§ 11.8 a.m.
§ The Secretary of State for Foreign and Commonwealth Affairs (Dr. David Owen)
With your permission, Mr. Speaker, I shall make a statement about Ocean Island and the Banabans. I apologise for its length but the issues are complex. On 24th January the House was told of the Government's intention to seek a settlement of the problems connected with Ocean Island and in particular the future of the Banaban community. To assist in achieving a solution Mr. Richard Posnett, the former Governor of Belize, was asked to visit the area. I am most grateful to Mr. Posnett for his valuable report on this long-standing and difficult problem. Copies of the report are now available in the Vote Office.
The Banaban concern is two-fold—constitutional and financial. On the former, the Banaban leaders have pressed for the detachment of Ocean Island from the Gilbert Islands, originally as an independent State, more recently as part of Fiji. We all recognise their deeply held views on this matter. Equally, the Government and people of the Gilbert Islands feel strongly that the island should continue to be part of the Gilbert Islands as it has effectively been for most of this century: indeed, from 1908 until the Second World War the seat of Government of the territory was on Ocean Island. Moreover, the island is some 1,400 miles from Fiji as compared with 240 miles from the Gilberts. There is only a small Banaban group—less than 100—now living on Ocean Island, and after phosphate mining ceases it would not be possible for the island to support more than a very small community. There are also strong legal, constitutional and historical objections to making territorial changes.
There can be no perfect solution, but given good will there can be an agreed compromise. My right hon. and noble Friend has been having discussions with Gilbertese Ministers this week about additional guarantees and safeguards which could be provided to the Banabans and assure them of a special autonomous position for Ocean Island within the Gilberts. The basis for such a relationship exists in the many close links of language, religion, 1758 culture and marriage between the Banabans and other islands of the Gilberts.
My right hon. Friend the Prime Minister and I shall naturally also wish to discuss the constitutional issue with the Prime Minister of Fiji when he comes here for the Commonwealth Heads of Government Meeting, not least because the vast majority of the Banaban community has long been settled on Rabi Island, which is part of Fiji.
I wish to assure the House that no final decisions about the future status of Ocean Island will be made before the pre-independence constitutional conference for the Gilbert Islands. The Banabans will of course be asked to this conference and will be free to put forward their views. I shall keep the House informed of progress on this issue.
On the financial issues, the Banabans claim that Ocean Island phosphate was exploited on terms greatly to their disadvantage and they engaged in prolonged actions in the courts on those grounds. The Vice-Chancellor in his judgment found for the Crown but expressed considerable sympathy with the Banabans and felt that they had not always been treated as well as they should have been. I think everyone in this House is very conscious of the great hardship and privation they suffered during the Second World War and wishes to see the whole issue settled honourably.
We have been concerned for some time for the future of the Banabans after mining ends. We have therefore had consultations with the Governments of Australia and New Zealand, our partners on the Board of British Phosphate Commissioners, about how we can best help the Banaban community, who number some 2,500, secure their economic future on Rabi when phosphate revenues cease in 1979 or 1980.
The three Governments are prepared to make available on an ex gratia basis, and without admitting any liability, a sum of 10 million Australian dollars. The money would be used to establish a fund which will be preserved for the benefit of the Banaban community as a whole, the annual income being paid to the Rabi Council of Leaders for development and community purposes. The money would come from funds which are held by the 1759 British Phosphate Commissioners on behalf of the partner Governments, the United Kingdom, Australia and New Zealand, and which would in the normal course of events have accrued to the respective Exchequers.
The payment would be final and would be made on condition that, in the outstanding legal actions, no appeal would be made in the case against the Crown and the early resolution of the cases against the BPC would be sought, and that no further claims would be made arising out of past events. The damages to be paid by the Phosphate Commissioners—damages which the Vice-Chancellor said should be neither merely nominal nor very large—are of course unconnected with, and would therefore be additional to, the ex gratia payment.
In the meantime, arrangements for the final phase of mining operations on Ocean Island, which are likely to terminate in 1979 or 1980, will clearly be of considerable importance to both the Banabans and the Gilberts Government. We shall be in touch with the Gilbert Islands Government about the best way of keeping the Banabans informed and involved at every stage and their interests adequately protected.
We regard the existing division of the phosphate revenues between the Gilbert Islands Government and the Banaban landholders as reasonable and do not envisage any alteration.
Other islands in the area have contributed in human terms to the Ocean Island phosphate industry, and the Government realise the need for help to those islands also when the industry comes to an end. We are giving further consideration to how this help might be given.
The Government have tried to meet the general concern expressed in both Houses of Parliament and elsewhere that the eventual solution should be fair to all parties. My right hon. and noble Friend in particular has shown a sympathy and understanding for the interests of all concerned in the region which have played a large part in securing this arrangement. The problems are difficult and legitimate interests conflict. But it is our hope that solutions may now be reached on the basis of compromise and co-operation between all the parties concerned.
§ Mr. John Davies
May I thank the Foreign Secretary for his statement and say that the House appreciates the fact that he has come forward at this time to make it, for many Members of the House are, as he knows, deeply anxious about the situation of the Banabans and their relationship with the Gilbert Islands and with phosphate production on Ocean Island?
The House will accept—and I hope that the Foreign Secretary, too, will accept—that we appreciate his endeavour to be even-handed in this matter. May I ask him, first, having regard to the fact that he states that his right hon. and noble Friend has been having discussions with Gilbertese Ministers this week, whether equivalent discussion has taken place with representatives of the Banaban community in relation to the proposals he is making?
Secondly, I wonder whether the Foreign Secretary could elucidate somewhat further the figures he has given to the House. It is important, with the context of the 10 million Australian dollars he proposes as a compensatory fund, to know what are the total funds in the hands of the British Phosphate Commissioners at this time and how much more in the way of funds is likely to accrue to the Commissioners between now and the cessation of extraction? It is only in the light of the knowledge of those total figures that the reality and the satisfactory size of the 10 million Australian dollars can possibly be appreciated.
May we also thank the Foreign Secretary for his undertaking to keep the House informed in these matters? Many of us would greatly wish to know how the further discussion to which his statement refers proceed, particularly in the light of the acceptability of the compromise formula proposed by him in relation to the financial compensation to the Banaban community.
§ Dr. Owen
I am grateful to the right hon. Gentleman. It is an extremely difficult judgment to make and it is difficult to remain even-handed in this complex issue. Consultations with the Banabans will take place. We are always available for further consultations. As I made clear in my statement, there will be a constitutional conference.
1761 The sum of money is to secure the economic future of the islands. It is not compensation. We estimate that the 10 million Australian dollars, invested now, would accumulate to 12 million dollars by the end of 1979 when the phosphates run out. This sum would give the benefits of unearned income of about 350 dollars per capita. This would be in addition to any earned income and any revenue produced by investing a further part of the 10 million dollars the Banabans are also likely to receive by way of phosphate revenue from 1st July 1976 until the end of mining.
I hope that that gives the basis of the statistics. The total fund currently stands at about 23 million dollars. Out of this the 10 million dollars would be taken. As I said, against that would have to be set whatever was for the replanting. We are giving further consideration to what can be done.
§ Mr. Thorpe
May we welcome the fact that this is at least some recognition of the claims of the Banabans, who unsuccessfully petitioned the House nearly 50 years ago? Having expressed that welcome, may we assume that it will be the right hon. Gentleman's resolve that this will be the last time that a small dependent people will have to pursue the British Government in the courts before their moral claims are met?
May I ask the right hon. Gentleman two further questions? First, will he tell us a little more about the 10 million dollars, which is a sum considerably less than that which was claimed? Is that to produce an infrastructure, to provide an adequate income? Are capital cash grants to be paid out? How is it to be done? Why should not the figure be paid out rather than have a fund set up?
Secondly, will the right hon. Gentleman accept that since the Vice-Chancellor has said that the British Government are in breach of a higher trust, we shall want to read very carefully the details of the fund when it is set up?
§ Dr. Owen
I am grateful for what the right hon. Gentleman said. I do not think that anyone looking back on history would claim that at all times all the right decisions have been made. We had to keep the matter in balance against a record of very difficult decision 1762 making. When the Vice-Chancellor delivered his five-and-a-half day judgment—it was a very long judgment—he paid tribute to some of the decisions which had been taken. It is a question of balance. The exact way that the money will be used is obviously for consultation with the Banabans. We hope that a trust fund will be established and that we shall be able to safeguard the money to ensure that it will be used for the benefit of the Banaban community in future and not in any way squandered. This is for further discussions.
§ Mr. Spearing
Does my right hon. Friend agree that the sum of 10 million Australian dollars appears rather low, as he told me on 24th February last that the Banabans had about 4 million Australian dollars in a single year—1974–75?
Does my right hon. Friend agree that the Gilbertese income per head is about half that of the Banabans' at present and that of the Solomon Islands one-quarter? In view of his statement, would it not be better for Her Majesty's Government to consider a proper settlement of the South Pacific as a whole with a view to British obligations being discharged there with clean hands and being seen to be so? Will he understand that some hon. Members do not think that that is the case in the statement that he has made, either in respect of the Banabans or in respect of other peoples throughout that zone of the Pacific?
§ Dr. Owen
I agree with my hon. Friend that we need to look at the South Pacific as a whole. I acknowledged in my statement that other islands had contributed to the Ocean Island phosphate industry and energy.
As to the question of the sum of 10 million Australian dollars, that is about £6½ million sterling, so it is not a negligible sum of money at the current exchange rate. It takes account of the fact that although the Banabans have received more than 7½ million Australian dollars in phosphate revenue over the last three years, they have, unfortunately, built up no reserve funds against the time when their revenue from Ocean Island will cease. We regard the existing division of phosphate revenues as reasonable. When hon. Members have time to read the very valuable report of Mr. Posnett, they will see that it provides 1763 substantially more than the 7 million Australian dollars suggested by him.
I have given the figures of the difference, but I confirm what my hon. Friend said—that the Gilbert Islanders are receiving less than one-quarter of what on average is the income received by the Banabans.
§ Sir Bernard Braine
Whilst acknowledging the Foreign Secretary's desire to make amends for the sordid and shameful treatment that the Banabans have suffered for many years, may I ask whether he does not realise that the sum that he has mentioned is only about one-fifth of what the Banabans would have earned from their phosphates if they had been given proper advice and information in 1947 and if there had not been grave breaches of trust by Her Majesty's Government, and that the sum will do very little to right the injustice?
Is the right hon. Gentleman aware that proper restitution to the Banabans could be made if Ocean Island is returned to them now and the Gilbertese are generously compensated for loss of revenue from any remaining phosphates?
Finally, is the right hon. Gentleman aware that until Ocean Island is separated from the Gilberts and returned to the Banabans, neither they nor any of us who care about our country's good name will consider that justice has been done?
§ Dr. Owen
The hon. Gentleman has taken a very great interest in this area, and I pay tribute to that, but, as he knows, his views are not shared by all hon. Members on his side of the House nor on the Government side of the House. The fact is that it is a question of judgment between the constitutional position in particular and the Banabans, and whether it is a relationship with Fiji or with the Gilbert Islands is very controversial, and people genuinely hold different views. What the Government have tried to do is to bring about an honourable compromise on this subject.
As to the question of the sum of money, the sum is not a negligible sum. In the view of the three Governments—and I must stress that this has to be something that is agreed by three Governments; I pay tribute to the Australian and New Zealand Governments for their help in the discussions and negotiations 1764 —this is a generous provision that will enable the Banabans to plan for their future on Rabi and finance that future, but it must take account of the per capita incomes of people in the area and the problems, to which my hon. Friend the Member for Newham, South (Mr. Spearing) drew attention, of the economic position of the whole of the South Pacific.
§ Mr. Christopher Price
Is my right hon. Friend aware that what we are talking about is the grossest and, one hopes, the last instance of imperial exploitation in this century, and that any settlement that we come to is very important for Britain's whole reputation in the whole of the South Pacific area? Is he aware that any financial arrangements that are made for the distribution of the money should not smack of British smug paternalism of the kind which, even in present negotiations with many islands in this area, is all too often present?
Further, may I thank my right hon. Friend for his keeping the constitutional position open, but will he tell us a little more about the constitutional position? Will he assure us that in the final resort he would not rule out an association with Fiji rather than one with the Gilbert Islands?
§ Dr. Owen
I have mentioned the special autonomous position. This has yet to be negotiated but, for instance, it could include an Ocean Island Council, elected fully by the Banabans, as the local government of Ocean Island, representation in the Gilberts House of Assembly, Gilbertese citizenship if the Banabans wished and the Government of Fiji agreed, special guarantees for Banaban rights on Ocean Island and for their share of the remaining phosphate revenue, and safeguarding all the Banabans' interests in the Ocean Island phosphate industry. This issue will have to be discussed. There will have to be a constitutional conference. When my hon. Friend has had the opportunity of reading the Posnett Report, I think that he will see the complexity. I know that he has raised the matter himself over the years.
As to the settlement, I do not come before the House saying that mistakes have not been made. Of course they have been made. One of the reasons for us trying to have an ex gratia payment is to settle this issue honourably. But I also 1765 think that we ought not to give selective interpretations of the Vice-Chancellor's judgment on this issue. Nor should we fail to look at the record of Britain's involvement in the Pacific, taking it in its historical perspective, because it has been an honourable record.
§ Mr. Paul Dean
I welcome the right hon. Gentleman's statement and the obvious co-operation from the Australian and New Zealand Governments in bringing about what seems to me to be a reasonable settlement for the Banabans. May I put two points to the right hon. Gentleman? The first concerns the financial arrangements. Will he give an assurance that the financial offer which is to be made to the Banabans will in no way adversely affect aid to the Gilbert Islands and the other countries in the area, including, of course, Tuvalu, Fiji and the Solomons?
Secondly, on the constitutional point, while welcoming the concept of autonomy for Ocean Island within the Gilbert Islands, may I ask the right hon. Gentleman to recognise the real dangers of fragmentation, not only to the unity of the Gilbert Islands but also to the other island nations in that part of the world?
§ Dr. Owen
There is no question of an ex gratia payment being at the expense of the Gilberts. Our aid programme for the Gilberts is a continuing one and is increasingly directed towards revenue-earning projects, against the time when prosphate revenue ceases. Our capital aid on projects totals £2.2 million in the current financial year. In addition there is a substantial programme of about £1.5 million for technical co-operation.
On the question of fragmentation, there is widespread recognition in the Pacific of the dangers of fragmentation. More generally, also, concern about the implications of fragmentation of territories there has been expressed in the United Nations on a number of occasions.
§ Mr. Townsend
I also welcome the part being played by Australia and New Zealand in the settlement, but does it not fall far short of the generous payment that is called for in the circumstances, following many years of exploitation? Will he carefully consider allocating some of the settlement to the Gilbertese, who have a very strong case?
§ Dr. Owen
This is a subject for further consideration. I recognise the need for keeping a balance between the need to settle the Banaban issue honourably and the need to discharge our obligation to the whole South Pacific area—trying to set any ex gratia payment in relation to the economies of the countries and the per capita income of the people of the area and the very dire poverty that exists in some of the islands. It is a question of balance. We have tried, with the Australian and New Zealand Governments, to achieve the right balance. I hope that the House will agree that we have at least done our best.
§ Sir J. Langford-Holt
Will the right hon. Gentleman bear in mind that the views expressed by my hon. Friends are held on both sides of the House? There is considerable anxiety over this matter, even on the part of those who have not studied it as closely as the right hon. Gentleman. Does he not agree that it is vital that on this matter he gets the wholehearted support of this House and that failure to do so would prejudice the rapid and successful passage through this House of a Gilbertese independence Bill?
§ Dr. Owen
I readily acknowledge that. I know that my hon. Friend the Member for Birmingham, Handsworth (Mr. Lee), who went out there with the hon. Gentleman to review this situation, would share many of his views. Of course there are different feelings about this. All I would ask is that hon. Gentlemen make a judgment on the ex gratia payment in relationship to the problem in existence in the South Pacific. I would urge hon. Gentlemen before forming a final judgment to read the Posnett Report. It is a very valuable and balanced account of the complex problems that we are dealing with, some of which were inherited and some for the future.