Commons Sitting of 19 June 1995

Preamble
The House met at half-past Two o'clock
PRAYERS
[MADAM SPEAKER in the Chair]
Oral Answers to Questions
  SOCIAL SECURITY

    Disabled People
    Mr. Evennett: To ask the Secretary of State for Social Security what action his Department is taking to tackle discrimination against disabled people; and if he will make a statement.[27598]
    The Minister for Social Security and Disabled People (Mr. William Hague): The Government's Disability Discrimination Bill will provide effective protection for disabled people against discrimination in employment, access to goods, services and premises, transport and education. The Bill, unrivalled in the history of Government provision for disabled people, has already received the approval of the House and is currently being considered in another place.
    Mr. Evennett: I thank my hon. Friend for that reply and congratulate him and his Department on their excellent work in this field. Does he agree that education is important in raising public awareness? Furthermore, many public body facilities, such as the British Rail station at Erith, at which it is impossible for disabled people to get on to the London-bound platform, have to
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    be brought into line. Public bodies must provide access for disabled people to railway stations, and Erith station must be one of the first to have such provision.
    Mr. Hague: My hon. Friend is right to draw attention to the continuing importance of education and persuasion. Even after the Disability Discrimination Bill becomes law, it will be important for people in all political parties to join together and lead the nation in showing why it is important to combat discrimination against disabled people. My hon. Friend is also right to draw attention to the difficulties that disabled people often face when using public transport. I assure him that the transport infrastructure will be covered by the Bill, which will also contain the power to set minimum access standards for public transport vehicles.
    Mr. Barnes: The unrivalled Bill on disability is not that of the Government but the Civil Rights (Disabled Persons) Bill, which has had solid support in the House. Will the Government at least seriously consider introducing a disability rights commission, in line with that proposed in the Civil Rights (Disabled Persons) Bill, through their measure? That would start to turn it into far more reasonable legislation and give all disabled people hope for the future because, in time, that commission would see that the Government's Bill was brought into line with the principles in the Civil Rights (Disabled Persons) Bill.
    Mr. Hague: The hon. Gentleman's Bill—he knows my view on it after our eight Committee sittings—is confusing, unfair and inflexible. The Government measure is clear and fair to others, and it will command the support of the nation in bringing discrimination against disabled people to an end.
    Mr. Tredinnick: Can my hon. Friend confirm that the Disability Discrimination Bill, which is in another place, will do much for schoolchildren? Does he agree that it will oblige education providers to make special provision for disabled people at school and university?
    Mr. Hague: Yes. The Bill will strengthen the Education Act 1993 by further improving provision for disabled pupils. In addition, the Government have announced a new £10 million fund for education providers to improve physical accessibility at schools.

    Mortgage Interest
    Mrs. Liddell: To ask the Secretary of State for Social Security what estimate he has made of the effect of his proposals to alter the present system of help with mortgage interest payments under income support on the number of repossessions. [27600]
    The Secretary of State for Social Security (Mr. Peter Lilley): Current income support provision is costly yet fails to cover the majority of people who fall into difficulty with their mortgage payments. The new proposals encourage the provision of comprehensive, high-quality mortgage protection for all new home owners should they suffer a loss of income. This should help to reduce the number of repossessions.
    Mrs. Liddell: The Secretary of State is being most unreasonable in this matter. Does he agree with the Council of Mortgage Lenders and the Association of British Insurers, which have already pointed to the likely dramatic increase in repossessions? If he is not prepared to listen to the common sense of Opposition Members who are concerned about repossessions, will he at least respond to the fear on his Back Benches about the consequences of these moves for those who are already suffering the effects of negative equity?
    Mr. Lilley: The hon. Lady is entirely mistaken. The Association of British Insurers has said the complete opposite of what she has said. It has said that virtually everybody who can obtain a mortgage should be able to obtain insurance. As a result, there should in due course be a reduction in repossessions and in the number of people who fall into arrears.
    Mrs. Roe: Is my right hon. Friend aware that, according to a recent survey in the Mortgage Finance Gazette, two thirds of the building societies polled said that they are planning to provide block insurance for their members and that 60 per cent. of those will provide it free? Does that not show that it is not only the Skipton building society but also many others that are likely to provide free unemployment insurance cover for their borrowers?
    Mr. Lilley: My hon. Friend is absolutely right. It was very interesting to see the reaction of the Labour Benches when the survey and the news which it brought forward were brought to their attention. They were shocked at the good news, because what is good news for home owners is bad news for Labour.
    Ms Lynne: Does the Secretary of State not understand that there is genuine concern that those who have been encouraged to buy their homes could, because of the cut in income support for mortgage benefit, face homelessness? Can the Secretary of State tell the House whether he has fully thought through all the implications of the policy? Whatever he says at the Dispatch Box, I do not think that he has.
    Mr. Lilley: I can, of course, give the hon. Lady that assurance. We are consulting about it with the help of the Social Security Advisory Committee. We have had a very
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    good response from the insurers, and the evidence is that the building societies will follow the excellent example set by the Skipton building society. However, I find it a bit rich for the sole representative of the Liberal party here present to pose as being interested in home owners when her party is actively contemplating abolishing mortgage interest tax relief.
    Mr. Congdon: May I congratulate my right hon. Friend on his determination to reduce the £90 billion a year spent on social security? Is it not right that those who are acquiring an asset that they will use and benefit from for their lifetimes should contribute towards insuring it rather than expect other taxpayers to bail them out?
    Mr. Lilley: It is certainly absolutely right that we should try to move from a system which, at present, leaves 70 per cent. of people with mortgages, who may find themselves unemployed or without an income, uncovered by the existing state system to one where all new home owners have protection and cover against the risk of losing their jobs. The extraordinary complacency of the Labour party, which had a debate on the subject and revealed that it had no policy to help those 70 per cent. will, I think, be recognised as a letdown to home owners.
    Mr. Dewar: Does the Secretary of State hold to the estimate—rather optimistic, I fear—referred to by the hon. Member for Broxbourne (Mrs. Roe) that a minimum of 40 per cent. of home owners will have to meet a significant additional cost to have insurance cover in the private market? Does he endorse that estimate? Has he noted the rather endearing, touchingly loyal, advice from the Secretary of State for Employment that the problem for the Tory party will be solved if it pulls up its socks? Would not dropping a plan for mortgage interest payments, which would add greatly to the uncertainty in the housing market, be an absolutely excellent contribution to that rather odd exercise?
    Mr. Lilley: The hon. Gentleman, who had the opportunity to tell us what Labour party policy is, tacitly criticises us because there may be some small cost to 40 per cent. of home owners in getting the protection that everybody believes they should have when taking out a new mortgage, and ignores the fact that his party proposes to leave 70 per cent. of them without any cover at all. The other day, he disowned his party's housing spokesman, who had at least offered to do something for that 70 per cent., but at the expense of abolishing mortgage interest tax relief.
    Mr. Peter Bottomley: Does my right hon. Friend agree that it is good to see a split among the members of the Council of Mortgage Lenders, and that those building societies that remain neutral look as though they have an interest in trying to help people not only to buy homes but to keep them after they have contracted to buy them, and that that example should be followed, not criticised, by the banks?
    Mr. Lilley: I am not one to rejoice in splits in any direction. I thought the correspondence from the chairman of Skipton building society was very interesting. In one respect, he is in agreement with the chairman of the Cheltenham and Gloucester, who himself a little while ago said there was no need for building societies to raise interest rates—which they did—because there was an

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    ample profit level. That means that they will have the means to provide cover without undue cost to home owners.

    Absent Parents
    Mr. Gunnell: To ask the Secretary of State for Social Security what measures he has taken in respect of those absent parents who as well as contributing to the upkeep of their absent children have negative equity in the housing they occupy. [27601]
    The Parliamentary Under-Secretary of State for Social Security (Mr. Alistair Burt): The vast majority of absent parents have their housing costs taken fully into account under existing child support rules. The problem of negative equity may affect parents other than those who have separated but we have no evidence of its being a significant problem in relation to child support.
    Mr. Gunnell: Will the Minister bear in mind the fact that financial tensions often give rise to marital tensions? Would he have a different answer if he were considering the specific case of a person whose negative equity was in the original family home and who, when that home was sold, crystallised that equity as a debt and is now paying that debt on behalf of himself and his former partner? Would that payment be taken into account in assessing his contribution to a CSA payment?
    Mr. Burt: The hon. Gentleman has written to me about those circumstances; a reply is being signed and will be waiting for him after Question Time. The circumstances that he describes are slightly unusual because, in most cases where there is negative equity, the property would not be sold and one party would remain in it. In that case, there would be extensive protection. In the circumstances that the hon. Gentleman describes, the debt would not be a housing cost as such. It could, however, be construed as a debt of the relationship. As the hon. Gentleman is aware, the Child Support Bill that is currently going through Parliament will provide the opportunity to consider such debts as a departure from the maintenance formula.
    Dr. Spink: Will my hon. Friend stay true to the principle that parents are financially responsible for their children and that that responsibility comes before almost every other responsibility unless the parents do not have the financial wherewithal, in which case the state should step in? Will my hon. Friend take all possible steps to ensure that the parent with care and control of the child receives a reasonable sum from the absent parent, who is often using every possible means to avoid paying for the child that he has left behind?
    Mr. Burt: Yes. I am grateful for my hon. Friend's comments. He is right to say that the principle that parents should maintain their children rather than leave it to the taxpayer to do so is at the heart of the Child Support Agency. It is not often realised that more than 70 per cent. of absent parents who have been asked to pay by the agency this year were not previously paying any regular maintenance. Given that 95 per cent. of parents with care exist on benefits, it is time that people appreciated that there is another side to the child support story. I am grateful to my hon. Friend for putting it so clearly.

    State Pension
    Mr. Winnick: To ask the Secretary of State for Social Security what recent representations he has received over the state pension. [27604]
    The Parliamentary Under-Secretary of State for Social Security (Mr. James Arbuthnot): Since the beginning of this year, Ministers have received a number of pieces of correspondence from organisations, Members of Parliament and members of the public, covering all aspects of policy on the state pension.
    Mr. Winnick: I am not sure what the Minister means by "pieces of correspondence", if I heard the phrase correctly. Is he aware that the National Pensioners Convention, which represents many organisations for retired people, was deeply disappointed by the response that it received from Ministers, including him? Is he further aware that millions of pensioners who are living in or near poverty believe, with justification, that they have been swindled by the Government during the past 16 years? They could not care less who leads the Government; they want decent policies for pensioners, and they have every right to demand them.
    Mr. Arbuthnot: Under the Conservative Government, pensioners' incomes have increased almost as much every year as they did during the entire period of the previous Labour Government. I met representatives of the National Pensioners Convention in August last year. We had a constructive and helpful meeting, and I was left with no sense that they had the reaction that the hon. Gentleman describes.
    Mr. Jacques Arnold: Is not the whole point of the state pension that it is the foundation stone on which people provide for their old age? Is it not a fact that, under the Conservative Government, most people do not have to rely on the state pension as their sole income because more than 20 million people are now members of occupational pension schemes and can look forward to a far better old age than would have been provided by the Government supported by the hon. Member for Walsall, North (Mr. Winnick)?
    Mr. Arbuthnot: My hon. Friend is right. He has concentrated on people at the upper end of the income range. They are important, but it is also interesting to note that the proportion of pensioners in the bottom decile has fallen dramatically under this Government. In 1979, 31 per cent. of pensioners were in the bottom decile; now, 9 per cent. of them are in the bottom decile after housing costs—an important improvement.
    Mr. Ingram: Does the Minister agree with the assessment made in December 1993 by the then Chief Secretary to the Treasury, the right hon. Member for Enfield, Southgate (Mr. Portillo), that the value of a state pension scheme under current Government policy would be worth a nugatory amount in the coming century? Coupled with the massive reduction announced by the Government in state earnings-related pension scheme entitlement, does that not show that the Government are prepared to increase pensioner poverty, in addition to the 1.5 million pensioners who already receive income support?
    Mr. Arbuthnot: I am a little surprised at the hon. Gentleman. First, my right hon. Friend did not say that. Secondly, our policy is to ensure that the state retirement

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    pension remains the bedrock of pensioners' incomes and that it will be increased in terms of prices year by year. If the state retirement pension becomes a smaller proportion of pensioners' incomes, it is because, under the prosperity introduced by the Government, their other income is growing so fast. That is why pensioners' incomes have gone up by more than those of the rest of the country as a group.
    Mr. John Marshall: Will my hon. Friend join me in congratulating John Cuckney on the award given to him in the recent honours list? Does my hon. Friend agree that that is a suitable reward for the man who rescued the Maxwell pension fund? Does he also agree that pensions in this country are better funded for the next century than are those anywhere in the continent of Europe, due to the importance of our occupational pension schemes?
    Mr. Arbuthnot: My hon. Friend is right. I and, I am sure, the entire House would wish to pay particular tribute to Sir John, now Lord, Cuckney for his amazing achievement in making secure the future of Maxwell pensioners. I should like to put on record my gratitude, and that of the entire House, to Lord Cuckney.

    Arcola Street Social Security Office
    Ms Abbott: To ask the Secretary of State for Social Security what plans he has to visit Arcola street social security office to discuss the payment of benefits. [27605]
    The Parliamentary Under-Secretary of State for Social Security (Mr. Roger Evans): My right hon. Friend has no immediate plans to do so.
    Ms Abbott: Is the Minister aware of the recent Public Accounts Committee report which revealed that the benefits of 266,000 claimants, out of a total of 5 million, were underpaid to the tune of £76 million? What will he do to ensure that the Benefits Agency does not penalise the poorest in our society by that sort of inefficiency, and when will he make the actual take-up of benefits a target for the Benefits Agency?
    Mr. Evans: Ministers are of course aware of the Public Accounts Committee report. The Arcola street social security office has met all the main targets apart from, as the hon. Lady very properly mentions, those on income support accuracy. Our principal difficulty with income support accuracy statistics involves the issue of mortgage interest rates and their variation. That is why, with the agreement of those involved, we are introducing a standard rate that will be simpler to administer and that will lead to a much more satisfactory position.

    Family Policy
    Mr. Soley: To ask the Secretary of State for Social Security which minister is responsible for the co-ordination of family policy within his Department. [27606]
    Mr. Burt: Although overall policy co-ordination is, of course, the responsibility of the Secretary of State, I have responsibility for responding on general family issues in the Department.
    Mr. Soley: Is the Minister aware that almost everyone outside the House who is concerned about family policy and the enormous impact that it could have on the welfare of our society, if we got it right, take the view that the
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    Government do not have a real family policy and that there is virtually no effective co-ordination between Departments? If he believes that that is not correct, will he put out a statement saying who is responsible for what and what is the structure of co-ordination?
    Mr. Burt: I do not accept the hon. Gentleman's point. Just about every Government Department handles policies that are of direct relevance to families, and individual Departments work closely together on matters that are common to them. A number of regular meetings to consider issues that impact on the family are held through, for example, the ministerial committee on home affairs and the ministerial sub-committee on women's issues. The whole of Whitehall is concerned about co-ordination of those policies. Such co-ordination does take place. The hon. Gentleman's plea for greater co-ordination is not falling on deaf ears. The work of each Department is complex and involves families in many different ways. The work is going on, even though the hon. Gentleman is not prepared to accept it.
    Mr. Harry Greenway: Does my hon. Friend agree with Cardinal Hume that the nuclear family is the bedrock of our society? Although a family who are unfortunate enough not to have both parents must be given help, basically we are aiming, as a party and as a Government, to support the family, and that is the right aim to have.
    Mr. Burt: I agree with my hon. Friend. The family is an integral part of the United Kingdom. We spend a lot of time concentrating on the income that goes into families, but we have spent rather too little time considering the structure of families and the damage that has been done over the past 20 or 30 years, with the changing structure of families and the pressure that is put on the relationships that keep families together. Anything that can focus both the mind of the House and the mind of the public at large on the importance of those relationships and the importance of families is a good thing. I wish that the ideal of a particular family type—that is, marriage—as the best basis for raising children would also be in the mind of the Church of England as it considers its conclusions to its report.
    Mrs. Dunwoody: Then perhaps the Minister would like to consider the position of families, many of them old-age pensioner couples, who find themselves required to find extra money for their own parents because of the Government's policy of moving an increasing number of geriatric patients out of the health service and dumping them in the community without proper support. What kind of family policy is that, pray?
    Mr. Burt: If I remember rightly, the change to community care was welcomed by the vast majority of local authorities, which competed keenly with Government to get the responsibility to look after elderly people. Substantial Government money has been put in to ensure that local authorities live up to those obligations; in many cases, they do.

    Fraud
    Mr. Lidington: To ask the Secretary of State for Social Security what steps his Department is taking to reduce social security fraud. [27607]
    Mr. Lilley: My Department has been developing a comprehensive strategy to combat fraud, moving from reliance primarily on detection to a much greater reliance on prevention and deterrence. It is devoting increasing resources to achieving this end.
    Mr. Lidington: Does my right hon. Friend agree that, with social security expenditure now by far the largest component of all Government expenditure, it is doubly important to maintain public confidence in the system by ensuring that every possible measure is taken to reduce and to prevent fraud? Will my right hon. Friend use the opportunities presented by new information technology to carry forward the struggle to prevent and deter fraud?
    Mr. Lilley: I can assent to both my hon. Friend's propositions. Fraud is a matter that gives rise to great public concern, and it is right that we should do all in our power to combat it. That undoubtedly means taking advantage of modern information technology and data-matching processes, which is part of my strategy.
    Mr. Frank Field: Will the Secretary of State confirm that about 10 million additional national insurance numbers that are not attached to individuals are floating around the system and that, last year, 30 million national insurance accounts neither had contributions paid to them nor credits made to them? Does he accept that, with a social security budget of £90 billion, it would be inconceivable, in view of what we know about City fraud and financial fraud, for there not to be the most sophisticated gangs operating against the social security budget? What action does the Secretary of State intend to take to protect that part of the budget, and how does he answer the charge that, in this most important of areas, he is soft on fraud and soft on causes?
    Mr. Lilley: The hon. Gentleman is probably the only person who thinks that I am soft on fraud. If I am honest, he is the only Labour Member who is not soft on fraud. None the less, he should not give the impression that national insurance numbers are "floating around", as he put it, because of fraud. There are national insurance numbers that no longer have people in this country attached to them simply because the people concerned are abroad. In other cases, there is a period of some months after death before probate is got through, so the number exists in the meantime. We want to tighten up on this issue so that we can make better use of national insurance numbers to combat fraud. The phenomenon to which the hon. Gentleman refers is not the result of fraud.

    Incapacity Benefit
    Lady Olga Maitland: To ask the Secretary of State for Social Security what representations he has had with regard to the incapacity benefit. [27609]
    Mr. Hague: I have received a number of letters about incapacity benefit. This major reform was introduced because, when the nation's health was improving, the number of people claiming invalidity benefit doubled.
    Lady Olga Maitland: I thank my hon. Friend for that reply. Will he confirm that, last year, the Government spent £7 billion on invalidity benefit—more than the total sum spent on further and higher education? Will he therefore join me in welcoming the new incapacity
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    benefit, which will control that spending and ensure that only those who are genuinely incapable of working will receive benefit?
    Mr. Hague: My hon. Friend is right. Reform of the system was vital to ensure that benefit went to the people that it was intended for. Without that reform, expenditure would have grown at an unsustainable rate. That is the reality that the Government have faced up to and which the Opposition are unwilling to confront.
    Ms Eagle: Will the Minister comment on the distress that some of the questions on the incapacity benefit form are causing my constituents and many other people, especially questions such as "Does your bladder work?" for which they are asked to tick the yes or no box? Those who drew up the questionnaire did not even have the decency to put "Private and Confidential" on the top. My constituents are having to answer questions on things about which they feel embarrassed, knowing that there is not even any confidentiality in the processing of the form. Will the Minister reconsider the design of the form to take account of some of those difficulties?
    Mr. Hague: The hon. Lady must recognise that the form is an opportunity for individuals to express their opinion about whether they are incapable of work and to give their own account of the difficulties that they face and any conditions that they have. Many of them will also have a medical examination to make a further assessment and many of them will find that their GPs are asked for their opinions. The hon. Lady would be the first to come to the House and complain if we did not ask individuals for their opinions. The information is not publicly available. There is no question of distributing such information in the public domain; she need have no worries about its confidentiality.
    Mr. Luff: On the subject of the medical test, will my hon. Friend confirm that many GPs will welcome these changes? They will no longer have to act as gatekeepers for long-term incapacity benefit, a role which many of them greatly disliked.
    Mr. Hague: My hon. Friend is right. Many GPs have welcomed the changes because, with the best will in the world, in the past, their decisions about benefit produced haphazard and inconsistent results. That was one of the principal problems with the old system, and we have removed it from the new system.
    Mr. Bradley: Has the Minister received representations from individuals who are terminally ill or from groups which represent them? I am sure that he remembers accepting the Labour amendment which will allow the higher rate of incapacity benefit to be paid to terminally ill people at 28 weeks instead of 52 weeks. Will he ensure that all the regulations allow for all linked benefits, including the Christmas bonus, to be paid to terminally ill people at 28 weeks instead of their having to wait for 52 weeks, so that they receive the maximum amount of benefits at the earliest possible opportunity?
    Mr. Hague: The hon. Gentleman knows that the exemptions from the test provide for people with severe conditions, which will include people who are terminally ill. If the hon. Gentleman thinks that any commitment that we have made is not being met, I will certainly look at it. At the moment, I am not aware of any such instances.

    National Insurance
    Mr. French: To ask the Secretary of State for Social Security when he proposes to meet the chief executive of the Contributions Agency to discuss national insurance contributions. [27610]
    Mr. Arbuthnot: My right hon. Friend the Secretary of State has regular meetings with Mrs. Faith Boardman, chief executive of the Contributions Agency, to discuss a wide range of issues.
    Mr. French: When my right hon. Friend next meets the chairman of the Contributions Agency, will he ask her why the tests to determine whether an individual is employed or self-employed are sometimes applied differently by the Contributions Agency and the Inland Revenue? Does he accept that the tests ought to start off being the same and be applied consistently? Unnecessary confusion arises when the Inland Revenue accepts individuals as being self-employed while the Contributions Agency says that they are employed. Will he bring measures to bear to ensure consistency?
    Mr. Arbuthnot: I have sympathy with my hon. Friend's question. My Department and the Inland Revenue have a common approach to employment status. Where one person is described as employed by one department, that judgment is normally accepted by the other department. That is intended to reduce burdens on businesses and on employees, and in almost every case it has that effect. If my hon. Friend would care to contact me about any individual cases that he might have in mind, I shall be pleased to take them up.
    Mr. Flynn: Why are the Government planning to reduce the value of employees' and employers' contributions from 18.25 per cent. of median wages to 14. per cent. in the next century, while allowing the value of the basic state pension to fall? The pension has already fallen from 20 per cent. of average male wages in 1979 to 15 per cent. now, and it will be 10 per cent. in 2020. Is that not an example of the Government trying to drive people into poor value private pensions and away from a good value national insurance scheme, the running costs of which are a mere 5 per cent.? In private pensions, the cost of administration, commissions and profit is 50 per cent. Is that not very poor value for future pensioners?
    Mr. Arbuthnot: No. Perhaps the hon. Gentleman was not listening to some of the answers that I gave earlier. The state pension, as a proportion of earnings, is falling because other people's earnings and occupational pensions are going up so fast. One of the reasons for the prosperity of this country is that so many people have opted out of the state earnings-related pension scheme into private, funded occupational pension schemes. The result of that is that we now have more money set aside in occupational pension schemes in this country than in the whole of the rest of the European Union put together. We are in a very good position indeed.

    Benefit Reductions
    Mr. Ainger: To ask the Secretary of State for Social Security how many claimants have had their benefit reduced as a result of adjudication officers ruling that they are not available for work because their homes are remote from work opportunities. [27612]
    Mr. Roger Evans: None in the terms of the question asked. Benefit can be refused if a person imposes restrictions on his or her availability for work and has no reasonable prospect of securing employment. That is a different situation from a person being in circumstances that impose their own restrictions. No one should be refused benefit purely on the grounds of where he or she lives.
    Mr. Ainger: That answer runs contrary to the evidence from my constituent in Rhosfach near Maenclochog, whose income support was suspended at the beginning of this year. The reason given in its evidence by the Department of Employment to the appeal tribunal was:
    "Unless she moves to a less remote area or obtains her own transport it is difficult to see what work she could take."
    That is contrary to what the Minister has just told the House. Is it not true that the way in which the rules are being applied discriminates against people in remote areas where there is virtually no public transport and against those who do not have their own personal transport?
    Mr. Evans: No. The rules have remained unchanged since 1955. I am aware of the case of another constituent of the hon. Gentleman, in respect of whom he has written to me. A review has taken place and it has been agreed that benefits should be payable. I have had no specific notice of the particular constituent whom the hon. Gentleman now mentions, but I can assure him that the guidance that has been issued to adjudicating officers has been clear and in the same terms for some considerable period. If people impose conditions, that is their own choice. If the adjudicating officer is satisfied that they have done so, there may be grounds for refusing benefit, but no one is to be denied benefit simply because he or she happens to live in a beautiful, rural and remote part of the hon. Gentleman's lovely constituency.
    Sir Donald Thompson: Will my hon. Friend ask the adjudicating officers to examine the case of two of my constituents who live in a beautiful part of Todmorden? They went to a remote area of the United States for 11 months and returned to find themselves totally out of benefit.
    Mr. Evans: As far as I can recall, my hon. Friend has not given me details of that particular case. It sounds as though the difficulty would seem to be the issue of habitual residence, which is a different matter.

    Old Age Pensions
    Mr. Skinner: To ask the Secretary of State for Social Security when he last met a group of pensioners' representatives to discuss the level of old age pensions and other entitlements. [27614]
    Mr. Arbuthnot: During the passage of the Pensions Bill, which is currently before the House, Ministers have had many meetings, both formal and informal, with pensioners' representatives and organisations.
    Mr. Skinner: Is it not a scandal that, at a time when pensioners have been robbed blind by the Government—they lost up to about £20 a week when the Government changed the system of paying pensions in relation to wages and prices—a few thousand Lloyd's names have been given £2.8 billion in tax relief? If as much as £2.8 billion is in the country, is it not high time for that money

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    to go to hard-pressed pensioners and not to Tory Back Benchers who have been saved from bankruptcy and financial ruin?
    Mr. Arbuthnot: As a Lloyd's name, I suppose I should declare an interest. As the hon. Gentleman is coming up to pension age, perhaps he, too, should declare his interest.
    I always enjoy the hon. Gentleman's contributions. On this occasion, as he mentioned wages and prices, he had the opportunity to set out whether it was Labour party policy to uprate pensions by prices or by wages.
    Mr. Skinner: It is mine.
    Mr. Arbuthnot: How reassuring for us.
    The Labour party has, however, produced no policy on that. It is not so much a pig in a poke as a porker in a pickle.

  PUBLIC ACCOUNTS COMMISSION

    Value-for-money Audits
    Mr. Cohen: To ask the Chairman of the Public Accounts Commission what funds will be provided to the National Audit Office for value-for-money audits. [27642]
    Sir Peter Hordern (representing the Public Accounts Commission): The net budget of the National Audit Office for 1995–96 is £37.6 million. That includes provision for both financial audit and value-for-money investigations. The Commission will meet on 4 July to consider the future expenditure of the NAO.
    Mr. Cohen: Is not the Government's incompetence becoming legendary—witness the fiasco at the weekend when tens of thousands of officially held documents were found? Is not such incompetence expensive for the taxpayer? The shadow Chief Secretary to the Treasury has produced a document entitled "Waste Watch", which shows that more than £21 billion has been wasted by the Government since 1989 on wrong priorities and ideological experiments. Is there not a case for more value-for-money audits—conducted sooner rather than later—so that Government incompetence can be exposed and prevented. That would put an end to such plain bad management.
    Sir Peter Hordern: The hon. Gentleman did not give me notice of his exact question, but I have read the document to which he referred. It is a rag-bag of some quite good points and some absolute rubbish, as one would expect from the Labour party. I had the good fortune to a member of the Public Accounts Commission during the previous Labour Government, under whom the omissions and faults were just as bad as they are under this Government.
    Mr. Campbell-Savours: The right hon. Gentleman is supposed to be neutral.
    Sir Peter Hordern: The hon. Member for Workington (Mr. Campbell-Savours) would bear witness to that record.
    Mr. Hawkins: Are there any plans to introduce value for money audits, supervised by the National Audit Office, of inefficient, wasteful Labour councils, such as Hackney, Islington and those in Lancashire?
    Sir Peter Hordern: No. Such work would be for the Audit Office, not the National Audit Office.

    Statisticians
    Mr. John Marshall: To ask the Chairman of the Public Accounts Commission what is the current number of statisticians employed by the National Audit Office. [27643]
    Sir Peter Hordern: The National Audit Office employs about 550 staff who either have accountancy qualifications or are training for them. Of those staff, 25 have degrees in statistics or mathematics. There are eight full-time professional statisticians or operational researchers. In addition, when specialist statistical advice is needed, the NAO uses external experts.
    Mr. Marshall: I thank my right hon. Friend for that answer. He is no doubt well aware of the difficulties that the NAO has experienced when dealing with the World Health Organisation. Would he like to comment on them and to offer any advice to the Government?
    Sir Peter Hordern: The House may be aware that the Comptroller and Auditor General thought it right not to carry on with his work as auditor of the World Health Organisation because it involved a most unsatisfactory process. The Comptroller and Auditor General has issued a statement, which I expect Members will have seen. The House and all subscribing countries owe a vote of thanks to the Comptroller and Auditor General for his hard work and assiduousness on behalf of all subscribing nations to the WHO.
    Mr. Campbell-Savours: Is the best way to deal with the problem simply to pull out? I have every respect for the Comptroller and Auditor General, but would it not be wiser to stay in, argue the issue publicly and secure reforms? At the moment, we have no guarantee that changes will be made to the process. May I suggest to the right hon. Gentleman that in his reply to me he freezes the political content that he used in answer to the question asked by my hon. Friend the Member for Leyton (Mr. Cohen), as he holds a non-political office?
    Sir Peter Hordern: I apologise most sincerely to the hon. Gentleman for offending his political sensibilities in any way. I understood that there was a hint of political content in the hon. Member for Leyton's question, and I hope that the hon. Member for Leyton did not mind the way in which I answered.
    In answer to the hon. Gentleman's question, I would say that—so far as I know—this country is still a subscribing member of the World Health Organisation.

  HOUSE OF COMMONS

    Hourly Wages
    Mr. Wicks: To ask the right hon. Member for Berwick-upon-Tweed, representing the House of Commons Commission, how many House of Commons employees employed directly or on contract, receive hourly wages of (a) £4 or less, (b) £3.50 or less and (c) £3 or less; and what is the lowest hourly rate for anyone working in the House of Commons. [27631]
    Mr. A. J. Beith (representing the House of Commons Commission): None of the staff employed by the House of Commons Commission is paid an hourly rate of less than £4. The minimum point on the salary scale of the

    15
    most junior grade equates to £4.39 per hour. Two staff in this grade are currently paid at that rate. The House authorities do not hold details of the wages of staff employed by contractors.
    Mr. Wicks: Is it not a disgrace that the House does not know the level of pay of staff employed by contractors? Is not that pay likely to be very low? Should not we satisfy ourselves from data that the people we employ are paid a fair wage, so that we are not an exploitative employer and the House of Commons is not a House of poverty?
    Mr. Beith: As I pointed out, the people whom we employ are paid a fair wage. The House uses contractors principally in the Parliamentary Works Directorate and the Refreshment Department, and usually has contracts with firms or agencies rather than with individuals. If the hon. Gentleman has evidence of low pay in those areas, he should draw it to my attention so that I may draw it to the attention of the Department concerned. The rates paid by the House to contractors take account of the prevailing rates of pay for the appropriate levels of skill for which the contract is made.
    Mr. Peter Bottomley: Does the right hon. Gentleman know whether the House of Commons Commission employs anyone below the ages of 18 or 19? He may discover that, as in some other public organisations, the rates of pay are high while the number of young people employed is nil.
    Mr. Beith: I would require notice of that question, but I shall obtain the information and let the hon. Gentleman have it.

  PUBLIC ACCOUNTS COMMISSION

    Expenditure
    Mr. Janner: To ask the Chairman of the Public Accounts Commission whether he will make a statement on the current year's expenditure of the National Audit Office. [27644]
    Sir Peter Hordern: The Public Accounts Commission approved the National Audit Office estimate of £37.6 million net for 1995–1996 on 6 December 1994.
    Mr. Janner: Will the Chairman tell the House how much of that expenditure goes towards producing the figures on unemployment, which nobody in the country believes to be anything other than fiddled? Will he consider whether the National Audit Office might not produce another set of figures to show how many people in this country want a job but cannot get one, because that is the real measure of joblessness in this land?
    Sir Peter Hordern: On the unemployment statistics, the hon. Gentleman may be referring to a report by the Royal Statistical Society, which is not a matter for either the National Audit Office or the Comptroller and Auditor General. The comptroller's job is to look into waste in Departments and value for money. The hon. Gentleman may care to put his question to the Secretary of State for Employment.

  SOCIAL SECURITY

    Pensioner Incomes
    Mr. Mark Robinson: To ask the Secretary of State for Social Security what has been the real average increase in pensioner household income since 1979; and what was the increase for the average household of the United Kingdom overall. [27617]
    Mr. Arbuthnot: Between 1979 and 1992–93, average household income rose by at least 43 per cent. for pensioners. During the same period, average household income in the United Kingdom rose by about 38 per cent.
    Mr. Robinson: I thank my hon. Friend for that answer. Does that not show that all pensioners are now better off in real terms than they were in 1979, thus giving the lie to some of the Labour party's claims?
    Mr. Arbuthnot: Yes, it does. It shows also the virtues of our pursuing funded occupational pension provision and other policies that have been dramatically successful in improving this country's economy.

    Mortgage Interest
    Mr. Pike: To ask the Secretary of State for Social Security what recent representations he has received regarding changes in benefit to meet mortgage interest payments. [27618]
    Mr. Roger Evans: A number.
    Mr. Pike: Does the Minister recognise that, despite what was said in response to questions earlier this afternoon, the only free thing about the Skipton building society is the free publicity that it is receiving from the Government in the form of answers to questions? Is it not true that the Government can no longer claim that they are the friend of the house owner when that house owner runs into difficulty?
    Mr. Evans: The answer to the last part of the hon. Gentleman's question is no. Far from receiving free publicity, the Skipton building society has behaved in a thoroughly responsible fashion.
    As a socialist, the hon. Gentleman might have bothered to notice that the margins of building societies and lenders are at an historic high of nearly 2 per cent. and that they are in a position to help their borrowers in times of adversity. The report by Special Risks Services showed clearly that many lenders will now introduce free insurance in such circumstances and that prudent lenders will do so universally.
    Mr. Dewar: As the Minister has praised the Skipton building society for its responsible approach to the problem, will he comment on its clear view that the Government have got it wrong and on its opposition to their plans?
    Mr. Evans: That is not so, as one can see if one reads all the statements of the Skipton building society. Ultimately, it will introduce the scheme and that is the important thing.

    Mortgage Interest
    Mr. Campbell-Savours: To ask the Secretary of State for Social Security what modifications he will

    17
    introduce to his proposals for paying mortgage interest in the light of the Loughborough university and Policy Studies Institute research into the housing market, commissioned by the Department of the Environment. [27624]
    Mr. Roger Evans: The research commissioned by the Department of the Environment was not directed specifically to the Government's income support mortgage interest proposals. The report confirmed that the majority of those who are affected by arrears and repossessions do not currently qualify for income support. Our proposals will encourage the development of comprehensive quality insurance, as I mentioned a moment ago, so that all new home owners should obtain proper protection if they suffer a loss of income.
    Mr. Campbell-Savours: Is it true that the report showed that two thirds of mortgage protection policies issued were invalid for reasons of exclusion? If so, is it not a remarkable statistic?
    Mr. Evans: It is a remarkable statistic, but the sample was 12. The Special Risks Services report showed that 75 per cent. of those involved in lending were surveyed not only about their intentions in respect of mortgage insurance, but also about the issue that the hon. Gentleman has raised. The Housing Finance Gazette of April 1995 stated:
    "One of the most unexpected results of the survey was the satisfaction with the claims service. The evidence, mostly anecdotal, from newspaper articles complaining about the claims service on creditor is largely unsupported by these figures."
    The lender, as much as the borrower, has a vested interest in ensuring that quality insurance is in place to ensure that the borrower's obligations to the lender are met when the borrower falls into unemployment.
    Mr. McLoughlin: Will my hon. Friend confirm that the Conservative party is the party of home ownership, that it encourages and will continue to encourage home ownership, that it has enabled millions of people throughout the country to buy their own council homes and that we shall continue to encourage people who wish to buy their own homes?
    Mr. Evans: My hon. Friend puts four questions robustly. The answer to each is yes, and that historically is in stark contrast to the policies of the Labour party.

    Benefits
    Mr. Mackinlay: To ask the Secretary of State for Social Security by what machinery or method he obtains the views of recipients of social security benefits; and if he will make a statement. [27626]
    Mr. Hague: The Benefits Agency commissions an annual national customer survey, carried out by an independent external research contractor, to examine customer opinion of the service that it provides. The overall satisfaction rating for the 1994 survey was 83 per cent.
    In addition, all BA districts carry out local customer surveys, which focus on the difficulties encountered by customers. BA also holds a series of biannual meetings to provide organisations with an opportunity to discuss issues of concern to customers. The surveys are in accordance with citizens charter principles and the BA customer charter.
    Mr. Mackinlay: Is the Minister aware that pensioners will not consider an independent research company a proper way of sounding out individual views and frustrations, bearing in mind that married couples are losing some £20 a week due to the Government's meddling with the system of uprating pensions? Is it not time that the Government listened to pensioners, who feel frustrated by the level of their pensions and their lack of mobility on public transport? On the 50th anniversary of voting for a Labour Government and a welfare state, they see the great prize for which they fought and for which they voted in 1945 being eroded by the Government.
    Mr. Hague: Pensioners are included in the survey to which I referred, but in recent years they have benefited from the uprating of the pension in line with prices, the increased resources being given to the less well-off and oldest pensioners and the low inflation that the Government have delivered, in stark contrast to their predecessor.

  HOUSE OF COMMONS

    Business Questions
    Mr. Flynn: To ask the Lord President of the Council what percentage of requests for debate at business questions resulted in parliamentary debates. [27632]
    The Lord President of the Council and Leader of the House of Commons (Mr. Tony Newton): Representations at business questions are among a wide range of factors that influences the content and timing of the business of the House. In recent months, several debates have responded to such representations.
    Mr. Flynn: Unfortunately, the Leader of the House has not answered the question. Does he agree that most right hon. and hon. Members regard business questions as a valuable opportunity to raise matters that are not otherwise on the Order Paper, with no real expectation of securing a debate? Does he agree that the system of business questions is now a meaningless ritual and that we should replace it with the system used in many Parliaments around the world, such as India and the United States, where, with the agreement of the Speaker, Members can speak for one minute during a period of about 10 minutes every day and raise any subject? Does he agree that the system of business questions and points of order is now archaic, meaningless, time-wasting and inefficient?
    Mr. Newton: It is clear that, were any such opportunity to be created, the hon. Gentleman would almost immediately talk it out. Many of his suggestions are clearly for the Procedure Committee. It seems sensible that there should be a weekly business statement. How people choose to use it is a matter for them, under the rules laid down by you, Madam Speaker, but much ingenuity is undoubtedly used.
    Mr. Dykes: Contrary to the previous churlish and over-lengthy question, will my right hon. Friend accept the thanks of the House for being a fair-minded Leader of the House and providing opportunities for debates on many subjects? In the same constructive spirit, will he give a little more thought to having slightly more debates

    19
    on Europe on the Floor of the House, not just in Committee, so that we can debate the obvious merits of the single currency more often?
    Mr. Newton: On the latter part of my hon. Friend's question, on one recent occasion many members of the Select Committee on European Legislation found it useful to be able to question a Minister in a way that would not be possible on the Floor of the House. I agree entirely with the first part of my hon. Friend's question.

    Privy Council Office
    Mr. Mackinlay: To ask the Lord President of the Council if he will make a statement on the work of the Privy Council Office. [27633]
    Mr. Newton: The Privy Council Office acts as the secretariat to the Privy Council. Among other things, it considers applications for the granting or amendment of royal charters, scrutinises changes in the byelaws or statutes of chartered institutions and in the governing instruments of universities and colleges, and arranges a variety of Crown and Privy Council appointments. The Judicial Committee of the Privy Council is serviced by the Department, which also contains the central drugs co-ordinations unit.
    Mr. Mackinlay: Will the Lord President reflect on the fact that, had the Halifax summit occurred any time after the third week of July and before the third week of October, there would have been no statement in this House of Commons? If the BMARC affair had cropped up in that time, there would have been no debate here. Is it not time that this Parliament provided, at least in the first or second week of September, a period when we could have statements from Ministers and could probe the Executive? How is it that I can table parliamentary
    20
    questions in January, February and March but cannot get replies in July, August, September or October? It is time this Parliament had proper sittings in the autumn to allow for proper scrutiny.
    Mr. Newton: The hon. Gentleman's question is all very interesting, but it has absolutely nothing to do with the one that I was asked.

    Divisions
    Mr. Skinner: To ask the Lord President of the Council how many Divisions have taken place in the House since January; and what was the figure for a comparable period in 1994. [27634]
    Mr. Newton: The number of Divisions in the House for the period from Tuesday 10 January 1995 to Friday 9 June 1995 inclusive was 129. That period represented 90 sitting days. During the first 90 sitting days of 1994, covering the period from Tuesday 11 January 1994 to Thursday 26 May 1994 inclusive, there were 202 Divisions.
    Mr. Skinner: Does the Leader of the House agree that there has been a dramatic change since the Jopling proposals were introduced in the House? I could not for the life of me understand why Tory Back Benchers, almost certainly facing a Labour Government in the near future, would want to throw away the opportunity to oppose that Labour Government. Then I suddenly realised why: because most of them realise that there will be a Canadian whitewash, and they will not have jobs.
    Mr. Newton: An above-average amount of ingenuity is being shown this afternoon—quite apart from the first question. The principal reason for the figures that I have just given is likely not to have been the Jopling changes but the fact that the usual channels were not operating in the first half of last year.

Halifax Summit
3.31 pm
The Prime Minister (Mr. John Major): With permission, Madam Speaker, I should like to make a statement on the Halifax summit, which I attended with my right hon. Friend the Foreign Secretary, my right hon. and learned Friend the Chancellor of the Exchequer and my hon. Friend the Minister of State, Treasury. I have placed the communiqué and the chairman's statement in the Library of the House.
As last year, the summit was in two parts. We started with a G7 meeting focusing on economic matters and were then joined by President Yeltsin for a G8 meeting on wider political issues.
In the G7 countries, growth averaged 3 per cent. last year, with the United Kingdom growing somewhat faster. The issue of most concern is the continuing high level of unemployment, particularly in continental Europe. Unemployment, for example, across the western European states in the European Union is currently at 11 per cent. We are all agreed on the policies needed to tackle that. They are those set out in the G7 jobs conference last year and taken forward in the recent Organisation for Economic Co-operation and Development study: more flexible labour markets, deregulation and the scrapping of restrictive practices, and better training and education. Those are the policies being pursued by the Government of this country, which have led to unemployment falling by more than 600,000 in the past two years.
We agreed to hold another jobs conference in France next year to review progress on those issues. All countries will be represented by Finance and Employment Ministers, and further consideration will be given to including others, such as Education and Trade Ministers, as well.
Last year at Naples we agreed to conduct a review of international institutions. At Halifax we have drawn up a series of specific proposals to strengthen the Bretton Woods institutions and the United Nations.
We all agreed that the most effective way to tackle exchange rate instability is the pursuit of sensible economic policies domestically. Finance Ministers and central bank governors will maintain close co-operation on economic surveillance and on exchange markets. We also agreed on a range of measures to strengthen co-operation between the world's financial regulators and supervisors on such matters as prudential standards and transparency. Among the proposals for the international financial institutions, I would single out those aimed at improving the International Monetary Fund's early warning mechanisms and its ability to handle crises where prevention fails.
The summit also discussed the problems of poverty and sustainable development. We agreed in particular to encourage better use of all existing World bank and IMF resources to tackle the substantial burden of multilateral debt faced by some of the world's poorest countries. That is an area where the UK has taken the lead in pressing for action. All G7 countries have now agreed to explore the option of pledging some of the IMF's gold, and we and some others will continue to argue the case for modest outright sales of gold to help reduce the debt burden.
This year is the 50th anniversary of the United Nations. We all wish to see a strong and purposeful UN, able to play the full role envisaged under its charter. We agreed that
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reform is essential if the UN is to continue to meet the demands placed upon it. We have made a number of proposals for eliminating duplication and waste, and consolidating and streamlining the UN's economic and social bodies.
We shall be actively pursuing those proposals in partnership with the rest of the UN's membership, as decisions on them are not solely for the G7. We also recognised the need for the UN to be properly financed. All UN member states should meet their financial obligations and agree to reform the system of assessment.
The G7 gave a strong push to the next stage in liberalising world trade. There is unfinished business from the Uruguay round, as well as new areas to be tackled, including non-tariff barriers, investment and Government procurement.
We dealt with a number of other issues, including the environment, where we agreed on the need to review and, where appropriate, strengthen the commitments that we made at the 1992 Rio summit. We also discussed international crime, where the G8 has taken up our suggestion to establish a high-level group to look at existing arrangements for co-operation against crime and to make practical proposals to improve them.
President Yeltsin played a full part in the political discussions. He described the tragic consequences of the taking of hostages by Chechen guerrillas in Budyonnovsk. The crisis, which has claimed many lives, has taken a new turn today. The guerrillas are now reported to be leaving, by agreement, but with a large number of hostages as well as Russian deputies and journalists. I hope that there will be no further loss of innocent lives, but the wider problem of Chechnya remains. We urged President Yeltsin to do all that he could to find a political solution.
Terrorism has been a problem in many of our countries, and we agreed to set up a better system for exchanging information about terrorist incidents and methods of dealing with them. We also agreed to President Yeltsin's proposal to hold a special summit in Moscow next year to discuss a range of issues on civil nuclear safety.
On Bosnia, Security Council resolution 998 on the reinforcement of UN protection forces was adopted on 16 June. The summit supported the new rapid reaction force, which the UK and France have helped to establish. President Clinton said that he had not yet secured congressional approval for that force to be funded from UN assessments, but made it clear that he wanted the US to share in the financing.
Following new offensives in Bosnia, summit leaders called for an immediate moratorium on military operations so that political negotiations based on the contact group proposals could resume.
Over the past day, the remaining protection forces' hostages have been released and the level of fighting has decreased. There has so far been no significant change in the military situation as a result of the latest offensives, and we continue to believe that this question will not be solved militarily.
Bosnia clearly remains in a dangerous phase. Mr. Carl Bildt, the former Swedish Prime Minister, is about to begin his mission as the European Union's negotiator. He will do so with the strong support of all the eight summit nations.

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This was a summit that addressed a range of primarily long-term but in some instances short-term issues: growth and employment; the reform of international institutions; the debt problems of the poorest countries; pushing forward free trade; the conflict in Bosnia; and terrorism.
The people of Nova Scotia gave the summit a conspicuously warm welcome. That helped to make it a friendly and productive meeting without the over-elaborate formalities that have often characterised previous summits. That is something that I have pressed for for some time, and I hope that we can take the process forward even more next year.
Mr. Tony Blair: I broadly welcome the statement that the Prime Minister has just made. I shall deal with it briefly under four key headings: Bosnia; global finance; action on jobs and the environment; and other related matters.
On Bosnia, the Prime Minister knows that we support the deployment of the rapid reaction force. May I simply press him, though, on its role? Is the intention that it be limited mainly to the protection of UNPROFOR troops, or will it be more vigorous in implementing the UN mandate, for example, in trying to secure convoy routes or in the policing of safe areas? I add our regret that the United States Congress has not thought it right—yet, at any rate—to contribute to the funding of the force. Can the right hon. Gentleman say whether that is likely to change? Are there other measures with which the US is proposing to help?
Was it impressed on President Yeltsin in particular that continuing pressure on Serbia by Russia is essential to a solution in Bosnia? Did the Prime Minister make it clear to Mr. Yeltsin, as other leaders did, that our desire for him to act over Serbia, and our deploring of any acts of terrorism by Chechen guerrillas, does not mitigate our concern for minimum standards of proper conduct on all sides in the handling of the crisis in Chechnya?
On global finance, I regret that the Government's proposals on the use of gold sales to help the debtor nations did not find support. Does the Prime Minister agree with us that the summit was disappointingly empty of new measures to assist poverty in the poorer countries? Does he further agree that such measures are in the interests not just of those countries but of the wealthier nations, too?
It is clearly right, especially following the financial crisis in Mexico, that the IMF pays greater attention to the way in which a crisis is prevented rather than merely to the way in which it is resolved once it has happened. I therefore agree with the improvements that have been suggested to allow for a better early warning system where problems have arisen and with the key benchmarks agreed on the publication of economic and financial data, but does the Prime Minister accept that doubling the IMF's general arrangement to borrow, as has been agreed, to allow earlier intervention in an emergency, is sensible, but only if the other reforms that have been agreed and the tough conditions necessary are put in place?
I also welcome the increased emphasis on co-operation over banking regulation in the wake of Barings, but is not the central issue the revolution in the globalisation of the financial and currency markets, which now wield massive
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speculative power over the Governments of all countries and have the capacity seriously to disrupt economic progress?
Apart from the general words—[Interruption.] Conservative Members may find this a problem of no account at all—but that is hardly surprising—but I think that most sensible people do. Apart from the general words in the communiquéé, were there any specific proposals as to how the G7 countries—[nterruption.] I do not think that Conservative Members realise that the G7 summit specifically drew attention to those problems, and most sensible people would regard it as intelligent to ask questions of the Prime Minister on them.
Apart from the general words in the communiqué, were there any specific proposals as to how the G7 countries could promote the greater stability in the new financial world that they have asked for?
On jobs, without such stability, job prospects are much bleaker, and the Prime Minister will know that the G7 suggested, as well as the elimination of unnecessary regulation, a greater emphasis on investment in skills. Will he not therefore reconsider the irresponsible cut of around 20 per cent. in the Government's budget for training the long-term unemployed? Does he agree with the emphasis in the communiqué not just on jobs, but on jobs of quality that pay wages that allow people to enjoy decent living standards?
As for the environment and related matters, especially nuclear power, we welcome the statement on the environment and, in particular, the decommissioning of Chernobyl nuclear power station. But is the Prime Minister as sanguine as the G7 appears to be about the state of the other nuclear power stations in the former eastern bloc? The chairman's statement mentions the importance of bringing the chemical weapons convention into force at the earliest possible date; what are the Government's current plans for its ratification, and when can we expect legislation?
We also welcome the initiative on fighting international crime and terrorism. Does the Prime Minister agree that the global nature of organised crime today makes concerted action imperative? We also approve of the mention of the position of Mr. Salman Rushdie, and the support for him expressed at the summit.
Finally, may I make a point with which I am sure the Prime Minister will agree, although he may not say so? When he next represents our country at an international financial summit, will he do so without his efforts being overshadowed by undisciplined shenanigans on the Conservative Benches? In the end, the loser from such behaviour is not just the Conservative party, but Britain.
The Prime Minister: First, let me thank the Leader of the Opposition for the areas in which he supported the decisions and proposals that were made at the summit.
I shall take the right hon. Gentleman's questions in the order in which he raised them. He asked about Bosnia. The role of the rapid reaction corps is primarily to reinforce and protect, but it may well be operating in greater numbers in terms of some elements of convoy protection. For example, it will have much better equipment to remove mines. It is difficult not to give a misleading impression by saying that it is there to add muscle; it is emphatically not there to fight—that point should be clear—but the greater reinforcements and equipment will assist in ensuring that more convoys can

25
get through, because of the ability that they will have in greater numbers to deal with problems that are currently extremely difficult to overcome.
As for funding by Congress, President Clinton faces the difficulty that he needs the approval of Congress and at present does not have it. He wishes to pay, and he wishes to make it clear that the United States would wish to pay its equivalent to an assessed United Nations contribution towards the cost of the rapid reaction corps. He will be looking to see how that can be done. Moreover, around the table, every Head of Government agreed that, in the absence of an assessed contribution, they would themselves voluntarily pay the contribution that they would have paid under a system of assessed contributions.
The right hon. Gentleman asked about President Yeltsin's relationship with Serbia. President Yeltsin has repeatedly put pressure on President Milosevic; he did so most recently when I telephoned him with Chancellor Kohl from Germany when the present difficulties began. He reassured us yet again that he would continue to do so—although I think that the degree of pressure subsequently exerted by President Milosevic on Karadzic is a different matter, over which the Russian leader feels that he has less direct control.
The chairman's statement made clear the feelings of the G7 about Chechnya, the need for a political solution and the need to ensure proper standards in dealing with the conflict. President Yeltsin knows from what we have said on this and other occasions that we do not believe that it was handled in the most appropriate fashion.
As for finance, we would have preferred an outright sale of gold by the IMF to help to deal with the problems of the very poor nations. The intention, however, was never to sell the gold and use the proceeds, but to sell the gold, maintain the proceeds and use the interest to alleviate the debt of the poorest. I think that that can broadly be met by the pledge, although I share the right hon. Gentleman's view that the pledge is second best: we would have preferred the outright sale of gold, and we shall continue to press for it to assist those very poor nations.
I welcome the right hon. Gentleman's support on the IMF questions and agree that doubling the general arrangement to borrow is sensible, but that the other reforms need to be put in place. That point has been securely made. I also agree about the co-operation that is necessary to deal, in terms of IMF surveillance, with countries that are running into economic difficulties.
I now refer to speculative flows. Everyone is concerned about an element of speculation, although sometimes people confuse speculation, which does exist, with significant movements of large pension funds from one country to another. Those responsible for pension funds are sometimes under a statutory requirement to move funds if that is right and is thought to be in the interests of their pension holders. There is undoubtedly some speculation. The problem in dealing with it is that even the sum total of foreign exchange reserves of the world's seven largest industrial countries, whose representatives were seated around that table, would probably be less than the flow of foreign exchange through the New York exchanges on a single day.
The reality is that we are no longer in the circumstances that we may have been in 15 or 20 years ago to deal with open market operations on speculation. Frankly, it is no longer true and no one should harbour the belief that it
26
can be tackled in that fashion because the market is now much too big for the problem to be dealt with in that way. We looked at how best to deal with it and reached the unsurprising but, I think, sensible conclusion that the only way to deal with it is for countries not to place themselves in that position. They will not do that if they follow sensible economic policies, so that their currencies are not likely to become subject to speculation. I think that that was universally agreed around the table. There are areas in which there can be central bank co-operation, but we felt that they were very much on the margins of what could be achieved and that those achievements cannot be central because the market is too big.
On the environment and nuclear power, we welcomed the decommissioning of Chernobyl. I am sorry if the right hon. Gentleman thinks that the communiqué is sanguine on the eastern bloc problems. I do not think that that was the view of those who were present. Certainly, Chernobyl has caused great trouble, but there is a large number of unsafe nuclear establishments across eastern Europe. They have not become Chernobyls and we hope and pray that they never will, but judged by the safety standards that we wish, they are not safe. That is one of the reasons for not only the financial assistance that has previously been offered but the decision to hold a conference on civil nuclear safety in Russia in the first half of next year.
I cannot give the right hon. Gentleman a date on the chemical weapons convention, but I can tell him that we shall proceed to ratification as soon as we can. I am grateful to him for his support for the condemnation of Iran's fatwa on Salman Rushdie. On jobs, we agree about greater investment in the right sort of skills. We were looking at skills and education expenditure right across the board. In our view, it is a matter not just of more spending but of how existing resources were being used.
On jobs, we supported what was said by the Organisation for Economic Co-operation and Development, which made the position clear on the policies that it supported. The OECD also highlighted policies that it felt cost jobs. They included: high non-wage costs, artificial training levies and high minimum wages—all of which will be familiar to the right hon. Gentleman.
Sir Peter Hordern: My right hon. Friend said that the United States sanctioned the United Nations rapid reaction force, but is not prepared to pay for it. Is there some prospect of that being reversed, and does he agree that if it is not, there will be an unacceptable burden on ourselves and the French? Would reform of the IMF mean that we could avoid the problems that occurred when Mexico was bailed out by the United States and by the International Monetary Fund without, I understand, any consultations with those, including ourselves, who subscribe to the IMF?
The Prime Minister: In response to my right hon. Friend's first point, I hope very much that the President will be able to find a way of meeting what would otherwise be the assessed United Nations contribution of the United States. Whether the President will be able to change the present opposition by Senator Dole and Speaker Gingrich is not a matter that I can judge from here. I am in no doubt about the President's willingness to do that or to find some other way to meet that cost. If not, it will, of course, have to be met either by France and

27
Britain or by a voluntary settlement from other members of the G8 and other United Nations members. That also is a possibility; both possibilities exist.
One impetus for the reform of the IMF was, of course, the lack of proper surveillance that predated the problems with Mexico. The difficulties in Mexico should have been spotted earlier by the IMF, but they were not. The problems created a great deal of currency turbulence in central Europe and also played a material part in the rising level of the deutschmark against other European currencies. It is precisely for that reason—among others, but certainly for that reason—that we are looking at reform of the institutions.
Mr. Paddy Ashdown: I welcome the Government's proposals for the limited sale of gold to relieve the debt burden on third-world countries. I am sorry that they did not receive the full support that they deserved. May I assure the Prime Minister that if the Government continue to press those proposals, he will, I suspect, have the full support of all Opposition Members?
On currency speculation, the Prime Minister described very accurately both the scale of the problem and its danger. Have the Government given any thought to the proposals, which have been very well worked out over a number of years, that are being put forward by, among others, Professor Tobin for an international scheme for a low level of taxation of speculators in the spot markets in currency? Many believe that that would have a stabilising effect and it is well within the scope of the international institutions' power.
On Bosnia, the Prime Minister will no doubt understand why the very disappointing decision of the Americans not to fund the rapid reaction force at the moment will be regarded by many as yet another example in the long chapter of disorganisation, disarray and disunity for which the UN, the Bosnians and our troops on the ground have paid such a price in the past. I would ask the Prime Minister one specific question. On Saturday, he said that, if the UN was forced to withdraw, the result would be a massacre. I believe that that calculation is correct. Does it not follow that if, against our will, the UN is forced to withdraw from Bosnia, it would be inconceivable to leave the Bosnian Government without the means of their own defence?
The Prime Minister: Again, let me take the right hon. Gentleman's points in order. On gold, yes, we shall continue to press and I shall be happy to have the right hon. Gentleman's support and that of other hon. Members. It is the right way forward. Pledging the gold will certainly make an improvement, but we think that outright sales of gold would have been better.
On speculation, we did not specifically refer to the Tobin proposals, but we did discuss matters such as the imposition of taxes and exchange controls. However, we agreed without dissent that either the reimposition of exchange controls or new taxes on financial transactions would be counterproductive. We did consider those proposals, but there was unanimous agreement among the G7 that that was not the direction in which we wished to go.
On Bosnia, I think that the first half of the right hon. Gentleman's remarks was inaccurate, in the sense that the responsibility for the fact that the United States is
28
unprepared to contribute lies not with the United Nations, the Bosnians or the American Administration, but with Congress itself. I very much hope that that will be able to be corrected. As I indicated to my right hon. Friend the Member for Horsham (Sir P. Hordern) a moment ago, we must wait and see whether that is the case.
I did say that, if the United Nations protection force were forced to withdraw, I feared that one of the outcomes would be a massacre. That is a position that I have held to for a long time; it is why I remain rigorously opposed to the withdrawal of the United Nations protection forces unless and until it becomes transparently clear that it is no longer safe or prudent for us to leave our troops there. So I very much wish them to remain. Were the United Nations protection force to leave, I think that it is very likely that the arms embargo would be lifted.
Several hon. Members rose—
Madam Speaker: Order. A number of right hon. and hon. Members are seeking to question the Prime Minister. I caution the House that now that we have heard from the two major Opposition parties, I am seeking one question each from Back Benchers to the Prime Minister; otherwise, there will be great disappointment. There may be disappointment in any event, but this is not a debate. It is one question to the Prime Minister, who, I am sure, will give a brisk answer.
Mr. David Shaw: My right hon. Friend will have met President Chirac at the conference, someone who has suffered a number of political disappointments in his political life, but who won through in the end. Perhaps my right hon. Friend had the opportunity to talk to President Chirac about reports last week that he criticised our overseas aid budget. Did my right hon. Friend have the opportunity to point out to him that Britain not only spends some £3 billion a year on overseas aid, but puts £3 billion into Europe, whereas France gets about £3 billion from Europe? Should—
Madam Speaker: Thank you. I meant it.
The Prime Minister: I did not spend any time discussing overseas aid with President Chirac. We had the opportunity to discuss that the week before, so we did not do so this weekend. I think that President Chirac knows and accepts that we have a very high-quality aid programme.
Mr. Tony Benn: Will the Prime Minister tell the House what representations were made to him about the decision to allow the Brent Spar oil rig to be ditched in the sea and what representations he and others made to the French about the resumption of nuclear testing, both of which run absolutely counter to the bland and meaningless words used in the communiqué about the environment?
The Prime Minister: I understand that many people seem deeply upset about the decision to dispose of Brent Spar in deep water. I believe that it is the right way to dispose of it. It will be disposed of in the Atlantic, in 6,000 ft of water. It is 150 yd tall and 30 yd wide, and the proposition that it could have been taken inshore to be disposed of is incredible. Shell has my full support to dispose of it in deep water. I made that clear to people in the discussions that I had over the weekend.
Sir Patrick Cormack: When my right hon. Friend and his colleagues made their understandable calls on Saturday for a cessation of hostilities in Bosnia, did they recognise the fact that any sovereign state has the right to defend its own capital city?
The Prime Minister: I think that that point was well understood, but I repeat that I do not believe that the matter is ever going to be solved on the battlefield in any remotely satisfactory way. That is why I believe that we must do all we can, as we have over the past three years, to try to seek a negotiated political settlement. It is bitterly disappointing that, time after time, one group or the other—it has not been one group alone—has stood in the way of a settlement when it looked as if we could get to serious talks.
All the main groups have stood in the way of that at some stage and, I believe, for different reasons. However, the sooner that every group realises that if it seeks to win on the battlefield it will be an international pariah for years, the better; the sooner other groups realise that the United States is not going to enter the war on the ground on one side, the better; and the sooner those two points are recognised by the different groups, the sooner we might get to some political negotiations that would realise a satisfactory settlement.
Mr. James Molyneaux: Given the vulnerability of modern society to terrorism and the certainty that terrorism will seek to dominate democracy in the next century, will the Prime Minister continue the good work that he did last week and strongly press his colleagues—the leaders of the other Governments—to arrange and establish workable and effective structures to co-operate against terrorism? Will he warn the other leaders that it would be completely futile if they were to make any concessions to terrorists, which would merely whet their appetite?
The Prime Minister: I share the right hon. Gentleman's views. We agreed to share information on major terrorist incidents and to strengthen co-operation in all aspects of counter-terrorism, including the research and development of methods to prevent and to deal with terrorist attacks. In our discussions, we attached special importance to measures to impede the ability of terrorist organisations to raise funds, without which, of course, they cannot purchase the weapons that they use against innocent citizenry. In order to carry matters forward, we asked a terrorism expert group to report on specific measures to deter, prevent and investigate terrorist acts, and we shall jointly consider that report when it is completed.
Sir Cranley Onslow: When my right hon. Friend says—and it is welcome news—that there are to be measures to improve international co-operation against terrorism, may I take it that that extends to crime in general and not just to terrorism in particular? If there is to be a better system and one that is more effective and secure than Interpol, will he tell us any more about how it is to be developed and who is to pay for it?
The Prime Minister: I can confirm that to my right hon. Friend. There are some further matters directly related to crime, again to strengthen the exchange of information and co-operation and to provide assistance to other nations in areas where drug-related crime, for
30
example, may find its roots. We are also seeking to co-operate, to stop criminals escaping justice by crossing borders—another matter that is long overdue, where more decisions are yet necessary and where discussions will take place to ensure that they are taken.
We should also like to encourage all Governments to adhere to the recommendations of the financial action task force to prevent money laundering. Clearly, money laundering takes place on a massive scale in different parts of the world. Often it is money laundering not just by individual criminals, but by organised, large-scale criminal groups in different parts of the world. We have established a group of senior experts to consider critically existing arrangements for co-operation and to report back to the next summit.
Mr. Peter Shore: Returning to nuclear matters, the Prime Minister touched on the business of nuclear safety at Chernobyl and elsewhere, but he made no mention of the French decision to resume nuclear testing in the Pacific. In the context of the advanced stage of the comprehensive test ban treaty negotiations, and taking account of the justifiable anger in New Zealand, Australia and other Pacific countries, what representations did the Prime Minister make to the French President and, if so, with what effect?
The Prime Minister: The question of French nuclear testing was not discussed bilaterally or in the discussions among the G7 or G8 at all. [HON. MEMBERS: "Why not?"] It was not discussed at all at the economic summit. The important international objective now is the early agreement of the comprehensive test ban treaty, and we all confirmed our commitment to that. The decision on the resumption of French nuclear testing is a matter for the French Government and they have taken that decision. The French have said that there would be a short series of tests, following which they proposed to adhere to the comprehensive test ban treaty. That is their position. It has been established and we accept it.
Mr. Roger Knapman: When discussing economic affairs, did my right hon. Friend and other leaders discuss the position in socialist Spain, which was recently obliged to increase its interest rates by 0.75 per cent. to meet convergence criteria—and that despite a 24 per cent. unemployment rate? Does not that show my right hon. Friend's wisdom in maintaining our opt-out from a single currency?
The Prime Minister: I agree with my hon. Friend about the wisdom of maintaining the opt-out. [HON. MEMBERS: "What a surprise."] I say to Opposition Members that it is no surprise that I agree with my hon. Friend on that particular opt-out, as I negotiated that particular opt-out and it would be extremely surprising if I did not agree with it. I must say to my hon. Friend, however, that, although it would have been tempting, we did not discuss the particular matter to which he referred in the first half of his question.
Mr. Dennis Skinner: How on earth can the Prime Minister come to the House of Commons and try to give the impression that he can resolve the problems on the world stage when he cannot sort out all the conflicting groups in his own party?
The Prime Minister: I have to say to the hon. Gentleman that his ingenuity knows no bounds, and that its irrelevance to the subject under discussion knows no bounds, either.
Mr. Michael Jopling: Leaving aside Bosnia, is the Prime Minister aware that there will be broad support for the agreement to try to find fairer ways of financing the overall budget of the United Nations? However, was there broad agreement among all the Heads of Government, including the Americans, that, given all the problems that we have in the world, the recent decisions by the United States Congress to cut United States contributions to the UN are both deplorable and, as the Minister of State, Foreign and Commonwealth Office told the House the other day, probably illegal?
The Prime Minister: Yes, we have discussed that matter. I share the view expressed on the subject by my right hon. and learned Friend the Minister of State just a few days ago. It is necessary, though, for us to reform the system of payments to the United Nations generally. The House will be interested to know that if the system is based on gross national product, it will not make any material difference to the British contribution. It would certainly reduce the American contribution and increase the contributions from Japan and Germany. There would be other changes as well, to reflect changing patterns of GNP over the years. For this country, the change would be marginal.
Mrs. Margaret Ewing: Will the Prime Minister confirm that the issue of Brent Spar was raised publicly as well as privately at the summit? Will he advise the House which, if any, other leaders agreed with the decision taken by Shell and the United Kingdom Government in favour of such a form of disposal? Will he advise us whether there is a financial interest for the Government, because some of the costs of disposal at sea can be offset against petroleum revenue tax? The costs cannot he offset if there is full disposal on land, which could actually create jobs and has been shown in the Smit report to be much cheaper.
The Prime Minister: The question of Brent Spar was not discussed among the G7 leaders. Chancellor Kohl and I spoke bilaterally about Brent Spar; he expressed one view and I expressed another. There were no public statements about the matter other than in response to questions asked of us by journalists. There were no public discussions.
On the disposal of Brent Spar, I repeat the point that I made a moment or śo ago. The right environmental way in which to dispose of Brent Spar is to drop it into 6,000 ft of water in the Atlantic. The hon. Lady seems to think that the platform should be taken ashore. If she thought that it was to be taken ashore in Scotland, she would think differently.
Sir Peter Tapsell: On the subject of global finance, may I put it to my right hon. Friend that the most immediate problem is not speculation, as stated by the leaders of the Labour and Liberal Democrat parties, but the continuing need of many Japanese institutions to repatriate, for purely commercial reasons, increasing quantities of their vast holdings of overseas assets, much of them held in liquid form? If that repatriation continues
32
at the rate of recent weeks and months, it will have the same impact on the world economy as did the oil hike of 1973–74. It could plunge the whole world, including this country, into another slump. Did the leaders of the G7 give any thought to international co-operation to deal with this problem of a recycling kind?
The Prime Minister: My hon. Friend touches on a problem of real severity as we look to the months that lie immediately ahead. There was some discussion of the problem at the G7 and there was some discussion about the desirability of increased demand within Japan itself. Those points were carefully noted by the Japanese Prime Minister.
Mr. Calum Macdonald: On the matter of Brent Spar, does the Prime Minister acknowledge that, once again, the reputation of the United Kingdom as the dirty man of Europe has been confirmed'? Will he confirm that it is technically possible to recycle Brent Spar on land, which would create more jobs, and that the only obstacle is that it would be more expensive for Shell?
The Prime Minister: The hon. Gentleman is quite wrong. I repeat that Brent Spar was not a subject of discussion at the G7 summit. The deep sea disposal of Brent Spar, first, is consistent with our international commitments, secondly, has been endorsed by the overwhelming majority of independent expert opinion received by the Government, thirdly, has received all the necessary approvals and consents and, fourthly, is the best practicable environmental option available to us. The hon. Gentleman would be wise to consider that.
In the context of the Government's general position on the environment, this country is, in many ways, far from fitting the hon. Gentleman's categorisation, which I do not recognise and which I think he should be ashamed of having uttered. He should be ashamed of having uttered it—[HON. MEMBERS: "Why?"] Because it is untrue. Not only is it untrue, but it is another illustration of the way in which Opposition Members always speak as ill as they can of this country and as well as they can of other countries.
The hon. Gentleman should look at the environmental record of other countries before criticising this country for its environmental record. Not many other countries are, like us, on target to exceed the Rio commitments on carbon dioxide emissions; we are. Not many other countries are contributing £90 million to the global environmental facility; we are. Not many other countries have made the contributions that we have to things such as the biodiversity convention. It would be very nice if, just for once, Opposition Members spoke well of this country and not ill.
Mr. Bernard Jenkin: Will my right hon. Friend confirm that it is in fact a matter of some pride for him to represent the economy in Europe that is leading Europe out of recession? Will he confirm that there was absolutely no interest in national minimum wages and increasing employers' costs, demonstrating that the ideas of the Leader of the Opposition are as irrelevant to the rest of the world as they are to the future of this country?
The Prime Minister: I can confirm that for my hon. Friend. There is no doubt that this country was well ahead in terms of growth as we emerged out of the recession

33
and that it still leads the rest of Europe in its growth, low inflation rate and fall in unemployment. On measures for further job stimulation, the G7 leaders endorsed the OECD report, which supported in terms the policies that we have been following and condemned in terms those advocated by the Opposition.
Mr. Andrew Faulds: As regards Brent Spar, which was raised by Chancellor Kohl in bilateral discussions, what contribution does Shell UK make to the Conservative party? If the Prime Minister does not like the question, why does he not publish the figures of funding for the Conservative party?
The Prime Minister: I repeat that Brent Spar was not a subject of the conference. [HON. MEMBERS: "How much?"] I have no idea whether Shell contributes. The hon. Gentleman may not know it, but the responsibility for the Conservative party's finances does not lie with the Prime Minister if he is a Conservative. It lies with the party machine itself and not with me. The answer to the hon. Gentleman is that I do not know whether Shell contributes. The reality is that, having sought advice on the best environmental method by which to dispose of Brent Spar, we have taken that advice.
Mr. Winston Churchill: Will my right hon. Friend convey to the President of the United States the regret of this House that the United States Congress, so free in giving its advice on Bosnia to those of us whose countries have for many years had forces serving in difficulty and danger in the Balkans, has thus far appeared unwilling to pay its contribution to the funding of the rapid reaction force?
The Prime Minister: I can say to my hon. Friend that I have already done so. I believe that the President regrets it as well.
Mr. Denis MacShane: On jobs, did the Prime Minister discuss with Chancellor Kohl the fact that the rate of decline of unemployment in Germany is now four or five times that in England? In other words, for every job that we are creating, the Germans are creating four under a partnership economy committed to the social charter.
The Prime Minister: I must say that the hon. Gentleman never ceases to amaze me with the nonsense that he talks. That is absolute rubbish from top to bottom. The reality is—[Interruption.] I am sorry that he does not like the reality. We have to live in the real world. He can live in his fantasy world if he likes. The reality is that this country has reduced unemployment by more than any other country in Europe. If he cares to look at the particular—[Interruption.] If he looks not just at Christian Democrat countries but at those socialist countries in Europe, he will see unemployment very much higher in those socialist countries, as it would be in Britain if the sort of policies that they have followed were followed here.
Mr. Iain Duncan Smith: Does my right hon. Friend agree that he went to the conference in a remarkably strong position, despite what the Opposition have said? He was the leader of a country with one of the lowest levels of unemployment, the lowest interest rates and lowest inflation. Does he not therefore agree that, despite what the Opposition say, the reality is that
34
speculation takes place on economies that are unsound, which is exactly what would happen were the Opposition to get into power?
The Prime Minister: My hon. Friend is quite right about the soundness of our economic recovery and the security of our economic recovery. That was well recognised by our partners at the summit.
Mr. Tony Banks: May I say that I can scarcely remember a day when such an important statement from the Prime Minister was greeted by so many empty Benches behind him? It must worry him as much as it intrigues us. To what extent did the questions that he had to face in Halifax about divisions in his party and the impending leadership challenge—
Madam Speaker: Order. That is totally irrelevant to the Prime Minister's statement. If the hon. Member has a question relating to the statement, of course he should put it. It must relate to the statement.
Mr. Banks: I was merely asking to what extent the questions that the right hon. Gentleman faced in Halifax distracted him from important considerations in Halifax.
The Prime Minister: To no extent whatever.
Mr. Jacques Arnold: Did my right hon. Friend notice the odd way in which the social costs of employment were jumped over by the Leader of the Opposition in his questions? Does my right hon. Friend think that our policies will be adopted by the right hon. Gentleman or that he was merely embarrassed?
The Prime Minister: I am not sure. Far be it from me to divine what was in the mind of the Leader of the Opposition. That is not a matter for me. I did notice that he did not touch on those particular points, but the right hon. Gentleman and I know that we have clear differences on the matter and that they are likely to continue in the future.
Ms Angela Eagle: The Prime Minister's answer on the failure of the summit to do anything about some of the difficulties of exchange rate instability assumed that the global financial markets were rational. Does the Prime Minister agree that global financial markets can be as irrational as the Conservative party when it contemplates leadership elections and stalking horses?.
The Prime Minister: What is irrational in the hon. Lady's question is the belief that exchange rate stability can be imposed when the flows over the New York exchange in a day probably equal the sum total of the foreign exchange reserves of all the seven countries that were at the summit. That is completely irrational, to the point of being economically dotty. The only way in which people will get exchange rate stability is by having underlying economic stability. That was accepted by all the seven Heads of Government who sat round the table at the G7 summit.
If the hon. Lady is indicating to me that it is now Labour party policy to try in some artificial way to sustain exchange rates with open market operations, I look forward at long last to a statement on policy from the shadow Chancellor on that issue, if on none other. He seems to have no policy on most issues. If he is being pressed by his Back Benchers on that issue, I am sure that

35
my right hon. and learned Friend the Chancellor will press him on whether that is indeed the principal Opposition party's policy.
Mr. John Wilkinson: To what extent does my right hon. Friend feel that the Group of Seven summit clarified the objectives to be given to the allied rapid reaction force? When he says that the force will not be there in order to fight, how will it be able to fulfil its mission of protecting the protection force of the United Nations if it is not permitted to take offensive action if necessary? Is the withdrawal of UNPROFOR from the weapons holding sites a precursor to a more passive role? Did Mr. Chrétien feel that Canada, which has troops in the theatre, ought to be represented on the contact group? Did the Dutch feel that they should be represented?
The Prime Minister: The latter point was not raised by Prime Minister Chrétien either in the G7 or in the bilateral meeting that I had with him. If he holds that view, it is not a matter that he raised with me. Certainly, the proposals do not indicate a more passive role for the United Nations protection forces. I was seeking to tell the House that they will not unilaterally fight aggressively, but of course, under the rules of engagement, they have the authority to fight in defence or in protection of other United Nations protection forces that are there. They will certainly exercise that right if it proves to be necessary.
Mr. Robert N. Wareing (Liverpool, West Derby): Was there any discussion at Halifax about the need to stop the sale of arms to oppressive regimes, particularly to those countries against which there are United Nations sanctions? If there was, was the Prime Minister embarrassed?
The Prime Minister: There was a discussion on collaboration with Iran on nuclear matters. That was the subject of a discussion. If the hon. Gentleman cares to see the chairman's statement, which has been deposited in the Library, he will see that it calls
"on all States to avoid any collaboration with Iran which might contribute to the acquisition of a nuclear weapons capability."
The G7 partners have already adopted restrictive practices on nuclear co-operation with Iran.
Mr. Peter Bottomley: My right hon. Friend referred to the discussion on the brutal war in Chechnya and the hostage taking in Russia. Whatever decision the Russians may feel they have to take, will my right hon. Friend make it plain that this country is not likely to change its policy when people make menaces of that kind?
The Prime Minister: That point is clear and it was made clear again.
Mr. Barry Jones: The right hon. Gentleman began his statement by referring to the
36
important subject of unemployment. Has he the courage to tell the House how many people are unemployed in the United Kingdom?
The Prime Minister: If the lion. Gentleman goes to the Library, he will see the figures that are published monthly, which are calculated on more than one basis. At present, that figure stands at just over 2.3 million, and he will find that that is so according to more than one basis. The figure was 2.9 million some time ago. If the hon. Gentleman looks across the European Union, he will see that, whereas the average unemployment rate is around 11 per cent., it is 8.3 per cent. here. In some large countries, the unemployment rate is getting on for 13 per cent.—for example, the rate stands at just over 20 per cent. in Spain. The only European Union country with a lower unemployment rate than us is, I think, Holland.
Mr. Anthony Coombs: When considering the long-term reform of the United Nations institutions, did my right hon. Friend stress the importance of maintaining Britain's seat on the Security Council? Does he agree that, if there were to be a European Community seat, as proposed by the Labour party, Britain's seat would be gravely threatened?
The Prime Minister: In due course, the membership of the permanent five on the Security Council will be reformed, which I am sure is right. I have no doubt that that reform will lead to the enlargement of the five, to include a larger number of nations on the Security Council. I doubt that that will be a speedy process, because, although there is rapidly building consensus in favour of two nations, other nations will also want to be included. It will therefore take some time before a decision is reached. I see no threat whatsoever for the United Kingdom's place on the Security Council either now or in the future. I see no probability whatsoever that the European Union would be collectively represented. It is currently represented by France, Germany and the United Kingdom. It would not be in the tradition of the Security Council for it to have a member that did not represent a nation state.
Mr. David Winnick: On Bosnia, is there not something particularly despicable about the manner in which the Serbs have deliberately targeted civilians—for example, by murdering those who were trying to get water at the weekend? That probably occurred at the same time as the summit was taking place or just ending. Does not such an act amount to outright terrorism?
The Prime Minister: Many of the actions that we have seen in Bosnia in the past few years have been, as the hon. Gentleman said, despicable. Many have been aimed at innocent civilians or aimed carelessly, in a manner in which innocent civilians have been as likely to be killed or maimed as soldiers fighting in the opposite camp. I therefore share the hon. Gentleman's view, but I would add only that the appalling behaviour of the Serbs has from time to time been matched by the other parties as well.

Points of Order
4.27 pm
Mr. David Rendel: On a point of order, Madam Speaker. As someone who came to this place from local government, I am well aware that councillors are forbidden to take part in a debate or vote on a motion in which they have a declarable interest. They are not even allowed to remain in the council chamber during the debate. May I ask whether the rules that we impose on ourselves in the House are any weaker or looser than those that we impose on local councillors, in particular, in relation to the participation of the Chief Secretary to the Treasury in the forthcoming debate on BMARC?
Madam Speaker: I thank the hon. Gentleman for giving me notice of his point of order. The hon. Gentleman and the House must know that we have different rules from local authorities on that and many other matters.
The hon. Gentleman's point is essentially dealt with on page 358 of "Erskine May", from which he will see that there must be a pecuniary interest before any question of the disallowance of a vote can be entertained. There are no rules at all restricting attendance during a debate.
Mr. Peter Hain: On a point of order, Madam Speaker. Will the House have a chance to vote on the sinking of Brent Spar, which contains 100 tonnes of toxic—
Madam Speaker: Order. I have heard the hon. Gentleman's question. As far as I am concerned, the House votes only when there is a motion on the Order Paper.
Mr. Terry Dicks: Further to the point of order raised by the hon. Member for Newbury (Mr. Rendel), Madam Speaker. I am afraid that the hon. Gentleman has got it wrong. Councillors in local government must vote on rent increases and—
Madam Speaker: Order. I have made it clear to the House how our rules differ in many respects from those of local government.
Mr. Harry Cohen: On a point of order, Madam Speaker. In July, I asked a parliamentary question—
Madam Speaker: July 1994?
Mr. Cohen: Yes.
Madam Speaker: I am glad that the hon. Gentleman has such a good memory.
Mr. Cohen: I asked the Secretary of State for Defence
"on what grounds the documents and diaries of Mr. Gerald James, the former chairman of the British Manufacturing and Research Company, were taken by the Ministry of Defence police; what information of relevance was gleaned from them; when they will all be returned to him; and if he will make a statement."
I shall not read the whole of the reply given by the Minister of State for the Armed Forces—it is in Hansard—but it included the statement:
"In 1993 at the conclusion of all aspects of the MOD investigation, the documents were returned to Astra Holdings' officially appointed receiver, Cork Gully."—[Official Report, 21 July 1994; Vol. 247, c. 554.]
A statement made at the weekend has shown that that answer clearly was not correct. May I make a couple of points in relation to that?
Madam Speaker: Order. The hon. Gentleman can raise only points of rules and procedure with me. He has indicated to me that he wishes to speak in the debate, and perhaps he can make his points to the Government when he speaks. If there is a point of order for me, I must of course hear it.
Mr. Cohen: I shall put my other points during the debate. The point relevant to you, Madam Speaker, is that the record is incorrect. Will you make sure that a correction is made to the record?
Madam Speaker: Let me answer that. If the hon. Gentleman believes the record to be incorrect—as he is alleging—he must raise that matter during the debate today.
Mr. Cohen: It has been stated that the information contained in the record is incorrect. Will you take the matter away and have a look at what can be done with that record? Should not the Ministry of Defence's handling of the parliamentary answer be investigated, because clearly its procedures were at fault?
Madam Speaker: The hon. Gentleman is attempting to make a serious point, and I shall have a look at the matter. He is obviously trying to clarify a very important matter. May I suggest that he tables further questions to obtain the information and answers that he seeks? He can obtain the information only by using the Order Paper, and questions are the best method of doing that.
Mr. Cohen: I shall take your advice, Madam Speaker, and table further questions. But what guarantee will I have that I shall receive correct answers?
Madam Speaker: I have no authority over the answers that Ministers give. The hon. Gentleman is a very probing Member of this House, and I am sure that he will see to it that his questions are properly answered.

Opposition Day
[14TH ALLOTTED DAY]
Opposition Day

  BMARC
  Madam Speaker: I have selected the amendment standing in the name of the Prime Minister. Given the number of hon. Members who are seeking to speak, I must limit speeches from Back Benchers to 10 minutes.
  4.32 pm
  Dr. John Cunningham: I beg to move,
  That this House calls for an independent inquiry into the BMARC affair.
  Once more the nation has been rocked by disclosures of incompetence, negligence and perhaps worse at the heart of this decrepit Government. Again we learn that, after years of denials, stated Government policy on arms sales to Iran was covertly undermined and widely breached. Again we learn that, in a wide variety of answers to parliamentary questions—as my hon. Friend the Member for Leyton (Mr. Cohen) has highlighted—Ministers have held to the fiction that the policy was being rigorously observed when it was being easily and regularly breached.
  Finally, and most astonishingly, we learned this weekend that more potentially crucial documents had been lost, overlooked or forgotten, and that evidence germane to investigations, prosecutions and inquiries had been mislaid—by accident, of course—by the Ministry of Defence police, the very people responsible for their care. Like the last chapter of "Huckleberry Finn", no doubt they were locked in an attic somewhere. It is no wonder that in respect of this Government's stewardship—a period that has seen Government officials coin phrases such as "being economical with the truth" and "the truth is a difficult concept"—Mark Twain's words still apply:
  "Rumour is half way around the world before truth has got its boots on".
  The Government seem to have removed the laces from the boots of truth in these matters.
  The issues go to the heart of the credibility, competence and integrity of government in our country. They raise fundamental questions that demand rigorous investigation, especially as we need to be convinced that Ministers were not conniving all along in a covert policy of providing arms to Iran while pretending publicly to prevent weapons sales.
  There is an astonishing parallel with the arms to Iraq scandal, which has been under investigation by the Scott inquiry since November 1992. The Government's stated policy on arms sales to Iran and Iraq was set out by Lord Howe in October 1985 when he was Foreign Secretary. He informed the House of
  "the following set of guidelines to all deliveries of defence equipment to Iran and Iraq:
  (i) We should maintain our consistent refusal to supply lethal equipment to either side;
  (iii) We should not, in future, approve orders for any defence equipment which, in our view, would significantly enhance the capability of either side to prolong or exacerbate the conflict;
  (iv) In line with this policy, we should continue to scrutinise rigorously all applications for export licences for the supply of defence equipment to Iran and Iraq".—[Official Report, 29 October 1985; Vol. 84, c. 450.]
  40
  After years in which three different Foreign Secretaries, six different Trade and Industry Secretaries and four different Defence Secretaries told the nation that those policies were being implemented effectively, we now know that their statements were false. Their statements are worth recording, although time limits me to only a few quotations. In December 1990, the then Minister of Trade, the right hon. Member for Hove (Sir T. Sainsbury), said:
  "The guidelines … were set out … on 29 October 1985, and since then they have been scrupulously and carefully followed".—[Official Report, 3 December 1990; Vol. 182, c. 29.]
  In August 1991, the right hon. Member for St. Albans (Mr. Lilley) told the Select Committee on Trade and Industry:
  "Our examination of the records shows that the policy announced in Parliament in 1985 was adhered to both in the spirit and in the letter".
  That statement is hardly justified in the light of the announcement by the President of the Board of Trade last week; nor does it fit with the Prime Minister's guidance to Ministers which said that Ministers had a
  "duty to give Parliament and the public as full information as possible about the policies, decisions and actions of the Government".
  The right hon. Member for St. Albans told my hon. Friend the Member for Rhondda (Mr. Rogers)—
  Sir Timothy Sainsbury: Will the hon. Gentleman give way?
  Dr. Cunningham: I will give way in a moment.
  The right hon. Member for St. Albans told my hon. Friend:
  "Each application for a licence is considered on its merits in consultation with other Departments taking into account the type of equipment, its end use and end user".—[Official Report, 17 December 1990; Vol. 183, c. 66.]
  The right hon. Member for Witney (Mr. Hurd) told the House:
  "Arms embargoes are in place with regard to Iran and Iraq".—[Official Report, 28 November 1990; Vol. 181, c. 884.]
  The right hon. Member for Thanet, South (Mr. Aitken) was very active in answering questions on the subject in his role as Minister of State for Defence Procurement. In a written answer, he told my hon. Friend the Member for Kirkcaldy (Dr. Moonie) that the Government's policy was
  "to permit exports to Iran only within the policy announced by the then Foreign Secretary on 29 October 1985".—[Official Report, 24 November 1992; Vol. 214, c. 645.]
  The right hon. Member for Thanet, South told my hon. Friend the Member for Clackmannan (Mr. O'Neill):
  "There has been a substantial sea change in Whitehall under the leadership of my right hon. Friend the Prime Minister, away from the old habits of unnecessary secrecy … Now there is greater emphasis on a new era of more responsible openness in all matters."—[Official Report, 30 June 1992; Vol. 210, c. 706.]
  Sir Timothy Sainsbury: Will the hon. Gentleman give way?
  Dr. Cunningham: I shall give way when I have finished my quotations.

  41
  On 13 May 1992, the right hon. Member for Thanet, South said in a written reply to my hon. Friend the Member for Clackmannan:
  "I would add, however, that since 1984, the United Kingdom has refused to supply any equipment which could prolong or exacerbate the Iran-Iraq conflict"—[Official Report, 13 May 1992; Vol. 207, c. 156.]
  We now know that none of those statements were true.
  Sir Timothy Sainsbury: The hon. Gentleman started his speech with a number of sweeping allegations. He went on to read a lengthy list of quotations from Ministers. He is now saying that every one of those ministerial statements was not only untrue but, by implication, that the Minister who made it at the time knew it to he untrue. Is not his whole case based on the idea that, when somebody sets out to break the law or avoid regulations, those whose law or regulations they are seeking to break or breach are aware of that person's intentions?
  Dr. Cunningham: Is not the right hon. Gentleman making the case for an independent inquiry? We need to know the answer to his question. The House and the country need to know exactly what was going on in government at the time.
  Sir Timothy Sainsbury: Will the hon. Gentleman give way?
  Dr. Cunningham: No. I am not giving way again.
  Similar assurances were given about the return of documents withheld by the Ministry of Defence. On 30 March this year, I wrote to the Prime Minister about the withholding of documents, asking him three specific questions. In his reply of 5 April, he said of the papers:
  "These were in the temporary possession of the Ministry of Defence Police after they had been taken from Astra and BMARC during an investigation into corruption. These were sent to the receivers in mid-1993 when the investigations were completed."
  As we now know, that statement is completely false, as has again been revealed apparently by accident and not through any desire for openness.
  Similarly, on 4 April this year, my hon. Friend the Member for Wallsend (Mr. Byers) was given the same answer by the Leader of the House. We now know that those answers were untrue.
  We have established that the right hon. Members for Huntingdon (Mr. Major), for Witney, for Thanet, South for St. Albans and for Braintree (Mr. Newton) have all given answers that now cannot withstand examination because they are untrue. I am sure that, given time, many more untrue answers to questions and interventions will emerge from the records of the past few years.
  The matters have come to light only because of the persistence of my hon. Friends the Members for Rhondda, for Newcastle upon Tyne, Central (Mr. Cousins), for Wallsend, for Cunninghame, North (Mr. Wilson) for Clackmannan, for Kirkcaldy and others, and not because the Government have been open.
  The President of the Board of Trade was obliged to lift the veil on the real state of affairs in his statement to the House last week because he could not answer the questions from my hon. Friend the Member for Cunninghame, North, although a plethora of his predecessors had willy-nilly answered similar questions—wrongly, as it turns out.
  42
  Many questions, however, remain unanswered. In the circumstances, how can anyone accept that we know all there is to know? We have learnt by experience that the Government cannot be trusted on such issues, any more than they can be trusted on their promises on taxation.
  Mr. Winston Churchill: Before the hon. Gentleman waxes holier than thou, is he aware that the Labour Government under the late Lord Wilson supplied counter-insurgence Puma helicopters to South Africa in contravention of mandatory United Nations sanctions, without giving the facts to the House?
  Dr. Cunningham: I am aware that the Wilson Government stopped selling arms to South Africa.
  Last week, in his wish to help his Cabinet colleagues, the President of the Board of Trade made a statement blaming officials. He blamed the failure to circulate intelligence reports properly. He blamed almost everyone but Ministers. He said that so many things had to be checked that' his Department was swamped and, as a consequence, 36 per cent. of BMARC applications were not properly supported by documentation.
  Apparently, by a remarkable coincidence, the very things that Ministers were trying to block—guns and ammunition—got through. There were a lot of guns—naval cannon. If all the guns exported to Singapore had been used by the Navy there, the Malacca straits would probably be blocked by capsized warships. No one in the Government noticed; or did they notice but not want to know? The Conservative Government ensured that the combatants did not have lap-top computers in the trenches on the battlefield, but they made sure that they had guns.
  In a debate on arms to Iraq in November 1992, the President of the Board of Trade said:
  "Scrutiny was to be carried out by the interdepartmental committee on exports to Iran and Iraq, which comprises officials from the Foreign and Commonwealth Office, the Ministry of Defence, the Department of Trade and Industry and other Departments as necessary. Not only would individual licence applications need to be scrutinised, but it was obvious that, in many cases, a judgment would have to be exercised as to whether or not certain potential exports came within the rules. I draw attention only to the words 'significantly enhance' or 'prolong or exacerbate', so that the House may appreciate the detail of the judgment that was bound to be necessary."
  The right hon. Gentleman told the House that the detail of all the judgments had to be scrutinised, not just the superficiality. That is what he said was happening, but we know from his statement last week that it could not possibly have been true.
  In the same speech, the right hon. Gentleman continued:
  "Secondly, it is obvious that any interpretation of those rules require careful consideration of individual export licence applications."—[Official Report, 23 November 1992; Vol. 214, c. 640–41.]
  If what the right hon. Gentleman told the House in that debate was happening, how did those weapons escape the net? That could have occurred only because what he claimed was happening was not actually happening, so on that occasion the right hon. Gentleman was not being particularly accurate or candid with the House, of which his statement to the House last week was absolute confirmation.
  In his statement to the House on 13 June, the President of the Board of Trade painted a picture of the treatment of intelligence in Whitehall that frankly defies belief.

  43
  Are we to believe that the 1986 intelligence, which he says was not distributed to DTI, simply sank without trace in the rest of Whitehall? He acknowledges that it went to other Departments. What did they do with it? Did they ignore it? Did not one Sir Humphrey pick up the phone and say, "Bill, I think you should know about this. It affects your Department"? Did not one person in the FCO, the MOD or the Cabinet Office, which presumably received the intelligence, consider that there was something to act upon, perhaps even to check with the Department of Trade and Industry and ensure that it was informed about what was happening? It is just not credible.
  Are we to believe that, in the period before 1988, when, we are told, two intelligence reports were distributed to the DTI, no assessment was made of intelligence for distribution around Whitehall and to Ministers who took it into account? I find it difficult to accept that, because an intelligence report was not distributed to the DTI, the Department can be assumed to have been in complete ignorance of its contents for several years. The point just does not bear scrutiny.
  In his statement to the House, the President painted this picture in a very odd way, completely unconvincing on subsequent analysis. In any case, even when intelligence reports were distributed to the DTI, as in the two 1988 cases, much good did it do. When there were not very difficult links between Oerlikon and BMARC to be made, the Department simply failed to make them. The President says that arrangements for the distribution and handling of intelligence, both generally and in the DTI, have been "substantially improved" since 1988, but I put it to him that it is not the distribution and handling of intelligence that needs improving: it is the reading and using of the reports by Ministers and their officials where the improvement is long overdue.
  Did officials, on the other hand, know from Ministers that they did not want to hear? It is an unusual experience for me to find myself in agreement with Baroness Thatcher, yet I cannot help feeling that she was correct when she told the Scott inquiry, commenting on the handling of intelligence reports, that one would expect Ministers, when dealing with such an issue, to ascertain whether there was any intelligence to be considered, or to ask someone to put an inquiry through to see if there was any.
  As with Iraq, so apparently with Iran. No one, including Ministers, seems to have asked—perhaps because they did not want to know the reply.
  Last week, in a series of media interviews, the President described all these failures as "a cock-up". Apparently the lost papers this weekend were another cock-up. Government by cock-up is what this country has under the President of the Board of Trade and his right hon. Friends. We have non-executive directors who do not read minutes or agendas. We have Ministers who do not read intelligence reports, or even ask intelligent questions about them. It can all be summed up by saying: negligence, incompetence and a lack of integrity, too.
  The guidelines were issued in 1985; project LISI began in 1986, 12 months later. Directors at BMARC say that Whitehall knew the guns were going to Iran via Singapore from the very beginning. Intelligence reports said that a UK company was avoiding export controls by shipping
  44
  weapons via a subsidiary in Singapore—but no one in the Government apparently made the connection. The right hon. Member for Thanet, South, who was recruited by BMARC exactly because of his knowledge of the middle east, knew nothing about one of the company's largest orders; when at least three former directors of BMARC have stated publicly that, as all directors were regularly briefed on all aspects of project LISI, the right hon. Gentleman must have known who the end user was.
  Are we to believe that a man who says he took his non-executive duties seriously did not see fit to press his fellow directors as to the real nature of project LISI—a project under which naval cannon were ordered by Singapore, despite the fact that its navy did not have enough boats capable of mounting a fraction of the weapons provided?
  It is a basic principle of company law that a non-executive director has the same obligations and is subject to the same liabilities as any other director. He has a duty to keep himself informed about the business activities of the company. The fact that the Chief Secretary may not have bothered to find out the basic facts of one of his companies' largest orders does not excuse him. The right hon. Gentleman failed in his duties as a non-executive director; and the same is true of Ministers and their Departments. Ministers have a responsibility to keep themselves informed about the workings of their own Departments.
  This is not just a question of one person's guilt or otherwise. This is a matter that encompasses many Government Departments and many Ministers—for instance, the Department of the President. Not only did his Department fail to make a connection between BMARC's export licence applications and the intelligence reports distributed, but during the period of project LISI, 1986 to 1989, full supporting documentation concerning end users was not supplied—was apparently never asked for by the Department—yet the licences were granted. How on earth does this statement fit in with Lord Howe's assertion, repeated so often by so many Ministers to the House, that the Government would
  "continue to scrutinise rigorously all applications for export licences"?—[Official Report, 29 October 1985; Vol. 84, c. 450]
  Anyone genuinely concerned for the right hon. Member for Thanet, South should support the call for an independent inquiry. After all, even his own publicity adviser's faxes seem to support the need to clear up the matter once and for all. The Chief Secretary said publicly last week that he would welcome a fuller inquiry.
  The concern of the President of the Board of Trade for his right hon. Friend shone through his extraordinary performances last week, in the House and in media interviews. As the book of Samuel puts it:
  "I am distressed for thee, my brother Jonathan."
  The President is, as we all know—and his colleagues know only too well—in the clear. He has nothing to fear from an independent judicial inquiry; he was out of government for most of the time. Indeed, he might positively benefit because, as has been noticed—as much by his right hon. and hon. Friends as by us and the media—he increasingly resembles a man who hopes to keep his head while all around are losing theirs.
  The Scott inquiry is dealing with arms to Iraq. We do not want to delay it any longer. The Trade and Industry Select Committee has already held one inquiry into these

  45
  issues. We now know that it was denied papers and evidence. Not surprisingly, the report was inconclusive. I know that my hon. Friend the Member for Sheffield, Central (Mr. Caborn) is trying to clarify the position, not just of the President but of the whole Government, on these issues.
  The House is facing new revelations in what are, by any test, extraordinary circumstances. That is why we believe that the BMARC affair should be the subject of a fully independent judicial inquiry, quite separate from the Scott inquiry. This new inquiry should have access to all documents and reports relevant to the BMARC affair. It should be headed by a judge; the person appointed should satisfy him or herself that the terms of reference are effectively drawn up. The issues raised in the BMARC affair go to the heart of the integrity and competence of government in our country. They should be independently and rigorously investigated.
  Most of all, I am surprised that the President of the Board of Trade is not supporting our motion, which reflects the seriousness of the allegations and issues under debate—negligence, honesty, ministerial competence and integrity. The right hon. Gentleman certainly supported such an approach in the past, for in 1992 he had this to say about very similar accusations:
  "That brings me to the allegation that, while rules were in place, they were flouted with ministerial connivance, if not positive encouragement. The seriousness of such allegations cannot be overstated, but nor can they be examined with the care that is appropriate without a full and independent inquiry…That is the only way in which the matter will be seriously investigated to the satisfaction of the House and a wider public…Conservative Members want an independent inquiry to be carried out by a distinguished judge, with all the evidence, and that is what our amendment seeks."—[Official Report, 23 November 1992; Vol.214, c. 644–53.]
  The Conservatives' amendment does not seek that today—but then, as so often before, the right hon. Gentleman has shifted his ground. I nevertheless urge the House to support our motion tonight.
  4.59 pm
  The President of the Board of Trade and Secretary of State for Trade and Industry (Mr. Michael Heseltine): I beg to move, to leave out from "House" to the end of the Question and to add instead thereof:
  "recognises the independence of the all-party Select Committee for Trade and Industry; welcomes the Government's assurance that if that Committee decides to examine the issues raised by the allegation that Singapore was used as a conduit for arms to Iran then it will co-operate fully; and recognises that as far as intelligence is concerned the Government will establish procedures with the Select Committee in the light of the Intelligence Services Act 1994.".
  In the ordinary course of events, Mr. Deputy Speaker, I would begin with your characteristic title, but the whole House will want to recognise that in one material way your title has changed since I was last able to address you. I do not in any way seek to change your title, but the spirit of my congratulations is deep and heartfelt.
  It was not until the 27th minute of the speech of the right hon. Member for Copeland (Dr. Cunningham) that it appeared that there was a substantial difference between the thrust of what he was saying and the reasons why I made an oral statement a week ago. I accept at once that my statement arose directly from the fact that my hon. Friend the Under-Secretary of State and I had three written questions to address from the hon. Member for
  46
  Cunninghame, North (Mr. Wilson). As a result of those questions, we did what the House would expect Ministers to do, which was to ask the basic questions and to seek the basic information so as to give a full answer to the House.
  My hon. Friend and I were not satisfied with the answers which were in front of us, and therefore asked for further information. As a result of the further information which was brought to our attention, it became apparent that there was a serious issue which Ministers in my Department first had to address. The right hon. Member for Copeland was correct when he said that there is a range of quotations, letters and parliamentary answers which needs to be revisited in the light of my statement.
  Mr. D. N. Campbell-Savours: May I take the President of the Board of Trade back a few sentences to clarify his position? He said that the first drafts which were placed before him were unsatisfactory. Does that mean that civil servants put drafts before him which they knew to be misleading?
  Mr. Heseltine: No. I realise that the Labour party has not been in government for a long time. It is common—
  Dr. John Cunningham: Patronising.
  Mr. Heseltine: I am not patronising the hon. Member for Workington (Mr. Campbell-Savours): I am commenting on a merciful release for the country, which has been spared the phenomenon of a Labour Government.
  It is common for Ministers to change the drafts of parliamentary answers. That is what Ministers are supposed to be in a position to do. The thrust of the questions of the right hon. Member for Copeland is that we should have done that earlier, as opposed to not doing it at all. Perhaps the Labour party will try to understand the normal workings of government. It is—[Interruption.]
  I never said that they were dishonest. I merely said that my hon. Friend the Under-Secretary of State and I were not satisfied that the responses answered the questions to our full satisfaction. Looking back, without the drafts in front of me—this is if I remember correctly—I thought that we could give fuller answers. I thought that, in giving fuller answers—[Interruption.] There is no surprise in any of this. The House will appreciate that it is precisely for those reasons that I came before it with an oral statement.
  Mr. Allan Rogers: Will the President of the Board of Trade give way on that point?
  Mr. Heseltine: No.
  I am sure that the House will appreciate the enormity of the fact that the Labour party wants an independent judicial inquiry, which would take a long time. It is now trying to press an inquiry into a few moments across the Dispatch Boxes. I must be allowed to try to explain as fully as I reasonably can the circumstances and the decisions that the House will have to face this evening.
  I have made it clear that my hon. Friend the Under-Secretary and I asked for further details lying behind the original answers which were presented to us. As a result of further details, we became convinced that there was a need to bring to the House, in one form or another—I shall discuss that in a moment—fuller information, which would mean that earlier information would have to be modified, adjusted or even changed in all the circumstances.
  Mr. Rogers: Questions were tabled on issues similar to the one that we are discussing for over five years. Even last year, the particular issue had been brought to the attention of the right hon. Gentleman's Department. Why did he realise that the answers were unsatisfactory? Were abilities and perceptions peculiar, or did he know that there was a gap in the information? If so, how did he find out that there was a gap?
  Mr. Heseltine: The hon. Gentleman has asked a specific question. I happen to remember one of the reasons that influenced me at the time. With my hon. Friend the Under-Secretary, I had asked for certain information in a form which had not been asked for before. It so happened that that was one of the questions that I had asked.
  The precise question tabled by the hon. Member for Cunninghame, North happened—I have no criticism of this—to focus upon the particular inquiry that I had made within a matter of weeks, or days probably. He asked for information which I had just commissioned. The information was in my possession and that of the Department, and I could see no reason for not providing it. That information, however, revealed information which was new to the House and new to Ministers.
  That was one of the reasons why I had information available to me which had not been available previously to Ministers. That is one of the reasons why my hon. Friend and I were in a position to give a different answer from that which Ministers had been able to give earlier.
  Given that we had decided that there was a need to answer fully, fairly and frankly the questions which had been put to us, how did we deal with the issue? We could have done what would have been perfectly proper in the circumstances—I have been criticised for not following the route—and answered a written question with a written answer. That would have been a defensible response. I would not have been prepared to do it, but technically I could have used a device which all Governments have employed from time to time in different circumstances. I could have sought a bland form of words which would have skated over the issues. I did not try to do that.
  If the House wants to discuss these matters seriously, it should be acknowledged that we all know that there are, and have been throughout time, answers to questions which do not reveal the whole story. I could have sought a form of words which would have had that effect. I was not prepared to do that.
  The next option was a written answer. I knew perfectly well that a serious matter was before me. I thought that the House would wish to ask questions about it immediately it became aware of the issue. I knew that if the House did not want to, although I knew that it would, there would be an immediate inquiry by the media over 24 hours until, by means of a private notice question, I was back at the Dispatch Box the next day going through precisely what seemed to be the right thing to do, which was to make a statement in the first place.
  That was the precise position that we decided to adopt.
  Mr. Brian Wilson: Will the right hon. Gentleman give way?
  Mr. Heseltine: No.
  That led to the next inevitable question—
  Mr. Wilson rose—
  Mr. Heseltine: I give way to the hon. Gentleman.
  Mr. Wilson: I am obviously grateful that my questions brought the right hon. Gentleman to the House. We shall discuss the problems in the wider context of what he says later. It is interesting that the right hon. Gentleman has revealed that he had already set parallel inquiries in train. What prompted him to do so?
  Mr. Heseltine: There was a range of other questions, and I had been looking at them. The House must realise that it was not an isolated event. There was a series of questions, and I was looking at answers to them. We had been able to answer some of them quickly. We could not answer the right hon. Gentleman's questions quickly, as we did not have the information. It took us some six weeks, if I remember correctly. In the course of answering other questions, I undoubtedly would have pursued lines of inquiry, which, when the precise question came from the right hon. Gentleman, would have been relevant to it.
  Dr. John Cunningham: I am grateful to the President for giving way again. He just told the House, Sir Geoffrey, and I take this opportunity to congratulate you—[Interruption.] I say that, because Sir Geoffrey was not in the Chair when I began my speech. The President just told the House that he could not answer the questions of my hon. Friend the Member for Cunninghame, North (Mr. Wilson). Why, then, over a number of years, did his Ministerial colleagues go on giving answers to similar questions with such apparent authority and ease?
  Mr. Heseltine: The right hon. Gentleman will understand that the evidence available to my ministerial colleagues in the answers that they gave had appeared satisfactory. On the evidence that was available to them at the time, the answers appeared to be accurate. It was because of the precise investigations that we had begun, as I have explained to the House, that we became aware that there was cause for concern. That is why I took time to answer the questions, and, when I had the answers, came to the House with a full explanation, as I believed it to be then, and still do, in a way in which I thought appropriate.
  Mr. Rogers rose—
  Mr. Heseltine: No. I am not giving way. I am trying to take the House through difficult issues. [Interruption.]
  Mr. Deputy Speaker (Sir Geoffrey Lofthouse): Order. The President of the Board of Trade has been asked questions, and he has a right to be able to answer them without interference.
  Mr. Heseltine: The next question which, inevitably would have been asked, would have been: "Given that the President of the Board of Trade has answered a question in a way which changes evidence before the House, in the form of answers, should there be an inquiry?"
  It was evident that that question would be asked, and I felt therefore that, with my ministerial colleagues, we should address it. Therefore, far from covering up, my statement categorically suggested that, if the Select Committee on Trade and Industry wished to conduct an inquiry, we would give it the fullest possible co-operation.
  Mr. Campbell-Savours: Will the President of the Board of Trade give way?
  Mr. Heseltine: No.

  49
  That seemed to me an absolutely clear indication that the Government recognised that this was a proper subject for an independent inquiry. There was no issue between myself and the right hon. Gentleman on this matter.
  Dr. John Cunningham: The difference between us is that we are calling, as the right hon. Gentleman did in the question of arms to Iraq, for an independent judicial inquiry. To revert to the right hon. Gentleman's course of argument, does he not think it a remarkable coincidence that, over five years, in the face of sustained questioning, every one of his Cabinet and ministerial colleagues had come to the same conclusion: there were no questions to answer in this matter? What was so remarkably different about the evidence and information available to him?
  Mr. Heseltine: The right hon. Gentleman simply does not seem to have grasped the whole significance of the debate: to answer these questions, we have suggested an independent inquiry. That was what I said a week ago. The only issue that the right hon. Gentleman should have addressed in his speech, and which he hardly mentioned, was not the substance of the debate but the means of pursuing an independent inquiry. That is the only difference between us.
  Mr. Campbell-Savours rose—
  Mr. Rogers rose—
  Mr. Heseltine: The two hon. Members have had a fair crack of the whip—[Interruption.]
  Mr. Deputy Speaker: Order. The President of the Board of Trade has made it very clear that he is not giving way.
  Mr. Heseltine: The issue is not whether there should be an inquiry but the form of the inquiry.
  The right hon. Gentleman has tried to suggest that I blamed officials. I did not blame officials. There is nothing at all in the amendment tabled by my right hon. Friend and myself to restrict the inquiry to civil servants. There was nothing in my statement that said that civil servants got it wrong. I came to the House. I am answerable. I provided the answers to the questions.
  It is because the right hon. Gentleman, throughout the entire matter, has been trying to find a way of putting the blame on Ministers before there has been any sort of inquiry that I reject his allegations. I did not blame officials. With the agreement of my colleagues, I said that I thought that there should be an inquiry into these matters.
  The right hon. Gentleman suggested that this was all about a cover-up exercise, that, by suggesting a Select Committee rather than a judicial inquiry, we were somehow trying to get around the matter via the back door. The whole House is fully aware that the Labour party, which, to quote words that I jotted down peradventure, is interested in more responsible openness, is currently conducting eight inquiries into the practices of Labour local authorities: Birmingham, Leicester, Manchester, Nottingham, Paisley, South Tyneside, Tower Hamlets, Bradford—
  Mr. Deputy Speaker: Order. The President of the Board of Trade is straying a little. The debate is not about local authorities. [Interruption.] Order. The Chair will decide.
  Mr. Heseltine: The Chair will indeed decide, but the House, in witnessing the decision, will not lose sight of the fact that all those eight inquiries are being conducted in private—[Interruption.]
  Mr. Deputy Speaker: Order. The House must now settle down. The Opposition spokesman was given a reasonable hearing, and the President of the Board of Trade must have the same.
  Mr. Heseltine: I was settling down, but apparently without any cause, Mr. Deputy Speaker, because you were not on your feet.
  If one is to have a Select Committee inquiry, it is entirely a matter for the Select Committee to decide whether it should make such a decision.
  Mr. Barry Porter: Does my right hon. Friend agree with the implication in the right hon. Gentleman's speech: that the Trade and Industry Select Committee, which is chaired very ably by the hon. Member for Sheffield, Central (Mr. Caborn), first, is not capable, secondly, would not be independent, and thirdly, would not be objective? If that was the implication, it is quite wrong. Provided that the Committee has all the information, which perhaps we did not have on the Iraq investigation, it seems to be an entirely appropriate way, but I disapprove strongly of the suggestions made by the right hon. Gentleman.
  Mr. Heseltine: I will now be able to abbreviate my speech, because of the excellent intervention of my hon. Friend. I was going to come to the very point that he has so eloquently made.
  The issue that arises once one has decided that there is a case for an inquiry—there is no difference between the two sides of the House on this matter—is what the inquiry should investigate. Again, it is entirely a matter for the Select Committee to determine, within the discretions that it has and the motions that we are discussing, how it should go about its task.
  The right hon. Gentleman has spelt out clearly that he wants a full judicial inquiry into the matter. He made the point that I was in favour of it, and suggested it over Iraq, but he does not seem to have appreciated that any such inquiry that started from scratch with a clean sheet of paper would have to examine the licensing and intelligence dissemination arrangements, and that it would have to look at a range of other issues, but all from a starting point where it was not part of any existing inquiry.
  As the whole House is aware, Sir Richard Scott has exhaustively examined the licensing arrangements in my Department as they apply to Iraq. No one is trying to suggest—no one could suggest—that things were done in a way that one would want to defend today; but what on earth is the point of setting up another judicial independent inquiry to go over all that ground all over again? We broadly know the facts.
  A similar argument applies to the dissemination of intelligence. Those matters—again, in the context of Iraq—have been examined, and are being examined, by Sir Richard, whose conclusion we do not yet know. I do not think that a case can be made for the need to start from the very beginning, discounting all the work that has been done over nearly three years.
  Mr. George Walden: It strikes me as both insulting and absurd of the right hon. Member for

  51
  Copeland (Dr. Cunningham) to accuse Ministers of covert connivance in the supply of weapons to revolutionary Iran. On the other hand, does my right hon. Friend agree that a question does arise about British defence exports as a whole? I suspect that the issues involved in the Pergau dam affair, the Scott inquiry and the little problems that we are having here today spring not from ministerial malfeasance of any kind, but from the fact that this country has become a little too dependent on arms exports.
  When the Select Committee has completed its present job, perhaps it could look into the whole question of our over-reliance on arms exports, the opportunity cost in terms of research, technology and manpower and the long-term effect on the country—
  Mr. Deputy Speaker: Order. Long interventions of that nature do not help in short debates.
  Mr. Heseltine: My hon. Friend has raised an important point, but I consider his approach ill conceived. The research and national resources that go into the production of defence equipment are not there to sell arms overseas; they are there to equip our armed forces with the equipment that they consider necessary to the performance of their job. That is what the defence budget is designed to achieve.
  Once our military planners and equipment manufacturers have achieved it to the best of their ability, we must ask ourselves whether we should take advantage of the information, professionalism and quality of equipment available to us by selling overseas, under the regulations and regimes that we have put in place. I can find no argument that suggests that, if Britain has the equipment and the right relationship with the country concerned, we should stand back and allow the French, rather than our own people, to make the sales and create the jobs.
  Sir Timothy Sainsbury: In emphasising the advantages of building on a corpus of knowledge that is already there rather than starting with a blank sheet, does my right hon. Friend bear in mind—I suspect that he does—that the Select Committee has already examined, exhaustively and rather effectively, the very licensing arrangements to which he has referred? It did so in 1992.
  Mr. Heseltine: My right hon. Friend is right to draw attention to that.
  The option of a new judicial inquiry of the sort that the right hon. Member for Copeland wants has serious disadvantages. First, it would repeat a considerable amount of the work on matters that Sir Richard Scott has already explored exhaustively and is continuing to explore, and would take the same amount of time.
  Dr. John Cunningham: The President is making much of this point. The Select Committee on Trade and Industry, however, will not have Sir Richard's conclusions, or the conclusions that he has drawn about the very matter to which the right hon. Gentleman refers. It, too, will have to start with a blank sheet of paper, will it not?
  Mr. Heseltine: I shall come to the precise point that the right hon. Gentleman has made. There is, however, an
  52
  alternative, and I am surprised that he did not raise it: Sir Richard could have been asked to continue his inquiry. [Laughter.] I am sure that Sir Richard will gather any impressions that he wishes from the amusement that that has engendered among Labour Members.
  Let me say at once that I am not in favour of that solution, because I think that it is in the public interest for Sir Richard to finish his report. By the time it is concluded, it will probably have taken virtually three years to complete, and cost the best part of £2 million. That is a matter of concern, and the House and a wider public would like the matter to be concluded.
  I am not convinced, however, that the House now wants another inquiry of that sort, any more than I am persuaded that the House wants Sir Richard, having finished with the Iraq inquiry, to be invited to extend his inquiry to deal with the wider issues involved in the Iran process.
  Mr. Donald Anderson rose—
  Mr. Heseltine: It becomes apparent to me—adopting a step-by-step approach—that, by acclaim, the House has reached the very judgment that the Government reached a week ago. It does not want Sir Richard to go on; I do not think that it wants to start another Scott inquiry costing another £2 million, taking another three years and stretching into the next Parliament—which is what the right hon. Member for Copeland has asked it to do.
  I am not persuaded that the right hon. Gentleman has made a case of any sort. All he has done is reveal, first, that the Government behaved properly in making an oral statement; secondly, that we were right to recognise the need for an independent inquiry; and thirdly, that we were right to suggest that the independent inquiry should be carried out by the Select Committee on Trade and Industry, if it was so minded.
  Immediately after my statement, the Committee's Chairman said that most of his colleagues
  "would like to see a sharp inquiry into it quickly and not for it to drag on."
  To all that I say amen. That is precisely the point that the right hon. Gentleman has not taken on board.
  Mr. Donald Anderson rose—
  Mr. Heseltine: What I find most questionable and doubtful about the right hon. Gentleman's position is the assumption that an inquiry carried out by a Select Committee of the House is not independent.
  Mr. Anderson rose—
  Mr. Heseltine: No, the hon. Gentleman cannot intervene on that point. He has been trying to intervene for some minutes, and he now wants to try to link his question to the point with which I am now dealing, but he will not have the chance.
  I happen to agree with my right hon. Friend the Member for Hove (Sir T. Sainsbury), who has now left the Chamber, that the Select Committee—under the chairmanship of the hon. Member for Sheffield, Central (Mr. Caborn)—does an impressive job. When I have appeared before it, it has never occurred to me that there is any escape from the rigorous questioning to which I am subjected. I have never for a minute believed that Labour or Liberal Members are in some way minded to make it easier for Ministers to escape the questions by giving the wrong answers.

  53
  I believe that—in terms both of the desirability of moving the process forward and dealing with the questions as rapidly as possible, and of achieving a degree of independence that I personally believe members of the Committee to be uniquely charged with achieving, and to have proved themselves capable of achieving—the Government amendment is correct.
  The Chairman of the Select Committee has now written several letters to me on the subject of the mechanisms and procedures within which his Committee will work. I have tried to answer them; I did not answer the one that arrived at 3.25 pm today, but I shall do so at the earliest opportunity.
  My intentions in suggesting this route for the House were to enable it to deal with the matter with dispatch, to co-operate with the Select Committee within the proper rules of the House and to answer questions that the House is entitled to ask and have answered. I commend the amendment to my right hon. and hon. Friends.
  5.29 pm
  Mr. Richard Caborn: In the light of what has been said, I had better clarify the position. The hon. Member for Buckingham (Mr. Walden) spoke about the United Kingdom's reliance on arms exports. The Select Committee on Defence and the Select Committee on the Treasury and Civil Service are jointly meeting on that very issue and will, one hopes, report before the recess.
  It is important for me to update the House on the current situation and on the response of the Select Committee on Trade and Industry to the request by the President of the Board of Trade for an inquiry into BMARC and exports to Singapore and Iran. The Committee discussed those matters on Wednesday and, as is right, we take the President of the Board of Trade's request seriously. What will happen after tonight's vote is a matter for the House and not for the Select Committee.
  To the best of my knowledge and that of my officials, this is only the second time that a Secretary of State or, in this case, the President of the Board of Trade, has requested a Select Committee to hold an inquiry. It is usually the other way round. For the record, the only other request related to the closure of 31 pits.
  When the members of the Committee discussed the matter last week, we were mindful of the inquiry by the previous Select Committee on Trade and Industry into exports to Iraq, Project Babylon and the long-range gun. Anyone who revisits that inquiry will see that its report was inconclusive because the Committee did not have access to a number of Departments outside the Department of Trade and Industry.
  The President will probably recall that my first action on becoming Chairman of the Select Committee on Trade and Industry was to write to his Department asking for clarification of that issue. Perhaps he would like to check the record on that. I said that it was unfortunate that the Select Committee could not reach a conclusion because it was denied access to people and papers.
  The other area in question relates to Customs and Excise. On Wednesday, the Select Committee wanted to make sure that it would be able to get access to all the information that has been available to the Department of Trade and Industry—the information that was referred to in the President's statement.
  Mr. William Cash: The hon. Gentleman speaks about information, which he could obtain from civil servants. Does that include advice tendered to Ministers? What was the attitude of the Department in that respect?
  Mr. Deputy Speaker: Order. I remind the House that there is a 10-minute limit on speeches.
  Mr. Caborn: When all the information in the letters is revealed—and I do not intend to do that in this debate—the House will see that, as the President said, a number of letters passed between the Department and the Select Committee. The answer to the hon. Gentleman's question is that the matter has been raised and that we are still awaiting answers.
  As has been said, we are dealing with a subject that is nearly a decade old and many of the civil servants who were in place then may no longer be there. That was another area of concern when the Select Committee was scrutinising the issue of the Iraqi super-gun.
  A number of key areas make the inquiry unique and dispensation may be required from some Ministers. I shall not go into detail but I can tell the House that the Select Committee is corresponding with the Department to resolve that. I hope that the Committee will have resolved those questions by Wednesday and will decide, first, whether to proceed with the inquiry and, secondly, on the terms of reference. The Committee operates under Standing Order No. 130, but that will need to be expanded if we are to carry out a thorough inquiry. As the President said, it may be short. I hope that it will be and that we shall be able to focus on clear terms of reference and to present a report to the House.
  Select Committees are responsible to the House, and we must balance the President's request, which we take seriously, and the information, people and papers that the Government will allow for scrutiny against the credibility of the Select Committee system. As Chairman of the Select Committee on Trade and Industry I am the custodian of its credibility. The DTI and the President must allow the Committee access to information which it believes is necessary for a thorough inquiry.
  Sir Cranley Onslow: The Committee has not yet had an opportunity to discuss the exchanges that the hon. Gentleman has had. I hope that he will not presume to anticipate the Committee's collective decision.
  Mr. Caborn: The right hon. Gentleman is a member of that Committee and knows that I do not anticipate anything, because things can go badly wrong. I assure him that all the information that has passed between the DTI and me over the past seven days will be presented for objective analysis. I hope that all members of the Committee will ensure its credibility by making sure that we have access to all the information because if we do not do that, our report will be inconclusive. That will depend on the House's decision, but if the Select Committee is asked to conduct an inquiry it will do a thorough job.
  5.36 pm
  Sir Nicholas Bonsor: I agree with my right hon. Friend the President of the Board of Trade. Plainly, we do not wish to have another long inquiry. We must dispose of this matter briskly and ensure a swift conclusion that the House can consider. The best way to

  55
  do that would undoubtedly be for the Select Committee to look into the issue. As Chairman of the Select Committee on Defence, I can endorse all that the President said about the impartiality of Committees. I assure him that Conservative and Opposition Members rigorously scrutinise what Ministers tell them.
  I should like to put the debate into its wider context. In one year, 1993, we exported £7 billion-worth of arms. I totally disagree with my hon. Friend the Member for Buckingham (Mr. Walden) who, unfortunately, is not in the Chamber. More than 500,000 people are involved in arms production. Our armed services need to be able to use British equipment where possible. We need the best equipment, and we can afford to produce it only if we succeed in exporting arms because that supports the logistics and the necessary research and development. The idea that we should cut our arms supplies is absurd, and would cause deep and lasting damage to our country.
  We should compare the £7 billion-worth of arms exports in 1993 with exports to Iran and Iraq in the 1980s. During that entire period, exports to Iran totalled £35 million, while those to Iraq amounted to some £569 million. That was over 10 years, and when it is contrasted with the exports in 1993 one sees the relative insignificance in terms of money and equipment that the House is debating.
  In 1987, there were some 98,000 applications to obtain the necessary licences under the then rules, and only a handful succeeded. It is not surprising that the Department of Trade and Industry was inundated with such work and that its officials occasionally allowed something to slip through.
  Project LISI is the title of the BMARC export that we are debating. No one has yet mentioned that when the contract for that was signed the project was being handled by, and BMARC belonged to, Oerlikon, which is a Swiss company. It was not until nearly two years after that contract was entered into that the new management of Astra, headed by Mr. James, bought BMARC and continued with that contract.
  As I understand it, in 1988 the intelligence community realised that Oerlikon—not a British company—was exporting arms via Singapore to Iran but it did not specifically mention BMARC. It is again, therefore, not surprising that, in this very complicated net of applications and other matters which were being examined by the intelligence community, the DTI and the MOD, a comparatively small contract might have slipped through.
  I should like to move on from that as I appreciate that I have only a minute or two to deal with two specific issues that have been raised this afternoon. The first relates to my right hon. Friend the Chief Secretary to the Treasury. He has come under attack on three bases.
  First, The Independent newspaper, which normally I think is reliable and accurate, has today published one of the most appalling and inaccurate headlines that I have read in the media, saying that papers showed that "Aitken knew" about the arms deal. Nothing in the text of that article or what anybody has said—there is no evidence from any source whatsoever—suggests that that is an accurate statement. My right hon. Friend has categorically denied it. For a national newspaper to use such a headline is irresponsible, and journalism of the worst kind.
  56
  The second attack on my right hon. Friend, which was made by the Opposition Front Bench, can be summed up in the words, "If he did not know, he certainly should have known." I am sorry that the right hon. Member for Copeland (Dr. Cunningham) is not here, but I have no doubt that he will read the report. If he were here, I would ask him to tread very carefully when lecturing the House about the duties of non-executive directors. I happen to know that the right hon. Gentleman is a non-executive director of two chemical companies. I know nothing against the activities of those chemical companies, but I will wager that some of the contracts undertaken by those companies have been made without the express knowledge of any of the non-executive directors.
  Mr. David Shaw: The right hon. Gentleman is an adviser to those companies.
  Sir Nicholas Bonsor: I have been corrected. He is an adviser, not a non-executive director. None the less, I am sure that, if the right hon. Gentleman is doing his job in advising those companies, he should know what is going on in them. It is precisely that sort of relationship that Lord Nolan, in my view perfectly properly, attacks.
  Nothing said in this debate or in the press justifies the sort of behaviour which has been shown from those quarters towards my right hon. Friend. I hope that the House will accept the word that he has given that he did not know what happened and allow him to get back to the excellent job that he is doing as Chief Secretary to the Treasury.
  In the few minutes that I have left—
  Mr. Richard Ottaway: Two minutes.
  Sir Nicholas Bonsor: In the two minutes that I am told I have left, I shall move on to the issue of Mr. Gerald James. Unlike most hon. Members, I have met Mr. James. He provided a lot of papers to me about the Iraqi gun affair when I was appointed Chairman of the Select Committee on Defence, and asked me to instigate the inquiry into it. I told the House that I was deeply disturbed by some of the things that I saw. I did not feel that the Defence Committee had the proper resources to look into that matter. After discussion with the other members, I passed all those papers on to Sir Richard Scott.
  I believe that Mr. James has been treated very badly. His misfortune was that his very successful company, Astra, made two unfortunate purchases—BMARC and the other company that supplied the Iraqi gun, PRB. Those purchases led him to disasters with which he was not equipped to deal. He was treated badly by certain members of the Administration, with or without the Government's knowledge. That is something Sir Richard Scott is going to look at, not something for the House to comment on today.
  I hope that we will follow the advice of my right hon. Friend the President of the Board of Trade to refer the matter to the Select Committee on Trade and Industry, and that the Committee will look into the matter.
  5.46 pm
  Mr. Nigel Jones: We are debating a very serious matter. The President of the Board of Trade told us in his statement on Tuesday 13 June:

  57
  "it does appear that there may be grounds for believing that the final destination of naval cannon made by BMARC could well have been Iran."—[Official Report, 13 June 1995; Vol. 261, c. 596.]
  That must be one of the biggest confessions ever made in the Chamber that was not followed by a resignation, the establishment of a full independent inquiry or even the slightest acknowledgment of ministerial responsibility.
  The arms embargo during the Iran-Iraq war was there for a purpose. I was working in Baghdad at that time on legitimate civilian business, with the full backing of the DTI. Now we are told that, during that time, the DTI was approving the export of arms to fuel the already devastating war in that region. Examples like that, combined with allegations of British troops facing British weapons in the Gulf war shortly afterwards, contribute to the accusations of disgraceful hypocrisy and illegality in British foreign policy. If the Government believe those allegations to be false, an independent inquiry is surely the best way to prove it.
  The question of illegal arms sales from Britain to Iran in the mid to late 1980s has, so far, been too narrow in its focus. Of course, the Chief Secretary to the Treasury has still to convince anyone of his innocence in this affair, but to concentrate purely on his role as a non-executive director is to miss the point. The real investigation goes far beyond that. The roles of the DTI, the Ministry of Defence, the Foreign Office and the intelligence services must all be probed in the fullest possible detail if the truth is to be discovered.
  A vast array of evidence suggesting serious wrongdoing has been put together, mainly by the media, whom I congratulate on their digging. The denials of the accused have varied from the unsatisfactory to panic. The result is a general air of suspicion that will not go away simply because one Minister cannot remember and another was not even there at the time. If we are to avoid the sort of trial by media that the Chief Secretary so abhors, the plethora of unanswered questions that surrounds the affair must be answered in the appropriate forum.
  What are the unanswered questions? Why has it taken the Government so long to put two and two together, considering that the vital clues that prompted the President of the Board of Trade's suspicions were both available in the 1980s? Why have we had to wait seven, eight or nine years for the issue to be addressed? Should not the DTI, with advice from the Ministry of Defence and the Foreign Office as well as the intelligence services and Customs and Excise, have been able to smell a rat at the time? Did the Government really think that the amount of munitions—140 naval guns exported in project LISI—could all be wanted or needed by the navy of Singapore? I represent GCHQ and it is inconceivable that the high standard of intelligence gathering in this country could have missed something as important as the breaching of an arms embargo to Iran.
  To what degree should Ministers accept responsibility for the failings of the export control procedures and the breach of the arms embargo? Given reports that Mr. Stephan Kock, one of the co-directors, gave representatives of MI6—with which he had close contacts—a tour of BMARC's factory showing part of the project LISI exports, what exactly was the role of the intelligence services and why did Ministers apparently ignore the advice that they were given? Were the errors made in granting export licences the result of a conspiracy or a cock-up? If those and countless other questions are
  58
  to be answered, an inquiry with the necessary resources and the right of access to all relevant information must be established.
  If the role of the Chief Secretary is to be ascertained, it is only right that he be given the opportunity to give evidence to such an inquiry. There appears to be some uncertainty and possible contradiction in his account of events in BMARC between 1986 and 1988.
  For example, how is it that, according to the minutes of BMARC's board meeting on 2 November 1988, it appears that the Chief Secretary made a contribution to discussions at a point after he claimed to have left the meeting? How is it that he failed to read the company's progress report circulated to the board meeting on 28 February, a meeting that he personally attended? This sits very oddly with the Chief Secretary's claim that he took all steps to become well briefed on the company's activities. The Chief Secretary chose to be a director of the company. He shares the corporate responsibilities of all directors and, as a director, he must be presumed to know of the very important contract in question.
  It may be that the Chief Secretary is right and his boardroom colleagues are mistaken, but, until the investigation is taken away from the media and given to an official inquiry, the Chief Secretary cannot hope to use his simple sword of truth or his shield of fair play. In the light of this weekend's developments, the onus is still very much on the Chief Secretary to prove that he was unaware of what BMARC was up to. There have been contradictory statements.
  Establishing the appropriate means of investigation is something that the Government have so far done everything possible to avoid. In view of the complexity and importance of the countless questions that must be answered, why did the President of the Board of Trade suggest that the Select Committee on Trade and Industry would be able to reach satisfactory conclusions with its limited resources if his own Department, with all its personnel and access to information, had failed to do so?
  The suggestion that the Select Committee should investigate the affairs of BMARC is as unrealistic as the Chief Secretary's request that Lord Justice Scott should look into the allegations levelled against him. The Select Committee and Lord Justice Scott have expressed the view that they are not equipped satisfactorily to investigate the affair. To expect them to take on the job, therefore, will be regarded as a whitewash and a sham.
  The questions that I have asked deserve investigation and answers. It is not good enough for Ministers to say, "Sorry, I can't remember anything," or "It wasn't me. I wasn't even there at the time." That is all we have been offered so far, but it does not wash. If that evidence was submitted to a court of law, I cannot help but feel that it would be dismissed on the grounds that the witnesses were unreliable.
  The idea that Ministers will not take responsibility for the failings of their own Departments is unacceptable to the British people and to the House. We now need a full, independent, judicial inquiry to look into the matter properly. I trust that the Government will not shy away from their responsibility to establish such an inquiry.
  5.52 pm
  Mr. Edward Leigh: I am the Member of Parliament whose constituency

  59
  includes the former BMARC factory at Faldingworth in Lincolnshire. The site is still operational under the new ownership of Royal Ordnance. It assembles shells and fills them with explosives, as it did under BMARC's ownership.
  My purpose in speaking today is to establish the fact that, in my view, none of my constituents or anyone involved in BMARC can be accused of wrongdoing. Certainly, there was no question of anyone knowing at the factory that the end user was Iran—shipping freight was simply marked with a code. However, nor do I believe that anyone higher up in BMARC management knew—certainly, a non-executive director could not have known.
  The contract for project LISI—the sale of 20 mm guns to Chartered Industries of Singapore—was very clear. BMARC sold the guns to Oerlikon, and not to Singapore, as it was required to do under their licence. Oerlikon shipped the goods to Singapore. Oerlikon in Switzerland, or possibly someone working in Chartered Industries in Singapore, passed them on to Iran without the knowledge of BMARC's staff or management. BMARC was prohibited from trading not only with Iran but with Singapore under the terms of its licence with Oerlikon.
  Mr. Jim Cousins rose—
  Mr. Leigh: No, I shall not give way as I have only 10 minutes.
  I have documentary proof. I have obtained from within the factory copies of the licence put together for the receiver of the company on 28 February 1992. They are, as far as I know, hitherto unpublished—perhaps they are some of the missing documents, but I do not know. They are marked "Private and Confidential". Exhibit 1B states:
  "The following manufacturing and selling rights are granted by Oerlikon to BMARC under the terms and conditions of the Licence Agreement for the below listed material:—
  —Exclusive manufacturing rights in the UK.
  —Exclusive sales' rights to the Government of, as well as other end-users in, the UK.
  —Exclusive sales' rights for worldwide naval applications, except for the countries listed in Exhibit 2".
  Exhibit 2 states:
  "In the following countries Oerlikon will be the sole distributor for all the Material listed in Exhibit 1B. Therefore BMARC is not entitled to sell any of the Material either directly or indirectly in the below listed countries.:

  —Cyprus

  —India

  —Malaysia

  —Singapore

  —Sri Lanka

  —South Korea

  —Taiwan

  —Iran

  —Saudi Arabia

  —all Latin American countries".

  The licence is quite clear, but I have today double-checked at some length with Dr. John Pike, the former armaments director in the relevant period and the former managing director of BMARC, as well as with trade union representatives of the work force in my constituency.
  60
  As far as anyone in the company was concerned, Singapore was the end user of the goods. That was a perfectly legitimate assumption, given that BMARC did not have any direct contract with Singapore. The Singapore navy already possessed these guns and was expanding.
  Chartered Industries of Singapore to which the guns were sent by Oerlikon—not by BMARC—was Government-owned and was a proper and legitimate, and likely, recipient of them. However, because the guns were not being sold directly to the Singapore navy, Major-General Donald Isles, a highly respected, responsible and competent former Ministry of Defence employee, and the other full-time directors checked carefully.
  There was no reason for them to indulge in shady deals. Why should they risk acquiring a possible criminal record for a deal? In addition, BMARC was a highly respected and successful British company and did not need to break DTI guidelines. Having checked carefully with the DTI, whose officials apparently had the full information at their fingertips, there was no doubt in the minds of the directors that the end user was Singapore, not Iran.
  My point is that, if the DTI, with all its specialised resources, did not manage to second-guess the deal, how could a non-executive director such as my right hon. Friend the Chief Secretary?
  What about Gerald James? He may indeed have a legitimate grievance—he brought down Astra and BMARC through his misjudgment in buying PRB, and was no doubt sold a con by the Belgian Government—but, as a result of that grievance, he is undoubtedly pursuing a campaign—some might say, a vendetta—against the British Government. Because my right hon. Friend happens to be a member of the Government, he is the target of that campaign.
  When Mr. James was asked by Mr. Peter Snow on the BBC's "Newsnight":
  "Did you … at any time brief him"—
  my right hon. Friend—
  "personally about the nature of the Singapore contract?",
  he said:
  "No I did not brief him personally at all."
  I have, from my own sources within the company, obtained more information. After he took over the company, Mr. James apparently took the opportunity when the remaining Swiss employees were out of the company offices for their national holiday to check their papers. He could find no evidence that the guns were going anywhere other than Singapore. I submit that, at the relevant time, no one in BMARC—certainly not the staff or my constituents, or the non-executive directors—had any clue that the goods were going anywhere but Iran—[Interruption]—Singapore. I apologise, that was a slip of the tongue. They were clear that the goods could have gone only to Singapore, not Iran.
  In any event, my right hon. Friend joined the company only in 1988 when the contract was already well advanced. It was signed in 1986 and, by 1990, my right hon. Friend had resigned. According to Dr. Pike, to whom I spoke today, it would have been dealt with only in the most cursory fashion, if at all, at any board meetings that my right hon. Friend attended—for example, to check that the goods had been delivered to Oerlikon.

  61
  There may or may not have been some incompetence on the part of DTI officials—we shall no doubt find out about this—in not making the connection between the Singapore deal and the known fact that Oerlikon was selling to Iran. However, if full-time experienced DTI and intelligence service officials could not make such a connection, I cannot see how my right hon. Friend could have done so.
  In any event, he has given his word to the House. He is a much-admired and competent Minister. We should accept it, but the evidence that I have found and that others have alluded to is overwhelming. It shows that he did not know and could not have known. On the contrary, we should back my right hon. Friend and what was an excellent British company, run by extremely responsible and respectable people such as Major-General Donald Isles.
  My right hon. Friend is a victim of a discreditable witch hunt by the Opposition and media. He should and must stand his ground, so that truth and honour will be the touchstone by which we conduct our affairs, and not personal vindictiveness and innuendo.
  5.59 pm
  Mr. Allan Rogers: I must admit that I have not heard in this House a more flimsy defence of any situation than the one that we have just heard from the hon. Member for Gainsborough and Horncastle (Mr. Leigh). He accuses us of pursuing a vendetta, but may I put just one point to him? The statement to the House of the Secretary of State for Trade and Industry has brought about today's debate; it was not the Opposition chasing the issue. For what reason did the President of the Board of Trade want to bring it back to the House?
  I say this not with any particular hindsight, but because I might have been the first person in the House to raise this issue. I did so back in 1989 when I was shadowing, as I had been for a number of years, the defence procurement portfolio when it was held by the right hon. Member for Hove (Sir T. Sainsbury) and, later, Alan Clark. At that time, it was fairly obvious that something was wrong. If I had time, it would be easy to catalogue the responses I had, but I want to pick up one issue in the limited time available: the lost documents that seem to have become available this weekend.
  I find today's response by President of the Board of Trade as remarkable as the fact that those documents are suddenly available, that he suddenly finds a reason for bringing this matter forward, and that he suddenly finds the questions of my right hon. Friend the Member for Copeland (Dr. Cunningham) so stimulating that he finds that there is a gap in the intelligence.
  Let me just remind the House that an investigation into Astra/BMARC had been going on for three years. The response to a question that I tabled last year revealed that the cost of that investigation was £2,170,000—more than £2 million had been spent on acquiring the information, and suddenly we are told that it was not available until last week.
  In response to a question that I tabled on 19 April last year, the hon. Member for Tatton (Mr. Hamilton) said:
  "The inspectors commenced work on appointment on 16 August 1990 and their report was signed on 7 April 1993"
  So all the information that is presently available was available all the time that these obfuscations were going on. The then Minister went on to say:
  62
  "the inspectors considered substantial representations received during the course of fairness procedures."—[Official Report, 20 April 1993; Vol. 223, c. 74.]
  Mr. John Anderson has again been heavily featured in the media this weekend. In relation to the lost papers, when he was Minister of State for Defence Procurement, the right hon. Member for Thanet, South told me:
  "Mr. Anderson was arrested by the Ministry of Defence police … in April 1990. He was detained in connection with a possible case of corruption, interviewed and released without charge. Subsequently, he made a number of complaints concerning the circumstances of his arrest. These have been investigated in accordance with the Police and Criminal Evidence Act 1984 and the report currently rests with the Police Complaints Authority whose decision is awaited."—[Official Report, 26 April 1993; Vol. 223, c. 298.]
  Those papers relate to BMARC and Astra, the company run by Mr. John Anderson, who was a director at the same time as the right hon. Member for Thanet, South. I find it incredible, therefore, that the information is seemingly suddenly available, as it was supplied to me more than a year ago, and after nearly £2 million had been spent on that report.
  The issue of arms exports to the middle east and elsewhere has come about because of a change of culture in our political life during the 1980s. An hon. Member asked for an investigation into arms exports. He probably was not aware, although it was pointed out to him later, that the Select Committee on Trade and Industry had considered the issue—specifically in relation to Iraq, I warrant that, but also in relation to other issues, such as the uses and applications of licences.
  If we put it into context, in 1984 in this country there was a tremendous charge for arms exports. I am not questioning the morality or otherwise of arms exports, but that charge for more and more exports generally existed throughout the Department of Trade and Industry, the Ministry of Defence, the Defence Export Sales Organisation, International Military Supplies, and even with the Prime Minister at the time. She accompanied her son, who took a rather lucrative part in these events, and batted for Britain—I cannot think of a better bat—in both Saudi Arabia and Malaysia to get these huge contracts.
  A general culture, going through Whitehall and the relevant Departments, allowed such instances to happen. All it requires is a greedy man or men to latch on to that culture or the lack of morality in relation to where arms were going.
  We should not forget that the guidelines controlling the export of arms were laid down by this Government—by Sir Geoffrey Howe—in 1984. One of the cardinal criteria was that arms should not go into regions with bad human rights records, and that they should not lead to warfare between countries. On many occasions, the then Secretary of State for Trade and Industry, the right hon. Member for St. Albans (Mr. Lilley), said that arms should not go into regions where they could be used in a way that cut across the Government's guidelines.
  The whole issue revolves around that change in culture. It is about arms going not only via Singapore into Iran but into many other areas. The then Foreign Secretary, Sir Geoffrey Howe, said:
  "We should maintain our consistent refusal to supply lethal equipment to either side"
  in the Iraq-Iran war that was going on at that time. That was flagrantly broken by members of his own Government. He also said:

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  "We should not, in future, approve orders for any defence equipment which, in our view, would significantly enhance the capability of either side to prolong or exacerbate the conflict".— [Official Report, 29 Oct 1985; Vol. 84, c. 450.]
  That guideline was again broken by the Government.
  On reflection, probably the only honest man in the whole affair was the then Minister for Defence Procurement, Alan Clark, who has left this House. At least he always made it clear what he was about, and made no apologies for the fact that he knew that arms embargoes were being broken. He said that that was because it was bringing jobs to this country.
  I am amazed that the Chairman of the Select Committee should support that view this afternoon. If there are jobs out of people being killed or murdered in other parts of the world, we should not have such jobs in this country. If there is to be an inquiry into arms exports, the first thing we should consider is the morality of it.
  People are trying to suggest to us that there are only two options; either it was a cock-up or it was a conspiracy. I believe that it was both. The general climate in the Government Departments I have named, and the inefficiency and incompetence of the Department of Trade and Industry, allowed those who were conspiring to break the arms embargo to carry out that dirty, sordid business, as I pointed out to the then Prime Minister, Baroness Thatcher, in 1989 and to the present Prime Minister in 1992—
  Mr. Deputy Speaker: Order. Time's up.
  6.9 pm
  Sir David Mitchell: The motion refers to the BMARC affair, which is concerned with arms for Iran. The reality is that the motion is a malicious attempt by the Opposition to destroy the reputation and career of my right hon. Friend the Chief Secretary to the Treasury.
  There are certain facts that should be brought to the attention of the country and the House. In 1986, BMARC was a Swiss-owned company, and it was at that time that it signed the offending Singapore contract. In 1988, the company was bought by Astra, a British company. In the same year, my right hon. Friend the Chief Secretary was made a non-executive director, a post in which he remained for only 19 months. In practice, non-executive directors are not much more than advisers to the board; they have no powers to interfere in the management of a business.
  I now turn to Mr. Gerald James, the chairman and the source of the suggestions that my right hon. Friend knew about the contract. I draw the House's attention to an article on page 25 of The Economist this week, which says:
  "Mr. James says that a group of senior figures at BMARC knew all about these fishy contracts yet thwarted his efforts to find out what was going on."
  If the chairman did not know what was going on and if the chairman was thwarted in his efforts to find out, how on earth could a temporary, non-executive director be expected to find out and to know?
  My right hon. Friend the Chief Secretary has no case to answer. The House should accept the Government's amendment as a cost-effective and speedy way in which to clear the matter up.
  6.11 pm
  Mr. Jim Cousins: The matters before us are serious, but we should not jump to conclusions. What is highly significant is that the Chief Secretary to the Treasury—I do not think that we should dwell on him—shared with the nation on "Question Time" last Thursday the information that he had been briefed that some of the contracts involved were for the Singapore navy. That contradicts the argument put forward by the hon. Member for Gainsborough and Horncastle (Mr. Leigh) that none of the contracts was the responsibility of BMARC itself. If BMARC was simply producing the items and could not sell them, why was it applying for export licences for the relevant items?
  The entire matter was exhaustively dealt with in the Department of Trade and Industry report on the Astra group of companies. The report makes it crystal clear that the licence agreement that Oerlikon had with BMARC, which Astra inherited when it took over, did not mean that BMARC—and Astra subsequently—was not the promoter of the sales, albeit that the goods were being produced under a licence agreement with Oerlikon. Those are important matters, which we must seek to get to the bottom of.
  The Select Committee on Trade and Industry will face a number of considerable difficulties. First, there is the quantity of information. Some 1 million documents are said to have been removed from the Astra group of companies, either by DTI inspectors, from 1990 onwards, or by Ministry of Defence police. That is a formidable and overwhelming task of investigation. It took the DTI almost three years to produce its report on the Astra group of companies—never mind the efforts of a Select Committee, which will face other lines of inquiry.
  The Select Committee will immediately confront the difficulty of intelligence information. It has had an offer from the Chairman of the new Intelligence and Security Committee, but the difficulty is that he was the Secretary of State for Defence at precisely the time when the Ministry of Defence police were going into the Astra group of companies to lift the information. That is a difficulty—a contradiction.
  The Select Committee will face the puzzle of understanding why, if the Government did not know about arms sales to Iran, a wholly owned Government company, International Military Services Ltd., had an office in Iran that was open throughout the entire period of the first Gulf war between Iran and Iraq. Those are difficult matters to inquire into.
  Another problem, sadly, is the unfortunate coincidence that the company that dealt with the receivership of Astra—Coopers and Lybrand—had a historic connection with Sir Kenneth Cork, who, unfortunately, is no longer with us; I am conscious of what I am saying in this regard. Sir Kenneth had a business connection with the Chief Secretary through his company Aitken Hume International.
  Another difficulty is that all the investigations into Astra have been carried out, to some degree, by the Department of Trade and Industry through its inspectors, who took three years to report. Only a year after it had had that report did the Department of Trade and Industry decide to prosecute all but one of the directors of Astra. That legal case is still before the courts. I have a question for the Government. Can they give an assurance that, if a

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  further case, which will cut across many inquiries, comes to court, they will not use the public interest immunity certificate suppression system, although they used it in the Matrix Churchill trial?
  These are weighty and serious matters. Although we cannot leap to conclusions, we have here a mystery within several other mysteries. We have to seek the answer to the question why a full explanation of matters has never been given to Parliament.
  Only tonight, in a parliamentary answer that I have just received and hardly had time to take on board, is it revealed that, of the 224 private export licence applications submitted by BMARC between 1986 and 1989, 149 had no supporting information about end users. That figure is 66 per cent., and not the 36 per cent. that was used by the President of the Board of Trade in his statement to the House. There is confusion and obfuscation about such a simple matter; the matters under investigation are far more serious.
  The issue of Iran and Iraq is not some marginal matter, but one that took up the time of Governments and Departments, as we know from the Scott inquiry, through much of the 1980s. It is one of the great secrets of the 1980s, and it will, sadly, take far more, as I know to my cost as a former member of the Select Committee on Trade and Industry that investigated arms to Iraq, than a Select Committee inquiry to get to the bottom of these very murky affairs.
  6.18 pm
  Sir Jim Spicer: It is right and proper for the Opposition to make as much of this matter as they can. I remind everyone in the House, however, that that bloody and bitter war lasted for eight years, and that during that war, many countries supplied both Iran and Iraq with massive amounts of weaponry. At the top of the list of suppliers to Iraq were the Soviet Union and France.
  Most hon. Members will know that the French Government—or the French—are still owed some £12 billion for arms supplied during that war. My hon. Friend the Member for Upminster (Sir N. Bonsor), the Chairman of the Defence Select Committee, made it quite clear that, compared with such a scale of supply of arms to both protagonists in that war, what we were doing was on the margin: £75 million to Iran and, over a ten-year period excluding the war—a large part of that period—about £500 million to Iraq.
  During that period, Iran and Iraq scoured the world for weapons, and there have been many revelations of just what happened in other countries. At the top of the list of arms suppliers during that time were Austria, under a socialist Government, Belgium, under what to all intents and purposes was a socialist Government, and Sweden under a socialist Government. They have all had scandals involving such sales. Therefore, it is no surprise that parent companies such as Oerlikon should make use of subsidiaries in this country to pursue their lucrative trade with either Iraq or Iran.
  My hon. Friend the Member for Gainsborough and Horncastle (Mr. Leigh) has made BMARC's situation and the relationship with Oerlikon absolutely clear. May I remind the House that the war between Iraq and Iran ended in August 1988? It was not until September 1988 that my right hon. Friend the Member for Thanet, South (Mr. Aitken), the Chief Secretary to the Treasury, became a non-executive director.
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  I am sorry that the right hon. Member for Copeland (Dr. Cunningham) is not present. His remarks were not only unfair but showed a total lack of knowledge about the role of a non-executive director of any company whatever.
  Mr. Rogers: Will the hon. Gentleman give way? Sir Jim Spicer: I am sorry, but I do not have time.
  If I had been appointed a non-executive director in September 1988, I would not have known about the affair, because the contract was complete, with one shipment still to go. That one shipment went out through Oerlikon. That is a fact which can become public knowledge, and I hope that it will come before the inquiry when it is held.
  The Opposition are asking for an outside independent inquiry. All the evidence of the Scott inquiry shows that such an inquiry would be precisely the wrong way in which to conduct our affairs and to achieve natural justice for those who appear before it, to which they are entitled. There can be no valid reason for any inquiry in which one person becomes the prosecutor, the judge and the jury. The result is muddle and delay. As my right hon. Friend the President of the Board of Trade made quite clear in his speech, there would be delay on a massive scale, which is exactly what the Opposition have said today that they do not want.
  Let us have faith in ourselves, conduct our own investigation through the Select Committee on Trade and Industry, and, in the light of its report, decide what we should do.
  6.22 pm
  Mr. Brian Wilson: We have heard Conservative Members put some pretty wafer-thin arguments this afternoon, but the previous speech excelled. It is astonishing at times such as this how limited, in the view of Tory Members of Parliament, is the role of non-executive directors. As for the Scott inquiry being the wrong way to conduct "our affairs", it might be the wrong way for Conservative Members to conduct their affairs—one can understand their reservations about the Scott inquiry—but Labour Members think that it is a very good way in which to conduct our affairs, the nation's affairs, to get at the truth about complex issues.
  We also heard the hon. Member for Gainsborough and Horncastle (Mr. Leigh) put a remarkable defence that the affair was all beyond the reach, knowledge or control of Parliament because a Swiss company was involved initially. Of course it does not matter who owns the company; it is where the arms are manufactured that is critical for export licences. We have heard a very thin—
  Mr. Rupert Allason: Will the hon. Gentleman give way?
  Mr. Wilson: I must remind the hon. Gentleman that, for the second time recently, the Government have breached the Jopling rules by arranging to make a statement on an Opposition Supply day. I certainly do not intend to give very much of my time to interventions.
  Mr. Allason: One point.
  Mr. Wilson: I do not think that the hon. Gentleman even attempted to catch Mr. Deputy Speaker's eye. He is certainly not going to waste my time.

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  I want to ask the hon. Member for Dorset, West (Sir J. Spicer) a question. He said that, if he had become a non-executive director of BMARC in 1988, he would have known nothing of contracts entered into in 1986. He appears to consider that a proud boast. But would he, for instance, have known anything of BMARC contracts entered into in 1989, such as the contract to supply fuses to Iraq worth £3 million, via Jordan as a conduit? Would he have regarded that as being any of his business as a non-executive director? If the answer to that is also no, it tells us more about the hon. Gentleman than it does about the duties of non-executive directors.
  Sir Jim Spicer: If I were a non-executive director, I would not be running the company on a day-to-day basis. I would have a brief report on the work of the company. The board meeting that I would attend would be—perhaps—two hours long and cover a whole range of subjects. The executive directors would have the responsibilities.
  Mr. Wilson: We understand that, but the hon. Gentleman chose to raise the role and duties of non-executive directors. I asked him a specific question about whether he would have seen it as his duty to know anything about where orders for £3 million worth of fuses were going, when they were going to one of the world's most lethal trouble spots in breach of his Government's rules and laws on the export of arms.
  Mr. Harry Cohen: My hon. Friend is really touching on the defence of the Chief Secretary to the Treasury, which is basically that he was on the board but did not know about such contracts, especially the LISI project. Is not the real problem that a number of BMARC contracts have ended up in Iran or Iraq and that the response of the Chief Secretary to the Treasury is that he was on the board, but did not know about them? Does not that weaken the right hon. Gentleman's position enormously?
  Mr. Wilson: My hon. Friend makes his own point. I want to be absolutely clear that, to Labour Members, this debate is not about the Chief Secretary to the Treasury. It is about the firm BMARC and the inquiry into it. Any emerging information that either worsens or secures the position of the Chief Secretary to the Treasury is a by-product of that inquiry.
  The issue on which we shall shortly be asked to vote is quite specific. Conservative Members are not being asked to participate in some primary contest for the Tory party leadership or even to demonstrate their support for the Chief Secretary. Incidentally, we can all sympathise with the right hon. Gentleman in his discovery that fax machines, like swords of truth, are two-edged weapons. We are concerned about whether there should be an independent inquiry into what has become known as the BMARC affair.
  Mr. Allason: Will the hon. Gentleman give way?
  Mr. Wilson: No, I will not give way.
  The case for an independent inquiry similar to the Scott inquiry is, as we have demonstrated in the debate, unanswerable. We have not heard any worthy answers from Conservative Members. The outrageous conduct of Ministers—Ministers who still hold office—towards the
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  directors of Matrix Churchill forced the Government to establish the Scott inquiry, with a remit to investigate only matters related to arms for Iraq. All the prima facie evidence, including that referred to in the statement on Tuesday by the President of the Board of Trade, suggests that BMARC gives rise to questions as serious and as wide-ranging as Matrix Churchill and that arms for Iran is just as much a part of this filthy saga as arms for Iraq. The difference is that Ministers have managed to keep the lid on BMARC and arms for Iran for two years longer than was possible with Matrix Churchill and arms for Iraq.
  That success, if it is worthy of the name, should certainly not be rewarded with a process of scrutiny that is any less rigorous than that established under Lord Justice Scott. The President of the Board of Trade did himself no credit today, in a blatant piece of casuistry, when he said that an independent judicial inquiry would have to start with a blank piece of paper. Equally, the Select Committee will have to start with a blank piece of paper unless it is in receipt of the conclusions of the Scott report.
  The President of the Board of Trade mentioned a figure of £2 million, as if it were some exorbitant amount, for conducting the Scott inquiry. It is less than the single illegal order to which I referred a few minutes ago. What is the price of the sword of truth? How much is the country expected to pay to find out about the deceits and deceptions that were the stock in trade of the Government for such a long time? Two million pounds does not seem an excessive price for that process.
  The Ministers involved in the affair, including the President of the Board of Trade today, have been anxious to suggest that they are dealing with matters that belong to some distant period and that have left a legacy which regrettably now has to be dealt with; far-off events of which they knew nothing. The spate of cock-ups, leading to the suppression of evidence and the misleading of Parliament, in which we are invited to believe give the convenient impression that the matter is something that has nothing to do with Ministers today; that it is all in the past. That is a false impression.
  I do not intend to talk about what happened in the 1980s, because that is the proper material for an independent inquiry to deal with. I shall concentrate only on what has happened since the offices of Astra, the parent company of BMARC, were raided in April 1990.
  Last Tuesday, from this Dispatch Box, I asked the President of the Board of Trade a straightforward question, which he conspicuously failed to answer. I repeat it now. I said:
  "Does he accept that, as far back as 1990, the Ministry of Defence seized files from Astra, the owner of BMARC, as part of a fraud investigation? Those files referred to Astra and BMARC trade with Iraq and Iran. Were the files handed to the DTI then? If not, why not? If they were, why have we had to wait five years for this statement?"—[Official Report, 13 June 1995; Vol. 261, c. 605.]
  Tonight I add the words, "and this debate and this inquiry".
  Let me bring the summation of events right into the period when the right hon. Member for Henley (Mr. Heseltine) held his present office. On 27 January 1993, Detective Inspector Berry of the Ministry of Defence police wrote to the receivers for BMARC, ostensibly offering the return of
  "all the property seized from Astra holdings and subsidiaries during our inquiries into allegations of corruption."

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  Let us leave aside for a moment the clearly inaccurate use of the word "all". I should be interested to know who gave the political authority to Detective Inspector Berry to make that offer. I should like to know what consultation there was between the Ministry of Defence and the Department of Trade and Industry between the date in 1990 when the raid on the Astra offices took place and 27 January 1993, when the offer, ostensibly to return everything that had been taken, was made.
  It is beyond peradventure that the material taken from the offices—all the material, the totality of the material—could have painted a full and startling picture of BMARC's activities during the years in question. It would have brought BMARC within the ambit of the arms to Iraq as well as the arms to Iran inquiries. It would have provided vital information about the role of the intelligence services in facilitating Britain's role as gun runner to the world.
  So is it conceivable that the material was merely offered for return to the receivers without its full import being assessed at the highest levels of government and then acted upon? The question is rhetorical. The answer is no, it is not conceivable. The Prime Minister announced the setting up of the Scott inquiry in November 1992. By that time, the researches of the Ministry of Defence police were well advanced. The material obtained from BMARC was in the possession of the Government. Will the President of the Board of Trade confirm that, from that day to this, the Ministry of Defence has returned none of the material that it took from the offices of Astra or BMARC to the Scott inquiry?
  Will the right hon. Gentleman confirm that the indictment is even more serious? Will he confirm that the Scott inquiry was set up with a remit restricted to arms to Iraq, to which Lord Justice Scott has subsequently adhered, to the exclusion of the BMARC affair, at a time when Ministers knew that what was in the BMARC papers—the President of the Board of Trade's statement last week was the merest tip of the iceberg—should have led to the Scott remit being widened to include both BMARC and arms to Iran? That is what the Government frustrated, not in the late 1980s but right up to the mid-1990s.
  Mr. Rogers: My hon. Friend is rightly cataloguing what has been going on. I am not sure whether he heard my speech, in which I quoted an answer given to me by the hon. Member for Tatton (Mr. Hamilton), who was a Minister in the DTI at the time, to the effect that the cost of the DTI's own investigation into Astra over a three-year period had come to £2,170,000. Perhaps the President of the Board of Trade ought to look into where that money went if it did not provide him with sufficient information to answer my hon. Friend's question last week.
  Mr. Wilson: My hon. Friend makes his own point well. The thrust of what I am saying is that the information was there. It was in the possession of the Government if they had wished to use it. [Interruption.] The hon. Member for Torbay (Mr. Allason) says that that is irrelevant. It is highly relevant.
  Mr. Allason: I said no such thing. I said that there was not a shred of evidence and you know it. Furthermore, the debate this afternoon is a disgrace. You have not been able to bring home the bacon.
  Mr. Deputy Speaker (Mr. Michael Morris): Order. Members on both sides should address each other as hon. Members, not "you".
  Mr. Allason: Would the hon. Gentleman care to answer this question? Does he agree that the sole issue here is whether end user certificates were misused? If that is the case, does he have the slightest evidence that any one director of BMARC knew that those end user certificates would be misused? The answer clearly is no, and the hon. Gentleman knows it.
  Mr. Wilson: The hon. Gentleman does not come to the Chamber very often and cannot be expected to know the rules. If he has been busting a gut to get in with that intervention for the past 10 minutes, he really has problems. If he thinks that that is the sole issue, he is very much mistaken and he will find out a great deal to his cost.
  Will the President of the Board of Trade confirm that it is essential that all the documentation—this is the reply to the hon. Member for Torbay—removed from the offices of Astra and its subsidiaries should be at the disposal of the independent inquiry that we seek tonight? That includes the documents that so mysteriously turned up at the weekend, but not only those documents. It includes the documents—there are plenty of them—which are still in the possession of the Ministry of Defence or the DTI and also those documents that have already been returned to the receiver.
  The point made by my hon. Friend the Member for Newcastle upon Tyne, Central (Mr. Cousins) about the role of the receivers was well taken. Those documents, too, should be put into the hands of an independent curator in order that there can be no question about their total, unqualified availability to those who are charged with inquiry into the affair.
  Now we come to the nub. When the Minister sums up, we shall want an answer to the question whether all the papers taken from the offices of Astra and its subsidiaries will be at the disposal of the inquiries that are proposed. That is the absolutely crucial question. Any hedging on the answer will confirm our worst suspicions.
  Fortunately, on that point, if on no other, we have assistance from the Chief Secretary to the Treasury. I quote an extract from the transcript of the BBC's "Question Time" last Thursday. It runs:
  "Mr. George Robertson: 'Will they get all the papers, all the documents, MI6, and the rest?'
  Mr. Aitken: 'Yes, MI6, all the documents, they have been promised all the documents.'
  Mr. Dimbleby: 'This has happened today, has it?'
  Mr. Aitken: 'Yes, today.'
  Mr. Robertson: 'And all the confiscated papers?'
  Mr. Aitken: 'Which are the confiscated papers? I didn't know there were any. I am sure they can get any papers they want.'"
  We have it on the authority of the Chief Secretary to the Treasury that the inquiry, under whichever auspices it is held, will receive all the papers, the intelligence reports and everything that it needs, including every bit of paper that was removed from the offices of Astra in 1990. We shall want to hear only one answer when the Minister replies to the debate. Does he stand by the promise of the Chief Secretary to the Treasury in that respect or does he not? Will every bit of paper be available to the inquiry or will it not? Those are the only answers on which the Minister will be judged.

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  Let me deal briefly with the position of the Chief Secretary to the Treasury. First, I should sympathise with him over his weekend difficulties with a fax machine. A rather dire message from someone who was apparently trying to help him was faxed to an art dealer in north London. That public-spirited gentleman then supplied it to the public prints. How ironic that the Chief Secretary, who has spent years in cahoots with arms dealers, should have fallen foul in that way to an art dealer.
  When, as has now been confirmed, the Ministry of Defence failed to return all the BMARC papers to the receiver, the right hon. Gentleman was Minister of State for Defence Procurement. He is now a Treasury Minister and Customs and Excise is inquiring into the affairs of his former company. He is a Cabinet Minister, whose Cabinet colleague, the President of the Board of Trade, has authorised two inquiries into the company of which he was a director. Is there no level of conflicting interest at which the right hon. Gentleman will step aside—at least until the inquiries are completed—or will he continue to brass-neck it out for as long as he can get away with it? Will he wait, to quote the famous fax, for
  "the straw that breaks the camel's back"?
  I have a great deal of respect for the Select Committee on Trade and Industry and in particular for its Chairman, but the inquiry is patently not a job for it. It is too big, too complex and too forensic for the procedures of a Select Committee. The case for an independent inquiry, in parallel with the inquiry of Lord Justice Scott, is unanswerable. I warn Ministers that, if they successfully resist that request, it will be a pyrrhic victory. The questions will still be asked and the evidence will still emerge. Those who have sought to present themselves today as honest brokers will be recognised instead as those who have prevented, even at this late stage, a proper inquiry. They will be clearly identified as part of the problem rather than of the solution.
  The President of the Board of Trade should remember that the biggest cover-up in modern political history came to be known as "All the president's men". Meanwhile, let me assure the House that the questions will continue to be asked and the sword of truth will gradually turn in the proper direction.
  6.41 pm
  The Parliamentary Under-Secretary of State for Trade and Technology (Mr. Ian Taylor): This debate has been intriguing. From the Order Paper, it appeared to be a request for a public inquiry, but the way in which Opposition Front-Bench spokesmen have conducted the debate suggests that they do not want an inquiry. They want, instead, to prejudge everything. They have used the debate purely to make accusations based on flimsy evidence and make allegations against Ministers, past and present. They have used words such as "conniving" and other emotive words that are not fitting given that, last week, my right hon. Friend the President of the Board of Trade made it clear that certain information needed to be revealed to the House. He said that that information needed to be followed up in detail. He suggested that the Select Committee on Trade and Industry should look into the matter if it saw fit to do so.
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  The best speech today came from the Chairman of that Select Committee, who clearly understands the implications of what is at stake and has confidence in the authority of the House to take action when such matters are brought to its attention.
  Simply because things have happened differently from what people had thought, the automatic response should not be to reach for the nearest judge. The call for an inquiry is not some attempt to keep judges in work. It should not be used as an attempt to prolong inquiries year after year.
  The inquiry of the Select Committee on Trade and Industry will attempt, however, to get to the bottom of something that has been brought to the attention of the House. Its Chairman understood that and I am delighted that he addressed some of the substantive issues involved. I am also aware that, on behalf of his Committee, he is in correspondence with the President of the Board of Trade about some of the detailed matters that need to be settled. I hope that they will be settled before the inquiry begins. I understand that the Committee will consider its decision on Wednesday. We look forward to co-operating with the Chairman in pursuit of the attempt to get the documentation agreed.
  It may be only the second time that a Minister has offered a Select Committee, certainly the Select Committee on Trade and Industry, such information, but that is what we have done. We have offered the Committee an opportunity to look into the matter. We have agreed to co-operate with it as fully as possible. The details of the documentation will be available. Hon. Members should take those facts into account carefully when considering how to vote.
  Anyone in the House who believes that the authority of the House is sacrosanct should accept what two Chairmen of Select Committees have said today: Select Committees are ultimately responsible to the House. I was delighted that the Chairman of the Select Committee on Defence, my hon. Friend the Member for Upminster (Sir N. Bonsor), also said that Select Committees need to consider the matter and are quite capable of doing so.
  My hon. Friend the Member for Upminster also made the important point that the issue before the House is not whether arms should be exported. This country exports arms perfectly legitimately and our defence industry employs many people. As I understand it, Opposition Front-Bench spokesmen have never said that they would stop defence exports. I do not believe that that is their policy, but if it were it would certainly be of great interest to many constituencies.
  Dr. John Cunningham: It is not our policy.
  Mr. Taylor: I note that the right hon. Gentleman has kindly helped me by making it clear that it is not Opposition policy to stop defence exports.
  It is important to establish a licensing procedure and to ensure that it is followed as rigorously as possible. That procedure should enable officials to discover the ultimate destination of the products. All licence application forms have a box that clearly requests a statement about the end user and the ultimate consignee. The hon. Member for Newcastle upon Tyne, Central (Mr. Cousins) referred to such information, which on the face of it suggested that in 1988 Department of Trade and Industry officials were given an assurance by BMARC that the exports were destined for Singapore.

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  The thrust of last week's statement from my right hon. Friend the President of the Board of Trade was that officials, having been given that information, then failed, for reasons which, with hindsight, we consider were not justified, to connect it with the intelligence that was available to the DTI in 1988. That raises genuine questions about such licenses as well as questions of procedure. As my right hon. Friend the Secretary of State said this afternoon, and in relation to the Scott inquiry, the licensing rules have been tightened and adjustments made in the light of criticisms and the problems discovered.
  The right hon. Member for Copeland (Dr. Cunningham) made certain accusations about activities in the latter part of the 1980s. In one year, 1987, there were 98,000 applications for export requests and the simple connections were not made. That did not happen because Ministers did not want them to be made or because of some malicious attempt to evade export rules, but because of a cock-up. The fact is that life is simply not that exciting.
  Dame Elaine Kellett-Bowman: Not again.
  Mr. Taylor: My hon. Friend may disapprove of that phrase. I did not invent it, but it has been used in the circumstances. It is a good deal more accurate than some of the accusations of Opposition Members. Life is simply not as exciting as they would wish us to believe. It is fortunate that they have not been in government recently; otherwise, they might have discovered that.
  Mr. Rogers: The Minister has quite rightly drawn our attention to the importance of an effective licensing system to govern our arms export policy. Surely he accepts that part of the Opposition's argument is that at the time Ministers encouraged arms exporters to break the rules. The then Minister for Trade, Alan Clark, documented evidence, which has been submitted to the Scott inquiry, about how he invited people to his office and told them to fill in forms in such a way as to confuse officials. A politician did that, not Ministry officials.
  Mr. Taylor: Once again, the hon. Gentleman is indulging in allegations. The purpose of this debate is very clear, and it was stated by the right hon. Member for Copeland: it is whether there should be an inquiry, and what form the inquiry should take. If the hon. Gentleman wants to make allegations, he can do so in that context. The Department's willingness to produce documentation is evidence of our openness.
  Mr. Wilson: Time is getting on, and the Minister has not got round to dealing with my specific questions. Does he endorse the specific assurance given by the Chief Secretary on "Question Time" last Thursday about the total availability of documentation, including everything that was taken from Astra and the intelligence reports?
  Mr. Taylor: The President of the Board of Trade is having discussions with the hon. Member for Sheffield, Central (Mr. Caborn)—the Chairman of the Trade and Industry Select Committee—about the documentation that is required. The hon. Gentleman, as a responsible Opposition Front-Bench spokesman, will know that certain documents must be handled with caution. [Interruption.] I will not listen to accusations and have fingers pointed at me when Opposition Members know very well that Governments wishing to get intelligence from sources do
  74
  not reveal those sources immediately. The reality is simple—revealing intelligence sources risks lives, and Governments depend on their intelligence services.
  How that intelligence is then handled within Government is a proper matter for discussion. That is what the President of the Board of Trade referred to in his statement, and that is why my right hon. Friend is having discussions with the Chairman of the Select Committee about the documentation that is required, and how that can be handled to allow the Select Committee to start its inquiries. That is the right way to proceed. It is wrong for Opposition Members to point their fingers and jump up and down. They are attempting to cause difficulties which are likely to end—
  Mr. Wilson rose—
  Mr. Taylor: How am Ito reply to the hon. Gentleman if he keeps rising to make points that he clearly forget to make during his own speech?
  Mr. Wilson: This is precisely a point that I remembered to make in my speech. Is the Minister repudiating the statement made by the Chief Secretary to the Treasury on the BBC's "Question Time" last Thursday night—yes or no?
  Mr. Taylor: I am answering this debate on the basis not of television programmes that I did not watch but of information that the House has before it as a result of the statement made in the House by the President of the Board of Trade last week. As I have said, detailed correspondence is going on between the President of the Board of Trade and the Chairman of the Trade and Industry Select Committee. If the hon. Gentleman wishes to make specific allegations, I urge him to do so through the proper channels—the Trade and Industry Select Committee.
  This debate—even in the terms framed by the Opposition—is not about detailed allegations, but about whether there should be a public inquiry and about what form the inquiry should take. The most suitable way of progressing is to have an internal inquiry by the Trade and Industry Select Committee, which is then accountable to this House.
  Mr. David Shaw: Does my hon. Friend accept that the Opposition have no basis for saying that they know all about inquiries, because they resisted an inquiry into Monklands district council? In the last hour, it has been confirmed that serious allegations of corruption are to be referred to the police.
  Mr. Taylor: My hon. Friend has played a notable role in pushing for such inquiries into that matter. That is not the matter before the House this evening and I realise that you, Mr. Deputy Speaker, would stop my continuing on that subject. However, perhaps it does go to show that the desire for information to be made public is not always carried through in detail by Opposition Members in terms of their own affairs.
  We have an important responsibility to try to find out more about what might have gone wrong. The Opposition are going from pillar to post in their reactions, and they seem less like seekers of truth and more like seekers of sensation. The hon. Member for Cunninghame, North (Mr. Wilson) said that he wanted the House to have a
  "far more wide-ranging inquiry than anything that has been suggested today."—[Official Report, 13 June 1995; Vol. 261, c. 606.]

  75
  The Chairman of the Trade and Industry Select Committee has rightly said that most of his colleagues would like to see a sharp inquiry—one that should not be allowed to drag on, as a wide-ranging inquiry would. The right hon. Member for Copeland called for a seven-course banquet of an inquiry. He said that BMARC should be the subject of a fully independent inquiry, quite separate from the Scott inquiry. That new inquiry should have access to all the documents and reports relevant to BMARC, and should be headed by a judge.
  One effect of the right hon. Member for Copeland's suggestion would be that we would not know the results of the inquiry for years. The inquiry would incur vast costs, and would not even have the advantages that Lord Justice Scott had from looking into export licensing operations. That is not an argument in favour of a genuine inquiry into the facts. I never give up hope with the right hon. Gentleman, who is a smiling and charming person who listens to arguments. I wish him to listen to this argument.
  The right hon. Gentleman cannot really be saying that he wants to push the matter into the public domain with a judge and with all the panoply that we have seen with the Scott inquiry in order to seek the facts rapidly, because the result would be an expensive rigmarole. Why does not the right hon. Gentleman share the confidence of his hon. Friend the Member for Sheffield, Central in the Select Committee system, particularly a Select Committee under the chairmanship of one of his colleagues?
  One or two colleagues referred to my right hon. Friend the Chief Secretary to the Treasury. My right hon. Friend has made a clear statement to the House that he was not aware that goods were being exported through Singapore to any other country, including Iran. The House has a proper respect for statements made by Members of Parliament to the House, and the tradition of the House to respect such personal statements should be continued in the circumstances. I believe that my right hon. Friend made a clear statement and—as far as I am concerned—that is that.
  The hon. Member for Newcastle upon Tyne, Central picked apart a question to which I replied this afternoon, but it is a fact that the President of the Board of Trade made a perfectly accurate statement to the House last week. It is in keeping with the willingness of the DTI to provide full information that the information that the hon. Gentleman has received this afternoon is accurate in all respects. When the hon. Gentleman looks at the answer that is published tomorrow in Hansard, he will acknowledge that the average overall figure is 36 per cent.
  The hon. Member for Cunninghame, North challenged us about various documents found by the Ministry of Defence, but that is a proper matter for the inquiry and I do not intend to go into it this afternoon. The Ministry of Defence police have made a statement over the weekend, and those questions will continue. I am sure that the Trade and Industry Select Committee will look at that matter.
  I am afraid that we have not thrown much light on the key subject of whether there should be an inquiry. If Opposition Members were genuinely interested in getting the facts, they would have agreed with Conservative Members that the Select Committee system has been set up for this purpose. The DTI is clearly willing to provide evidence. In the circumstances, the sooner we can proceed to a short, sharp but accurate inquiry, the better it will be.
  76
  When the President of the Board of Trade and I first heard our officials' findings in relation to BMARC's exports to Singapore, we admit that we were in no doubt about their significance and we kept inquiring for further details. Initially, the President and I asked questions that had been mentioned in the media regarding accusations that were made at the end of March. There has been no sudden desire to ferret out information. We believed that a clear series of events should be examined in the public interest and that resulted in last week's statement to the House.
  I believe that it is the House's proper duty to take the matter forward and to ask the Select Committee to do its job. If it can do its job quickly, we will get to the facts and that will benefit all hon. Members.
  Question put, That the original words stand part of the Question:
  The House divided: Ayes 267, Noes 291

  Division No. 165]

  [7.00 pm

  AYES

  Abbott, Ms Diane

  Cohen, Harry

  Adams, Mrs Irene

  Connarty, Michael

  Ainger, Nick

  Cook, Robin (Livingston)

  Ainsworth, Robert (Cov'try NE)

  Corbett, Robin

  Allen, Graham

  Corbyn, Jeremy

  Anderson, Donald (Swansea E)

  Corston, Jean

  Anderson, Ms Janet (Ros'dale)

  Cousins, Jim

  Armstrong, Hilary

  Cunliffe, Lawrence

  Ashdown, Rt Hon Paddy

  Cunningham, Jim (Covy SE)

  Ashton, Joe

  Cunningham, Rt Hon Dr John

  Austin-Walker, John

  Cunningham, Roseanna

  Banks, Tony (Newham NW)

  Dafis, Cynog

  Barnes, Harry

  Darling, Alistair

  Barron, Kevin

  Davidson, Ian

  Battle, John

  Davies, Bryan (Oldham C'tral)

  Bayley, Hugh

  Davies, Rt Hon Denzil (Llanelli)

  Beckett, Rt Hon Margaret

  Davies, Ron (Caerphilly)

  Beith, Rt Hon A J

  Denham, John

  Bell, Stuart

  Dewar, Donald

  Benn, Rt Hon Tony

  Dixon, Don

  Bennett, Andrew F

  Dobson, Frank

  Benton, Joe

  Dowd, Jim

  Bermingham, Gerald

  Dunwoody, Mrs Gwyneth

  Berry, Roger

  Eagle, Ms Angela

  Betts, Clive

  Eastham, Ken

  Blair, Rt Hon Tony

  Enright, Derek

  Blunkett, David

  Etherington, Bill

  Boateng, Paul

  Evans, John (St Helens N)

  Bradley, Keith

  Ewing, Mrs Margaret

  Bray, Dr Jeremy

  Fatchett, Derek

  Brown, Gordon (Dunfermline E)

  Faulds, Andrew

  Brown, N (N'c'tle upon Tyne E)

  Reid, Frank (Birkenhead)

  Bruce, Malcolm (Gordon)

  Fisher, Mark

  Burden, Richard

  Flynn, Paul

  Callaghan, Jim

  Foster, Rt Hon Derek

  Campbell, Mrs Anne (C'bridge)

  Foster, Don (Bath)

  Campbell, Menzies (Fife NE)

  Foulkes, George

  Campbell, Ronnie (Blyth V)

  Fraser, John

  Campbell-Savours, D N

  Fyfe, Maria

  Caravan, Dennis

  Galbraith, Sam

  Cann, Jamie

  Galloway, George

  Carlile, Alexander (Montgomery)

  Gapes, Mike

  Chidgey, David

  Garrett, John

  Chisholm, Malcolm

  George, Bruce

  Clapham, Michael

  Gerrard, Neil

  Clark, Dr David (South Shields)

  Gilbert, Rt Hon Dr John

  Clarke, Eric (Midlothian)

  Godman, Dr Norman A

  Clarke, Tom (Monklands W)

  Godsiff, Roger

  Clelland, David

  Golding, Mrs Llin

  Clwyd, Mrs Ann

  Gordon, Mildred

  Coffey, Ann

  Graham, Thomas

  77

  Grant, Bernie (Tottenham)

  Michie, Bill (Sheffield Heeley)

  Griffiths, Nigel (Edinburgh S)

  Michie, Mrs Ray (Argyll & S Bute)

  Griffiths, Win (Bridgend)

  Milburn, Alan

  Grocott, Bruce

  Miller, Andrew

  Gunnell, John

  Mitchell, Austin (Gt Grimsby)

  Hain, Peter

  Moonie, Dr Lewis

  Hall, Mike

  Morley, Elliot

  Hanson, David

  Morris, Rt Hon Alfred (Wy'nshawe)

  Harman, Ms Harriet

  Morris, Estelle (B'ham Yardley)

  Harvey, Nick

  Morris, Rt Hon John (Aberavon)

  Hattersley, Rt Hon Roy

  Mowlam, Marjorie

  Henderson, Doug

  Mudie, George

  Heppell, John

  Murphy, Paul

  Hill, Keith (Streatham)

  Oakes, Rt Hon Gordon

  Hinchliffe, David

  O'Brien, Mike (N W'kshire)

  Hodge, Margaret

  O'Brien, William (Normanton)

  Hoey, Kate

  O'Hara, Edward

  Hogg, Norman (Cumbernauld)

  Olner, Bill

  Home Robertson, John

  O'Neill, Martin

  Hood, Jimmy

  Orme, Rt Hon Stanley

  Hoon, Geoffrey

  Parry, Robert

  Howarth, George (Knowsley North)

  Pearson, Ian

  Howells, Dr. Kim (Pontypridd)

  Pickthall, Colin

  Hoyle, Doug

  Pike, Peter L

  Hughes, Kevin (Doncaster N)

  Pope, Greg

  Hughes, Robert (Aberdeen N)

  Powell, Ray (Ogmore)

  Hughes, Roy (Newport E)

  Prentice, Bridget (Lew'm E)

  Hughes, Simon (Southwark)

  Prentice, Gordon (Pendle)

  Hutton, John

  Prescott, Rt Hon John

  Illsley, Eric

  Primarolo, Dawn

  Ingram, Adam

  Purchase, Ken

  Jackson, Glenda (H'stead)

  Quin, Ms Joyce

  Jamieson, David

  Radice, Giles

  Janner, Greville

  Randall, Stuart

  Jones, Barry (Alyn and D'side)

  Raynsford, Nick

  Jones, leuan Wyn (Ynys MÔon)

  Reid, Dr John

  Jones, Lynne (B'ham S O)

  Rendel, David

  Jones, Martyn (Clwyd, SW)

  Robertson, George (Hamilton)

  Jones, Nigel (Cheltenham)

  Robinson, Geoffrey (Co'try NW)

  Jowell, Tessa

  Roche, Mrs Barbara

  Kaufman, Rt Hon Gerald

  Rogers, Allan

  Kennedy, Jane (L'pool Br'dg'n)

  Rooker, Jeff

  Khabra, Piara S

  Rooney, Terry

  Kirkwood, Archy

  Ross, Ernie (Dundee W)

  Lestor, Joan (Eccles)

  Rowlands, Ted

  Lewis, Terry

  Ruddock, Joan

  Liddell, Mrs Helen

  Salmond, Alex

  Litherland, Robert

  Sedgemore, Brian

  Livingstone, Ken

  Sheerman, Barry

  Lloyd, Tony (Stretford)

  Sheldon, Rt Hon Robert

  Llwyd, Elfyn

  Shore, Rt Hon Peter

  Loyden, Eddie

  Short, Clare

  Lynne, Ms Liz

  Skinner, Dennis

  McAllion, John

  Smith, Andrew (Oxford E)

  McAvoy, Thomas

  Smith, Chris (Isl'ton S & F'sbury)

  McCartney, Ian

  Smith, Llew (Blaenau Gwent)

  Macdonald, Calum

  Snape, Peter

  McFall, John

  Soley, Clive

  McKelvey, William

  Spearing, Nigel

  Mackinlay, Andrew

  Spellar, John

  McLeish, Henry

  Squire, Rachel (Dunfermline W)

  Maclennan, Robert

  Steinberg, Gerry

  McNamara, Kevin

  Stevenson, George

  MacShane, Denis

  Stott, Roger

  McWilliam, John

  Strang, Dr. Gavin

  Madden, Max

  Straw, Jack

  Maddock, Diana

  Sutcliffe, Gerry

  Mahon, Alice

  Taylor, Mrs Ann (Dewsbury)

  Mandelson, Peter

  Taylor, Matthew (Truro)

  Marek, Dr John

  Timms, Stephen

  Marshall, David (Shettleston)

  Tipping, Paddy

  Martin, Michael J (Springburn)

  Touhig, Don

  Maxton, John

  Turner, Dennis

  Meacher, Michael

  Tyler, Paul

  Meale, Alan

  Vaz, Keith

  Michael, Alun

  Walker, Rt Hon Sir Harold

  78

  Wardell, Gareth (Gower)

  Wilson, Brian

  Wareing, Robert N

  Winnick, David

  Watson, Mike

  Worthington, Tony

  Welsh, Andrew

  Wright, Dr Tony

  Wicks, Malcolm

  Young, David (Bolton SE)

  Wigley, Dafydd

  Tellers for the Ayes:

  Williams, Ftt Hon Alan (Sw'n W)

  Mr. Jon Owen Jones and

  Williams, Alan W (Carmarthen)

  Mr. Stephen Byers.

  NOES

  Ainsworth, Peter (East Surrey)

  Day, Stephen

  Alison, Rt Hon Michael (Selby)

  Deva, Nirj Joseph

  Allason, Rupert (Torbay)

  Devlin, Tim

  Amess, David

  Dicks, Terry

  Ancram, Michael

  Dorrell, Rt Hon Stephen

  Arbuthnot, James

  Douglas-Hamilton, Lord James

  Arnold, Jacques (Gravesham)

  Dover, Den

  Arnold, Sir Thomas (Hazel Grv)

  Duncan, Alan

  Ashby, David

  Duncan-Smith, Iain

  Atkins, Rt Hon Robert

  Dunn, Bob

  Atkinson, Peter (Hexham)

  Durant, Sir Anthony

  Baker, Rt Hon Kenneth (Mole V)

  Dykes, Hugh

  Baker, Nicholas (North Dorset)

  Eggar, Rt Hon Tim

  Baldry, Tony

  Elletson, Harold

  Banks, Matthew (Southport)

  Emery, Rt Hon Sir Peter

  Banks, Robert (Harrogate)

  Evans, David (Welwyn Hatfield)

  Bates, Michael

  Evans, Jonathan (Brecon)

  Batiste, Spencer

  Evans, Nigel (Ribble Valley)

  Bellingham, Henry

  Evans, Roger (Monmouth)

  Bendall, Vivian

  Evennett, David

  Beresford, Sir Paul

  Faber, David

  Biffen, Rt Hon John

  Fabricant, Michael

  Bonsor, Sir Nicholas

  Field, Barry (Isle of Wight)

  Booth, Hartley

  Fishburn, Dudley

  Boswell, Tim

  Forman, Nigel

  Bottomley, Peter (Eltham)

  Forsyth, Rt Hon Michael (Stirling)

  Bottomley, Rt Hon Virginia

  Forth, Eric

  Bowden, Sir Andrew

  Fowler, Rt Hon Sir Norman

  Bowis, John

  Fox, Dr Liam (Woodspring)

  Boyson, Rt Hon Sir Rhodes

  Fox, Sir Marcus (Shipley)

  Brandreth, Gyles

  Freeman, Rt Hon Roger

  Brazier, Julian

  French, Douglas

  Bright, Sir Graham

  Fry, Sir Peter

  Brooke, Rt Hon Peter

  Gale, Roger

  Brown, M (Brigg & Cl'thorpes)

  Gardiner, Sir George

  Browning, Mrs Angela

  Garel-Jones, Rt Hon Tristan

  Bruce, Ian (Dorset)

  Garnier, Edward

  Budgen, Nicholas

  Gill, Christopher

  Burns, Simon

  Gillan, Cheryl

  Burt, Alistair

  Goodlad, Rt Hon Alastair

  Butler, Peter

  Goodson-Wickes, Dr Charles

  Butterfill, John

  Gorman, Mrs Teresa

  Carlisle, John (Luton North)

  Gorst, Sir John

  Carrington, Matthew

  Grant, Sir A (SW Cambs)

  Carttiss, Michael

  Greenway, Harry (Ealing N)

  Cash, William

  Greenway, John (Ryedale)

  Channon, Rt Hon Paul

  Griffiths, Peter (Portsmouth, N)

  Churchill, Mr

  Gummer, Rt Hon John Selwyn

  Clappison, James

  Hague, William

  Clark, Dr Michael (Rochford)

  Hamilton, Rt Hon Sir Archibald

  Clifton-Brown, Geoffrey

  Hamilton, Neil (Tatton)

  Coe, Sebastian

  Hampson, Dr Keith

  Colvin, Michael

  Hanley, Rt Hon Jeremy

  Congdon, David

  Hannam, Sir John

  Conway, Derek

  Hargreaves, Andrew

  Coombs, Anthony (Wyre For'st)

  Harris, David

  Coombs, Simon (Swindon)

  Haselhurst, Sir Alan

  Cope, Rt Hon Sir John

  Hawkins, Nick

  Cormack, Sir Patrick

  Hawksley, Warren

  Couchman, James

  Hayes, Jerry

  Cran, James

  Heald, Oliver

  Currie, Mrs Edwina (S D'by'ire)

  Heath, Rt Hon Sir Edward

  Curry, David (Skipton & Ripon)

  Heathcoat-Amory, David

  Davies, Quentin (Stamford)

  Hendry, Charles

  Davis, David (Boothferry)

  Heseltine, Rt Hon Michael

  79

  Hicks, Robert

  Malone, Gerald

  Higgins, Rt Hon Sir Terence

  Mans, Keith

  Hogg, Rt Hon Douglas (G'tham)

  Marland, Paul

  Horam, John

  Marlow, Tony

  Hordern, Rt Hon Sir Peter

  Marshall, John (Hendon S)

  Howard, Rt Hon Michael

  Marshall, Sir Michael (Arundel)

  Howarth, Alan (Strat'rd-on-A)

  Martin, David (Portsmouth S)

  Howell, Rt Hon David (G'dford)

  Mates, Michael

  Howell, Sir Ralph (N Norfolk)

  Mellor, Rt Hon David

  Hughes, Robert G. (Harrow West)

  Merchant, Piers

  Hunt, Rt Hon David (Wirral W)

  Mills, Iain

  Hunter, Andrew

  Mitchell, Andrew (Gedling)

  Jack, Michael

  Mitchell, Sir David (NW Hants)

  Jackson, Robert (Wantage)

  Moate, Sir Roger

  Jenkin, Bernard

  Monro, Sir Hector

  Jessel, Toby

  Montgomery, Sir Fergus

  Johnson Smith, Sir Geoffrey

  Needham, Rt Hon Richard

  Jones, Gwilym (Cardiff N)

  Nelson, Anthony

  Jones, Robert B (W Hertfdshr)

  Neubert, Sir Michael

  Jopling, Rt Hon Michael

  Newton, Rt Hon Tony

  Kellett-Bowman, Dame Elaine

  Nicholls, Patrick

  Key, Robert

  Nicholson, David (Taunton)

  King, Rt Hon Tom

  Nicholson, Emma (Devon West)

  Kirkhope, Timothy

  Norris, Steve

  Knapman, Roger

  Oppenheim, Phillip

  Knight, Mrs Angela (Erewash)

  Ottaway, Richard

  Knight, Greg (Derby N)

  Page, Richard

  Knight, Dame Jill (Bir'm E'st'n)

  Patten, Rt Hon John

  Kynoch, George (Kincardine)

  Pawsey, James

  Lait, Mrs Jacqui

  Peacock, Mrs Elizabeth

  Lamont, Rt Hon Norman

  Pickles, Eric

  Lang, Rt Hon Ian

  Porter, Barry (Wirral S)

  Lawrence, Sir Ivan

  Porter, David (Waveney)

  Legg, Barry

  Portillo, Rt Hon Michael

  Leigh, Edward

  Powell, William (Corby)

  Lennox-Boyd, Sir Mark

  Renton, Rt Hon Tim

  Lester, Jim (Broxtowe)

  Richards, Rod

  Lidington, David

  Riddick, Graham

  Lightbown, David

  Robathan, Andrew

  Lilley, Rt Hon Peter

  Roberts, Rt Hon Sir Wyn

  Lloyd, Rt Hon Sir Peter (Fareham)

  Robertson, Raymond (Ab'd'n S)

  Lord, Michael

  Robinson, Mark (Somerton)

  Luff, Peter

  Roe, Mrs Marion (Broxboume)

  MacGregor, Rt Hon John

  Rowe, Andrew (Mid Kent)

  MacKay, Andrew

  Rumbold, Rt Hon Dame Angela

  Maclean, Rt Hon David

  Ryder, Rt Hon Richard

  McLoughlin, Patrick

  Sackville, Tom

  McNair-Wilson, Sir Patrick

  Sainsbury, Rt Hon Sir Timothy

  Madel, Sir David

  Scott, Rt Hon Sir Nicholas

  Maitland, Lady Olga

  Shaw, David (Dover)

  Major, Rt Hon John

  Shaw, Sir Giles (Pudsey)

  80

  Shephard, Rt Hon Gillian

  Townsend, Cyril D (Bexl'yh'th)

  Shepherd, Colin (Hereford)

  Tracey, Richard

  Shepherd, Richard (Aldridge)

  Tredinnick, David

  Shersby, Sir Michael

  Trend, Michael

  Sims, Roger

  Trotter, Neville

  Smith, Tim (Beaconsfield)

  Twinn, Dr Ian

  Soames, Nicholas

  Vaughan, Sir Gerard

  Spencer, Sir Derek

  Viggers, Peter

  Spicer, Sir James (W Dorset)

  Walden, George

  Spicer, Michael (S Worcs)

  Walker, Bill (N Tayside)

  Spink, Dr Robert

  Waller, Gary

  Spring, Richard

  Ward, John

  Squire, Robin (Hornchurch)

  Wardle, Charles (Bexhill)

  Stanley, Rt Hon Sir John

  Waterson, Nigel

  Stephen, Michael

  Wells, Bowen

  Stern, Michael

  Wheeler, Rt Hon Sir John

  Stewart, Allan

  Whitney, Ray

  Streeter, Gary

  Whittingdale, John

  Sumberg, David

  Widdecombe, Ann

  Sweeney, Walter

  Wiggin, Sir Jerry

  Sykes, John

  Wilkinson, John

  Tapsell, Sir Peter

  Willetts, David

  Taylor, Ian (Esher)

  Wilshire, David

  Taylor, John M (Solihull)

  Winterton, Mrs Ann (Congleton)

  Taylor, Sir Teddy (Southend, E)

  Winterton, Nicholas (Macclesfield)

  Temple-Morris, Peter

  Wolfson, Mark

  Thomason, Roy

  Yeo, Tim

  Thompson, Sir Donald (C'er V)

  Young, Rt Hon Sir George

  Thompson, Patrick (Norwich N)

  Tellers for the Noes:

  Thornton, Sir Malcolm

  Mr. Sydney Chapman and

  Thurnham, Peter

  Mr. Timothy Wood

  Question accordingly negatived.
  Question, That the proposed words be there added, put forthwith pursuant to Standing Order No. 30 (Questions on amendments), and agreed to.
  MR. DEPUTY SPEAKER forthwith declared the main Question, as amended, to be agreed to.
  Resolved,
  That this House recognises the independence of the all-party Select Committee for Trade and Industry; welcomes the Government's assurance that if that Committee decides to examine the issues raised by the allegation that Singapore was used as a conduit for arms to Iran then it will co-operate fully; and recognises that as far as intelligence is concerned the Government will establish procedures with the Select Committee in the light of the Intelligence Services Act 1994.

Overseas Aid
Mr. Deputy Speaker (Mr. Michael Morris): I have to announce that Madam Speaker has selected the amendment in the name of the Prime Minister.
7.14 pm
Miss Joan Lestor: I beg to move,
That this House, concerned by reports that one billion people throughout the world live in abject poverty, condemns Her Majesty's Government's failure to place genuine poverty alleviation at the heart of overseas development policy, an aim which has been repeatedly sacrificed to the pursuit of political dogma, confusion over Britain's relationship with its partners in the European Union and unlawful linkages between aid and trade; condemns the Government for a decline in real terms in development spending; urges the Government to improve the quality of British aid by reallocation of resources so that more is spent on meeting basic needs such as primary education and health care and less on tied aid; calls on the Government to explain how it will achieve the UN aid target of 0.7 per cent. of GNP; and calls on the Government to take a lead in multilateral programmes which address the needs of the poorest in the world, particularly women and children.
Nineteen ninety-five is a year of anniversaries. It is 50 years since the foundation of the United Nations and 50 years since the creation of the Bretton Woods institutions—the World bank and the International Monetary Fund. For millions of people who had just lived through the horrors of the second world war, those institutions held out a vision of a fairer and more secure world. Absolutely central to that vision was the goal of a world free from Poverty.
Unlike most Tory political leaders today, the world's statesmen in 1945 had an acute understanding of the relationship between poverty and conflict. As the United States Secretary of State Cordell Hull put it in 1945:
"The battle for peace has to be fought on two fronts. The first is the security front, where victory spells freedom from fear. The second is the economic and social front, where victory spells freedom from want."
Fifty years on, the greatest threat to the world is still poverty, which not only brings with it death and disease, but fuels conflicts and condemns entire nations to dependency.
The gap between the have and have-not nations continues to grow. In 1960, the richest fifth living in the industrialised world enjoyed incomes 30 times higher than those of the poorest fifth living in the developing world. Today, it receives 60 times more.
According to Oxfam, the poorest 50 countries in the world account for less than 2 per cent. of global income, yet are home to one fifth of the world's population. That is a clear recipe for instability, conflict and human suffering on a tremendous scale, as we have seen.
There have been extraordinary advances in technology in the past 50 years. People are living longer, infant mortality is falling and more people have access to education, yet one fifth of the world lives in absolute poverty, unable to meet basic needs.
In Africa, one in six children die before the age of five, 130 million children get no primary education and 35,000 children die every day from preventable diseases. That is despite the success of immunisation programmes, oral rehydration therapy and other advances. There is now another threat to which I will refer later—that of Aids. Some 1.3 billion people have no clean water or sanitation.
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Throughout the world, millions of people live in indescribable deprivation and misery. The Opposition believe that such poverty is a moral outrage. Self-evidently, the Government do not regard the eradication of poverty as a priority, and I shall demonstrate why.
I turn first to the Conservative record on aid. If we look at the level of aid as a proportion of GNP, for example, the Government have massively cut Britain's aid budget from 0.52 per cent. in 1979 and rising, under the Labour party, to 0.3 per cent. and falling today. Britain's aid budget as a proportion of GNP is now one of the lowest in the European Union and is set to fall even further if forecasts are accurate. On the Government's current plans, between 1994–95 and 1997–98 the British aid budget will be cut by £;116 million, or 5.2 per cent. in real terms. Moreover, between 1994–95 and 1996–97, bilateral aid to Africa will fall by 17 per cent, while aid to Africa and the Pacific will fall by 12.5 per cent.
The Government have also proposed huge cuts in the British contribution to the European development fund. How does the Minister justify the 29 per cent. cut in the British contribution? Does he not realise the anger that greeted that decision among both our European Community partners and the ACP countries? Does he recognise the important role played by the Lomè convention in the economic development of the 70 African, Caribbean and Pacific countries, 40 of which are defined as least developed and a majority of which are in sub-Saharan Africa?
What is more, British aid has become significantly less poverty-focused, with a large and growing proportion of the budget spent on technical assistance, external consultants, the aid and trade provision and capital-intensive projects. The 1994 Development Assistance Committee review of British aid revealed that, in 1991, only 6 per cent. of British aid to sub-Saharan Africa, accounting for 50 per cent. of bilateral aid that year, was spent on education and other social services such as family planning and health. How does the Minister square those figures, drawn from the "Reality of Aid" report of 1995—I am sure all hon. Members have received copies of it—with Baroness Chalker's claim that the overriding goal of the British aid programme is poverty reduction?
Mr. Gyles Brandreth: Will the hon. Lady give way?
Miss Lestor: I wanted to get on, because this is a short debate that is held only once a year—but such is the hon. Gentleman's charm that I will.
Mr. Brandreth: I am grateful to the hon. Lady—this is indeed a short and important debate. I am sorry, however, that she is adopting such a negative approach. Once again, she is talking entirely about inputs, not outputs. Clearly it is important to have aid that is well focused and well delivered. The amount, too, is important. Will she confirm her party's commitment to the 0.7 per cent. target within five years, and explain how such a commitment will be more effective this time round than last time, when her party ended up reducing the amount spent on overseas aid by £50 million?
Miss Lestor: I am rather glad that I gave way to the hon. Gentleman, in the event. When we left office, the amount

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spent on overseas aid was 0.52 per cent. of GNP, and rising. This Government have been in power for 16 years, throughout which time it has been shamelessly falling.
I do not intend to give any commitments—for the following reason. If the overseas aid budget carries on falling at the present rate for the next year or two, we do not know what level it will be at by then. But if we had been in power for 16 years and had not reached the UN target, if I were dead I would come back and haunt the lot of them.
Miss Emma Nicholson rose—
Miss Lestor: I have already said that we get this debate just once a year, and it would not be fair to others if I gave way again.
Lady Olga Maitland rose—
Miss Lestor: I shall not give way to the hon. Lady.
We also know that the Government are spending an increased proportion of the aid budget on aid and trade provision projects. In effect, that means that large amounts of aid are concentrated on countries that are already several runs up the development ladder, such as Malaysia. These are countries that provide a market for the technical know-how and more sophisticated technological goods that we export.
Lady Olga Maitland rose—
Miss Lestor: I will not give way to the hon. Lady, who is not as appealing as the hon. Member for City of Chester (Mr. Brandreth)—[HON. MEMBERS: "Sexist."] The hon. Lady can make her own speech later, when I am sure she will be called. She must not interrupt mine.
What I have outlined is made clear in the 1993 review of the aid and trade provision, as a result of which the Government introduced a sensible reduction in the per capita income eligibility threshold, to $700—considerably below the OECD figure of $2,500.
When the ATP was introduced by the Labour Government in 1978, it was designed to allow a small proportion of the bilateral programme—about 5 per cent.—to be available to give a higher priority to the commercial importance of a limited number of developmentally sound projects. Since then, a far greater emphasis has been placed by successive Conservative Governments on commercial interests, and the ATP reached its peak in 1991–92, at 10 per cent. of the total bilateral budget. That caused some disquiet, not least to the Foreign Affairs Select Committee, whose 1987 report stated:
"We have no doubt that the influence of commercial interests on the aid programme can and has led to a conflict of priorities."
Then came the scandalous, unlawful decision to fund the Pergau dam project in 1991, which the Government now try to shrug off as a brief period of unfortunate entanglement between aid and arms sales. Following the High Court judgment last winter, the Foreign Secretary was forced to carry out an ODA review to determine whether any other projects had fallen outside the legitimate provisions of the Overseas Development and Co-operation Act 1980. He came up with three more: a project to built a metro system in Ankara, costing £22
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million, which, like Pergau, had Lady Thatcher's personal recommendation behind it; secondly, a £9.3 million project to build a television studio in Indonesia; and, finally, £2.9 million to put in a flight information system in Botswana.
Many of us anticipated a justified replenishment of the aid budget as a result of the repayment of the misappropriated funds, but a seemingly unrepentant and unabashed Foreign Secretary claimed that the books for the previous years in question were effectively closed. Parliament voted the ATP money on the assumption that it would be used for genuine development projects, and we believed that the money spent on Pergau and the other three projects should be returned to the aid budget; otherwise it would be seen as a blatant disregard of parliamentary authority. Only by restoring the money can the Government restore credibility to their aid programme.
Mr. Matthew Taylor: I share the hon. Lady's criticisms of the aid and trade provision, which was introduced by the Labour party. Does she want to abolish it or reform it?
Miss Lestor: We are looking at how the ATP has been used in practice in recent years. I make no commitment, but we are looking closely at reforming the ATP to fit it in with what was originally intended.
Under the new criteria introduced in the 1993 review, we learn that the ATP is to be focused in future on China and Indonesia. Yet the Foreign Affairs Select Committee, in its July 1994 report on Pergau and the ATP, said that it hoped that the benefit of the ATP would not be confined to China and Indonesia, which it described as countries with "poor human rights records"—an understatement, to say the least.
As for debt, the Conservative Government are keen to appear leading players on the world stage. In that case, one would reasonably assume that they would be willing to play a strong role in the international organisations that are such a central part of the lives of developing countries. The debt owed by poor countries to rich ones brings with it the power of the rich to dictate economic, political and social conditions in the developing world.
The terms of the International Monetary Fund and World bank structural adjustment programmes have often resulted in deep cuts in social spending, which mean collapsing health services and closed schools. It is the non-governmental organisations and other aid agencies that are expected to pick up the pieces, but the scale of the problem is so vast that they can skim only the surface of the need. The stock of debt owed by developing countries to the IMF and World bank has grown faster than any other type of debt, tripling from $98 billion in 1982 to $304 billion in 1992.
This year, the 50th anniversary of Bretton Woods, provides a focus for reassessment of the large institutions' role. Typically involved is economic regulation. They have gone in for privatisation of state assets, reductions in public expenditure, liberalised trade, easier access and enhanced terms for foreign investors. We have never denied the need for adjustment, but we are critical of the form that adjustment programmes take. Too often they have resulted in reduced access to health, education and other essential public services. These are basic needs that should be central to any development programme. Coupled with rising unemployment, falling levels of real

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income and damage to the environment, it is often difficult to identify the benefits of such programmes to ordinary people. Inevitably the poorest, especially women and children, suffer disproportionately.
That is acutely obvious in Africa, where more than a decade of structural adjustment programmes has contributed to a fall in real incomes of 20 per cent. There has been a fourfold increase in unemployment, a reduction in investment to the level of 1970 and a further contraction of the region's share of the world market to 2 per cent. Africa is not the only region of the world in which human welfare standards are worsening and where overall levels of poverty are increasing.
In recent years, the World bank has admitted some past mistakes. I welcome the fact that it is now normal practice to include in the pre-planning stage ways to minimise damage to the poor. I welcome also the statement in the bank's 1990 development report that no task should command a higher priority for the world's policy makers than that of reducing global poverty. We live in hope. For the Labour party, that is the yardstick by which the performance of the World bank will be judged in future.
The World bank needs to concentrate much more on improving the direct poverty impact of its projects. It must reverse the alarming decline in lending to agriculture, especially small-scale farming. It must not insist on the imposition of user charges on primary health and education. Indeed, it should seek to safeguard and prioritise public expenditure in those areas. As I have travelled, I have been saddened to see in countries in Africa, especially Tanzania and Zambia, that people must pay for primary education. Apart from anything else, that means that girls in particular are denied access to education. Sadly, a less high priority is placed on their future and their education than that which is attached to boys. That is a direct result of structural adjustment programmes which demand that parents must pay for their children's schooling.
We ask for greater accountability, both of the World bank and of the IMF, to loan recipient countries and of the United Kingdom executive director to the British Parliament. What measures is the Minister considering to improve the accountability and transparency of the World bank and the IMF? Will he consider reports to Parliament? Should there not be regular reports to Parliament and debates on them?
I have been watching with interest developments at the Paris Club since the new debt reduction terms—the so-called Naples terms—were agreed in December 1994. In the Chamber, the Prime Minister said:
"At Naples, we agreed on two specific measures to help those countries facing special difficulties: first, more help with debt payments, taking the level of relief above 50 per cent.—to two-thirds and perhaps beyond; and, secondly, reductions in the stock of debt."—[Official Report, 11 July 1994; Vol. 246, c. 668.]
On 16 December, the chairman of the Paris Club is reported to have said:
"A small number of countries may be awarded once-and-for-all deals in the next few months",
although he omitted to name them. Sources close to the club suggested, however, that Uganda, Bolivia and Nicaragua might be among the first countries to receive such awards.
Against that background, I have been extremely disappointed in the outcome of some negotiations, especially those that involve some of the world's most
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indebted and poorest countries. Nicaragua's Paris Club debt is $1.6 billion, but that is only 14.3 per cent. of its total debt. Many of us had hopes for 80 per cent. relief on Nicaragua's Paris Club debt. After all, it is the most indebted country in the world. In the event, Nicaragua was offered debt relief of only 36 per cent. That was not a breakthrough, and it was certainly not an exit from debt programmes.
Even more disappointing is the case of Uganda. It was offered a 67 per cent. stock of debt reduction, only part of its debt of $350 million. That is only 20 per cent. of its total Paris Club debt. That cannot be described as a two-thirds reduction of Uganda's stock of debt. Nor is it an exit strategy from a debt programme, as recognised as needed by the World bank. As a result, the continuing burden of debt is preventing the Government of Uganda from spending the country's resources on their own people. In 1995, Uganda will spend five times more on servicing its debt than on its own health services.
What happens now that Uganda, in Paris Club terms, has exited from debt reduction negotiations? Who is left to pick up the pieces? Where does Uganda go now with an enormous overhang of debt that is, in effect, unpayable without destroying the future for millions of people?
We have heard that Zambia is due soon to come to the Paris Club. Zambia's debt is chronic. It places a severe burden on Zambia's economy and its people. Servicing Zambia's $6.79 billion debt swallows up 33 per cent. of the country's export earnings. The volume of total debt stock is 2.3 times higher than Zambia's gross national product. Per capita income within Zambia has been in decline but the debt overhang has been rising steadily.
Zambia is a major recipient of British bilateral aid. That aid is not used, however, for furthering development to enhance the quality of people's lives. On the contrary, in 1993–94 about two thirds of total programme aid was used indirectly to support IMF and World bank structural adjustment programmes.
We must put a stop to the merry-go-round of money. Bilateral aid is often used to pay off multilateral as well as bilateral debts. That is no progress. Will the Minister reassure us that the Government role at the forthcoming Paris Club meeting on Zambia will be positive? The debts that are owed by the poorest countries to the Paris Club are causing great concern. Of even greater concern is the growing debt of poor countries to the World bank and the IMF. We all know that, within the World bank, there is growing awareness of the unsustainable level of debt among the poorest countries. There were discussions about such debt at the spring meeting at Washington.
There are two specific points to which I hope the Minister will respond. First, as I understand it, debt outstanding to the World bank from the poorest countries—severely indebted low-income countries—amounts to about $3.9 billion. Although this debt is crippling for the countries concerned, it is not a large sum for the bank. I understand that it has about $3.3 billion set aside for loan-loss provisions. It has $14.5 billion in reserves.
Have the Government given consideration to supporting proposals for the cancellation of debt of severely indebted low-income countries to the bank, and for the moneys to be written off under loan provisions? It would be interesting to know the views of the Minister

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and of the Government on these matters. Has the Minister discussed them with his colleagues in the Treasury and in the Departments with responsibilities for trade?
Secondly, we know that there have been discussions about the conversion of International Development Association loans into grants for the poorest countries. The proposal has been supported by the Government. Has there been further discussion? Will the matter be discussed at a meeting of IDA deputies in South Africa at the end of the month? Is the proposal supported by other countries? My right hon. and hon. Friends have shown a great interest in the possible conversion and may wish to enlarge upon it. We would all welcome replies to my questions. Continuing flows of aid will have little impact on poor countries if the aid is swallowed up by debt repayment.
Something that was not foreseen 50 years ago and which has brought misery and destitution to many parts of the third world, particularly Africa, is, of course, acquired immune deficiency syndrome and human immune deficiency virus. I do not believe that it is given anything like sufficient attention worldwide, and it is having an impact on the developing world. We cannot have aid and development policies that do not take it into account. I attended a seminar in Barcelona in May, in which we evaluated the progress to date. AIDS has to be taken seriously in any programme for aid and development.
In one antenatal clinic that I visited in Africa recently, some 25 per cent. or more of the women attending were HIV-positive. As I am sure the House is aware, AIDS is now spreading among women far more rapidly than any other section of the population. One in three of the babies of those women will be born with the virus. All of them will develop AIDS and most will die before they reach the age of five. So far, 1 million children worldwide have been infected and half a million have died, most of them in Africa. Two thirds of all new cases of HIV are occurring in Africa, where, it is estimated, 9 million children will be orphaned in the next five years, and where recent gains in child survival are being reversed.
In Zimbabwe, which I visited recently, AIDS has become the single biggest killer of the country's under-fives. In Thailand, one adult in 50 is infected, and it is feared that the country's under-five mortality rate will rise rapidly within the next five years.
Of the $2 billion spent annually on AIDS prevention, only about 10 per cent. is spent in the developing world, where 85 per cent. of infections are taking place. That is a sobering thought for all of us to take on board. The targets set by the 1990 World Summit for Children agreed on a series of goals for improving the lives of children, and lowering infant mortality. Some of those goals are well on the way to being achieved: malnutrition has been reduced; measles deaths are down, due to immunisation programmes; and polio is well down—some areas are free from it altogether. Iodine deficiency illnesses and vitamin A deficiency are being overcome and the use of oral rehydration therapy is rising, preventing more than 1 million children's deaths a year. There has been other progress.
Is AIDS now to replace those diseases? Is it to become the biggest killer of the under-fives? We have to give it attention. As I said, 50 years ago that illness could not
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have been foreseen and the HIV virus was unknown. We cannot go on with aid and development policies without taking that on board.
Fifty years ago, the founders of the United Nations and the Bretton Woods institutions committed themselves to the eradication of global poverty and to the construction of a fairer and more secure world. While much has been achieved in the past half century, the goal of eliminating world poverty is still far from being realised. Although the Government claim to be committed to tackling poverty, their record, as I have shown, tells a very different story. Over the past 16 years, they have cut aid as a proportion of GNP, reduced the poverty focus of UK aid and failed to lobby for the world's poor within international forums.
The Government's policy for international development has been a failure. Labour—and only Labour, with its record in this field—can be trusted to make a priority of the struggle against global poverty and injustice. I commend the motion to the House.
7.43 pm
The Minister of State, Foreign and Commonwealth Office (Mr. Alastair Goodlad): I beg to move, to leave out from "House" to the end of the Question and to add instead thereof:
"concerned by reports that one billion people throughout the world live in abject poverty, commends Her Majesty's Government's support for sustainable development and poverty alleviation through its support for economic reform, good government, and investment in people and productive capacity, as well as through direct action to provide the poor with opportunities to improve their lives; and urges the Government to pursue these policies with their development partners and multilateral agencies.".
I very much welcome this opportunity for the House to look again at the subject of overseas aid. It is, as always, a timely issue.
The hon. Member for Eccles (Miss Lestor) threatened to return, under certain circumstances, to haunt us. I hope that that will not be necessary, or, indeed, possible, as I hope that she will remain on this earth with us. But if I am ever to be haunted, I would like to be haunted by the hon. Lady.
The Halifax summit devoted particular attention to the subject of development and to the scope for improving the international system for promoting it. At the Organisation for Economic Co-operation and Development, Ministers have recently endorsed a statement of the role of development co-operation at the mid-point of this decade. Here at home, the Overseas Development Administration, like the diplomatic wing of the Foreign and Commonwealth Office, is undertaking a fundamental expenditure review, and all those matters are of great concern to the House.
The world is going through a rapid process of change. My responsibilities take me frequently to Asia. Much has been said and written about the "Asian miracle"—the way in which so many countries have succeeded in growing year after year at rates that are among the highest ever recorded in history; their growing role in the world economy; their ability to continue growth, even during an OECD recession; and, of direct relevance to the Opposition motion, the sharp decline in the number of those in poverty.
The reasons for that astonishing progress have to do with consistently sound macro-economic policies and a long-term commitment to private sector development,

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pro-export policies and high attainment in education. The "miracle" has now spread westward—although, perhaps, not as far as the constituency of the hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes)—encompassing most of south-east Asia. Parts of Latin America are experiencing unprecedented growth.
Aid has played an important role in the Asian transition, and continues to do so for the poorer countries. The hallmark of that aid, however, has been helping people and Governments to help themselves. There is no dependency culture in eastern Asia. Countries wish to access western know-how and concessional finance to accelerate their social and infrastructure investments. As they become better off, their need for aid declines. Some have graduated out of aid entirely. Private finance in all of them is playing an increasing role. Singapore and Korea, for example, are already significant investors and donors in other countries. Other new donors are about to emerge.
There is, on the other hand, no doubt that poverty remains a deep-rooted and vital problem. The figure of roughly 1 billion people in abject poverty has remained stubbornly high even while their proportion in the rising population of developing countries has fallen. The largest part of the problem is in south Asia and sub-Saharan Africa. The Government and other donors are working to help the countries concerned to address the problem.
The ingredients of success in east and south-east Asia—rapid growth based on sound policies, export orientation, high savings and investment, avoidance of a dependency culture—are as relevant to south Asia and to Africa. They also fit well with the evolving nature of international aid programmes. Last month, the OECD drew up and agreed a statement of common purpose about the role of aid in the mid-1990s. It recognised the successes achieved over past decades, noted that aid was only one of the sources of those successes, urged that aid should help the poorest to expand their opportunities and improve their lives and committed donors to managing bilateral and multilateral aid with maximum efficiency. Britain fully supports the themes in that statement.
The statement was issued against the background of concern about the future levels of aid. In 1993, the absolute amount of western aid fell significantly for the first time in recent years. We expect the official figures for 1994 to be released by the OECD in the next few days. They are likely to show that western aid will, as in 1993, represent around 0.3 per cent. of OECD gross national product, or a little lower. There is talk of a global aid funding crisis.
The Government believe that such talk is overdone. There are still high net transfers from donor countries to low-income countries. A number of donors, including Japan, which is now the largest of all, are continuing to expand their programmes. There is still, in the Government's judgment, scope for several donors to focus their aid more intensively on the poorer countries, as we do. Nevertheless, there is no doubt that Government budgets are tight everywhere. Canada, Germany and Italy are three of the largest examples of important donors whose aid programmes have declined, or seem likely to over the next couple of years. However, the most significant question, yet to be determined, is how the American authorities—the Administration and Congress—will judge the future size and scope of foreign assistance.
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The United States is already the back-marker among OECD countries in terms of the proportion of its economy devoted to overseas aid. We are very anxious that the United States should remain fully engaged as a bilateral donor in Africa, and should play its traditional strong role in the planned replenishment of the soft loan arm of the World bank. My right hon. and noble Friend the Minister for Overseas Development will visit Washington next week, and I know that those matters will be high on her agenda.
We have had the usual representations from the Opposition about the size of the British aid effort. The fact is that, as the 1994 figures will confirm, we are at fifth place in the overall league of donors, up from sixth place—the position that we occupied when Labour was last in power. Furthermore, our assistance in 1994 was above the average for all OECD countries. The last public expenditure round led to an enhancement of £115 million for the aid budget for the final year of the public expenditure survey. That demonstrates the Government's commitment to maintaining a substantial aid programme, despite the cuts being made by many other donors and despite the absolute need to keep public expenditure under control.
Concern has been expressed that our aid is being diverted from the poor by the needs of eastern Europe and the former Soviet Union, the rise in emergency aid and the pressures from increased European Community aid spending. Let me deal with each point in turn.
The Government make no apology for our assistance to eastern Europe and the former Soviet Union. It is an overwhelming British, and global, interest that their transition to market economies and pluralist democracies should be accomplished swiftly and effectively. Hundreds of British private sector organisations—including many non-governmental organisations—have responded to the new challenge. The Government, for their part, expanded the aid programme to launch the know-how fund. It will account for some £80 million this financial year, and has an outstandingly successful reputation. Several countries are now well on with the transition, and as it progresses we expect the need for assistance to decline.
As for emergency aid, it has indeed increased substantially, from under £100 million in 1989–90 to over £260 million in 1993–94. The Government have thought it right to contribute generously to emergency needs, whether in Bosnia or Rwanda. British agencies have an outstanding record in effective delivery of such assistance. We are putting increased effort into conflict prevention and crisis management. Despite understandably gloomy predictions, I see no reason why emergency aid should need to expand further. Each situation will be judged on its merits, and Britain will continue to play a prominent role.
The rise in European Community spending on aid has been widely remarked, not least in successive reports from the Foreign Affairs Committee. The Government attach great importance to the effective management of European Community assistance within the ceilings set at the Edinburgh summit. We are hopeful that an early decision will be made on the priority areas for aid from the Community budget. In addition, as the House will know, important negotiations are now taking place on the United Kingdom's contribution to, and the overall size of, the next European development fund.
Mr. Mike Watson: The Minister mentioned the Edinburgh summit. As is well known, his

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Government—admittedly, along with the German Government—have been primarily responsible for the stalling of negotiations on the eighth EDF. Will he explain how the Government align that with the Foreign Secretary's comment, in a speech at the Overseas Development Institute in March, that the EDF was perhaps the best and most effective element of European Union aid? Is it not true that those two facts cannot be reconciled, and that the Government must take their responsibilities much more seriously?
Mr. Goodlad: We take our responsibilities extremely seriously. As the exact amount of the European offer is subject to on-going negotiations with our European partners, I think that it would be wrong for me to comment further at this stage.
Mr. Watson: Will the Minister give way again?
Mr. Goodlad: No, I do not think I will.
Mrs. Gwyneth Dunwoody: I have a slightly different problem. The Foreign Secretary also said in that speech that the amount that we were committing to European funds would cut the amount available for bilateral aid. We have a long and honourable tradition of efficient bilateral aid. Can the Minister sort out my problem? Is it true that the Foreign Secretary thinks that we spend too much through the European funds and would like more to be spent bilaterally, or does he feel that we should now be committing more to the European institutions?
Mr. Goodlad: The hon. Lady will agree with me on two points. First, she will agree that there should be an appropriate balance: I take it that she has no innate prejudice against European aid, as opposed to any other aid. Secondly, she will agree that the aid should be properly applied. Perhaps the hon. Lady will disagree with this, but I do not think that a recipient of aid is likely to say, "I do not want any of this multilateral filth from Europe; give me the decent bilateral stuff that I am used to." I see that the hon. Lady agrees with that analysis.
Although the rise in the European Community budget will inevitably mean some further decline in Britain's bilateral aid programme, the Government are determined to maintain bilateral aid at an adequate level and to focus it on poor countries. Very nearly seven tenths of it is at present directed at the poorest categories of country—countries with incomes lower than $675 per head. That is a higher proportion devoted to the poorest countries than by any of the other top five donors.
The Government are also determined to build on their well-deserved reputation for quality. We have a highly professional aid programme that recognises the importance of appropriate policies in recipient countries, the need for aid to support local initiatives rather than substituting for them and the need for local communities, as well as Governments, to participate fully in the process of development.
The Opposition motion urges the Government to spend more on basic needs such as primary education and health care. We are indeed doing just that. At the beginning of 1994, we announced a change in our policy on support to education to emphasise primary and basic education. We started to implement that policy immediately. Expenditure
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on primary education has risen by nearly two thirds since 1992. We have consolidated work on projects at the primary level in India and south, east and west Africa; we have also undertaken major new initiatives over the past 18 months in central Africa. In non-formal education, a project to support nomadic education in Nigeria is being appraised, and we are supporting a number of projects in Bangladesh that provide education for those denied access to the formal sector.
In addition, we have funded research into levels of reading skills in Zambia and Malawi. That research is crucial in assisting us to address some of the problems of quality at primary level. Without good reading ability, the rest of the curriculum can be lost to children. In India, where we have worked with the local authorities to upgrade primary education in Andhra Pradesh—a state with a population roughly the same size as Britain's—we are now well advanced in developing a similar project in the even more populous state of West Bengal.
In Zambia, we are working with the Ministry of Education to strengthen the primary inspectorate and establish training systems for all primary teachers. In Malawi, we are helping the Government to meet the demand for primary schooling by providing funds for the construction of community schools. In South Africa, Gambia and Ghana we are supporting primary teacher education projects, and in Kenya we are helping to strengthen research and planning capacity for the primary sector.
We are also increasing the resources that we devote to assistance in the areas of health and population. We are major contributors to essential health care and better reproductive health in sub-Saharan Africa. We have ground-breaking new projects involving NGOs as well as Government in Kenya, Uganda, Tanzania, Zimbabwe and Malawi. At last year's population conference in Cairo, my right hon. and noble Friend the Minister for Overseas Development committed Britain to investing more than £100 million in new health and population projects by 1996. I am confident that we shall exceed the commitment target and, through the high quality of our aid, bring benefits to millions of disadvantaged people.
There is more. The House will be aware that Britain has unrivalled expertise in the area of international health. Our aid to Cambodia, Russia, and South Africa shows how we can support effective partnerships between British experts and their colleagues overseas. We back the know-how, where possible, with capital and commodity aid, sometimes from the European Community. As a result, we are playing a significant role in improving people's access to primary health care, their survival and well-being in the face of hazards such as malaria and AIDS, and their access to essential services in emergencies. Those are real achievements of which Britain and all those involved should be very proud.
Mr. Brandreth: Did my right hon. Friend have an opportunity last week to see a television programme on the fate of children in an orphanage in China, or has he seen reports of it? As the motion refers to children, does he have any reflections on that programme?
Mr. Goodlad: I have reflected on it. Anybody who saw the film will have been profoundly shocked by the inhumanity that it exposed. We take every opportunity to bring our concerns about human rights violations to the attention of the Chinese authorities. We shall continue to

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do that. The film alleged that the UNFPA—the United Nations population fund—supports population control in China. That is incorrect. The UNFPA and the International Planned Parenthood Federation are at the forefront of global action to promote the right of all women and men to choose without coercion the number of children that they wish to have.
While the Government do not contribute directly to population control in China, we contribute to the core funds of the UNFPA and the IPPF, both of which have small programmes in China aimed at promoting more humane policies. They strongly oppose coercive population control of any kind. If we withdrew our support from the UNFPA and the IPPF, we would remove one of the few channels through which we can seek to influence China's population policies. My hon. Friend the Member for City of Chester (Mr. Brandreth) raises an extremely important point, which we shall continue to raise with the Chinese Government.
The Opposition motion also speaks of unlawful linkages between aid and trade, and calls on the Government to spend less on tied aid. As the House will know, my right hon. Friend the Secretary of State for Foreign and Commonwealth Affairs instituted a rigorous review of all aid programme commitments following the judgement on Pergau last November. We found three other projects financed from the aid and trade programme, where it seemed that political or commercial factors had overridden developmental counter-arguments. Those projects are now being financed outside the aid programme.
To give the House a flavour of how rigorous we were, I should point out that one of those projects, for an air navigation aids system in Botswana, was deemed by the Foreign Secretary to be questionable on the ground that the papers showed that, from an economic point of view, Botswana should have continued to use the services of the then apartheid South Africa. Hon. Members may feel that the decision, in the circumstances of the day, to provide Botswana with a system of its own was not unreasonable.
The hon. Member for Eccles spoke about the aid and trade provision. We announced in 1995 in the departmental report that the ATP would be £53 million in 1997–98. That will be less than the 5 per cent. of bilateral aid that was set as a target when the ATP was introduced by the previous Labour Government.
I repeat that we are aware of no remaining projects that are questionable in terms of the Overseas Development and Co-operation Act 1980. I categorically reject the absurd allegations that the World Development Movement still seeks to make about alleged linkages between aid and arms sales to a small number of foreign countries. Aid has not been used to promote arms sales, and it will not be so used.
Those who complain about tied aid should look carefully at the facts. Half our aid programme goes through multilateral channels and is thus automatically untied. [Interruption.] More will go through multilateral channels, so it is right to say that more will be untied. A large proportion of the rest is tied only in a sense that it brings foreign students to Britain or provides the services of British experts, consultants and institutions to foreign countries—including those who work on basic education and health projects.
The Government have untied 75 per cent. of our contribution to the special programme of assistance for Africa, to which our latest contribution was £300 million.
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We routinely finance local costs for projects, such as many of those in the social sectors, which depend on such funding. Where Britain is not a competitive supplier, we are perfectly willing to purchase from third countries. But the Government believe that it is right and proper that, until such time as the donor community as a whole unties bilateral aid, Britain should similarly give first crack to its own firms and suppliers.
The Government wish to see the international aid agencies to which we contribute address the problem of poverty following the same principles that I have outlined, and to do so with increased efficiency. In that context, the reform agenda set out by the Halifax summit is of major significance. As my right hon. Friend the Prime Minister said in his statement to the House, we have now drawn up a series of specific proposals to strengthen the Bretton Woods institutions and the United Nations. Revitalised international institutions will play a vital role in tackling poverty and creating the conditions for sustained development.
We agreed in particular to encourage better use of all existing World bank and International Monetary Fund resources, to tackle the substantial burden of multilateral debt faced by some of the world's poorest countries. The United Kingdom has taken a lead in that area in pressing for action, and reducing the debt burden will make a major contribution to alleviating poverty.
The number of people in abject poverty is a challenge to us all. Simplistic solutions do not work, and merely throwing money at problems is always ineffective. Time and again we have seen that sustained reductions in poverty come from broad-based growth grounded on the steady application of sound economic policies, better government and investment in people. Success does not come instantly. Aid donors can speed the process by facilitating reforms and strengthening programmes to alleviate poverty. Britain has demonstrated time and again its capacity to provide finance and know-how in ways that contribute to that goal.
For me, the speech of the hon. Member for Eccles was rather like flicking through an old album of yellowing sepia-tinted photographs of a bygone era of Stalinist neo-colonialism: looking at well-meaning figures facing the camera, staring life straight—if unseeingly—in the face. The poorer countries do not want hand-wringing from the Labour party. They want concrete measures to help them to become more self-reliant.
The Government have led the way and transformed the global aid debate. First, we have led the drive for free trade and trade access. We must never forget that trade brings three times as much revenue to the developing world as aid. Secondly, the Prime Minister has consistently led the way on debt relief with the original Trinidad terms and their subsequent extension through the Paris Club. Thirdly, we have introduced the idea of good government, using aid to promote sensible economic policies, democratic institutions, the rule of law and respect for human rights. We have pioneered the use of dedicated technical aid through our know-how funds.
The Labour party is a very long way behind the game. If it has begun to shift away from the old left-wing orthodoxy of never criticising third-world Governments, I welcome that. It still puts all the emphasis on the symbolism of large transfer payments instead of looking

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at how aid resources are used. The objective must be not to make ourselves feel good, but to help the populations of the world's poorest countries.
Today's debate is an opportunity for Opposition Members to posture, as their spokesmen do every day in the media with every conceivable pressure group, irrespective of whether their sums, if they have done them at all, add up. Labour's commitment to reach the United Nations target of 0.7 per cent. of GNP does not add up to a row of beans unless Labour is prepared to put a precise time scale on it and say how it will finance it. Will it be by higher taxes or by cuts in education, health or social security funding? If so, I am sure that Labour Members will have cleared their statements with the shadow Chancellor, and we shall note them very carefully.
Such pledges are an irrelevance unless they form part of a strategy for economic growth that will generate new economic resources. Thanks to Conservative policies, Britain's economic performance is second to none in Europe and is set to remain that way. That is the key to a serious long-term aid commitment.
I invite the House to reject Labour's irresponsible motion and to support our amendment.
8.13 pm
Mrs. Gwyneth Dunwoody: A group of women from all over the Commonwealth came together in the House last week. They were members of the Commonwealth Countries League. Their patron is our most honoured Speaker and their function is to raise money for the education of women throughout the Commonwealth. They do so not in a showy way but in a consistent attempt throughout the year to raise cash. A small group of them do all the administration and take control of the money, which is sent to some Asian countries and, largely, to Africa.
I was able to tell that group of women that, a short time previously, I had been honoured to go to Ghana with a delegation under the leadership of the right hon. Member for Conwy (Sir W. Roberts). He distinguished himself with that wonderful Welsh hwyl that made him dearly loved throughout the country and his ability to recognise instantly and identify with the problems that we met.
When I hear some of the undoubtedly very uncomfortable cliches that Ministers trot out from the Dispatch Box, I am reminded of the reality of life for many women and children in Africa: the lack of decent clean water and the shortage of education and health provision. Indeed, in some Commonwealth countries there has been a reversal of existing health programmes so that people's access to clinics and to the support that they had had through trained village nurses has been reduced rather than increased.
When the Government know that the money committed by the United Kingdom is becoming less every year, I wonder that Ministers can still seriously talk about our reputation, experience and commitment to overseas aid. In reality, we are always seeking ways of expanding our commercial opportunities. While there is nothing wrong in that, it is not what aid is for. It does not improve the income or opportunities of many of the people who are most in need. Moreover, it is clear that the Government's commitment to aid and trade is positively damaging some of the things that the House regards as most important.
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I wish to deal briefly with the Government's commitments to Ghana in respect of supporting the electoral commission as it illustrates the problems that we have. We were told in Ghana that the electoral commission, which is independent of the Government, is seeking to set out in considerable detail the new registers for the coming election. It is working on an extremely tight timetable. If it fails to do the job efficiently, Ghana's belief in democracy will be severely damaged. It is therefore very important that the electoral commission should be given every known support.
The Government were therefore prepared to look at the available machinery and the modern equipment that would enable the electoral commission to produce an accurate electoral register containing the names of all the people who needed to vote. That is tremendously important because, as we were told, large numbers of people did not vote in the last general election because they believed that there were problems with the existing machinery.
The fact that people boycotted those elections produced a Parliament which, although it impressed us with its vigour and its intent efficiently to bring democracy once again to the parliamentary system, clearly left some large sections of the community in Ghana feeling that they were not properly represented. It is therefore vital that we help the electoral commission to get the whole business of preparing its register right. If that fails, the whole system will be blown out of the water, not least because people will not believe that there is a genuine, accurate register. Hon. Members know how important it is that such elementary machinery should be available.
I have no intention of naming names, but a British company did a great deal of development work with the electoral commission and said that it thought that it was capable of producing equipment which would not only make it possible to scan at tremendous speed the relevant information but to produce detailed and positive benefits. Certainly, that would involve a great deal of expense but it would produce a reliable and efficient register. It worked with the director of the electoral commission over a long period on the sort of information and the general level of expertise that was needed, using a system which was reasonably well known in Government circles in Ghana because it had been used by some people in education.
Then, apparently, London determined that everything should be put out to open tender, and the contract went not to the people who had done the development work but to someone else, using a different system which is probably not compatible and certainly has not been used in that context and that manner. I am not prepared to argue the rights and wrongs of whether one unknown system will be any better than another which is equally unknown, but I am alarmed at the political implications of taking the wrong decision.
If the register is not correct, Ghana—the one west African country capable of producing stable parliamentary democracy—will find that democracy is put at risk because the voters will think that the results are not genuine. There can be nothing more damaging than the voters believing, for one reason or another, that the register is not correct.
When one realises that there is no register of deaths in Ghana, the sort of problems that the electoral commission will face become apparent. The commission was not allowed to accept the carefully noted information kept by

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traditional chiefs, because the law would not allow it. The inflexible attitude in London is causing major problems. I do not expect Ministers to comment tonight, but I ask them to think seriously about the matter and to be prepared, even at this late stage, to consider the alternatives.
The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Mr. Tony Baldry): It is not clear whether the hon. Lady is saying that such projects should not be put out to competitive tender. She has been in Ghana recently—I understand that she and others are coming to see me about that tomorrow—so she must appreciate that there is no question of the ODA ever seeking to impose a particular solution on another country with regard to any aid project. Any aid that we give is given co-operatively and with the full support of the country receiving it. The project to which the hon. Lady refers will only and could only go ahead with the full support of the electoral commission in Ghana. Without that support, there would be no point in proceeding.
Mrs. Dunwoody: That would be very reassuring if the Minister did not know that the only way that the equipment is ever going to be paid for is through tied British aid. While I am happy to have his assurance that nothing will be foisted on the electoral commission, I have to ask him to think again, even if not tonight, because if we get it wrong the results could be dangerous.
One of the problems is that the Government are not clear about their own attitude to overseas aid. It is certainly not clear to us whether they have the commitment to the African continent that they should have. I do not know whether this is a correct but only this weekend I read that the Foreign Secretary said:
"The commitments we face to multilateral agencies—notably the programmes of the European Community—are reducing what we have available for aid that is recognisably British."
Was he saying that our European commitments are leading to difficulties? If so, and if he is saying that there is pressure on the ODA to reduce its trained staff, the programmes that it is undertaking or the various support systems that it uses at times of emergency, the House has reason to be seriously worried.
I was approached by a member of the medical profession when there were considerable difficulties in Rwanda. It was pointed out to me that this country had large amounts of sterilisation equipment and straightforward medical aids for barrier nursing which could have been transported by the planeload to those at risk from hepatitis and other diseases, but that we were not transporting it in the amounts or with the speed and urgency necessary to turn the situation around.
Barrier nursing is one way in which we can stop the spread of dangerous diseases among many Africans. That is doubly true of HIV. We know that many AIDS patients are removed from hospital by their families, who have no clear idea of how disease is transmitted and certainly no clear idea of how to protect themselves. That in itself can lead to more infection.
Mr. Baldry: The Government and the British people have given more than £90 million of relief to Rwanda to help with its recent disaster. How much more does the hon. Lady think should have been given? Is there 1p of that £90 million that she thinks has been spent on a project that was not worth while?
Mrs. Dunwoody: The Minister was clearly not listening. I am not responsible for the overseas aid budget.
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The Conservative Government are responsible for the budget, and they are spending less than they were. They have access to medical equipment that could be sent by the planeload. If the Minister wants to know whether I think that, in an emergency, we should send immediate medical support and aid, the answer is that I do. If he wants to know whether I think that we should commit more money than we have in the past, I do. If he wants to know whether that is a generally held view among members of his party as well as mine, I can tell him that it is. If he thinks that he has scored some clever political point, I have to disabuse him of that notion.
Many people outside the House, of every religion and type, understand what we could do if we had the necessary commitment and political will. They also understand that only in the House is overseas aid regarded as one of the least important topics. It is debated only in Opposition time because it is not convenient for the Government to discuss in any detail what we are doing with our existing aid and trade budget.
I do not have the great and unalloyed admiration for the European aid projects expressed by some of my colleagues. I served on the African, Caribbean and Pacific countries committee for four and a half years. I believe that the inability to introduce flexible banana quotas between one country and another is contributing to the poverty of the West Indies right now. The inability of the British Government to push through some protective measures is revealed every time one goes into a supermarket and sees nothing but German and South American bananas on display rather than those from Commonwealth supporters.
I believe that institutions are becoming so rigid that they are not producing the necessary results in terms of their own development programmes. The Government's apparent ambivalence is probably a reflection of the fact that they are now waking up to the reality of what is happening in the Community. However, if we are not going to use those mechanisms, we must expand what we are doing bilaterally and put a great deal more effort into Africa and accept that that is where the major problems lie. We must also be genuinely prepared to tackle at source the matters with which we can deal, and deal with them with the expertise that we have but which we sometimes seem loth to demonstrate.
8.28 pm
Mr. Jim Lester: I always enjoy speaking in such debates. I have great respect for the hon. Member for Eccles (Miss Lestor), because I remember that, in a previous incarnation, she resigned her position over the reduction if the previous Labour Government's aid budget in 1976.
Miss Lestor: I must correct the hon. Gentleman—I hate to do so, because I am being flattered. In fact, I resigned because of the cuts in nursery school education. There would have been no need to resign over the overseas budget, because it increased throughout the life of the previous Labour Government.
Mr. Lester: It was reduced by, I think, 50 per cent. in 1976 according to my figures, but that is in the past.
One gets the impression that the motion is a scattershot motion that nitpicks about everything. The only line with which I agree is that which states:

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"one billion people throughout the world live in abject poverty".
During the years that I have been in the House, I think that I have visited most of the poorest countries in both south-east Asia and Africa. I have seen changes for the better as a result of our aid programme. I am second to none in my belief that the transfer of resources, of which aid is one important element, is essential as a moral imperative and is in Britain's self-interest—for those who consider matters only in terms of self-interest—in terms of the development of our economy as a major trading nation and of the movement of people.
It is often forgotten that television works in two ways. We see situations in the rest of the world that cause our constituents and ourselves great concern, but, equally, people see our world. Having just been to the Caribbean with the Select Committee on Foreign Affairs, one was conscious of the fact that, in every island one went to, people complained about the endless diet of American television, which was the only thing they could get. It shows them a level of affluence and creates pressures that, inevitably, people will want to remove if their position in their country is not likely to improve.
We have always had the argument about the level of aid. My right hon. Friend the Minister mentioned one or two countries that have reduced their aid budget. In the present world situation, according to the latest figures from 1992–93, the British Government have held, and in fact increased, their budget. That is a matter for congratulation, not condemnation.
I say this with no pleasure. Looking through, one finds that aid has been reduced by Austria, Belgium, Canada, Finland, France, Germany, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Spain, Sweden, Switzerland and, most serious of all, the United States of America. Britain is one of the four countries in the group that increased its budget. That should be a matter for congratulation, not condemnation.
We need to ensure that some colleagues and others do not latch on to the idea that reducing the aid budget is a good idea. Having just come back from Washington, which I visited before we went to the Caribbean, I am deeply concerned about the discussions on Capitol hill about what overseas aid should be. There is real concern among American officials that, if the present discussions come through, they will not he able to claim that they have an aid budget of any description.
The hon. Member for Eccles mentioned aid and trade provision, and the Select Committee report in 1987. I happened to be on the Committee at the time and a party to that report. We have always agonised about aid and trade, the way it should be organised and whose budget it should come from. We are about right in terms of the 5 per cent. figure that we have reached.
It is difficult to know, but I suspect that, if they were honest, Opposition Members would admit that, if a constituency company told them that it had won a contract, wherever in the world, but that lack of British Government support, as opposed to support by the French, German or Italian Governments, had lost it the order and therefore it could not succeed, those Members would go to the Minister with that company and argue that we should at least have a same level of support other companies in other parts of world. It is a bit of a
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double-take to argue against aid and trade provision but then not to accept the consequences in terms of international competition.
I have always thought that aid and trade provision should be argued for by the Department of Trade and Industry, but we cannot honour the general agreement on tariffs and trade rules if we do it that way. The Select Committee on Foreign Affairs felt that it was important to maintain this minimal aid and trade provision. A small proportion of our total overseas aid budget, which again was not mentioned by Opposition Members, is basically given on grant terms. I think that, in Britain, a higher proportion of the aid budget is given as a straight grant, which affects neither loan nor any other support, than in any other country.
Brief mention has been made of the Pergau dam. Again, as someone who has studied it carefully on the Select Committee, I believe that it is a grave mistake not to recognise that electricity is an important element in poverty relief. Places such as north Malaysia that have no electricity, and villages that cannot operate after dark or that do not have any basic machinery, should all be taken into account. I do not want to go further down that road, because others want to speak, and I want to talk about other issues.
The hon. Member for Eccles mentioned debt, as did my right hon. Friend the Minister. I genuinely cannot understand why the Opposition cannot produce some enthusiasm for the British Government on the issue of debt. Of all countries in the world, we have given the foremost lead.
When he was Chancellor of the Exchequer, the Prime Minister started with the Trinidad terms. He pushed it again at Naples. Again, his statement on the Halifax summit shows that he is one of the front runners, along with the Chancellor of the Exchequer, who used the Commonwealth Finance Ministers meeting to put forward the terms of selling International Monetary Fund gold, investing it and writing off the debt of sub-Saharan Africa. He spoke out clearly, and, for once, Oxfam was thoroughly delighted because that was its policy; it is not often that it feels that a Chancellor of the Exchequer argues for its policy, but he believes it strongly, and he argued for it.
I understand from a brief conversation about Halifax that we were the front runners in pushing other countries—we must act in partnership—to move forward. It is not the British Government who are resisting the sale of gold and the investment of that money; at least three other partners continue to do so. The British Government and the British Prime Minister are trying the hardest to bring that policy about by one means and another.
We all accept that the debt level of some sub-Saharan African countries is unacceptable. The all-party group on overseas development produced a report on that issue, to which Opposition Members were party on an even basis. We are clear on what needs to be done and how it needs to be done, but one must move along with other countries; we cannot do it single-handed.
We have also led the way in debt reduction and on grant terms. I occasionally wonder whether some faint words of praise from the Opposition for the way in which the Government have given the lead on this issue might be helpful and encouraging in terms of both the Prime

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Minister and Chancellor of the Exchequer continuing their excellent work, which is widely recognised by third-world countries, about which we all share a concern.
Recently, the hon. Member for Eccles and I were signatories of a letter to the World bank over its attitude on poverty relief. In Washington, I saw the figures of the signatories from different Parliaments when that letter was presented. It would not surprise Opposition Members—it might, judging from the number of people listening to the debate—that the United Kingdom Parliament had by far the most people signing that letter.
Miss Lestor: It was all the work we did in getting the signatures.
Mr. Lester: From memory, I believe that we got more than 337 signatures, and that will have an effect.
Mr. William Cash: On the question of the World bank, does my hon. Friend, who is a great expert in these matters and is recognised in the House as such, realise that it may be a good idea to change the charter of the World bank to ensure that the arrangements for debt reduction can be reflected not merely in what we want to do but in the provisions of the charter? I understand that Mr. Cadmessus is somewhat sympathetic to that point of view. Would my hon. Friend want to give him every encouragement, and would he want the Government to give every encouragement to a change in the charter, so that we can achieve something rather than merely say that we want it?
Mr. Lester: As I said earlier in relation to debt reduction, one must recognise that one must work with many partners in these issues. At Halifax, we have reinforced the fact, as the Prime Minister said today, that we need to look hard at the Bretton Woods institutions. People have all sorts of ideas about how they can be improved, but the real point is that the only way in which we can improve them is to carry our other major donors with us.
The hon. Member for Southampton, Itchen (Mr. Denham) and I attended a hearing on Capitol hill on behalf of the all-party group on overseas development, in which we had before us the deputy both of the IMF and the World hank. That was an international effort to show those eminent and important people the depth of concern that many of us have about the level of poverty and the way in which World bank loans can be used.
Over recent years, we have seen a total change in the World bank's attitude. One change is for the bank to recruit some of its most persistent critics from the World Development Movement, from Oxfam and from some of the non-governmental organisations in this country to advise how it can reach and involve the people who share the greatest concern.
The hon. Member for Crewe and Nantwich (Mrs. Dunwoody) mentioned the Commonwealth and the Commonwealth ladies. Britain gives a unique input. We cannot do any other, because we are unique in having the Commonwealth, with 51 nations at all levels of development. At any Commonwealth gathering, we learn directly from people we know and trust precisely what the individual problems are.
I have just been to Jamaica, Barbados and St. Lucia, three islands in the West Indies which are at quite different stages of development—[HON. MEMBERS:
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"Bananas."] I learned quite a lot about bananas, and I now know that there are big differences in the views on bananas held in the Windward Islands, in St. Lucia and in Jamaica. There is not necessarily an overall solution for helping each country. Having the Commonwealth makes us unique in the world, and therefore able to make a much greater contribution in aid and development.
We are also unique in having the Commonwealth Development Corporation. The agencies that are available to other countries must envy us the CDC. It has £1.5 billion of investment, 40 per cent. of which is in sub-Saharan Africa. I suspect that most hon. Members here have seen Commonwealth Development Corporation schemes in countries that would otherwise get no inward investment.
The corporation's schemes prove that one can have a successful, profitable investment in countries that would not attract private investment. The corporation can give the lead in how to invest, and because it has extended terms and does not demand immediate commercial returns, it can encourage the people in those countries and those who work on the projects to see that they can make a real success of a whole range of issues.
There is an endless debate about how best to focus one's aid programme. The Labour party has focused on personal services, which are important. However, time after time, one has seen schemes in different countries, such as health schemes in Tanzania and in Ethiopia, which are not sustainable by the country's economy once the aid programme has finished. One has seen operating theatres and drug schemes that cannot be sustained unless one continuously gives aid.
We must strike a balance between direct personal services which can be sustained by the country concerned—that does not necessarily mean building a western-type hospital—and infrastructure which, in my judgment, is even more important in enabling a country to produce for itself.
In Kenya, a road that many who work with the aid budget would argue was not poverty relief has linked a series of villages and farms to the airport in Nairobi. That has resulted in us being able to get Kenyan beans at any time from any supermarket in Britain. The Kenyans have been able to utilise their climate for a wider development of agriculture, to their overall benefit.
Anyone who knows Mozambique, for which we cannot claim any responsibility as we were not the colonial power, knows that infrastructure is essential. One can waste so many resources in trying to get from A to B. One cannot go from the north to the south in Mozambique without taking to the sea, taking to the air or driving through three other countries. It is an important element of poverty relief to look at how one can design a basic economy that enables people to succeed.
Sub-Saharan African countries are often impoverished because of their inability to trade with one another. Apart from Nigeria and Ethiopia, most of the 55 countries in Africa have small populations and cover huge areas. Most have a distinct inability to trade with the others. The overall level of trade between one sub-Saharan African country and the others is about 5 per cent., whereas in this country and the rest of Europe, the equivalent figure is nearer 70 per cent.
We need to look critically not just at the micro-level of personal services, but at the macro-level, and at how one develops an infrastructure which allows sub-Saharan

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Africa, about which we all care because it is the worst part of the world and the one that is slipping back, to develop. We need to balance personal services and the sustainability and development of the economy in which we are interested, so that the people can re-direct their own resources, having got the debt relief.
From our know-how fund to eastern Europe, we can see that, once one has the infrastructure, the transfer of know-how can be enormously beneficial and easy, thus giving a great deal of added value for a relatively small amount. Harare in Zimbabwe is twinned with my town, and as a result, we are able to give direct technical assistance in all sorts of ways which produces a higher standard for Harare, with relative ease. All those issues need to be looked at carefully.
The hon. Member for Eccles also did not mention our reputation for disaster relief. This country gives a higher proportion of its aid in disaster relief than other countries do, mainly because we are good at it. We can act quickly and effectively in all sorts of situations.
Last month, we gave assistance for fire victims in Burma, food distribution to survivors of a volcanic eruption in Cape Verde, flood relief in India, and even 15,000 goats for the agricultural rehabilitation programme in Eritrea, a country that has caused us concern for a long time. We should give credit to the Overseas Development Administration for its disaster relief programme, and we should recognise, yet again, that we give a lead. We should be proud of that, and should not niggle about it.
Hon. Members have referred to the proportion of aid that goes to the poorest countries. Over the years, it is remarkable how aid has helped the development of countries that have the potential to become countries that can give. I am sure that the aid we are currently giving to Vietnam and Cambodia will fall into that category.
The combined resources of the 15 countries of the European Union, through the European development fund, can do a great deal more in terms of infrastructure than can be done by 15 bilateral programmes. Again, Britain gives a lead, because of its experience and because of its links with the Commonwealth, in directing the aid programme and in giving an input of knowledge that will, one hopes, make the programme better.
The Select Committee on Foreign Affairs produced a report on the balance of European aid, multilateral aid and bilateral aid. Of course we support the quality of our bilateral aid programme, but we should realise that it is essential that our Ministers should ensure that the money that goes to the European Union has a similar, but greater, effect, because there is an accumulation of funds from 15 countries. Exactly the same point applies in the United Nations, where we are among the strongest supporters of the multilateral programmes for which the UN is responsible.
Britain gives a lead in all these issues, and we shall continue to give a lead. Many of us recognise that the transfer of resources and aid is an essential element of Britain's leadership and international position. We shall be vigilant in ensuring that the British Government, whichever party is in power, maintain an effective and good aid programme. To many of us, that programme has great significance, and we have devoted a great deal of our parliamentary careers to supporting it.
8.48 pm
Mr. Matthew Taylor: This is an important and welcome debate, which has been treated seriously, as befits a subject addressing the needs of a very large number of people across the world. In every speech so far, we have heard that more than 1 billion people in the third world live in absolute poverty, but we should not forget that 1.5 billion people lack access to health care, and 1.75 billion people are without clean water.
Those figures illustrate the depth of poverty we need to address in our policies on overseas aid. We must remember, however, that behind those unimaginably vast figures lie individual people—families, children, men and women with the same human feelings as our constituents and our own family members. We have to hold on to that thought in addressing these issues, because, in a way, the very large figures that we put about almost mask the reality of what happens to those individuals in their own communities.
It has been said that, although we do what we can to alleviate such abject poverty, at the end of the day it is not our problem. I suspect that all hon. Members have heard constituents—albeit a minority of them—make that case. It is simply not true, and I shall give three examples why.
First, to put it in brutal economic terms, poor people cannot provide new markets for our goods. Secondly, third-world problems also feed first-world problems. For example, I do not believe that we can expect a country such as Colombia to be able to stop effectively the narcotics trade when its farmers cannot afford to grow other crops and the state cannot afford to tackle a multi-million—indeed, multi-billion—pound international trade.
Thirdly, poverty breeds war. Increasingly in the modern world, war can touch all of us economically, but—potentially even more important—it can also touch us through the use of nuclear, chemical or biological weaponry. Yet it remains the case that the struggle of developing countries to overcome such problems is too often overwhelmed by the struggle to repay debt to the developed world, and to maintain essential trade.
So overseas aid is crucial. Indeed, it would be better if we talked about it as overseas investment in the future—an investment to turn countries round, to our mutual advantage—and not as aid which, in some sense, is charitable and which we could withdraw if we so chose. Overseas aid is fundamental to the interests of this country as well as crucial to the fight against poverty.
Appropriately and sensitively targeted and delivered aid, often through non-governmental organisations, and always—I hope—delivered in co-operation with the people in need, can be of substantial benefit. As such, the British public have again and again showed their support for helping the world's poor.
The public's generous response to famine and poverty has been contrasted too often, although not always—I do not deny that the Government have measures of which they can be proud and it would be foolish and unhelpful to deny that—with the self-interested attitudes of the UK Government, which have undermined the overseas aid effort. Britain's record of overseas aid has not been the endless story of good news that Ministers have suggested.
The truth is that neither Conservative nor Labour Governments have kept their commitment to move towards the United Nations target of 0.7 per cent. of gross

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national product for official development assistance. Instead, we have consistently managed a figure lower than the European Union average and, in 1993, British aid amounted to just 0.28 per cent. of GNP.
I say to Ministers—and, indeed, to the Labour Front-Bench team—that, if they have no intention of delivering the commitment, they should have the honesty to say so, and the courage to explain it. I do not think that it does anybody any good if it is a mythical target that is so far from being achieved, and which is utterly impractical, given present Government policy and decisions in the spending round. It certainly does not help to feed those people who need feeding.
While the figures are important, I agree with the Minister that the quality as much as the quantity of aid is crucial. I want to concentrate on the effectiveness of British aid.
Too often, Governments, especially this Government, have elevated commercial objectives above humanitarian and development objectives: first, by tying two thirds of aid to purchases from Britain; secondly, by failing to target aid sufficiently on the poorest nations; thirdly, by linking aid to arms purchases and failing to encourage good Government; fourthly, by failing to promote sustainable development. I shall illustrate why I believe that that is the case. There is plenty of evidence to support those claims.
Much British aid is tied to purchases from Britain. The OECD analysis in 1991 showed that 72 per cent. of British aid was tied, compared to an international average of 33 per cent. Similarly, in 1992, 67 per cent. of British bilateral aid was tied, compared to an international average of 40 per cent. In being tied to purchases that the developing country often does not need—indeed, sometimes has no use for—such assistance fails to reduce poverty or promote sustainable development.
Mr. Baldry rose—
Mr. Taylor: I shall develop that point and give way to the Minister in a moment. I wanted to refer to the 1993 OECD report, which said:
"tied aid procurement can mean that recipients pay on average 15 per cent. above prevailing prices for goods that may not correspond to development priorities."
Mr. Baldry: I was wondering whether the hon. Gentleman could cite any overseas development project announced in the past year which he thinks should not have been allowed. Will he tell the House, and make it clear which projects the ODA has taken forward in the past year and he feels should not have been taken forward?
Mr. Taylor: The first part of my answer to the Minister is that I am looking at the history of this Government. If he is conceding that mistakes have been made in the past and that errors are now being corrected, I would agree with him. As the Minister knows, the essential issue is the competing options, and to give the Minister the answer that he is asking for would be to say that one project in itself had no value.
That may not be the case, but there are opportunities to make still better use of resources, in particular for aid to be targeted at local communities—for example, to support non-governmental organisations' pioneering work in
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helping women within those communities. They bear many of the problems to which I have referred in developing countries.
Lady Olga Maitland: The hon. Gentleman has cast a gross slur on British companies, which have done such useful and excellent value-for-money work in third-world countries. It is incumbent upon him to state the exact name of a company that he believes is ripping off a third-world country. I do not accept that he could name one.
Mr. Taylor: If the hon. Lady is suggesting that aid and trade have never been abused, I cite the examples of helicopters sold to India and the Pergau dam. The simple fact is that there are plenty of such examples, but I will not bore the House with them. The hon. Lady has missed the point if she thinks that I am attacking British companies, which understandably take advantage of whatever opportunities they can. I am attacking Government policy. The hon. Lady should understand that.
The aid and trade provision, which is part of our aid programme, was established under the previous Labour Government. It gives a small number of British companies subsidies to compete for contracts in developing countries. That provision has been particularly destructive. ATP accounted for 9 per cent. of Britain's bilateral aid in 1993 and lay behind the Pergau dam scandal. That scandal exposed the fundamental problem with ATP, because it is dominated by the needs of British business, but funded from the ODA budget. That reveals an internal conflict. The needs of British business should be removed from the ODA budget.
Tying aid to trade does not necessarily benefit either the donor or even the recipient economy. The "ATP synthesis evaluation study", conducted by the ODA and the Department of Trade and Industry, found that
"none of the projects evaluated in 1990 benefitted the poorest social groups directly to any great extent."
That is my point. Those projects may have provided some benefits, but they were not directed at those most in need, who were not placed high enough up the priority scale.
Mr. Andrew Rowe: Will the hon. Gentleman give way?
Mr. Taylor: I will not give way. I have already done so several times, and the point is clear.
Another ODA-DTI study of ATP-supported projects found that
"very few real economic benefits for the UK economy as a whole appear to have been realised in practice."
There is everything to be said for helping our industries and our businesses to obtain contracts, but that is the job of the DTI and should not be funded from the ODA budget. The Government must tackle unemployment and the needs of industry through better economic policies at home and not by raiding the aid provision, which is intended for the poorest people in the world.
The Government have admitted that just 10.7 per cent. of bilateral aid went on basic needs in 1992–93. In 1994, the Development Assistance Committee review of British aid showed that just 6 per cent. of bilateral aid to low-income countries in sub-Saharan Africa went towards education and social services in 1991. I believe that the principle of aid must be to make it work for the individ-

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uals in developing countries who most need it. That means developing education, health, telecommunications and the infrastructure.
More development assistance should be devoted to improving investment opportunities in developing countries, particularly for local enterprises.
Mr. Cash: Will the hon. Gentleman give way?
Mr. Taylor: No, I will not, as I have already done so several times.
Those local opportunities are often not realised, simply because of a lack of knowledge and technical expertise. Technical assistance should therefore be supported and expanded through the work of organisations such as the United Nations Conference on Trade and Development.
Miss Emma Nicholson: Will the hon. Gentleman give way?
Mr. Taylor: I have given way several times. I would be criticised more for speaking for too long than for not giving way. I hope that the hon. Lady may have a chance to catch your eye, Mr. Deputy Speaker.
The problems with the Government's provision of overseas aid reach beyond its quantity and the conditions imposed. If we look at the countries that benefit from our aid provision, the evidence is equally disturbing. Despite the Government's commitment to concentrate aid on the poorest countries, in 1988, just 69 per cent. of Britain's bilateral aid was allocated to the 50 poorest nations. There seems to be a tenuous link between a country's income per head and the amount of aid it receives. The neediest countries are not receiving the most aid. In 1992–93, only three of the top eight recipients of aid were UN-defined least-developed nations.
Whatever the Government say about the link with arms, the simple fact is that, instead of a correlation between aid and those countries in the greatest need, there appears to be a growing correlation between the failure to direct more aid to the poorest nations and arms contracts.
Oman, whose GNP per capita is more than $6,000—higher than that of aid-giving Portugal—has seen its aid double during the lifetime of the Government. In 1994, however, it ranked third largest in the list of purchasers of arms from Britain.
Although Ecuador, Colombia and El Salvador share the same level of poverty, in 1994 Ecuador received five times as much aid as Colombia, and eight times as much as El Salvador. The difference is that Ecuador was also the fifth largest purchaser of British arms.
Even more striking is the case of Indonesia. Our aid programme to it has quadrupled under the Government, while it has become the fourth largest purchaser of British arms—despite Ministers' commitment to promote good government through aid. Since 1975, when Indonesia invaded its neighbour East Timor, a third of the latter's population—20,000 people—have been killed. Surely we should be suspending aid and putting pressure on the Indonesian Government, instead of backing a regime with precious aid in what appears to be a response to massive arms sales.
The development projects promoted by British bilateral aid should have one other key feature built into them. They should be tied to environmentally sustainable, as
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well as economically and socially beneficial, projects. At present, the majority of aid is targeted on large-scale capital-intensive projects which perpetuate existing social inequality and accelerate the deterioration of the environment.
The Government promote environmentally damaging projects such as the Pergau dam, and the environmental awareness that is developing at home—I acknowledge the progress that the Government have made in that respect—is not matched by an environmental awareness in our overseas development projects, or in our approach to development internationally.
If we are to have a genuinely sustainable world economy, there is no question but that the bulk of the environmental problems must be tackled in the developed nations. The developing nations have a right to expect the kind of social benefits which come from economic development, but such development in itself will have an impact on the environment unless two things happen.
First, developments must be directed specifically towards environmentally sustainable projects, and that must be a part of our aid package. This country must recognise that we not only have to bear the costs of sustainability at home, but that we must also help developing countries bear the costs. We have been the beneficiaries of the pollution until now, and we therefore owe those countries that much.
Secondly, we must recognise that to allow development abroad, we have to go even further at home in tackling pollution than would be the case if pollution was shared equally and globally. Those countries have not caused the pollution or benefitted from the development. They cannot be expected to bear the costs in the same way as we must.
Several hon. Members rose—
Mr. Deputy Speaker (Sir Geoffrey Lofthouse): Order. There are four hon. Members who wish to speak in the time remaining before the winding-up speeches. I would appreciate it if speeches were kept short, so that all four might be called.
9.6 pm
Miss Emma Nicholson: I am most grateful for the opportunity to put a few points.
I support the Government amendment and strongly oppose the rag-bag of items that make up the Opposition motion. The Opposition forget that, during the past decade and a half, the socialist policies that their motion reflects have been discarded by nearly every Government in the world. The primacy of the market for freedom and wealth creation has a long tradition in the Conservative party, and I believe that we have also made one notable convert in the present leader of the Labour party.
Tonight the hon. Member for Eccles (Miss Lestor) led for the Opposition with passion and with a commitment to overseas aid. I pay tribute to the hon. Member for Truro (Mr. Taylor), the spokesman for the Liberal Democrats, who is still with us although he is not listening. Despite the passionate commitment of those hon. Members, they were just rotating old and outdated statements that bore little relationship to the reality of today's overseas aid programme, the results of which I have seen on the ground in many nations of the world.

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The hon. Member for Truro talked about the need to help the poorest of the poor, but he wholly overlooked the fact that some of the poorest of the poor live in some of the better-off nations, and they are helped by our aid programme. Things are not always what they seem. We can give money to the poorest of the poor nations—in terms of how poverty is identified internationally—yet still not create the job opportunities on which economic development and the future of families rests.
I was saddened that both Opposition spokesmen made statements such as, "We must give more aid for primary education, health and so on." Surely we should try to use British aid to create jobs that will enable people to cope with their own lives. The Government have achieved that objective quite superbly in the past 15 years.
I pay special tribute to a very successful part of the Foreign Office, and formerly part of the British overseas aid programme, the Commonwealth Development Corporation. I did not hear Opposition spokesmen pay tribute to the corporation's job-creation activities. It distributes a rotating loan package of almost £1.5 billion to more than 47 different nations around the world. Why did the Opposition spokesmen ignore that wonderful job-creation programme, which has been in place since 1947?
Mr. George Foulkes: The hon. Lady may have missed the fact that we spoke in favour of the Commonwealth Development Corporation legislation when it was considered by the House, and there may be further legislation of that sort in the future. I think that it is a case of horses for courses.
Miss Nicholson: I was delighted to take part in that debate and to pay tribute to the Commonwealth Development Corporation. However, I was very surprised that Opposition Members, with their constant bleating about old-style socialist policies—moan, moan, moan—failed to acknowledge that great British success story. I hope that the Government are projecting that bilateral partnership between Britain and individual developing nations as something that other nations should copy.
The Government's amendment concentrates on the essentials. One of the most important points is that aid must not be a crutch; it must be a means of creating better societies and enabling people to look after themselves. Aid must be used to assist societies to improve their long-term means of production and economic benefits. Quality aid is essential, and I am fortunate to have seen many of the Overseas Development Administration's quality programmes in operation.
I return to the supposed statement by the Foreign Secretary to which the hon. Member for Crewe and Nantwich (Mrs. Dunwoody) referred. She attempted to denigrate his statement that, as more than half of Britain's aid now goes to the European Union and other multilateral organisations internationally, British aid becomes less and less identifiable as such. The Foreign Secretary is correct, if he did indeed make that statement. Every single barrel or boatload of ECO aid—the emergency aid of the European Union—must be labelled with the European Union's logo. The Foreign Secretary is correct to say that more of our aid is being spent through multilateral organisations, including the European Union.
I have had some experience of European Union aid provision, and I hold it in very high regard. I hope that Britain will play a larger part in the multilateral
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organisations through which some of our aid is being spent. I draw the Minister's attention yet again, in the name of education and culture, to the need to rejoin UNESCO. This year is the 50th anniversary of the United Nations and the anniversary of Britain's founding of UNESCO.
The quality of British aid is exemplified by the Conservative amendment and by the work of the ODA. I am glad that, through the Government, we have brought our influence to bear in the cause of good governance internationally. Opposition Members should not be so critical of the International Monetary Fund and the World bank; I am pleased that our Government have been at the forefront of securing alterations in the way in which World bank money and International Monetary Fund influence is being used to create better governance in the countries that we attempt to assist.
There is certainly much more to be done, but this evening I urge hon. Members to discard the rag-bag of items proposed by Opposition spokesmen and to give the Government's amendment their whole-hearted support.
9.14 pm
Mr. Mike Watson: Judging from Conservative Members' responses, it appears that my hon. Friend the Member for Eccles (Miss Lestor) touched a few raw nerves—some of them protest too much.
The Minister said that there are rumours of a global aid funding crisis, but the Government do not recognise it as such. How can he say that when, in 1993, for the first time in 20 years, aid from the richest nations to the poorest suffered a significant drop of some 6 per cent. or $5 billion? That represents a global aid funding crisis, as it shows that aid available is on a downward spiral.
The OECD investment assistance committee recognised that downward spiral and noted:
"The painful irony of the current situation"—
the reduction in aid—
"is that many developing countries could now use more aid, and use it well because they have been doing more than ever to help themselves."
It is unfortunate that the current figures mean that less aid will be available to developing countries.
Mr. Cash: Will the hon. Gentleman give way?
Mr. Watson: I shall not give way, as others are waiting to speak.
The debate is about United Kingdom aid, and it is important to focus on that. I agree with the Minister that aid as a proportion of the United Kingdom's gross national product has remained stable at 0.31 per cent., but that is hardly a reason for self-congratulation, bearing in mind that the United Nations target is 0.7 per cent. Although we do not exactly expect the Government to reach that target in one Parliament, they have a duty to outline how they plan to move towards it.
Conservative Members asked about Labour's position. It is fair to say that we recognise the United Nations target, but as the total aid budget is £2.5 billion, or less than half that target, it is not feasible to add 55 or 60 per cent. on to that in five years of government. Although non-governmental organisations may not like hearing that from a Labour Member of Parliament, we have to be realistic and set out a plan so that we can move towards achieving the target. The Labour party will certainly carry

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that commitment into the next election. It will be welcome, as it will reverse the trend and for that reason it will be put in positive terms.
I accept the Minister's figures on total United Kingdom aid, but he failed to tell us that, between 1992–93 and 1993–94, the volume of United Kingdom aid to developing countries fell by some £50 million. The plans outlined in the Foreign and Commonwealth Office departmental report showed that British aid to developing countries, far from moving towards the target to which I referred, is likely to decline as a percentage of national income over the next few years—all right hon. and hon. Members would deprecate that.
It is important to place United Kingdom aid in the international context, just days after the G7 summit that considered such matters. I have seen the communiqué from Halifax, which contains some encouraging aspects. Obviously the renewed commitment of G7 countries to sustainable development and the realisation that extreme poverty and marginalisation of the poorest countries is not compatible with the general prosperity and security of the world as a whole is welcome. It also pleasingly acknowledged the particular problems faced by sub-Saharan Africa—a subject on which I have spoken at some length in the past. There are also calls for donors to meet their commitments to International Development Association 10 and that is needed, as is a significant replenishment of IDA 11.
The communiqué contained good ideas and intentions, but failed to say how the countries involved would achieve them. It set out no strategy to meet the policy that has been adopted. It did not mention achieving or approaching the UN target of 0.7 per cent. of GNP, so we have to question its effectiveness.
President Chirac of France, who should be an ally of the Government, at least in ideological terms, criticised in quite florid language the "immoral" shrinking of the United Kingdom aid budget when the United Kingdom is calling for more humanitarian assistance throughout the world. I hope that the Government will eventually respond to that criticism: coming, as it does, from a like-minded person, it carries considerable weight. I hope that the Minister will refer to it later.
The Lome mid-term review financial negotiations are currently stalled—a matter of concern to anyone with an interest in overseas aid. There is to be a summit at Cannes towards the end of June, as the French presidency comes to its conclusion. Do the Minister and his colleagues intend to try to break the deadlock, so as to agree the financial resources for the eighth European development fund, which supports the Lome convention?
Surely Foreign Ministers at that summit must agree the compromise proposed by the French presidency, which would still fall short of what the ACP countries want. They want 15 becu; the French proposal is for about 14.3 becu. The United Kingdom and German Governments are arguing for a cut in their contributions, which would mean that the eighth EDF would amount to only 12 becu, which is only a small increase on the seventh. That would be scandalous, but it describes the point at which the talks have stalled.
What does the Minister think the United Kingdom can do at the summit to break the deadlock; what initiatives does he plan to take? Contributions to the EDF are
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voluntary, whereas the Edinburgh summit committed EU member states to significant increases in their payments to other parts of the world—especially eastern Europe. I do not want to take away any money from eastern Europe or the former Soviet Union—I want democracy to be entrenched there. The key to the issue is how to ensure that help for those countries is not given at the expense of the poorest countries.
Like some of my hon. Friends, I should like less money to be spent on multilateral aid and more to be retained for the bilateral aid budget. Certainly, there is a fine line to be drawn. We must face up to our responsibilities towards the ACP countries, however, and we must try to break the logjam.
The Foreign Affairs Select Committee noted in its report on European Union aid last year that EC aid spending is better focused on poverty than are UK bilateral aid projects.
One other point has not been given much consideration this evening, but it is important to our overall aid strategy. I refer to the impact of aid on the lives of women in the developing world. I read in the part of the Government expenditure plans relating to the ODA that one of the latter's aims is to promote the status of women, but I looked through 40 or so pages of the report on the ODA and found only a short reference to what it is doing for women—about £80 million-worth of aid goes in their direction. There is but scant detail of what the money has been used for. Despite the lofty aim of promoting the status of women, there is little evidence that it is being achieved.
I find it strange that there is so little detailed information on how the strategy is to be taken forward. About a year ago, I received a publication—one of a series of development priorities guidelines—entitled "Women's Issues in Developing Countries". It includes six detailed points on how a gender strategy might be implemented. Owing to the lack of time, I shall not go into them. The document is published by the British Council, which administers quite a lot of aid project work on behalf of the ODA. The document sets out a clear strategy, and in 1992 the British Council appointed a women-in-development officer. The guidance, too, is clear, as are its annual reports on the impact of the projects on the lives of women, yet the ODA appears unable to come up with such detail.
Mr. Baldry: The annual report submitted to the Overseas Development Administration contains a chapter dedicated entirely to the subject of empowering women.
Mr. Watson: I have not seen the report to which the Minister refers. I have, however, asked for clarification, which so far has not been forthcoming.
Mr. Baldry: It is the annual report.
Mr. Watson: I am talking about expenditure plans for the forthcoming year, about which there is little detail. That is unfortunate. I shall certainly refer to the document to which the Minister has drawn my attention. I thank him for so doing.
We must recognise that women comprise about 70 per cent. of the world's poorest people and that they do most of the work. In many ways, they seriously lack economic, social and political opportunities to enable them to improve their lives. I should like the aid programme to place more emphasis on their unfortunate position.

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It is difficult in such a short time to cover some of the other issues that have been raised in the debate. I wish, of course, to allow other hon. Members to contribute to it.
The overblown reaction of the hon. Member for Torridge and Devon, West (Miss Nicholson) to the opening speech of my hon. Friend the Member for Eccles, who spoke from the Opposition Front Bench, demonstrated that the Government are a little touchy on overseas aid. They need not be so. The motion is constructive. It shows that the Labour party has a positive agenda on the way in which we develop aid.
It is clear, however, that we and the Government have different priorities. One of our priorities will be to establish a separate department of international development. We shall return to 1976–79, when there was a separate department for overseas development. That will underscore the importance that an incoming Labour Government will give to overseas aid. A separate department could be introduced at remarkably little additional cost to the Exchequer. I do not want the Government to throw up the argument that a separate department could not be introduced for reasons of cost.
Status must be given to the overseas aid programme. It should not be regarded as a branch line of the Foreign and Commonwealth Office. The current overseas aid programme is, unfortunately, lacking in status. We should focus on it by entrusting it to a Cabinet Minister, who should have his or her own department. There should be a Select Committee with responsibilities for overseas aid and a specific question time so that relevant issues could be considered in greater detail. I am sure that that approach would prove universally popular. It reflects a policy that the Labour party will introduce when in government. I commend it to the House.
9.27 pm
Lady Olga Maitland: The Government have nothing to apologise for given their enormous commitment to overseas aid. Year on year, they have increased resources devoted to our aid programme, and have done so during a period in which we have had to keep our eye on public spending. We have had a tight economic schedule in recent years. It is remarkable that, in the past year, the Government have increased their spending on aid by £115 million. A total budget of £2.2 billion cannot be insignificant.
I am sorry that the Opposition find it extremely difficult to acknowledge the enormous amount of work that the Government have done on overseas aid. It seems that they are ignoring the praise that the Government have received from other areas. The OECD noted:
"The UK bilateral programme is highly concessional and well organised … based on substantial national expertise and largely orientated towards the poorest countries."
Surely it would be hard to find a better statement than that from the Government's point of view.
The Opposition say that we are failing in the commitment to which we all aspire to raise aid spending to the target of 0.7 per cent. of gross national product. They suggest that we are alone in not reaching that target. It has already been said that many other countries have fallen way below the level of aid spending that we have
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achieved. The House should be referred to the comments of my noble Friend the Minister of State, Baroness Chalker, who said:
"No one would thank us for putting ourselves in hock to the IMF by such spending as is boasted about by some Members of the Labour Opposition."—[Official Report, House of Lords, 23 June 1992; Vol. 538, c. 431.]
I do not wish to spend any more time commenting on the Opposition, because there is so much to be positive about when drawing attention to the Government's achievements.
It is admirable that we have set aside considerable resources for aid and that we are ensuring that they are directed to the areas where they will have most effect. It is important not only to ensure that it is effective but that it is well delivered, that it goes through the non-governmental organisations, which are best placed to facilitate us in that regard, and that we use agencies in this country, which are best placed to help us.
If my hon Friend the Minister will forgive me, I shall draw the attention of the House for a moment to the Crown Agents, whose expertise stretches back more than 100 years. A Bill is now going through Parliament to give the Crown Agents greater independence to carry out its work in future. The truth is that the Crown Agents is a flagship for British aid overseas, serving 150 countries. Within its procurement programme, the Overseas Development Administration forms its largest customer.
The Crown Agents has undoubtedly set a great seal on its achievements by the superb work that it has done in facilitating aid in Bosnia. It has not only delivered value but has provided dedication, commitment and extremely brave ODA workers, six of whom have gained an award for their valour in extremely difficult times. That is an example of British aid overseas. We should be proud of what we are delivering. We should be proud of the fact that, throughout the world, countries come here to seek expertise, dedication and a knowledge that is second to none about how to put it into action.
9.30 pm
Mr. George Foulkes: At the start of the debate, we had the unusual privilege of welcoming the right hon. Member for Eddisbury (Mr. Goodlad) to the debate. He is not with us at the moment, but it is unusual for him to lead off one of the debates on aid. It is rather unfortunate that the principal aid Minister is not in the House of Commons, and even more unfortunate that she is not in the Cabinet.
Mr. Watson: I wonder whether my hon. Friend saw a report in The Sunday Times, which said that the hon. Member for East Lindsey (Sir P. Tapsell), who commenced the Fresh Start group and held an important meeting last week, has apparently offered himself to the Prime Minister as a future overseas aid Minister? Would that not be one way of getting around this problem? Having said that, if he did travel overseas, would it not be best that he stayed there?
Mr. Foulkes: I am not an avid reader of The Sunday Times, but I know that there would be some awful prospects if some hon. Members became overseas aid Ministers. I am sure that the right hon. Member for Eddisbury would welcome elevation to the Cabinet and promotion to the post of overseas aid Minister.

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We also had the rather unedifying experience, for the Opposition, of being preached at by the hon. Members for Sutton and Cheam (Lady Olga Maitland) and for Torridge and Devon, West (Miss Nicholson). I shall try not to be distracted by their lectures to myself and my colleagues.
Considering the somewhat calamitous events that have been afflicting the Government, particularly the proceedings earlier this evening, the Government might have been lulled into a mistaken belief that this debate would be a respite for them. The truth is that overseas development is yet another area in which they have abjectly failed.
In the past, debates on development have usually been seen as a chance for the Government and the Opposition—indeed, we have seen some of it again tonight—to throw conflicting figures at each other; our own sometimes at the request of the NGO community who, justifiably, want to help a developing world that is crippled by poverty, and Conservative figures tending to come from a frustrated Treasury that is rather keen to boost the bank balance and to bribe voters in the forthcoming general election, which cannot be too far away.
The right hon. Member for Eddisbury again stood at the Dispatch Box and tried to convince us how wonderful British aid is and of the poverty that is being reduced, but my hon. Friend the Member for Eccles (Miss Lestor) successfully and with great sincerity managed to inform the House and the Minister of the facts, the real problems that confront more than 1 billion people every day of their lives. The Government do not seem to realise—I do not include all Conservative Members purposely—the gravity of the situation that faces more than one fifth of the population of the planet. We Labour Members, as democratic socialists, say that there can be no retreat from our responsibilities as citizens of the world. We know that the Conservatives have somewhat different priorities, but I do not feel at all embarrassed about repeating ours.
The Government's aid programme over the past 16 years has been widely attacked. Recent reports from many aid organisations refute the statements and figures given by Lady Chalker and repeated again and again by her stooges tonight. The reality is not, as Lady Chalker stated in The House Magazine, that Britain has one of the largest and most efficient aid programmes; the reality is that aid has been cut chronically, diverted dogmatically from those who really need it and politically perverted to further privatisation, arms sales and rewarding the Government's supporters through the aid and trade provision programme that they have suborned and manipulated.
Mr. Cash: Will the hon. Gentleman give way?
Mr. Foulkes: The hon. Gentleman has been trying to intervene for a long time. I will give way, although I may regret it.
Mr. Cash: I am grateful. Does the hon. Gentleman agree that in Uganda, where President Museveni has shone like a beacon in connection with the whole question of development in the third world, his privatisation projects are proving increasingly successful? Furthermore, he has just announced proposals to ensure that the people of his country operate on a basis of lower inflation. Do not
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those proposals—which are dramatic by any standards—demonstrate that policies carried out by a highly respected and extremely efficient Government can produce very good results?
Mr. Foulkes: I believe that such countries will increasingly come to realise that, although privatisation can be helpful when there is real competition, the privatisation of utilities that are natural monopolies can create tremendous problems, and has done in this country. I fear that the problems in the developing countries will be even greater than our problems of rising prices and people at the top ripping off the utilities. I do not wish to be diverted, however; I want to concentrate on poverty, which must be the central focus of our aid programme.
It is admirable that Ministers—including the Under-Secretary of State who will reply to the debate, and the Minister for Overseas Development herself—visit Ghana, Malawi, Mozambique, South Africa and Swaziland, but why the delay? Why do those countries receive so little of our bilateral aid? The 1994 Development Assistance Committee of the OECD has pointed out to the Government that our aid programme is not poverty-focused—but perhaps Ministers are spending too much time visiting countries to read the criticisms contained in OECD reports.
The 1994 ODA statistics show us the Government's idea of poverty focus. The Minister referred my hon. Friend the Member for Glasgow, Central (Mr. Watson) to that report; if he looks at it again, he will see which countries are receiving assistance from the United Kingdom—Bermuda, the Bahamas, Indonesia, Malaysia, China and Nigeria. Those are not countries in abject poverty; that is not a poverty focus for our aid programme.
Moreover, the four last-named countries have appalling human rights records. I have just received a letter from the daughter of Chief Abiola. The hon. Member for Torridge and Devon, West (Miss Nicholson) spoke of a record of good government; I wonder if we really have such a good record of ensuring that the countries to which we give aid provide examples of good government.
The hon. Member for Truro (Mr. Taylor) mentioned Indonesia. Is that a country with good government? No. I think that we have some way to go before we can be happy that our aid programme really supports good government.
Miss Emma Nicholson: Will the hon. Gentleman give way?
Mr. Foulkes: No.
British aid is not targeted on those who need it most. The projected cuts in future budgets will further squeeze sub-Saharan Africa, with the aid budget set to fall by £116 million over the next two years. The mere fact that the ODA's seven development objectives were headed by economic reform, with poverty reduction only at No. 4, shows the lack of emphasis given to poverty in the Government's programme.
I now turn to the question of bilateral versus multilateral aid, which was mentioned by my hon. Friend the Member for Glasgow, Central and others. The continuing drastic decline in the bilateral aid budget is consistently blamed on our increasing multilateral commitment. We heard that again in the debate.

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Regrettably and appallingly, in recent months the aid budget has been used as a bargaining chip with European Union Ministers in the Lome negotiations. Ministers embarrassed our African, Caribbean and Pacific colleagues and our European partners by proposing a cut of 29 per cent. in our Lome contribution. As my hon. Friend the Member for Glasgow, Central said in an intervention, how does that correspond to the Edinburgh summit commitments? It completely contradicts them.
The Government say that they want to say no to Europe occasionally, but they should not do that in this area. Through the ACP countries, we give vital assistance to some of our former colonies, the countries about which the Minister spoke so highly in a debate on the Commonwealth. If the Government are to put their money where their mouth is, they should give more to that fund.
The Government's position has been a major obstacle to the replenishment of the European development fund. As my hon. Friend the Member for Eccles told the House, in March the Foreign Secretary told the Overseas Development Institute that the EDF was one of the better parts of European aid. I underline and repeat the question by my hon. Friend the Member for Glasgow, Central in asking for a commitment from the Minister that at the Cannes council the Government will change their attitude on this matter.
The hon. Member for Broxtowe (Mr. Lester) spoke about tied aid and the aid and trade provision. The use of tied aid by this country is not alien to the Labour party. We developed the principle when the aid budget was increasing and our predecessors thought that a small amount should be given to the ATP programme. But when the Tories took office, their priorities were industrial and commercial instead of developmental. That is how the ATP scheme was abused and corrupted by the Government. Their new rules have not even been adhered to. The restriction to countries with a $700 or less per capita income has already been broken. The plan to restrict the value of any project to £46 million has been diluted by the Government. They cannot even keep to the rules that they have set.
My hon. Friend the Member for Eccles spoke about debt. In answer to the hon. Member for Broxtowe, I can say that we accept what the Prime Minister did at Halifax in relation to gold stocks. That was a welcome step. It is nice to say something nice about the Prime Minister, although I may be one of the few people saying something nice about him these days. But as well as accepting our congratulations, he should accept our criticisms.
The debt of the developing world represents a staggering flow of aid, especially for the poorest countries of Africa. In a recent parliamentary answer to me, the Chancellor acknowledged that an 80 per cent. write-off of official bilateral debt owed to the Export Credits Guarantee Department and the Overseas Development Administration by the poorest countries would cost approximately £750 million. But such a gesture would help crippled economies and would result in the economic growth that the Minister constantly cites as necessary for development. I hope that he will give some further commitment to writing off the debt of those countries.
In the context of emergency funding, recent events in Rwanda and Bosnia have shown the need for humanitarian aid. That is because of the lives that it saves. The escalation of the conflict in Bosnia has tended to obscure the reality that both British and United Nations involvement in the area was agreed to ensure the safe
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delivery of humanitarian aid. Increasing pressure by the Republicans in the US Congress has demonstrated an all-too-familiar mix of ignorance and hypocrisy.
I do not know whether other hon. Members saw Congressman Bob Livingston, chairman of the House Appropriations Committee, advocate withdrawal of all troops and the lifting of the embargo on arms sales to the Bosnian Muslims. Nothing could be more designed to put UNPROFOR personnel, once again, in immediate danger and usher in a major escalation of the war, which would result in death, destruction, hardship and suffering. That is the opposite of what is needed in Bosnia today. However, the need for humanitarian aid is without question, in Bosnia and elsewhere. We must resist the temptation to allow our contributions in that regard to take away from continuing development aid to help the poorest countries of world.
Finally, I shall deal with the crux of the matter—the 0.7 per cent. target. The British record over the past 16 years is despicable. I mentioned previously that figures would be thrown acrosg the Chamber. Let me correct the figures that have been thrown by Conservative Members.
I say to the Liberal Democrat spokesman that the 0.7 per cent. target set by the United Nations is realistic. Further, that target was close to fruition under the last Labour Government. In the five years that we had to implement the UN figure, we made significant progress towards it.
We inherited an aid programme that had been reduced to 0.36 cent. In only five years, the Labour Government brought the programme to a peak of 0.51 per cent. and rising. That record speaks for itself, but since then, successive Conservative Governments have cut the figure to 0.31 per cent. Those cuts are set to go further, with the budget expected to fall to its all-time low of 0.27 per cent. in the near future.
Government excuses no longer add up. We cannot have an economy that is, as we are told, doing well, yet, when we are legitimately asked to help the poorest countries in the world, be told that they must get less and less.
Figures based on GNP hide the loss in real terms. This figure has not been brought to the House before, but it is startling. Cash prices give no indication of the full extent to which the developing world has been damaged by the reductions. If we take all the reductions cumulatively from 1979 to 1993—the latest available figures—the cumulative total that has been lost to the third world is over £10 billion. What is the Minister going to do tonight to replace that money, which is owed to the poorest people in the developing world?
My hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) said, rightly, that outside the House, there are Churches, voluntary organisations and individuals whose compassion for the developing world continues. For them, there is no compassion fatigue. The fatigue is on the Government Benches. Tonight, we have seen no sign that there will be a regeneration while the Government remain in office. The only way that the developing world could expect a fair deal from Britain would be if the Labour party replaced the Tories on the Government Benches. That cannot come too soon for Britain or for the people of the third world.
9.47 pm
The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Mr. Tony Baldry): It is always rather difficult to reconcile the

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indignation and enthusiasm of the hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) with the emptiness of the Benches behind him. This is an Opposition supply day. When the hon. Member rose to reply for the Opposition, there were precisely four Labour Back Benchers, three Labour Front Benchers and two Liberal Democrats present. During his speech he has managed so to enthuse the House that we now have six Labour Back Benchers, five Labour Front Benchers and three Liberal Democrats.
The debate has established that a large number of Opposition Members have not acquainted themselves with the facts. The hon. Member for Glasgow, Central (Mr. Watson), a member of the Foreign Affairs Select Committee, admitted that he had not seen the annual report on overseas aid.
The hon. Member for Carrick, Cumnock and Doon Valley said that we were giving money not to Commonwealth countries or poor countries but to affluent countries. If he reads the ODA annual report, he will see that we could not have set out the information more clearly. We put it in the form of bar charts, which could not be simpler. They show that, of the countries receiving aid, India receives £103 million; Bangladesh, Pakistan, Zambia, Zimbabwe, Uganda—
Mr. Foulkes: China.
Mr. Baldry: I do not know why the hon. Gentleman should object to China, a large and very poor country, receiving development aid. It is right that it should do so. The charts clearly show that Commonwealth countries and poor countries are receiving large sums of United Kingdom aid.
Britain is maintaining a substantial aid programme. At £2.2 billion, it is now the fifth largest aid programme in the world. Hansard will show tomorrow that there was no willingness on the part of the Labour party to commit itself to spending any more. We heard many weasel words about what happened or might have happened under the previous Labour Government, but there was no suggestion that the Labour party would spend more than £2.2 billion, perhaps because even the Labour party recognises that it is a substantial sum. Indeed, the previous Budget announced further increases. For 1997–98, the aid programme provision is £115 million higher than the 1995–96 figures. That is proof of the Government's commitment to maintaining a substantial and effective aid programme.
The June 1994 figures from the Organisation for Economic Co-operation and Development show that the United Kingdom was one of only seven countries to increase official aid in the preceding year. Our aid as a percentage of GNP is equal to the average for all donors. Of course, more than two thirds of our bilateral aid goes to the poorest developing countries, which is well above the average for all donors. Nine out of 10 of the biggest aid recipients are poor countries in Africa and Asia. The only exception is the former Yugoslavia, where Bosnia is the main recipient.
The quality of our aid is high. The OECD has recognised its effectiveness and its poverty focus, even if Opposition Members cannot. We have also led the way in promoting debt relief. We welcome the latest Paris Club
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agreement, which fully implements the Trinidad terms, including the 67 per cent. stock of debt reductions as proposed by my right hon. Friend the Prime Minister in 1990. My right hon. and learned Friend the Chancellor has recently launched initiatives on multilateral debt and, as was recognised by today's statement on the G7 report, the United Kingdom took the lead in Halifax on debt relief. We are also ensuring that not only Government money but private money is being invested in developing countries. Indeed, we are taking a lead in that area, too.
We have what is generally recognised across the world as a quality aid programme to help poor countries. We are the fifth largest aid donor but, to my mind, the size of our aid programme is by no means the only point to bear in mind. Our overseas development agencies are dedicated, practical and effective and the quality of their work is recognised world wide.
We have the fifth largest aid programme of £2.2 billion covering aid to developing countries, and that programme is increasing. That must be contrasted with what is happening elsewhere. Many other countries have frozen their aid programmes. My hon. Friend the Member for Broxtowe (Mr. Lester) read out a long list of countries that have reduced their aid budget, including Canada, Italy and Finland. The aid programmes of countries such as Germany and the United States have declined.
We, meanwhile, are managing to maintain our aid programme and we are showing the world that we can make a significant contribution. Our aid:gross national product ratio is almost exactly the same as the average of other countries. The Development Assistance Committee's 1994 figures will be published shortly. They will show that the UK is among the donors showing a real increase in aid in the two years before 1994.
Britain is not alone in facing the need to be responsible about public spending; other countries are in a similar position. We are managing to maintain a credible and sizeable aid programme. Volume, however, is not the only issue; one must also consider the quality of that programme. The quality of British aid is high. As my hon. Friend the Member for Sutton and Cheam (Lady Olga Maitland) mentioned, the OECD has recognised and publicised our overseas development programme's effectiveness, poverty focus and growing emphasis on encouraging the private sector.
Forty per cent. of our bilateral aid goes to countries in sub-Saharan Africa. Of course, the poorest countries of that region will continue to require substantial amounts of aid. Those countries have been and will continue to be a high priority for British aid, which is focused on the poorest countries. We must also ensure, however, that our aid programme is properly and satisfactorily balanced between multilateral and bilateral aid.
Until recently, about 40 per cent. of total resources were spent multilaterally and 60 per cent. bilaterally. The exact figure has varied from year to year, but things are set to change. For the first time, a majority of our aid will be spent multilaterally. Clearly, that is a matter of concern. That is why, when we negotiate on the next replenishment of the European development fund,. we must be conscious that every further pound that we spend multilaterally is one pound less that we spend bilaterally.
Mr. Foulkes: Will the Minister give way?
Mr. Baldry: No. The hon. Gentleman asked me a specific question on the EDF which I am trying to answer.

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Of course we shall continue to make a substantial contribution to the EDF programme. He prays in aid France. Of course it is in favour of the present EDF arrangements, because much of the EDF was geared to a situation that benefits former French colonies. Under the EDF, more money goes to Mauritius than to Bangladesh. We are seeking not only to ensure a substantial £1 billion-plus contribution to the EDF programme, but that we have a sizeable and responsive British bilateral programme.
It was Britain that initiated the Toronto terms, under which 20 countries enjoyed debt relief, it was Britain that proposed the Trinidad terms, and it is Britain that continues to take those forward.
We have had an aid programme of which we can all be proud. It is a sizeable aid programme. It is focused on poorer countries but, throughout the world, it is also doing fantastic work in disaster relief. One will find Overseas Development Administration personnel in Yugoslavia and Rwanda. My right hon. and noble Friend Baroness Chalker is in Angola, where, again, British aid workers, just as in Rwanda, have been at the forefront of ensuring that relief, humanitarian supplies, water, food, medical aid and equipment reach people who require them. That, and not the World Development Movement brief, which has been constantly repeated this evening by the few Opposition Members who have spoken, is the reality of our aid programme.
Every hon. Member and everyone in this country can be proud of our sizeable programme. It is focused on the poorest; it is of high quality and high value, ensuring that Britain can give of its best throughout the world. I invite the House to support the amendment in the name of my right hon. Friend the Prime Minister.
Question put, That the original words stand part of the Question:—
The House divided: Ayes 260, Noes 287
Question accordingly negatived.
Question, That the proposed words be there added, put forthwith pursuant to Standing Order No. 30 (Questions on amendments) and agreed to.
MADAM SPEAKER forthwith declared the main Question, as amended, to be agreed to.
Resolved,
That this House concerned by reports that one billion people throughout the world live in abject poverty, commends Her Majesty's Government's support for sustainable development and poverty alleviation through its support for economic reform, good government, and investment in people and productive capacity, as well as through direct action to provide the poor with opportunities to improve their lives; and urges the Government to pursue these policies with their development partners and multilateral agencies.

Gipsies (Essex)
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Burns.]
10.13 pm
Mrs. Teresa Gorman: I am grateful for the opportunity to debate the subject of gipsies in Essex. I commend the Government for introducing legislation in 1994 which gave local authorities and the police a great deal more power in dealing with a matter which has been a great problem for many years, particularly in the part of Essex that I represent.
The public clearly wanted something done about the menace of these itinerants, or gipsies, or didicois, or tinkers, or new age travellers, or mobile totters, which is what they are. There was a huge sigh of relief in November last year when the Criminal Justice and Public Order Act was finally passed, because it seemed as though something was to be done at last. We were grateful in the part of Thurrock and Billericay that I have the honour to represent.
These people have scant regard for the rights of others, and trespass en masse on people's property. The new legislation allows the police to take action if six or more caravans or lorries turn up on someone's private property. The Minister has sympathised with landowners and local communities because many householders have been affected and the value of their properties can be severely affected if they live near a piece of land that gipsies or travellers frequently visit. Power was given to the police to act with local authorities to deal with such invasions.
One my constituents—a Mr. Luck from Laindon—received a supportive reply from my hon. Friend the Under-Secretary of State who is present tonight on the Front Bench. He said:
"We do not believe that it is right that a private landowner should always have to bear the sometimes onerous cost of using his civil remedies to evict unauthorised campers, particularly when the encampment causes intolerable nuisance to the local community."
I should like to pause here to congratulate my hon. Friend, who has an excellent track record in speaking up about this menace, not just for his constituents but for the whole country.
The hard-working and honest farmers in my constituency are not being given the back-up the legislation allows, and they are still being forced to bear the costs. Farmers are harassed and intimidated by these people and then left to clear up the appalling mess that they leave behind. The travellers break fences and leave trails of rubbish and worse—as a well-brought-up young woman, I would not wish to embarrass the House with a more detailed description, but it is extremely offensive for the farmers and very costly to clean up.
Before November 1994, it was up to the individual to get rid of travellers. Now, however, as a result of years of complaint, such trespassing has been recognised as a criminal offence under section 61 of the Criminal Justice and Public Order Act. The police have been given discretionary powers to direct trespassers to leave land in cases where there are more than six vehicles or where there has been threatening or abusive behaviour. If the travellers fail to comply, they can be arrested and their vehicles and animals seized.
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The problem is that in our part of Essex and East Anglia that does not appear to be happening. There are two sites in Thurrock where travellers can go, and we do not want a third. We have appealed, and the matter is being dealt with by the Department of the Environment. We do not want another site, because the people behave so appallingly. They are not even acceptable on the sites that have been made available for them because their standard of behaviour and conduct is so bad.
There has been very little diminution in the number of travellers in our part of the world. For example, in 1994 686 cases were reported. In January 1995—a year on—the figure had gone down by only a handful to 665 cases. On eight separate occasions this year, farmers in my region have asked the police to take action against the gipsies, as it is within their power to do, but the police have failed to do anything. Even Thurrock council, which is rather friendly to such people, has said that it is not prepared to try to get rid of the unauthorised campers. Some of the invasions have taken place on council land.
Those events precede the peak season for itinerants. They travel from southern Ireland, in particular, and spend their summer holidays visiting the tips in Essex. They collect and sort garbage and leave the detritus behind them on the fields. Essex is invaded by travellers in the summer, and we fear that the police may continue to refuse to deal with the problem.
I know that the matter would be addressed more appropriately to the Home Office than to my hon. Friend the Under-Secretary of State for the Environment, but I will come to that point in a moment. There are two existing sites in my constituency for travellers. There are vacancies on those sites and they could apply to stay there. Thurrock council has provided quite good quality accommodation on the sites, but they are not acceptable to the travellers.
There is no evidence that providing a third site will have any impact on the current desperate situation. I therefore urge my hon. Friend not to follow that route. There is no truth in the theory that the more sites one provides the fewer problems there will be. It does not work like that. The travellers are so undisciplined and inconsiderate of everyone but themselves that they simply will not use the site. We therefore do not want to see another site established at Gammon field.
I believe that the argument that travellers should not be moved to those sites is redundant. The travellers are simply not acceptable—not even to Thurrock council, which I believe is over-friendly to itinerants. [Interruption.] The hon. Member for Thurrock (Mr. Mackinlay) interrupts from a sedentary position. He supports the local Labour-controlled council, which we regard as one of the last outposts of Stalinism in our part of the world. It adopts an extremely soft attitude to people who appear to have no assets, which is not in tune with that of the majority of my constituents or of the hon. Gentleman.
I will outline two cases involving travellers. On 16 May, Mr. Robert Cole's farm was set upon by scavengers. The police were asked to take action, but they decided to do nothing. Mr. Cole had to resort to the legal system and, as a consequence, incurred a solicitor's fee, a process server's fee, a court issue fee, a commissioner's fee and a fee for the bailiffs, which came to a total of £500. The trespassers moved on only when the bailiffs moved in and

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told them that the police would eventually be coming around. Quicker action by the police would have avoided wasting a great deal of Mr. Cole's time and money.
The travellers had left a great deal of rubbish behind and it cost £250 to clear the field. Those people are positively uncivilised in the way in which they move on and leave their garbage behind them. They do not even put it into black sacks; they simply leave their rubbish, including rented gas cylinders which they use to provide heating and lighting for their caravans, all over the field. Before the poor old farmer can milk his cows, shear his sheep, sow his corn or reap his barley, he must clear up the fields after those people.
Mr. Christopher Gill: Should we not ask the Minister why the people to whom my hon. Friend refers should be allowed to cause such extreme discomfort and aggravation to law-abiding citizens through their totally anti-social activities, which seem to enjoy more protection under the law than the bona fide law-abiding citizens who are affected by them? Should not the Minister address that issue? Were we not all led to believe that the Criminal Justice and Public Order Act 1994 would help us to solve that problem?
Mrs. Gorman: I agree with every word that my hon. Friend has said. I know that he encounters such problems, because he represents a rural area. I give the Government credit for introducing the measure as part of the Criminal Justice and Public Order Act 1994, but in many parts of the country it is not being implemented.
Another farmer in my constituency, Mr. Cooper, watched 24 caravans arrive at his farm in Cookoo lane. The police were asked to intervene, but again they were prepared to do nothing. As the powers are not mandatory, the police can choose whether or not to implement them. After the usual legal wrangling to get rid of the caravans, Mr. Cooper was left with a bill for £2,000 as 200 tonnes of rubbish had been left on his field. That is a perfect disgrace, not just for the farmer, but for those who live in the area.
Last Sunday, the travellers returned with their caravans and entered the land by force. Mr. Cooper had parked a large heavy cultivator across the entrance to the field so they broke in, which is another offence, and the farmer was once again left to phone the police, who were unwilling to deal with the matter. He spoke to the travellers, but he might just as well have been talking to wind as they were not interested until today, when he got a bailiff to talk to them.
We are discussing two issues. First, is there any sense in providing more sites for such people? I entirely disagree with that, as they are so badly behaved that they cannot even get on to the sites. The second issue involves the attitude of the police. That is a delicate problem, because the police naturally do not want to cause themselves more trouble if the travellers become stroppy and difficult, but I maintain that we have to be absolutely firm. The Government provided the power because it was such a popular measure.
Mr. Eric Pickles: My hon. Friend will recall that the amendment to the law was intended to give private landowners the same rights as councils, which have enormous resources, to move travellers on. The decision of the police not to enforce the
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law returns private landowners to their position before the law was amended, so we might just as well not have amended it.
Mrs. Gorman: I entirely support what hon. Friend has said. That is exactly the position of farmers in my constituency.
I have it on the highest authority that the Association of Chief Police Officers is advising local forces in my area that action should be considered only in exceptional circumstances and that there is an expectation that all other remedies will have been tried before the police are prepared to intervene. As my hon. Friend has just said, that was exactly the position of farmers before the legislation.
The police seem unwilling to get involved, at least in East Anglia and Essex. The local National Farmers Union met the police in East Anglia, who made it clear that police forces intended using their discretionary powers only as the last resort, which I believe to be a negation of the Government's intention in giving them the power. The chief constable in Essex said, "We have to cover Brightlingsea and we have to send policemen to deal with the animal rights protestors." That is not good enough. The police were given that power and they should be using their manpower to help the farmers. If we had one or two good cases, the itinerants would go somewhere else; they might even, for a change, decide to behave like law-abiding citizens, although that would be a small miracle.
The NFU senior technical adviser said:
"I suspect that farmers and landowners will still be left to bear the brunt of the cost, time and stress involved in removing squatters from farmland through the Courts."
That is not acceptable and I invite my hon. Friend the Minister to comment on it in his reply to the debate.
The news is not all bad. In some parts of the country, the police are taking up the authority which has been given to them. I am told that, in the Metropolitan area, Sir Paul Condon, the Metropolitan police commissioner, has set out a plan of action and a clear procedure so that farmers and landowners know exactly which button to push when the problem hits them. They have a sort of ARP notice—those of us old enough to remember the war will know that it stands for "air raid precaution"—to pin up in their barns, outlining the stages to go through and the police officers to call. Sir Paul has said explicitly that he is determined to see that the unauthorised vehicles and animals that these people bring on to land are removed. He is also insisting that local councils co-operate in their part of the job when the vehicles and animals are taken into custody. Obviously, they have to go somewhere.
Co-operation is therefore possible, but I am assured by many of my colleagues with rural constituencies that what they all hoped would be a happy ending to the problem is not materialising—certainly not in our part of the world. I should like all chief officers to do as the Metropolitan police have done and assure farmers that they will never again need to act alone. They must have the sort of back-up that Sir Paul Condon is advocating in the Metropolitan area.
We need more guidelines from the Home Office or the Department of the Environment. Although most of my complaint is directed at the lack of police activity in my area, I assure my hon. Friend the Minister that allowing more official sites to come on stream will not cure the

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problem. We need more action on the part of the Government. I ask the Minister to try to give some idea to my farmers, and to those in other parts of the country, that the Government are determined to ensure that the powers that they have enacted and which are available to control this menace will be put into action.
Unless that happens, these people will pour into the country seasonally, acting like mobile totters—like Steptoe characters, picking over rubbish or offering their services to put down tarmac on drives. When they do that, they dump all the rubbish taken from people's drives on some hapless farmer's field. These people must be dealt with and made to act within the law of the land.
10.32 pm
The Parliamentary Under-Secretary of State for the Environment (Mr. Robert B. Jones): I congratulate my hon. Friend the Member for Billericay (Mrs. Gorman) on securing this debate. I am also delighted to see in his place my hon. Friend the Member for Brentwood and Ongar (Mr. Pickles), who has tirelessly campaigned for his constituents on this and other issues.
My hon. Friend the Member for Billericay is concerned about instances where the police have not exercised their powers under the Criminal Justice and Public Order Act 1994 to deal with trespassers residing on land. I should make it clear at the outset that the enforcement of the law and the making of arrests are entirely operational matters for chief officers of police. They are not matters in which Ministers can intervene. However, what I can do is to explain to my hon. Friend and to the House what the relevant provisions of the Act can do.
Section 61 of the Act strengthens previous police powers to deal with trespass on land, and further assists the police in protecting landowners and local communities which suffer so badly from incursions on to land. It provides the police with a discretionary power to direct trespassers to leave land in certain circumstances.
The Act retains the requirement for the occupier to have taken reasonable steps to ask the trespassers to leave the land before the police may consider whether or not to use their powers. In addition, the section retains the safeguards that the police may direct some, and not necessarily all, the trespassers at a particular location to leave. The police therefore have the discretion to remove only those trespassers who are causing trouble, and equally, to allow those with pressing health or welfare needs to remain.
Police powers to deal with trespass are, rightly, limited to circumstances where public order problems might arise. The majority of trespass cases will continue to be dealt with by civil law procedures.
Of course, where landowners take action by this means, and where it is then necessary to serve court papers on trespassers, the police should be notified so that they can provide a presence to prevent breaches of the peace.
My hon. Friend will also be aware of new powers available to local authorities under sections 77 to 79 of the 1994 Act, to direct unauthorised campers to leave land where they are parked without permission. A direction can be issued immediately and without reference to the courts. If persons so directed do not leave the land in response to such a direction, or if they return to the same land with a
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vehicle within three months of the date of the direction, they commit an offence subject to a maximum fine of £1,000.
It is open to any private landowner to ask his local authority to use its powers of direction. We have issued a circular, No. 18/94, entitled "Gypsy Sites Policy and Unauthorised Camping", to local authorities. It gives guidance on the scope and use of the new powers. We have made it clear that we envisage local authorities using the powers primarily to protect private landowners plagued with the nuisance of unauthorised camping. I should, however, emphasise that the powers are, like those available to the police, discretionary. It is for the relevant local authority to judge whether, in all the circumstances, use of the powers is justified.
My hon. Friend has made criticisms of the local authorities and the police. If she has not already done so, I hope that she will arrange to discuss these matters directly with the police in Essex and with the local authority in Thurrock. As she has said, these matters are outside the Department of the Environment's responsibilities by and large. They are matters that she should pursue with my right hon. and hon. Friends at the Home Office if necessary.
As for the proposed gipsy site at Gammon field, my hon. Friend has expressed concern at the decision of Thurrock borough council to press ahead with it. The council has taken the decision despite the repeal of the duty on local authorities to provide sites and of the power to pay gipsy site grant.
The position is that Thurrock borough council applied in 1992 for outline planning permission to provide a site of 21 pitches at Gammon field. The decision had been made after an extensive search for a suitable site over a number of years to provide for the demand from gipsies in the district, some of whom were encamped on sites without planning permission. There were a number of objections to the chosen site, on the basis that it was in the green belt. The planning application became the subject of a public inquiry in April 1993, at which I believe my hon. Friend gave evidence.
I can reassure my hon. Friend that the full and proper process of public consultation and debate over the provision of the site was followed. In considering the proposal, my right hon. Friend the Secretary of State had particular regard to the following issues: the relationship of the proposal to policies contained with the Essex structure plan and deposited Thurrock borough local plan; the suitability of Gammon field for a gipsy site, having regard to its location within the metropolitan green belt and a landscape improvement area; the need for a further gipsy caravan site within the borough of Thurrock; the availability of alternative sites for the proposed development; the likely impact of the proposed development on the appearance and character of the area, and the amenity of local residents; and the effect of the proposals on the local highway network and, in particular, the adequacy of measures to control access to the site.
After giving careful consideration to a new scheme for access to the site submitted to the council in February 1994, about which my right hon. Friend and other parties to the public inquiry were consulted, my right hon. Friend the Secretary of State was also satisfied that the highway safety objections which concerned the inspector could also be overcome, so in August 1994, he granted planning permission to Thurrock borough council. As my hon.

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Friend will know, once the Secretary of State has issued his decision on a planning application, his jurisdiction in the matter is at an end.
Subject to the granting of planning permission, the authority submitted a valid grant application to my Department in October 1994. My hon. Friend will appreciate that I am bound to consider any grant application which was submitted to the Secretary of State before 3 November 1994, the date of repeal of his power to pay gipsy site grant under section 80 of the 1994 Act. The application from Thurrock borough council falls into that category, and the local authority thus has a legitimate expectation that its application will be considered.
I cannot comment on the merits of this proposal, as the formal grant application is still being considered. My hon. Friend can be assured, however, that I shall consider all remaining grant applications, including the one for Gammon field, very carefully against our criteria of need, value for money and comparability with the works cost benchmark, before deciding whether approval is justified. In Essex, the benchmark is £27,000 per pitch, and we would need to be convincingly persuaded to agree any higher figure.
The Caravan Sites Act 1968 gave county councils a duty to provide authorised sites for gipsies, in the hope that it would control unauthorised camping. Generous Government grant has been made available to authorities to assist them to tackle the problems of unauthorised gipsy camping. Locally, there have been successes. In Essex, many sites have become accepted and integrated into local communities, even where existing residents had doubts. The development of official sites has also led to a great reduction in the number of unsightly roadside encampments.
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There are a good many gipsy families throughout the country who are keen to make their own site arrangements, and the Department has issued planning guidance to show how that can be achieved within the existing planning framework. We have encouraged local authorities to consider gipsy families' needs within their development plans. Indeed, whether or not a county or district council decides to proceed with the provision of a gipsy site, the planning guidance to which I have referred allows that private sites may well be admissible within the current planning system, and we would expect local development plans to reflect that.
I am also aware that my hon. Friend has written to my hon. Friend the Under-Secretary of State in my Department concerning gipsies who have purchased land at Crays hill, Basildon, and sited caravans there. I understand that 17 plots have received planning permission, eight as a result of appeals against enforcement action dating from November 1992.
However, I hope that my hon. Friend will take comfort from what I have said, in connection with the Gammon field site and its location in the green belt, in that planning guidance on gipsy sites has been revised in circular 1/94. That policy, together with the new eviction powers contained in the Criminal Justice and Public Order Act 1994 should, as I am sure my hon. Friend and her constituents will recognise, significantly curb the number of unsightly and disruptive occurrences of unauthorised camping.
I hope that what I have been able to say in explaining the position will be helpful to my hon. Friend. I am grateful to her for drawing the subject to the attention of the House.
Question put and agreed to.
Adjourned accordingly at nineteen minutes to Eleven o'clock.