British Council

HC Deb 01 May 1996 vol 276 cc1081-102

11 am

Mr. Robert Litherland (Manchester, Central)

I am delighted but saddened to have the opportunity to highlight the impact of the £22 million cut over the next three years on the British Council and its role as our principal agency for cultural relations abroad and in our aid programmes and diplomacy. The council's future has been undermined and jeopardised by the cuts. The Government know that full well, because the council has emphasised its difficulties in meeting the costs of restructuring to come to terms with the demands placed upon it by the swingeing cuts.

The council does not have access to capital to fund the restructuring that will be forced upon it to implement the cuts. It is a Catch-22 situation. The planned reduction in the British Council's grant and the enforced restructuring have not been thought through. It is another victim of ill-conceived Treasury policy and of what the Secretary of State described to me in his letter as the recent very tough spending round which has reduced the Foreign and Commonwealth Office budget. That is it in a nutshell. The council is a victim of public expenditure restraints, no matter how valued is its work. Dr. Roger Bowers, its Manchester assistant director general, informs me that its long-term commitment depends on whether there is any further significant change in the Government's financial support. My advice to him is not to hold his breath. We cannot rely on a Government that can impose such unexpected cuts without considering the effects on the service and especially on the efficient and dedicated staff. We cannot rely on a Secretary of State who, in a two-line sentence, informs me: We will do our best to help the council next year but that must depend upon the outcome of the next spending round. Those comments do not sound reassuring to me and I do not think that they will reassure management and staff.

I am assured by the British Council that it has a good efficiency record. It was on target to reduce its UK overheads and was restructuring its regional offices, producing savings and exceeding Treasury targets for efficiency savings. It had cut staff over three years by 25 per cent., so it had played its part. Regrettably, that could not satisfy a Government hellbent on cutting public expenditure. Where better to do that than with an organisation that, in spite of its excellent activities, is little known domestically?

The ordinary voter knows little or nothing of the work of the British Council. Such savage cuts would not be a vote loser. How many people realise that the British Council promotes British interests abroad through many and varied channels? How many know about its management of overseas development projects, its promotion of the English language, its vital partnership links or its involvement with education and training, science and technology and the promotion of British arts? How many know how that work has benefited millions over the past 60 years? So what? It is not a vote loser. Nobody on the domestic front will miss it, so who cares?

There are many who care and who are anxious to make their concern known. This debate has generated a great deal of interest in what is happening to the British Council and where its future lies. I know that other right hon. and hon. Members wish to speak who have taken a long-term interest in its activities and followed recent events with great concern. They are far more knowledgeable than I about the details of its crucial role in world affairs.

I regret that other interested Members such as me were not contacted earlier. Neither I, as Member for Manchester, Central where the council is sited, nor my hon. Friend the Member for Stretford (Mr. Lloyd) who represents the adjoining constituency and who is a Front-Bench spokesperson on foreign affairs, were aware of the extreme difficulties facing the council until a few short weeks ago when we received a two-sided A4 sheet from the Public Services, Tax and Commerce Union.

Several hon. Members were disturbed by the lack of communication between the British Council and Back-Bench Members. There appears to have been an air of secrecy and a softly, softly approach to its impending doom. Do not rock the boat; be nice to the Government—as if that course of action would make any difference. It was not until my hon. Friend the Member for Dundee, West (Mr. Ross), in his role as chair of the parliamentary Labour party foreign affairs departmental committee, invited officers such as the council's director general, Sir John Hanson, and Dr. Roger Bowers to our meeting that we realised its predicament. That meeting took place only four or five weeks ago. The cuts will damage the work of council in general but will have a detrimental effect on Manchester in particular.

On hearing of the fate of Manchester, my mind went back to a lovely summer's day in July 1992. Manchester was agog and there was an air of excitement and eager anticipation. Her Majesty the Queen was visiting the city. The crowds and the children turned out to offer the usual warm Manchester welcome. The Queen was there for a dual purpose. She had come to open the prestigious new British Council building to which its headquarters had relocated. She followed that opening ceremony by declaring the new metrolink tramway open. It was a day of achievement for the city and its citizens. The metrolink is still running; it has proved to be a huge success. However, the same cannot be said for the British Council, for what a sad, sorry story that has turned out to be.

Who would have thought that, only four short years from that July day in 1992, the British Council would face such a situation? It is four years since Her Majesty paid tribute to the building's architectural merit and admired the internal decoration, the new carpets and the unique wall-mounted clock. It is three years since it won the office of the year award, but that building will no longer serve the purpose for which it was intended. The building was a vital part of the jigsaw of our regeneration programme and the British Council's coming to Manchester was part of the process of urban development that we were trying to achieve. What we had envisaged as a success story is now in a state of collapse. After the depletion of our manufacturing base, we welcomed the new service industries that brought jobs to Manchester. Where do we go now?

It does not take a genius to work out that enforced redundancies—about 180 people are to lose their jobs in the current financial year—and staff being moved elsewhere means that the British Council will have to seek alternative accommodation. I am informed that it is exploring all options for possible new tenants and a new home for itself. Although we hear the mutterings of management, who say that they are committed to staying in Manchester, I am sceptical of what they really mean—the city of Manchester or Greater Manchester. A new venue of Salford quays has been mooted, but Salford is a neighbouring authority. The British Council would be moving away from the city itself if it takes that decision.

I appreciate that the management are expressing regret that the reductions are taking place so soon after the official opening, especially when the council's work is most needed, but it is the staff of the British Council who concern me.

I recently received a letter from an employee, who told me that, as the letter was being written, the family were still in the throes of upheaval after relocation and were surrounded by cardboard boxes waiting to be unpacked. The family had faced the trauma of upheaval in leaving their home down south to move to Manchester, where the spouse had acquired a part-time job. The children had been placed in a new school, made new friends, and the family had made a new life. They informed me that they liked their environment and did not want to move on. Yet they could find themselves left high and dry without a livelihood, far from their relatives and friends who remain in the south of England. The Secretary of State has an obligation to offer a full explanation to such people of how they will be assisted and compensated for such loss.

The worry is that the cost of restructuring will be extremely high. The estimated cost of redundancies, based on previous redundancy programmes, is in the region of £12.6 million. With additional costs, a total restructuring cost of £17 million is estimated. If the Government will not meet those costs, will the council face insolvency? The council emphasises that it has no means of funding such costs unless it does not carry out its operational work for at least a year. Can anybody imagine that? It would seriously discredit the Government, their foreign policy and this country.

Where do the staff stand in such a scenario? Close to £15 million was spent on relocation, and a plan to save costs by going to Manchester was devised. What happened to all those carefully thought-out schemes? Why did the Foreign and Commonwealth Office allow the British Council to go ahead with its decision to restructure when it must have been aware that the Treasury intended to impose such draconian cuts? It must have known the effects that such cuts would have on the council's operations and staff.

The council is in an impossible position. There is no scope for savings of such magnitude. How can it maintain its present global coverage under such demanding financial guidelines? The short answer is that it cannot. The scale of cuts has crippled the organisation and there are grave doubts that it can carry on and meet the stated objectives of Britain's foreign policy for the 21st century. It is ironic that the 1992 Conservative party manifesto said: The British Council acts as a cultural ambassador for Britain and for the English language—We will promote the English language by strengthening both the British Council and the BBC World Service". Strengthen indeed! The Government should tell that to the family surrounded by unpacked cardboard boxes and with no future to look forward to.

If it is the intention to save the British Council's frontline operations at the expense of UK operations—the management are looking for a £5.5 million reduction in the UK—we can expect more families to meet the same fate of the family that I have described. What a peculiar way to treat staff of an organisation that has fulfilled all its obligations and has been described by the Secretary of State as dedicated and one that has made an outstanding contribution. I am always cynical of the Government. Perhaps their aim is to undermine the viability of the British Council and make room for the private sector, which we know is watching events with interest and would quickly cream off the most lucrative commercial operations if it were allowed.

I picked up two articles on the subject recently. A letter in The Economist said: The most drastic solution would be to privatise the council's commercial activities and restrict it to promoting the interests of all British providers of such services. The Times Higher Educational Supplement said: What the Government refuses to accept is that this structure undermines its stated belief in market forces, the private sector and the discipline of competition. My, my, the private sector is now telling the Government their obligations to the private sector.

I was delighted that Sir John Hanson, the council's director general, dismissed the complaints. He was reported as pointing out: the council still farms out many of the contracts it wins to other British suppliers, rather than doing the work itself. But he believes British firms would not win so much work if the council did not run its own language schools and consultancy projects, as showcases for Britain's skills. As we all know, privatisation has always been the Government's panacea to all the country's ills. They would forsake all for their ideology. I sincerely hope that in this special case, the Government will have a serious rethink. The British Council, its staff and Manchester deserve better.

11.17 am

Mr. Tim Renton (Mid-Sussex)

I congratulate the hon. Member for Manchester, Central (Mr. Litherland) on securing this Adjournment debate on the British Council. I share many of his concerns about the British Council. He has represented a Manchester constituency over the years, so I appreciate his strength of feeling on behalf of British Council employees in Manchester, which he so vividly expressed.

I do not at all agree with the hon. Member that the British Council is—I think that I am quoting him correctly—in "a state of collapse". I do agree, however, that there is very widespread concern at all levels in the council about precisely where its future will be. I state that as an unpaid vice-chairman of the British Council—an interest that has regularly been declared in the Register of Members' Interests. I have had the honour and good fortune to hold that post for nearly four years, and during that time, two themes have dominated our board meetings and all the contacts that I have had with British Council staff in London, Manchester and abroad.

The first theme is simply the relentless pursuit of better housekeeping, through greater cost-effectiveness, more modern accounting and a better use of information technology. The move from London to Manchester was one aspect of that, and was intended to save substantially on salaries and associated expenses in the United Kingdom.

The hon. Member for Manchester, Central has stated that there has been a substantial reduction in UK staff in the past four years, before any consideration is made of the effect of the new grant in aid proposals. We have recently sold or let half the headquarters building near Trafalgar square to bring United Kingdom costs down.

The other—and more positive and exciting—side of our affairs has been the careful expansion of British Council posts in, for example, eastern Europe and the former Soviet Union, and the re-opening of posts in Shanghai and Beijing. These can help us take advantage—usually on a fee-earning basis—of the enormous opportunities for all aspects of English language teaching, training and technical co-operation in the contracts that are now available to the British Council, often on a competitive basis. We must fight to provide ELT services against competition from Australia and the USA, and we must fight to win technical co-operation contracts with the Overseas Development Administration, the World bank and the European bank of reconstruction and development.

In the past three or four years, I have heard the British Council praised and encouraged by the Prince of Wales, the Prime Minister, successive Foreign Secretaries and countless ambassadors, both abroad and at home in London. It is worth pausing to think that, on a rough calculation, there are something like 1 billion people in the world at the moment who want to learn English. English is now by far and away Britain's most valuable export. It is the universal second language, the language of computer-speak and the language that almost all professionals use in discussing technicalities through the Internet. To the chagrin of the French, English is now the language of diplomacy. In a euphoric mood, I could say that every one of those billion people—or their teachers—is in some way a potential client of the British Council.

I am delighted to add that the revenue earned by the British Council from its activities is increasing. The amount was £62 million in 1990–91 and increased to £115 million in 1994–95. It is estimated to increase further to £130 million in the year that has just ended.

I wish to refer for a moment to China. I visited the British Council's offices in Shanghai and Beijing after going to Hong Kong in October. No one can go there and not be amazed at the potential for opportunity. After all, it is a country with 1.2 billion people, and its GNP is growing at a rate of 10 to 12 per cent. a year. It has more than 1,000 universities. English is now the official second language for everyone aged nine upwards until they finish their education. That is against the background of the fact that more than 90 per cent. of students do not have any English language teachers because they do not exist. The scope for an organisation like the British Council to team up with the Chinese open university, the BBC or David Puttnam to provide distance learning in English and to train and teach people up to the professional standard for English teaching is absolutely huge.

Even if some of the British Council's activities become fee-earning, they need seedcorn capital to get started. As the hon. Member for Manchester, Central said, the British Council's activities are often not recognised in this country because we do not trumpet them around the United Kingdom enough. The council is helping to win for Britain its present market share in the global education and training export business. This is estimated by the Department of Trade and Industry—not by the council— to be worth some £7 billion a year. The council's education and counselling service operates in 10 key markets in the far east and, through our education fares, exhibitions and face-to-face advice to students, the service is contributing to increasing the number of overseas students in Britain to beyond the level it was when full costs for fees were introduced. I simply do not believe that that would have happened without the British Council.

The council is involved not only in higher education, but in the promotion of United Kingdom education at all levels. I attended an education seminar over lunch in the Jubilee Room on Monday, which was aimed by schools, universities and colleges of technology in Sussex at overseas students. Without my proclaiming that I was the vice-chairman of the British Council, strong credit at that meeting was given to the council for its work.

My right hon. Friend the Minister is well aware that the council's overseas offices depend for their viability on a fixed bunch of activities. It is not possible to say to any of them that they should concentrate on revenue-earning activities because such activities are not yet of a sufficient size to enable the posts abroad to be viable and to justify themselves. Such a demand would totally ignore the original aims of the British Council—the promoting of British art, culture, books and music abroad. The other side of our activities brings in a good many people into our posts, but the availability of libraries and information centres about Britain and the sponsoring of art and culture tours abroad are not necessarily financially viable.

Continued grant in aid is necessary to keep the whole plethora of council activities going. Without grant in aid, many British Council overseas posts will simply have to close, as they will be unable to expand their revenue activities quickly enough. Against that background, I find it hard to believe that the Government will wish to force the British Council—that jewel in the crown for marketing Britain abroad—will wish to force us into the closure of libraries or overseas posts. I must say, however, that the present forecast for grant in aid for the British Council would have exactly that effect.

The sums needed to prevent this are not large. The British Council would certainly need assistance with the cost of redundancies at home in which we are now bound to be involved. Beyond that, we have spoken of the restoration of some £5 million grant in aid in 1997–98, and £10 million each year thereafter to avoid the closure of posts. Frankly, that would run wholly contrary to the Government's policy of support for the British Council and the better presentation and marketing of contemporary Britain, its education, IT and modern technology abroad in which the British Council excels

I know that the board, senior management and staff of the British Council very much hope to hear some good news from my right hon. Friend the Minister—if not today, then next week. Many important people have told me recently in relation to the British Council that they are on our side—they are with the angels on this. That is very nice, but frankly being with the angels at the moment is not enough. They will have to have clutched between their wings some rehabilitation and improvement of our grant in aid if we are to avoid the closure of overseas posts, libraries and information centres. Everyone in the House would greatly regret that.

Several hon. Members

rose—

Madam Deputy Speaker (Dame Janet Fookes)

Order. There is clearly great interest in the debate, so I hope that in the short time remaining those hon. Members who wish to speak will make their contributions as brief as possible.

11.29 am

Mr. Tam Dalyell (Linlithgow)

I shall be brief.

The British Council is central, not peripheral, to the orientation of Britain's foreign policy. It is not on the margin. Therefore, I simply ask: what is the Government's thinking on the British Council's position in the resources queue?

The right hon. Member for Mid-Sussex (Mr. Renton) has just reminded us that the British Council is a significant earner. The figure that we have been given, as he will know from the board, is £130 million. That could go up and up over a period of years for the very reasons that he has given. There is a huge market for educational training, and the British Council has a key role in the British economy.

I take just one example. I was lucky enough to be selected for the recent Inter-Parliamentary Union delegation to Nepal, which was led by the Secretary of State for Northern Ireland. The right hon. and learned Gentleman and I went to see the Minister for Overseas Development about the British Council in Kathmandu and how possible cuts might affect it. I can only say, without being maudlin, that it was a moving experience to see people from Nepal who, frankly, have no other decent library, streaming into the offices of that well and imaginatively run British Council post in order to enlarge their knowledge.

Doubtless colleagues could repeat such experiences from many parts of the world; I can talk only about that recent experience. To see the amount of service that was being given to that country, one of the poorest countries in the world on any index, really did make one feel rather proud to be British. Of course, a great deal more could be done. Certainly in Nepal, more could be done by distance learning in areas where, because of the terrain, it is difficult to get children to any kind of central primary school. The possibilities of distance learning there are immense, and the British Council is the body to do that.

Therefore, if we are to talk meaningfully about overseas aid and the help that we give to developing countries, the British Council and its capacities and skills in areas such as distance learning are of enormous importance.

You, Madam Deputy Speaker, asked us to be brief and we want to hear the Minister, so I end with these two questions. Where is the British Council in the resourcing queue? Do the Government take the view, as many of us do, that it is not only morally right in many countries to support the British Council. but in the British national interest? I shall leave it at that.

11.32 am

Sir Jim Lester (Broxtowe)

It is a delight to follow the hon. Member for Linlithgow (Mr. Dalyell). I agree with every word that he has just said.

I recognise that the public in general do not know about the British Council. But I speak as a member of the Select Committee on Foreign Affairs since 1982–14 years' experience of looking at the British Council as part of the Select Committee's responsibility to consider foreign policy. That is why I want to speak today, and I just want to say three things.

First, the credit for the figures that I am about to quote rests with my hon. Friend the Member for Carshalton and Wallington (Mr. Forman) in his Macleod essay entitled "No Hiding Place: British economic policy in the modern world". That is the context in which things should be placed.

Britain consistently punches above its weight. The figures in the essay show that Britain has only 1 per cent. of the world's population, but 3.5 per cent. of its gross domestic product. Since 1979, Britain's overall international trading position has changed from 20 per cent. for exports and 27 per cent. for imports in 1979 to 23 per cent. for exports and 25 per cent. for imports in 1994. Our exports of goods and services at constant 1990 prices have risen from 22 per cent. of GDP in 1979 to 27 per cent. in 1994. Those are critical figures in terms of Britain's economic place in a new world with a global economy, and they are good figures.

We know that, diplomatically and politically, we punch above our weight. Britain is a tiny country, which is a member of the Commonwealth, the United Nations Security Council and all the rest. I shall not rehearse the details because I think that we all accept that; Britain punches above its weight, economically, politically and diplomatically. Part of the reason for that is that, in the years since 1979, the Foreign Office has targeted the improvement of its performance.

The Select Committee is now committed to producing a report on cultural diplomacy and it has shown that that plays a vital part in Britain's export efforts and capacity to work in the world. The term "cultural diplomacy" had not been thought of before the Select Committee considered it, but the two essential elements of cultural diplomacy are the BBC World Service and the British Council. The Select Committee's most recent report on the future of the Commonwealth comes back again to that question and gives tremendous support to the British Council and the role that it plays.

We are a member of the European Union, with an economic base that enables us, through the Commonwealth and the rest of the world, to look ahead to a prosperous future. I come here to the point made by the hon. Member for Linlithgow, which is the second thing that I wanted to say. Obviously, British policy must be to expand and to continue to punch above our weight in the world, but on what basis should we evaluate the things that are vital in terms of achieving that objective? The Government have no way of determining whether something is a real benefit that should be backed and on which extra money should be spent because it is good.

The English language, as my right hon. Friend the Member for Mid-Sussex (Mr. Renton) has just suggested. is one of those things, as is the British Council. The Foreign Office comes into the same category. I wish that we had a Treasury Minister on the Front Bench rather than my right hon. Friend the Minister of State, because for the Foreign Office, which does such magnificent work overseas, to be spending less than 1 per cent. of our gross public expenditure and achieving so much for it, yet to be subject to regular miserable chippy-chippy cuts that result in what has happened to the British Council, is absolutely crazy. By spending very little money. we could achieve even better figures than those that 1 have put forward.

I work closely with my old university, and my right hon. Friend the Member for Mid-Sussex mentioned education. Britain attracts 250,000 students at a value of about £2 billion to our economy through the joint operation of universities and the British Council. The Americans, with their great country, attract only 450,000. Again, we punch above our weight and we are attractive because of our language and standards and because of the high regard in which people hold what Britain has to offer.

We must have a system of government that evaluates the purpose and the value to Britain of the British Council's budget and, therefore, backs winners rather than chopping things that clearly have an enormous benefit, particularly when we are talking about piddling amounts of money. Bovine spongiform encephalopathy is serious and suddenly a lot of money has been found for the farmers. The British Council needs only a fraction of that.

My third point concerns the way in which things are done. Great institutions such as the British Council cannot suddenly make reductions in their costs without facing what I call double jeopardy. People have to be made redundant, so the cost of redundancy must be added to the amount of money that has to be found. That is double jeopardy because money is being wasted in order to get rid of people, particularly people overseas who have often been devoted servants of Britain, working for the British Council. They require some notice in their own interests, because they have no fallback in terms of social security in many of the countries in which they work. That operation has been very badly handled, and leaves the British Council in limbo because of double jeopardy.

The hon. Member for Manchester, Central (Mr. Litherland) suggested that people do not know much about the British Council. Last Wednesday, the Foreign Affairs Select Committee had before it Sir Martin Jacomb and Sir John Hanson to press all those points. The hearing was televised, although I suspect that it was not shown on any television channels. Nevertheless, the transcript of that meeting is available.

I should like to quote from the hearing a question—naturally from me—in which I said that the council was strongly backed by the members of the Committee. As my right hon. Friend the Member for Mid-Sussex said, we had been talking to the right people and received warm words and suggestions that action might be taken. I asked Sir Martin: Are they really taking your concerns seriously? Can you give us some idea of the timescale in which you would want an assurance on which you can work before you actually have to take the sort of decisions, which you are obviously working on, which you feel would be very damaging to your future? Sir Martin replied: The fact is we are already really in extra time. We have been talking about this since last November, which is nearly five months, and still there is no assurance of money. If there is to be no alleviation and we have to make reductions, particularly reductions abroad, to handle that sensibly and sensitively and in such a way as to secure the minimum damage to this country, action has to be taken now. That is a very profound statement from someone who has devotedly worked with the British Council.

The impact of the cuts is completely out of proportion to the amount of money that we are talking about. I beg my right hon. Friend the Minister, and any other right hon. Friend who can help, to grasp the nettle, turn round the situation and give a positive assurance—which has money at the end of it—to bring this unfortunate saga to an end.

11.41 am

Miss Emma Nicholson (Torridge and West Devon)

I congratulate the hon. Member for Manchester, Central (Mr. Litherland) on ensuring that this important subject is being debated at all. It is a pleasure to follow the hon. Member for Linlithgow (Mr. Dalyell) and to listen to the vice-chairman of the British Council, the right hon. Member for Mid-Sussex (Mr. Renton), who said that he was speaking with some euphoria when he reeled off credit upon credit for the British Council.

All of us could list the council's credits, because it is a most remarkable organisation—but the right hon. Member for Mid-Sussex perhaps ducked the issue at the end of his speech. Surely he cannot be in favour of the disastrous—or near-disastrous—cuts to the British Council, because a 16 per cent. cut in real terms will surely most seriously threaten its capacity to maintain an effective presence internationally and its programme in regions that are important to British interests.

The council operates in 109 countries, and, as we all know, it is currently the only Government organisation that sustains and promotes British culture. We know that the British Government will not rejoin the United Nations Educational, Scientific and Cultural Organisation, so we must rely for the promotion of the English language and British culture wholly on the British Council.

I am unclear why the Government wish to impose on the British Council this serious public expenditure cut of 16 per cent. in real terms. Surely we are correct in saying today, as the vice-chairman has already said, that there has been immense praise for the British Council, even from a former Foreign Secretary and from the current Foreign Secretary.

In his letter about the cuts to the council's chairman, the Foreign Secretary stated that the reductions did not mean that he did not appreciate the outstanding contribution that the council makes to the UK's overall diplomatic effort. He also acknowledged that the council had done a great deal to improve efficiency by rationalising its UK network and reducing overheads", and that the council was extremely leanly staffed.

The Foreign Secretary went on to ask again for the impossible. He said that he nevertheless hoped that it would be possible for the council to continue to maintain a global network and to avoid significant post closures. Of course, those two objectives just do not match up.

I understand that the council has only one way in which to meet the new grant in aid regulations, which will be a significant reduction in its staffing levels, with higher proportions of cuts in the UK. The saddest aspect of those cuts is that the British Council is a people-led organisation. How can we imagine that the skills of those whom the British Council will be forced to shed are replaceable in the short term? We know that it takes a lifetime to learn the language and culture of a country. It is a lifetime skill. I believe that British Council staff have been vastly underrated by the Government, and I am sad that those magnificent and skilled people will be lost in helping to implement British Government policies.

Hon. Members have, of course, already mentioned the possibility of private investment. The council does not have the means or access to the means to pay for investment, so private funding has been suggested. But if we examine the closure of the BBC's Arabic service, we immediately notice that private funding on the international diplomatic scene brings significant and heavy political and diplomatic costs. The Government's mishandling of the unfortunate al-Masari case has led to the direct closure of the BBC Arabic service, which was surely a private investment in a Government effort.

My questions on the BBC Rwanda service have still not been answered by the Foreign Secretary. We again notice immediately that that service might go because of the private investment that is keeping that service alive. Therefore, I suggest that to look for private funding to fund the British Government's policy internationally is a very shortsighted and ultimately foolish way in which to try to fill the gap, to replace the funds that the Government have mislaid somewhere. I am tempted to say, and believe, that the Government are asking the British Council to cut its cultural coat—which is Britain's cultural coat—to fit the Conservative party's shaggy cloth.

I also suggest that the pre-eminence of the English language internationally may have come about more because of the fact that English is the language of the computer industry and of the air traffic control industry. Mere communication by a language in the modern world does not mean that culture will come with it. English language culture—the civilisation of Shakespeare—is daily diminishing because of our absence from UNESCO. When we speak of the British Council, we speak no longer about its excellent underlying work in teaching the English language, but about the loss of the English, Scottish, northern Irish and Welsh cultures internationally.

The 1992 Conservative party manifesto, for the present Parliament, stated: the British Council acts as a cultural ambassador for Britain and for the English language…We will promote the English language by strengthening both the British Council and the BBC World Service. I was deeply saddened when I realised that that was not a valid statement of the policy being implemented. The reverse of that statement has happened with the BBC World Service, and the reverse is now happening with the British Council.

I should like to talk about the great difficulties in restructuring the British Council, which has been restructured and moved to Manchester—hence the initiator of this excellent debate. That restructuring was surely designed to make a leaner, meaner British Council to act into the millennium and beyond. Of course it is necessary—if the council is to protect its front-line operations, as the Secretary of State demanded in his statement to the House of Commons on 29 November—that the reductions come from savings in the United Kingdom. By 31 March next year, 350 posts will go, and those job losses will cost £36,000 per person. The Government, in their dying throes, are forcing an expensive game upon the British Council.

As the hon. Member for Linlithgow has already asked, why do not the Government allow the council's revenue-earning activities to finance its continuing development and perhaps even its enlargement? There is no subsidy for the activities of the enterprises from the grant in aid. Those areas of work have to build their own reserves in order to provide for capital investment and cover commercial risk. If they do not do that, they will not grow and will ultimately fail. The added loss of impact for Britain overseas will be large because the British Council operates in markets or parts of markets that might not be commercially viable for other United Kingdom service providers, as the vice-chairman has already pointed out.

How is the British Council to find cash savings of the magnitude required from internal efficiency and reorganisation? It cannot. There is no way open for it other than by losing important, valuable, highly trained and skilful people.

The consequences for us all are real. It is open to any of us to go to see the British Council's work in Russia or in any part of the world and to be overwhelmed, as the hon. Member for Linlithgow said, by its efficiency and care. I believe that it is even more important than that. The British Council has built up expertise and experience over many years and these cuts are at odds with the objectives of Britain's global foreign policy today.

11.51 am

Mr. Mike Watson (Glasgow, Central)

This is one of the rare occasions when hon. Members on both sides of the Chamber seem to be singing more or less from the same song sheet. I hope that, because of the pressure exerted from both sides, when the Minister responds he will have something positive to say about the future funding of the British Council. I should like to put to him a quotation from his colleague the Foreign Secretary, in answer to a question from the hon. Member for Broxtowe (Sir J. Lester). He said: We have protected the operating costs of…the British Council from the economies that are being made elsewhere in the public sector. I entirely endorse the objective that my hon. Friend has stated. That was about improving Britain's influence in the world through trade flows. If we did not take the same view, we would have subjected the operating costs of the…British Council to cuts. We have not done so. That is an indication of our good faith."—[Official Report, 29 November 1995; Vol. 267, c. 1189.] If that is good faith, I would not like to encounter him in a bad mood.

We have heard a litany about the projected cuts and the effect that they are likely to have if they are not reversed. I am concerned particularly about the prospect of a reduction in the British Council's influence in a number of countries in various parts of the world. The hon. Member for Broxtowe quoted from the transcript of last week's hearing of the Select Committee on Foreign Affairs. At that meeting, the director-general, Sir John Hanson, suggested that it was likely that there would have to be a pull-out from 27 major cities and 16 countries, seven of which would be Commonwealth countries.

I must ask the Minister whether the Government are prepared to tolerate that. If they are prepared to see withdrawals from certain countries and closures in certain major cities, will he name the cities and countries that he thinks are dispensable? If he does not, he will put an intolerable burden on the British Council, not just in terms of the work that it has done in the past, the contacts that it has made and the vacuum that would be left behind, but in trying to choose one against another. It is an impossible task and it is one that it should not be facing. It is incumbent on the Government to take some of that responsibility and on the Minister to tell us whether he feels that it is acceptable for such closures to be made.

Some hon. Members have mentioned the fact that the British Council is far better known overseas than in this country. That is true. Perhaps the debate and the coverage that it has received—there is a comment in The Daily Telegraph today—will help the council's image with the public.

I am concerned about the British Council's work in respect of international students in the United Kingdom. My constituency contains two universities, and I was at a meeting as recently as yesterday dealing with cuts in education. As we all know, those cuts are across the board and are aimed at fattening the calf—if that is not too topical a reference—for the tax cuts that it is hoped will help the Conservatives at least to hide some of their embarrassment at the general election. It will be futile, and it is a shame that organisations such as the British Council and universities have to bear the brunt of that political axe.

Both the universities in my constituency, Glasgow-Caledonian and Strathclyde, have international students. The British Council's role in influencing the number of students who come to this country should not be underestimated. The number doubled between 1984 and 1994, and with universities being so strapped for cash, they desperately need the full-cost funding brought by international students. If there is to be a reduction in numbers—there might well be as a result of a reduction in the British Council's influence and in its education counselling service—it could have a knock-on effect in the United Kingdom, quite separate from the British Council's situation. That must be borne in mind. I realise that that is not directly part of the Minister's remit, but I hope that he will comment on it.

There are 28 British Council offices in the United Kingdom, and a number of them could face closure. How will it help the British Council to improve its image with the British public if it has to withdraw from areas in which it already has a presence? It needs to be better known in this country and needs more outlets if it is to do its job that much better.

My hon. Friend the Member for Manchester, Central (Mr. Litherland), whom I congratulate on obtaining the debate and on the content of his speech, made it clear what the closures could mean for jobs. If the jobs go, there will be a knock-on effect on the way in which the British Council operates overseas. That is the base from which many of its activities are resourced, and if that base is cut, it will seriously affect its operations.

I am concerned at the extent to which the cuts imposed on the British Council have been disproportionate to the cuts announced in respect of the Foreign and Commonwealth Office. If there are to be cuts across the board, every Department must take its share. However, within that, it is unfair that an organisation as vulnerable as the British Council has been forced to take a disproportionate cut of 16 per cent., if one takes its Overseas Development Administration and diplomatic wing funding together. That is double the cut in the FCO as a whole. Can the Minister justify such a swingeing and unfair cut?

My hon. Friend the Member for Manchester, Central talked about the British Council's approach to dealing with the cuts since they were first announced some five months ago. It has been a softly-softly approach, quite different from that of the BBC World Service. It is up to the British Council to decide what tactics are best suited to it and, at the end of the day, their effectiveness should be the deciding factor.

Sadly, it seems that the softly-softly approach has not been effective. There is clear evidence of that in what I suspect the Minister will say today—although I remain optimistic—and in the views of the British Council's chairman. He seems finally to have lost faith in any approaches that he could make behind the scenes or in any ears in which he could whisper in the corridors that he treads.

It is strange that Sir Martin Jacomb has been placed in a position in which he has to be so trenchant in his criticism of the Government in general and the Foreign Secretary in particular. I have no doubt that he feels uncomfortable with that. He has talked about being strung along with assurances and of promises remaining unfulfilled to such an extent that he has now said that he is disappointed and filled with despondency. He is no icon of new Labour with a background of Eton, Oxford, Prudential and the Bank of England and all the other badges of honour that come from the corridors of power in this country. However, he has made that criticism.

It is shameful that the Government should treat people in that way, regardless of the organisation involved. There are means of arm twisting and negotiation to reach the end that one wants. Clearly, there is a feeling that the British Council has been let down. Everybody who knows the organisation, here and abroad, feels that if the cuts go ahead, the organisation will be severely undermined in an unfair and unwarranted way. I hope that the Minister will bear those comments in mind, as well as those from hon. Members on both sides of the House.

There is a great deal of good will towards the organisation. It wants to continue and even to expand the work that it is doing. It will be strangled in a number of areas in the world if the cuts go through. I urge the Minister in his response to tell us that there will be some alleviation of the cuts announced in November last year.

11.59 am

Ms Joyce Quin (Gateshead, East)

I warmly congratulate my hon. Friend the Member for Manchester, Central (Mr. Litherland) on initiating the debate, and on the way in which he introduced it. I am not surprised by the strength of feeling that he showed in his speech—indeed, that strength of feeling has been widely shared by all hon. Members who have spoken. This has been a cross-party debate in terms of support for the work of the British Council and the deep concern about the effects that the cuts will have on it.

I know that this concern is widely shared by hon. Members who have not been able to speak in the debate. For example, my hon. Friend the Member for Stretford (Mr. Lloyd) also speaks on foreign affairs from the Front Bench. His constituency adjoins that of my hon. Friend the Member for Manchester, Central. As a Front-Bench spokesman, he knows—as I do—the effect that these cuts will have on areas of the world for which we have responsibility in our Front-Bench roles.

My hon. Friend the Member for Manchester, Central spoke eloquently about the fact that the British Council was relocated to Manchester only four years ago. However, it is now facing major upheaval: there will be a dramatic loss of jobs and the office will be vacated—it took possession of the office so proudly only four years ago. The office was named 1993 office of the year. Despite that, the British Council is being forced to find smaller premises.

We also know that 1992 was the year of the general election, and the year in which the Conservative party put in its election manifesto its commitment to a strengthened British Council and a strengthened BBC World Service—that has been referred to by several hon. Members. Until now, this has been a less well publicised broken promise of the Conservative Government. The Labour party intends to continue to draw attention to this issue.

My hon. Friend the Member for Manchester, Central recognised that the British Council has an impact far wider than Manchester and his constituency—that it is of worldwide significance, that it is an important part of Britain's role and image in the world, and that its work brings substantial economic, trading and other short-term and long-term benefits to this country that are difficult to calculate but are evident.

It has been said that the villain of the piece is the Treasury, in forcing these cuts on the Foreign and Commonwealth Office. While I do not dissent from that, it seems to me that the Foreign and Commonwealth Office has achieved particularly poor performance in defending those parts of its budget that are particularly useful, such as the British Council and the BBC World Service. The Minister will remember the strength of feeling in the debate on the BBC World Service earlier this Session.

The hon. Member for Torridge and West Devon (Miss Nicholson) referred to the position of the BBC World Service Television in Arabic. A few days ago, I asked the Minister a question in this regard. He replied: Decisions about any future developments are a matter for BBC Worldwide Television."—[Official Report, 29 April 1996; Vol. 276, c. 358.] In other words, the Minister has washed his hands of the future of the BBC Arabic service, which is unacceptable, given the Government's responsibility for the budget of the BBC World Service and the concern about the future of the Arabic service and the BBC World Service in general.

As my hon. Friend the Member for Glasgow, Central (Mr. Watson) and other hon. Members have said, the British Council has tried to be reasonable in its approach to the Government in the face of the huge problems it is encountering. The enormity of what is happening is only just starting to strike home, because it has not received the publicity that has been given to other issues. As a result of this debate, the Government can be in no doubt that there is great concern about this issue. Now that publicity has been given to the problem, we will not be satisfied until some proper action has been taken.

It is important to stress that we are talking about cuts on top of cuts—that is what is making the situation so difficult for the council. It was hard enough to manage the cuts that were already in train, but the practical and economic consequences of cuts on cuts will make the problems catastrophic.

The British Council contests the figures that the Government gave in the narrative report accompanying the expenditure of the Foreign and Commonwealth Office. It has said that the report ignores the effect of cuts announced in the 1994 public expenditure round—cuts that take effect during the current survey period. The British Council has to face cuts of 16 per cent., rather than the 8 per cent. that the Foreign and Commonwealth Office is facing as a whole. I should like the Minister to comment on that.

This morning, hon. Members have given examples of the ways in which these cuts will affect the services of the British Council—they may even result in some closures. The British Council also gave examples in its evidence to the Foreign Affairs Select Committee. They seemed to me, and to other hon. Members, very alarming indeed.

For example, cutting services in central and eastern Europe seems to be a crazy and short-sighted decision when those countries are going through such a difficult transition period and need help, support and advice on a huge scale from western Europe and other parts of the world. It is particularly short-sighted if we are really interested in establishing long-term, good economic and political relationships with those countries. North Africa has also been mentioned. My hon. Friend the Member for Linlithgow (Mr. Dalyell) referred to Nepal and to some of the work that the British Council does in the poorest countries.

What is the Minister going to tell us this morning? Is he going to say where he is prepared to see those cuts? He should not evade his responsibility. As he has put the British Council in this situation, he has to be open with hon. Members and say where he expects those cuts and closures to take place, and what problems will be created as a result.

The debate has shown that hon. Members who have spoken are familiar with, and appreciative and supportive of, the work of the British Council. I have participated in some of the conferences organised by the British Council, in particular a recent conference in Oxford that brought together participants from the European Union and from central and eastern Europe. That event was most worth while. I know that the contacts that are made in such forums are likely to have long-lasting and positive effects.

Today, hon. Members have referred to the cuts that the British Council is being forced to make, and have said that they are short-sighted and, in many ways, self-defeating. The value of the council's work is tremendous. The spin-off of its work is terribly important in terms of the British economy and good relationships with other countries.

I have had interesting contacts with the British Council in Japan, and I know that the work done in that office is of dramatic value to the United Kingdom economy. An example was given where the arts section of its budget—which is about £500, 000 a year—helped to promote activity that was estimated to be worth £50 million. The figures provided by the British Council and some of the activities that it has promoted show a 10:1 return on investment—sometimes the investment is modest, but it has enormous economic spin-offs.

We are also very worried about the costs of closures. The BBC World Service has made that point effectively, especially in its evidence to the Foreign Affairs Select Committee. For example, the closure of the French service was estimated to cost £300 million, even though the overall cost saved was only £400 million, so one had to spend a tremendous amount simply to make such a closure. The British Council is especially worried about the cost of redundancies that will be caused by the loss of jobs resulting from the cuts.

I ask the Minister to give a specific commitment to give the British Council help with those redundancy costs. One of the problems that are especially acute at present, as the hon. Member for Broxtowe (Sir J. Lester) said, is that, if a decision to give some help with redundancies is not taken in the next few weeks, it will mean accelerated closures in some of the council's overseas operations—and the Minister must realise that no one who has spoken in the debate wants that.

The British Council is being put in an impossible position because it is required to live within the new rules, the new cuts, without adequate means of getting there. That is a real problem, which demands urgent negotiations with the Government and with the Minister. Perhaps the Minister will give us a commitment to hold urgent negotiations and discussions with the British Council.

I should like the Minister to give us an assurance that the cuts that we know affect the Overseas Development Administration, and which in turn affect the British Council, can be mitigated, so that the work of the ODA and of the British Council does not suffer disproportionately as a result of the contractual relationship between them to provide specific services.

Interestingly, in the public session that the Foreign Affairs Select Committee held earlier this week, the Chairman said that he was very concerned at the apparent mismatch between the central role that the British Council plays in our national endeavours, and the inadequate priority that it seems to get in the public expenditure queue. That point was reiterated earlier.

The debate and the speeches of hon. Members on both sides of the House amount to a serious indictment of the Government's approach to the British Council. The concern that has been expressed today, like the earlier concern about the BBC World Service, goes beyond the Opposition; it is widespread in and outside the House. We call on the Government to respond to that concern today by announcing that they will reconsider those savage cuts, which are highly damaging, not only to the work and future of the British Council and to Manchester and the constituents of my hon. Friend the Member for Manchester, Central, but to British interests in today's world.

12.12 pm

The Minister of State, Foreign and Commonwealth Office (Mr. Jeremy Hanley)

As the Minister responsible for the British Council, it is my privilege to reply, on behalf of the Government, on the subject chosen by the hon. Member for Manchester, Central (Mr. Litherland) —the British Council. I am very grateful to the hon. Gentleman for initiating the debate, and for giving me the opportunity to make clear the Government's appreciation of, and strong and continuing support for, the British Council.

As my noble Friend Lord Chesham said in the other place on 1 February 1996, the council is an integral and essential part of the United Kingdom's diplomatic and aid effort, and has been working in support of British interests overseas for more than 60 years.

Hon. Members on both sides of the House have spoken in glowing terms of the council's activities in a broad range of areas. I do not want to pick any particular speech. I shall mention the sacrifice of the hon. Member for Glasgow, Central (Mr. Watson); I believe that he is speaking on his birthday, and it cannot but be a great tribute to the British Council that he should give his time for that cause.

The scope of the council's work is indeed impressive: from promotion of the English language to the recruitment of overseas students, from high-tech information services to the promotion of development and good government, from scientific collaboration to the contemporary arts. All those activities have something in common: by highlighting British excellence and creativity, they enhance our prestige, support our exports and make long-term friends for the United Kingdom. In doing so, they complement and contribute to the work of the Foreign and Commonwealth Office in diplomacy, overseas aid and export promotion.

During the past 10 months, I have been most impressed by the council's operations, and have tried to visit them in every country I have been to. In Vietnam, the council is teaching English to officials who need English so that the country can play a full role in the Association of South-East Asian Nations. The Vietnamese Government were warm in their appreciation when we discussed the subject.

In Japan—to which the hon. Member for Gateshead, East (Ms Quin) referred—the council's activities support and underpin our important political and economic relationship and help to satisfy the hunger of a discriminating Japanese public for the best that is available in the arts and sciences. They succeed so well that the council's input often triggers a much larger contribution from the Japanese themselves, to which the hon. Lady also referred.

In India, I was especially struck by the council's network of libraries, which are an important source of information and expertise to their very large membership—people who are working hard to transform that country, already the world's largest democracy, into a developed and prosperous state. The libraries are also used by students seeking information about study in the United Kingdom. In some cities where we have no official commercial presence, the council's Department of Trade and Industry-funded overseas business centres provide facilities and contacts for visiting British business men and women.

The hon. Member for Linlithgow (Mr. Dalyell) asked where the council stood in the list of priorities for Government resources. We have recognised the council's valuable role in public diplomacy and development by substantially increasing its grant in aid, which we have increased by more than one third in real terms since we took office—between 1979–80 and 1995–96. That, together with internal efficiency savings and an expansion of non-grant activity, has enabled the council to expand its operations massively. It now has more than twice as many officers as, and operates in a third more countries than, in 1980.

The hon. Member for Torridge and West Devon (Miss Nicholson) said that we now operate in 109 countries, and she is right, but she did not say what the growth had been, because the council now has 229 offices in 109 countries, as against 108 offices in 79 countries in 1980. That extremely good record of expansion has been achieved under Conservative Governments.

We have been especially pleased that the council was able to seize opportunities opening up in central and eastern Europe after 1989, capitalising on the good will created and the friends made as a result of its persevering work during the dark days of communism. In the subsequent years, the council has helped those countries build up their English language teaching capacity and restore a flourishing network of contacts with fellow professionals in the west. The council's resource centres have also given the United Kingdom a high profile in many cities throughout the region.

Mr. Dalyell

Will the Minister give way?

Mr. Hanley

I am sorry: I really must place on record what I want to say, and I am sure that the hon. Gentleman, with his customary courtesy, will allow me. If I have time towards the end, I may allow him to intervene.

I say all this to emphasise that the Government recognise and very much appreciate the council's work throughout the world. Against that background, I turn to the subject that most interests hon. Members today—the reductions in the council's grant in aid during the next three years.

Hon. Members will know that the council receives two separate grants in aid, one from the diplomatic wing of the FCO and the other from the ODA. The diplomatic wing at present provides about three quarters of the total.

As hon. Members will also recognise, pressure for further efficiency means that the last public expenditure round was extremely rigorous, and all Government Departments have been involved in a drive to cut costs and sharpen priorities. In the public expenditure survey settlement, the FCO diplomatic wing took a cut of about 7 per cent. in its baseline in each of the three years covered by the survey. As a result, the diplomatic wing budget is scheduled to fall by about 12 per cent. in real terms over the period.

As it is Government policy to strengthen, rather than reduce, the promotion of British interests overseas, that represents no mean efficiency challenge. In those circumstances, inevitably the council could not be exempt from the need to make further savings.

In deciding the grant in aid for the council, the diplomatic wing took account of the fact that the council's baseline was already declining following the 1994 PES, and sought to lessen the impact of the 1995 settlement. Accordingly, we passed on to the council only part of last autumn's cut, imposing an extra burden on the diplomatic wing. In that way, we ensured that the percentage reduction in the diplomatic wing's grant in aid to the council over the three-year PES period was broadly in line with the reduction in the diplomatic service's budget as a whole.

That was a tribute to the value that we attach to the council's work, given the pressure for extra effort and resources for other FCO activities, including the promotion of exports and inward investment, consular work and immigration control overseas, diplomacy and negotiation—all of which are crucial to the prosperity and well-being of the people of this country.

As for the ODA grant in aid, hon. Members will be aware of the pressure on the aid budget, especially given the inexorable rise in our binding commitments to the multilateral agencies and European Union programmes. Within the reduced bilateral aid budget, Ministers' first priority remains the country programmes, which provide direct assistance to those developing countries working to put in place sound development policies and good government. That placed additional pressure on other parts of the aid budget. The real terms reduction in the British Council grant in aid was comparable with that for non-country bilateral programmes as a whole.

However, the council contributes to development, not only through its grant-in-aid work, but through contract work under the bilateral aid programme, for which it competes with other British suppliers. The council has a good record in winning such business. Overseas Development Administration contracts will account for nearly £100 million of the council's turnover this year. We expect that project work to continue, and hope that the council will also be able to promote development increasingly through the management of multilateral aid programmes.

The Government welcome the fact that, in the present circumstances, the council has chosen to take a radical look at all its operations in order to focus on what is essential and what might be done differently. It has concluded that its most valuable asset is its network of overseas offices, which has enabled it to build up extensive contacts with overseas Governments and organisations. It has decided—rightly, in the Government's view—that the first priority must be to preserve that overseas network as far as possible.

The corollary to that is that there will have to be radical changes in the United Kingdom. How the council chooses to restructure its operations in those circumstances is largely a matter for its management. We understand that its management propose to make greater use of specialist advisers from outside the council rather than in-house expertise, and to concentrate on front-line functions by making reductions in support staff—both proposals are very much in line with trends in other organisations in both the public and private sectors.

The hon. Member for Manchester, Central and other right hon. and hon. Members have drawn attention to the staffing reductions that that process will entail—on top of reductions that have taken place over the past few years. The council has already embarked on a new voluntary early retirement programme. Some compulsory redundancies will almost certainly be required, too, although the actual number is not yet known. That is always a painful process, especially with staff who have given loyal and committed service to a cause in which they strongly believe.

We naturally regret the distress that the process will inevitably cause to those involved. We understand that staffing reductions are likely to occur in both London and Manchester, but that the council is most unlikely to withdraw from Manchester completely. I have visited the office, and share the admiration that has been expressed for it in the House today.

The Government recognise that, even after restructuring in the United Kingdom, the council will need to make some adjustments to operations overseas. The council is currently discussing its plans with the Foreign Office, to try to ensure that the impact on our interests overseas is kept to a minimum. The Government do not want to see the closure of British Council posts.

Studies are therefore being undertaken with the aim of avoiding closures. The results of those studies should be available later this month, and I cannot today anticipate the outcome, but I believe that the results will emerge before the end of the month. We do, however, recognise the council's urgent need for clarification of the funding prospects.

Studies are also being undertaken by the efficiency unit, which is looking at the council's proposals for dealing with the projected decline in the grant in aid following the 1995 PES settlement, including redundancy plans, and its approach to improving the efficiency and effectiveness of its operations at home and overseas. The council is co-operating fully with the efficiency unit in its work. We expect that report by the end of this week.

The council is, of course, much less dependent on the grants in aid than it used to be, with nearly half its income now drawn from revenue-earning activities. The council's English teaching operations in particular have expanded rapidly, spreading the highest professional standards and attracting an influential clientele in a wide range of countries.

I have visited many posts throughout the world and seen English teaching in action—it is popular, and there should be more of it. We are delighted that the council, together with other organisations involved in English teaching, is taking advantage of the huge demand for English overseas to promote the language at no cost to the taxpayer. I agree with those right hon. and hon. Members who have today said that they want English English, not some other version of English, to be taught around the world.

The council's direct teaching operation is entirely self-financing—there is no question of subsidy from the grants in aid. People sometimes level criticism at the British Council because they believe that it subsidises the teaching of English, and is unfair to those who teach English in the private sector. I can assure the House that I have looked into the matter, and that the council's teaching of English is on a very fair cost basis—there is no subsidy from grants in aid for it.

The council has also been very successful in drawing in sponsorship and partnership funding, both to make the grants go further and to cement relationships with partner institutions both here and overseas. The Education Counselling Service, which runs a student recruitment service in key markets overseas and is co-financed by the council and British academic institutions, is an excellent example of partnership in action. The arts events supported by the council are now largely paid for by sponsors, with the council's contribution limited to professional expertise and modest seedcorn funding.

Mr. Dalyell

What has been said today by the Minister's colleagues should be brought to the attention of those undertaking the studies and of the Treasury. Parliament's views should be taken into account.

Mr. Hanley

I can give the hon. Gentleman that assurance—indeed, I was about to mention that subject.

My hon. Friend the Member for Broxtowe (Sir J. Lester) mentioned the Select Committee on Foreign Affairs, where the Chairman recently remarked on an apparent mismatch between the council's central role and its position in public expenditure terms. The Select Committee will be looking at FCO expenditure in greater detail later this month, and will then consider the council's position in relation to the diplomatic wing and the ODA as a whole.

Obviously, there is no point in my commenting on the transcript of the Select Committee's minutes, except to say that my right hon. and learned Friend the Secretary of State and I have read it, and we shall take it into account in the next few days. There is no point in my commenting in detail on the Chairman's remark before the Committee has completed its deliberations.

Right hon. and hon. Members have spoken most eloquently this morning about their support for the activities of the council, both at home and overseas, and their concern over the reduced funding of those activities. The debate will be read, and decisions will be complete by the end of May—I repeat that assurance for the benefit of the hon. Member for Linlithgow (Mr. Dalyell).

Let me conclude by reiterating the Government's strong support for the British Council and its role in winning hearts and minds for Britain around the world. The council, like many institutions, is having to face up to a period of change. It will in future have a smaller UK base, and rely more on outside advice. There will have to be some reordering of priorities overseas.

Some of those adjustments may be painful, and we recognise that hard choices have to be made. But all organisations today face the problems of challenge and change, and the council has a long record of successful adaptation to new circumstances. I have no doubt that the council, with its extensive overseas network, will continue to play an important role in furthering Britain's prestige, influence and interests for many years to come. That is certainly the Government's intention.

I conclude by repeating that the council now has 229 offices in 109 countries. When the Government took office, there were 108 offices in 79 countries. That is a record of achievement.