Hong Kong Bill

HL Deb 19 February 1985 vol 460 cc481-508

3.10 p.m.

The Minister of State, Foreign and Commonwealth Office (Baroness Young)

My Lords, I have it in command from Her Majesty the Queen to acquaint the House that Her Majesty, having been informed of the purport of the Hong Kong Bill, has consented to place her prerogative and interests, so far as they are affected by the Bill, at the disposal of Parliament for the purposes of the Bill. I beg to move that this Bill be now read a second time.

The Bill before the House today is short and, I hope, relatively straightforward; but it is one of great significance. It provides for the termination on 1st July 1997 of British sovereignty and jurisdiction over Hong Kong and on that date will sever the links of government between the United Kingdom and Hong Kong which were first established some 150 years ago.

The House had an opportunity to debate the agreement which this Bill is designed to implement on 10th December. On that occasion the House overwhelmingly approved the Government's intention to sign the agreement. The Government were much encouraged by the strong support given to the agreement by all quarters of your Lordships' House. Later in December, my right honourable friend the Prime Minister, accompanied by my right honourable friend the Foreign and Commonwealth Secretary visited Peking, where the agreement was signed on 19th December.

In our debate on 10th December there was, I think, general acceptance that the agreement was a good one. In the Government's view, it does indeed provide a satisfactory framework in which Hong Kong will be able to preserve its economic system and way of life after 1st July 1997 as a Special Administrative Region of the People's Republic of China.

Some noble Lords quite rightly raised in the debate concerns expressed by some people in Hong Kong about certain aspects of the agreement. These concerns were also fully documented in the Assessment Office report. The Government have them firmly in view. We are doing and shall continue to do our best to reassure those who are worried about this or that aspect of the agreement. We shall also continue to bear these concerns in mind in our future discussions with the Chinese Government, particularly in the joint liaison group.

During their visit to Peking my right honourable friend the Prime Minister and my right honourable and learned friend the Foreign and Commonwealth Secretary were able to raise a number of these points with very senior members of the Chinese leadership. The latter assured us in unequivocal terms of China's commitment to the full implementation of the agreement and of China's intention to consult Hong Kong opinion on a wide basis about the drafting of the Basic Law.

Finally, before I move on to the Bill itself, I know that many noble Lords will be glad to know that the Government have agreed, as a result of representations from all parties, to produce an annual report on Hong Kong and to lay it before Parliament. The exact form of that report has not yet been decided, and the matter will be discussed further with the Governor of Hong Kong. But the report will probably include a general account of developments in Hong Kong during the preceding year. I am quite certain that this House will maintain its interest in Hong Kong and commitment to the people of that territory, and I am sure that we shall be debating various aspects of its future on many occasions in the coming years.

Following the signature of the agreement, the Governments of both China and the United Kingdom have to satisfy their constitutional requirements in order to ratify the agreement. The purpose of the Bill before us today is to enable Her Majesty's Government for their part to ratify the agreement.

The central provision of the Bill is Clause 1. This provides for the termination of British sovereignty over the ceded parts of Hong Kong and the termination of British Jurisdiction over the whole territory with effect from 1st July 1997. The clause will enable the Government to meet their obligation under paragraph 2 of the Joint Declaration in which the Government of the United Kingdom declare that they will restore Hong Kong to the People's Republic of China with effect from 1st July 1997. The clause will enter into force on the exchange of instruments of ratification.

In recent years, the Government have, when divesting the United Kingdom of sovereignty over a dependent territory, done so upon the authority of an Act of Parliament. Hong Kong's case is, of course, somewhat different from that of other dependent territories, but the Government still need the authority of an Act of Parliament before they ratify the agreement and thus create an international obligation to terminate sovereignty.

The schedule to the Bill deals with three aspects relating to the agreement and the termination of sovereignty. They are, first, changes in British nationality laws necessary as a consequence of the agreement and the associated exchange of memoranda with the Chinese Government; secondly, amendments to British laws in preparation for or consequent upon the termination of United Kingdom sovereignty and jurisdiction; and thirdly, the provision of diplomatic privileges and immunities to the five Chinese members of the Joint Liaison Group.

Paragraph 2 of the schedule deals with nationality. The purpose of this paragraph is to enable the Government to make the nationality provisions necessary as a consequence of the United Kingdom ceasing to have sovereignty or jurisdiction over Hong Kong in 1997, and to fulfil the commitments made in the United Kingdom memorandum which was presented to the Chinese Government when the agreement was signed. It enables a subsequent Order or Orders in Council to be made to ensure that British Dependent Territories citizenship cannot be acquired or retained on or after 1st July 1997 by virtue of a connection with Hong Kong and to create a new form of nationality which may be acquired before that date by persons who are BDTCs by virtue of such a connection.

I should now like to say a word about the proposed procedure. It may be helpful if I explain briefly why we have adopted the Order in Council route. There are two considerations. The first is that, as we see it, it is right that this Bill should lay the groundwork for all the legislative activity arising from the agreement. The measures contained in the Bill arise directly out of the agreement and the United Kingdom memorandum. They were an integral and essential part of the package which was negotiated with the Chinese Government. They were also a vital part of the arrangements which the people of Hong Kong decided were acceptable for the termination of British sovereignty in 1997. If they were not covered in the Bill this would raise considerable uncertainty in Hong Kong, and perhaps doubt about whether we intend to live up to our promises. This would be very damaging.

The second consideration was that in order to meet the timetable for ratification—that is by 30th June 1985—it was necessary for the Bill to be put to Parliament very early in the New Year. This left insufficient time to draft the unavoidably complex legislation which will be necessary, and to carry out the necessary consultations in Hong Kong. Both drafting and consultation are now taking place, though they are at a relatively early stage. The Government have undertaken to bring an order before the House as soon as possible, and at the latest within a year of the passage of the Bill into law.

The Government recognised that the House would wish to know the main parameters of the proposed legislation. For this reason, the framework for the subordinate legislation is clearly stated in the schedule to the Bill. The order will make provisions for the removal of Hong Kong from the list of dependent territories in Schedule 6 to the British Nationality Act 1981 with effect from 1st July 1997. It will also provide for the acquisition of a new status to be known as British National (Overseas) by persons who are, on 30th June 1997, British Dependent Territories citizens by virtue of a connection with Hong Kong. The order will define clearly to whom these provisions will apply.

The new title was announced in the debate on the Second Reading of the Bill in another place. I am glad to be able to report that reactions in Hong Kong to the new title were generally favourable. As a result of this, an amendment was introduced into the Bill at the Committee stage in another place to incorporate the title of the new form of nationality into the Bill.

It was not easy to devise a title which meets all the necessary requirements. On the one hand, it needs to make clear that we are dealing with a form of British nationality. Nothing else would be acceptable in Hong Kong. On the other hand, it is essential that the title can be used after 1997 and therefore that it carries no implication of a continuing constitutional relationship between Britain and Hong Kong after 1997. The title "British National (Overseas)" meets both these criteria.

It is the Government's intention that the British National (Overseas) status should carry broadly the same benefits as British Dependent Territories citizenship, except that it will not be transmissible by descent. Holders of the new status will be able to use British passports. They will be eligible for British consular protection in third countries. They will have a right to registration as British citizens on the same terms as BDTCs. They will not enjoy benefits that are not conferred by BDT citizenship, such as the right of abode in the United Kingdom. The Government realise the importance of ensuring international recognition of the new passports and have undertaken to make every effort to explain the new arrangement to third countries. This will be done between the enactment of the Order in Council and the issue of BN(O) passports. Given the clear indication of the right of abode in Hong Kong that will appear in the new passports, there should be no reason for third countries to introduce new restrictions on entry of BN(O) passport holders.

The order will also deal with the question of statelessness. The Government have clearly stated their intentions that no former Hong Kong BDTC, nor any child born on or after 1st July 1997 to such a person, should be made stateless as a result of the arrangements envisaged in the Bill. All former Hong Kong BDTCs will be able to acquire BN(O) status, if they wish, before 1st July 1997. If they do this, they will retain it for the rest of their lives. Any BDTCs who do not acquire BN(O) status and would otherwise be stateless—for example, if they are not Chinese nationals and hold no other nationality—will become British overseas citizens on 1st July 1977. The children born on or after 1st July 1997 to former Hong Kong BDTCs who are Chinese nationals will of course have Chinese nationality. Children born to non-Chinese former BDTCs will acquire British overseas citizen status at birth if they would otherwise be stateless. The House will be given full opportunity to discuss these detailed proposals when they are put forward in the form of an Order in Council.

Paragraph 3 of the schedule deals with the modification of United Kingdom Acts and subordinate legislation. It gives the necessary powers to make changes in British law in consequence of, or in connection with, the ending of sovereignty. This paragraph enables Orders in Council to be made to repeal or amend United Kingdom legislation insofar as it is a part of the law of Hong Kong; to enable the legislature of Hong Kong to repeal or amend United Kingdom legislation insofar as it is a part of the law of Hong Kong, and to legislate with extra-territorial effect; and to repeal or amend British legislation which relates to Hong Kong.

Such provisions are normal when this country ceases to have sovereignty over a territory. They are written into independence Acts, and although this Bill is of course different from an independence Bill, a similar provision is necessary. It would of course be inappropriate to continue after 1997 to have references in the laws either of Hong Kong or of the United Kingdom implying the continuation of a constitutional relationship with the United Kingdom.

More importantly, since the agreement provides that, broadly speaking, the laws previously in force in Hong Kong will continue in force after 1997, it is important that Hong Kong should by then have a body of laws which can stand on its own, quite separate from United Kingdom law. The vast majority of orders that will be necessary under paragraph 3 of the schedule will make largely technical amendments connected with the termination of sovereignty and jurisdiction. A large part of the statute book will need to be scrutinised before we can be sure of the total number of orders that will need to be made. There are, however, likely to be during the next 12 years a very large number of such amendments, most of which will be very technical. It is for this reason that the Government have proposed the negative resolution procedure.

Finally, paragraph 4 of the schedule accords diplomatic privileges and immunities to the five Chinese members of the Joint Liaison Group who will attend those meetings of the group which will take place in London. This is designed to meet our obligations under Annex II of the Joint Declaration, which provides for the creation of a Joint Liaison Group of five British and five Chinese members to meet in London, Peking and Hong Kong. Paragraph 10 of that annex provides that: members of the Joint Liaison Group shall enjoy diplomatic privileges and immunities as appropriate when in the three locations". This section of the Bill therefore accords diplomatic privileges and immunities to the five Chinese members of the group who attend meetings of the group in London. Existing legislation would not cover this rather unusual category of representatives, and we therefore need to legislate specifically to cover their case.

As my right honourable and learned friend the Foreign and Commonwealth Secretary said in another place, the signature of the agreement and the passage of this Bill represent the beginning of a process and not the end. There is much to be done between now and 1997. It will require the closest co-operation between ourselves and the Chinese Government. It will also require the closest consultation with the people of Hong Kong.

The situation in Hong Kong is not static. The Government of Hong Kong are moving ahead with the progressive strengthening of representative government in the territory over the next 10 years. The first elections to the Legislative Council will take place in September this year and there will be a further review of the electoral process in two years' time. We, for our part, are moving towards the establishment of the Joint Liaison Group provided for in Annex II to the Joint Declaration. We will need before long to discuss with the Chinese Government the practical arrangements for its creation and other aspects outlined in Annex II. As soon as there is anything to announce in this respect the Government will of course inform the House.

We need to move forward rapidly to ratify the agreement. Paragraph 8 of the Joint Declaration provides that ratification shall take place before 30th June 1985. The Government believe that the early ratification of the agreement will further reinforce confidence in Hong Kong, which has, I am happy to say, already been visibly strengthened by the agreement. I commend to the House this Bill which will enable the Government to ratify the agreement. I beg to move.

Moved, That the Bill be now read a second time.—(Baroness Young.)

Lord Davies of Leek

My Lords, before the noble Baroness sits down, may I ask her a simple question? Within the parameters which she has declared, excellently, to the House, can she tell me about the position of the Indian citizen, which seems to need to be taken up—

Baroness Trumpington

My Lords, I think the noble Lord is out of order in speaking at this moment.

3.26 p.m.

Lord Cledwyn of Penrhos

My Lords, we are grateful to the noble Baroness for her explanatory speech on this historic Bill. As the House knows, our attitude on this side is one of general support, and we hope that the agreement, now signed by Britain and China, will operate to the benefit of the people of Hong Kong. We had a long and constructive debate on the agreement on 21st January, and I do not propose to cover the same ground again save to say that I strongly recommended an annual report on Hong Kong between now and 1997. I drew attention to the analogy of the annual Welsh report, which was always followed by a full day's debate in another place, and which was always, if I may say so with due modesty, invariably a success.

The noble Baroness has confirmed that the Foreign Secretary has now decided to publish a Hong Kong report, leaving the timing of debates to the usual channels and the wishes of the House. We warmly welcome this announcement because we are conscious that the way in which Hong Kong adapts itself to the requirements of the agreement by 1997 is of vital importance; and the fact that Parliament will be kept informed annually for the next 12 years will, in my view, help Hong Kong significantly along this road towards the transfer of sovereignty.

Mr. Richard Luce, in another place, said that the form of the report has not yet been decided, and the noble Baroness confirmed that today. But we hope that it will be as comprehensive as possible, showing what progress is being made in various fields such as education, health, housing and social services, as well as the extension of democratic institutions like the new Regional Council which is to be established to cover the needs of those areas at present under the aegis of urban councils. The British Government remain responsible for Hong Kong until 1997 and will be responsible in part for ensuring that this agreement works. This is why the annual report to Parliament will be of crucial importance.

It was clear from the outset that the question of nationality would be the most difficult and sensitive problem. The schedule to the Bill, which deals with this, must be considered very carefully, as the noble Baroness has indicated. The title of the new form of nationality to which she referred—namely, British National (Overseas)—appears to be acceptable to the Hong Kong Executive Council and to everyone else, and we are glad that the Government have now written it into the Bill itself.

The Government's original intention that any amendments to nationality legislation should be made a routine Order in Council ran into immediate difficulty in another place. I am very glad that the Government decided to recognise the strength of the arguments advanced by my right honourable and honourable friends and others. The point was that such an order, debated under the affirmative procedure, could not be amended, and the debate would also be restricted, as we know, to one-and-a-half hours.

This is, in fact, a significant step because it is the first time that Parliament has created a new nationality by means of an Order in Council alone. The British Nationality Act 1981 created a number of new nationalities, and we well recall that it was extensively debated and amended in both Houses. An Order in Council does not have quite the same "aspect of permanence" as an Act of Parliament. We therefore warmly welcome the Government's decision to allow a preliminary debate on the draft order. It was described in another place as an order with "green edges" and it can thus be scrutinised, opposed or rejected before the final order is brought forward. I should be grateful to the noble Baroness if she would confirm that any such draft order will be debated in this House as well. The noble Baroness was not absolutely clear on that point.

I realise that we shall be debating Orders in Council in this House in the usual way. However, I hope that we shall also be given the opportunity now to be afforded to the other place to debate the preliminary order without any limitation of time, so as to enable the Government, if they believe that there is a strong body of opinion in the other place and, it is to be hoped, in this place, to amend or change the order. I shall be grateful, therefore, if the noble Baroness will confirm that we are to have the same privileges as the other place in this regard.

There are other matters of importance which I should like to mention briefly. First, there is the natural concern about the nature and scope of the Basic Law to which the noble Baroness referred. Of course we recognise that this is primarily a matter for the Chinese Government. As the Foreign Secretary made clear on 21st January, China has indicated that it would, nevertheless—although the Basic Law is its primary concern—wish to know the views of the people of Hong Kong, and that some form of consultation with them will take place. I believe that this will be very helpful to all the parties—to China, to Hong Kong and to ourselves—because it will create confidence. I wonder whether the Government have any up-to-date information as to how the consultation may develop?

Secondly, the Joint Liaison Group needs further elaboration. Smooth progress towards transition will depend very largely upon the work of this group and we are interested to know more about its composition and other details about its operation. We understand that the Foreign Secretary has been discussing these matters with the Governor recently, and perhaps the noble Baroness can give us some information about the outcome of these talks.

Thirdly, I understand that the Chinese Government agree that Hong Kong should continue to remain a member of those international organisations which are essential to her future as a great financial and commercial centre—for example, the GATT, the multi-fibre arrangement and others—when she finally comes to be united with the Republic of China.

May we be told by the noble Baroness what progress is being made in obtaining the agreement of the other parties to Hong Kong's continued membership? Hong Kong's participation in these international activities does, of course, lie at the very heart of the agreement. What we are all seeking to achieve is the survival of Hong Kong's tradition and those qualities which have made Hong Kong great. This was made clear by the Governor of Hong Kong, Sir Edward Youde, in his lecture at the Stock Exchange on 22nd January. Two paragraphs of his lecture are, I believe, well worth quoting in this debate. He said: In recent years Hong Kong has added a new string to its bow in the shape of a financial centre of world standing, third after London and New York. We now have about 140 licensed banks, of which 35 are local companies. Over 100 other foreign banks maintain representative offices in Hong Kong. The financial and ancillary services sector employs about 170,000 people. Our claim to be a major international financial centre is well-founded". He went on: Hong Kong's impressive economic growth owes much to the open nature of its economy. The Hong Kong Government is, and will remain, non-interventionist by nature. Its characteristic economic policy has been deliberately to leave the industrial, commercial and financial sectors free and unfettered to compete in domestic and world markets. The Government has sought to regulate only where the orderly conduct of business, fair treatment of the workforce and the good name of Hong Kong so require". It is that spirit which we hope will survive the union of 1997.

The Governor also pointed out that the 500 factories in Hong Kong are fully or partly owned by overseas interests, and there is no doubt that the confidence of overseas investors has been reinforced by the agreement; but it is also significant that Chinese investment in Hong Kong has increased dramatically so that China is now second only to the United States as Hong Kong's trading partner. This is why Hong Kong's continued membership of international organisations is so vital to its future.

Another subject which has caused concern is the validity and international acceptability of the new passports, to which the Minister also referred in her speech. We could not expect the noble Baroness or the Government to give absolute guarantees at this stage, but I think that some assurances would be helpful to the House. A number of questions were raised in the debate in the Legislative Council on 5th February, including the subject of passports. I am sure that noble Lords will have read the response that the Chief Secretary, Sir Philip Haddon-Cave, gave to this and the other matters which still cause some concern.

The noble Baroness told us about the action that the Government are taking to ensure that the new BN(O) passport will be accepted by immigration officers internationally. Can she say if the holders will be able to enter the United Kingdom without visas; that is, will they enter and depart without restrictions? Another point which requires clarification is the precise position with regard to identity cards. As the noble Baroness will be aware, there has been a good deal of apprehension and discussion about this matter in Hong Kong itself. The Chief Secretary has drawn attention to Section XIV of Annex 1 to the Sino-British Joint Declaration which provides for the holding of permanent identity cards to be stated in the future BN(O) passports as evidence of right of abode in Hong Kong, and has said that Her Majesty's Government would be discussing with the Chinese authorities the wording of the statement with a view to ensuring that BN(O) passport holders would not have to produce their identity cards for immigration clearance. That is a very important point for the holders.

I understand that the objective will be to ensure that, after 1997, a BN(O) passport holder will not need to produce an identity card in addition in order to establish right of abode in Hong Kong. I assume that the Government will talk to the Chinese Government about this matter, because the whole exercise can become fraught with great complexity. The simpler the arrangement, the better, and I am sure that that is something with which the noble Baroness would agree. I appreciate also that she cannot go into precise detail in advance of discussions with the Chinese authorities, but some broad indication of the Government's thinking would, I believe, be of assistance to the House at this time.

Another difficult area is that of the so-called "stateless persons", most of whom are of Indian and Vietnamese origin. I think that this is the problem which was raised by my noble friend Lord Davies of Leek. In the debate on 5th February the Chief Secretary stressed that: There would be no question of statelessness among those who were Hong Kong BDTCs on 30th June 1997 or among children born to them after that date". They would be eligible for BN(O) status or would acquire British overseas citizenship. He also made the significant point that, it was a long-standing view of Her Majesty's Government that it was not appropriate, as a general principle, to grant British nationality indefinitely and without restrictions to the descendants of British nationality". I note that Mr. Richard Luce repeated that in the debate in another place on 6th February. I believe that this is an area of some uncertainty which causes great concern to many, including the 5,000 people of Indian origin in Hong Kong. Perhaps when the noble Baroness winds up the debate she will help to clarify that point.

I hope I have referred to the main issues which require further elaboration. I recognise that some of them will not become entirely clear until further discussions and negotiations have taken place, especially with the Chinese authorities. May I also repeat my appreciation of the important concessions made by the Government since we last debated the matter.

At the end of the day, everything depends on the way in which matters develop over the next 12 years. As the noble Baroness said in her speech, the situation is not a static one. A great responsibility rests on the parties—on the British Government, which will remain in control for 12 years; on the Government of Hong Kong; on the Legislative Council; on the Joint Liaison Group; and, of course, on the Government of the Republic of China. I think that this is an experiment unique in history, and its success depends on the integrity and the good will of all the parties concerned. It is against this background that we wish this Bill a speedy passage through Parliament.

3.41 p.m.

Lord Beaumont of Whitley

My Lords, this is an historic moment in the history of the Commonwealth, and particularly of Hong Kong. So far, we are extremely grateful to the noble Baroness for her lucid exposition of the Bill; and I, personally, have also been very interested to hear a leading Socialist give such a fine exposition of vehement support for the continuation of capitalist activities in Hong Kong.

When I made my maiden speech in your Lordships' House some 18 years ago, like many of your Lordships I was advised by my elders and betters to make it in the course of one of the more general debates. But, ever contrary, I chose to make it in the debate on an Unstarred Question on primary education in Hong Kong, largely because I was proud—as I still am—to belong to a House which can provide experts on practically every subject in the world, and I reckoned that I was probably the only Peer who had been chairman of the board of governors of a primary school in Hong Kong.

Now, all this time later, I can no longer claim exclusive expertise, and all my first-hand knowledge is out of date; but, in common I suspect with almost everyone who has lived and worked in that extraordinary colony, I have a lingering affection which comes to the surface as we prepare to write the last act of Britain's proprietorship of that island and her leasehold over that area of the mainland, the English-speaking Anglican inhabitants of which had the misfortune to have me as their vicar—shortly, incidentally, after I had emerged from the tutelage of the right reverend Prelate the Bishop of Birmingham, to whose contribution we look forward this afternoon.

As with all our colonies, our record in Hong Kong is extremely mixed. Greed and the infamous history of the opium trade mingles with our, on the whole, not ignoble efforts to deal with the refugee problem, with the relative uprightness of our administration, and with the saintliness of men like the iconoclastic Bishop R.O. Hall and women like Mildred Dibden with her orphanage, which took in the poor and helpless and turned out so many of them as sterling citizens. If I may say so, Bishop Hall in particular has had a long way to tread from the time he first arrived in the colony and had to take the revolutionary step of asking that Chinese archdeacons should come to the front door when they called on him and not to the back, as had previously happened.

Of course, we all knew that the stage which we have now reached was inevitable, and, indeed, many of us looked forward to it, knowing that colonialism, even at its best, is no better than a necessary evil; but, equally, we have had fears for the people involved. Not all of those fears have been set at rest by any means, but we should at least be thankful that the prospects are as bright as they are.

We must congratulate the Government on their handling of the situation. With the exception of one disastrous press conference, they have done a fine job. But, of course, the primary praise so far must go to the Chinese Government, which, with all the cards in their hand, have come to an amicable and fair arrangement. I know that it is early days yet, but it is right that we should speak as we see the situation now. In talking of the Government's action, I should like to thank them for, and congratulate them on, their agreement to produce an annual report. That is indeed welcome.

On these Benches, of course, we cannot feel entirely happy at the thought that we are handing over 5 million people to another Government without consulting them. It is hardly a Liberal procedure; but we must accept the situation as we find it, and we wish to concentrate as far as we can on doing the best we can for the people involved. My noble friend Lord Kennet, who had hoped to be able to take part in the debate this afternoon but who is unable to do so, has put our aim most clearly when he has stated on a number of occasions that our object must be to ensure that no one suffers any greater hardship or deprivation by the handing over than he or she would if we were still responsible.

That, of course, particularly applies to the arrangements for nationality and citizenship after transfer, and I think that we have a special duty to look at any minorities who find themselves in an anomalous position. The ethnic Chinese will, willingly or not, be reunited with the great majority of their race. The British can come back here. It is the others to whom we must particularly look. Among them are the Indians, the boat people and the Eurasians. Some of them, such as the boat people, have already suffered; others, such as the Indians, have a history going right back to the foundation of the colony.

I should also like to speak particularly about the Eurasian community. Over half my congregation came from that community, and I grew to have a great affection for many of them together with a gratitude for how they put up with me. Many of them fought and suffered for the colony and the Commonwealth, particularly in the last war after the fall of Hong Kong. They are a body of citizens who may not be personae grata with the Chinese authorities, and I believe that there is no other major Eurasian community in China. Undoubtedly, whatever happens in the future, we must continue to keep a watching brief on what happens to members of that community.

On 6th February in another place Mr. Luce, in a helpful reply during the Committee stage, stated that questions dealing with provisions for these groups were being looked at urgently. Since then we have already had some clarification, and perhaps we shall receive even more information from this debate.

I have two specific questions which I should like to put to the Government. Section 14 of Annex 1 to the agreement states that Indians who have certain qualifications, such as seven years' residence in Hong Kong, will have the right of abode in China but not the right of citizenship in China. This failure to offer citizenship, although understandable, has given rise to fears—and genuine fears—that the whole of this provision might be abrogated in the future. We have bitter memories, particularly on this side of the House, of what happened to Asians who were left in East Africa after the assurances that they had received before we pulled out.

We must make certain that if anything like that should possibly happen—and we hope that it will not—there is a safeguard against it. If that were to happen, I understand that it is the considered opinion of experts that, under international law, such people would have a right of abode in the United Kingdom. I should like some assurance from the Government that they take this point and confirm that ruling. Secondly, Chinese citizenship will be offered to those of Chinese origin. I should like to ask how narrowly or widely is this defined, and whether it will include Eurasians, and how in fact that particular problem would be settled.

Those are the questions I want to ask from these Benches; but lastly I have one personal suggestion to put. It is not a suggestion from my party or from the Alliance, nor, I suspect, would it be right for it to be part of any legislation, nor necessarily for it to be dealt with by any of the Government's answer to this debate, because we are concerned here today with rights, and that is our job as legislators. My suggestion deals with matters of grace, or supererogation; matters extra to rights.

There are a number of people in Hong Kong whom our Monarch has from time to time delighted to honour. In every case we may, I think, say that the honours have marked outstanding contributions to the community, and certainly the publication of the Honours List in Hong Kong has always been a matter of great interest and of much enthusiasm. Such people, I suggest, whom we have honoured, whom the Queen has honoured, have deserved some British rights to reside, if they should so choose; or if not rights, they have deserved to be given the opportunity.

The bureaucratic answer will be, "No"; I know that. There are no precendents, and such an action would muddle the issues. It would not be consonant with the whole tenor of the honours system, etc. The political answer might also well be, "No". The people themselves may well be reluctant to ask to be a special case. But the party which forms the present Government prides itself, as I understand it, on a warm-hearted recognition of patriotism and service. So do the rest of us; but it is something which they—possibly quite rightly—claim to themselves.

It would surely be churlish if, for instance, members of the Most Honourable Order of the British Empire were to find themselves unable to reside anywhere within it and were the unwilling subjects of a great power which might hold their previous honours against them. On this point I ask for no reply, but merely that the politicians and civil servants concerned should mull it over and, if necessay, raise it at the highest level. I cannot believe that such a suggestion would not be sympathetically considered at the very highest level.

I return to the main work of this Bill. We have a duty to see that we do the best for the people of Hong Kong, as we have tried to do in the past. We on these Benches, we on this side of the House, know that the Government are doing their best to achieve a just and satisfactory settlement. There are certain outstanding questions, and there will probably be more as the years go by. We are grateful to the Government for what they have achieved so far, and we look forward to helping them to tidy up the loose ends and to make this a satisfactory and an honourable end to a distinguished chapter of Commonwealth history.

3.54 p.m.

The Lord Bishop of Birmingham

My Lords, St. Paul wrote to Christians in the Roman colony of Philippi, "Our citizenship is in heaven". But if their spirit was in the heavens, their bodies were very much on earth—and the same holds good for the inhabitants of the British colony of Hong Kong. Earthly citizenship means that we belong to a country; we have inalienable rights. It is a matter of identity, and it affects our self-esteem, our rights, our inmost being.

At Philippi, Paul, after he had been beaten up by the authorities, took pleasure in informing them that he was a Roman citizen. "I am a citizen of no mean city", he said when he was arrested. The chief captain said, "I bought my citizenship with a great sum of money"; but Paul said, "I am a Roman born". Because he was a Roman citizen he was able to appeal to Caesar. But, as I understand it, the new class of British citizen whom it is proposed to inaugurate will not have an equivalent privilege.

St. Paul put great value on his earthly citizenship, and, indeed, citizenship is very important to all of us. It is for this reason that I should like to draw attention to some of the provisions of the Bill. I should like to thank the noble Baroness for her exposition of it, but I feel that I ought to tell your Lordships that the Church of England, through its deliberations in the General Synod, has more than once expressed its unease about new arrangements which have been made in connection with British nationality. Almost exactly a year ago a motion was carried in the Synod by 262 votes to nought, with only two abstentions, stating that the Synod, believing that the British Nationality Act 1981 involves the treatment of individuals and families in a manner not in keeping with Christian teaching, requested the Standing Committee of the Synod, in consultation with its Board for Social Responsibility, to make representations to Her Majesty's Government for the reform of the Act and related immigration rules.

I accompanied the Archbishop of Canterbury to the Home Office, where we had a full discussion of these matters with the Home Secretary and the Minister concerned with immigration. Of course, the Hong Kong Bill was not then known to us. We did not know what would happen to the 5½ million people there, 3 million of whom are British dependent territory citizens or, in the customary acronym, BDTCs. Nor did we know what arrangements would be made about the 12,000 Vietnamese refugees in open or closed camps there who are without nationality. As a matter of fact, I do not think they will be worse off than they are now, and we hope that their tragic situation will improve.

We have now been told that BDTCs with the Hong Kong connection will lose that status in 1997 and may join a new class of British citizenship called British National (Overseas). This, we have been told, is in effect similar to British overseas citizenship, and, like that, the new status will carry no right of abode in the United Kingdom and will not be transmissible. It will be available, we are told, to people born before 1st July 1997. Most of the BDTCs are ethnically Chinese, and will therefore be recognised as Chinese nationals. I do not think these should concern us, although there may be some in government service to whom, in his discretion, the Home Secretary will wish to offer British citizenship.

I am concerned rather with that small minority of BDTCs, which has already been mentioned, who are not ethnically Chinese and have no other effective nationality. The largest group is between 5,000 and 6,000 people of Indian descent. After 1997, we are told, they will be British National (Overseas) citizens only. Their children, born after 1997, will be British overseas citizens. I understand that their grandchildren, born after that date, will be stateless. So far as I can see, there is little distinction between the two—the British overseas citizens and the BN(O)s—except that the British Nationals (Overseas) are tied up with having once been BDTCs.

This status of British National (Overseas) citizenship is not really an effective nationality. It carries no right to live anywhere, and, as we have seen, it cannot be transmitted. For the vast majority of the people of Hong Kong this does not matter as they will be able to rely on their status as Chinese nationals. But for the 5,000 or 6,000 ethnic Indian BDTCs it is a matter of great concern. I have already seen the well-argued paper on this subject which the Council of Hong Kong Indian Associations has sent. They do not at present wish to leave Hong Kong, but they have always felt that they belong to the British Empire, not to China, and they therefore feel that they should be offered full British citizenship.

If they are given only British National (Overseas) status it seems to me that, as the noble Lord, Lord Beaumont of Whitley, has just said, their position will be parallel to that of the East African Asians who created such a difficult situation. The Commonwealth Immigrants Act 1968 seems to have been passed somewhat hastily without effective opposition. Here, because of the need for ratification shortly, it seems also to be in the same category. Your Lordships will recall that the East African Asians were left as an abandoned ethnic minority. We hope that that will not again be the case but it could be parallel for the Indian British overseas citizen in Hong Kong.

I understand that the East African Asians will be dependent for a place to live on the goodwill of a country of which they are not nationals and which has no ultimate responsibility for them. The noble Lord, Lord Beaumont of Whitley, seemed to suggest otherwise. I might have this wrong and I hope that the noble Baroness will clear up what will happen to them in the unfortunate situation that they are no longer wanted in Hong Kong. Your Lordships will remember the injustices that the East African Asians suffered. There is a voucher system still in operation, but East African Asians have to wait eight years in the queue for admission to this country.

The right honourable Member for South Down in another place drew a horrifying picture of what might happen if 3 million ethnic Chinese wished to come to this country. I am not suggesting anything of that kind. I am simply talking about a small minority of 6,000 people. Why could they not be permitted to have British citizenship so that they can, if they wish, settle in this country, although most of them at the moment do not wish to do so? One cannot help reflecting that this facility has been given to the Falkland Islanders and to the Gibraltarians, who are white. But this privilege has been denied, except under the inadequate voucher system, to East African Asians who are black and to the ethnic Indian BDTCs settled in Hong Kong, who are also black. It is hard to resist an unwelcome conclusion that the policy of Her Majesty's Government in this respect is racially prejudiced. I hate to say this, but I cannot but note that the privileges given to whites in British dependent territories are denied to blacks.

I hope that the noble Baroness will be able to tell us that this matter will be reconsidered. It is not as though the group of 6,000 ethnic Indian BDTCs in Hong Kong are anxious to come here: they are not, but they need security. They need the kind of citizenship of which I spoke at the beginning when I mentioned St. Paul: a citizenship that is effective. Nor can it really be stated that such numbers would flood the country with immigrants. I think it is not always realised that there is a net migration out of this country, and there has been since 1980. In 1982–83 there was a net outward migration of 21,000 and, according to the projections made by the Central Statistical Office—I do not know whether they are accurate but I have no means of knowing that they are not—the net outward migration will be 34,000 for every year from 1983 to 2001.

Indeed, 5,800 Gibraltarians registered as British citizens in the single year 1983–84: almost as many as the total number of the Indian ethnic minority in Hong Kong. It would therefore be comparatively easy for Her Majesty's Government to show openly that their policy is not racist, to discharge their proper moral obligations to those who have deserved well of us. After all, less than 1 per cent. of the colony is responsible for between 12 to 14 per cent. of its trade.

I therefore hope that proper reconsideration may be given to the status of these ethnic Indian BDTCs settled in Hong Kong, so that they may feel secure in their future and therefore will wish to stay there. However, if they know that their British status is secure, or that they would have a citizenship that guarantees the right to live somewhere, I do not think that they would wish to come to this country.

I raise the matter not because I am intimately conversant with Hong Kong or have resided there like the noble Lord, Lord Beaumont of Whitley. All my visits to the colony have left me amazed at the progress that it makes. I believe that as a churchman I have a duty to draw the attention of your Lordships to minorities who seem to be in danger of being treated less than fairly.

4.6 p.m.

Lord Geddes

My Lords, may I start by personally saying how sorry I am—as I am sure are the rest of your Lordships' House—at the absence, I understand through indisposition, of the noble Lords, Lord Rhodes, Lord Kadoorie and Lord MacLehose. I think our debate is lessened, if I may put it that way, by their absence, and we wish them well.

It will not surprise my noble friend the Minister of State or others of your Lordships that I, too, am homing in on the subject of nationality along very similar lines to the right reverend Prelate the Bishop of Birmingham. I, too, should like to concentrate on the small minorities.

There seem to be four categories of citizenship which will be affected by the Hong Kong Bill. There are two categories of what I describe as ethnic Chinese, most of which either are, or will be, BDTCs. There will be a minority who will not be BDTCs: either way they are ethnic Chinese and, as the noble Lord, Lord Beaumont, and the right reverend Prelate have said, they will obtain Chinese nationality. It is with the rump, if I may call them that, with which we should be concerned. It is the non-ethnic Chinese, be they BDTCs or not, who, and we must welcome this, will become British overseas citizens. To interject, I should like to say what a magnificent title I think that is. It seems to have achieved everything that the Chinese, the Hong Kong people and your Lordships are looking for. It is first-class, and whoever invented it should be congratulated.

As the noble Baroness the Minister of State told us very clearly on 10th December, there is no question of transmissibility of that status. She did not tell us at that stage that it was the BN(O) status, but she said "the new status". The children will be British overseas citizens, as the noble Lord, Lord Beaumont, and the right reverend Prelate have said, but their children, the grandchildren of the BN(O)s, are stateless. Here I would ask, as other noble Lords have asked, whether my noble friend the Minister can give us some assurance on the nationality of what can be described as that third generation. That is a cause of real concern to the United Kingdom Parliament with this legislation going through.

The Government have said, and we all warmly applaud that statement, that they will abide by the United Nations 1961 convention on statelessness. In my ignorance I cannot see how that statement can dovetail in with the potential statelessness of third generation non-ethnic Chinese.

I, too, am particularly conscious of the Indian community. It has been brought to my attention also that the Indian community in Hong Kong has taken counsel's opinion in London as to what might happen. I do not believe that any of us think it will happen—we hope it will not—but if the authorities of the People's Republic went some way to tamper with or alter the rights of abode of the non-ethnic Chinese in the SAR of Hong Kong (and I know that the joint agreement says that they will not) then you will have a situation where persons of no nationality, with no consular protection in the SAR, may then be told that they have no right of abode in the SAR. I think that this is a subject of very real concern and something perhaps for discussion, particularly in your Lordships' House; discussion from which we can stand back and really take a measured view as to what we should do with such persons.

I think it will be superfluous to repeat remarks made by the noble Lords, Lord Cledwyn, Lord Beaumont and the right reverend Prelate. I think that we have all homed in, and my noble friend Lady Vickers will probably also home in, perhaps, on the subject of the Vietnamese refugees. As I said in your Lordships' House on 10th December, it appears from my remarks that I am looking on the negative side. I am not. I think that the agreement that has been made by Her Majesty's Government is a truly magnificent one. I think that tremendous congratulations are due to all those in Government offices, all those civil servants who worked tremendously long hours to achieve an agreement that is, I think, better than most of us anticipated.

I warmly welcome the undertaking by the Government that they will have an annual debate. Like the noble Lord, Lord Cledwyn, I sincerely hope that it is not only that annual debate that will take place in both Houses of Parliament but also the Orders in Council that will come forward for discussion.

My Lords, it is a good agreement for Hong Kong. I think that we are all convinced of that. I think that Hong Kong is convinced of that. The annual debate will allow us to show and to maintain very close concern for the things of Hong Kong. I know that certainly your Lordships' House would like to do so. In conclusion, and in anticipation of tomorrow's Chinese New Year and the coming of the Year of the Ox, I am sure that all your Lordships will join me in saying to Hong Kong, "Kung Hei Fat Choi".

4.12 p.m.

Baroness Vickers

My Lords, I should like to join in this debate, as I did in the previous debate, and I would thank my noble friend the Minister for the very useful information that she has given. I should like to ask about passports. Can she state, for example, what action in that connection might be taken if a Chinese who has lived a long time in this country, then wants to end his life in China or in Hong Kong, in particular? What will happen to his English passport when it is finished in 10 years' time? Can he apply for one of the BN(O) permits in the future?—because otherwise he may also become stateless; and that would be a great pity. I should also like to ask some questions about the new passports. When is the timing of their issue? I think that people are getting rather anxious. What will be the period of their validity? Will it be 10 years, as is the case in this country? What are the rules regarding the registration overseas of BN(O) passport holders, and when are they to start? Finally, what is Her Majesty's Government's position in dealing with BN(O) passport holders who are Chinese nationals? I think that it is important to have a few of these details today, if possible. I would like to know whether there is going to be any chance of their having their nationality passed on, anyhow, to their grandchildren; because by 1997 many of them will have grandchildren. Will they be able to complete this before the hand-over?

There was a very interesting article in the South China Morning Post of Saturday, 26th January last. It was headed: "A Beano for your thoughts". I think the Chinese still have a sense of humour, although that is rather difficult, perhaps, in this matter.

The article stated: What we would like we cannot have and what we want to change we are not to be consulted on. The title is simply the outward and visible sign that Britain is gradually shedding its ties with us, admittedly because it cannot continue its administration of Hong Kong but also because it is unwilling to give us the full benefits of our birthright. There was a time when to be British meant just that. But no longer. Still it is not our intention to bemoan what history has imposed upon us, merely to say our piece on the title Britain has worked out for us, in consultation with Executive Councillors. Firstly, how is the Government going to sound out opinion since it is not willing to reactivate the Assessment Office? I think that that is a rather important point.

In regard to the Indians, while I think that perhaps enough has been said, may I remind my noble friend that the Union Jack was first raised in Hong Kong by 2,700 Indian troops with the British Expeditionary Naval Force and with four Indian merchants. The Indians have a long-standing service in the Civil Service and in the security services. They also founded the Star Ferry Service, the Seamen's Institute and opened the first banks in Hong Kong. The 1984 Memorandum appears to apply only to Chinese compatriots. Can the noble Minister say whether any action can still be taken on their behalf?

There are then, of course, the Eurasians, who have not been mentioned so far. I should like to know whether they would be able to get BN(O) permits. There are a number of refugees and there are a number of small islands around Hong Kong that still belong to the British. Is there any chance of settling some of these people on these islands before we leave? This will give them hope. Otherwise, I cannot see what will happen to them at all. That is a suggestion that might be considered.

Hong Kong is a great place for supporting charities. I should like to know (since I cannot find anything relating to the matter in any of these documents) whether charities are still going to be allowed to be raised and whether they will be allowed to be spent on what the people of China want to spend them on. For example, £12 million worth of Hong Kong dollars were sent to Ethiopia, having been raised by Oxfam in Hong Kong; and the Red Cross raised a 510,000 Hong Kong dollars Families Relief Fund. I hope that this money in future will be quite safe and will be allowed to be exported from Hong Kong to the countries who need it. Many colleges also are supported (and are partly charities) by the people of Hong Kong. Will their accumulated funds be safe? Will they be used for charity on behalf of the Hong Kong colleges concerned?

I turn to the Gurkhas in Hong Kong. What is the future for these people? Will they be employed by the British somewhere else? They have done valiant service in Hong Kong, as many in this Chamber know. I remember Hong Kong in 1946 and I remember the terrible privation and dreadful time they had, suffering, like all the other inhabitants of Hong Kong, during the occupation by the Japanese. They have rebuilt Hong Kong into the thriving place it is today. It is a shipping centre of the world, the twelfth largest shipping centre in the Far East, with a marvellous merchant fleet.

By chance the other night I was looking at television and saw a wonderful documentary "Born to Live". It involved some of the most disabled people I have ever seen in my life. There they were, living with their families, enjoying life. Some of them were really expert actors in this television programme. It went on and I watched it for an hour and a half, which shows how interesting it was. I hope that all the commitments to this kind of work will be able to continue in future. I think it is the most caring film I have ever seen. It was full of optimism, which was a great thing, among these disabled people. I hope that they are happy, that the country will be happy in the future and that it will be a happy place for all the inhabitants when many of the points mentioned today have been settled.

4.20 p.m.

Lord Gridley

My Lords, I have to declare my interest in speaking on the Second Reading of this Bill. I am a former officer of Her Majesty's Overseas Colonial Service with 30 years' experience in that capacity. I am now a pensioner, not of the Hong Kong service, but of the Government of Malaysia. I have to say this. There is considerable interest in Hong Kong among the civilian population as to their future under this Bill, and this also applies to members of the Civil Service in that territory.

It was in these circumstances that on 14th February, as a result of a request from Hong Kong, the BBC in London invited me to answer questions which would be recorded on tape and would be flown out for transmission in that colony; and that has been done. I consider this was a compliment to your Lordships' House; and in all humility I hope I was able to indicate that in all our deliberations in your Lordships' House on the future of Hong Kong when we spoke it was with a paramount desire for the future stability and happiness of all in that territory.

With reference to that, and because of the arrangements initiated in a most commendable way by my right honourable friend the Foreign Secretary in the agreement made with China, from now until 1997, in the years of preparation for the eventual hand-over, if difficulties appear we hope that they can be resolved in that space of time. In that connection we hope that full consideration will obviously be given to the aspirations and fears expressed by people in the Colony.

I was, as a matter of interest, asked to express my opinion on nationality during my visit to the BBC, but at that stage I declined to do so because I felt that was somewhat complicated and also I knew that we would be debating and deliberating on this at the Committee stage of the Bill. However, I should like to say that there is an expression of some concern which has reached me from Hong Kong and which was referred to by the right reverend Prelate the Lord Bishop of Birmingham. It also has been expressed by my noble friend Lord Geddes.

If I may, I would wish now to refer to the debate on the 10th December, when we were considering the future of Hong Kong in your Lordships' House. Anxiety was expressed by the expatriate civil servants in that territory as to the future of their pensions and the opportunity which they had earned and which is contained in their agreements with the Government for transfer and promotion, not spelt out in the Hong Kong agreement, and for which there is no provision in the present Bill.

I asked my noble friend Lady Young for an assurance that Her Majesty's Government would give an undertaking that in the conditions of service, pensions, promotions and so on, the Hong Kong expatriate officer would be treated no less favourably than other officers similarly recruited by Her Majesty's Secretary of State. I asked that a public officer's agreement should apply in all these cases. In reply, my noble friend was good enough to indicate that the Government would take on board the points that I had made. However, she also stated that a public officer's agreement could not apply at this time as Hong Kong would not be independent until 1997.

I must say, with respect to my noble friend the Minister, that that beggars the point I was making at that particular time when talking about the agreement. I desired a public officer's agreement, or something equally binding, for the members of the Overseas Service of Her Majesty's Government to be made known to them and to the expatriate officers in Hong Kong at a very early stage. It would be useless to the people of Hong Kong, including His Excellency the Governor, if in the interval from now until 1997 His Excellency and the people of Hong Kong were to lose experienced staff in that territory because some might go, not because of any particular desire to do so but because of a lack of assurance regarding their future, and so therefore they might decide to cut their losses and leave Hong Kong before it was too late and they were too old to secure a career somewhere else or in another service. If such a situation were to arise, it would not be in the interests of anybody, least of all to the people of the Colony.

Finally, in order to emphasise the force with which I am asking for this matter to be looked at, I have with me a number of papers which set out in some detail the special obligations which Her Majesty's Government consider they have towards officers recruited by Her Majesty's Secretary of State for Service Overseas and which must in every way apply to the expatriate officer in Hong Kong, so far as I can see. By that I am referring to a guarantee in terms of their service—that is to say, pensions, opportunities for promotion and transfer—which I am asking Her Majesty's Government to make clear now as an assurance to the expatriate officers in Hong Kong. Doubtless my noble friend the Minister may know of these documents, but I make reference to them at this stage.

They are as follows. There is the document, Miscellaneous No. 520, printed for the Colonial Office, Her Majesty's Overseas Civil Service, Special Regulations by the Secretary of State for the Colonies. That was printed for the Colonial Office in July 1954. There is secondly Command. 1193, Service with Overseas Governments, presented to Parliament by the Secretary of State for the Colonies by Command of Her Majesty, October 1960; and, finally, from the Colonial Office, Colonial No. 306, dated July 1954, entitled Reorganisation of the Colonial Service. I should like to quote a short passage from that. It says this about the reorganisation of the Colonial Service—(and I now quote from part of paragraph 3): They are servants of the Crown, and the conditions of their employment are embodied in the Colonial Regulations. These Regulations constitute the Secretary of State as the ultimate authority for appointments, discipline, promotions and general conditions of employment. The members of the Service—and more especially those who have been recruited for the unified branches by successive Secretaries of State—are now asking, and are entitled to ask, what will be their position if and when as a result of constitutional changes, Her Majesty's Government in the United Kingdom are no longer able to exercise effective control over their tenure and conditions of employment as hitherto. Paragraph 4 says this—it is a statement by Her Majesty's Government of the day: The debt which the overseas territories owe to the loyal, devoted and efficient work of the men and women in the Colonial Service is inestimable. Their work is far from over. The task of building up fully equipped local public services is progressing fast; it is an evolutionary process which will be completed at different times in different places. But side by side there is going on the evolution of the Colonies and other territories themselves, and while their economies and activities continue to expand a wide field of opportunity and need for the skilled assistance of British staff remains. This fact is fully recognised by responsible leaders in the territories. The last paragraph reads: It is then of the first importance to these countries, and not least to those where a new burden of responsibility is being undertaken by their own governments, that their progress should not be set back by the premature loss of experienced staff or by failure to attract new staff which they may require. There is a problem here which cannot be solved by the territorial governments alone or by Her Majesty's Government in the United Kingdom alone. Both sides must act in partnership. Finally, it is my hope that there will be constitutional progress in Hong Kong, that the people will enjoy a form of stability and happiness and that Britain will play a great part in the evolution of this territory. It is very important at the present time that Her Majesty's Government should give an assurance that, when they divest themselves of responsibility for that colony, the terms of service of the overseas expatriate officers will be guarded and guaranteed, that they will enjoy what they are entitled to enjoy in the circumstances which I have explained to your Lordships and that we shall get the happiness and prosperity in that country which everybody deserves.

4.32 p.m.

The Earl of Selkirk

My Lords, if I may say a short word, I believe that this agreement may well come to be regarded as one of the greatest acts of statesmanship, possibly even in this century. It is almost unbelievable that the Chinese were prepared to sign a treaty with anyone. Their immense sense of racial pride in which they are fully justified, with a continuous history going back some 4,000 years or more and their regard—or, shall I say, a certain contempt—for the rest of the world, in which they are also fully justified, makes it difficult to understand that they have come to this arrangement. We certainly could not have done it 10 or 20 years ago and I believe that the Government deserve every possible congratulation on seizing a unique moment.

Our problem is to make it a success. The treaty is there, and I believe it is a sound treaty, but success will depend on many factors. The noble Lord, Lord Cledwyn, discussed passports and the right reverend Prelate has mentioned refugees. Refugees will be a very difficult problem, because neither the Chinese nor the people of Hong Kong very much like the Vietnamese, so distributing them about will be a problem. I think that this was inevitable, both for race reasons and for the economic success of Hong Kong. Of course, with its great success, if for no other reason, the Chinese want to take over Hong Kong.

I happened to be present a couple of years ago when the local elections were taking place and they were extremely interesting. As a pure lesson in democracy, they were greatly superior to the elections in this country. They were only for local government. There were no parties. The three candidates were all friends. I did not talk much to them, because they spoke only Chinese. Curiously enough, one of the families had been in the neighbourhood of Hong Kong since the time of Sung and had presumably been driven there by Genghis Khan, when he took over and built Peking.

There is one question which I should like to ask my noble friend to examine. I wonder whether we should recognise that the success of this treaty will depend on our relations with Peking. If we have bad relations with Peking, they will almost certainly take it out on Hong Kong. I wonder therefore whether the Foreign Office should consider training a body of diplomats who are well accustomed to Chinese ways, speaking their language with perfect competence and knowing and understanding their pride in history, so that they are attuned and acceptable to that community. If we have bad relations with Peking, it will certainly react on Hong Kong. This is difficult, because the Chinese are a separate race and to send people there who do not understand their pride of race, their sense of realism and their attitude might be a grave mistake. I do not know how many people in the Foreign Office speak Chinese. I have asked that question before and been told that it is not a very big number. I therefore suggest that this aspect should be very carefully considered.

4.36 p.m.

Baroness Young

My Lords, we have had an excellent debate on Hong Kong today—a debate which I believe illustrates the commitment of this House to that territory and to its people. I should like to join my noble friend Lord Geddes in saying how much we all miss the noble Lords, Lord MacLehose, Lord Rhodes and Lord Kadoorie, from this debate today. I am glad that there has been a large measure of support for this Bill from all sides of the House and I particularly welcomed what was said by the noble Lords, Lord Cledwyn and Lord Beaumont. It is particularly important to maintain all-party support in this House for the agreement on Hong Kong. There are 12½ years between now and 1997. There are bound to be some difficulties in those years, and we must do all we can to avoid unnecessary divisions and to promote a sense of stability and confidence in Hong Kong. I was therefore glad of the support from both the noble Lord, Lord Cledwyn, and the noble Lord, Lord Beaumont, in particular, for the fact that the Government have moved to meet the strong desire on all sides of the House for an annual report on Hong Kong. No doubt, if the House wishes to debate the annual report, this can be discussed through the usual channels.

A great deal of the debate this afternoon centred on the question of nationality and I shall return later to deal with some of the detailed points that have been raised. But I should like, following the point raised right at the beginning by the noble Lord, Lord Cledwyn, to confirm to him that the Government are prepared to give this House an opportunity, if it wishes, to debate the draft order on nationality in a preliminary way before the House is asked to give its final approval. That is a scheme which I think has been described as debating a draft order with green edges. If necessary, the Government would then withdraw the order and revise it to take account of views expressed by noble Lords and in Hong Kong, before resubmitting it to be dealt with in the normal way under the affirmative resolution procedure. I believe that this will meet the concern which has been expressed.

I must emphasise, however, that while the United Kingdom memorandum is formally distinguishable from the Joint Declaration, the Government would be bound to oppose any attempt to introduce into the order any provisions that were contrary to the memorandum. The fact of the matter is that the memorandum forms an integral part of the whole package which was negotiated with the Chinese Government and was subsequently found acceptable by the people of Hong Kong. We should be obliged to resist strongly any amendments to the draft order which would jeopardise the overall package.

The noble Lord, Lord Cledwyn, also asked me about the Basic Law. This is clearly a matter for the Chinese Government, but they have made it clear that the views of the people of Hong Kong will be solicited on a wide basis and that the Basic Law will be promulgated no later than 1990. The mechanics of this consultation are not yet clear, but we welcome the fact that the Chinese Government have expressed the intention to consult Hong Kong opinion.

I was also asked about the Joint Liaison Group which will be established on the entering into force of the agreement. We are still working on the arrangements for this. Its establishment is still some months off and work remains to be done. The Government will announce the membership of the group and other details in due course. I should like to assure the noble Lord, Lord Cledwyn, that the Government will approach the Joint Liaison Group in a positive spirit. Co-operation with the Chinese Government will be of the utmost importance in the coming years to ensure a smooth transition.

Lord Cledwyn of Penrhos

My Lords, if the noble Baroness would be so kind, I wonder whether she can say more about consultation on the Basic Law, or have the Government not yet taken any steps to consult the Chinese authorities about the nature of that consultation? What is the position?

Baroness Young

At this stage, my Lords, I cannot say anything more. This matter is one to which we can return at a later stage in the progress of this Bill. If I can give the noble Lord any further information, I shall of course do so.

The noble Lord asked me also about the GATT and the multi-fibre agreement. He stressed the importance of ensuring that Hong Kong will continue to participate in the GATT and other arrangements and agreements. I can confirm that the agreement allows for Hong Kong's continued participation in the GATT and any successor to the multi-fibre agreement. It provides also that the Hong Kong SAR will have the status of a separate customs territory. A priority task of the Joint Liaison Group will be to consider action to be taken by the British and Chinese Governments to enable the SAR to function as a separate customs territory and to ensure the maintenance of its participation in the GATT and similar arrangements. Given the widespread international welcome for the agreement, I have no doubt that our partners will show sympathy and support towards Hong Kong. While we have of course taken pains to explain the agreement to other friendly governments, formal action on the Hong Kong position in the GATT still lies ahead.

I now turn to the questions raised about nationality. I shall of course carefully read what has been said in today's debate. If among the very specific questions there are one or two that I do not answer today, either we can return to them at a later stage, or I shall write to the noble Lord concerned.

I should like to confirm what the noble Lord, Lord Geddes, said concerning the new title on nationality. I am glad to have his agreement that we have chosen well. As I indicated in my opening remarks, careful consideration has been given to this title and the Government believe that it meets the needs of all the parties concerned.

A great many of your Lordships referred to the problems of statelessness. As I made clear at the beginning of this debate, the Government have made clear their intention—that no former Hong Kong BDTC, nor any child born on or after 1st July 1997 to such a person, shall be made stateless as a result of the arrangements envisaged in the Bill. I made it clear that the proposal was that children born after 30th June 1997 to non-Chinese former BDTCs should acquire BOC status automatically at birth if they would otherwise be stateless. This is intended to apply only to the first post-1997 generation.

I appreciate that there may be—and concern has been expressed about this—potential statelessness among subsequent generations. I must repeat that, in the Government's view, it would not be appropriate as a general principle to grant British nationality indefinitely and without restrictions to the descendants of British nationals. But we are, as a matter of urgency, looking at the question of potential statelessness among further generations. I do not believe that we can solve these problems at once, and I suspect that further discussions with the Chinese Government will be necessary.

I listened with great care to what was said by the right reverend Prelate the Bishop of Birmingham. I must say to him that I resent the suggestion that the Government's immigration policy is racialist. I ask him to consider the implications of granting the right of abode to one section of the BDTC community in Hong Kong, apparently on racial criteria.

I now turn to the question of Indians, which was originally raised by the noble Lord, Lord Davies of Leek, and then by the noble Lords, Lord Cledwyn and Lord Beaumont, and by my noble friend Lady Vickers. There are some 6,000 ethnic Indians in Hong Kong. My right honourable friend the Minister of State for Foreign and Commonwealth Affairs, Mr. Richard Luce, has had an opportunity to discuss the concerns of this group with Mr. Harilela, president of the Council of Hong Kong Indian Associations, and has fully explained to him the Government's position.

The majority of Indians in Hong Kong are BDTCs. As such, they will be eligible to acquire BN(O) status. Those who have made their home in Hong Kong will be able to enjoy right of abode in the Hong Kong Special Administrative Region under the provisions of Section 14 to Annex 1 of the Joint Declaration. In negotiating that agreement, we have done our utmost to make sure that Hong Kong will continue to be a satisfactory place for all its present inhabitants to continue to live in after 1997. I believe that we have succeeded in that. The right reverend Prelate the Bishop of Birmingham expressed his concern on this point.

Therefore, I do not consider that there are grounds for granting right of abode in the United Kingdom to this group. But I can confirm that, so far as our international obligations are concerned, Her Majesty's Government will fully comply with the United Kingdom's obligations under the 1961 convention on the reduction of statelessness.

I was asked also about the position of Eurasians. Their position will depend on whether or not individuals are Chinese citizens under Chinese nationality law. If they are, they will be as other Chinese. If they are not, then the kind of problems which noble Lords have identified over potential statelessness could apply to them. But as I have just indicated, we have done our utmost to make Hong Kong a satisfactory place in which its present inhabitants may continue to live after 1997.

The noble Lord, Lord Cledwyn, asked two further questions concerning the recognition of passports. I assure him that the Government will do all they can to ensure the same access to other countries for holders of BN(O) passports as that enjoyed at present by BDTC passport holders. The Government will make every effort to explain the new arrangements to third countries between the enactment of the Order in Council and the issue of the BN(O) passports. The noble Lord asked whether passports will state a right of abode in Hong Kong. The answer is that they will. A statement to this effect will be entered by Her Majesty's Government with respect to the period before 1997. As laid down in Section 14 to Annex 1 of the declaration, we shall after 1997 be able to state that the holder of the passport holds a permanent SAR identity card which is evidence of his right of abode in the SAR.

The noble Lord, Lord Cledwyn, asked additionally about the need to carry an identity card. The Government will be discussing with the Chinese authorities the wording of a statement to be included in BN(O) passports. The aim will be to ensure that an individual need make use of his passport only, without also having to provide his identity card to satisfy immigration officers of third countries that he has the right of abode in Hong Kong.

My noble friend Lord Gridley raised a very important point—as I expected him to do—about those currently employed in Hong Kong and their future pensions. He spoke about this aspect at some length when we debated this matter in early December, and I acknowledge the sincerity with which he makes his point and the knowledge that he has of the circumstances which could surround this particular group of people. I am afraid, however, that there is little I can add to what I said in the last debate regarding the position of officers in Her Majesty's Overseas Civil Service in Hong Kong. The agreement provides satisfactorily for the continuity of service by serving officers in the public service in Hong Kong on terms and conditions, including pay and pensions, no less favourable than on 30th June, 1997. These provisions apply to members of the overseas Civil Service serving in Hong Kong, as well as to other civil servants.

The resumption of sovereignty over Hong Kong by the People's Republic of China raises similar issues in respect of HMOCS as independence has in other dependent territories. Public officers' agreements have generally been negotiated at the last moment before independence and signed after independence. Consitutional change is still 12 years ahead in Hong Kong. I absolutely agree on the need to maintain the morale of HMOCS officers in Hong Kong, and I can assure your Lordships that the Government will continue to keep their interests closely in mind.

Finally, my noble friend Lord Selkirk intervened to make a very important point. It is something which the Government certainly appreciate and we have every reason to think that our relations with the Chinese Government will be good. Both we and the Chinese Government are satisfied with the agreement that has been reached. I shall also take note of my noble friend's point about making sure that enough members of the diplomatic service are able to speak Chinese. From my own personal experience in the Foreign Office, I have been impressed by the number of Chinese speakers I have met. Only since I have been at the Foreign Office have I ever attended a lunch of both Chinese and a number of members of the Foreign Office to find that I was the only person at the table who did not speak Chinese. Nevertheless, I take the point and I am sure that it is well taken by the professional service.

As I said, we have had a very good debate. It is fair to conclude from it that, just as the agreement was acceptable to the House, so the Bill which will enable the Government to ratify the agreement is broadly acceptable to the House. There is no disagreement that we should provide for the termination of sovereignty and jurisdiction over Hong Kong on 1st July, 1997. There is no disagreement about the need to legislate on nationality, the adaptation of law and to provide diplomatic privileges and immunities to the Chinese members of the Joint Liaison Group. I recognise that there are questions on the exact mechanisms we should use to meet these ends, but I hope I have explained satisfactorily why the Government have adopted the approach they have in this Bill. I hope that the House will now give the Bill a Second Reading.

Lord Davies of Leek

My Lords, before the noble Baroness sits down, in thanking the noble Baroness for her comprehensive answer and anent that point, would she not consider offering to junior members of the diplomatic service an extra advantage by giving them grants in order to learn Chinese during their period of office? Some kind of grant could be given as an encouragement to members of the Civil Service to learn Chinese.

Baroness Young

My Lords, I certainly note the point made by the noble Lord. I think I am right in saying that the Foreign Office has very good arrangements for enabling serving officers to learn Chinese. As a country we should be very proud of the numbers who are able to speak Chinese fluently.

Lord Beaumont of Whitley

My Lords, before the noble Baroness sits down for a second time, she having made a point about the Eurasians and the Chinese nationality laws, may I ask her whether there is a satisfactory digest of the relevant part of the Chinese nationality laws? If so, could we possibly be furnished with one and possibly have a copy put into the Library, too?

Baroness Young

My Lords, without notice I cannot say whether or not there is a particular document that would answer the question put by the noble Lord, Lord Beaumont. I recognise that the whole question of nationality is a complex matter. I shall make available notes on clauses before the Committee stage and they may help the noble Lord on some of these detailed matters. If there is other information which is generally available I shall certainly let him have it but, without notice, I cannot say that such information is available.

On Question, Bill read a second time, and committed to a Committee of the Whole House.