Russia - Statement

Part of the debate – in the House of Lords am 5:28 pm ar 14 Mai 2024.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Photo of Lord Sharpe of Epsom Lord Sharpe of Epsom The Parliamentary Under-Secretary of State for the Home Department 5:28, 14 Mai 2024

I thank both noble Lords for their remarks. I will briefly outline a few highlights, as it were, from the Statement given by the Home Secretary last week, because it has been a few days and we need to tease out and probe a few important points. My right honourable friend the Home Secretary pointed out in the other place that the Prime Minister said in Poland last month that we are at a “turning point” for European security. With our allies, we will stand firm in the face of the Russian threat to the UK and our way of life—it is worth restating that for the record.

On the actions we have taken, as is well understood, we have expelled the Russian defence attaché, who was an undeclared military intelligence officer. We will remove diplomatic premises status from several Russian properties in the UK, including Seacox Heath, which is a Russian-owned property in Sussex, and the trade and defence section in Highgate. We believe they have been used for intelligence purposes. We are imposing new restrictions on Russian diplomatic visas, including capping the length of time Russian diplomats can spend in the UK.

As reported on Friday 26 April, five individuals have been charged in connection with an investigation into alleged offences under the National Security Act, which both noble Lords referred to. They rather pre-empted what I was going to say, because I obviously want to thank all noble Lords who were involved in the successful passage of what is proving to be critical legislation. It is a good example of working together, and it gives me an opportunity to thank the security services. This rather proves the point that there is co-ordinating action on behalf of the security services, the police, other government agencies and of course the Home Office, in dealing with the threats we all face. I am grateful to all the people who work so hard on our behalf in those various organisations.

I will go into the sanctions in a moment, but first I will repeat the headlines that my right honourable friend the Home Secretary mentioned in his speech. We have sanctioned over 1,700 individuals, over 90% of the Russian banking sector and over 130 oligarchs and family members, with a combined net worth of around £147 billion at the time of the invasion. As of October— I am not sure I can improve on an October figure at this point—over £22 billion of Russian assets were reported frozen as a result of UK sanctions. Those assets can no longer be taken back to Russia to fund the Putin war machine. Obviously, we consider Russia’s campaign to undermine our support unacceptable and destined to fail.

On the individuals who have been charged in connection with the investigation, and with others related to other countries that have subsequently occurred, the Crown Prosecution Service, in relation to the 26 April individuals, has confirmed that the charges relate to alleged hostile activity in the UK in order to benefit a foreign state—namely, Russia. Beyond that, I obviously cannot say very much, particularly as regards ongoing investigations.

Both noble Lords asked about illicit finance. We have swiftly implemented the strongest set of economic sanctions ever imposed against a G20 country. We have frozen over £22 billion of Russian assets under the sanctions regime, as I said, and the UK alone has sanctioned 2,000 individuals and entities under the Russian sanctions regime, over 1,700 of which have been sanctioned since Putin’s invasion. We have set up the combating kleptocracy cell in the National Crime Agency to target corrupt elites and their assets in the UK, ensuring that there is nowhere for this dirty Russian money to hide. The combating kleptocracy cell—CKC—can account for over 150 disruptions since the invasion of Ukraine, all of which demonstrably removed or reduced a criminal threat facing the UK.

I will digress briefly. The noble Lord, Lord Coaker, asked about golden visas. That scheme was closed in February 2022, following the recommendation of the Intelligence and Security Committee to review our approach to it. I have no further information about publication or anything else yet.

Returning to sanctions and what we are doing to enforce them in the UK, we are obviously committed to ensuring that they are robustly enforced and that potential breaches are investigated. Illustrating the co-ordinated approach, departments from across HMG—including the FCDO, the Treasury, OFSI, HMRC, the Home Office, DfT and the National Crime Agency—work together and with UK companies to ensure that sanctions are enforced. In August 2023, for example, HMRC fined a UK company £1 million in relation to the unlicensed trade of goods in breach of Russia sanctions. OFSI published an enforcement notice against Wise Payments Ltd, an FCA-regulated company, for breaching Russia sanctions by making funds available to a company owned or controlled by a designated person. So, firms should carefully consider what steps are appropriate to manage their sanctions risk exposure and take steps fully to address that risk. The Government have committed £50 million to support a new economic deterrence initiative to further boost our diplomatic and economic tools and improve sanctions implementation enforcement, as well as tackling sanctions evasion across the trade, transport and financial sectors.

On our collaboration with our international partners, we work closely with the G7, particularly the EU and the US, and we have stepped up our engagement with a range of third countries to highlight circumvention risk—the noble Lord, Lord Purvis, alluded to this—and support them to tackle this issue. That includes joint diplomatic outreach to countries where we see spikes in the trade of sanctioned goods with Russia. We are particularly focused on the goods published in the CHP list.

In recent months, we have sent joint delegations to the UAE, Kazakhstan, Uzbekistan, Kyrgyzstan, Georgia and Armenia, as well as having senior bilateral engagement with Turkey and Serbia, to highlight these risks and offer technical support. We have funded technical support sessions delivered by UK legal experts to business and government contacts in Armenia, Georgia, Uzbekistan and Kyrgyzstan to improve understanding of and compliance with the UK sanctions measures and regime. These efforts are paying off: a number of countries have announced concrete measures to reduce the risk of sanctioned goods reaching Russia. The latest trade data indicates a downward trend in direct exports of these items to Russia from countries of interest, including some that I mentioned.

On why we have yet to seize Russia’s assets, we remain committed to exploring all lawful routes to using Russian sovereign assets in support of Ukraine. We continue to drive ambition within the G7, which has agreed to consider this issue collectively. We continue to work at pace ahead of the G7 leaders’ summit. I commit to keeping the House updated on significant developments as appropriate. While G7 discussions continue, the UK has taken a number of steps domestically. We were the first to introduce legislation explicitly enabling us to keep sanctions in place until Russia pays for the damage it has caused. We are establishing a route by which sanctioned individuals can donate frozen funds for Ukrainian reconstruction, and we have introduced new powers to compel sanctioned individuals and entities to disclose assets they hold in the UK.

With noble Lords’ indulgence, I will address a slightly broader question which I have perhaps not been asked entirely: how we are combating Russia’s war economy. We have banned all known items found on the battlefield in Ukraine. We have banned dual-use and critical industry, aviation, defence and security goods. We have published a common high-priority items list—a list of 50 battlefield items that are important for Russia’s war effort—helping businesses identify the most critical items to focus their efforts on. This is degrading Russia’s military and high-tech industries. Production of the next-generation airborne early-warning and control aircraft has stalled due to a lack of foreign components, including semiconductors. Russia is therefore turning to other countries to supply these goods. We see reports of that in the newspapers, but I reassure noble Lords that the UK is very much leading on this work and delivering results.

On the tit-for-tat arrangement mentioned by both noble Lords, I of course cannot account for what Russia may or may not do. Regarding advice to UK residents, journalists and other interested parties in Russia, I have not looked at the recent Foreign Office advice, but I am sure it has been kept very much up to date on a regular basis. But obviously, I caution all journalists operating in Russia to be aware of the case of Evan Gershkovich, whom the Russians really should have released by now.

I think I have answered all the questions. I cannot commit to proactive briefings now, but I will certainly bear in mind what the noble Lord said and make sure it is understood in the department.