to apply for a licence they have to be able to communicate sufficiently in English. That is one of the requirements for the qualification, so that is one of the reasons why we have not considered that necessary.

Q61 Chairman: The Permanent Secretary was pretty clear, was he not, that the responsibility for this lies with you and not with the Home Office, because Ministers cannot be expected to check every single application form. Do you take responsibility for what has gone wrong in this matter?

Mr Drane: The published criteria for licence applications makes quite clear, and has always made clear, that we may check the right to work, and that it is the employer's responsibility. So what I do take responsibility for is that when we identified a problem we put it right quickly.

Q62 Chairman: So you think everything has been perfectly fine and this is a fuss about nothing, and the pressure the Home Secretary has been put under was a demonstration that the framework works?

Mr Drane: We took a view, as is reported in the chronology, last year, in consultation with the Home Office and the BIA, that the approach we have taken at that time is proportionate in consideration of the information we had. When the information changed we used the criteria to change our operational processes immediately.

Q63 Chairman: Even though it was reported that thousands of illegal immigrants were working with licences issued by your organisation, you have only revoked 150 licences.

Mr Drane: So far.

Q64 Chairman: So far. Thank you very much for giving evidence to us. We would be most grateful if you could send us a copy of the booklet and a copy of the application form.

Mr Drane: Certainly.

Chairman: Thank you.