HC Deb 24 June 1997 vol 296 cc671-89 3.30 pm
The Prime Minister (Mr. Tony Blair)

With permission, Madam Speaker, I should like to make a statement on the summit of Eight held at Denver last weekend. I have placed in the Library of the House the communiqué and other documents issued following the summit.

One of the most stimulating discussions at Denver was on the need for structural reform in all our economies. Different countries face somewhat different problems, but we all face the challenge of how to take advantage of increasing globalisation and provide new job opportunities. In many countries, unemployment, particularly among young people, is far too high.

We need to combine greater labour market flexibility with action to improve work incentives, skills and employability, and reduce the risk of marginalisation. The summit welcomed the UK's plan to take forward work on that at a meeting of G8 Finance and Social Affairs Ministers in London early next year, and then at the Birmingham summit.

We also discussed the problem of transnational organised crime, which is a growing preoccupation for us all. Crime is becoming increasingly sophisticated and international, and criminals will quickly exploit the newest technologies to evade detection. We must fight them on their own ground, developing greater international co-operation and new techniques to match the threat.

Over the coming months, we shall work up specific proposals on co-operation against crime, including drug trafficking and financial crime, which we can then consider in detail at next year's summit.

In Denver, the Finance Ministers reported on the progress that they had made on measures to increase financial stability. My right hon. Friend the Chancellor of the Exchequer will lead the follow-up next year on plans further to improve co-operation between financial supervisors.

The summit focused particular attention on Africa. We agreed on the need to combat poverty through debt relief, improved market access and support for education. The priority is to focus assistance where it is most needed and will reap most benefit—that is, those countries that are introducing economic reforms and which respect the principles of human rights and good governance.

We emphasised the importance of not wasting money on unproductive, especially military, expenditure and of combating corruption. I announced that, over the next three years, Britain would increase by 50 per cent. our support for primary education, basic health care and clean water in sub-Saharan Africa.

We discussed United Nations reform, and welcomed the Secretary General's efforts. We encouraged him to undertake a system-wide review of the UN and its agencies. We agreed on the need to develop the UN's ability to prevent and resolve conflict, and we all recognised the need to solve the UN's funding crisis as soon as possible.

The leaders of the Seven also agreed to provide $300 million towards the cost of restoring the sarcophagus over the Chernobyl reactor to prevent any further leak of radioactive material.

I was pleased to get the strong support of all other leaders for our views on Hong Kong. The communiqué underlined the G8' s durable interest in Hong Kong's stability and prosperity, and looked forward to democratic elections there for a new legislature as soon as possible.

Foreign Ministers discussed a number of regional and global issues, and presented a detailed report to Heads of Government. The summit issued a separate statement on Bosnia, reaffirming our commitment to the peace agreement, and backed efforts to achieve a lasting settlement in Cyprus. The communiqué also records unanimous support for progress towards a legally binding international agreement to ban anti-personnel land mines.

I welcome Russia's participation as a major partner in the summit of the Eight. President Yeltsin played a fuller role than ever before, and we agreed to continue our efforts to help Russia to integrate into the global economic system. Russia will shortly be participating as a creditor in the Paris Club.

We naturally devoted considerable time in Denver to environmental issues, many of which are being followed up at the UN General Assembly special session which opened yesterday.

There is much that we need to do to improve the environment we live in. Cleaner air, cleaner water, less congestion and better use of scarce resources matter to all of us. In developing countries, alleviating poverty is the key to sustainable development. We are committed over time to reversing the decline in Britain's development assistance that occurred under the previous Administration.

Much of the public attention, though, has focused on efforts to tackle the threat of global warming. We made some progress at Denver, which I hope to see consolidated at the UN session in New York. Everyone accepted that, by the time of the Kyoto conference later this year, we must agree binding targets for reductions in greenhouse gas emissions beyond the year 2000.

As the House will know, the European Union has already put forward proposals for a target reduction of 15 per cent. in greenhouse gases by the year 2010. The British Government have indicated their readiness to go further. We are already likely to achieve a reduction of 10 per cent. in greenhouse gas emissions by the year 2000.

Such targets are tough, but they are achievable by policies that are sensible in their own right: an integrated transport policy that makes public transport more attractive and gets traffic flowing more smoothly; increasing the use of renewable forms of energy; improving energy efficiency in firms and the public sector, bringing it up to the standards of the best, and increasing the use of combined heat and power; and improving energy efficiency in homes—for example, through promoting self-financing schemes by the energy suppliers.

Measures aimed at producing environmental benefits are often seen as burdensome or unachievable when they are first proposed, but experience shows that sensible measures produce sensible results—as we saw with measures to promote the use of unleaded petrol, for example.

We discussed a number of other key environmental issues, including the need to work for an international agreement on forests, with suitably high standards. We also discussed how to increase access to clean water and sanitation, and how to improve international co-ordination of efforts to protect oceans and to manage fisheries.

This was my first G8 summit and I was struck by how much better the discussions were when we had time to focus on the key issues common to all our countries. Next year, I want to take that further and concentrate on fewer issues in greater depth. In some senses, it will mean a return to the original concept of G7 and G8 summits, using the opportunity for informal but substantive discussions.

At Birmingham, I want to concentrate in particular on two subjects: the issue of jobs and employability, and the challenge posed by organised crime. The first will be a major theme of our presidency of the European Union in the first half of next year. Both are of central importance to all the G8 countries.

I am grateful to the President of the United States for his hospitality at the Denver summit this year and to the authorities there, and I am grateful to the people of Birmingham for agreeing to host next year's summit, which I am confident will be an equal success.

Mr. William Hague (Richmond, Yorks)

I thank the Prime Minister for his statement. I welcome many aspects of the Denver summit, in particular the new and deeper participation by Russia, and the conclusions on Hong Kong and on closer co-operation in fighting organised crime.

Does the Prime Minister agree that there is often too much on the agenda at such summits? I welcome his readiness to continue the efforts of his predecessor to reduce their length and to give them sharper focus.

I welcome also the discussion at Denver about the need for structural reform of economies, and the section of the communiqué that calls on countries to increase the responsiveness of labor markets to economic conditions". Does the Prime Minister recognise that the achievement of increased responsiveness in the United Kingdom is a vindication of the strategy adopted by the previous Government, and is one of the reasons why the new Government have inherited the best economic prospects in a generation? How will he continue to work towards that objective? How does he believe that he will be supported in that endeavour by introducing job-destroying rigidities, such as the social chapter, into the labour market?

I welcome also the acknowledgement that aging populations mean that Some of our countries face major challenges in sustaining their public pension systems". Does the Prime Minister believe that the United Kingdom is one of those countries? If so, will he recognise that pension systems can be sustained better and future pensioners advantaged by pursuing innovative pensions policies rather than disparaging them?

The communiqué calls for "active aging strategies". Can the Prime Minister tell us what an active aging strategy is? Does he have one?

The Prime Minister referred also to aid for Africa and announced increased support for primary education and other projects in sub-Saharan Africa. That is a worthy objective, but from which budget will the additional funds be drawn?

I thank the Prime Minister for congratulating the previous Government in his speech in New York on their environmental achievements—although we wish that he had done so before. Will he remind the House that, thanks to the actions of the previous Government, this country is one of only three in the world that are on course to meet the Rio targets? Do the Government understand why that is so? Does the Prime Minister agree that successful free enterprise economies that are based on private ownership are in the best position to safeguard the natural environment, and that sensible incentives often work better than heavy-handed regulation?

What specific measures does the Prime Minister propose in order to achieve the additional 20 per cent. reduction in carbon dioxide emissions to which he is now committed? Can he clarify that commitment, as it was not in his statement to the House this afternoon? He mentioned policies to achieve that objective that are in place already or are so general as to be meaningless. When will he be able to shed more light on those proposals? Will they entail going back on statements made by his Industry Minister favouring coal-fired rather than gas-powered power stations? Will he pursue that target irrespective of the actions of other countries or only in concert with them?

The Denver summit failed to agree on new targets for reducing greenhouse gas emissions. Does the Prime Minister share our dismay that the G8 failed to reach a new agreement, since real progress can be made only through international agreement? In the light of our special relationship with the United States, does the Prime Minister agree that it is regrettable that President Clinton did not accept the proposed new targets? How will the Prime Minister persuade him to do so? Is it not vital to have international agreement on targets for the decade ahead, just as targets for this decade were negotiated successfully by the previous Government at Rio?

Will the Prime Minister reassure the House that any increase in taxation in order to meet environmental objectives will be matched by reductions in other taxes so that legitimate environmental concerns are not used to justify large rises in the overall burden of taxation? The country wishes to know that, along with the fine words and the worthy objectives, the Government can produce some specific policies, successfully negotiate international agreements, and produce tax proposals that have the desired effect without damaging the growth of enterprise that, alone, provides the means of safeguarding our environment.

The Prime Minister

I welcome the right hon. Gentleman to his new position. He asked what is an active aging strategy. The best active aging strategy that I know of is to be either Leader of the Opposition or Prime Minister—we shall see how we both fare in that regard. I welcome the fact that the right hon. Gentleman agreed with much of the Denver communiqué, particularly the points about organised crime, Hong Kong and the participation of Russia. That is precisely what I am saying in relation to G7 summits. It is important that they concentrate on fewer issues, but go through them in depth.

As for structural reform, the words "responsive to change" are those that the Government have been using. They mean not only more flexible labour markets but an emphasis on education and skills, and ensuring that people can be genuinely employable within new labour markets. Decent civilised standards of treatment for people at the workplace are not inconsistent with a prosperous economy.

The right hon. Gentleman asked about Africa, budgets there and the announcement of 50 per cent. more provision for basic education and health care. The money will be found within existing budgets as part of our policy of reallocating priorities and focusing our aid on the poorest countries. Commitments over the past three years have totalled about £240 million, and commitments over the next three years will therefore be increased to about £360 million.

The right hon. Gentleman asked me also about targets and the measures that we might take to meet those which we have set ourselves. I believe that the targets that we have set ourselves are achievable by continuing with the types of policy that we have been outlining over the past few weeks—for example, in relation to an integrated transport system, working with the rail operators to ensure that they make sure that more is done to integrate their services by introducing such things as through ticketing, giving people the real choice of being able to use public transport where they wish to do so and, in relation to improved energy efficiency in firms and the public sector, the energy efficiency best practice—[Interruption.] The right hon. Gentleman asked me for the details, and I am giving them to him.

The energy efficiency best practice programme has a target of generating additional savings worth £800 million a year by the year 2000. We are well on target to achieve that. If we continue with the policies that we have outlined, we believe that we will meet that target. It is part of a continuing programme. As for improving energy efficiency in homes, not merely is the home energy efficiency scheme in being, but part of the new Government's proposals is the establishment of an environmental task force that will be specifically charged with assisting measures that will combat some of our environmental problems. In all these areas, we shall continue to make progress. I believe that we can meet the targets.

The right hon. Gentleman said that it was a pity that Denver G8 failed to reach agreement. It is a pity that we were unable to go further there. The key event, however, will be the Kyoto conference, which will take place later this year. The US has given an indication that it will be in a position then to agree legally binding targets for the future. If that can happen, that will be substantial progress. Yes, we would have liked to go further at Denver, but, as I have said, I think that the key issue is what happens at the Kyoto conference. I think that the possibilities there are good.

The right hon. Gentleman will have to await the Budget for any matters of taxation. I believe that the most important thing that we can do in respect of meeting the targets to which I have referred is to continue with the measures that relate especially to transport and energy efficiency, which we have already outlined. If we do that, we have the best chance of making a significant contribution to reducing greenhouse gas emissions, which is what we all want to see.

Mr. Paddy Ashdown (Yeovil)

I join the Prime Minister, first, in welcoming the right hon. Member for Richmond, Yorks (Mr. Hague) to leadership of the Conservative party. I think that I am right in saying that he is the sixth leader of one or other of the two parties, Conservative and Labour, that I have seen since becoming leader of mine. I wish him—[Interruption.] Look how I look, Madam Speaker? I look younger every day. I wish the right hon. Gentleman well in his task, which most people regard as impossible.

I very much welcome the thrust of the Prime Minister's statement. The Denver summit of Eight was obviously more successful than most of these summits and it achieved a number of notable things. I welcome particularly the inclusion of Russia. I especially welcome the clear statement on Hong Kong. It is, of course, the case that the Sino-British agreement is an international agreement. The fact that that will be observed in detail by the international community will be a great incentive to ensure that the agreement is carried out in full, especially in relation to the preservation of democracy.

I also welcome the clear statement on Bosnia. I am sure that the Prime Minister will agree that, unless the warring parties understand that they must make faster progress, there is a real possibility that the momentum for peace will slip away and the situation will slide back towards warfare and conflict, perhaps even in the very near future.

I regret that there was not greater agreement on the environment, although perhaps that was too much to ask. It is welcome to see the Prime Minister and the Government taking the lead on environmental matters. I am almost tempted to say that, once again, they seem to be observing more of our manifesto than theirs, but that would be curmudgeonly, so I shall not say it.

No doubt the Prime Minister was happy to see the newspaper headlines about his leadership when he returned. I remind him that I have seen those headlines before, and so has he. I remember the 1989 summit, from which the then Prime Minister, Mrs. Thatcher, returned to headlines—in The Daily Telegraph I think—saying, "Thatcher to save the planet" and "Thatcher dons green mantle for economic summit". The right hon. Member for Huntingdon (Mr. Major) had similar headlines. Does the Prime Minister realise that he will be judged not by the rhetoric or the newspaper headlines, but by results and actions?

We will look for those results when we consider next week's Budget. Will there be a move towards green taxation? Will there be a reduction of VAT on home insulation? Will there be a national home insulation programme? The Prime Minister cannot answer those questions now, but does he recognise that we will judge what he does rather than what he says? He will be judged by his actions and not by the rhetoric, although welcome, that he used in Denver and New York.

The Prime Minister

I thank the right hon. Gentleman for his agreement to much of what we did. I shall deal with his two main points.

We want faster progress in Bosnia. We want a far greater impetus towards implementing the Dayton agreement and greater pressure from the countries involved to achieve that. I have been saying that for some time, as has President Clinton. If pressure to reach agreement is taken off those countries, there is a risk that the whole process will slip backwards; that would be desperately unfortunate. I agree whole-heartedly with the right hon. Gentleman on that.

On the environment, the right hon. Gentleman will have to wait for the Budget, as he knows. I agree that the issue is results and not rhetoric. In the programmes that we have already outlined, there is at least the prospect that results will be achieved. I believe that they are achievable, provided that the national will and the political will are there.

Mr. Tam Dalyell (Linlithgow)

On Africa, does the Prime Minister recall that the one subject about which President Mandela wrote a personal letter to the previous Prime Minister was his unease about Libyan sanctions? The unease felt about Lockerbie has been outlined in 11 Adjournment debates. Will the Prime Minister also reflect on the Channel 4 programmes that cast grave doubt on whether the Libyans were responsible for the brutal and wicked murder of WPC Yvonne Fletcher? Before dismissing them merely as television speculation, will he take into account the fact that to do so he would have to suppose that George Styles, the senior ballistics officer of the British Army, does not know much about ballistics, that Hugh Thomas, who was the senior consultant at the Royal Victoria hospital in Belfast, does not know much about the angles at which bullets enter bodies, and that Bernard Knight, as the distinguished Home Office pathologist in charge of the Cromwell street investigation, does not know about pathology? Will he take this matter seriously?

The Prime Minister

As I said to my hon. Friend last week, the Libyan sanctions will remain until Libya complies with the United Nations Security Council resolutions. The Channel 4 programme was a follow-up to the original programme that was made some time last year. The continuing investigation into the murder of WPC Fletcher is a matter for the police, and anyone who has new evidence relating to the crime should pass it to them. The original extensive investigation by the Metropolitan police forensic science laboratory and the pathologist Dr. Ian West concluded that she was killed by a bullet fired from the Libyan People's Bureau. Every piece of new evidence has been reviewed, but my advice is that the view prevails that she was killed by a bullet from the Libyan People's Bureau.

The police are reviewing the contents of the programme broadcast on 5 June and they expect to have completed their analysis by the end of September. I do not hold out to my hon. Friend any prospect of change in that respect; I merely say that, whenever new evidence is presented or claims are made, they are investigated. However, the best advice that we have at the moment remains the original advice.

Mr. David Maclean (Penrith and The Border)

As most greenhouse gases are produced by America, south America, China and the developing world, why is the Prime Minister determined to punish British people, particularly our rural constituents, by setting targets that go much further than those observed by the rest of the world and will be particularly damaging to Britain? Does he not agree that we should sign up unilaterally to targets for greenhouse gas emissions rather than trying to make a grand green gesture that will hurt our constituents?

The Prime Minister

It will not hurt our constituents at all. The agreement that was reached between European Union members for a 15 per cent. reduction in greenhouse gas emissions based on 1990 levels was negotiated by the Government of which the right hon. Gentleman was a member. We believe that we can go further, but, even on existing policy, by 2000 we will have achieved a 10 per cent. reduction.

Of course, we want other countries to go further. That is why we have put pressure on them. The Kyoto conference will provide an opportunity to see what progress has been made with the United States and other countries, but I believe that the measures that have been taken with the support of right hon. and hon. Members on both sides of the House have been to the advantage of our constituents. It will be to the advantage of our constituents if we reduce pollution and the damage that has been caused not merely to the world's climate, but to clean air in Britain.

Mrs. Alice Mahon (Halifax)

In relation to land mines, have other countries stated their intention to follow Britain's lead in banning the production, sale and trade in those horrible weapons?

The Prime Minister

No specific country is about to follow precisely the lines that we have articulated, but the importance of the words in the communiqué is that there is agreement in principle that we need an internationally binding agreement banning the sale of anti-personnel mines. We are making progress, but we still have a long way to go. The fact that Britain has taken a lead will help to achieve that international agreement.

Mr. Eric Forth (Bromley and Chislehurst)

Did the meeting take any opportunity to compare the economic reforms in the United States with those in the European Union? If so, were any conclusions drawn about the rather different approach taken in north America from that in Europe? Did the Prime Minister draw any conclusions about the direction that the European Union seems to wish to take, particularly in respect of labour market flexibility, and the disadvantage that that would inflict on the European Union in a globally competitive economy?

The Prime Minister

As the right hon. Gentleman knows, it is important that we combine labour market flexibility with investment in people. The United States recognises that it has a significant problem in large numbers of young people in particular who are shut out from mainstream society without any hope or opportunity. That is something which our countries have to correct. It is not a one-way process: there is much to be learned on both sides. There are also measures that all countries agree make a difference to economic performance.

In contradistinction to the Opposition, I believe that there is a role for government, but that it is a different role today. It relates to infrastructure, education, technology and assisting small businesses and needs to be fulfilled here as well as in other countries.

Mr. Desmond Browne (Kilmarnock and Loudoun)

I welcome the concentration by the G8 summit on international crime and drug trafficking. My right hon. Friend the Prime Minister mentioned specific proposals that are being worked up for discussion next year. What specific measures does Britain wish to see taken, with especial reference to the threat of organised crime emanating from Russian and eastern Europe?

The Prime Minister

My hon. Friend is right. As the host of the G8 summit next year in Birmingham, we are expected to bring forward specific measures to combat organised crime. Already, the G8 working group has agreed some 40 detailed recommendations to counter transnational organised crime. Those are now being implemented, and include extradition proceedings, co-operation between law enforcement agencies and, specifically, attempts to track down the proceeds of drug trafficking. We hope that we will be able to take a significant step forward next year. One of the advantages of Russia's involvement in the summit is being able to talk face to face with the Russians about the measures they need to take to defeat the organised crime that often comes from Russia and is spreading across Europe.

Mr. John D. Taylor (Strangford)

The Ulster Unionists also welcome the Leader of Her Majesty's Opposition to his new position and look forward to working with him on many issues, including the important one of Northern Ireland. The importance of that subject was underlined by the fact that the Prime Minister, following his journey back to the United Kingdom, is already devoting several hours to it today. We thank the Prime Minister for the statement that he has given on the Denver summit and, in particular, the apparent contribution he made to the summit on behalf of our nation.

I welcome the communiqué's reference to a lasting settlement in Cyprus. Does the Prime Minister agree that a lasting settlement in Cyprus would be preferable before the accession of Cyprus as a member of the European Union? Does he agree that it is important that the Government's attitude to the Turkish and Greek Cypriot communities is even handed and, therefore, does he agree that the Government should follow the example of the previous Government and that the Foreign Secretary should meet the leaders of both communities in their respective parts of Cyprus?

The Prime Minister

On the latter point, I will let the right hon. Gentleman know exactly what is proposed. I am sure that there will be no objection to that. On the question of Cyprus, the possibility of accession negotiations taking place makes it all the more important that a settlement is achieved. The United Kingdom fully supports the UN-led search for a settlement. The prospects of EU accession and the need to reduce tension make that settlement all the more necessary.

We support the EU commitment to open accession negotiations with Cyprus six months after the end of the intergovernmental conference, which will be during our presidency, so we will have a leading role to play. The conclusions of the Denver summit underline the importance that the international community attaches to the issue, and I hope that we can move forward on it. The right hon. Gentleman will know that Richard Holbrooke has been appointed as the US presidential envoy and Sir David Hannay is the UK's special representative. I hope that their appointment will assist the process and help to develop ever greater urgency in the search for a settlement.

Helen Jones (Warrington, North)

While I am sure that the House welcomes my right hon. Friend's comments about tackling the problem of world poverty, will he indicate the time scale within which he thinks Britain will reach the UN target for development assistance?

The Prime Minister

No, I cannot put a specific time limit on it, because we will have to do it as we can. If my hon. Friend looks back at the record of the previous Labour Government, she will see that we made tremendous strides towards achieving it. We will do it as we can and we consider it important. It is essential to realise that the development of such countries, especially in Africa, is in the long-term interests of our country. We are not being asked to sacrifice our self-interest for others: there is a mutual self-interest in ensuring that the problems are dealt with.

Mr. Richard Ottaway (Croydon, South)

Does the Prime Minister agree that population growth is the root cause of African poverty and indeed, of general environmental decline? Will he confirm that he will make that one of his reallocated priorities and will he continue the all-party consensus on the subject?

The Prime Minister

I shall certainly continue the all-party consensus. However, the issue of population growth must be seen in the context of how the countries are developing. The greater their prospects of serious economic development, with a proper enterprise sector in their economies and reduced corruption—because corruption is a blight both on inward investment and on any sensible allocation of aid—the better things will be. It is important to see measures related to population growth in the context of all the other things that we are doing to bring about a different way of life in those countries. However, as I said, I am happy for the cross-party consensus on the subject to continue.

Mr. Keith Vaz (Leicester, East)

I warmly welcome the Prime Minister's statement, but does he agree that more should be done by our G7 partners to ensure the full implementation of the HIPC—heavily indebted poor countries—initiative by the International Monetary Fund and the World Bank, because that is one of the ways in which we can help to reduce debt for the poorest countries in the world?

The Prime Minister

Yes, I agree. The HIPC agreement is important, and the new Secretary of State for International Development has laid emphasis upon it. As I discovered during some of the bilateral meetings that I had with those from African countries during the United Nations meeting, some of those countries spend a vast proportion of the public money they spend simply on debt repayment, so that, of their overall expenditure, only a small percentage is left for trying to develop their countries. In the end, that is a huge inhibition on their development.

Sir Teddy Taylor (Rochford and Southend, East)

Did the summit accept the fact that it is traffic congestion rather than traffic volume that causes the most air pollution problems? Will the Prime Minister make a contribution to solving such problems by removing as speedily as possible the freeze on road schemes designed to remove pollution, including those for the A13 and M25, which would make a considerable contribution to reducing air pollution?

The Prime Minister

We have moved pretty quickly from world statesmanship to constituency interests. As for the individual road schemes, the hon. Gentleman will know that a road review is now being undertaken, and I cannot tell him anything about his particular road. However, if there is something that we are about to do about it, I shall let him know. I might add that I believe that one of the most important things that we can do to reduce pollution is to encourage the use of public transport.

Mr. Dennis Skinner (Bolsover)

In the attempt to combat international crime, has my right hon. Friend considered using the services of George Carman? As for the problem of the hole in the ozone layer, will he remember that he will not be able to solve it by market forces, nor by using a man with a bike, a ladder and an enterprise allowance? It can be solved only by intervention, planning and organization—[HON. MEMBERS: "Socialism."]—by other nation states. That cannot be done by market forces.

The Prime Minister

If I may so to my hon. Friend, there is some truth in what he says. [Interruption.] Nervous looks all round. I do not know about hiring George Carman. I do not think that we can afford his fees; I shall have to speak to the Chancellor about that. In my view, the environmental problems require a mixture of solutions. Of course, there are important measures involving regulation and intervention. I agree that if we want an integrated transport strategy, it will not come about through market forces.

On the other hand, unless developing countries in Africa and elsewhere have effective market economies, with private enterprise in them, they will never make the transition to more developed economies that is essential if they are to tackle their environmental as well as their other problems. If this does not seem like too much of a balancing act, I would say that we need a mixture of the two.

Mrs. Margaret Ewing (Moray)

I welcome the general thrust of what has been said in the exchanges on the statement, and emphasise the point that expenditure will have to be involved in some aspects of it. Will the Prime Minister elaborate on what he meant when he said that the leaders had emphasised that there should be no "unproductive" expenditure, particularly in the military sphere? Will there be further developments in disarmament and particularly in getting rid of nuclear weapons—surely one of the white elephants of this century? Could not the money involved be better spent in other areas?

The Prime Minister

I meant that it is important that any aid that we give to countries is used for genuinely productive purposes, not for corruption or buying weapons. Much of the debt of those countries is related to their weapons burdens. One of the reasons why it is important that Russia becomes a member and creditor of the Paris Club is precisely so that some of those debt problems can be reduced.

It is important that we continue with a properly structured aid programme and we would like to increase it if possible. But the quid pro quo is that the money must go into economies that genuinely have a chance to use it constructively. There must be an insistence that proper strings are attached to make sure that money is not wasted on corrupt or unproductive investment.

Finally, aid must be provided in a way that gives those economies a long-term future, rather than shovelling money for no proper purpose. In the end, our constituents are prepared to accept that we have an international and moral responsibility, but they insist—perfectly reasonably—that if money is spent, it should be spent properly.

Mr. Tony McNulty (Harrow, East)

Did the Prime Minister underline to the other Heads of Government the importance of ensuring the stability, peace and democratic future of Hong Kong? Will he outline some of the discussions that were held to ensure that those are guaranteed?

The Prime Minister

It is important that we have a continuing commitment to Hong Kong and, under the terms of the joint declaration, we will be involved for a significant period after the handover. We have made it clear that one of the key issues is the undertaking to hold democratic elections within 12 months of the handover. We must make sure also that we are sufficiently mobilising international opinion, so that not merely Britain but all parts of the international community are exerting pressure. The importance of the words in that communiqué was precisely that—there was a consensus in the international community that the joint declaration must be adhered to.

We want a strong and stable relationship with China—that is important to the future of the people of Hong Kong—but it must be on the basis of adherence to the terms of the joint declaration. That is the international agreement we concluded and that must be the basis for our relationship with China and Hong Kong.

Mr. John Wilkinson (Ruislip-Northwood)

The Prime Minister said that he was looking to an integrated transport strategy on the part of the United Kingdom to achieve the British contribution towards a reduction of 15 per cent. in greenhouse gases by the European Union by 2010. Can we therefore expect that, in perhaps the most congested and polluted part of the United Kingdom in terms of road transport—Greater London and the south-east of England—the Government will be investing money in improving public transport and, in particular, in London Underground, which is grievously in need of investment to which Labour committed itself during the election campaign?

The Prime Minister

The hon. Gentleman will know that my right hon. Friend the Deputy Prime Minister will make proposals in respect of London Underground in due course. Pollution in London is a big problem and that is precisely why the integrated transport strategy is the right one. Next spring, my right hon. Friend the Deputy Prime Minister will publish a White Paper on integrated transport as a whole. I look forward to its receiving the hon. Member's support and that of other Conservative Members, because that will be extremely important if we have any chance of meeting the EU target.

Mr. Phil Hope (Corby)

I congratulate the Prime Minister on his success at the summit. What progress was made on the UN funding crisis and, in particular, on the refusal of the United States to pay its contribution to the UN?

The Prime Minister

Without exaggerating to my hon. Friend, I think that I can say that some progress is being made. President Clinton is personally committed to resolving the funding crisis and it has helped enormously that the new Secretary-General, Kofi Annan, has made such a good and promising start in the reforms that he is making to the United Nations secretariat and the way in which it works. There is a general consensus that if those reforms receive the requisite degree of support and genuinely go deep and strong and make the necessary changes, the funding crisis should be resolved. We certainly want it to be resolved. It is very much in our interests that it is.

Mr. Edward Garnier (Harborough)

Since I took silk a minute or so, I think, before the Prime Minister's wife, may I suggest that he takes my advice on the employment of QCs rather than that of the hon. Member for Bolsover (Mr. Skinner)? I congratulate him on his kind remarks about his predecessor and his Government over the Rio targets. It was gracious of him to acknowledge that. As I think that he represents a partly rural constituency, as I do, will he ensure that nothing that the Government do in seeking to achieve environmental targets damages the rural economy or the ability of our farmers and other rural residents to make a living and thrive in the modern economy?

The Prime Minister

I thank the hon. and learned Gentleman for his kind words about my remarks. I believe that achieving those environmental targets will not damage the rural economy at all. Indeed, properly done, they should help it, since farmers and those living in rural communities would perhaps benefit as much as anyone from a better transport system and, of course, people in rural communities will particularly benefit from greater energy efficiency.

The only way that we will make this argument on the environment work is when people cease to believe that it requires some sort of sacrifice of their interests and recognise that it is in everyone's collective interest that we make the changes to the environment that are plainly and obviously necessary.

Mr. Michael Clapham (Barnsley, West and Penistone)

Did the G8 discuss during the session on international crime ways and measures to prevent child pornography?

The Prime Minister

We did not discuss that specifically and I do not believe that it was specifically referred to in the communiqué, although the subject was raised at the European Union summit in Amsterdam, where suggestions were made as to how we can co-operate on such issues. It is important that we do so. In general terms, there was a reference in the communiqué to different types of organised crime. On paedophiles, one of the most worrying aspects is that there is some evidence that that crime is happening on an organised basis across national boundaries. Perhaps that is something which we can study in the run-up to the Birmingham summit next year.

Sir David Madel (South-West Bedfordshire)

What the Prime Minister said on green issues at Denver will considerably affect the car industry and employment unless those matters are handled carefully. I remind the Prime Minister of the extreme anxiety on the Benches behind him when Ford threatened the production of the Escort at Halewood. The thing to do is to change the tax system so that car manufacturers are encouraged to produce more fuel-efficient and pollution-free engines. That is the way to guarantee jobs and satisfy environmentalists.

The Prime Minister

I agree that incentives have a role to play, although I cannot comment on any particular taxation proposals. Most people accept that it will be a matter of choice whether people use their cars. We should try to give them a better choice than they have at present. There are plenty of people who, in certain instances, would use public transport if it were there and available to them. The evidence from abroad as well as here, in certain instances, is clear.

I agree that this has to be done in co-operation with the car industry. That is absolutely essential. The hon. Gentleman will remember that when the debates about catalytic converters and unleaded petrol were taking place, the car industry came on side after a time to help develop those initiatives and they were successful. I commend to him the speech on the environment and business made by John Browne, the head of British Petroleum, a few weeks ago. He will see from that that many people in business see environmental measures as having a positive effect on business, not a negative one.

Mr. Ted Rowlands (Merthyr Tydfil and Rhymney)

I welcome the acknowledgement that limitation of arms and military expenditure in sub-Saharan Africa is extremely important. Were there any specific proposals to achieve it?

The Prime Minister

The initiative is one which I announced in relation to our own programmes. As the money is allocated, my hon. Friend will be able to see the conditions on which the aid is given. We are anxious to ensure that the money is spent on education, health care and sanitation; it is important that we ensure that no aid is being siphoned off into what is effectively military expenditure. He will see that developing. On the multilateral side, we intend to carry on working with other countries to get those principles accepted by them, too.

Mr. Graham Brady (Altrincham and Sale, West)

Does the Prime Minister agree that it is vital that we seek to move freight from roads to railways? Will he join me in congratulating the privatised rail industry on the measures that it has taken to encourage that process?

The Prime Minister

I am happy to congratulate anyone who contributes to solving the problem. My right hon. Friend the Secretary of State for the Environment, Transport and the Regions is in touch with the rail operators at the moment, to consider how they can help to make the system more integrated. One of the worries that people always had about privatisation was that it would break up and fragment a unified system. It may be possible within the existing system to try to mitigate some of those problems. That is precisely what we want to work on. If the rail operators help us to achieve that, I shall be the first to congratulate them.

Mr. Barry Sheerman (Huddersfield)

I congratulate my right hon. Friend on the stand that he took on the environment. I am sure that at Denver he spoke of the link between solving the problems of the environment and jobs and employability. Will he ensure that we in this country start to make that link? I am sure that he has seen the dispiriting league table showing that the investment record of the private sector over the past year was down yet again under the previous Government. If we are to tackle the environment and make jobs out of tackling it, we must lead in research. I hope that my right hon. Friend will lead a crusade on that.

The Prime Minister

I can certainly assure my hon. Friend that we will make the link between jobs and employability and the environment, as we recognise that it is important to do so. Recent estimates by independent international organisations suggest that environmental technology could be one of the growth areas in employment over the next few decades.

It is tremendously important that we also recognise that those companies with the most advanced technology, capable of producing greater energy efficiency, are among the most successful anywhere in the world. Companies find that if, for example, they introduce proper measures for waste recycling, and engage properly with energy efficiency, they not only contribute to the overall impact on the environment of business but reduce their costs. It is extremely important to make the connection, and we will certainly do so.

Mr. James Clappison (Hertsmere)

I welcome the Prime Minister's frankness in acknowledging that the previous Government's policies, such as the energy efficiency best practice programme and the home energy efficiency scheme, enabled this country to be one of the minority of developed nations that met and surpassed their targets on greenhouse gases. Does he favour a switch to coal-fired power stations?

The Prime Minister

On the latter point—as the hon. Gentleman knows, because we agreed with it when it was the previous Government's policy—I favour a balanced energy policy. We have been perfectly happy all the way through to agree on the energy efficiency measures that were introduced under the previous Government and which we will develop. Indeed, the environmental task force will be a development of existing policies.

In respect of renewable energy, we are encouraging the greater use of solar energy and wind power, particularly through the non-fossil fuel obligation, which encourages power suppliers to make use of renewable energy sources. We will introduce a Bill to ensure that the levy continues, as it would otherwise expire next year. I am perfectly happy to accept that good work was done before; it was done with the Labour party's consent and we look forward to developing it further. If that can be done on the basis of political agreement, so much the better.

Mr. Peter L. Pike (Burnley)

I welcome everything that my right hon. Friend the Prime Minister said about the conditions for giving overseas aid, but is it not vital that we recognise that developing nations have so much poverty, on scales that we can hardly envisage, to eliminate that they sometimes find that the less environmentally advantageous way is the easy way? It is essential that overseas aid and the environment are linked, because environmental problems never recognise national boundaries.

The Prime Minister

My hon. Friend is right. That is one reason why it is important that, when we increase our aid to sub-Saharan Africa, we do so on the basis of programmes that will be environmentally beneficial as well as assisting the development of those countries. During the UN special session, we also announced measures that will assist forestry. There is a range of issues where we can link aid and the development assistance that we are giving to measures that will improve the environment. That should be read in conjunction with the measures to reduce the level of debt. For many of those countries, the level of debt is the single biggest problem that they face.

Mr. Ian Bruce (South Dorset)

On greenhouse gas reductions, the right hon. Gentleman knows that much of Europe, and certainly his party, was wedded to carbon taxes. Was that raised at the Denver summit or later at the environment summit? How did the Prime Minister persuade people that his Government were keen on reducing greenhouse gases when it is their policy to reduce the cost of domestic fuels by taking money off VAT?

The Prime Minister

We have no proposals to introduce carbon taxes and that was not discussed at Denver. We believe that the measures that we have outlined will give us the very best chance of meeting the targets that we have set ourselves. The single best thing that we can do in relation to that is to improve energy efficiency. VAT on fuel harmed a lot of people, particularly those living in poverty, who faced rising fuel bills and sometimes, in the case of old age pensioners, a choice between heating and eating in winter. That is not acceptable.

Dr. Norman A. Godman (Greenock and Inverclyde)

My right hon. Friend made passing reference to international fisheries management. Has Japan made any promise to impose tougher restraints on its tuna fishing fleet? May I remind him that that fleet has imposed severe economic damage on numerous coastal or littoral nations in the third world and that its vessels are beginning to appear in the north Atlantic?

The Prime Minister

I am not aware of any particular moves by the Japanese on international fisheries management. Perhaps I could write to my hon. Friend on the tuna fishing fleet, because I am afraid that I cannot give an answer off the top of my head.

Mr. Cynog Dafis (Ceredigion)

I understand that there will be a further statement this week on earth summit 2, but, meanwhile, could the Prime Minister tell us more about the evolving American position on greenhouse gas emissions? America is responsible for 25 per cent. of global CO2 emissions. Is it likely that the United States will agree to significant reductions in Kyoto in December? Does he agree that environmental sustainability must become a major foreign policy issue and that countries that refuse to take it seriously should be regarded as a threat to global security?

The Prime Minister

I agree that it is important that we co-operate with other countries in safeguarding the environment, which is why we have taken the action that we have. In respect of the United States, there was some progress at Denver because all the countries committed themselves to binding targets for the reduction of greenhouse gases by 2010. That is a step forward. I think that the critical time will be between now and the Kyoto conference, when I very much hope that the United States will be able to do that. I think that both the President and the Vice-President are personally sympathetic, but obviously big interests are involved, and the United States has particular problems. I am hopeful of making progress.

Mr. Michael Connarty (Falkirk, East)

Everyone commends the Prime Minister and the G7 leaders for their initiative on sub-Saharan Africa. Did they discuss indebtedness and poverty in Asia and in central and south America, where, for example, Nicaragua had, when I last read about it, the single largest debt per head of population of any country in the world? That is linked to the growth and distribution of addictive drugs such as cocaine and heroin. Was there discussion of whether policing was not enough and whether programmes were needed to lift such countries out of poverty and their dependence on growing addictive drugs?

The Prime Minister

There certainly was discussion of the debt problems of countries not only in Africa but in South America and elsewhere. There is a recognition that the problem is not by any means limited to Africa. There are programmes in place that encourage development of the economies of indebted countries and reduce their dependence on the production of drugs. Part of the discussion this week in New York at the UN special session will be on how to intensify those programmes and make them more effective.

Mr. Matthew Taylor (Truro and St. Austell)

While I am sure that the Prime Minister is right to be critical of those industrial countries that have done little or nothing on CO2 emissions, does he agree that it is vital that we press ahead and do the most that we can for both our own environment and the global environment? Will he make it clear that there is no truth in the interpretation that has been put on the comments of some Ministers that Britain will stick to the new Government's 20 per cent. target for cuts in CO2 emissions only if other countries co-operate in cutting their emissions? Will he confirm that our target is not conditional on the action of others?

The Prime Minister

It is not a conditional target, but the truth is that it is much easier for us to meet it if other countries are moving in the same direction. That is in a sense a statement of the obvious.

I believe that there is a general will in the European Union to make progress. It is possible that by Kyoto we will get a better deal than anything that is on the table now. Under the measures that we are taking now, we will achieve a 10 per cent. reduction by the year 2000 of 1990 levels. That is well in line with what we can then do to achieve our target. It is possible to do this by taking measures that are sensible in any event, but it is obviously easier if other countries are also taking such measures.

Mr. Barry Jones (Alyn and Deeside)

With regard to the Prime Minister's welcome remarks on employment, how soon does he think that we can see more long-term unemployed, and the army of unskilled unemployed, placed in meaningful employment? My right hon. Friend will know that that is a matter of urgent interest in Wales, for example.

The Prime Minister

I hope very much that we can make a start on that as soon as we have provisions in our programme, such as the windfall tax, in place. There was a strong recognition among all countries that structural unemployment—people are sometimes unemployed through generations—is a problem which we all have a responsibility to tackle in our countries. Many of the problems relating to crime and social disorder stem from structural unemployment.

Mr. Alan W. Williams (East Carmarthen and Dinefwr)

Britain has a good record on reducing carbon dioxide emissions, but does my right hon. Friend acknowledge that much of it is due to low economic growth in the early 1990s and, more especially, the dash for gas in the past few years? I agree with the 20 per cent. target by 2010, but it is set against 2.25 per cent. per year economic growth, which is a compound 50 per cent. increase in living standards. To use 20 per cent. less energy will entail a 50 per cent. increase in energy efficiency. We are setting ourselves demanding targets, which may mean hard choices.

The Prime Minister

It can be said that the progress that we have made is in some part governed by the low levels of economic activity in the years immediately following 1990, but we are on course to meet the target in 2000—10 per cent., at least half of the total—with projections of growth of more than 2 per cent. per year. I believe that it is well possible to do it. Yes, it will require a real seriousness of intent, but we have only scratched the surface of the possibilities of energy efficiency. There is an awful lot more that can be done and which we will do.

Mr. Neil Gerrard (Walthamstow)

In relation to the money agreed for restoring the sarcophagus at Chernobyl, was there specific agreement on a time scale for that to be done? As we know that in Russia and other parts of the former Soviet Union there are other nuclear power stations that have the same sort of outdated technology and pose the same potential dangers as Chernobyl, what discussion was there on what could be done to prevent another Chernobyl in the future?

The Prime Minister

My hon. Friend is absolutely right to raise that point. A significant part of our discussion was devoted not only to the problems of the remaining reactors at Chernobyl, but to other outdated nuclear reactors. Of the money that has been pledged, the European Union's share will come principally from the TACIS programme—technical assistance to the Commonwealth of Independent States—but there will be a small bilateral contribution from Britain spread over a number of years. That is absolutely essential if we are to reach the target date of closing Chernobyl by 2000.

There is a great sense of concern that it is important that we move ahead in this matter, and the memorandum of understanding that we reached with Ukraine will be tremendously important in that respect. We will make progress, but I have to say that it was one of the most concerning aspects of our discussions, because there is still an awful lot that needs to be done.