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The United Nations panel monitoring sanctions against Osama bin Laden's al-Qaeda network has no evidence of links between the terrorist group and Iraq, group chairman Michael Chandler said Tuesday.

"We don't have anything yet, and no-one has been able to produce anything," he told AFP in an interview.

British Prime Minister Tony Blair told a parliamentary hearing in London on Tuesday that "there is some intelligence evidence about linkages between members of al-Qaeda and people in Iraq." He did not identify the individuals.

Speaking a day after seven people were arrested in a dramatic police raid on a mosque in north London, Blair said it was "inevitable" that terrorists would try to target Britain.

But he said he was unaware of any evidence that "directly links" al-Qaeda, Iraq and "terrorist activities" in Britain.

Chandler, who described al-Qaeda in a report to the UN Security Council as "a substantial threat, globally, to peace and security," said it was not obviously "in either side's interests to be linked at this stage."

He noted that Iraqi President Saddam Hussein runs what is "still quite a secular country" distinct from the Islamic regime of bin Laden's ambitions, and added: "Saddam doesn't want a caliphate; he wants to be in charge."

Chandler chaired a panel of five set up in January last year to monitor the enforcement of sanctions originally imposed in 1999 on al-Qaeda and the Taliban regime then in power and harbouring it in Afghanistan.

The Security Council renewed the sanctions -- an arms embargo, a financial assets freeze and travel ban -- in a resolution Friday which asked UN Secretary General Kofi Annan to re-appoint the panel.

It also asked governments to update reports on steps they had taken to enforce sanctions.

Chandler said only 79 of the 191 UN member states had responded to a similar request made a year ago, but added: "I would be reluctant to say any country is reluctant to cooperate; that is not what we are seeing."

Many countries had problems incorporating the necessary measures into their own constitutions and legal frameworks, he said.

He noted that it was difficult to impose a travel ban inside the 15-nation Schengen area, which has effectively abolished border controls throughout the continental states of the European Union, Norway and Iceland.

The restrictions apply, not only to al-Qaeda and the Taliban, but also to 104 people on a list compiled by the Security Council. Suspects are listed at the request of governments if no other government objects.

"Nobody who is on the list has actually been stopped from trying to enter a country," Chandler said. "That shows one of two things: either they are clever enough not to try, or the system isn't working."

He also noted that some suspects appeared on wanted lists around the world, but governments had not had them listed. They included four people sought by the FBI.

"We don't understand why. We have asked the question twice," he said.

Asked to assess al-Qaeda's strength and resources, Chandler replied:

"It's quite difficult to get a handle on a lot of things to do with al-Qaeda because of the way it has been able to disperse and perpetuate itself" since the massive US military assault which toppled the Taliban regime.

Governments were thought to have frozen 130-140 million dollars worth of assets, but few were willing to identify the owners of the bank accounts, he said.

"The amount of money needed for an attack is comparatively small," he said.

"Some people have put a figure of 74,000 dollars" on the twin bombings which killed 190 people in nightclubs on the Indonesian island of Bali on October 12, he said.

But, he went on, "I don't think anybody actually knows" how much money the network had.

Before it was routed in Afghanistan, al-Qaeda "was a kind of Holy War Inc., with managerial departments and people who could provide support, direction and possibly even finance down the chain of command," Chandler said.

The fact that it had managed to diversify showed "the extent to which feeling for this organisation has spread around the world," he said.

Al-Qaeda cells were being broken up in Europe, but there was a danger of new cells being formed to replace them.

"It is clearly much more difficult for them to operate than it was, but that does not mean we should be complacent," he said.

"Nor should we underestimate their ability to do something unpleasant. It has been too quiet for too long." 

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