China and Hong Kong

HC Deb 13 July 1989 vol 156 cc1163-231

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Heathcoat-Amory]

Mr. Speaker

Before I call on the Foreign Secretary, I must tell the House again that 36 right hon. and hon. Members wish to participate in the debate. Sadly, because of the late start, they will not all be called. I intend to limit speeches between 7 pm and 9 pm to 10 minutes, and if those who are called before 7 will bear that limit in mind, many more of their colleagues will be able to participate.

5.4 pm

The Secretary of State for Foreign and Commonwealth Affairs (Sir Geoffrey Howe)

Mr. Speaker, last Wednesday I reported to the House on my visit to Hong Kong. The exchanges which followed that statement reflected the very deep concern felt by all hon. Members about the future of the territory in the wake of the recent horrific events in Peking. Very important questions are at issue here, and it is right that they should be fully aired in this House. The Government accordingly welcome this opportunity for further debate.

The House has before it the report on Hong Kong of the Select Committee on Foreign Affairs. I should like to take this opportunity to thank the Committee for its report. The Government's formal response will issue in due course. The House will share my view that that report addresses our concerns, and those of the people of Hong Kong, seriously and comprehensively.

We are all conscious of Britain's historic responsibility for Hong Kong's future, and of our obligation to act with vigour and determination in fulfilment of that responsibility. We have never sought to shirk that obligation. Indeed, we were guided by it when first we took the decision to enter into negotiations with the Chinese about the future of Hong Kong.

By treaty, 92 per cent. of the area of Hong Kong reverts to China in 1997. The remaining 8 per cent. could never be viable on its own. After 18 months of tough negotiation, it became clear that the Chinese Government were not willing to contemplate the continuation of British administration beyond 1996, so we set ourselves the task —with the support of the people of Hong Kong—of securing alternative arrangements which would maintain the stability and prosperity of Hong Kong and the freedoms and way of life of its people.

The agreement that we reached—the Joint Declaration was widely recognised at the time, in Hong Kong, in this House and around the world, as the very best that could be arrived at in the circumstances. It was not an agreement imposed on Hong Kong, but one which the Executive and Legislative Councils were each able firmly to commend to the people of the territory. Under it, Hong Kong will have its own Government comprising Hong Kong people, not people brought in from China; the Socialist system and Socialist policies will not be imposed on Hong Kong from China; nor will Hong Kong pay taxes to China. Hong Kong's capitalist system and its way of life will continue, with all its human rights and freedoms, its laws and its legal system, its own freely convertible currency, its financial markets, its free port. None of that will change.

Hong Kong will conduct its own relations with other countries on matters such as trade, culture and civil aviation, and be able to conclude agreements on those subjects. It will continue to participate in international organisations as it does today. Entry into Hong Kong from China will continue to be regulated as at present, so that Hong Kong will not be flooded by immigrants from the mainland. By contrast, Hong Kong people will remain free to come and go as they please. Public order will be the responsibility of the Government of Hong Kong, as it is today. It is plainly provided that any Chinese military forces stationed in Hong Kong will not interfere in internal matters. I shall have more to say about that in a moment.

The Joint Declaration was—and is—a good agreement, and the people of Hong Kong continue so to regard it. That was confirmed by the Office of the Members of the Executive and Legislative Councils in the statement which it circulated to Members of this House on 16 June. Indeed it described it as a "triumph of diplomacy". The declaration is accepted on all sides as the basis for all that now needs to be done to rebuild confidence in Hong Kong and, in particular, to strengthen the Basic Law in which the provisions of the declaration are to be given legal effect.

I do not in any way seek to minimise the anxieties of Hong Kong people about the future. It was precisely to address those anxieties honestly and directly that I took the earliest possible opportunity to visit the territory after the events of 3 and 4 June. The Joint Declaration is, as I said during that visit, a text for the bad times as well as for the good. Events in China have not invalidated it, nor altered the assumptions on which it was based—on the contrary.

What is lacking today, and what must be restored, is confidence—and confidence that China will honour the agreement after 1997. That confidence has been gravely shaken. It certainly cannot be restored overnight. It will take time and effort. That is why China's attitude in the coming months and years will be of such crucial importance. China has reiterated her own commitment to the Joint Declaration, and we welcome that, but more—much more—will be needed to regain the trust of people in Hong Kong. There must be concrete steps to provide reassurance to the people of Hong Kong—steps that will need to be continued and reinforced over the months and years ahead. Once again, there are signs that the Chinese Government realise this. They must now act accordingly.

Mr. Bowen Wells (Hertford and Stortford)

Can my right hon. and learned Friend confirm that the Joint Declaration, and the treaty registered by it in the United Nations, for the first time gives a treaty base—recognised and signed by China—for the future of Hong Kong?

Sir Geoffrey Howe

My hon. Friend is absolutely right, but I hope that he and the House will forgive me if I do not give way as I customarily do. I have had the opportunity to answer questions on this matter for three and a half hours in the House, and to answer my hon. Friend in the Select Committee for about six hours. If I am allowed to continue my speech I shall come to what the Select Committee said.

As we have always recognised, and as the Select Committee said in terms, it is not possible to provide absolute guarantees for Hong Kong's future". One feature has always been identified as providing some real assurance in that respect. That is the natural self-interest of China itself. It plainly must be in the interests of the Chinese Government—any Chinese Government—to sustain the success of Hong Kong and to do so in the only way that it can be done—on the basis of the Joint Declaration and the principle of one country, two systems.

For our part, Her Majesty's Government of course accept the need to formulate policy, to take action so as to offer further assurance to the people of Hong Kong, to strengthen their confidence in the future. First, as I told the House on 5 July, a Bill of Rights for Hong Kong will be introduced as soon as possible. The Joint Declaration already states that the international covenants as applied to Hong Kong shall remain in force after that date. The draft Basic Law reflects this in article 39. These are very worthwhile achievements but, understandably, the people of Hong Kong are looking for more, and the Government accept their concerns. The proposed Bill of Rights will ensure that there is one fundamental legal text which sets out all the rights and freedoms that the people of Hong Kong currently enjoy. In 1997 it will form part of the existing law and will continue after the transfer of sovereignty in accordance with the provisions of the Joint Declaration.

Secondly, we shall firmly and painstakingly persist, in all the ways that are open to us, in making an effective input into the drafting of the Basic Law. The Basic Law drafting process is at present in suspense. The Chinese have said that they intend to prolong the present consultative period. In considering the further timetable for promulgation of the final text, the Chinese should give full weight to the need to produce a Basic Law which commands the widest possible support in Hong Kong, and to the need for sufficient time in which to produce it. That should take priority over all other considerations. I urge the Hong Kong people, and in particular those who have the opportunity to serve on the Basic Law drafting committee, to take full advantage of every opportunity to express their views so as to ensure that the draft is further improved.

When the drafting process is resumed, our priority will be—as it has been all along—to see that the Basic Law conforms fully with the spirit as well as the letter of the Joint Declaration. As co-signatories of the Joint Declaration, it is our right to insist upon that point. Moreover, getting the Basic Law right—and being seen to do so—will have a crucial effect on confidence in the run-up to 1997. If it is to boost confidence, it will need to meet the specific concerns that have been expressed about the current draft. I will give one or two examples.

The Foreign Affairs Committee has drawn attention to the very real anxieties about article 18 of the draft Basic Law. In its present form, this could enable the central Government in Peking to declare a state of emergency in Hong Kong after 1997. As I said to the House on 5 July, this is one matter that we are taking up with the Chinese authorities. In our discussions with them about the Basic Law, before the drafting process was suspended, we had already impressed upon them the need for this article to be very tightly defined. Following the events in Peking, this provision is now of even greater concern. It is clear that at the very least the special administrative region Government of Hong Kong will have to be directly and closely involved in any decision as to whether or not a state of emergency has arisen. As the Select Committee has also recommended, article 157 of the draft Basic Law, which deals with interpretation, will need to be carefully reconsidered. There are genuine worries about this article in Hong Kong and a way must be found to allay them.

Another very important concern, to which the Foreign Affairs Committee drew attention, is that of the stationing in Hong Kong of Chinese military forces. This goes to the heart of the fears of people in Hong Kong about their future. That is why we negotiated long and hard to secure agreement to the principle that Hong Kong would be responsible for its own internal security after 1997. and we achieved that objective. The provision is there, in annex one (section 12) of the joint declaration. The Hong Kong police force is being expanded to enable it to take on this role.

Nevertheless, the horrific events of 3 and 4 June have undoubtedly greatly intensified concern in Hong Kong on this point. We shall therefore be doing all that we ca .n to bring home to the Chinese Government the fact that their deeds as well as their words will be of fundamental importance. On this issue, the Chinese should not lose the opportunity to send a clear message of reassurance to Hong Kong's people. The question was already under active discussion in the Joint Liaison Group. The work of the group is, for the moment, suspended, but the group will continue to have the key role in ensuring the implementation of the Joint Declaration. No one in Hong Kong would dispute that the Joint Liaison Group will need to meet again before long, with this issue at the top of the agenda.

The next issue with which I wish to deal has already commanded a good deal of attention in the House—the development of representative government. It is an issue which requires the most careful and considered judgment. The Government therefore noted with particular interest what the Foreign Affairs Committee had to say on the subject. We agree with the Select Committee that the views of Hong Kong people on this matter are of crucial importance. We have always sought to base our policy on the principle that the pace of development should reflect the wishes of the whole community.

The unanimous view expressed by OMELCO on 24 May was a very significant step towards the establishment of a consensus in Hong Kong. After the events of 3 and 4 June, we must seek to determine how far that consensus now extends. It would be wrong for us to seek to anticipate that study, but it is already clear that the Hong Kong Government will need to reconsider their present plans for the elections in 1991.

My visit to Hong Kong left me in no doubt about the importance of another major issue—the prospect that emigration from the territory, particularly but not only by well-qualified professionals and middle managers, will increase. Everything that has been achieved in Hong Kong has been built on the energy and ability of its people, so the emigration of talent is a matter of great concern. The House accepts, and I hope that the people of Hong Kong will come to understand, that the answer to this problem cannot be found in the prescription most frequently pressed in Hong Kong—the granting of an open-ended right of abode to all British dependent territories citizens in the territory. It is seen as an insurance policy, but unlike any other such policy it is an insurance policy on which claims could be made by all the potential beneficiaries at any time. The practical difficulties of absorbing hundreds of thousands—possibly millions—of people make that impossible to contemplate. It would be wrong to raise expectations that we could not possibly meet. I do not believe that the House would support such a departure from the immigration policies pursued by successive British Governments since the early 1960s.

Nevertheless, it is surely right that we should do what we can to sustain in those people on whom the success and prosperity of Hong Kong significantly depends the confidence to remain. Their continued presence in the territory benefits everyone living there. If they lose faith in the future, all of Hong Kong will suffer. That is why we are working urgently on a scheme which will make some provision for people in both the private and public sectors on the basis of value of service to Hong Kong, as well as connections with Britain. New legislation may be necessary. Our response will be as generous as it can be, within the inevitable constraints.

Our objective will be to devise a scheme which is as open and fair as possible, consistent with the overriding aim of encouraging people whose service is of value to Hong Kong to remain there. That applies to those involved in the administration of Hong Kong—and not exclusively at the senior levels, and to those whose professional, technical, entrepreneurial and managerial skills are essential to helping Hong Kong to remain prosperous and stable. It also applies to those in particularly sensitive posts. A further, more detailed announcement will be made as soon as possible.

The international community at large has an important interest in Hong Kong's continuing success as a major financial and commercial centre. In our contacts with our partners and friends, we are emphasising that they, too —as democracies, and as major trading partners—have a role to play in sustaining confidence in the territory. We shall be making this point at the economic summit in Paris this weekend.

I was most interested in what my right hon. Friend the Member for Guildford (Mr. Howell) had to say on this subject over the weekend. Clearly we must distinguish between two distinct factors, which the Select Committee report identified. The first is the immediate need to reinforce confidence in Hong Kong. We hope that the scheme to which I referred will make an important contribution to that. The international community can help in that respect by making it clear that they continue to have confidence in the future of Hong Kong and in the Joint Declaration.

The second distinct factor is the action that might and should be taken in the case of some fundamental and overwhelming violation of the Joint Declaration. That is obviously something that we are all hoping to avoid and working to prevent, but we cannot, in all prudence, ignore the possibility. The people of Hong Kong need to be given the strongest possible assurance that, should the worst come to the worst, there would be help for those in need of a home of last resort. That reassurance would be greatly strengthened by a wide international acknowledgement that this is a problem with which no one country alone could cope. I have already discussed the issue with a number of Foreign Ministers. The House will have noted what Prime Minister Mulroney of Canada said in London on Tuesday, 11 July: We should all be ready to co-operate with the United Kingdom in the delicate and important task of re-establishing grounds for confidence among the people of Hong Kong that their territory has a secure, viable and democratic future well beyond 1997. The problem of Hong Kong is not only and just a problem for the United Kingdom. The problem of Hong Kong and its security and well being is a problem for the world.

Sir Russell Johnston (Inverness, Nairn and Lochaber)

Before the Foreign Secretary leaves this central and important issue, will he say a word about the views of the governor of Hong Kong, which he has not yet mentioned? I think that it would be fair to say that the governor would not altogether go along with what the right hon. and learned Gentleman has said.

Sir Geoffrey Howe

The governor's views—which, as the hon. Gentleman knows, were quite properly expressed to the Select Committee—have been taken into account both by the Government and by the Select Committee in reaching our conclusions. I wish to take this opportunity once again to pay tribute to the distinguished way in which the governor carries such a formidable burden upon his shoulders.

The task of turning the general concern of civilised nations into an explicit willingness at some future date to contemplate receiving people from Hong Kong is not something that can be easily achieved; it certainly cannot be achieved overnight. Over the coming weeks and months we shall be using every opportunity to raise the issue with our partners and friends.

The growing problem of human migration is one of the starkest and most intractable of our time. It has manifested itself most acutely within Hong Kong in the presence of almost 50,000 Vietnamese boat people. I told the House last week of the measures being taken to tackle this problem effectively and humanely. My hon. Friend the Parliamentary Under-Secretary of State will respond further to points on that issue in his closing speech.

Sir Philip Goodhart (Beckenham)

Can my right hon. and learned Friend give an assurance that physical force will not be used to compel those unfortunate men, women and children to return to a Communist country from which they have spent most of their lives trying to escape?

Sir Geoffrey Howe

The balance of the argument in that respect was set out in my statement last week. It was also dealt with in the report of the Geneva conference. My hon. Friend will recollect the conclusion that for those who do not qualify as refugees there is no prospect of passing through Hong Kong to a future somewhere in the remainder of the world which cannot and does not exist. In those circumstances, the entire balance of argument must point in the direction of trying to secure their return to their own land. That was the view expressed by the Geneva conference, and we must lend all our efforts to that end.

Our deep, immediate and continuing anxiety for Hong Kong is inevitably linked to our wider concern about the course of events in China. The House, the Government and the British people have repeatedly condemned the Chinese Government's blatant and reckless use of force against unarmed civilians. In common with other countries, we have concluded that business as usual cannot and should not be sustained in present circumstances. China must be left in no doubt as to the damage that her international reputation has suffered, but in our response we must have clearly in mind what we want to achieve. We want a secure future for Hong Kong and we want China to return to the path of genuine reform. Neither the international community, nor the Chinese people—nor, in particular, the people of Hong Kong—will gain if China is driven into inward-looking isolation.

It was with those considerations in mind that I announced a package of specific measures in my statement to the House on 6 June. Those steps have been paralleled by other Western countries. The Madrid European Council on 27 June agreed a set of measures reflecting those already taken by some partners, including the United Kingdom. The United States, Japan and others have adopted mutually reinforcing measures of their own. All are intended to bring home to the Chinese authorities the extent of our common concern.

However, in the interest not least of the people of Hong Kong, channels of communication must remain open. That was the clear view expressed when I was there last week. Hong Kong does not—indeed, cannot—wish to isolate China, and neither should we. For that reason, the Government do not accept the argument that we should impose blanket trade sanctions on China. Such measures have never worked in the past. They would be damaging to the Chinese people, for whom we have great respect, and with whom we wish to build a closer friendship, and they would be immediately damaging to Hong Kong, which has an enormous stake in China's economic development.

China and Hong Kong are each other's largest trading partner. Hong Kong provides nearly a third of China's foreign exchange earnings and two-thirds of her foreign investment. Sanctions would tend inevitably to drive the Chinese into a corner and would put a severe brake on the economic reform process which gives hope to the Chinese people for the future. Therefore, in common with the American Government, the Japanese and our EC partners, we do not intend to stand in the way of normal commercial dealings. For the time being, however, we have postponed consideration of concessional financing arrangements for new projects in China under the aid and trade provision. We are also suspending decisions on additional ECGD cover for China.

I told the House yesterday that the exhibition "British Expo: China 89" due to open in Peking in November has been postponed. The House will also be aware that the World Bank has deferred consideration of new loans to China, in view of the current economic uncertainty there. Those are all reasons for the Chinese authorities to demonstrate that they intend to stay on the path of economic reform and openness—an essential element of which must, as the European Council noted on 27 June, be respect for human rights.

At the end of the day, China will choose its own destiny, but measured and consistent expressions of concern from the international community about Chinese political repression can and will have a significant impact. Nowhere is that prospect more important than in Hong Kong, for Hong Kong's future must inevitably lie with China. The members of OMELCO, in their statement of 19 June, said: We are Chinese and proud of it".

However, they equally and rightly insist that Hong Kong's way of life is, and should remain, distinct. That is the essence of the assurance of "One country, two systems". The interests which led China freely to accept that undertaking remain as valid today as they were when the undertaking was given. If anything, they are stronger. In the economic sphere, it is no longer just a question of foreign exchange—millions of people in the neighbouring province of Guangdong are directly employed by Hong Kong enterprises.

China must recognise that her actions have damaged confidence in Hong Kong and that she has a vital role in repairing that damage. We have already been transmitting that message to the Chinese Government and we shall continue to do so. In the same spirit, and to the same end, it would, I think, be right for us to take advantage of any sensible opportunities that may arise for contacts for that purpose between Ministers with responsibility for Hong Kong.

For almost 150 years, Britain has administered Hong Kong with fairness, justice and dedication. We have forged a unique partnership between Britain and the territory's Chinese inhabitants. That partnership has survived many tests and has gone from strength to strength. The last eight years of British administration which lie ahead will pose new and difficult challenges, but our commitment to the people of Hong Kong will be as strong as ever. Her Majesty's Government will strive with all their energy to achieve a secure and succesful future for Hong Kong and its people.

5.29 pm

Mr. Gerald Kaufman (Manchester, Gorton)

The Foreign Secretary has referred to his visit to Hong Kong and, as he will know, last month, through the courtesy of the Hong Kong Office, I was able to go there too. During my visit, an Air Force helicopter flew me along the border between the New Territories and the People's Republic of China. Almost immediately below I saw the forest of skyscrapers that is the Chinese city of Shenzhen.

A year ago, I was in Shenzhen and marvelled at the dynamism which had created that burgeoning and booming commercial centre in such a short period. Like others who at that time had the opportunity of visiting China, I was profoundly encouraged not only by the economic progress that China is making but, even more, by the implications for political liberalisation of that economic progress. I was able to discuss with Chinese officials the optimistic prospects for economic links between Shenzhen and Hong Kong, of which the Foreign Secretary has just spoken—such a tiny distance separating them; economic links both before and after 1 July 1997.

Now, sadly, it is impossible to use the word "optimistic" in relation to Hong Kong. The natural misgivings of the people of that territory about the unknown factors in the impending transfer to China had been alleviated by the positive achievement of the Joint Declaration of 1984 and the progress made since in drafting the Basic Law—progress involving genuine consultation between China and the people of Hong Kong. Now, developments in China, and especially the massacres in Peking, followed by the stream of executions since then, have made Hong Kong wary about how much it can trust the Peking regime to adhere to the Joint Declaration.

That is why, just as I did, the Foreign Secretary will have heard during his visit to Hong Kong from representatives of the people there—none of them, I am afraid, directly elected; that is something for which the Labour party when in government must bear responsibility with the Conservative party when in government—about safeguards for which they are looking in the period before the Basic Law is completed and before it goes forward for enactment by the National People's Congress of the Chinese People's Republic.

Many of those safeguards are considered in the report on Hong Kong of the Select Committee on Foreign Affairs which was published the week before last. As I shall explain, I do not agree with all that report's conclusions and recommendations, but it is a most important document which contains much valuable material and many positive suggestions which ought to be adopted. I congratulate my right hon. and hon. Friends who, together with Conservative Members, worked so hard and expeditiously to complete that report.

The report deals with large matters and with matters which appear to be small but which, nevertheless, are important. For example, I draw attention to the recommendation in the report about the location of the British consulate general and the importance of it being prestigious. Those of us who were in Hong Kong not long ago and saw the huge demonstrations and signs outside the office of the New China news agency will know the symbolic importance that the people of Hong Kong will attach to the location of an office. I hope that, when the Government come to respond to the report, they will deal with that matter among a number of others.

The members of the Committee tried to come to terms with another problem to which the Foreign Secretary referred a moment ago—the apparently intractable problem of the boat people from Vietnam. No one who has seen the conditions in which the Vietnamese are held in Hong Kong—I in no way criticise the Hong Kong authorities who, in the circumstances, have done a miraculous job in providing conditions of cleanliness, good health and good food, but, nevertheless, the conditions are so awful that no one who has seen them can fail to be moved by the plight of the people in those centres and camps—

Mr. Chris Mullin (Sunderland, South)

Does my right hon. Friend agree that one assurance that we can give the people of Hong Kong is that, however rough the going gets, we shall never hold refugees from Hong Kong in conditions quite as deplorable as those in which many Vietnamese refugees in Hong Kong are held?

Mr. Kaufman

I very much hope that that would never occur. I am sure that it would not.

In its report, the Select Committee recommends mandatory repatriation of migrants from Hong Kong. I shrink from such a solution, but I can understand why the Committee arrived at that view. The flow has to stop, and it is arguable that the best way of stopping the flow is for potential migrants in Vietnam to witness the return of their compatriots and so realise that migration is fruitless.

I am more persuaded by the views put forward by the British Refugee Council which would entrench protections for human rights in any policy aimed at dealing with the problem. I value the council's recommendation that People who are not granted asylum should not be returned to Vietnam unless there is clear evidence that it would be safe for them to do so, firm assurances are given that they will not be penalised in any way, and their well-being and resettlement are thoroughly monitored by the United Nations High Commissioner for Refugees. The key to solving the problem and obtaining such assurances is to accept the British Refugee Council's views about the relationships with Vietnam. The council says: The desperate poverty in Vietnam must be tackled as a matter of urgency and we urge Western governments to mount a major aid programme and improve relations with Vietnam. We believe that economic aid and improved relations will make a major contribution to improving the human rights situation which will also help to stem the flow of refugees. Economic development will encourage others to stay and those who have left to return. The British Refugee Council goes on to say: Normalisation of relations with Vietnam by the West and the lifting of trade and aid embargoes are essential, and should not be tied to negotiations about refugees. However, they will begin to address one of the root causes of migration. People will only stop leaving when they see hope for the future for them in Vietnam, and that depends on the resumption of international co-operation with the Government. Those are sensible and important suggestions.

Meanwhile, I hope that when people in Hong Kong seek the right of abode in Britain and wonder why their demands are not immediately accepted, they will take into account the problems caused to them by the arrival in Hong Kong of migrants from Vietnam, who are only one eighth of the proportion of their population that British dependent territory passport holders in Hong Kong are of the population of the United Kingdom.

Much attention has understandably been focused on what the Select Committee's report says about demands for right of entry to Britain and right of abode here of Hong Kong British dependent territory passport holders, to which the Foreign Secretary referred this afternoon.

The Labour party agrees with the report's conclusion, which, as I understand it, is also the Government's view, that it would not be right to offer any commitment to those passport holders on the right of entry to the United Kingdom or the right of abode here.

I do not believe that it is possible to obtain or offer definite international guarantees of the kind proposed in the report to British dependent territory passport holders, but I agree with the spirit of the report that this is a matter on which international discussions should take place with a view to obtaining assurances about policy in the event of a crisis after the transfer of Hong Kong to China in 1997. I trust that that matter will be a major item on the agenda for this weekend's Paris summit, and on the agendas of the Commonwealth Heads of Government meeting in Kuala Lumpur in the autumn and of the European Community summit at the end of the year. It should also be the subject of discussions between the Government and the United States Administration.

The Select Committee suggested that limited relaxations of our immigration laws should be implemented for specific groups in Hong Kong, and we can travel a certain distance with the Committee in that respect. We see no difficulty in offering right of abode to the very small number of war widows. In the Labour party's policy review report published two months ago, we made a clear commitment to non-Chinese minorities in Hong Kong, to whom right of entry is also recommended by the Select Committee. We accept the Committee's recommendations in respect of certain students having a clear and specific link with this country through their physical presence here. Those are all small and finite categories. As the Government are still considering them, I understand why the Foreign Secretary did not mention those categories this afternoon. However, I hope that the Government will find it possible to accept all those recommendations. They could so so without creating any controversy at all in this House.

We cannot agree with the Select Committee's recommendation for limited relaxation of our immigration laws in respect of two further categories, including people described as occupying key positions. Last week, when responding to the Foreign Secretary's statement on his return from Hong Kong, I told him that we recognise that certain Crown servants might feel or find themselves at risk as the transfer of Hong Kong to China approaches. We consider that it would be right for the Home Secretary to consider using his discretion under the Immigration Act 1971 in their favour, on an individual basis. The Committee's report also refers to the Home Secretary exercising his discretion under the British Nationality Act 1981. That option should also be considered positively. Such discretion should be used generously where appropriate, but it would not be right to create a special catch-all category of Crown servants, as the report recommends.

When I met Dame Lydia Dunn in Hong Kong and again in Britain, I was impressed by her argument—also made by those who argue for a blank right of abode, which we do not accept—that the creation of elite categories would be divisive and could not be defended in Hong Kong. Dame Lydia's view is that the creation of such categories would make it more difficult to govern Hong Kong. Still less do we accept the proposal to give assurances to people of affluence or influence in the private sector, which would be socially divisive. I see no reason why such people should be given preference over any other British dependent territory passport holders in Hong Kong. Morever, I cannot see how such a group can be defined, whether in an Act of Parliament or in an immigration rule, without introducing invidious distinctions. While we shall examine the scheme that the Foreign Secretary said the Government are considering, we have grave doubts about its implications.

While we go some but not all of the way with the Select Committee on the right of entry and abode, we accept almost completely its recommendations for progress with democracy in Hong Kong. I hope that, when the Government respond to the Select Committee, they will not go for the lowest common denominator—as they did when the Hong Kong Government issued a White Paper on representative government last year. That was a serious error, as is confirmed by the events that have taken place in China since then.

We concur with the Committee's view that 50 per cent. of the places in the Legislative Council should be directly elected in 1991 and that full direct elections should be introduced for 1995. We also agree with the Committee that the chief executive should be elected, but prefer election by direct adult suffrage rather than through an electoral college after the transfer of sovereignty in 1997, as proposed by the Select Committee. We also agree with the suggestion made to me when I was in Hong Kong that the chief executive should be made accountable to the Legislative Council. It is most important that as much direct, representative, responsible and accountable democracy as possible should be available in Hong Kong before its transfer to China in 1997.

We see merit in the Committee's recommendations that assurances should be sought from the Chinese Government on the Basic Law and the Joint Declaration. It would be constructive to achieve continuity in the interpretation of laws existing before the creation of the Hong Kong special adminstrative region, so that there can be confidence in the judicial system. We support the Committee's recommendation for a Bill of Rights and are glad that the Government are already acting on it. It is important that the Basic Law accords in every particular with the Joint Declaration.

In debate on the Basic Law one year ago, I drew attention to certain apparent discrepancies between the Basic Law and the Joint Declaration and expressed the hope that they would be remedied. For that reason if for no other, it is important that the Hong Kong representatives should resume their work on drafting the Basic Law. I understand completely why they withdrew from that work, and in the circumstances they were right to do so. However, as the draftsmen's absence gives the representatives of the People's Republic of China a much freer hand and would provide them with excuses if the Basic Law is regarded as being unsatisfactory, when it is completed, it is proper that the Hong Kong representatives should return to the work of drafting it. Even so, I agree with the Foreign Secretary that the People's Republic should consider favourably extending the timetable for the Basic Law process. The British Government should strongly represent that view to the Chinese Government.

The Foreign Secretary spoke of making contacts with Chinese Ministers where appropriate, and mentioned the possibility of meeting his counterpart at the United Nations in the autumn. The right hon. and learned Gentleman should also consider an early formal and specific meeting with his counterpart, because it is important to put issues directly to the Government of the People's Republic. Above all, and in line with the view of the Select Committee, the Government should put it to the Government of the People's Republic that the People's Liberation Army should not be present in Hong Kong after the transfer in 1997. To the whole world, the current image of the People's Liberation Army is one of blood and barbarism. Even if the People's Republic expresses contrition—which so far it shows no sign of doing—it will take a long time for that image to fade.

I find particularly repulsive reports in today's newspaper of a trip around Tiananmen square yesterday for western tour operators. I find equally repulsive the mercenary and cold-blooded statements made by some of those tour operators when they visited the area where the massacre took place and saw physical signs of it. It is clear that the Chinese Government believe that the slaughter in Tiananmen square can be easily forgotten and that, after routine protests by western liberals, it can quickly be business as usual between the Government of the People's Republic of China and the democracies. It is essential that the Chinese Government are made to understand with crystal clarity that memories are not so short, and that horror cannot so speedily be erased.

That is why we on this side take exception to the attitude expressed yesterday by the Foreign Secretary towards the mission of the 48 Group which is due to visit China in October. We deplore any British business group visiting China so soon after the massacres. To exchange pleasantries in Peking so soon after a barbaric crime is insensitive enough. To drive past the site of that atrocity, as the mission is bound to do during the five days when the group is due to be in Peking, is even worse. Worse still is to tout as an attraction a meeting with Li Peng, the Prime Minister of the Government responsible for the massacres. Yet the Department of Trade and Industry is providing financial assistance to the mission. The brochure says: DTI support will be available to participants in the mission on the usual terms, as a contribution to travel cost. Official facilities will be drawn upon to the full. Lord Young, the Secretary of State for Trade and Industry, is on record as welcoming and commending the mission.

In the full immediate flush of horror at the Peking massacre, the Foreign Secretary said: there can be no question of continuing normal business with the Chinese authorities."—[Official Report, 6 June 1989; Vol. 154, c. 30.] That firm and clear attitude has not lasted much longer than the time that it took to utter the words. Yesterday, the Foreign Secretary took every opportunity to defend not only the trade mission but Government support for it.

I wish that the right hon. and learned Gentleman would understand what use the Chinese authorities will make of the arrival of such a high-powered mission officially sponsored by the British Government. The propaganda value is incalculable. Does he not realise that to continue Government sponsorship of such a mission will encourage the Chinese Government to believe that, no matter what they do in the future or have done in the recent past, the British Government will accept it? The Government should cancel their sponsorship of the mission without delay. To continue sponsorship will send absolutely the wrong signal to Peking.

I do not say that there must never again be trade relations between Britain and China. Nor do I say that there must never again be cordial or even close relations. China will outlive this regression, just as it outlived the cultural revolution, to rejoin the wider world community in a more open and encouraging way than ever before. If China is to become a welcome member of the world community again, with all the wisdom and experience that that ancient nation can bring to civilised exchanges, she must first demonstrate that what happened in Peking last month was an aberration that will not be repeated. While the Chinese Government continue the present sickening series of executions, many of us will not be convinced.

Yet we want to be convinced. We want to believe that the enormous encouragement that we have drawn from the remarkable Chinese experiment in economic pluralism can be resumed. Our admiration for the Chinese people, their skill, industry, cheerfulness and bravery, continues unabated. Our admiration for those who stood up publicly for democratic values at their own peril is admiration for the real China, which many of us have visited and marvelled at.

We want to resume close friendship and personal relations with the Chinese Government. We ask them to make that possible. We say to them, end the executions, give clear and firm assurances to Hong Kong, and show by responding to what we ask for on the Basic Law and the Joint Declaration that, although we have been living through a nightmare, that nightmare will soon come to an end.

5.53 pm

Mr. Edward Heath (Old Bexley and Sidcup)

It is now some 20 years since I first went to Hong Kong, and in the intervening period I have returned there many times. I have developed an immense admiration for the people of Hong Kong and their achievements, which have grown progressively faster over those two decades.

When the Joint Declaration was signed it was natural that the people of Hong Kong were anxious about the future. But in the few years that have elapsed since then confidence in Hong Kong has grown, and economic activity and financial success have continued and even increased. Then came the tragic disaster of last month.

The Foreign Secretary was absolutely right to go to Hong Kong. He has been criticised in some quarters for it. He must have known the reception that he would receive, but his visit was invaluable not only for him to see at first hand the circumstances in Hong Kong and to inform his colleagues in the Government of them, but as a lightning conductor for the intense feeling on the island. For that he should be most strongly commended. His services to Hong Kong and to this country in so doing have been invaluable.

In the words of some friends of mine in Hong Kong, we are still stunned by the traumatic experience through which we have passed. Many of us here, too, are still stunned by the trauma in Peking and other big cities in the People's Republic of China. I acknowledge immediately that I am one of them. No one believed that it could possibly happen. How could it happen when the people at the top had themselves suffered during the cultural revolution? Deng Xiaoping said to me, "I am here only because Mao Tse-Tung said that not a hair on my head was to be damaged." His son was thrown out of his college window, his back was broken and he was denied treatment. How could those in authority in Peking have allowed the massacre to happen, or indeed authorised it? We still need to know the whole story. Perhaps we shall never know it, but the ghastly tragedy was there for us all to see.

The pernicious and dishonest journalist, Edward Pearce, has accused me of condoning the massacre. I have never condoned it for a moment. I am not ashamed that in 1972 as Prime Minister I brought about full diplomatic relations with the People's Republic of China. It was in the interests of this country and Hong Kong that we should have friendly relations with China. In my first discussions with Mao Tse-Tung I obtained from him, in the presence of Zhou Enlai, Deng Xiaoping and Hua Guofeng, an undertaking that nothing serious would happen in Hong Kong and that the changeover in 1997 would be peaceful. That was a valuable undertaking from those in control then and who proved to retain control in the following years. I could not possibly condone for one moment the massacre in Peking and the executions and shootings in the other cities that followed.

I now come to the position in Hong Kong today. The Foreign Secretary is right to emphasise that an increase in confidence is required above all. He would be the first to add that that is the most difficult thing in the world to bring about. It is difficult to achieve that in any circumstances, let alone in circumstances as bad as these.

I agree with the right hon. Member for Manchester, Gorton (Mr. Kaufman) that perhaps Peking will now realise that it has shocked not only Hong Kong and Britain but the rest of the world, and that it will take a considerable time to restore confidence. It remains to be seen whether, as happened after the cultural revolution, there emerge people who want to promote peaceable development in that enormous country, not only economically but politically. I do not underestimate the political difficulties of changing organisations and institutions in a country of 1,050,000,000 people. I have never been able to work out what the most admirable constitutional arrangement would be and I have never met anybody who could. That must be acknowledged. But until we see proof that the movement is political as well as economic, we shall find it very difficult to regain our confidence in Peking.

I have differed in the past with my right hon. and learned Friend the Foreign Secretary on the question of the speed and the form of democratisation in Hong Kong. He mentioned it again today, saying that it was receiving consideration. My view is that the only action that we can take in the near future that would do something to restore confidence in Hong Kong is to speed up both the timing and the method of democratisation. I am afraid that I have always believed that the advice that my right hon. and learned Friend received was wrong. It came from the wrong people, who had an interest in maintaining the present circumstances, first, because they could not trust democracy in Hong Kong and, secondly, because they wanted to be in a position to hand over Hong Kong in 1997.

Let me repeat my request, which I have made in two earlier debates: that my right hon. and learned Friend—who is backed by the organisations in Hong Kong—should speed up the process and the method of democratisation.

Mr. Robert Adley (Christchurch)

I do not think that anyone in the House dissents from my right hon. Friend's sentiments about democracy in Hong Kong. Does he recall that fears used to be expressed that the two most widely organised political bodies there would turn out to be the Communist party and the Guomindang? Does that still obtain, and is it a danger that we need to consider?

Mr. Heath

I agree that that was said. The answer is to get the other organisations in Hong Kong going, which would maintain the democratic basis. Surely we as a country have enough experience to help Hong Kong to organise its parties in that way.

I know that others have taken the view that Hong Kong will never have a party organisation. I do not accept that, and what my hon. Friend has said denies it. The existing groups—even if they are not categorised as political parties —are there and will act. I hope that any status that the Communist party in Hong Kong may have had has now been demolished by events in Peking, but that does not alter the fact that we must play our part—or, at least, the governor and his council must play their part—in the organisation of a great democratic system in Hong Kong.

I do not agree that those in Hong Kong have a right of abode, or that we are under an obligation to create such a right. I think that it is our responsibility to consider the practical side of the question as well as any moral or traditional, historic, national or legal obligations. The practical problems are on our doorstep: there are between 40,000 and 50,000 Vietnamese refugees in Hong Kong. Have we been able to persuade the world to accept them? Not at all. A mere trickle is returning to Vietnam. Of the 29,000 Ugandan Asians expelled by Idi Amin, we took 25,000; the Americans took 1,000, the Canadians 1,000 and the Swedes 2,000. That was a big enough problem, and some of us have been damned for it ever since. With Hong Kong, we face a major practical difficulty.

What worries me particularly is the fact that, if we accept an obligation in 1997 because of circumstances that may exist then, we shall place on our successors a burden that we ourselves need not shoulder. There will be a different Government—perhaps of the same party, but with different people in it—[Laughter.] Naturally, I hope that my right hon. and learned Friend the Foreign Secretary will still be here.

A different Parliament—perhaps two Parliaments hence—will have to carry out the obligation that we have accepted and that we shall have placed upon it. I do not consider that a proper responsibility for us to accept for the future.

Mr. Nicholas Budgen (Wolverhampton, South-West)

Does my right hon. Friend agree that perhaps the worst betrayals that this country has ever perpetrated have been when we have made promises to, for instance, countries in central Europe without being aware of the circumstances in which we might have to honour those promises? That entirely supports his view that, if we made a promise now that would have to be implemented by others in the future, we might find that they—for good reasons—had to go back on it.

Mr. Heath

It will be a wonderful day when I make a speech, on whatever subject, into which my hon. Friend does not introduce the European Community and its treaty.

Mr. Budgen

That is not the point.

Mr. Heath

Of course, a nation is responsible for any treaty into which it enters, but those treaties could have been changed at some future date under the terms of a later treaty. I do not wish to become involved in an argument about whether they should ever have been established; that is part of history, and will be in the memoirs.

Then we come to the worrying question of people leaving Hong Kong in the intervening period. I agree with my right hon. and learned Friend that he has an obligation where officials are concerned, but I should have thought that it would be possible to deal with that on a financial basis with sufficient inducements for people to stay until 1997, with an undertaking that they were prepared to do so. I do not believe, however, that the Government are obliged to make an arrangement involving the managers of private enterprises. That must depend on the enterprises themselves, and they have an interest, in exactly the same way as Peking has an interest, in maintaining the position of Hong Kong for its financial and industrial and trading future.

Once we get past that, the risk of accusations of discrimination is immense. The argument will go as follows: "You can say that so-and-so is more valuable to Hong Kong than the man in the street, but if people are to suffer, why is he to be let off while the man in the street suffers?" It is as simple as that. I cannot see a means of implementing a layer of special arrangements without Parliament and the Government being accused of unjustifiable discrimination. That is the immediate problem that awaits us.

Let us try to look to the future. We hope that Peking will now have recognised the disastrous impact on the world of what has happened. Did it realise at the time? If so, why did it allow the world to see it on television? Why should all the telephone lines have been open throughout the episode? Let us hope that it now realises and will change; and let us see a change similar to that which followed the cultural revolution and to what—as far as we know—is happening in the Soviet Union today.

We can say this about Peking: when it gives international undertakings—this is an international undertaking, registered with the United Nations—it adheres to them. When it gives financial undertakings to, for instance, investment banks, in my experience, it adheres to those. That may be one hope for the future —that, having given an undertaking registered with the United Nations, Peking will adhere to it.

Let us be open and frank. We now face the most difficult task in politics: to remain patient in unknown circumstances that we cannot control and to which we can see no immediate answer. I hope that, both here and in Hong Kong, we can prove that we are able to master it.

6.9 pm

Mr. Paddy Ashdown (Yeovil)

It is always difficult to follow the right hon. Member for Old Bexley and Sidcup (Mr. Heath) because his speeches are very carefully listened to and well worth listening to. I agree with almost all that he said, except for the curious assertion that we cannot take a decision or make a commitment today because it would lay a burden on future Governments and future generations. I should have thought that that was the basis on which we always go ahead. It is not an unreasonable basis in this area, too.

Five years ago, in 1984, I first spoke in the House on the subject of the Joint Declaration and Hong Kong. On that occasion I remember congratulating—I do so now—the Government on having put together the Joint Declaration. I believed then, and I believe now, that it is the foundation on which we must go forward. It was a not inconsiderable diplomatic achievement. However, I recall saying at the time that that good foundation would be significantly undermined if Britain failed to honour its moral obligations. I also recall saying that I was depressed because I did not hear the genuine fears, anger and sense of betrayal which were felt at that time in Hong Kong being echoed in this House. It gives me no pleasure whatsoever to note that, following the appalling and tragic events in Tiananmen square, the predictions and comments that I made then have come all too tragically true.

In a sense, it does not matter how much faith Britain puts in the Joint Declaration, or how much faith China puts in it. To be able to make it work, we have to ensure that there is faith in Hong Kong that it will work. If there is no faith, the basis upon which it was drawn up—one of the articles to which we committed ourselves being to hand over Hong Kong with a prosperous economy and a stable society—will be undermined. The people of Hong Kong will believe that the agreement is not worth the paper on which it is written and that it cannot be delivered. In a real sense, Hong Kong is the silent partner in this bilateral agreement between Britain and China. The survival and success of the Joint Declaration requires the people of Hong Kong to believe that it can work and that it will be observed.

The Foreign Secretary was absolutely right when he identified the purpose of the Government's actions and those of the House as being to recreate a sense of trust and belief in the Joint Declaration so that Hong Kong can remain economically prosperous and socially stable.

It is my case—I argued it five years ago, I have argued it in the lead-up to this debate and I argue it now—that at the heart of the re-establishment of that trust is the need to provide the people of Hong Kong with the capacity, as free citizens, to leave Hong Kong. Part of the Joint Declaration and of the agreement that the Government rightly reached with the Chinese was that the Chinese would follow what they referred to as an open door policy. People would be free to leave Hong Kong. However, an open door is useless unless, when one walks through it, there is somewhere to go. It may be that the Government of the People's Republic of China will honour their side of the open door agreement, but that agreement is meaningless unless we are prepared to underpin it, too. The freedom to have somewhere to go to is the bottom line in any action that is taken to ensure that the people of Hong Kong feel confident about the future.

We can have as much democracy as we wish, but it will not work if people are always looking over their shoulder at a tyrant who is just round the corner and who is prepared to lock them up for their views—if not today, tomorrow. It would be wrong of us to believe that democracy is like some magic charm that we can wave in the face of People's Liberation Army tanks and they will go away. If that was our belief, God knows, it must have been snuffed out after the terrible events in Tiananmen square. What will happen if those events are, despite our best efforts, recreated in Nathan road, Kowloon after 1997?

There is no earthly reason why those who are rich enough, clever enough or skilled enough will want to stay to make Hong Kong work and keep it prosperous and socially stable if, at the end of the day, the status that they are generously granted is not that of a free citizen but that of a refugee. If people do not stay now, the capital which underpins the financial stability of Hong Kong will leave, too. The question whether we honour that right of abode is not one that can be traded off against greater democracy. It lies at the heart of and underpins everything else that we do to establish and preserve stability in Hong Kong.

Before I come to that matter, let me deal with a few of the comments that are germane to the debate and that were referred to by the Foreign Secretary and others. I join the right hon. Member for Old Bexley and Sidcup and the right hon. Member for Manchester, Gorton (Mr. Kaufman) in congratulating the Government on having shifted their position. For the past five years all of us have argued that the issue of democracy is very important—that the arrival and takeover by the People's Republic of China of the special administrative region of Hong Kong should be more than simply a question of sending in a man with a screwdriver to change the nameplates on the door of Government house. An established democratic process in Hong Kong would ensure that that would happen.

The Foreign Affairs Committee report was correct and wise in saying that the time has come to increase the pace of democracy in Hong Kong. It said something else which is also important. The decisions that must be taken about the pace of the adoption of democracy in Hong Kong are delicate and careful ones. They could unbalance political and economic stability in Hong Kong. In that sense, the Foreign Affairs Committee report was correct. What must guide us in the decisions that are taken about the pace of democracy are the views of the people of Hong Kong. It is far better that they should take their own decisions, in so far as that is possible, about the pace of democratisation than that we should draw up blueprints in Westminster or Whitehall.

Some of the ingredients of the democratisation process include a chief executive in Hong Kong. I share the view that it would be better if the chief executive were elected on a free franchise of all voters in Hong Kong than in an electoral college. The time of the excellent governor, Sir David Wilson, will run out naturally before 1997. I take the view that it would be extremely helpful to Hong Kong if his replacement were to be not a Foreign Office official but a politician, or some other person of independent standing in the United Kingdom.

It is correct to say that the Joint Declaration is the basis for going forward. There are voices—

Mr. George Foulkes (Carrick, Cumnock and Doon Valley)

I am astonished by what the right hon. Gentleman has just said. Does he not think that at some point before 1997 it would be better for a Hong Kong Chinese national to take over that role to prepare for the role as chief executive instead of importing someone from the United Kingdom? I do not know whether the right hon. Gentleman is offering his own services. However, it is a strange suggestion.

Mr. Ashdown

I hear the hon. Gentleman's words, but there are two arguments. I do not intend to tell him now which I think is the better argument. I have no doubt that the hon. Gentleman believes, as I do, that the views of the people of Hong Kong are important. The Under-Secretary of State for Foreign and Commonwealth Affairs is laughing. I wonder what the Government's stated view on this is now? There is a balanced argument, which I shall put to the hon. Gentleman in the terms in which it was put to me by very senior people in Hong Kong. The prevailing view among the Chinese on OMELCO and UMELCO is that it may be better not to have a Hong Kong national in those circumstances precisely because of the divisions that it might cause. The view in Hong Kong, and it is one to which the House must pay attention, is that it would be better to have an independent and objective person from the United Kingdom. I ask the hon. Gentleman to think a little more carefully about that.

The Joint Declaration is the right basis for going forward. There are those in Hong Kong, including Martin Lee, who believe that it should be scrapped. That would be wrong, dangerous and destabilising. We should strengthen the Joint Declaration by any means that we can. The right hon. Member for Old Bexley and Sidcup said that the Chinese are good at honouring agreements. He is correct, but there is one exception—the Sino-Tibetan agreement of 1951, which, rather chillingly, used the phrase, "One party two systems". That agreement has been repudiated and ignored, leading to the destruction of religious, cultural and political systems, the flight of 100,000 people from Tibet and the death by starvation and execution of 100,000 more. Almost as a dress rehearsal for the events in Tiananmen square, two months earlier there was a major descent on dissident elements in Tibet and hundreds, if not thousands, of people were summarily arrested at midnight on March 7.

I am not sure that I can take the same comfort in the Chinese honouring agreements as did the right hon. Member for Old Bexley and Sidcup. The Government should consider reinforcing the Joint Declaration, or perhaps the Basic Law internationally in the United Nations, not just by its registration as a treaty, but by passing a resolution before the Security Council. As China has a veto, it would be interesting to see how it would react. The Government should consider reinforcing the Joint Declaration or the Basic Law by guaranteeing powers or appointing people to scrutinise and investigate its operation.

I now come to the Basic Law and the legal system. I welcome the Government's agreement that we should have a Bill of Rights, but I ask them to look carefully at the June 1989 Amnesty report which points out some worrying factors about the use of the death penalty in Hong Kong and safeguards against torture and arbitrary detention.

I share the Foreign Secretary's view on sanctions. I do not believe that sanctions would be appropriate at present, but the Government should recognise that China may be considered for chair of the United Nations Commission on Human Rights later this year. I hope that the Government will make it clear that any such decision would be extremely unwelcome and that they will oppose it.

On nationality, I believe that there is a moral obligation. Britain has handed over people to their own Governments many times before, rightly and properly, in the dismantlement of our empire. But we have never handed over an entire people to another Government, let alone to a Communist tyranny. We cannot remove the special responsibility for that special act by irresponsible scaremongering with figures such as 3.25 million. Everyone who has studied this matter knows that there is no possibility of 3.25 million people coming to Britain before 1997. A poll carried out by the South China Morning Post shows that 6 per cent. might come here before 1997. However, it is possible that they will come here if, to use the governor's expression, Armageddon should strike after 1997. The Government have already accepted responsibility for providing homes for the people of Hong Kong should Armageddon strike. The difference between the Government's proposals and mine is that their proposals would not allow an orderly transferral of citizens, but instead would require a panic plan to house penniless refugees.

What would happen if we gave right of abode now? Perhaps 6 per cent. would come here. However, as 1997 approached, many others would make preparations to take out an insurance policy in Britain in case the worst should happen. Hong Kong Chinese tell me that they would begin investing in Britain and establishing subsidiaries of Hong Kong firms here. They would prepare for that eventuality by diversifying their businesses.

Instead of orderly preparation, as was considered in the Corry report which suggested that under those circumstances there was a real possibility of economic benefit to Britain, and instead of an orderly approach to a desperate human problem, the Government are producing policies that rely on a mass influx of penniless, destitute refugees. Their policy is designed to bring about the very scenario that they say that they are trying to avoid.

Peter Kellner was right when he wrote in The Independent: What would really mess things up would be for Hong Kong's business people, teachers, doctors and engineers to settle in the United States, Australia and West Germany and for its pensioners, unmarried mothers, waiters and street-cleaners to come to Britain.

Mr. Adley

Everyone seems to consider the problem in terms of United Kingdom immigration policy. Will the right hon. Gentleman consider the following scenario for Hong Kong, which is more likely and would be more damaging? Hong Kong has the Joint Declaration because of its usefulness to China. If we were to do as the right hon. Gentleman suggests and gave people in Hong Kong the right of abode now, and anything should happen in the next eight years to create a blip in confidence and people started to leave Hong Kong in numbers, a slow departure could become a flood and Hong Kong could lose some of its best people. It would then lose its attraction to China. Where would Hong Kong be without its attraction to China?

Mr. Ashdown

The hon. Gentleman's useful interruption takes me to my next point. The Government's argument is that that would encourage just such an exodus. At present there is no evidence for that. Why should people leave Hong Kong at present? It has a growth rate of 8 per cent. a year, it has a much more pleasant climate than ours and it is a well-ordered and beautiful city. The Government have provided their own answer by saying that they will give a right of abode in Britain to make sure that the skilled people and the administrators will stay in Hong Kong. They argue that the way to make sure that the skilled remain in Hong Kong is to give them the right of abode in Britain. If that applies to those people, why does it not apply to the rest?

Unless the assurance of the ability to leave is given, the people of Hong Kong will begin to leave. That is exactly what is happening. The Canadians are setting up seminars in hotels in Hong Kong to attract the best people to Canada because they do not have the confidence to stay in Hong Kong. The French are issuing passports to those working in French banks. When Singapore offered the opportunity of relaxation, there were 25,000 people outside the Singapore offices. Just down the coast, there is a large population of Chinese with Portuguese passports and the Portuguese have given them the right of abode.

As a result, families are being split and the best and the brightest are leaving Hong Kong. There are the beginnings of a flight of capital. Once again Government policy seems absolutely dedicated to undermining the financial and social stability that they wish to preserve, weakening the credibility of the Hong Kong administration and increasing instability. That policy is mad and nonsensical. The Government's selective approach is divisive and against the recommendation of the Hong Kong administration and adds to the worry about that general policy.

There is another broader consequence. The sense of betrayal and anger and the concern about Britain not living up to her responsibilities are not confined to Hong Kong but are spreading to other nations round the Pacific rim. A senior British business man who runs one of the most established firms in the colony said to me that the Government's actions had the potential of doing as much damage to Britain's interests in the far east and the Pacific basin as Britain's actions in Suez did to our interests in the middle east.

We should offer right of abode. That is not too much. If people think that it is too much, perhaps we should try to reinsure that risk internationally. I was interested in the amended plan, published in a newspaper article the other day, put forward by the right hon. Member for Guildford (Mr. Howell), and I hope that we will hear more details. It may offer a way forward. In that article, he said that there must be a way round this difficult matter, if sensible brains can address it properly.

This is not just a moral issue. It is a practical way of underpinning democracy in Hong Kong. The only power that the people of Hong Kong will have to pit against the might of the Chinese Government after 1997 will be the power to withdraw the one thing that China needs so badly —a prosperous Hong Kong. If we make that power a reality, the power to limit the PRC's actions will be stronger. That is why I believe that our commitment to the establishment and preservation of democracy after 1997 depends on ensuring that we make a commitment before 1997 that the Chinese can leave Hong Kong if they wish.

This is not the first time that we on the Liberal and Social Democrat Benches have stood alone making these arguments. I did this five years ago. My hon. Friend the Member for Inverness, Nairn and Lochaber (Sir R. Johnston) did it about a year ago and my right hon. Friend the Member for Tweeddale, Ettrick and Lauderdale (Mr. Steel) has done it several times. I am proud to say that our party believes that we have a moral and practical duty to honour the right of abode that underpins democracy in Hong Kong.

I am depressed by two factors. First, I am depressed by the attitude of the official spokesman for the Labour party, the right hon. Member for Gorton. It is incomprehensible that the Labour party voted against the 1981 regulations the consequences of which it is prepared to accept. I contrast the Labour party's words in that debate, when it declared its opposition to that legislation, with the attitude that it is taking today in support of the Government. I especially remember the words of the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley), who is now deputy leader of the Labour party. On 4 June 1981, in committing the Labour party to repeal the legislation, he said: The necessity for repeal and replacement is all the greater, not least because the Bill is largely based not on Government theories about nationality, but on Government fears about immigration."—[Official Report, 4 June 1981; Vol. 5, c. 1159.] Now we note that the Labour party is joining in fanning those fears about immigration.

I remember the words of the hon. Member for Holborn and St. Pancras (Mr. Dobson) when he summed up that debate: Nationality is a fundamental concept which ought to be decided on principle and not on expediency. The Bill is shot through with expediency from start to finish, which springs from the artificial fears which the Conservative Party and others have attempted to create among the British people about the prospect of others immigrating to this country." —[Official Report, 4 June 1981; Vol. 5, c. 1178.] Brave words, but abandoned words. I think of the Labour party in its great period, when it helped with the dismantlement of empire. I think of the Labour party as a great defender of civil liberties, the rights of ethnic minorities and international justice. I compare that with what I see now—a sham, hollow replica of that Labour party. We now see the new model Labour party facing its first moral challenge—and it has failed.

I am depressed at the attitude that the House takes to these matters. We have never in our history taken a decision like this. Of course, we must hand back Hong Kong in 1997—we have no other option—but that means the territory, not necessarily the people. I ask the House to pause and think of the enormity of the act that we are contemplating. We hand over 6 million people to a Communist tyranny, all of whom are our responsibility, half of whom are our passport holders and the majority of whom fled from that tyranny in fear of their lives. We hand them over to a tyranny of old men who have only recently slaughtered their young citizens on the streets of the main square of their capital city for daring to believe in democracy.

The House shrugs its shoulders. It says, "We can do nothing about this. There is no way that we can help in that circumstance." My party does not believe that, and we shall divide the House. Britain is now writing the last pages in the history of its empire. If the House allows the Government to get their way in this matter, there will have been complicity in ensuring that those last pages are grubby, shameful and discreditable pages in what should be an important and glorious history.

6.35 pm

Mr. David Howell (Guildford)

The Select Committee on Foreign Affairs will be grateful, I know, to nearly all right hon. and hon. Members for the way in which they have received its report after its inquiry into the position in Hong Kong. It is always nice for members and the hard-working staff of Select Committees to have their work appreciated. In fact, it is nice to get their reports debated at all. We certainly appreciate the comments that my right hon. and learned Friend the Secretary of State, the right hon. Member for Manchester, Gorton (Mr. Kaufman) and others have made about this study.

It was obvious that in the first place the reception given to the Select Committee's report in Hong Kong was very different. There were cries of "Shame" and "Dishonourable", and many other rough words were used. I, for one—I suspect that I speak for all other members of the Select Committee—see nothing dishonourable in stating firmly and clearly at the outset what we are capable of doing and what we think should be done. Nothing could be worse—as others have said more eloquently than I— than making commitments now that later, disastrously, we cannot keep.

Mr. Michael Marshall (Arundel)

Does my right hon. Friend accept that one of the most telling paragraphs in the Select Committee's report is paragraph 4.10, which discusses the scale of the problem? The right hon. Member for Yeovil (Mr. Ashdown) glossed over what could be a major problem. Does my right hon. Friend accept that there is a genuine problem in terms of refugees seeking to qualify as British dependent territory citizens and adding to the numbers?

Mr. Howell

If I have time, I shall consider those matters in more detail.

Having had the opportunity to talk to a number of visitors from Hong Kong since the visit by my right hon. and learned Friend the Secretary of State, I do not think that it is too optimistic to say that, on further study of what my right hon. and learned Friend, the Select Committee report and many people who are interested in Hong Kong's future are trying to say, there has been a slightly better and less hostile reception.

I have no doubt that my right hon. and learned Friend the Foreign Secretary has shown courage—the courage to say no. That is a difficult act of statesmanship. He has been accused, as we have, of not fulfilling obligations. We have unique obligations to the people of Hong Kong. In a sense, my right hon. and learned Friend is the embodiment of the fulfilment of those obligations, with his ceaseless visits to the territory and, above all, his achievement of an agreement that is unique in history. I remind hon. Members that one of the treaty partners—the People's Republic of China—agrees to forswear the right for its political system to be operated in a piece of territory that will be within its sovereign control. It is extraordinary that there will be capitalism and no Socialism will be allowed. It would be unconstitutional for Socialism—I apologise to Opposition Members—to operate in the special administrative region of Hong Kong. My right hon. and learned Friend has gone almost as far as possible in statecraft and politics in dealing and grappling with this appallingly difficult issue.

We are now moving into the realms of psychology and psychological reassurances, and some of the most complex and difficult issues that the House has ever been asked to face, particularly the unique issue of how we devise reassurances. It is not a matter of keeping people here, letting them go or allowing them in, but how to devise reassurances to keep people in another place—in Hong Kong. That is a difficult, complex issue.

There are three matters raised in the report with which I wish to deal, and the first is relations with China. The report carefully examined the relationship between the two treaty partners, ourselves and the People's Republic of China. We had some fairly firm words to say in paragraph 3.5 about the importance of further discussions and advice on the Basic Law, discussions in the joint liaison group, and any administrative changes in Hong Kong itself being built on the principle of recognising the needs of Hong Kong. During our visit to the territories, we heard and examined suggestions—we found no hard evidence or validity for them—from many leading opinion-makers in Hong Kong that not enough account had been taken of the needs of Hong Kong and that too much attention had been paid to second-guessing and apprehensions about what the Government in Peking really want for Hong Kong.

That period has passed. I do not think that there was validity for such fears, but they existed, and it is important for the Government to ensure that, from now on, not a scintilla of doubt is left in people's minds that the British and the Hong Kong Administration are pursuing the interests of Hong Kong. We must ensure that the Basic Law—which the Chinese are drafting and have reasserted is to be promulgated on the original schedule, although the length of the consultation period has been extended—at least conforms with the Joint Declaration, the remarkable document that was secured by my right hon. and learned Friend five years ago.

The situation is reinforced by the simple fact that the PRC now has a vastly greater interest in moving in a way that will maintain the stability of Hong Kong. In a sense, the dangerous and unpredictable giant has weakened itself by the horrors of the night of 3 and 4 June in Tiananmen square. It is now as much in China's deep interests as it is in our interests to see that everything necessary is done to maintain stability in the territory. That is what the Select Committee has to say about that matter. Perhaps hon. Members will elaborate on it.

The second matter is democracy. It is quite right that Hong Kong must decide. That must be the governing principle. The Select Committee took the liberty of offering its view. In discussions, the Select Committee did not see why it should not offer its own views, given the way in which the democracy issue is handled and is germane to maintaining stability in the territory. Our strong recommendation is that democracy should be entrenched before 1997. The recommendation is ahead of the decision that was taken by the Hong Kong Administration and the British Government before the massacres, and ahead of the view that was taken at that time by the Office of the Members of the Executive and Legislative Councils, on 24 May. Since then, I have heard that OMELCO is again examining the matter and is moving to support for an even more rapid timetable. I am sure that my right hon. and learned Friend will keep in close touch with that matter, the development of ideas within the territory, and the move towards entrenching democracy.

There has been a turnaround. There were people who used to say, "We have done very well without democracy in Hong Kong; why do we need it? It is destabilising and will bring out the Kuomintang and other things." Quite often, the same people are now saying the opposite—that the dangers of introducing democracy and stability too quickly are more than outweighed by the imperative need to ensure that Hong Kong is a strongly entrenched democratic institution and society by 1997 and that that will give it a strong and vibrant place under the sovereignty of the PRC, but as a democratic unit, the voice of which the world and, of course, Peking, its sovereign power, will recognise.

The third point is nationality. The Committee expressed the view that others have expressed, that the idea of granting right of abode to the existing 3.28 million people in Hong Kong who are eligible for British dependent territory passports, let alone the other 2 million or so who will be eligible in coming years, is an impossibility. I paraphrase the Select Committee's words, but the conclusion is obvious. It is an impractical, implausible and therefore worthless undertaking.

No country can put its immigration policy into commission. That is what it would be. We can talk about it being an insurance policy, but with an insurance policy the person providing the cover has certain criteria upon which a claim is honoured. In this case, the right to make a claim would be delegated and put in commission. In effect, it would put not merely our policy of 27 years standing but our entire policy in these matters into commission.

It is a great pity that able minds and much money in Hong Kong have been mobilised behind an advertising and public relations campaign to go on hitting against the single narrow target of right of abode for all those passport holders in the United Kingdom. It will cause grief, be a misdirection of energy, and keep alive unfounded expectations and divert the vast abilities of the Hong Kong people from thinking about their own situation in a more realistic, international way.

As for categories, the Select Committee's report endorses the view, which is now the view of my right hon. and learned Friend and the Government, that there should be eligible categories for passports. My right hon. and learned Friend has said that a package of proposals will come forward. That will be difficult, just as everything is difficult in this matter. Of course, expectations in Hong Kong, even on that narrow point, are growing. There are two views in Hong Kong. One is that the numbers must be very large. I have heard quite responsible people suggest that anything less than 100,000 will be worse than nothing. Others have said that everything would be worse than nothing and that it is such a divisive concept that it would be wrong for any categorisation at all to take place, particularly those who say that it is an all-or-nothing argument—either a right of abode for everybody or nothing.

Perhaps I am too frank, but the divisions are there already. Perhaps between 500,000 and 1 million people in Hong Kong already have passports. They can go anywhere they like. Many of them can already come here. To talk about it being divisive, to deny that perhaps not very highly salaried people doing absolutely vital work in law and order and administration should also have the reassurance of that passport—I accept the reassurance argument in this context—is a little unfair and crude, and does not recognise the importance of these matters.

Therefore, there are two voices in this. I believe that it is right to opt for categories, although there has been strong advice from some quarters that the whole thing should be dropped. This will be a difficult issue to bring forward, but I know that my right hon. and learned Friend the Foreign Secretary has approached it with his usual extreme care and subtlety.

At the end of paragraph 4.15, the Committee referred to longer-term assurances and said—I paraphrase—that the British Government should take a lead with our EEC partners and with other immigrant-receiving countries, such as Australia, Canada and the United States, in putting in place and seeking to establish the definite assurances that are needed in the years ahead. I believe that that is the right direction for the Government to take. As I said earlier, that is a very much better direction into which the energies of the people of Hong Kong can be diverted than is knocking their heads against the unavoidable and pointless objective of passports for everyone.

It has already been said by our EEC partners that they do not want to know about these things. As we look at this issue it is worth bearing in mind the Portuguese question. Of course, as the right hon. Member for Yeovil (Mr. Ashdown) said, the numbers are quite different. I understand that the Portuguese are to give 100,000 full citizenships—not just passports—to the Chinese people in Macao, and that there has been talk of almost double that number.

The Portuguese example follows a different policy line from the one that we have adopted. Let us think for a moment about what it implies in Europe. Those people will become citizens of Portugal but in due course, when Portugal has fulfilled all its obligations and has become a full member of the European Community, those people will become citizens of the EEC. That will not happen immediately elsewhere because there are questions about right of settlement and right of abode for people coming to this country. However, I imagine that it will apply immediately in the case of Portugal and that the people who take up that right will be free to go anywhere in Europe—and that they may well do so.

If we are honest with ourselves, we know—I expect that my right hon. and learned Friend knows this full well—that at the moment every EEC country is facing the most severe and frightening prospect of mass immigration of one sort or another—whether from the Maghreb or anywhere else. Anyone who thinks that the problems of other EEC countries are not ours in relation to these pressures from outside and to the enormous volume movements of world immigration and emigration—and vice versa, that our problems are not theirs—is living in another world.

My right hon. and learned Friend is right to have discussions on this with the rest of the European Community—I shall come to the wider world in a moment —so that future pressures can be met in an orderly way. Those pressures are coming—only an ostrich with its head underground could deny that fact—and we shall not be able to deal with them alone, any more than we can contemplate the ideas about passports alone.

Mr. James Couchman (Gillingham)

Is it not a fact that the Portuguese have always granted rights of citizenship to those born in their colonies of Portuguese parents and that the British Nationality Act 1981 confirmed that that would continue to apply in Macao?

Mr. Howell

Yes, I believe that it is. That point simply emphasises the problem.

The Committee urged my right hon. and learned Friend to take the lead in this matter. I hope that he will consider what we said. Indeed, he has already given a response that sounded extremely positive on that.

My own view—this is not the view of the Committee which has stated its views in the report—is that other countries such as the United States, Australia and Canada and, as we have recently read, Singapore, which has announced a figure of 25,000, although I gather that larger numbers are now contemplated, should become involved in what is, in effect, an underwriting scheme. It is a scheme for keeping those people in Hong Kong, which is what we are concerned to do.

I hope that the offers and assurances can be taken up, and not only if catastrophic events overwhelm the territory. Although my right hon. and learned Friend referred to such circumstances when he spoke to the Committee, that is a fuzzy concept. In reality, there would not be one single morning on which there was an overwhelming catastrophe. There would be ugly and rising tensions and dangers with sudden large groups of people seeking to leave the colony. Of course, one does not want any of that to happen—it is unpleasant even to have to talk about it—but we must realise that there will be circumstances well short of a neatly defined "catastrophe" —whatever that means—in which enormous pressures will come upon us and for which some provision and pre-vision would be desirable.

On a narrower scale, the flexible package that my right hon. and learned Friend will use on behalf of the Government is a first pebble in that pool, as are the ideas of the Singapore Government and the proposals that we are now hearing from the United States Congress.

Mr. Ashdown

I do not want to take up too much of the time of the House. We are all listening with great care to the right hon. Gentleman's personal views on this issue, which I find encouraging. Those views are obviously what he referred to in the Asian Wall Street Journal. However, I hope that he will not be guilty of raising the hopes that he has accused others of raising in Hong Kong. To be more specific, is he referring to an international agreement giving a promissory note in the event of catastrophe? Is he referring to something which would generously allow the people of Hong Kong to be considered as refugees in the event of terrible occurrences in the future, in which case such a provision would do nothing to keep people in Hong Kong—or is he referring to a commitment to citizenship? If he is not to raise people's hopes falsely, I hope that he will be a little more specific.

Mr. Howell

There are real difficulties in setting out what one suggests other countries should come together on and examine and the things in which my right hon. and learned Friend should take the lead. I am seeking to address perhaps unsolicited advice to the people of Hong Kong and am saying, "Please cease aiming all your huge energies at the right of abode for everybody"—which, if I understand his intervention, the right hon. Gentleman seems to think they should still work for—"and divert it into examining ways of seeking international assurances." I have used my words very carefully—I shall not repeat them because they are on the record—about in what circumstances those assurances should be given.

There is interest in this problem all around the world. It is not confined to just this country, as my right hon. and learned Friend recognised in his earlier remarks. Whether we "take a lead" as the Select Committee suggested or not —and, in my view, we have in a sense taken a lead—there are many other things to be done. The Bill of Rights is to be put in place. My right hon. and learned Friend is moving vigorously on that. There is also the question—

Dr. Jeremy Bray (Motherwell, South)

rose—

Mr. Howell

I am sorry, but I think that I must rush on because I have taken too much time already.

There is also the question of keeping the People's Liberation Army out of Hong Kong. The Select Committee warned about that, and I know that my right hon. and learned Friend has noted our words. There is also the question of the physical, long-standing, long-enduring construction of a mighty building which would be the Great British consulate-general, showing that Britain will remain interested in the territory for years and years ahead. It would be a physical manifestation of our interest. There is also the recommendation in our report that the issue of the boat people should be dealt with. I shall not elaborate on that difficult issue now. There is also the final interpretation of the law, which we suggest should be clarified, and there are proposals for the development of democracy.

Most of those aspects of our report were denounced in Hong Kong in the heat of the moment. Now is the time for cooler consideration. Of course, as my right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath) has said, ultimately the interests and the future of Hong Kong depend on China. For all its unpredictability and for all the hideous upheavals of recent days and the past, China has stayed predictable throughout about Hong Kong. Even in the moments of blood, smoke and horror, we must remember that basic fact.

In eight years' time Hong Kong becomes a ward of China. We must make sure that it remains also a precious godchild of Britain, Europe and the whole free world. A secure future can surely be built on that basis.

Mr. Deputy Speaker (Sir Paul Dean)

I remind the House that the 10-minute limit on speeches operates from 7 o'clock, and I appeal for the co-operation of hon. Members.

6.59 pm

Mr. Dennis Canavan (Falkirk, West)

The current situation in Hong Kong has been described as a crisis of confidence. We can certainly understand why the people of Hong Kong have no confidence in the Government of the People's Republic of China after the recent atrocities in Peking and elsewhere, but they also have decreasing confidence in the British Government. Indeed, the feeling among many of them is that they are being betrayed. The first duty of the House, therefore, is to restore their confidence—especially when we consider their valuable contribution to the wellbeing of the people of Britain over many years.

We must consider the best way to restore that confidence. There have been suggestions from some quarters that the Joint Declaration should be torn up, but I believe that that would be unrealistic and undesirable. The track record of the Government of the People's Republic of China—despite what has been said about Tibet by the leader of the Democrats—has been generally a good one in terms of keeping to international agreements and treaties. The recent events in the People's Republic of China, horrific and deplorable though they have been, have not invalidated the Joint Declaration.

What can we do to ensure that the Joint Declaration is implemented, to achieve security for the people of Hong Kong and political, social and economic stability in Hong Kong? First, we can try to encourage the emergence of strong and democratic institutions, which I have advocated during visits to Hong Kong and in this House for many years—even before the signing of the Sino-British agreement. Unfortunately, successive British Governments have been guilty of dragging their feet on that issue and have been content to continue governing Hong Kong in the style of a colonial dictatorship.

I hope that the House will welcome the Select Committee's proposals for the Legislative Council—that 50 per cent. of the council should be directly elected by 1991 and 100 per cent. by 1995, and that the chief executive should be elected by universal suffrage as soon as possible. In the Select Committee I said that I should have preferred the latter election to take place at least six months before 1997. At least the Committee has gone some way towards meeting that point, although I accept the doubts of my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman) about whether an electoral college would be the best way to proceed.

At this point I part company with most other members of the Select Committee, because I believe that the second way to help to restore confidence and allay the fears of the Hong Kong people is to give the right of abode in this country to all British dependent territory citizens. I argued that point, too, in Committee, and I tabled an amendment which unfortunately was supported by only one other Member—my hon. Friend the Member for Doncaster, North (Mr. Welsh).

Bearing in mind what the right hon. Gentleman who chairs the Select Committee has said, is it not ironic that the Portuguese Government have granted the people of Macao a right of abode which in effect will give them the right not just to enter Portugal but to enter other European Community countries and to seek work in those countries, including the United Kingdom, yet the United Kingdom will exclude British passport holders in Hong Kong from that same and equal right?

It is also less than even handed on the part of the Government to have given special priority treatment to the Falkland Islanders, but to deny similar treatment to the people of Hong Kong. It is also worth bearing in mind that there are literally millions of people scattered throughout the globe who have the right of abode in this country, but who do not wish to exercise that right at present or in the immediate future. I can imagine, for example, the possible scenario in the event of a crisis in South Africa. It is estimated that 1 million white South Africans have the right of abode in this country. If a revolutionary situation emerged in South Africa, I am sure that the Government and Conservative Members would be bending over backwards to bring those people into this country. There would, probably, not be a whimper of protest from them and their supporters.

It is also indulging in scaremongering to conjure a vision of 3 million, 3½ or 4 million people from Hong Kong suddenly appearing on our doorstep. It is most unlikely, even in an Armageddon situation, that they would all want to come to the United Kingdom. Even the Government have hinted that, if the worst comes to the worst, they would try to initiate some international response. Obviously, by 1997 there will be the opportunity for members of the European Community, with a population of about 240 million, and other immigrant-receiving countries such as Canada, Australia and the United States of America, to offer a generous response. If, however, a large number of Hong Kong people came here, their entrepreneurial and other skills would be an added asset to the economic and social wellbeing of this country.

Unfortunately, the Foreign Secretary is not present in the Chamber. In a recent BBC television programme called, "Hong Kong—A Matter of Honour", when pressed by the interviewer, he seemed to indicate that part or—perhaps—the whole reason for not giving the right of abode to those people was that it would "exacerbate ethnic tensions". There are perhaps shades of Enoch Powell there. I hope that hon. Members on both sides of the House would deplore any discrimination on ethnic grounds. Certainly, British public opinion seems to be more progressive than British governmental opinion in that respect. An opinion poll in the same television programme, which has been confirmed by subsequent opinion polls in the quality press, showed that the majority of the British people would be in favour of granting the right of abode.

If the right of abode were granted, what would be the likely effect in Hong Kong? Some people have said that it would lead to depopulation or even mass exodus. In fact, there is a partial brain drain in Hong Kong already, because people do not have the right of abode in the United Kingdom. Many skilled people, such as the managerial classes, are going to countries such as Australia, Canada and the United States for a period so as to qualify for the right of abode in those countries. Therefore, Hong Kong, temporarily at least, is being deprived of skills. More of those skilled people would stay in Hong Kong if they had the insurance policy of the right of abode in this country.

What would be the effect on the Government of the People's Republic of China if the right of abode in the United Kingdom were given to the people of Hong Kong? The Secretary of State referred to the self-interest of the People's Republic of China regarding Hong Kong. I maintain that if we gave the right of abode to the people of Hong Kong it would act as a disincentive to the People's Republic of China to intervene in the internal affairs of Hong Kong. Currently, many people in Hong Kong have nowhere else to go, which might be a temptation to the People's Republic of China to intervene. Paradoxically, if people had the freedom to go elsewhere, China would be more likely to behave in a reasonable manner because the last thing that it wants is a mass exodus. If that happened, it would simply inherit a desert instead of a country with an economic future.

The right of abode would therefore be a disincentive to the People's Republic of China to intervene and to breach the Joint Declaration. It would also be a positive incentive to the people of Hong Kong to stay in Hong Kong, to build their future there and to have a stable, peaceful and fruitful relationship with the rest of China, with Britain and with the rest of the world.

7.10 pm

Sir .Julian Ridsdale (Harwich)

The Foreign Secretary, in his excellent and wise speech, said that the Joint Declaration of 1984 was a triumph of diplomacy. Yes, it was, but, in my right hon. and learned Friend's modest way, he did not speak of the great part that he played in that triumph. We should be grateful to him not only for his experience, but for the part that he played in negotiating the 1984 agreement. We should also be grateful to my right hon. and learned Friend for his recent visit to Hong Kong. In the face of great difficulty, he resisted giving way to some demands that would have been extremely difficult to meet.

My right hon. and learned Friend said that it was important that we get deeds as well as words from China, which would be a clear message of assurance to the Hong Kong people, and that he hoped that that would happen as soon as possible. That is what we should aim to achieve. I know the tragedy of what happened in Tiananmen square—I know that square well, as I have visited it on many occasions. Over and above the tragedies that occurred, however, it is in the interests of Asia and in the interests of all of us that we get such an assurance from China as soon as possible.

Yes, the Joint Declaration of 1984, which is now seriously jeopardised, had international support and good will. All that was undermined by the happenings in Tiananmen square. I understand the deep anxiety felt by the Hong Kong citizens. I served there as a soldier at the outbreak of the 1939 war and I experienced the loyalty to the Crown given by its people. That loyalty was also expressed during the war and during the Falklands war. I appreciate the need for prompt action to restore confidence; otherwise the unique position of Hong Kong as a financial centre could be seriously harmed before 1997.

As the Foreign Secretary said, our problem now is to stop the exodus of essential personnel and the international community must also play its part. It is in our interests, in China's interests, and, in this independent, global world, in everyone's interest that we have international support. If we do, we will have a greater chance of keeping Hong Kong as a thriving financial centre, to the benefit not only of China but of the world. That is why I was glad that the Foreign Secretary underlined that that was one of the important questions that would be discussed at the summit meetings. That is the perfect opportunity for such a discussion and we are fortunate to have it.

I have visited China a number of times, but the visits I recall most are those that I made in 1979, 1987 and 1988. In 1987, I led an all-party delegation and I was fortunate enough to have the hon. Member for Warley, East (Mr. Faulds) as a member of that delegation. I understood the strong feelings he expressed when he made a statement to the House about the Chinese Government. When I visited China in 1979, I thought the conditions were austere, but the hon. Member for Warley, East told me that I should have been there a few years before, when things were much worse and contact even more difficult.

What a difference it was when we visited in 1987. There was investment in industry, and new hotels were being erected. I visited Peking and Shanghai and, in comparison to 1979, China had almost doubled her standard of living. I also met members of the People's Liberation Army. I was fortunate enough to take my young grandson aged 14 as a travelling companion. I can vividly recall the great reception we were given and how the Chinese Minister for Education sat him down on a couch and said that he could give my grandson a bird's eye view of China in 15 minutes.

When I visited China in 1988, even more change was taking place. There had been great economic progress, but it was noticeable that the Government were encountering difficulties, because at the same time as expansion had taken place, inflation was also rising.

I am sure that President Nixon, in his excellent article in The Sunday Times, was right when he said that we must keep our presence in China behind the wall. I had to deal with Japan when it was controlled by a military power. Where there are extremists, it is important to try to support liberals and others. One must not lose contact with such regimes, but one must also realise that one is not dealing with the same type of regime as is found in Europe; one is dealing with an establishment, not a democratic regime. We are fortunate that President Bush is at the summit, as he understands China so well. He was a China hand. He is a moderate, and he will understand only too well some of the difficulties that we face.

Despite the difficulties and the drama of recent months, we must keep in contact with China. It is easy to get political applause by saying that the events of recent months were horrific. They certainly were, but a friend of mine, a distinguished China hand, told me that such things had happened in China in the past 30 years. He said that there had been four or five such incidents in the past, but that modern communication had made democracy difficult for China. Modern communication has brought such events home. Therefore, we must ensure that we have the confidence to overcome the difficulties.

What a difference it is for me to consider Asia today, with the Pacific rim producing 40 per cent. of the world's gross national product, compared with the Asia of 50 years ago when I visited Hong Kong for the first time. I knew then that war was ahead of us and that, for Asia, disaster lay ahead. We have overcome those difficulties and the difficulties that we face now are much easier than those of the past.

I hope that we shall try to speed contacts with the Chinese Government, who are by no means all extremists. If we can do that, we shall achieve what my hon. and right hon. and learned Friend advocated. He is right to say that it is important that we get deeds as well as words from China, and that a clear message of assurance is given to the Hong Kong people as soon as possible. I hope that that happens, as it will be in the interests of China, Hong Kong, this nation and the world.

7.19 pm

Dr. David Owen (Plymouth, Devonport)

During the past few weeks the Foreign Secretary has been under attack over his handling of Hong Kong. It is not easy, at any time, to be Foreign Secretary, but he has conducted this difficult task with immense skill, patience and courage.

In the short time that I have I shall concentrate on our responsibilities which are clearly to maintain the prosperity and stability of Hong Kong up to and beyond 1997. When discussing this with the People's Republic of China, we are entitled to remind those people that when we entered into the 1984 agreement it related to them as well as to the people of Hong Kong.

When the British Government say to the Chinese Government, "We need to take these actions to retain that prosperity and stability" they must be prepared to listen to us because we all know that Hong Kong is immensely fragile and has always been so. Its confidence can dissipate very quickly. I well remember when there was a near-mutiny in the police forces in Hong Kong in October 1977. It was a very difficult situation and the quite exceptional governor at the time, the then Sir Murray MacLehose, who now sits in another place, argued strongly for a partial amnesty to be given to a large number of people who had all the appearance of being guilty. I was extremely dubious about his proposal and took a lot of persuading, but he was right. The partial amnesty restored confidence in Hong Kong and taught me a major lesson: we cannot apply to Hong Kong some of the standards of fairness and equity that we would normally apply to the governance of the United Kingdom.

How we restore confidence and our handling of the Select Committee report will be crucial. The Select Committee rightly said that the Government must exercise discretionary power to give some people right of entry into the United Kingdom as a confidence-building measure so that they will continue to contribute to the prosperity and stability of Hong Kong. I agree with the Chairman of the Select Committee that it will be immensely difficult to exercise that judgment. I do not like the expression "categorisation". How we exercise that discretion will be extremely difficult to justify to the House and Hong Kong. Frankly, it can be done only by the governor, who holds the necessary powers. He can directly advise the British Government and, through them, the Foreign Secretary and the Home Secretary. The governor must be given considerable discretionary power and, if necessary, we shall have to legislate for this.

The pace at which we make those discretionary judgments will depend on the most critical factor of all: the response of Peking. Perhaps we have not had enough discussion of the central importance of China in the restoration of confidence in Hong Kong. A few well-judged sentences, phrases and actions from Peking over the next few months could contribute more to the restoration of confidence than anything we do, even—begging his pardon—granting the right of abode of which the right hon. Member for Yeovil (Mr. Ashdown) spoke.

We must be careful about using words such as "shabby" and "grubby" in this context. These are very difficult issues and, in my experience, the more politicians talk about morality, the more they lose touch with reality. We face very hard choices. We may have to be far more generous in giving Hong Kong citizens the right of entry over the next few years than any of us realises. We should not take too rigid a stance. If the position were to deteriorate considerably in China, we would have to be more generous and maintain the confidence of many more people in Hong Kong than we shall over the next few months.

I openly admit that I have no greater wisdom than any other hon. Member on this issue, but I believe that China will not revert to the cultural revolution. I do not believe that the Chinese Government will decide to forgo the substantial reforms that flowed from the third plenum in 1978. Modernisation of the economy will still be a major thrust of Chinese policy.

We should also remind ourselves that the third plenum made another decision: to give priority to economic modernisation and political stability. When we criticise Deng Xiaoping we should remember that, in his experience, students were not always the fount of all wisdom in China. There is an intense fear of instability in China.

That is no excuse for the massacre, which was almost beyond words to describe. The western world, Asia and, far more importantly, the people of China will not forget what happened in Tiananmen square. However, because what happened was wrong, it does not necessarily follow that a sequel of events in China will turn back the clock on the economic reforms.

It has always been clear that, unlike the leadership of the Soviet Union, the Chinese leadership is not aiming for serious glasnost or democratic reform, which I regret because I believe that it should. Violence, and the acceptability of violent behaviour, in China is not new. What the Chinese have been doing in Tibet over the past few years and months is little short of appalling in terms of human rights. Their support for Pol Pot in Cambodia was equally outrageous. We knew that when we negotiated the agreement in 1984. We took a judgment and hoped that the economic advantages of maintaining Hong Kong would be sufficient to justify it, but they may not be. If that is not so, the House will have to respond, as it responded to Uganda. We could not predict what was going to happen and, faced with General Amin, there was a humanitarian necessity for us to respond. That may be the case with China, although I wish that there was less talk of Armageddon and an horrendous future, which could prove to be a self-fulfilling prophecy, and a little more cautious belief that the changes that started in China in 1978 will not be reversed and that Hong Kong is an essential part of maintaining that economic modernisation.

Apart from his far too limited view about how we should use the flexibility of right of entry, the right hon. Member for Old Bexley and Sidcup (Mr. Heath) spoke many wise words with which I agree—particularly his point about patience. We shall return to the issue of Hong Kong many times in the next eight years, and perhaps quite a few times in the next year, when the situation will be fraught. All that I beg of the House is to be confident in the Foreign Secretary's capacity to handle this matter. There will be a difficult judgment to make on the trade mission. I hope the Foreign Secretary meets his Chinese counterpart as soon as is humanly possible, certainly at the United Nations in September and, arguably, before.

We must weigh carefully the issue of how to handle economic and trade matters. The Government are right not to have applied economic sanctions to China, and to have followed the rest of the world and the United States in holding off from doing so. At the economic summit, the fact that we have not applied sanctions can be used to explain to China that we shall see how it responds to Hong Kong as a litmus test for whether it will continue with economic modernisation and whether the world will help in its economic modernisation.

If we could obtain an expression of good will that, in the event of an Armageddon, there would be a world response, all well and good. I say to the Chairman of the Select Committee that it will be almost impossible to convince other Governments to make a commitment to accept the residents of other countries in advance of the holocaust. The most that we shall receive is a general expression of solidarity. The Chairman of the Select Committee is right to say that we shall see these forced migrations in many parts of the world for many different reasons and will have to learn how to respond to them internationally.

Confidence in Hong Kong is a fundamental issue. We can help to achieve this. It is not a matter of money. People in the public health service, education, social services, the transportation system, and the management of the stock exchange and commodity markets are all crucial to the economic prosperity and the social stability of Hong Kong. If it helps them to retain their jobs until 1997 and beyond, this country must be generous and give them that confidence.

7.29 pm

Mr. Julian Amery (Brighton, Pavilion)

Before I come to the main theme of our debate, I want to say a word about the boat people in Hong Kong. This is a painful and intractable problem, but, speaking for myself, I think that we must draw the line against forcible repatriation. We cannot accept that. Older Members will recall the forcible repatriation of the Cossacks and the Cherniks. No one would suggest that someone escaping across the Berlin wall should he sent back. At one human rights conference after another, our representatives speak of the right of emigration. If the newspapers are to be believed, we are proposing to give a per capita grant to Vietnam for every Vietnamese repatriated. We had much better spend the money getting them decent accommodation in Hong Kong or elsewhere until a more sensible solution to the problem can be found.

The growth of business ties with China, the fact that for many years it appeared to be almost an ally against Brezhnev's imperialism, and the spread of tourism, all fostered the illusion that the Chinese dragon had become the sleeping beauty—but it was always an illusion. I am probably the last British officer who served on Chiang Kai Shek's staff. I have no illusions about the brutality of his regime at times, and the Maoist-Communist revolution was more bloodstained even than the Leninist-Stalinist one. We should not be too surprised at what has happened. I was a little surprised that my right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath) said that he was stunned by what had happened. Perhaps he should have had a slightly less naive view of the situation.

There is undoubtedly widespread discontent in China. It manifested itself first in Tibet. It arose not only in Peking and Shanghai—it was also to be seen in many of the provincial towns. This was no little local difficulty. That much is made clear by the official propaganda which denounces the counter-revolutionary plot and, rather than trying to play down what has happened, tends, if anything, to build it up.

The regime was clearly scared, because there appears to have been a moment of fatal hesitation when it did not react. Had it reacted more quickly there might have been less bloodshed. But the Chinese Government were not sure what to do. Were there divisions in the party and in the army? In a curious way I was reminded of General de Gaulle flying to Baden when I heard that Deng Xiaoping had flown to Wuhan to see the generals and recall the veterans of the long march. Perhaps order has been restored—if so, it is under a fairly elderly and old-fashioned leadership.

I shall not attempt to prophesy that China will return to warlordism, but the country has a history of instability, not just in the old days but under the Communist regime—under Mao, Lin Xiao Xhi and all the others. What has caused this instability? I suppose it is the difficulty of reconciling economic progress and political stability. That has been exacerbated by external influences—by business connections and by students going abroad, but perhaps more importantly by the influence of Taiwan. I believe that there were more than 300,000 Taiwanese visitors to the mainland last year. Perhaps above all, there has been the influence of Hong Kong, with its free press and vocal political views.

When it comes to the crunch between promoting prosperity or retaining political power for the party, we have seen that the regime opts for retaining political power, even at some damage to the chances of prosperity. This is awkward for my right hon. and learned Friend the Foreign Secretary and for all of us, because the basic calculation on which the Anglo-Chinese arrangement was made was that it was manifestly in China's interest that Hong Kong should continue as a prosperous capitalist centre and that "one country, two systems" was obviously what the future of China required. However, when a regime opts in favour of retaining political power at the expense of promoting prosperity, it is no wonder the people in Hong Kong are anxious.

What can we do? Looking back, I sometimes wonder if we were right—I say "looking back" because I did not think this at the time—to surrender sovereignty as completely as we did. Of course, we could not have defended Hong Kong against attack, or even siege, but there might have been a Rubicon that Peking would have hesitated to cross.

I shall advance three suggestions of what we might do. They fit in well with what my right hon. and learned Friend the Foreign Secretary said, although perhaps I put them a little more brutally. We want an autonomous regime in Hong Kong of a kind which could continue after 1997. It must be equipped with its own security force, including perhaps a gendarmerie. Perhaps Hong Kong could even afford to employ some Gurkhas. The force should be of sufficient strength that any attempt to subvert Hong Kong from the inside, or to advance against it from the outside, would be visible to the whole world. There must be no Chinese army garrison inside Hong Kong, at any rate until the 50-year period is over. Beyond that, it is worth considering the interests of other countries in Hong Kong. The Germans, the Japanese and not least the Americans all have massive investments there. Could we not persuade them to underwrite the basic agreement that we have concluded with the Chinese Government? We hope, too—the right hon. Member for Plymouth, Devonport (Dr. Owen) said that there is reason to hope this—that the Chinese will return to the good sense that led them to make the agreement originally.

If we fail, we shall face the problem of the right of abode much more clearly than we do today. Much has been said about it. I hope that I shall not be thought wet or lacking in determination if I do not pronounce on it today. We have time. I should like to see how matters develop and what the Chinese Government do to restore confidence in Hong Kong. Only yesterday they tried to give reassurances, at the same time saying that Hong Kong must be careful not to become a nurse to anti-Communist propaganda. That was not reassuring.

Let us see how the situation develops. The problem is with us for a long time to come. It will return to the House of Commons and I hope that the Government will bring it back to the House when we meet again in the new Session after November.

7.38 pm

Mr. James Lamond (Oldham, Central and Royton)

I believe that we have a strong moral obligation to the people of Hong Kong. I think that every hon. Member realises that, but many are wriggling and trying to avoid facing up to it by making proposals which they think the people of Hong Kong should accept as a basis for future confidence in the behaviour of the Chinese People's Republic. It is very easy to lecture people in Hong Kong about how confident they should be, but it is revealing when we see the Foreign Secretary admitting on television that if he lived with his family in Hong Kong, he would be looking for an insurance policy.

Conservative Members who are so eager to suggest to the people of Hong Kong that they should have confidence should ask themselves how they react when they are asked to have confidence in the new regime in the Soviet Union and its policy of disarmament. Is there a ready acceptance of the new regime, confidence in it and attention to its words? Of course there is not. All we get is the cry of caution—nothing can be done until everything has been proved and every t crossed and every i dotted. Only then will they have confidence. However, the people of Hong Kong should have confidence in the face of what they saw on their televisions a month ago.

I base my case on morality. Ten minutes ago, the right hon. Member for Plymouth, Devonport (Dr. Owen), who has now left the Chamber, told us that when he hears politicians speak of morality, he thinks that they are departing from reality. When I hear people saying that we must face up to the reality of the situation, I feel that they are departing from morality, and morality is an extremely important part of a politician's make-up.

The people of Hong Kong must have a real basis for confidence. What better way to find out what they require than to ask them and to listen to what they say? Is there any doubt in anyone's mind about what would build the confidence of the people of Hong Kong? It is an extension of the right of abode in this country if they need it. I strongly support that. I advocate that it should be extended to them.

I know that that is contrary to my party's policy, but I believe that morally that is what should be done, and I will not justify it on the basis that perhaps only a few of them will come, so we need not worry about it. We have a moral responsibility, it should be faced up to and we should accept that we may have to meet it in full. If we have to do that, we shall have to ask the British people to make tremendous sacrifices. Are we so afraid of the morality of the British people that we cannot put that to them?

I represent a constituency in the north-west of England. What gives me most pride in that is something that I used as the theme of my maiden speech. It was the tremendous moral conduct of the textile workers in that area during the American civil war, when they refused to touch or work with the cotton brought here from the southern states, because they were against slavery. Because of their principles about what was happening in a country an ocean away, their children went hungry. Their houses were taken from them, but they did not flinch from that moral stance. I look back on that with the utmost pride.

I should like to think that, in the future, when people look back on this episode in history, they will not see that we tried to dodge our moral responsibility by saying, "Well, I am not sure that we have moral responsibilities," as the right hon. Member for Old Bexley and Sidcup (Mr. Heath) said. I was astounded by that. I would have thought that he, of all people, would accept this moral responsibility. If we do not face up to it, this will be a black chapter in our history, and the people who come after us will look back and say that we did a dishonourable act.

7.44 pm

Mr. James Couchman (Gillingham)

This country has a long and honourable record of providing a haven to those who are persecuted, subjugated or in other ways intimidated or discriminated against for reasons of race, religion, nationality, membership of a particular social group or political opinion. That is entirely proper, for such persecution or discrimination forms the kernel of the reasons for granting refugee status.

Three groups of such refugees can be instanced quite easily and serve to illustrate our record of compassion. The first group was the Huguenots, who fled Europe three centuries ago to escape religious persecution, the second the Jews who came from eastern Europe to escape racist and religious persecution. In recent years, as my right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath) said, came the third group—the Asians from East Africa who came here when those countries were Africanising their economies. Interestingly, those groups have generally prospered and made a considerable contribution to the country that gave them sanctuary.

Recently, we have played a large part in settling a substantial number of Vietnamese boat people. However, the people of Hong Kong do not qualify as political refugees, because they are not persecuted, subjugated or discriminated against. I do not believe that my right hon. and learned Friend the Secretary of State could grant right of entry or abode to the 3.25 million Hong Kong British citizens, either on the basis of political asylum, or under the discretion of the Home Secretary. Without doubt, he would be acting ultra vires.

Those of us who unequivocally supported the Joint Declaration in 1984 as a pragmatic, realistic and even elegant solution to the problem of how to secure the safety of the Hong Kong people beyond 1997 were encouraged in our support by the open door policy then being followed by China and by its new-found enthusiasm for strengthening its relationships with the rest of the world. We prayed that there would be no return to the madnesses of the cultural revolution, which would damage confidence in Hong Kong. In 1986, a number of my hon. Friends and I expressed concern at the creation of the British national (overseas) status, but we voted for it and kept our fingers crossed that China would maintain its progress towards modernisation and improving international relationships.

Earlier this year, before the flowering of the pro-democracy movement in China, reports of diminishing confidence in the Joint Declaration in Hong Kong reached us. However, we were inclined to dismiss such reports as a sign of Hong Kong volatility. Now, after the ghastly events of 3 and 4 June, confidence in Hong Kong is shattered and the demands for right of abode have risen to a crescendo. To grant such right of abode to all those who might claim it would, as I said earlier, be ultra vires.

What can we do to restore confidence? I am much attracted by the search of my right hon. Friend the Member for Guildford (Mr. Howell) for an international solution, with assurance given in advance by a number of nations. As my right hon. Friend said, it might be necessary for those international assurances to be honoured in circumstances well short of the Armageddon scenario, and perhaps before 1 July 1997, if events in China become so alarming that confidence in the Joint Declaration breaks down completely. In any case, if the agreement breaks down beyond 1997, it is most unlikely that the People's Republic of China will allow the Hong Kong people to leave, and a new and terrifying armada of small boats will take to the seas with a new boat people.

If such an eventuality came to pass, so that that international assurance had to be honoured, it is without doubt that Britain would need to give a substantial lead, taking a large proportion of those who wished to leave. Should we regard this with fear, or should we welcome the prospect of an influx of skilful and hard-working people who might help to bridge the shortage of modern skills that confronts industry, particularly when our pool of young and entrant labour diminishes as dramatically as it will do? Perhaps we should encourage a greater number of Hong Kong people to bring their skills and energies to this country, not as refugees from an Armageddon situation but through an orderly influx over a period of time.

As my right hon. Friend the Member for Guildford made clear in his statesmanlike and persuasive speech, if we wait for Armageddon, the skilled and the entrepreneurial will have long since left Hong Kong and gone to the States, Canada, Australia or almost anywhere but the United Kingdom. We will need to offer entry under circumstances well short of catastrophe in return for a commitment to stay in Hong Kong until 1997 or until such time as international opinion believes that circumstances in China have deteriorated to the point where international agreements and assurances are triggered.

It may be necessary to change the present law to enable us to give such an assurance to the Hong Kong people. So be it; that will be the price of maintaining our international integrity. As others wiser than 1 have said, there is no doubt that the international community looks to us for a lead in the matter of Hong Kong, and we must not disappoint them.

7.50 pm

Mr. Jim Sillars (Glasgow, Govan)

I was not in the House during the period leading up to and following the signing of the joint agreement with China, but I have taken the trouble to read extensively the debates and statements of the past 10 years. The picture that appeared was of the Government and the Opposition engaged in an orgy of self-congratulation; complacency abounded; the best of all possible solutions had been found. That is the message that strikes the reader of the records.

While it was acknowledged that the people of Hong Kong had no real choice but to accept the agreement concluded between the United Kingdom and China, the underlying theme was that a sophisticated and skilled United Kingdom team had obtained a good deal from a Chinese Government undergoing a profound change and a Chinese Communist party which no longer held the view that the only power worth exercising was that which came from the barrel of a gun. The skill of the United Kingdom, the deep changes within the ruling groups of China, and the text of the agreement were supposed, in themselves, to provide the foundation upon which the people of Hong Kong could place faith and reliance and maintain their sense of security and confidence in the future. What we have in fact, long before the fateful date of 1997, is a manifest failure of that agreement to maintain the Hong Kong people's sense of security and confidence and I am not surprised.

When the United Kingdom Government entered into negotiations, they made a monumental error of judgment about the nature and character of the Chinese Communist party. The Government suspended their critical faculties. The party that had created the human misery associated with the great leap forward, the blooming and then the cutting down of intellectuals, and the disaster of the cultural revolution, was accepted at face value when it claimed to have changed beyond recognition. Our Government and Opposition did not have the ability to look below the surface of the slogan, "Socialism with a Chinese face" to see that it represented only a disguise. What the Hong Kong people got from the British contribution to their fate was not a sophisticated analysis of the Chinese Communist party and its workings and internal tensions, but an overdose of naivety. The British missed altogether the sort of evidence then available—which was quoted on page 146 of the minutes of evidence to the Select Committee on 20 April—from a group called "1997 Concerns."

Deng Xiaoping said in 1988: don't think that all of Hong Kong's affairs will be managed by Hong Kong, with the central government sitting idly by, and everything will be just fine. This is not acceptable. This type of attitude is not practical.… Can you imagine that there will be no obstructions or destructive forces in Hong Kong? I see no grounds for such self consolation. Against that hard-headed dose of realpolitik, the Hong Kong people got naivety. The Foreign Secretary conjured up visions of passing on Hong Kong, like a precious Ming vase, to his Chinese team mates, as he described them.

The Opposition spokesman, the hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes), said: Secondly, we should acknowledge the essence of the joint declaration that, from 1 July 1997, the People's Republic of China will be sovereign. Some hon. Members have said that that means that the Chinese Government can do anything they wish, but, as others have said, there are constraints on them. Our responsibility is to secure all the safeguards that we can, realise their limitations … and ensure that the Basic Law corresponds as much as possible with the spirit and letter of the joint declaration. After that it is a matter of trust. In Beijing, the Government of the People's Republic of China described their signature of the joint declaration as a solemn commitment. I accept their sincerity—much more than I do that of the present British Government on a number of issues."—[Official Report, 15 July 1988; Vol. 137, c. 754.] Whatever one might say about the Thatcher Government, we have not yet had tanks and machine guns in the streets.

The hon. Gentleman spoke those words in this Chamber only one year ago. None is so blind and deaf as he who does not wish to see or hear.

The truth is now emerging. Far from the cosy, cordial, open relationship where trust could be assumed, the Foreign Secretary said to the Select Committee on 14 June, at page 351 of the minutes of evidence: Everything one says about China, even in communications as open as they were before the atrocious events of a couple of weeks ago, is less than perfect; one is looking through a thousand glasses darkly. Bearing in mind his previous statement about Hong Kong being like a precious Ming vase passed from hand to hand, we wonder at his choice of metaphor when he now tells us that it was never easy to see the other side to which we are handing the vase.

Let us consider the reality faced by the people of Hong Kong, over whom we have absolute power and for whom we have absolute responsibility now and until 1997. There is to be a transfer of territory. There is to be, uniquely, a transfer of people against their will. The territory and the people will be placed under Chinese sovereignty. The Chinese have promised not to derogate sovereignty, but to exercise it within an agreed framework of autonomy, which they will set up in consultation with the people of Hong Kong but with the final version resting with them as the sovereign power. Britain will issue people in Hong Kong with passports purporting to give them a form of British nationality, but without the benefits of a real national. In fact, those passports will offer no British protective cover in Hong Kong.

It is an unenforceable agreement. I stand open to correction, but I am certain that China's arrangement for the International Court of Justice to have jurisdiction over certain matters will not cover a breach of the agreement. Even if I am not correct in that, we all know that in recent cases, such as the United States against Nicaragua, and Iran against the United States on the issue of hostages, the ICJ had no remedies because it had no sanctions to apply. The much-vaunted Joint Declaration cannot be enforced by Britain, but it can be broken by the Chinese. People say that the Chinese keep their agreements. They might keep their external agreements but, as Tibet has shown, they do not keep their internal agreements when they have sovereignty.

The unenforceable agreement makes the Hong Kong Chinese people hostages to fortune. The Government and the Opposition have tenaciously clung to the idea that those people cannot have the right of abode in the United Kingdom. The Foreign Secretary has said that there are many problems. We accept that there are practical problems, but they are mostly about resource pressure on important social services. There is a practical way out of that practical problem. We should give the right of abode and simultaneoulsy establish a Hong Kong investment fund, similar in character and objectives to the Kuwaiti investment fund, which has grown enormously over the years, to create a capitial resource which would allow us, in the event of Armageddon, to go to the British people and international community and suggest that they take not just the people of Hong Kong but the help of the capital resources to overcome the practical problems that have been described. If we do not give the people of Hong Kong the right of abode, we shall do them a great evil.

8 pm

Sir Peter Blaker (Blackpool, South)

I am glad to see the right hon. Member for Yeovil (Mr. Ashdown) in his place because I wish to refer to his claim that Parliament shrugs its shoulders at Hong Kong. That that is not true has been shown by this deeply serious debate in which hon. Members have shown much concern. It would be a great pity if the message that we do not care were to go to the people of Hong Kong. The message that we want to send to them is that we understand the anguish and trauma that they feel as a result of the massacre in Tiananmen square and we understand why they feel that way.

In return, I ask something of them. One sometimes sees reports of the questioning in Hong Kong of British motivation in relation to Hong Kong. It is alleged that the British Government, indeed the British Parliament, attach more importance to increasing British trade with China than to securing a good future for Hong Kong. Having had some experience as a Minister responsible for Hong Kong, and having followed the subject all my political career—indeed I was born there and have followed it all my life—I can confirm with great confidence that that allegation is untrue. The motivation of this Government, as of previous Governments, has been to secure the best possible future for Hong Kong. Not only is the allegation untrue; it is a deeply unwise allegation for anyone in Hong Kong to make. It results in a self-inflicted wound because it damages confidence inside Hong Kong.

If one were to consider the matter on a purely commercial basis—which I am not—and examined the difference in trade between Britain and China and Britain and Hong Kong, it would be seen that we sell to China less than half what we sell to Hong Kong. On a commercial basis, it would be folly if the British Government sought to improve our trade with China at the expense of Hong Kong.

The restoration of confidence in Hong Kong is one of the most difficult questions that we have had to face in our overseas deliberations for some time. The issue of right of abode is extremely difficult. I have to say to my friends in Hong Kong that the right of abode on the basis that they are seeking it is unattainable. Parliament simply would not pass the legislation required to give them what they have been asking for. The British people would not understand if it were proposed by the Government. That is a sober analysis of the position as I see it. Almost nobody in the House believes that we could do it. Almost nobody outside the House believes that we should do it. That is not because of any hostility towards the people of Hong Kong, for whom the many of us who know them have a deep respect. They are energetic, creative and active people. It is simply because of the sensitivity in Britain about the problem of immigration, resulting from the events of the past 30 years or more, and because of the sheer numbers that are being discussed. I hope that the Government will succeed in finding a satisfactory flexible solution, but I fear it must fall far short of what the people of Hong Kong have been asking for.

A point that has been implicit in many speeches is that the disadvantage of the present system, which allows people to go from Hong Kong to Britain—although not many come—Australia, Canada and the United States is that to establish residence rights or citizenship they have to live in the country of their choice. That is bad for Hong Kong because it loses some of its best people. I hope that in seeking a flexible solution the Government will bear that in mind.

The Government are right to consult other countries of good will on assurances that could be given so that the people of Hong Kong might have the prospect of moving elsewhere in the event of what my right hon. and learned Friend the Foreign Secretary described as a fundamental and overwhelming violation of the Joint Declaration.

Let me deal now with the prospects for faster direct elections in Hong Kong. I have said from the beginning that the second draft of the Basic Law was wrong in that respect. It was much too slow. The erection of a hurdle in the form of a referendum was a serious mistake.

It is important that the people of Hong Kong should arrive at a consensus on that question. The consensus of 24 May produced by OMELCO was an important step forward. I would go so far as to say that simply achieving another consensus may be more important than precisely what the consensus is, because it would be a powerful factor in the minds of the members of the Basic Law drafting committee.

On the question of the Vietnamese boat people, there should be an understanding that mandatory repatriation is right in the case of economic migrants. I am glad to say that the position is supported by the Save the Children Fund, so I am not speaking as somebody who has no compassion. We must obtain assurances from Vietnam that there will be no victimisation. Arrangements must exist which will give confidence that those assurances will be observed. However, I find the attitude of the United States Government and Congress on that matter incomprehensible and illogical. I hope that my right hon. and learned Friend the Foreign Secretary will make it clear to the Americans that that is the view of many hon. Members.

The United States says that the people now coming to Hong Kong are, for the most part, economic migrants and so do not qualify for resettlement in the United States. But it stops short at the point when it should go on. It should say that it is permissible and correct to repatriate them, as other economic migrants who have come without the benefit of visas are repatriated all over the world. They are certainly repatriated if they cross the Mexican border with the United States. Those economic migrants who come from Haiti in boats are sent straight back when they land on the coast of Florida. I hope that my hon. Friend the Under-Secretary of State will pursue that matter.

I am confident that by 1997 the future of Hong Kong will be that described in the Joint Declaration. We are familiar with the arguments about China's self-interest. China's economic self-interest is even stronger now than it was two or three months ago because it has severely damaged its economy by the events of Tiananmen square. Equally, the Taiwan factor is as strong as it has been for so many years.

I want to say something about an argument for history. It has never been true that freedom in Hong Kong has depended on democracy in China. There has been no democracy in China at any time that I can think of, certainly not in the past 148 years. The concept of "one country, two systems" is based on the assumption that China is likely to remain Communist. That is what it is all about. Therefore, we need not imagine that it is essential that China should be democratic for Hong Kong to have confidence in the future.

During all the turmoil of the past eighty years—the civil war, the arrival of Mao Tse-Tung at the border of Hong Kong in 1949 when no one knew whether he would stop or carry on into Hong Kong, the Korean war when Britain was at war with China, the United Nations trade embargo during the Korean war, the great leap forward, the cultural revolution and the Red Guards—during all that time China has not laid a finger on Hong Kong. In 1967, when the local Hong Kong Communists thought they could take the place over by a campaign of bombing and rioting, Peking positively discouraged them.

In all that time, Hong Kong was governed by "unequal" treaties—so described by China. Now that there is the "equal" treaty of 1984, why should we imagine that China is more likely to cut its own economic throat than it was during those 80 years?

We must remember that Hong Kong has come through times equally as alarming as the present, if not more so. If confidence is preserved, Hong Kong can come through this crisis, too. We have an obligation to do everything that we can to help preserve confidence. I ask the people of Hong Kong, as an act of will, to be confident. There is some will power involved, and it is for the people of Hong Kong to decide that they will keep their chins up.

The country that is best placed to help to restore confidence in Hong Kong is China itself, and it has much to gain from doing so. Recently, China reaffirmed the "one country, two system" concept. What we need now from China are practical steps and deeds, as well as more words of confidence.

8.10 pm

Mr. Peter Shore (Bethnal Green and Stepney)

The events that occurred in Peking on 4 June overshadow our debate and hang like a black cloud over the people of Hong Kong, but while those events remain firmly in our minds, we must take the longer perspective and try to place them in the context of the Joint Declaration signed in 1984, the transfer of sovereignty in 1997, and the 50-year treaty which will then come into force.

I agree with the right hon. Member for Yeovil (Mr. Ashdown) that there is a unique aspect to the Hong Kong problem. Unlike all other former British colonies, the goal of independence that we have faithfully pursued across the globe for the past 40 years, since 1947, is not available to the people of Hong Kong because the lease on the new territories expires in 1997 and because China has never recognised the unequal treaties under which Hong Kong island and Kowloon were ceded in the 1840s. The result of the 1984 negotiations and the debates in the House that followed them was not independence but a treaty which guaranteed virtually total autonomy to Hong Kong for a 50-year period on the basis of the "one country, two-systems" formula.

I do not agree with the statement of the right hon. Member for Yeovil that Parliament handed over the people of Hong Kong naked to the tyranny of a Communist country. That is not so at all, and such an assertion flies in the face of everything that we set out to achieve and, indeed, accomplished. Right hon. and hon. Members in all parts of the House agreed that we should maintain for the people of Hong Kong substantial and almost total autonomy under one of the most remarkable treaties ever signed. That treaty granted the continuation of a separate economic system in Hong Kong. Even more important, it secured the continuity of Hong Kong's laws, system of justice, and independent legislature, based on Hong Kong itself.

One of our major concerns must be to ensure that the autonomy embodied in the Joint Declaration is fully translated into the precise language of the Basic Law, which is still in draft form. Weeks before the events in Tiananmen square, I reached the conclusion—as, I suspect, did many other right hon. and hon. Members—that the present draft of the Basic Law is inadequate and needs to incorporate stronger guarantees against any possible Chinese intervention based on the legalities of the Basic Law. It also needs to enact a Bill of Rights.

Above all, the Basic Law must provide for Hong Kong's legislature to be directly elected before 1997. That is why we and the Select Committee reject in terms the doctrine of mirror imaging, whereby the Hong Kong Administration and the British Government pretended to make proposals about democracy in particular only in so far as they thought that those proposals coincided with the intentions of the Chinese Government. We called for the people of Hong Kong themselves to determine the nature, extent and timetable for introducing democracy before 1997.

The crucial additional question that the Select Committee faced, and which now confronts the House, is whether, after the events of 4 June, the Chinese Government can still be trusted. Will they renege on their commitments? Will they tear up the treaty? Will they impose their authoritarian rule on Hong Kong? My view still is that they will do none of those things. That view is not based on any optimistic appraisal of the character of China's present Government. It is suggested by the immense blow to China's interests that would be struck if they were to violate the Hong Kong treaty.

Hong Kong is immensely important to China's economy. It is like a powerful tugboat, pulling the great liner of continental China towards greater economic growth and prosperity. It would be madness for the Chinese Government to tear up an agreement that guarantees continuity of Hong Kong's prosperity and progress. Perhaps the ultimate guarantee for Hong Kong is that if China tore up the treaty it would put paid for ever to the Chinese Government's cherished hopes of ultimately seeing the reincorporation of Taiwan into China.

What if, despite all those considerations, a disaster occurred? I have wrestled with my conscience, as I am sure other right hon. and hon. Members have done with theirs, as to the extent of our obligation. There must have been many occasions in the past when we have launched a new nation into independence knowing very well that there could be no guarantee that after independence that nation would be safe either from internal tyranny or from external aggression, but on no previous occasion have we felt that our obligation to a former colony extended to offering a right of abode in Britain to all its inhabitants in the event of a disaster. Therefore, it is not reasonable to expect Britain to extend such a guarantee to Hong Kong now.

Any individual who is threatened or who has reason to fear persecution because of his political views should, of course, make use of our open-door policy. However, we have accepted that there is a difference between the granting of independence and the granting of autonomy, however strong we believe the treaty guaranteeing that autonomy to be. That is why the Select Committee called for Britain to take the lead in organising an international safety net if, after 1997, China tears up the 1984 treaty. For Britain alone to give such a guarantee would be unconvincing to Hong Kong and unacceptable to the bulk of our own people. If the burden can be shared with Canada, Australia, the United States and the European Community, it will provide a much broader base on which a refuge of last resort can he based. I hope that the Foreign Secretary will, as he has promised, enter into an early and serious dialogue with all our partners in helping to provide the safety underpinning that Hong Kong needs.

8.19 pm

Mr. Robert Adley (Christchurch)

The events of 4 June in Peking were undoubtedly significant for the history of China, both internally and externally. The first and most obvious point to make is that they illustrated, graphically and horrifically, the concern felt by many outside observers about the disparity between the movement towards economic liberalisation and the lack of movement towards political liberalisation. It would be immodest of me to refer to comments that I made in a book that I wrote in 1984 called "All Change in Hong Kong", but I do not think that I was alone in recognising the dangers that China faced. What we are now discussing is the effect of what seemed to many an inevitable crisis, and what that effect will be on the people of Hong Kong.

Hon. Members are normally required, at the beginning of speeches, to declare any interest that they may have. I suppose that my chairmanship of the British-Chinese parliamentary group could be construed as a political interest; in any event, for those of us who, like my right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath) and many others in the House, have watched with interest the development of politics in China during the past few years, to see China knock itself off the pedestal on which we have placed it has been a cause of grave concern.

I refer not to the Chinese Government but to the Chinese people when I say that our succour and support are needed at this time. Whatever we may fear for the future of the people of Hong Kong, 1 feel that we should spare—in spades—a thought for that of the Chinese, living as they do under a Government who are prepared to resort to shooting their own unarmed citizens. The Chinese Government have lost not only their credibility throughout the world, but their credibility among their own people.

I allow myself only a minor jest when I recall that, over the past few years, I have had the pleasure of showing Mr. Hu Yaobang and Mr. Zhao Ziyang round this building and chairing meetings with them, only to find subsequently that they had been disgraced. Perhaps the House should invite Li Peng to pay us a visit: he might share their fate. There can be few people who are more unpopular in China at present.

Our debate has highlighted the difference between those with political responsibility—or the expectation of it—and those who have been willing to exercise their moral judgment without, perhaps, contemplating the effect of such a luxury on opinion in both Hong Kong and Peking. I implore hon. Members on both sides of the House to remember that, although the words we speak here are being spoken in a debating Chamber, they may have more of an impact on people living on the other side of the world than we are accustomed to expect of our speeches. Our criticisms of the Chinese Government should be objective; our actions—if there is any point in saying such a thing—should be designed to help the process of change in China, rather than to help ourselves to clear our consciences with breast-beating. That is of no use to the people of China who are suffering now.

Our message to the Chinese Government should perhaps be this: that they should understand that we understand that, on the one hand, overt external criticism is likely to be counter-productive, but, on the other hand, we appreciate their need for western technology. Perhaps the most useful action that the House can take is to allow them to contemplate how they will set the balance between what we say to them and what they need from us.

A number of hon. Members have mentioned the paramount need for China to ensure that Hong Kong remains prosperous and stable; the point does not need to be laboured. It is, however, the key to Hong Kong's future. The only certain way in which to undermine that stability and prosperity is to destroy Hong Kong's value to China: that was the purport of my intervention in the speech of the right hon. Member for Yeovil (Mr. Ashdown). Sadly, some people in Hong Kong seem to aim unerringly in that direction, and I do not believe that they serve the real interests of the people of Hong Kong.

China's role in Hong Kong's future is not a matter of debate: it is a matter of fact. The 1984 Joint Declaration was and remains the only basis on which Hong Kong has any prospect of maintaining its stability and prosperity. Words such as "obligation" and "honour" may be used, but 1997 has always been in prospect. If I move into a house with a finite lease, my options will be limited when that lease ends: I can only hope that the leaseholder can negotiate my continued occupancy with the freeholder. That is the role that the British Government have seen themselves trying to play, and the role that, so far, they have been able to play. If we dare to send a message to the people of Hong Kong, let it be that, if it is necessary to live with a giant, sticking pins through his ankle may not be the best way of reaching an accommodation with him.

Talk of renegotiating the Joint Declaration strikes me as unhelpful; whether we can improve the Basic Law through negotiation is an altogether different matter, but our probes must be constructed within the realistic bounds of China's bottom line— that is, the maintenance or re-establishment of sovereignty after 1997. Demanding of the Chinese that they do not station the People's Liberation Army in the territory must, in my view, seriously impinge on the sovereignty issue, and 1 find it hard to believe that they would be prepared to allow any such clause to be negotiated into any agreement.

It is fashionable in certain quarters in Hong Kong, and even in this country, to impugn or deride the integrity of my right hon. and learned Friend the Foreign Secretary. That, I think, both insults the man and assaults an intelligent assessment of the situation, and those in Hong Kong who are leading the verbal attacks on my right hon. and learned Friend demean only themselves.

The 1989 scenario, as I have said, has always been there. June 1989 has created a climate of wholly understandable fear in Hong Kong. My right hon. Friend the Member for Blackpool, South (Sir P. Blaker), however, made the shrewd and telling point that Hong Kong has never been dependent on—has never enjoyed the luxury of living in its dependency on—a democratic China. Deng Xiaoping is 84 years old, and there will undoubtedly be more change in China long before 1997.

The Chinese now face a double-generation gap, between the octogenarians on the one hand and the students on the other. Time is undoubtedly on the side of China's youth. In the long run, that will be good for both China and Hong Kong, but do not let us delude ourselves into believing that stability in Hong Kong is in any way dependent on the emergence of what we call a democratic regime in China. Extravagant gestures and statements are rarely good guides in foreign policy.

There is no such thing—in Hong Kong, China, Britain or anywhere else—as a cast-iron guarantee for the future. I have always believed that the main threat to Hong Kong's future stability and prosperity comes not from China or Britain but from some of its own people, who—as the right hon. Member for Plymouth, Devonport (Dr. Owen) said in what was a shrewd and serious speech—seem to enjoy peddling the Armageddon scenario. I hope that the harbingers of doom in Hong Kong do not create a self-fulfilling prophecy.

8.29 pm

Mr. Ted Rowlands (Merthyl Tydfil and Rhymney)

Throughout the Select Committee's inquiry we kept returning to a basic but fundamental question: what is the nature of our obligation towards the people of Hong Kong, given, as my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman) reminded the House in his speech, the unique position in which Hong Kong finds itself?

It was my privilege for a number of years to be a Minister with responsibility for our relationships with a number of dependent territories, though they did not include Hong Kong. During the years that I had that privilege, there was a choice for the dependent territories. Either they could choose to make progress towards independence at the pace that they decided for themselves or—the Falklands is a case in point—they had the right not to change. They demanded that right. In 1982, we fought a war on behalf of that right. The problem is that Hong Kong does not and cannot fit into those general characteristics. Self-determination cannot take place because of the curious leasehold relationship.

Given the existence of those unique characteristics, how do we fulfil our obligations towards the people of Hong Kong? I endorse the thrust of the policy, through the Joint Declaration and the draft Basic Law, to establish an autonomous Hong Kong region. Whenever one tries to devise an autonomous constitution, there are always grey areas of responsibility, sovereignty and division of power. In the case of Hong Kong and China, those grey areas were much larger, even before the terrible events of June. Now they are really large, particularly in relation to the changes that are required to the draft Basic Law.

I shall illustrate what is required by referring to one change that the Foreign Secretary mentioned. I am glad that he referred to it again today because he rather muffled what he said last week about article 157—that the interpretation of the Basic Law must be placed in the hands of a joint constitutional court, not in the hands of the Legislative Assembly of the People's Republic of China. That point had arisen even before the June massacre, but now it is a fundamental requirement in any further redrafting of the Basic Law.

The establishment of democratic institutions in Hong Kong must be an integral part of the autonomous character of Hong Kong after 1997. After all that has been achieved, will there be a residual obligation? I believe that there will. However, I do not believe that either the Select Committee or the Government are prepared fully to meet that obligation.

The right hon. Member for Old Bexley and Sidcup (Mr. Heath) said that the present Government cannot bind future Governments over the thorny issue of immigration. There were sage nods when he said that, as though it were an absolute truth. However, when any Government sign a treaty, all future Governments are automatically bound by the terms of that treaty. This treaty is no different from any other treaty. It will bind future Governments, whether Labour or Conservative, to fulfil the obligations under the treaty. Those obligations do not come to an end in 1997. We shall be a party to the treaty after 1997.

The hon. Member for Christchurch (Mr. Adley) referred to the relationship between the leaseholder and the freeholder. He implied that the British Government had been a broker between the leaseholder and the freeholder. That is not an accurate description of the arrangements that are being put in place. The British Government are a party to the whole deal. They are a party to the lease after 1997 just as much as they are a party to it up to 1997.

How does one fulfil any post-1997 obligation? If the British Government of the day consider that there has been a breach of the treaty or that there is a danger that the spirit and nature of the arrangements are being breached, they will be under an obligation to react in a number of ways. They will have to try to prevent any further breaches by making strenuous representations—diplomatic, political and international.

If the breaches continue, what ought the British Government to do then? A future British Government would be under a residual obligation, because they would be bound by a treaty signed by this Government to make arrangements to deal with the possible desire by a large number of people to leave Hong Kong. I do not support the notion of the right of automatic abode in this country at any time. If we give an automatic right of abode to the people of Hong Kong, that will not be an insurance policy, but I believe in an insurance policy of one kind—that if the treaty is breached, certain obligations will fall upon us, however unpalatable and inescapable they may be.

We must ask ourselves a simple question: does that right of abode mean that this country must just be kind, nice and enthusiastic about the people of Hong Kong and treat those who wish to leave Hong Kong as refugees? I do not believe that we should be fulfilling our obligations after 1997, however generous we were and whatever international efforts we made, if we dealt with them only as refugees. They will, of course, have all the characteristics of refugees and they will leave Hong Kong in a hurry at various times. Paragraph 4.16, which appeared in the draft report but which was eventually removed from it, said: A particular option which we would like to see the British Government explore within the European Community is the possibility of granting to the BDTC population of Hong Kong full British citizenship in the event of a breach of the treaty.

We committed a future British Government to a fundamental obligation when we signed the Joint Declaration, however unpalatable that obligation may be. However successful this Foreign Secretary may be in obtaining the support of other Governments, we shall not fulfil our fundamental obligation to the people of Hong Kong if we do not go further than giving them refugee status.

8.38 pm

Mr. Michael Jopling (Westmorland and Lonsdale)

I agree with a great many of the points made by the hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands). Like him, I was a member of the Select Committee. Having spent most of May and June preparing the Select Committee report and interviewing witnesses, I was reminded time and again of the extent to which the Joint Declaration of 1984 was a remarkable document. That has been said by many people in the debate. I am sorry that my right hon. and learned Friend the Foreign Secretary, because of his many duties, understandably was unable to hear the many glowing tributes to him on the achievement of the Joint Declaration of 1984.

It is a pity that when the Select Committee report was published its reception in the media was largely confined to the core issue of the right of abode and seemed to miss the vitally important issues that we proposed in measures calculated to increase confidence in Hong Kong, such as the strengthening of the interpretation of the law, the recommendation to speed up the process towards full democracy and the election of the chief executive, the enactment of a Bill of Rights, the aspiration that we could persuade the People's Republic of China not to station troops on the soil of Hong Kong, and our recommendations for the Armageddon scenario. One Sunday paper put our recommendations on that on its front page, but it could have published it the previous week if the media had taken the trouble to read the Select Committee report.

It was inevitable that, given the strong feelings in Hong Kong, most of the media attention was given to the right of abode. Very strong feelings have been expressed about the report and about what the Government have said on the right of abode. We have been heavily criticised in Hong Kong because the Select Committee did not recommend that the right of abode be given to a total of more than 5 million people—as it could well be in 1997. The Select Committee was divided on the issue. The hon. Member for Glasgow, Govan (Mr. Sillars) referred to the fact that the Committee was divided seven to two. The right hon. Member for Bethnal Green and Stepney (Mr. Shore) and the hon. Member for Merthyr Tydfil and Rhymney joined other members of the Committee in voting against giving the right of abode to all those people.

We have been told that that report was dishonourable. Let us consider what would happen if the House of Commons and the Government changed the law to give the right of abode to all current and potential holders of British dependent territory passports. We understand the background to the pleas that that should happen. We have heard the arguments about a sense of security, a fire escape or an insurance policy. We all know the argument, which I guess is true, that if the right of abode is given it would be unlikely to be taken up by large numbers of people. Although that is put to us both here and in Hong Kong, nothing can remove the basic fact that, although few people might take up that right of abode in the forseeable future, they might nevertheless do so in certain circumstances.

That brings me back to the Armageddon scenario, which has been extremely prominent in the debate. There is no question but that in a dire emergency the right of abode would be taken up. We have to ask ourselves what would happen if, in a crisis, huge numbers of Hong Kong people wanted to come here in a hurry. Frankly, as my right hon. and learned Friend the Foreign Secretary has said, we could not accommodate them in huge numbers. My right hon. and learned Friend was right to say that it is unrealistic to suppose that we could. It is not realistic to envisage 5.5 million people wanting to come here. I do not believe that the transport facilities would allow that, but if we were confronted with even 1 million people, I do not believe that the United Kingdom could absorb them.

Sir Russell Johnston

Will the right hon. Gentleman give way?

Mr. Jopling

I shall not give way as I have only 10 minutes.

My guess is that in a cataclysmic situation after 1997, if our successors in the House of Commons were faced with that massive, unmanageable flow of people into the United Kingdom—if that unlikely situation should occur—they would be forced to put a stop to it. If we are asked to provide an insurance policy which would be called upon only in a time of extreme crisis, but which, as I have tried to explain, could not possibly be cashed, we have to ask ourselves whether it is not more honourable to say no now, rather than be forced to say no and renege on previous undertakings in the future. I believe that it is more honourable to say no now.

The world community now must concentrate on creating a contingency plan, as my right hon. and learned Friend the Foreign Secretary suggested in his evidence to the Select Committee on 14 June when he said that it is … inescapable that the United Kingdom with its special responsibility for the territory would be the country to which they would look for treatment as refugees and we would have to try and discharge that responsibility with the help of others. That is entirely right. The Select Committee supported my right hon. and learned Friend's undertakings on 14 June. Clearly we have a duty to take the lead in preparing a plan with the international community. I do not advise my right hon. and learned Friend to try to extract numbers from countries which he felt might be helpful. If he does, he will not be successful. Most countries which would be helpful in a crisis certainly would not be prepared to commit themselves to certain figures at this stage of negotiations. The failure to get figures would create more despondency and lack of confidence in Hong Kong. It is far better for my right hon. and learned Friend not to start talking numbers but to try to evolve a plan.

It surely must be more satisfactory for Hong Kong to have a worldwide solution of the problems of cataclysm rather than a purely British solution which could not be delivered. We must not forget that if we had given a right of abode, there would be no way in which we could get a plan out of anyone. I hope that my right hon. and learned Friend will proceed on those lines to try to get general agreement, realising that it is probably not practicable to be specific.

8.48 pm

Mr. Terry Fields (Liverpool, Broadgreen)

There is an inextricable link between current events in China, historical events and future events. Today's problems need to be addressed against a background of the death, persecution and repression of the Chinese working class, students and peasants, and the worldwide condemnation of the bureaucracy in China. Clearly, words are cheap and action is necessary to support the democratic process in China and give sustenance and support to the people of Hong Kong who view those atrocities with extreme caution.

In the aftermath of the repression of working class students and peasants in China, we have seen the gloating of those anti-working-class elements in British and other societies, who say, "If this is Socialism, with tanks, guns, and flame throwers on the streets, it is little wonder that people are rising against it." We must explain the reasons why those events in China took place, and continue to take place. More important, we must differentiate between the Stalinist regimes of eastern Europe and China, which are labelled Socialist, and the reformist regimes in the West, which are also labelled Socialist. I believe that they are no more Socialist than the British Government, with their lack of democracy and accountability of officials and elected representatives. We need a political and economic analysis.

I shall go on a journey into the past and look into the position in Russia and China. In 1949, the Chinese picked up the Stalinist model, which had been prevalent for almost 30 years in Russia, and adapted it for their own devices, with all the deformities that occurred under Stalin after the 1920–24 period. Although we applaud the kicking out of capitalism and landlordism in China, we completely condemn the lack of democracy and proper freedom for millions of people in China, just as we condemn it in the Russian states.

I do not expect the Foreign Secretary to accept a Socialist analysis. I certainly do not accept his analysis. The reforms that the right hon. and learned Gentleman welcomed and that, unfortunately, my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman) welcomed are the direct result of what has happened in the past few weeks and months in China. The reforms have been responsible for raising the expectations of Chinese workers, for the inability of the deformed workers' state to come through with the goods and for the repression that has followed.

Much of the recent economic growth in China was stimulated by the growth of agriculture and industry in the rural sector. Under central planning, huge sectors of heavy industry have been built up. China is now the world's fifth largest industrial producer, but the countryside still exerts enormous pressure on society. At the heart of Deng's new policies was a dramatic shift towards production in the rural areas. This marked a brief break from the overriding emphasis on industrial accumulation, the track followed by the rural bureaucracy in China since the revolution.

We must be honest—there was a recovery between 1977 and 1985 in China. National income per capita grew at an average rate of 16.89 per cent. per year, compared with 3.22 per cent. between 1966 and 1976. However, increasingly expensive inputs of investment, labour, energy and raw materials failed to produce a commensurate increase in manufactured goods, especially of the more modern and technological variety. As more complex technology demands greater skill and more initiative and co-ordination from the work force, so the problem becomes much more acute. In this sense, China's economic experience was mirroring and catching up with what was happening in the Soviet Union. Deng and his cohorts had no confidence in the working class. The conscious involvement of workers in running society—the key to running a planned economy—would threaten the power and privileges and prestige of the ruling class, so workers were not involved in central planning.

The leadership chose the easy option—a turn towards the countryside, with policies aimed at stimulating farm production, rural industry and services. This produced a phenomenal spurt of growth in the economy, but it was only one-sided. Gains in the countryside have already rebounded on the cities. During that period, the leadership bowed to the enormous pressure for change that had fermented in the rural sector. It allowed the rapid dissolution of the collective farms, to be replaced by the household responsibility system, under which households contracted to sell a quota of produce to the state. At the same time, state prices for produce were raised significantly. Those measures stimulated big, all-round increases in output.

In the second phase, beginning in 1985, the Government went even further. Households were granted 15-year leases on the land, with the right to reassign occupancy. The long-standing state monopoly on the purchase of grain and other major farm products was abolished. Although the state retains the right to buy quotas under contracts, there is largely a free market in agricultural produce.

Encouraged by incentives, there were dramatic increases in output, but there were contradictions. Increased agricultural output was accompanied by a massive growth in- rural industry. "Specialised households" involving 70 million workers provide employment for a section of the redundant rural labour force and account for about 40 per cent. of the rural sector's gross value output.

Until 1986, the new policies appeared to be a great success. Western commentators, gladdened by Deng's turn to capitalist methods and excited by the prospect of China's boundless market, could not praise China enough. But things have turned sour. A glance beneath the surface of the market reforms shows why. According to Deng, there are no fundamental contradictions between a socialist system and a market economy. That comment about Socialism and capitalism being linked has been made a little closer to home. However, markets are essentially unplanned—unlike the planned economies of China and of Russia—attracting resources to the most profitable sectors regardless of the economy's overall needs and undermining the effectiveness of central planning. There is a contradiction between the direction that Deng and his bureaucrats are taking and the basis of a workers' state.

Grain production, for instance, has declined alarmingly after reaching record levels in 1984. The effectiveness of price incentives has been undermined, partly by the increased cost of inputs, partly by more attractive prices for other crops. In some areas, local councils have insufficient cash to pay for the state's quota of grain, so peasants have stopped growing crops. The state has been forced to import increasing quantities of grain, spending $1.5 billion of valuable foreign currency on 16 million tonnes of grain in 1988. There are contradictions in a so-called planned economy venturing into a capitalist system.

Recently, the Government introduced preferential allocations for farmers—in reality, a form of rationing, which contradicts the reliance on market methods. Naturally, farmers in those areas have responded by producing the crops for which they get the highest prices—in tune with a capitalist economy. That has meant the production of more cotton and tobacco and less grain and other foods. Shortages and higher prices have helped to accelerate the general inflationary trend, which is fastest in the cities, where the incomes of workers have not risen as fast as in the countryside. A hotch-potch of contradictory economic and political policies is prevailing in China. The workers reacted to that.

Last year, according to official figures, 35 per cent. of Chinese cities and towns suffered a cut in living standards. Inflation and unemployment rates have risen and, as a consequence, workers have moved into action. In the struggles in China, workers have accompanied students and peasants and reacted against the reforms that have taken place. The bureaucracy finds itself isolated and incapable of dealing with the problems that affect the people of China.

The Chinese workers' demands were exemplified by students in Tienanmen square. They want democracy. Instead of claims that it is a move to capitalism, we must listen to the brave students who went to their death singing the "Internationale". The events over the next period have already predicted by strong calls in relation to international capitalism, and a similar warning—

Mr. Deputy Speaker (Mr. Harold Walker)

Order. The hon. Gentleman has exceeded his time.

Mr. Fields

I will sit down after this sentence, Mr. Deputy Speaker.

We warned the Government against short-term expediency. Wider and larger perspectives are necessary. Ultimately, the result of the struggles in China will be mirrored in Hong Kong, Britain and around the world. Workers of the world will unite, and the days of this and reactionary imperialist Governments around the world will be numbered.

Mr. Deputy Speaker

The time limit on the length of speeches is about to lapse. I hope that hon. Members will still make brief speeches and allow as many other hon. Members as possible to participate in the debate.

8.59 pm

Mr. Cyril D. Townsend (Bexleyheath)

The speech by the hon. Member for Liverpool, Broadgreen (Mr. Fields) reminded me of Swinburne's lines Even the weariest river Winds somewhere safe to sea. I hope that the hon. Gentleman is satisfied with the conclusions that he reached.

There is a strange phenomenon in Hong Kong. The richest and smartest people live in flats on the Peak, but for much of the year a cloud settles round that Peak, completely destroying visibility. Perhaps when the House next debates the vexed question of Hong Kong and its relations with China hon. Members will have escaped from the dark cloud that was created by the appalling atrocities in Peking and will see the relationship in an entirely different and, I hope, rather better way.

In recent weeks, I have been astonished by comments in the media. One has had to check one's own moorings. It was as though Hong Kong had been towed 100 miles into the South China sea and had broken all its traditional links with the Chinese mainland. The columnists and critics who often appear on my right have suddenly appeared on my left, in shrill and emotional terms reminding my colleagues and me of our moral obligations to the people of Hong Kong in a way that I found bizarre.

I will give some examples. It is outrageous to suggest that any British Cabinet would say to the people of Hong Kong, "If you run into real trouble, millions of you can seek refuge in the United Kingdom, but we say that only to give you confidence; for heaven's sake, do not ever try to do so." No Cabinet or political party would react in that way, and I cannot believe that any legislation framed from such decisions would get through the House of Commons.

Believe it or not, one or two papers suggested that the well-educated people of Hong Kong might move in their thousands or millions to an island off Scotland, to be self-contained and to create wealth for themselves and the United Kingdom. It would have to be an Islay or an Alcatraz. We would have to stop them by force from coming to London and other big cities to improve their business opportunities.

A weird letter from some old fool was given prominence in the Spectator last week. It suggested that the Gurkha garrison in Hong Kong should be dramatically increased so that Hong Kong's defences could be made secure. That brought back memories for me. I served as a soldier in Kowloon in the mid-1960s. We endlessly discussed whether after we had mined some passes and blown up some tunnels we could keep the Chinese army out for 12 or 24 hours. At the latest count, the Chinese People's Liberation Army has 2.3 million personnel, and the combined forces of China have roughly 3.2 million. The reality is that Hong Kong is totally indefensible in military terms. In about 12 hours, if they wish, the Chinese could change the sovereignty of the colony. Britain has very few cards to play, and most of them are rather low.

I remember at that time a water shortage in Hong Kong, when the taps were on for only four hours every fourth day. It certainly gave a new importance to aftershave. It also reminded us of how totally dependent the geography and the physical being of Hong Kong is on mainland China because negotiations were then taking place so that we might be allowed a little more water from China's vast reservoirs.

I then moved to Hong Kong island and worked as a member of the Hong Kong Government for 18 months. I paid Hong Kong income tax, which I assure my hon. Friends was most beneficial to me. It was explained to me that Hong Kong would not be like Gibraltar—a permanent colony—and that it would not become independent like Kenya or the other east African colonies but that its future lay in reverting to the Chinese mainland in 1997. That concept was entirely accepted by the people of Hong Kong at that time. Indeed, one reason why they paid so little income tax was that Britain had certain obligations, especially defence obligations, and Hong Kong was on a special route. I remember Reggie Maudling, when he was Chancellor of the Exchequer, arguing in Government House with the governor, Sir David Trench, for whom I was working, about Hong Kong's financial support for our defence forces. I suspect that that issue still rumbles on in the cloisters of Whitehall. I see my right hon. and learned Friend the Foreign Secretary nodding his head.

I was told that the Chinese were after Taiwan above all; that they would put up with a lot in relation to Hong Kong, but that, ultimately, Macao and Hong Kong led to Taiwan. Taiwan is linked with the civil war and has far more significance and historical importance for them.

If I am asked what Britain can do at this stage, I have to say, "Do nothing in particular, but do it well." I take an optimistic view about China. Experts say that every six years since the world war the politics of China have shifted dramatically one way or the other. Therefore, it does not seem far-fetched to expect another shift to occur during the next eight years. China's leadership has gone well beyond the biblical barrier of three score years and ten. It is a leadership despised by its own people and disliked by almost every other country.

In this day and age the rulers in Peking must acknowledge the power of radio and television. The BBC World Service has said that it has an enormous audience throughout China. That audience understands that elections are taking place in Poland and that in Hungary parties other than the Communist party will be able to stand. Of course, they then wonder why the Chinese people should be permanently kept from the democratic process.

I am optimistic that, between now and 1997, we will have an improved relationship with China. In the meantime, it makes sense to increase democracy in Hong Kong. I should like a Chinese-Hong Kong citizen to be elected as the chief executive, governor, president, or whatever the head of the administration is to be called. I should like HMS Tamar to be set aside for our future consul general, as the Select Committee recommended. However, those are small matters of detail when one realises that we can never really restore the confidence of the Hong Kong people because a silly speech in Peking or a foolish move by the military command can totally obliterate any feeling of well-being that may have been built up.

I encourage my right hon. and learned Friend and the Government to keep going on the path that they have set themselves. The agreement reached in 1984 was an astonishing agreement—a landmark in British diplomacy. If anyone doubts that, he should look at the concessions that the Chinese Government made to the British Government over Hong Kong. If we keep on the path that we have set ourselves and act with courage, I believe that history will show that we took the right course.

9.9 pm

Mr. Bernie Grant (Tottenham)

I am certainly the only person present who has suffered under British colonial rule, root and branch. I was born in a British colony, so I have much sympathy with the people of Hong Kong.

Serious though the debate has been, there has been much hypocrisy. There have been two sorts of hypocrites: first, those who disgracefully tried to blame the people of Hong Kong for fighting for their rights, such as the right of abode. They said that the Hong Kong people are spending money on advertising and talking about things such as Armageddon. They sought to blame the victims for the situation in which they find themselves. That is completely abhorrent. The other hypocrites have been very sympathetic. They say, "We are so sorry about what has happened, but there is not much that we can do about it. Britain has nothing up its sleeve in terms of negotiation with the People's Republic of China, so we had better sit down and accept it". I reject thoroughly both of those views.

I pay tribute to the high-powered delegation of professionals from Hong Kong, including doctors and lawyers, who are in the Gallery and who have listened to the debate. They must be disappointed at the level of debate.

Some people have said that they oppose the right of abode. I am certainly not of that view. Some people have said that, if there is trouble in China, we can take people in as refugees. But the difference between a refugee and a citizen is immense. If a problem blows up in Hong Kong, perhaps in 1998, people coming here as refugees would be put in a refugee camp with no rights and would be treated in the same way as other refugees all round the world. They would be lucky if they could get jobs. But a citizen, with the right of abode could come to this country any time and do what he liked. He could work and participate in the National Health Service. He would not have to wait for the British Government to give him refugee status.

It was amazing that my hon. Friend the Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) should say that if the treaty is breached we will make those people British citizens. Is he saying that, in circumstances such as occurred in Tiananmen square, the staff in the British embassy would stay up all night handing out British passports to Hong Kong citizens so that they could come to Britain the next day? That is nonsense. That could never occur. If people try to lead others down that path, that is completely wrong.

Mr. Rowlands

Will my hon. Friend give way?

Mr. Grant

No, I do not have much time.

I am also worried about the position of the Opposition Front-Bench spokesman on the right of abode. I believe that Labour party policy is to repeal the British Nationality Act 1981. The residents of Hong Kong cannot come to Britain because, under that Act, they are deemed to be British overseas citizens. If the Labour party is pledged to repeal that Act, it would therefore repeal that provision, and Hong Kong people could then come to this country and have the right of abode. I hope that, when he winds up, my hon. Friend the Member for Carrick, Cumnock and Doon valley (Mr. Foulkes) will explain that apparent contradiction in Labour party thinking.

I want to pick up one or two points of the Foreign Secretary. I will not be one of those hon. Members who praised him, because I said in a previous debate: The Foreign Secretary's contribution seemed a tiny bit complacent. He is trying to make out that all is well and that everything is under control, but my information is that people are very worried. They feel that there is a crisis of confidence in Hong Kong. There is a general feeling that the Government, having signed the joint declaration in 1984, are now about to wash their hands of Hong Kong."—[Official Report, 15 July 1988; Vol. 137, c. 720–21]. I continued in that vein.

Today the Foreign Secretary also said that a Bill of Rights will soon be introduced which will incorporate all the rights and freedoms currently enjoyed by the people of Hong Kong. I welcome that, but will there be proper consultation with the people of Hong Kong before it is introduced? What mechanisms will be set in place to ensure that the majority of the people of Hong Kong—I stress "majority"—will be consulted on this issue? Will the rights in that Bill be enforceable by the courts against not only the Executive Council, but the Legislative Council? In other words, will the courts be able to declare null and void any laws that may be passed that violate the rights contained in the Bill of Rights?

The draft Basic Law contains no general right to non-discrimination, to equal opportunity or any rights against sexual or racial discrimination. Will that be remedied in the Bill of Rights that he is proposing?

I support those people who talk about 100 per cent. direct elections to the Legislative Council by 1995. A quarter of the Legislative Council should have been elected in 1988, but that was not done. It is important that 50 per cent. of the members of the Legislative Council are in place by 1991. The Government must also drop their previous insistence that reforms before 1997 must dovetail with the Basic Law. On the contrary, the Government should insist that the Basic Law provides for the continuation of democracy.

The events are about real people. When we debated this matter on a Friday morning in July last year few hon. Members were present and certainly no right hon. Members, apart from the Foreign Secretary, were present. The position has changed dramatically since then. People's lives are being affected daily. In this debate I have not yet seen the emotion that I saw when I met people outside the Chinese embassy. I have seen no tears in here, but I have seen tears when I have spoken to people in my constituency whose families or friends have been murdered in China. When the House begins to take this issue seriously and when people begin to talk about the problems of real people, the House will achieve some credibility.

I want to give the Home Secretary an opportunity to do something. A Chinese person living here, Mr. David Choi, who is also known as Shu Lai Ming, and who used to work for the New China news agency, has applied for refugee status in Britain. If the British Government are serious in their concern for the people of China and Hong Kong, they should grant him refugee status quickly and they should give him the travel documents that he needs so that he can meet the rest of his friends and colleagues in Paris. That is something concrete that the Home Office could do quickly.

We have not been primarily affected by the problem. We can sit here and say all sorts of nice, plausible things that sound good and read well in the newspapers. I want people to take direct action and I hope that the Foreign Secretary and the Home Secretary will do something about the case I have highlighted.

I should have liked to have made several points about the draft Basic Law, the Legislative Council, and the special administrative region, but this is not the time to fine-tune our approach to such matters. This is the time to settle basic issues. One basic issue which I am ashamed has not been settled and is not being supported is the right of abode of the people from Hong Kong who are suffering or who may suffer. I hope that soon the British Government will alter their policy and allow those people into this country.

9.20 pm

Mr. Andrew Rowe (Mid-Kent)

My feelings about this issue are undoubtedly coloured by my experiences of the past few months. At Easter I went to Peking and Hong Kong and enjoyed a remarkably encouraging and optimistic visit. I met a number of elderly, senior Chinese officials who had been victims of the cultural revolution and who were undoubtedly feeling that exciting and interesting experiments were taking place in China. They looked forward to a major improvement in the Chinese economy.

I came away from those countries and left behind my stepdaughter who, for nine months of this year, has been studying in Peking and has spent a considerable time in Tiananmen square. It became wholly apparent that, whatever eventually happened to that great demonstration, it began as a small group of students who were worried about the future of their education and wanted to speak to somebody senior in the administration. They did not want to change the political system or dramatically alter the way in which things were done, but simply to receive some assurance about the future of education and make the point that it would be reasonable to allow people to choose their own career, rather than being dictated to class by class by the central bureaucracy. It was the extraordinary failure of anyone to come out of the forbidden city and talk to the students about their problems which gradually caused the enormous change in the demonstration.

My daughter told me that throughout the demonstration people throwing stones were handed over to the police by the students. She said that anyone could walk anywhere in Tiananman square, down carefully kept paths which were remarkably clear, and that everybody was extraordinarily good-natured—far more so than normal—throughout those weeks in Peking. The idea that these people had to be shot down in cold blood or run over by tanks was such an extraordinary failure, both of will and of political skill, that it is not at all surprising that the people of Hong Kong should feel completely destroyed by it. It is a strange, and not, I hope, a significant coincidence that the Joint Declaration should have been signed by Zhao Ziyang. Where is he now?

Temperamentally, I feel very much drawn to the proposition that we should courageously gamble with the suggestion that everyone should be allowed the right of abode. However, it is perfectly clear that that is not a practical proposition, not least because of the long period over which this right would exist, and the extraordinary difficulty of policing the numbers and deciding who should, and who should not, be entitled to it.

There is a serious danger facing Hong Kong. It is not because in 1997 the Chinese Government will walk into Hong Kong with the intention of overriding the existing Government, taking over and going for the people of whom they disapprove, but because some editor, journalist or student exercising the historical freedom of speech to which he or she has become accustomed says something which cuts to the quick the thin-skinned rulers of China and is arrested for something which is not, in any shape or form, an offence under Hong Kong law. Then there will be some sort of riot justifiabily demanding the release of the detainees. At that point, the Chinese Government may well declare that the matter is an internal one concerning only their internal security. They will claim a right to suggest that the treaty has been torn up and they will take over. This is why I was especially glad that my right hon. and learned Friend said that the Hong Kong Government must be part of any decision on whether a state of emergency exists.

Since we are clutching at straws, let us also insist on much greater democracy in Hong Kong. When I was there at Easter, I was told in terms that any planter in a Somerset Maugham story would have recognised that we cannot let the people have real democracy—they would vote for the wrong people, most of them do not want it and would not know how to use it, democracy was terribly destabilising, and China did not like the idea anyway.

In fact, it was made clear to me by a number of other people that Hong Kong is ready for democracy. As my right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath) rightly pointed out, if there are already embryonic parties, the way to ensure a proper democratic Government in Hong Kong is for all who are not organised in parties to start organising. The enormous growth of pressure groups and voluntary organisations working effectively to put their point of view to the bureaucracy in recent years clearly shows that Hong Kong is ready for democracy and should certainly be given it soon.

My right hon. and learned Friend and the Government should not under-estimate the generosity of the British. Letters from, and personal meetings with, constituents have shown me that they do not want us to behave dishonourably towards Hong Kong. They want us to decide generously whom to receive. If we go around talking about enormous numbers all the time, we could easily generate the sort of atmosphere in which even the 30 widows whom the Select Committee rightly suggested we should receive would be unwelcome. Alternatively, if we make a generous statement about how many people this country is prepared to receive, that will enormously strengthen our bargaining position with the rest of the world. How can we possibly ask the rest of the world to be generous if we are mean?

9.27 pm

Dr. Jeremy Bray (Motherwell, South)

The only insurance policy on offer is one that Hong Kong people will have to organise for themselves. It needs to be a massively organised operation. It needs advance parties establishing themselves in host countries, viable in themselves and making a contribution to those communities from the start. The operation needs negotiation between the Hong Kong Government and not only national Governments but local, provincial, district and city governments. It needs lines of credit organised by banks accustomed to drawing on international financial markets to finance Chinese business. It needs the establishment of overseas operations outside Hong Kong and China by all the large and many of the small businesses in Hong Kong.

Preparations on this scale entail a migration of skilled professional people considerably in excess of the numbers now moving, as every insurance policy involves the payment of an insurance premium. If every job created by a Hong Kong Chinese for a Hong Kong Chinese leads to the creation of a job for a person in the host community, it will be possible to build up these advance parties and prepare the ground for a much larger-scale migration, if that were called for.

If all went well with the People's Republic, this Chinese diaspora would be of great benefit to Hong Kong and China because of the world-wide links that it would build up. If all did not go well, it would constitute a formidable sanction in the hands of the people of Hong Kong, which would make Hong Kong far less attractive to the PRC if it neglected the rights of the people there. The timetable for democracy to elect the Government that would be needed to carry this out, as set out in the Select Committee report, is too slow. There can be direct elections this year, with three months preparation, for 50 per cent. of the Legislative Council, with 100 per cent. in 1991, with not only the election of the chief executive from the Hong Kong Chinese, but also the appointment of heads of department and every senior officer of the Executive. The people of Hong Kong have only eight years in which to organise this effort. They must get on with it now.

9.30 pm

Mr. George Foulkes (Carrick, Cumnock and Doon Valley)

In May, the official Opposition pressed the Government for a debate on Hong Kong, as we did last year, so that we could discuss the second draft of the Basic Law. If we had had that debate, we would have greatly welcomed the changes from the first draft giving greater autonomy to the Hong Kong special administrative region after 1997, agreed by the People's Republic of China, but we would have called for quicker progress towards greater democracy and we would have pressed a number of issues relating to the protection of civil and human rights within Hong Kong, as my right hon. Friend the Member for Bethnal Green and Stepney (Mr. Shore) said. Sadly, as right hon. and hon. Members have so readily said, the tragic massacre in Tiananmen square and the subsequent purge, repressions and executions that continue today have dramatically changed the nature and the urgency of the issue before us and the world. We are today debating China as much as Hong Kong.

In our relations with China, the United Kingdom has a special responsibility to consider the effect of anything that we say or do on the future of Hong Kong, but the Government, and particularly the Foreign Secretary, have the balance wrong. The Foreign Secretary tends to confuse propriety and obsequiousness and to put commercial concerns higher than morality. The House should not need reminding of the brutal nature of the massacre. The dramatic media coverage brought swift and universal condemnation from all parties here.

We must also remember that our support and encouragement were given to the demonstrators in support of democracy in China. It was reasonable of them to believe that our support was genuine, not fair weather support, and equally reasonable of them to expect that we would stand by them if the going got rough—and it has become really rough. My right hon. Friend the Leader of the Opposition said a month ago, to acclamation from both sides of the House: the memory and meaning of one unarmed young man standing in front of a column of tanks in Peking yesterday will remain with the British people long after the present leadership in China and what they stand for have been forgotten."—[Official Report, 6 June 1989; Vol. 154, c. 14.] That memory and meaning remain with the British people, and they remain with the Opposition. I hope that they also remain with the Government. If they do, the Government will have no hesitation in insisting that the 48 Group trade mission, led by Sir Trevor Holdsworth, president of the Confederation of British Industry, should be cancelled. I hope that the Under-Secretary of State will say that unequivocally.

As my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman) said earlier, and as I said yesterday, the Chinese Government are exploiting all these contacts for propaganda purposes. They put the telegram from the 48 Group saying that it was still coming despite the massacre on the front page of the People's Daily. How can Sir Trevor shake the hand of Li Peng while young students are still being brutally executed with a bullet through the back of the head? We must make it absolutely clear that it cannot be business as usual until the purge, the repression and the executions stop.

I hope that the Under-Secretary of State will confirm that the Government will help Chinese students in Britain and that that help will include extending visas for an open period, issuing travel documents to those whose passports expire and enabling them to help themselves financially by allowing them to work here. It is to the students here and in other countries that a future, more enlightened leadership of China is, we hope, to be entrusted.

The events in China have sent shock waves through Hong Kong, as my right hon. Friend and I saw when we visited the territory within a week of the massacre. We accept that there is a great need for action to restore confidence, but I must respectfully disagree with the right hon. Member for Old Bexley and Sidcup (Mr. Heath) as we do not think that it was adequately met by the tardy and dithering visit of the Foreign Secretary, even though we would not go as far as The Times leader in describing it as inept and pointless.

As the House knows, we are not in disagreement with the Government about the difficulty of agreeing to the request to grant the right of abode in the United Kingdom to almost 6 million people in Hong Kong, as some have suggested, or even the 3.25 million eligible for or holding British dependent territory passports, although we fully recognise the strength of feeling and the sincerity of those in Hong Kong who have argued that case. The right hon. Member for Old Bexley and Sidcup—when he was awake—rightly questioned the basis of the claim to the right of abode, or the obligation of this country to provide that right of abode.

In the time available I cannot answer all the points raised by the right hon. Member for Yeovil (Mr. Ashdown). However, in answer to one point I must tell him that when dealing with matters of immigration, right of abode and the granting of refugee status, any consideration of the economic or social usefulness of potential immigrants, such as he suggested, is not only irrelevant but obnoxious. Surely we accept people as a matter of principle and not because they might boost our gross national product or alleviate our skills shortage.

Mr. Ashdown

The hon. Gentleman makes a good point. As the Opposition, on a matter of principle, opposed the 1981 Act—the consequences of which they now support—is he saying that their opposition was wrong at the time or that their actions now are wrong on the basis of that principle?

Mr. Foulkes

On this issue, as on the issue about which I intervened in the right hon. Gentleman's speech, he wants to have it both ways. He said that we should take people for the reasons that I have just outlined, and I think that that is wrong.

We criticise the Government for not presenting a clear, powerfully articulated and credible alternative for restoring confidence. Such an alternative comprises three elements. The first is a firm commitment to full democracy on a fixed timetable. The second is a resolute approach to dealing with China, with the reminder that it is in its interests not only to return to civilised behaviour but to keep Hong Kong stable and prosperous. As right hon. and hon. Members have said, it is in China's interests to say—and even more so to do—things that will help reinforce confidence in Hong Kong. Thirdly, and above all, we believe in the vigorous pursuit of an international safety net, first advocated by the Opposition and now endorsed by the Select Committee.

In every debate on Hong Kong in this House, the Opposition have pressed the case for early and extensive democracy, but we have had procrastination and excuses galore from the Government. Britain is on very weak ground when criticising the lack of democracy in China or anywhere else while we retain colonial paternalism in Hong Kong. We wanted direct elections in 1988, but tragically—and even laughably in the light of subsequent events—the Government said that the people of Hong Kong were neither ready nor sufficiently sophisticated for that. Now there can be no excuse for delay.

We fully support the formula of the Foreign Affairs Select Committee for 50 per cent. direct elections to LegCo in 1991 and 100 per cent. in 1995. We also want some discussion on the possibility of electing in 1995. on the basis of universal suffrage, a Hong Kong Chinese resident with the appropriate age and residential qualifications as governor and chief executive designate—notwithstanding the uncertainty and equivocation of the right hon. Member for Yeovil on the subject. The Government might say that that will need the agreement of the Chinese Government, but unless we take a stand and argue our case forcefully we shall continue to be perceived as kowtowing to the People's Republic of China on this and on other issues.

We accept that the views of the people of Hong Kong should be the main determinant of the nature and speed of introduction of democracy, but when there is no directly elected legislature to consult it is difficult to know how to determine what the views of the people of Hong Kong are. The assessment office device, which was used previously, was seriously flawed, as we have said in previous debates. If the Government do not accept, as the Opposition do, that the position is already clear from the current clamour for more and speedier democracy, surely a referendum on the options could and should be considered.

Of even greater urgency is an alternative to the right of abode. We have argued strongly that an international safety net is needed. That would not only be more credible because, as hon. Members on both sides of the House have argued, a group of countries could accommodate the numbers involved with less difficulty, but it acknowledges that many people in Hong Kong, if they really have to leave—we know that they do not want to—would prefer to join established Hong Kong Chinese communities in Canada, the United States, Australia, New Zealand, Singapore and other Pacific rim countries.

If that is to be credible as an alternative, it needs to be pursued with some urgency and, if reports in the press are correct, they do not suggest that the Government are responding quickly and urgently to the pressure from the Select Committee on Foreign Affairs and the Opposition. The Foreign Secretary referred to that slightly more positively today, but a sense of urgency was still lacking. The Foreign Secretary's only response—the offer of passports to the elite—is the one which, as my right hon. Friend the Member for Gorton said, is most likely to cause division and dissent within Hong Kong. We urge him to think again about that before making the statement that he promised.

On a more positive note, we welcome the commitment to introduce a Bill of Rights, but a number of questions on that are still outstanding—most notably those relating to its form and timetable. I hope that the Under-Secretary of State will answer those questions, if not tonight, as quickly as possible. We also welcome the commitment to raise with the Government of China article 14 of the Basic Law on the stationing of troops of the PLA in the Hong Kong SAR after 1997—with the firm intention, I trust, of altering it. However, none of that is yet enough, especially combined with the Foreign Secretary's muffled message technique to restore the flagging confidence to which the huge queues outside the Singapore office testify. It needs a strong commitment and urgent action on the three areas that I have outlined.

It would be wrong to have a debate on Hong Kong and China without dealing with the plight of the Vietnamese boat people. No one who, like my right hon. Friend and I just a few weeks ago, has seen those bright eager eyes behind the wire netting of the closed camps pleading not to be sent back to Vietnam could ever forget them. We endorse the British Refugee Council's deep concern that forced repatriation would mean them returning to re-education camps and ill-treatment.

The British Refugee Council rightly asked that we should encourage voluntary return, seek detailed promises from the Government of Vietnam on their care, get the United Nations High Commissioner for Refugees further involved and develop improved aid and other links with Vietnam. Economic development there will encourage others to stay and those who have left to return. It is also imperative that the Chinese stop assisting the continued flow of refugees and that Britain takes a lead to ensure that all those who were in Hong Kong before June 1988 are resettled, as agreed in Geneva. That applies also to genuine asylum seekers beyond that date.

It would be wrong not to consider the other end of China, and acknowledge with some remorse that the events in Peking have vindicated those who said that we accepted the Chinese Government's version of events in Lhasa too readily, and that the West's timid stand on Tibet may have contributed to the Peking tragedy. We should question why we are more ready to forgive China's transgressions than those of other countries, and whether it is right to give trade and investment priority over human rights and morality. Of course we want to see our relationship with China return to normal, and of course we recognise the vital importance of that to Hong Kong—and we must at some time resume talks on the Basic Law—and of course we desperately hope that China will return to the path of increased openness, but we cannot and should not resume normal relations until the killing and repression have stopped. I am sure that eventually there will be the necessary rapprochement, but we should never forget those who sacrificed their lives for democracy.

9.45 pm

The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Mr. Timothy Eggar)

We have had a full and serious debate. At times it has been impassioned, and rightly so. There have been many notable and memorable contributions. The House has yet again exhibited its unanimity of concern for Hong Kong—a unanimity of concern that transcends party boundaries, which was demonstrated in the report of the Foreign Affairs Select Committee. The speeches have, as usual, reflected right hon. and hon. Members' detailed knowledge of Hong Kong, its problems, challenges and successes. I shall try to answer as many as possible of the questions asked by right hon. and hon. Members in all parts of the House in the time that I have available.

The hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) asked about the proposed mission to China by the 48 Group of traders. I assure the Opposition that the Department of Trade and Industry is in consultation with the 48 Group, and the question of the Government's financial support is being reviewed in the context of those consultations. I understand that the 48 Group itself has been reconsidering its plans.

This evening the House has accepted that the fundamentals of the Government's policy on Hong Kong remain the right ones—right because they offer the best chance for the people of Hong Kong to sustain their way of life after 1997. That is what the people of Hong Kong want—and it is what Britain, the Government and this House want for them. It is also what China is pledged to accept without conditions—and to continue to accept as its own economic and political system evolves in the years up to and beyond 1997.

Tragic recent events in China mean that Hong Kong, understandably, looks to this House for reassurance. Many right hon. and hon. Members stressed the importance and extreme difficulty of rebuilding confidence in the territory. The hon. Member for Carrick, Cumnock and Doon Valley seems to think that it is simply a matter of discovering three magic wands, and of waving them, to make the problems go away. I do not pretend to believe that we can lay to rest all of Hong Kong's fears. The events of 3 and 4 June were too awful and too recent to allow us to say to the people of Hong Kong, "Don't worry." We would not presume to do that. However, we are working to give Hong Kong the reassurances that it needs—the reassurance of a Bill of Rights, of more changes to the Basic Law, and of more rapid progress towards representative government. We hope that, by doing so, we shall help to restore confidence in Hong Kong.

However, China—as many of my right hon. and hon. Friends said—also must play its part in restoring confidence in Hong Kong. China must demonstrate and re-emphasise its commitment to non-interference in Hong Kong—a commitment that it has already made.

I understand the feelings of many hon. Members that in these difficult circumstances it is right for us to give democracy to Hong Kong as quickly as possible. That is why we are carefully considering the pace and nature of democratisation. When we take these critical decisions, it is important that they are the right ones. As my right hon. Friend the Member for Blackpool, South (Sir P. Blaker) said, a consensus is absolutely essential. It would be wrong to rush in and make snap decisions before opinion in Hong Kong has crystallised and to seek to impose our solution in this most delicate area.

Clearly, there has been a shift of opinion in Hong Kong. Even before the events of 3 and 4 June, OMELCO had called for a faster pace of democratisation. We need to see whether that remains its view. It is already clear that plans for elections in 1991 will have to be reconsidered. We shall pay careful attention to that. Ever since the 1984 declaration, we have aimed to achieve continuity up to and beyond 1997. The Hong Kong people understand and share that objective. It must be right for us to seek to ensure that the democratic system that we establish before 1997 should continue after the transfer of sovereignty to the People's Republic. Therefore, it is critical that the provisions in the Basic Law reflect the wishes of the Hong Kong people and carry forward the changes that we plan to make before 1997.

Mr. Ian Taylor (Esher)

I have listened carefully to my hon. Friend. Does he accept that even the leading Chinese negotiator on the draft Basic Law has said that he will look carefully at all its aspects? Should the Government not therefore push as hard as possible to ensure that the Chinese are prepared to accept a faster pace towards democracy?

Mr. Eggar

I am sorry that my hon. Friend has misunderstood me. Naturally, we shall pay the closest attention to opinion in Hong Kong. Once it has crystallised, we shall press within the framework of the Basic Law for the correct outcome and marry the Basic Law with that opinion.

Dr. Bray

Will the Minister confirm that, until 1997, the constitution and administration of Hong Kong are the responsibility of the British Government? It will then be for China to adapt to the circumstances when it takes over in 1997.

Mr. Eggar

I agree completely with the hon. Gentleman. I wish to make it clear that we want to understand exactly how the people of Hong Kong feel on this critical issue. Once that view has crystallised, I can assure the hon. Gentleman that we shall fight hard for their interests within the Basic Law.

Many hon. Members have commented on the right of abode. As my right hon. and learned Friend has made clear, there is simply no way that the British Government could grant several million people the right to come and live in Britain. Such a massive immigration commitment is equivalent to about 6 per cent. of our population. It would be wholly impractical; the Select Committee on Foreign Affairs agreed with that in its recent report.

It is more than impractical—it is wrong—to hold out the promise of an insurance policy in the knowledge that a future British Government could not possibly deliver. To do so would he a cruel deception. That having been said, however, the Government are looking as a matter of urgency at what can be done to meet the concerns of the people of Hong Kong, as my right hon. and learned Friend the Foreign Secretary explained in his opening speech.

The scheme that we envisage will not apply solely to the rich and powerful, but will take account of factors such as the value of service to Hong Kong. Our aim is to encourage people from both the public and the private sectors whose skills are essential to Hong Kong's continued success to remain in Hong Kong, thus benefiting it between now and 1997.

Hon. Members have rightly emphasised the importance of the international dimension in seeking to give secure assurances for all the people of Hong Kong. It is clear that it would simply not be a practical possibility for Britain to provide such assurances alone. That is why we shall look for support to our friends and partners, who can help to reinforce confidence now by acknowledging that, if the worst comes to the worst, they have a responsibility to help. We have already begun discussions with our partners in Europe, the United States and the Commonwealth, and we intend to continue them vigorously at the Paris summit, at the Commonwealth Heads of Government meetings and at subsequent international meetings.

For us, Hong Kong's future is a top priority. Many hon. Members have commented on recent events and on the repression in China. About a week ago, we took the opportunity to raise China's human rights record at a meeting of the United Nations economic and social council, and we shall be working unremittingly to ensure that China's leaders understand fully how much world opinion condemns their appalling actions. They should also realise that continued repression will inhibit the progress of economic reform to which they say that they are committed, and which is so important to the future of their country.

We do not intend to isolate China. I can assure hon. Members on both sides of the House who have urged me to do so that my right hon. and learned Friend will take whatever opportunities occur to meet his opposite lumber in China to put across the specific anxieties expressed today.

Today's debate is being followed closely in Hong Kong. The people are anxious for reassurance. That is why my right hon. and learned Friend went to Hong Kong: to hear the territory's concerns at first hand and to make it clear that Britain has not wavered, and will not waver, in her commitment to the people of Hong Kong. We are honest and honourable enough to acknowledge that there are assurances that we cannot provide, and limits to what we can do. That is inevitable: it follows from the Joint Declaration and from Hong Kong's historical and geographical position. As the House recognises, we are not free agents in the matter of Hong Kong's destiny, any more than are the people of Hong Kong themselves. That may be a painful reality, but it is a reality nevertheless, and we in the House and the people of Hong Kong must accept it.

The Government are not about to cut loose from Hong Kong. We are not going to leave its people to an uncertain future. As a physical manifestation of that continued commitment, we are already planning for a large and prominent consulate-general, as was requested by the Select Committee on Foreign Affairs. Britain will be fully engaged at every stage in the establishment of an arrangement that will ensure the continuity of Hong Kong's way of life after 1997, a way of life that has provided the basis for a remarkable success story—

Mr. James Wallace (Orkney and Shetland)

rose in his place and claimed to move, That the Question be now put.

Question put, That the Question be now put:—

The House divided: Ayes 19, Noes 0.

Division No. 298]	[10 pm
AYES
Ashdown, Rt Hon Paddy	Livsey, Richard
Bruce, Malcolm (Gordon)	Maclennan, Robert
Campbell, Menzies (Fife NE)	Madden, Max
Canavan, Dennis	Michie, Mrs Ray (Arg'l & Bute)
Carlile, Alex (Mont'g)	Sillars, Jim
Fearn, Ronald	Steel, Rt Hon David
Grant, Bernie (Tottenham)	Taylor, Matthew (Truro)
Howells, Geraint
Hughes, Simon (Southwark)	Tellers for the Ayes:
Johnston, Sir Russell	Mr. James Wallace and
Kennedy, Charles	Mr. Archy Kirkwood.
Lamond, James
NOES
Nil
Tellers for the Noes:
Mr. Tony Durant and
Mr. John M. Taylor.

It appearing on the report of the Division that forty Members were not present, MR. DEPUTY SPEAKER declared that the Question was not decided in the affirmative.

It being after Ten o'clock, the motion for the Adjournment of the House lapsed, without Question put.