Let's be clear: what this proposal means is that if Charles Clarke doesn't like your face, you can be put under house arrest and have your means of communication taken away from you.
In response to this proposal (and in relation to the ruling on the detention without trial of foreign "terror suspects"), the Director of Liberty, Shami Chakrabarti said:
The Home Secretary is right to show respect for the House of Lords damning ruling. However, temporary restrictions upon a suspects liberty are only legitimate as long as a criminal charge and trial are in prospect. We urge the removal of the legal bar on intercepted material being used in trials.
Adherence to the rule of law should not be a game of cat and mouse. The Government should not swap one human rights "opt out" for another.
I find this amazing too: the leading civil liberties group in the UK is, if I understand this correctly, advocating that covertly obtained intercepted communications should be admissible as evidence in court.
While this is probably the lesser of two evils, it's an indication of how far we have gone down the road to "1984" in such a short time.
See also:
http://www.liberty-human-rights.org.uk/issues/internment.shtml
http://www.guardian.co.uk/terrorism/story/0,12780,1399401,00.html
http://www.timesonline.co.uk/article/0,,2-1458262,00.html
http://www.timesonline.co.uk/article/0,,2-1458179,00.html.