Lords Sitting of 15 December 1992

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.

Trade Deficit
Lord Peyton of Yeovil Lord Peyton of Yeovil asked Her Majesty's Government:
Whether they will review the Answer given to Viscount Caldecote on 18th November concerning the prospective trade deficit in 1993 (Official Report, col. 613.) and whether they have any proposals for the reduction of the deficit.
The Parliamentary Under-Secretary of State, Department of Trade and Industry (Baroness Denton of Wakefield): My Lords, the prospective trade deficit forecast for 1993 remains at £19.5 billion. The Government are committed to a sound macroeconomic policy which provides sustainable, non-inflationary growth. It means ensuring open competition in our domestic markets and in international markets, through a conclusion to the GATT round, reducing the burden of government through the deregulation initiative and low taxes in order to ensure that enterprise is not stifled.
Lord Peyton of Yeovil: My Lords, does my noble friend realise that her reply will be welcome for its contrast with the earlier reply which seemed to be almost incredibly detached from such an important matter? Does she realise that it will be even more welcome if it heralds a departure from the wooden and neutral attitudes which have characterised the Government's approach to industry and its problems for too many years?
Baroness Denton of Wakefield: My Lords, I must point out to my noble friend that my noble friend Lord Henley was asked about figures and replied about figures. I am delighted to confirm to my noble friend Lord Peyton that, as my right honourable friend the President of the Board of Trade said, he will intervene on behalf of industry but not in industry.
Lord Brougham and Vaux: My Lords, what is the car industry doing as regards our balance of payments?
Baroness Denton of Wakefield: My Lords, I am delighted to tell my noble friend that the automotive industry is one of our leading success stories. Exports of cars in September were at their highest level since records began and in 1994 we should see a surplus in that area.
Lord Stoddart of Swindon: My Lords, is the noble Baroness not aware that the figure of £19.5 billion is enormous? Will she say how it is to be financed? Does she not agree that we can reduce that enormous deficit
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only by promoting our manufacturing industry as it has never been promoted before because that is the key to our economy, to success, and to prosperity?
Baroness Denton of Wakefield: My Lords, it gives me enormous pleasure to agree with the noble Lord, Lord Stoddart.
Noble Lords: Hear, hear!
Baroness Denton of Wakefield: We shall indeed promote the international competitiveness of our manufacturing industry which will mean that our products are also attractive to the purchaser in the home country. We shall tackle the problem from both ends. We shall be able to finance that deficit.
Lord Richard: My Lords, is the Minister aware that the prophecy of a £19.5 billion deficit for next year is a cause for shame rather than for triumph? Does she not agree that the reduction in Britain's manufacturing base and the consequent shortage of UK manufactured goods mean that any economic recovery in the near future will increase rather than diminish the trade deficit? Finally, since the Treasury's forecast for the balance of payments deficit for the whole of this year was £6.5 billion whereas the actual deficit for the first nine months was £8.8 billion, what faith can we have in her figures?
Baroness Denton of Wakefield: My Lords, I should draw to the attention of the noble Lord, Lord Richard, that my noble friend changed the wording of the Question so that we are looking forward at what can be done. The success of manufacturing industry and productivity in the UK compared with the record of our European partners means that those figures can be achieved.
Lord Harmar-Nicholls: My Lords, is my noble friend aware that the success of industry depends on industry itself? It has to make itself competitive and, in price terms, capable of producing the quality and the right price. Does my noble friend agree that the only point at which the Government come into it is to make certain that they give full and proper attention to a correct settlement of the GATT negotiations instead of being too preoccupied with what might develop in Europe?
Baroness Denton of Wakefield: My Lords, I thank my noble friend. I believe that it is the Government's role to create a climate in which industry can carry out growth. We have got interest rates down by eight points; we have inflation under control; and we have also fought hard and retained the European fighter project.
Lord Benson: My Lords, does the noble Baroness agree that the sensible course would be to publish a White Paper defining the Government's strategy for industrial production? That would answer questions for Parliament and the public. The penetrating questions that have been asked could be dealt with efficiently in that way.
Baroness Denton of Wakefield: My Lords, I recognise the anxiety of the noble Lord, Lord Benson.

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I shall certainly convey his remarks to my right honourable friend. We believe that our industrial strategy is defined. If communication of the message is less than good, we shall look at areas for improving it. Perhaps I may take the opportunity of saying that on an earlier occasion the noble Lord said that the DTI should act as a football manager. I assure him that we aim to win the world cup.
Lord John-Mackie: My Lords, does the noble Baroness realise that there is a £3,000 million deficit in our temperate food balance with abroad and that we are taking out 2 million acres of arable land at the same time? Does that sound like sense?
Baroness Denton of Wakefield: My Lords, I am sure that if the noble Lord were to ask that question of my noble friend at the Ministry of Agriculture he would get a very good answer.
Lord Mackay of Ardbrecknish: My Lords, does my noble friend agree that our success in modern industry is very pleasing indeed set against the problems that we undoubtedly have with the left-overs of the Victorian age? In particular, does she realise how successful the UK pharmaceutical industry has been? Is she aware that some of the world leaders in that industry are based in the UK and that it is an area in which we have a very considerable balance of payments surplus?
Baroness Denton of Wakefield: My Lords, I thank my noble friend for drawing attention to the changes that have taken place in British industry. Not only do we have a successful story in the pharmaceutical industry, but we also have a substantial net export of TV sets. The records and tapes industry should be congratulated. It moved from a £139 million deficit in 1989 to a surplus of £42 million in 1991. There are industries which are doing very well.
Lord Jay: My Lords, does the Minister agree that one way not to reduce the deficit is to destroy the British coal industry?
Baroness Denton of Wakefield: My Lords, one way not to help British industry would be not to have a competitive energy policy.
Lord Peyton of Yeovil: My Lords, will my noble friend bear in mind the suggestion of the noble Lord, Lord Benson, for a White Paper? Will she also have in mind the real need for unity in this country? There is nothing disreputable in seeking unity. For too long we have been divided on problems which threaten the existence of all.
Baroness Denton of Wakefield: My Lords, I believe that noble Lords have heard me say in the past that one of the great benefits of inward investment has been to prove the skills of the British workforce. We recognise those and that there is a need for communication with unions. It gives me great pleasure to say that my right honourable friend the President of the Board of Trade recently met with Mr. Scargill.

Bosnian Refugees: Educational Courses
2.47 p.m.
Lord Merlyn-Rees Lord Merlyn-Rees asked Her Majesty's Government:
How universities have responded to the need to make student places available to Bosnian refugees, and what is the position as regards fees.
Viscount Astor: My Lords, about 60 universities in the United Kingdom have indicated their willingness to help students displaced by the war in former Yugoslavia by providing places on courses and waiving tuition fees. The institutions individually have the discretion to determine fee levels for their courses; this extends to abating or waiving fees in the light of individual circumstances.
Lord Merlyn-Rees: My Lords, what an excellent answer to a first Question! I could ask for nothing better. All I hope is that the department will co-ordinate the scheme. I am glad to hear what has been said about fees because that is a difficult factor. I thank the noble Viscount very much for the Answer. I look forward to seeing the results in the terms ahead.
Lord McIntosh of Haringey: My Lords, if the Minister is so satisfied with my noble friend's remarks, perhaps I may extend it a little wider. Is it not the case that Clause 6 of the Asylum Bill now before another place provides that, if a student studying here is an applicant for asylum but fails to achieve it, he or she may be sent back immediately without finishing the university or college course? Does the Minister feel that that is in accord with the helpful Answer that he gave to my noble friend earlier?
Viscount Astor: My Lords, asylum seekers have their applications screened. They are issued with an acknowledgment letter which allows them to apply for social security and housing benefit. They are assessed for benefit according to criteria which take into account individual circumstances. After six months those who have applied for asylum may seek leave to vary their leave to remain to allow them to seek employment. That is normally granted. It is the Government's policy that people will not be returned to an active war zone.

VAT: Transitional Arrangements
2.49 p.m.
Lord Mottistone Lord Mottistone asked Her Majesty's Government:
When they expect that orders will be laid implementing the transitional arrangements for the collection of VAT after 1st January 1993; and whether all aspects of the new system will come into force at the same time.
The Minister of State, Department of Transport (The Earl of Caithness): My Lords, the majority of the orders implementing the transitional arrangements for the collection of VAT from 1st January 1993 were laid on Monday 14th December. Six orders which are subject to affirmative resolution are to be laid this

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Thursday. Two further orders which are necessary as a result of a directive agreed at ECOFIN yesterday will also be laid on Thursday. It is therefore intended that all aspects of the new system will come into force on 1st January 1993.
Lord Mottistone: My Lords, does my noble friend agree that that is very late in the day? It is extremely difficult for people to comply with what I believe is a complicated new system—even more complicated than its predecessor. Will he also confirm that the only document giving evidence that the transaction has taken place is that which will be carried by the lorry driver? Is he happy that lorry drivers will be encouraged to return these documents quickly?
May we also be assured that, where a purchaser in one country from a supplier in a second country requires delivery to a third country, there will not be double taxation? Finally, can my noble friend assure me that simplification of rules for triangular transactions will be included in the documents which he said were being laid before Parliament at the moment?
The Earl of Caithness: My Lords, I lost count of the number of questions my noble friend asked, but I will answer the first two. Yes, the orders are late in the day. The reason is that the base directive was only agreed in December 1991. We had to have primary legislation—that was the Finance (No. 2) Act, all 70 pages of it, as your Lordships will remember. We then drafted the secondary legislation, exposed it for consultation, made the amendments and have now laid it before Parliament. Yes, my Lords, I agree with my noble friend, it is complicated.
Lord Howie of Troon: My Lords, is the Minister aware of the anxieties which have been expressed by the Periodical Publishers Association on the imposition of VAT on subscriptions to British magazines sold in other EC countries? Will the Government consider exempting items sent through the post and weighing less than five kilograms, including magazines? That would be in order to reduce the bureaucratic burdens on the magazine publishing industry. I believe that that is the case in Germany.
The Earl of Caithness: My Lords, the noble Lord has asked me quite a difficult question, I have about 1½ inches of paper on it. Perhaps I may write to him with a specific answer.
Lord Howie of Troon: My Lords, with the full 1½ inches!
Lord Boyd-Carpenter: My Lords, will my noble friend explain how orders requiring an affirmative resolution laid on Thursday can possibly come into effect before 1st January?
The Earl of Caithness: My Lords, the orders are deliberately designed to give the maximum time for debate in Parliament. That is why they were laid on Thursday rather than earlier. If we had laid them earlier, there would have been less time for debate. They will apply from 1st January, although we shall not have a chance to debate them until next year.
Lord Stoddart of Swindon: My Lords, are these transitional arrangements likely to impose additional costs on industry and commerce? If so, can the noble Earl give an estimate of those additional costs?
The Earl of Caithness: Yes, my Lords, there will he some additional costs. At the moment, under what is known as the temporary provisions, someone has, for example, been able to buy a yacht, motor car or plane in this country, take it to another EC country and avoid paying VAT on it. From 1st January, VAT will be payable, but I cannot give the noble Lord an estimate of the costs.
Lord Cockfield: My Lords, does my noble friend agree that the directives adopted yesterday to modify the transitional system simplify it? Is that not a matter for congratulations rather than criticism?
The Earl of Caithness: My Lords, I am grateful to my noble friend for those comments. He knows the dossier, or dossiers, better than anyone else in your Lordships' House having been the originator of them, although we have ended up with a slightly different system. He is absolutely right to say that a simplification directive was agreed which will be to the benefit of all traders.
Lord Bruce of Donington: My Lords, the noble Earl will be aware that for the next six months after 1st January we shall be without reliable statistics concerning our imports and exports from the remaining countries of the EC, due to the new regulations. Will he confirm that the arrangements for the satisfactory collection of interim trade statistics for the remainder of the EC, in so far as these can be reliably ascertained, are now in place?
The Earl of Caithness: My Lords, the noble Lord raises an important point. Now that there will be an abolition of frontier controls on 1st January, the point which he raised is one of the difficulties resulting from that abolition. Perhaps I may assure the noble Lord that every effort is being made to obtain the best statistics available.
Lord Richard: My Lords, does the Minister recognise that there is a problem? From 1st January companies will have to operate a new system with which they are basically still unfamiliar. Does he also agree that Her Majesty's Customs and Excise are not perhaps noted for their flexibility when it comes to the collection and coding of VAT? Can he assure the House and the companies which will have to operate the system that Customs officers will be understanding of genuine lapses by companies in the early days of implementing these new and complex charges?
The Earl of Caithness: My Lords, it will not only apply to this country; all member states will be in the same difficulty with the new directives coming into force on 1st January. What I can say to the noble Lord the Leader of the Opposition is that the Customs and Excise have gone to immense trouble to keep in touch with traders by holding seminars, printing leaflets and sending out newsletters. They are setting up a special office in Dover to try to help in the first three months.
Viscount Caldecote: My Lords, will my noble friend ensure that in the present difficult circumstances the problems of small companies are taken fully into account in the arrangements for collecting VAT?
The Earl of Caithness: My Lords, I am sure that the Customs are aware of the problems of small businesses, but I shall certainly draw this matter to their attention.
Lord Mottistone: My Lords, will my noble friend give consideration to writing to me with the answers to the questions I asked him? I quite understand that he found them too difficult to answer off the cuff, but it would be helpful if he would write to me. Many people are worried about the points that I raised.
The Earl of Caithness: My Lords, the questions were not too difficult to answer off the cuff; they were too numerous to answer off the cuff. But of course I shall write to my noble friend.

Royal Ordnance: Orders
2.56 p.m.
Lord Dean of Beswick: My Lords, in the absence of my noble friend Lord Howell and with his permission, I beg leave to ask the Question standing in his name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what proposals they have for further orders for the Royal Ordnance after March 1993.
The Parliamentary Under-Secretary of State, Ministry of Defence (Viscount Cranborne): My Lords, the Ministry of Defence is reviewing its procurement strategy for ammunition following the expiry of the Explosives and Propellants and Related End Products agreement in March 1993. So far as possible, open competition will be used to ensure value for money and Royal Ordnance will be invited to bid for new orders. There can be no repeat of the EPREP arrangements.
We are looking at the possibility of longer term contracts of up to five years for some key items. This will give security of supply for the armed forces as well as providing industry with a better basis for forward planning and investment.
Lord Dean of Beswick: My Lords, I am grateful to the Minister for that detailed Answer. However, he must be aware that there have already been substantial redundancies in factories followed by more commercial awareness of living in the real world and not having guarantees. Along with increased performance, there is also in the pipeline, I understand, the development of new projects. Given time, those projects could be world-beaters in a commercial sense. Many people involved in them need to be encouraged that there will not be further redundancies and that the workforce will be kept intact. Is the Minister aware that if there are massive further redundancies, we shall literally go out of business on the international scene which, I am sure, is the last thing that the Government or anyone else want?
Viscount Cranborne: My Lords, I am grateful to the noble Lord for raising this Question. I wish to point out that the Ministry of Defence has a clear obligation to the taxpayer to make sure that it obtains maximum value for money in the procurement of ammunition, as with the procurement of everything else.
As a result of the new arrangements over the past five years, the price of heavy ammunition has decreased by about 50 per cent. and of small arms by 25 to 30 per cent. The redundancies are a matter for the parent company of Royal Ordnance, although, as I said in my earlier reply, we are aware that there are certain central matters which are of importance to procurement and which will themselves guarantee employment.
Lord Ironside: My Lords, is my noble friend aware that Royal Ordnance has this week in the MoD contracts bulletin been invited to tender for a large quantity of 5.56 millimetre blank cartridges? Those are rifle cartridges. Can he say why three other foreign firms have been invited to tender for the same product? How can he ensure fair competition here and the avoidance of any risk of dumping taking place?
Viscount Cranborne: My Lords, my noble friend will be well aware from his own experience that we are committed to what I am told is called a "level playing field" in this respect. In fact, the IEPG, the Independent European Programme Group, the last meeting of which I attended in Bonn last week, is committed to an agreement in this area. We are not yet satisfied that our European and NATO partners are operating as satisfactorily as they might, and we are committed to trying to improve their performance.
Lord Monkswell: My Lords, are the Government aware of the deficiencies of the infantry small arms system known as the SA80? What plans does the Ministry of Defence have for commissioning a replacement? What assurances can the Government give that such a replacement will be manufactured in the United Kingdom?
Viscount Cranborne: My Lords, I suspect that this matter is slightly outside the scope of the Question. If, however, your Lordships will allow me to do so, I should like to take advantage of the noble Lord's intervention to assure him that, in spite of initial difficulties with the procurement of the SA80, I know from personal experience that all ranks, from the Chief of the Defence Staff down to the lowliest private, are now happy with the SA80—with its accuracy, its revised design and the quality of its assembly.
Lord Williams of Elvel: My Lords, will the noble Viscount bear in mind that this is a serious situation for the Royal Ordnance factories and that, when the agreement runs out at the end of March 1993, there are liable to be up to 7,000 redundancies? That will put us out of business in terms of the provision of ammunition for the armed forces. Are the Government really satisfied that they can rely on foreign sources selling us ammunition, as the noble Viscount implied, possibly at marginal cost—not

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at full cost and not on a level playing field? Are the Government really satisfied that that is in the interests of the defence of the United Kingdom?
Viscount Cranborne: My Lords, I must advise the noble Lord, Lord Williams, that, as he rightly observed during the course of my perhaps over-lengthy initial Answer, we have been careful to look at the possibility of longer-term contracts for up to five years covering some absolutely key items for the same reason that he gave. Meanwhile, as he is well aware, there is a massive over-supply of various kinds of ammunition in certain areas which it is convenient for us to consider in terms of value for money. I sincerely hope that the Royal Ordnance factories will be able to compete, particularly as a result of the improvements in their management during the past few years.
Lord Mayhew: My Lords, the noble Viscount referred to the SA80. Has it been issued to our forces in Bosnia and, if so, are they satisfied with it?
Viscount Cranborne: My Lords, the noble Lord, Lord Mayhew, knows as well as I do that the SA80 is now the standard infantry weapon and, as such, has been issued to the Cheshire Regiment. As far as I am aware, that regiment is as satisfied as anyone else with the performance of the SA80 as now issued rather than as originally issued.
Lord Marlesford: My Lords, does my noble friend agree that with the growing world disorder there are, unhappily, likely to be an increasing number of occasions when the United Nations will seek well-trained and well-equipped forces to undertake peace-making or peace-enforcing roles throughout the world? Will the Government ensure that Britain's forces, which are so well suited to this task, are properly equipped and maintained? That, of course, has considerable implications for the British armaments industry in general and for the Royal Ordnance factories in particular?
Viscount Cranborne: My Lords, I am most grateful to my noble friend for his remarks. I hope that he will accept—and not only from me —that our troops in Bosnia are doing a remarkably professional job, as I was told at a reception last night for the defence correspondents, a number of whom had visited them. They were unanimous in saying that never before—even by the high standards of British forces—had they seen such a professional job being done. And they are, after all, supposed to be dispassionate observers. Equally, I can advise my noble friend that we have been extremely careful to ensure that, in view of the extreme conditions under which they are operating there, our troops have the best possible equipment, notably cold weather equipment. We have taken considerable care to ensure that they are properly equipped in that respect.
Lord Mackie of Benshie: My Lords, is the Minister able to assure us that in asking for competitive tenders the Ministry of Defence has protected itself by saying that it is not bound to accept the lowest offer?
Viscount Cranborne: My Lords, the noble Lord knows as well as I do that the lowest offer is not always the best offer, and we certainly take that into account.
Lord Williams of Elvel: My Lords, given the question asked by the noble Lord, Lord Marlesford, which is very relevant in the circumstances, can the noble Viscount now give an undertaking that British troops who go into any sort of engagement under whatever standard—United Nations or British—will be properly supplied with ammunition made in Britain by British people?
Viscount Cranborne: My Lords, perhaps your Lordships will allow me to answer the noble Lord, Lord Williams, in this way. The spin which, as a distinguished cricketer, he puts on an apparently simple-minded question is always one of which any Minister has to be careful when replying. I have already made it clear that we should like to make sure that certain key areas are supplied from here. At the same time, we are perfectly satisfied that there are other areas which are properly open to competition, particularly from companies operating from within the national membership of the IEPG. Obviously, we shall keep the situation under review. But a level playing field and competition of the kind I have described are beneficial not only to the performance of the kind of ammunition that we procure, but also in terms of value for money for the taxpayer, which is something that I know the noble Lord keeps well in mind when asking questions.
Baroness Seear: My Lords, does the noble Viscount agree that it would make a very pleasant change to have a flat floor instead of a level playing field?
Viscount Cranborne: My Lords, the noble Baroness is absolutely right. I am well aware that I have been using an over-used cliché; it will be my firm endeavour to change.
Lord Peyton of Yeovil: My Lords, since the level playing field has come up again, I wonder whether my noble friend agrees that that is something worse than a cliche; it is a fairy story.
Viscount Cranborne: My Lords, I have already said to my noble friend Lord Ironside—and I repeat this to my noble friend Lord Peyton —that we are not yet satisfied that our partners in the IEPG are playing as clearly on whatever expression I dare to use now. We are doing our best to make sure that we improve it. Whether it is a level playing field or anything else, it is clear that our new procurement policy has greatly improved the value for money that the British taxpayer is getting. I have given as an instance the 50 per cent. saving in costs for heavy ammunition.

British Coal and British Rail (Transfer Proposals) Bill
3.7 p.m.
Report received.
Clause 1 [Power to act in relation to proposals for transfer of functions, property etc.]:
Lord Clinton-Davis Lord Clinton-Davis moved Amendment No. 1:
Page 1, line 9, after ("transferee"),") insert ("provided the conditions specified in subsection (1A) below have been satisfied,").
The noble Lord said: My Lords, in moving this amendment, which stands also in the name of my noble friend Lord Underhill, perhaps it will be for the convenience of the House to consider also Amendment No. 3. I suppose that it is all about level playing fields.
The strict effect of these amendments is to prevent the British Railways Board from using its powers under the Bill until the information which has been set out in Amendment No. 3 has been published. That information relates to the Government's timetable for privatising British Rail. It relates also, among other matters, to the costs incurred in pursuing those proposals. That is in paragraph (c).
I justify this requirement on a number of grounds. First, there is considerable uncertainty about the timetable adopted by the Government and that is creating a substantial number of major problems for the board of British Railways. The amendment addresses that point but it also addresses a wider issue. The uncertainty is also causing problems for others; for rail travellers. They are very unclear about what is happening. It is causing problems also for local authorities, which have to face decisions about whether new rail investment should be supported. They are very unsure about which way to turn. At a time when both central and local government are trying to encourage greater use of public transport, this uncertainty is less than helpful.
The amendment is also designed to enable the Minister to shed rather more light than he has done previously on what is at present a very murky area. If the Minister were to argue—I hope he will not—that there is no need for him to engage in that task, I would say that a look at Hansard for the Committee stage of the Bill would destroy any such illusion. In referring to the 50 or so expressions of interest that the Government have received from the private sector in running franchised services, the Minister said:
"A useful response has been received from a wide range of interested parties, including nearly 50 expressions of interest in running franchised services and about 10 in leasing rolling stock. My right honourable friend is now considering the responses received to that document and hopes to be in a position to announce early in the new year the first services to be franchised".—[Official Report, 30/11/92; col. 1218.]
At col. 1240 the Minister had this to say:
"Turning to rail privatisation, while the Government have received a number of expressions of interest in response to their franchising consultation document, it is far too early to know whether that interest will develop. Nor can it develop properly until the details of the transfer powers and other provisions in the main legislation have been considered".
In my submission, that second contribution introduced some doubt about the nature of the response to the franchising document and to the Government's intentions in consequence. It would be helpful if the Minister were to update the House on the nature of the response to the consultation document and also explain when the Secretary of State will in fact be making his announcement. There is some little
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doubt about that. The original date was for the end of the year. Then it was to be announced early in the new year. Perhaps the Minister can clarify the position.
There is also a measure of uncertainty about the Government's proposals for access and charging. This is an area with potentially major ramifications for the viability and costs of the rail services. We know that Coopers & Lybrand was commissioned by the Government to undertake a report into this matter. Indeed it is referred to in the White Paper specifically and referred to further in the franchising consultation document which stated that the Government planned to make their decision on the principles known by the end of 1992. That looks as though it has slipped a little. I would argue that because of the fundamental importance of this issue the Government should consult on the outcome of the consultants' report before publishing any conclusions.
I referred to the next matter briefly during the Committee stage. It was reported in the Independent on Sunday sometime last month that the Government had decided not to publish the consultants' report and they planned instead to publish their own report setting out a financial regime for sharing track costs. I pressed the Minister on these issues at the Committee stage. I asked him to comment on the accuracy of that report, to indicate whether there was any reason why the Government should not publish the consultants' advice and to confirm that there would be full consultation on this aspect of the Government's proposals. That was set out at col. 1297 of the Official Report of the second day of the Committee stage. This is what the Minister said in response:
"Coopers & Lybrand have been providing advice to the department as part of the work on the charging regime. That work is still under consideration. The results will be published shortly".—[Official Report, 1/12/92; col. 1299.]
Again, it would be helpful if the Minister could confirm precisely what is going to be published. Is it to be the Coopers & Lybrand report after all, or is it to be a government report? Will the publication be a consultative document or a statement of government policy? Will the document deal with access and charging principles? When precisely will it be published?
These are two examples only of the uncertainties surrounding the programme and intentions of the Government. They both arise from the Committee stage on 30th November and 1st December. There is also a good deal of media speculation about the Government's timetable in relation to the main legislation and the introduction of franchising. A good deal of this uncertainty, which is not helpful, could be overcome if in response to the amendments the Minister could give a statement of the Government's intentions. I would hope that the statement could cover the likely timetable for the main legislation, the publication of further consultation documents and reports and the implementation programme, particularly in relation to franchising and the establishment of Railtrack.
Finally, perhaps I may deal with the question of costs, which is picked up in paragraph (c) of Amendment No. 3. It is important that Parliament should ensure that the Government get value for

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money from their expenditure. At some date in the future the Government's work on privatisation will be scrutinised by the Comptroller and Auditor General and the Public Accounts Committee. But meanwhile we have a right to know what expenditure has been incurred and what is planned. Not only are we entitled to that, but the country is entitled to it, because the costs are likely to be very substantial. I beg to move.
3.15 p.m.
Lord Ezra: My Lords, I support the amendment. It will be well known to the House that there is a considerable amount of concern about the way in which the railways are to be privatised under the Government's announced intentions. A large proportion of the population are affected by the efficiency with which our system operates. Doubts have been expressed about whether the proposals announced in the White Paper will lead to an improvement and whether the additional investment which most agree is necessary will be forthcoming. I should have thought that this is one area of privatisation where the Government ought to proceed with a certain amount of caution and step by step. The further step proposed in the amendment seems to be one which would help to alleviate growing public concern.
Lord Underhill: My Lords, before the noble Earl replies perhaps I may add two brief points. Does he remember that the Central Transport Consultative Committee, which is a statutory body, issued a report in which it stated that the White Paper is a statement of intent rather than a document giving clear detail as to how proposals will work out in practice? That is what the amendment is seeking. Has the noble Earl seen today's piece in the Guardian about a report issued by the Confederation of British Industry? I have not seen the report. I can only refer to the statement in the Guardian. It says:
"The Government's proposals for rail privatisation lack clarity and detail".
It goes on to say:
"Far from encouraging private sector interest, there is a danger that privatisation will be a blueprint for bureaucracy". Those statements add to what my noble friend said when he so comprehensively moved the amendment.
The Earl of Caithness: My Lords, as the noble Lord, Lord Clinton-Davis, reminded the House, we covered a great deal of this ground in Committee. The amendments have to a large extent been met by what my right honourable friend the Secretary of State has said; nevertheless, I am happy to take this opportunity to give the House the information for which the noble Lord asked. First, the amendment requires my right honourable friend to publish his proposals for the future of British Rail. He has done so in the White Paper, New Opportunities for the Railways, which sets out the Government's proposals for the privatisation of British Rail. In paragraph 99 the White Paper makes it clear that legislation will be introduced to implement the proposals. That answers the second element of the amendment.
The next part of the amendment asks for timetables. As your Lordships' will be aware, the White Paper was published in July. The main
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privatisation legislation will be introduced as soon as we are in a position to do so. The Government are of course anxious to make progress in improving the quality of services to rail customers and therefore to have the necessary legislation in place as soon as possible.
The next element of the amendment asks for timetables for the publication of any consultation documents and reports commissioned from consultants. We published the consultation document on the franchising of British Rail services in October. In November we published a consultation document on the future status of the British Transport Police. We shall be publishing tomorrow a document setting out our views on representation. We intend to publish our proposals on access and charging early in the new year.
My right honourable friend has just received advice from the Health and Safety Commission, following a study of the safety implications of our rail privatisation proposals. My right honourable friend will want to consider carefully the recommendations put forward. We expect to publish the advice in January. We intend to publish a policy paper on pensions early in the new year. We shall issue a paper early in the new year setting out our proposals for investment in passenger rolling stock. We aim to announce our preferred options for freight in the first part of next year, following Mercer's study into the restructuring of British Rail's freight businesses.
As your Lordships will realise from what I have just said, an immense amount of information has been made public, and there is still more to come. The next part of the amendment is about franchising. As we have previously made clear, we hope to make an announcement early in the new year about the first services to be franchised. We hope to let the first franchises from April 1994. The separation of BR's track and operational responsibilities will take place when we establish Railtrack which we are planning should take place on 1st April 1994.
Finally, I turn to the last part of the amendment which refers to expenditure on privatisation. So far as concerns BR's expenditure, we believe that there is appropriate provision in the settlement for BR announced at the time of the Autumn Statement, but it is for BR to decide within its EFL. Details of the department's expenditure in connection with the privatisation of British Rail are included in the Supply Estimates approved by Parliament. For the current financial year (1992–93) that sum amounts to £3.35 million.
Lord Clinton-Davis: My Lords, I thank the Minister for that helpful reply. He gave a number of important details which had not been given previously, and the House will appreciate that. We shall be referring to pensions in another amendment, but we shall wait with considerable interest to see what he says about that in the policy paper. To leave BR to decide how much will be spent on that does not carry us very much further. Do the Government have no idea from discussions that they have had with BR what the likely amount involved in the privatisation

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expenditure will be? Is the Minister unable to tell us? I am happy to give way to enable him to respond to that point.
The Earl of Caithness: My Lords, with the leave of the House as this is Report stage, on this occasion I hope that the House will permit me to say that it is entirely for BR to decide. Much of its expenditure will depend upon the timing of this Bill and the next.
Lord Clinton-Davis: My Lords, the public will want to know. Whether we will obtain that information from BR is open to doubt, but we shall return to that issue later. While the Minister has been helpful, I am bound to say that I do not believe the process towards privatisation is as easy as he suggests. We have a number of policy papers, consultation documents and so on coming. That indicates that the Government have not yet made up their mind about a number of critical issues, particularly in relation to franchising and the role of freight. However, as the Minister has said, we shall be able to examine that issue later. I thank him once again for his response. In those circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Clinton-Davis Lord Clinton-Davis moved Amendment No. 2:
Page 1, line 9, after ("transferee"),") insert ("(and the transferee has agreed to fulfil the conditions specified in subsection (1B) below)").
The noble Lord said: My Lords, it may be for the convenience of the House if we discuss also Amendment No. 4. This is very much a probing amendment. It arises because of the deep anxiety that has been expressed about the possibilities of redundancy in relation to or in anticipation of privatisation. In recent weeks BR has declared 5,000 redundancies, and there are reports of a further 20,000. I hope that they will not come about, but nonetheless there are widespread reports published in the respectable press.
Against that background considerable uncertainties remain. They affect most of all the workforce and those who depend upon it. As one goes into this area of privatisation, there is no doubt that it is a very uncertain world indeed. We know that there has already been a setback in relation to Charterail. It was an unhappy episode. I shall not comment upon it further as the firm for which I consult represented Charterail. So I had better not say too much about that, but the fact is clear. It was a setback suffered not just by Charterail but by the Government because of their intentions to transfer more freight from road to rail. We shall no doubt return to that point in further debates.
One has only to see some of the comments made in yesterday's "Panorama" programme which spelled out those uncertainties. The noble Lord, Lord Ridley, expressed his deep anxiety about the private sector and the subsidies that it would require. He said that loss-making lines were not an industry but a service. One has a problem with a continually loss-making
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industry because at the end of the day one does not know how much public subsidy to give a private concern.
My noble friend Lord Underhill has already intervened in relation to the CBI report. I have not seen it, but it has been quoted widely. Against that background, doubts and uncertainties prevail. I cannot help feeling that in this area franchisees—if there are any who take up the franchises, and I suppose there will be—will be placed in a somewhat precarious position, at least for some considerable time. Uncertainties as to the amount of subsidies to be provided, whether or not they are to be monopolies and so on will add to those uncertainties.
I raise that issue in the light of a recent case far removed from the railways affecting Clark's ice cream company. It was the second largest ice cream manufacturer in the country having taken over part of the business from Lyons. The company recently collapsed. Some 128 of its employees discovered that the company could not meet the redundancy payments to which they were entitled. If that can happen in such a company, it can happen anywhere. It is therefore important that the Government spell out the assurances that they can give in order that the anxieties of many railway workers can be allayed.
The amendment is a probing amendment. We spell out in general terms one of the lines which might be taken. That might not be wholly appropriate but we wish to hear the Government comment not necessarily upon the amendment but on the spirit underlying it. I do not pose as an expert on redundancy issues, but I wish to know from the Government whether the ideas that I have expressed have any basis. If so, what do the Government propose to do in order to assuage the deep anxieties expressed across the industry? I beg to move.
3.30 p.m.
Baroness Denton of Wakefield: My Lords, the effect of the amendment, if it were directed at the substantive privatisation legislation, would be to require successor bodies to British Coal and British Rail to establish a fund of sufficient size to finance the redundancy payments which would have been available to employees of British Coal and British Rail had they not been transferred to successor bodies under that substantive privatisation legislation.
I have no objection to our discussing the subject today in general terms because even though it is not relevant to the Bill, I recognise that it is of genuine concern to all those who currently work for British Coal and British Rail. In the context of those privatisations, the Government attach great importance to the maintenance of employees' rights for those employed in the two industries. I can assure the House that all employees transferred under a transfer scheme in the course of the privatisation of British Rail and British Coal will receive the benefit of the provisions of the Transfer of Undertakings (Protection of Employment) Regulations 1981.
The noble Lord, Lord Clinton-Davis, spoke of an industry which is far removed from either of those under discussion today. Again, I point out that the

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assurances on entitlements will be properly safeguarded. That relates to the post-privatisation period as with the privatisations of Telecom, water and gas. The Government will ensure that suitable measures are put in place at privatisation to safeguard future entitlements.
If this House felt that it wished to provide in legislation for the measure in the amendment the time to do so would be when the main privatisation legislation was presented. It is an important subject and I hope that my assurances will be of value to the noble Lord. I also hope that he will accept that the provision is not appropriate for the Bill before us today and that he will withdraw his amendment.
Lord Donoughue: My Lords, I wish to speak briefly about the British Coal part of the Bill. Anxiety about redundancies is central to the discussions about the industry even more so than about British Rail. There is much consideration about the future of the rail industry but the worry is that the coal industry may not have a future. We welcome the total commitment behind the Minister's assurances.
Although we understand that general assurances are all that the Minister can give at the moment, and while on the whole they are received properly in this House, they do not provide individual miners looking to their future with a contented night's sleep every night. Miners need to see the detailed assurances and guarantees and the detail that will operate after privatisation and subsequent transferences. I hope that the Minister, her colleagues and officials, will bear in mind that the sooner the detailed assurances can be provided the better that will be for the miners whose jobs are threatened. We must bear in mind that according to the Rothschild scenario redundancies lie ahead for at least 20,000 miners. Even since the report was announced, 10 per cent. of the mineworkers' force in this country have taken redundancy. The issue is central and although we are grateful for the general assurances, individual miners need to see the specific guarantees.
Lord Clinton-Davis: My Lords, I am grateful to my noble friend for his comments on the coal industry. Sadly, both industries are affected by substantial redundancies. I echo his point that those who work in the industries should know precisely where they stand. However, the Minister has given a helpful reply and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 3 and 4 not moved.]
Lord Clinton-Davis Lord Clinton-Davis moved Amendment No. 5:
Page 1, line 14, at end insert:
("(1C) In the exercise of his powers under this section, the Secretary of State shall require transferees to guarantee the continuation of pension rights and concessionary arrangements for both existing and retired employees; and such guarantees shall apply in the event of subsequent transfer of the function of the relevant corporation to successive transferees.").
The noble Lord said: My Lords, the amendment deals with pensions. In a previous reply the Minister indicated that the Government will soon be publishing a document dealing with the situation. Although similar amendments were debated in Committee we
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thought it appropriate to table these amendments because the Minister's replies on that occasion were in some respects unsatisfactory and vague. We thought that we should give the Minister the opportunity to clarify the position. Perhaps she can do so notwithstanding the document which is to be produced on the rail industry. We have heard nothing about the coal industry in that regard and my noble friend may wish to intervene later.
In Committee the Minister was good enough to say that although she did not consider the Bill to be the right vehicle for discussing the issue, it was a matter of moment. Hundreds of thousands of people are likely to be affected by the pensions situation, and she did not consider it an unreasonable subject to be addressed in Committee. Indeed, nor could that be the case on Report.
The matter is important as regards potential franchisees. They must know where they stand in relation to the pension rights of others and their obligations in that regard. In preparing for privatisation, it is part of the job of both British Rail and British Coal to address the issues to the satisfaction of their employees past and present.
The noble Baroness said on 30th November at col. 1226 of the Official Report:
"As was the situation with previous government privatisations, we will ensure that the pension entitlements of existing contributors and of past employees of both industries are properly safeguarded".
Ministers have, of course, said that before. The noble Baroness then continued:
"There would be no circumstances in which a potential purchaser of the coal industry could be attracted by the potential of any predatory gains from the pension funds. Such an option could not be countenanced by the Government".
I hope that she can give chapter and verse as to what the Government will do when the situation is not only well on the road towards privatisation but when the industries have been privatised and the original franchisees or purchasers are no longer holding their purchase but have transferred it to some other entity. How can the Minister give the assurance she gave on 30th November? But I hope she will be able to reassure us.
Obviously no purchaser is going to say, "My motive in purchasing part of the coal industry or the rail industry is so that I can make a rich picking". A purchaser is not going to say that. But if the opportunities are there and if there are no satisfactory constraints, I believe that that will not be far from the minds of some. Not all people are honourable. Previous assurances have been given in relation to other privatisation measures. When British Rail hotels and Sealink were sold off I pointed out that the pension arrangements were far from satisfactory following those privatisations. The Minister said, again on 30th November, at col. 1227:
"The noble Lord earlier raised the subject of pension rights of employees of British Rail hotels and Sealink. We are aware of the arrangements that have been made and they are being taken into account in the arrangements that are currently under consideration for the future of the pension rights at privatisation under the present proposals. Those arrangements have been noted".
Implicit in that is a concession that the arrangements that had been made previously in relation to those two

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areas of privatisation, British Rail hotels and Sealink, were less than satisfactory. Otherwise the Minister could not have said that. That being the case, how can we be assured that the Minister is capable of giving the kind of assurances that she has given, and that they will be translated into practice? That is a matter of considerable moment.
The Minister then referred to the matter of advice. She stated at col. 1227 of the Official Report:
"British Coal and British Rail will wish to be well advised on the crucial issue of pensions".
I entirely agree with her on that point. But presumably the best possible advice was available when schemes did not work out as well as they should in previous instances. Can we be assured that the advice will be sought elsewhere than from those particular precedents? The Minister said later in reference to another point I made about converting the British Rail pension scheme into an industry-wide scheme that that was one of the options that the Government were currently considering. Presumably that will be dealt with in the document promised by her colleague, the noble Earl, Lord Caithness. Can we be told something about the other options that are under consideration? How many are there and what in general terms do they amount to?
There is another issue which we have raised previously that is not covered in this amendment. I shall press this point again because it is a matter of considerable importance. We firmly take the view, in the light of circumstances that have arisen in the fairly recent past, that pensioners or potential pensioners should be entitled to a proper share in the administration of their pension funds. I hope the Minister can elaborate a little more on this matter than she was able to do last time, particularly as regards the coal industry because, as I have said before, there appears to be no document on this issue as regards the coal industry—perhaps I am anticipating something—although we have heard that a document will be issued shortly as regards the rail industry. I beg to move.
3.45 p.m.
Lord Donoughue: My Lords, I wish to speak in support of my noble friend Lord Clinton-Davis. I apologise if my throat and voice finally give way before I finish speaking. As regards the coal industry, it is the widely accepted view that pensions must have statutory protection in the light of much recent experience. This will, of course, be subject to the Government's own general decisions in the pension field and we await the findings of the Goode Committee. However, it will be some time before that committee reports. I believe it has taken evidence today. Coalminers will wish to receive assurances well before the committee reports. We need guarantees on existing benefits for existing retired members of the industry and we need guarantees that present working contributors will continue to accrue rights even if they are, as miners, transferred elsewhere within the industry.
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I referred to an issue in Committee to which the Minister did not respond—a statutory guarantee as regards actuarial surpluses. We need such a guarantee. The House is probably aware that the surpluses in this area are quite huge but a pension holiday has been given to British Coal. It would be helpful if it was made clear that that pension holiday will not carry over to transferees. We all understand the problems the Minister faces in being specific at this stage and she has been very helpful, but it would be even more helpful if she could assure us that future arrangements will take account of this matter.
I wish to stress again what I said in connection with a previous amendment. The assurances are general but these are issues of great concern that can be resolved only when the detailed arrangements are available. We need detailed guarantees on pension benefits and on the provisions for change in pension arrangements. We need guarantees on surpluses, which I have just mentioned, and on the governance of pension schemes to ensure that the governance of pension schemes cannot be altered later to the detriment of schemes' members. I trust that the Minister and her colleagues will ensure that these areas of concern will be addressed and that the suggestions and remedies we have proposed—we proposed a number in Committee —will be positively considered.
I wish to pick up the important point raised by my noble friend Lord Clinton-Davis about subsequent transferees. It is no good having guarantees which operate only at the first stage because after selling on there would be no guarantees. It would be helpful if the Minister could assure us that all guarantees will apply to all subsequent transferees down the line.
Finally, the noble Earl, Lord Caithness, told us that a number of announcements were to be made about rail. He said that the Government will publish a statement on rail pensions in January. Will it apply just to rail pensions or will it also cover coal pensions? If it does not cover coal pensions, will the Minister give us some idea when there will be a statement on coal pensions?
Lord Ezra: My Lords, I should like to support the amendment. Although we raised the issue at Committee stage it is of such importance that I believe that we are justified in raising it again at this stage. In recent times there has been considerable debate about the validity of pension schemes, and the schemes which we are considering are very large indeed, affecting several hundreds of thousands of people.
My experience is related to the coal pension schemes. I can say that during the whole of the life of the schemes, from their inception in 1947 right up to the present, both contributors and pensioners have had complete faith in both the staff and the mineworkers' schemes. We are entitled to ask the Government that, in their privatisation measures for the coal industry, they ensure that that confidence can be maintained, bearing in mind in particular that, in the case of the coal pension schemes, a vast number of people are already pensioners and depend on regular receipts from that very well managed scheme for their livelihood. We are not talking about 10,000, 20,000 or 30,000 people; over half a million people are involved.

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Therefore, I should like to press the Minister to give us an assurance that when the legislation comes forward it will include some statutory provision to support the interests of both contributors and pensioners in the schemes.
Lord Ewing of Kirkford: My Lords, before the Minister responds perhaps I may detain the House a little longer. I apologise to your Lordships, because I come late to these debates. However, for many years I have had a strong interest in public sector pension schemes. In my days as an employee in posts and telecommunications, when that industry was part of the Civil Service, the pensions were non-contributory. When it became a public corporation pensions became contributory. When British Telecom was privatised during my service in another place the division of the pension fund caused deep concern. It still causes concern because British Telecom has taken a pension contributions holiday over the last two years while employees have continued to contribute.
The point that I wish to make, and which I am sure the Minister will take on board before she replies, is that in British Coal, which is being franchised, and British Rail, which is being privatised, we are dealing with industries which are in desperate need of massive investment for modernisation. That was not true in the case of other privatisations which have taken place, whether British Gas, British Telecom or British Airways. The need for massive investment was not as apparent as it is in the case of British Coal and British Rail. Against that background of the need for massive investment there will be a temptation for those taking over British Coal on the one hand and British Rail on the other to try to gain access to the resources of the pension funds in order to fund the modernisation that is so desperately needed. If any two industries ever needed their pension funds protected they are most certainly British Coal and British Rail. I hope that the Minister will take that on board in her reply.
Baroness Denton of Wakefield: My Lords, I thank noble Lords for their input on this subject. The matter of pension rights is not directly relevant to the Bill, but I recognise the real anxiety, both among those whose pensions and concessions will potentially be affected and among Members of this House, that those should be safeguarded. I assure the noble Lord, Lord Donoughue—and I hope that his voice lasts until the end of this Report stage, for the benefit of all—that no one recognises more the need for reassurance and for individuals to know what the future holds for them as soon as possible. However, I do not believe that we help those individuals by indulging in speculation in advance. I believe that in this situation it is important to bring the coal review to the House as soon as it is reasonably possible to do so.
The noble Lord, Lord Clinton-Davis, asked for assurances. I am sure that he appreciates that on this occasion I can give only a general assurance and that specific matters will have to wait until the detailed arrangements on these matters are brought forward with the main legislation. The noble Lords have given
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us a full picture of the matters which are of concern and to which they will draw our attention when the main legislation comes forward.
Perhaps I may also assure the noble Lord, Lord Clinton-Davis, that the Government take note of the experience of previous privatisations and use that knowledge to the benefit of restructuring. I endorse the comments of the noble Lord, Lord Ezra, concerning the respect for the British Coal pension fund and the unique relationship between the number of pensioners and the number of working miners, which is very special. Those factors are well known and are borne in mind.
I can tell the noble Lord, Lord Ewing, that we shall take account of the experience of the past. In the case of the privatisation of water there was a need for modernisation, and therefore some similarity with the present case.
Perhaps I may draw the attention of noble Lords to the fact that my honourable friend the Minister for Energy and my honourable friend the Minister for Public Transport have on several occasions given assurances that great attention will be paid to safeguards—assurances which my noble friend Lord Caithness and I have repeated here. The pensions of present contributors and former employees will be safeguarded at privatisation. In due course it will be for noble Lords to examine the strength of those safeguards when they come before the House.
If the findings of Professor Goode's pensions law review committee are available when the matter is brought before the House, then obviously they will be taken into account. Perhaps I may mention for the benefit of the noble Lord, Lord Donoughue, that the paper mentioned relates to rail only and not to coal, as he would expect. We have ahead of us, first of all, the coal review and then the issues which follow behind.
I hope that those assurances and the fact that we recognise the matters which are of concern to noble Lords will make it possible for them to withdraw the amendment.
Lord Clinton-Davis: My Lords, once again I thank the noble Baroness for her reply. I also welcome the intervention in these debates for the first time of my noble friend Lord Ewing whom I am delighted to see, as a very good friend of mine, on these Benches.
The Minister may rest assured that when the main Bill comes before the House we shall examine the strength of the safeguards to which she referred. On this occasion the Minister will have a great deal of time before we debate that Bill in this place and we shall wish to see the clearest possible assurances and details so that there can be no room for doubt on the part of pensioners, future and current.
In those circumstances I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 6 not moved.]
4 p.m.
Lord Clinton-Davis Lord Clinton-Davis moved Amendment No. 7:
Page 2, line 15, at end insert:
("(4A) Notwithstanding subsection (4) above it shall be the duty of the British Railways Board to write to the Secretary of State and to any authority calling for bids for franchises of functions currently run by the British Railways Board, detailing proposals—

(a) for the organisation of its functions, property, rights or liabilities to enable it to bid for the award of any franchise under privatisation proposals; and

(b) for the running of any service being offered for franchising.

(4B) Any proposals made under subsection (4A) above shall be considered by the franchising authority as bids for the franchises unless the Secretary of State makes an order that they shall not be so considered.
(4C) The power to make an order under subsection (4B) above shall be exercised by statutory instrument, which shall be subject to annulment in pursuance of a resolution of either House of Parliament.").
The noble Lord said: My Lords, this amendment deals with the duty of the British Railways Board to respond to the bids for franchises that are called for by the Minister. We have discussed this matter in some depth, but I found the replies of the Minister less than satisfactory.
There seems to be a colossal inconsistency between the Government's position in relation to the right of a public authority to be able to tender for agreements in this respect and its rights in other respects. Let us take the case of London Underground. London Underground has been operating competitive tendering in engineering and support activities for many years. Until last year, there was a joint working party between management and unions to review the position. The public sector won two out of four contracts outright in, I think, 199I—certainly it was around that time.
Some three-quarters of contracts put out to tender in local government and in the health service have stayed in-house. The Government have not objected to that. They have said that they want value for money. But somehow in this case the Government have refused—I shall come in a moment to whether or not they are entitled to do so—or have purported to refuse British Rail the right to make a tender bid.
Research was undertaken recently at the London Business School which showed that for local authorities which took on private contractors for refuse collection ahead of compulsory competitive tendering, after an initial saving the costs rose considerably. The argument that is adduced is that without an in-house service to sustain competitiveness, contractors are free to take advantage of the authorities and there is a case therefore for maintaining an in-house service so as to keep sufficient technical expertise to be able to monitor and evaluate contractors. So how would British Rail be able to go about that in the future? After all, even on the Government's showing, it will continue to be a powerful entity.
In my judgment the Minister has failed to address three essential points in the response that he made to the amendment when we discussed it at Committee stage. He confirmed that British Rail would continue
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to operate services either where franchising is not being introduced or where the franchising authority rejects bids from the private sector. He said that on 30th November (Hansard, col. 1232).
So there is a danger in that scenario that British Rail will become—I used this phrase last time—an operator of last resort. It is likely that the last areas to be franchised will be those with least commercial opportunities. That is very clearly the view of the Minister's noble friend Lord Ridley, who said last night in the "Panorama" programme that the Government had picked all the plums out of the privatisation pudding and British Rail would continue as a loss maker. He said that he did not know the extent of the subsidies that would be required. I have not quoted him exactly, but that was the purport of it. The Confederation of British Industry added in the programme that the rail proposals lacked clarity and detail. There can be no greater example of that than in this instance.
So private sector bids are less likely to be acceptable in the circumstances I have described in relation to those areas with least commercial opportunities. It looks as though in those circumstances British Rail will be left with the prospect of operating difficult services but with no incentive to develop and improve them.
The Minister went on to say (at col. 1232):
"Of course, it will be open to the franchising authority to reject all bids from the private sector should none represent value for money, in which case BR would continue to operate the service".
So he rather corroborates the point that I have just been making.
What the Minister failed to explain is how the franchising authority would reach such a decision if British Rail were not in a position to bid. There is no single value-for-money factor which can possibly be used. If BR were in a position to bid it would automatically provide a benchmark against which private sector bids could be considered. It would provide British Rail with an incentive to prevent it becoming an operator of last resort.
It seems that the Minister is objecting to BR bidding for franchises because it would limit the opportunities for private sector involvement. How does he reasonably sustain that posture? BR's monopoly, about which the Government are so concerned, would no longer exist. If the private sector bidders are as innovative and imaginative as the Minister considers, the franchise authority would accept their bids rather than those of British Rail. If the private sector's bids are not as attractive as those of British Rail, why should not British Rail continue to operate the service? I think that the Minister has to reply to those points.
My final point relates to European Community law. Is it in fact consistent with Community law that British Rail can be excluded from this process? Is it consistent with the law relating to public procurement, or indeed with competition law? Perhaps the Minister would let us have his views on that point. I beg to move.
The Earl of Caithness: My Lords, I was very surprised to see this amendment on the Marshalled List. As your Lordships are aware, an exactly similar amendment has already been discussed at some length. The purport of this amendment is exactly the same as Amendment No. 5 moved at Committee stage. We spent a lot of time on it in Committee. The noble Lord has spent nearly eight minutes on it now. It was negatived at Committee stage and it rather goes against the Standing Orders of the House that we have to discuss the matter again. The noble Lord has brought no new issue before us.
I have explained that our policy for the railways is genuinely one of privatisation. We see very real benefits to passengers from the transfer of responsibility for running services from the public to the private sector in terms of new management, new approaches, fresh thinking, greater responsiveness to passengers and greater efficiency. It is our policy that BR should not be allowed to bid for franchises. It amuses me that the noble Lord, Lord Clinton-Davis, now calls in aid his old enemy, the noble Lord, Lord Ridley. For years I suffered in the Department of the Environment when he was a commissioner. My noble friend Lord Ridley could do absolutely no right in this world. It now appears that he can do no wrong.
Through franchising we intend to seek the greatest possible involvement of the private sector in the provision of services while retaining a necessary and clearly defined role for the public sector in the form of the new franchising authority, in specifying the services that are needed, on setting minimum quality standards and in paying subsidy. I have made it clear before and do so again that we will continue to have subsidy available for franchises where necessary. There is no reason to suppose that franchising will be restricted to profitable or to commercially attractive services.
I believe that it is misconceived to think of BR submitting a bid for a franchise as a public sector body. Of course the franchising authority will be able to look at the cost of BR continuing to provide a service, and we have made clear that it will not be obliged to grant a franchise should it not deem any of the bids it receives to offer good value for money. If no franchise is granted, BR will continue to run the services until a successful competition has been held.
The nub of the question comes down to one of whether BR should be allowed to bid for franchises. The noble Lord, Lord Clinton-Davis, says that it should. We wish to involve the private sector as much as possible. That is for the benefit of the consumer. That will be for the benefit of the railways. And that is why—
Lord Clinton-Davis: My Lords, before the noble Earl sits down—
The Earl of Caithness: I have not sat down.
Lord Clinton-Davis: I am sorry, I thought that the noble Earl was about to do so. He looked as though he was gathering his papers in the way that the noble Baroness, Lady Thatcher, used to gather her handbag,
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and I was a little worried. Will he deal with the point about European Community law, to which I addressed some comments?
The Earl of Caithness: My Lords, so far as I am aware none of our proposals contravenes European Community law, but I will look into the specific point.
Lord Clinton-Davis: My Lords, I was right. The noble Earl was about to sit down; I therefore seized my opportunity. The noble Earl has neither addressed the issues any better today than previously nor has he begun to confront them. He just ignores the evidence and the inconsistencies. The inconsistencies are apparent to all because they have arisen right across the local authority sector, right across a number of public authorities, including London Underground and many others, and he has given no compelling or convincing answer why British Rail should be excluded.
The only thing one can say is that the Government are wracked with dogma, and not for the first time. I am surprised that the Minister can say nothing more about the issue of European Community law. He says he believes—he may even be convinced himself—that there is nothing in the point that I have raised. But again he has not argued the point. It is pure assertion that he is satisfied that European Community law is met. The House is entitled to more information from the Minister than we have received.
One cannot satisfactorily resolve these issues in oral questions because the Minister cannot be sufficiently probed on such occasions. Perhaps the Minister would care to write to me on the issue. It is of considerable importance in relation to public procurement law and in relation to competition law. I am not satisfied with what the Minister said. I hope that he can indicate with a nod of the head—because without the leave of the House I think that is all he can do—or perhaps with the leave of the House answer the point I have made and say whether he will correspond with me about that issue. May I give way to the Minister on that point before I sit down?
I am disappointed. I get letters like confetti from the Minister. Why I cannot get one on this little occasion I have no idea. Why is he so unforthcoming? The law can be stated for him. He has the legal services available. I hope that he will reflect further on the matter. Meanwhile, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.

Copyright (Computer Programs) Regulations 1992
4.14 p.m.
Viscount St. Davids Viscount St. Davids rose to move, That the draft regulations laid before the House on 25th November be approved [13th Report from the Joint Committee].
The noble Viscount said: My Lords, these regulations amend the 1988 Copyright Designs and Patents Act in order to implement a Council directive on the legal protection of computer programs (91/250/EEC), which is due to be implemented in

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member states before 1st January 1993. I am pleased to tell noble Lords that the 1988 Act already complies with the main thrust of the directive, which is to afford copyright protection to computer programs and to grant copyright owners the same rights as for other literary works. Indeed, computer programs have been protected by copyright in the United Kingdom for some time, and the directive may be seen as an upward harmonisation to United Kingdom levels, which will increase protection for software products across the Community. An increase in legal protection in other member states will provide greater opportunities and greater confidence for industry to exploit markets elsewhere in the Community.
The regulations implement those provisions of the directive which do not precisely correspond to our current law. There are some changes to the scope of the rights enjoyed by owners of copyright in computer programs, some changed definitions, and some restriction on contractual freedom. The provisions all reflect the special nature of computer programs and will render the Act more relevant to the needs of both creators and users of programs.
Perhaps the most important of the changes is the exception to copyright which allows a user to convert a program from the form in which it will run on a computer into a form in which it can be read by a human programmer. That is to "decompile" the program. Because decompiling a program entails adapting and reproducing it, both of which are rights belonging to the copyright owner, this problem was the subject of intense debate during negotiations leading to the adoption of the directive. A balance was reached which allows users to decompile programs, but only in order to create programs which are able to work together. The rights of copyright owners are not eroded while greater opportunity for competition will be achieved.
Moved, That the draft regulations laid before the House on 25th November be approved [13th Report from the Joint Committee]—(Viscount St. Davids.)
Lord Peston: My Lords, I thank the noble Viscount, Lord St. Davids, for introducing the material before us. Essentially what we are discussing is copyright protection for computer programs. I have certain views on the subject, but I do not intend to air them today because the regulations are introduced to implement a Community directive. There is no point in arguing about it if such a directive exists, because that is what we are obliged to do.
I have only one question for the Minister, which I hope that he can answer. Can he assure me that the regulations are in conformity with the directive both precisely and entirely? That is my simple question. I hope that he can answer yes to both parts.
Viscount St. Davids: My Lords, I know that the noble Lord, Lord Peston, takes a particular interest in the law concerning copyright and patent and is well advised. I can give him the assurances that he seeks.
Lord Avebury: My Lords, may I ask the noble Viscount a couple of questions which arise from my
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interest in programs as a humble user and as the occasional writer of elementary pieces of software? The noble Viscount will be aware that there are many pieces of software that reside in the public domain and which can be accessed via bulletin boards, such as C routines, which can be incorporated in other programs. If somebody purports to copyright a program that contains these routines, does the copyright exclude those parts of the whole program which were formerly in the public domain and which are now incorporated in his application?
Secondly, as a result of this instrument do we have anything comparable in our law to the American "look and feel" legislation where if somebody writes a piece of software that emulates another program he may well have violated their copyright law? The noble Viscount will probably be aware of the expensive court cases that have occurred in the United States.
For example, if one buys a program which achieves a particular objective and it happens to be written in Pascal, and one achieves exactly the same objective so far as the user is concerned with exactly the same kind of interfaces to the user but one has written it in C, is that a violation of the copyright of the person who wrote the original program in Pascal? If the noble Viscount does not have the answer to those questions immediately, I should be grateful if he could write to me on some future occasion.
Viscount St. Davids: My Lords, I think that I can answer the first part of the noble Lord's question. I understand that copyright exists in the part of the program which is the intellectual input of the person who compiled the program. If, in putting together a long program, he takes pieces which are already in the public domain, they remain in the public domain and the copyright property belongs only to the person's own intellectual input. As to the second part of the noble Lord's question, I will write to him.
On Question, Motion agreed to.

Armenia and Nagorno-Karabakh
4.30 p.m.
Baroness Cox Baroness Cox rose to ask Her Majesty's Government what is their policy towards recent developments in Armenia and Nagorno-Karabakh.
The noble Baroness said: My Lords, I am deeply grateful for this opportunity to raise in your Lordships' House the grave situation in Armenia and in Nagorno-Karabakh. I thank very warmly all noble Lords who will taking part in this debate. I know that their contributions will be greatly appreciated by the people who are suffering in that part of the world, afflicted by both natural and man-made catastrophes.
I have linked Armenia and Nagorno-Karabakh because their tragedies are inter-related. Although the small enclave of Karabakh, which used to be part of historic Armenia, was cruelly relocated by Stalin in Azerbaijan in the 1920s, its largely Armenian population have continued to live in their ancient homelands. But as Azerbaijan has escalated its military offensives against Nagorno-Karabakh, many thousands have had to flee to Armenia, where the

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situation is also desperate, with acute shortages of essential supplies caused by the blockades imposed by Azerbaijan and also by the hindrance to the free passage of supplies by Turkey.
These blockades are grave violations of human rights, causing immense suffering and economic harm to Armenia and to Karabakh. Moreover, Armenia is still suffering from the effects of the massive earthquake in 1988, with thousands of its own homeless people. With the onset of winter, the plight of Armenia is perilous. There are desperate shortages of food, fuel and energy, and many thousands of displaced people and refugees.
As my noble friend Lord Shannon is chairman of the British-Armenian All-Party Parliamentary Group, he will be speaking primarily about Armenia; and as I have had the privilege of visiting the brave citizens of the beleaguered, blockaded and bombarded enclave of Nagorno-Karabakh seven times this year, I shall focus on their predicament.
I have been to Nagorno-Karabakh under the auspices of two organisations, the Andrei Sakharov Foundation and Christian Solidarity International, or CSI for short. Both are concerned with violations of human rights and the humanitarian needs of victims of repression, regardless of creed, colour or race. For example, we have sent aid to Moslem victims of the Gulf War and to the Azeri victims of the Karabakh conflict. However, our main endeavours in this region have been directed to the Armenians of Nagorno-Karabakh because it was Sakharov's principle to be on the side of the victim, and the evidence shows that it is the Armenians who are the primary victims in this cruel conflict.
I must stress that this is not a religious war, as such. Previously, Christians and Moslems in Nagorno-Karabakh lived peaceably together, attending each other's weddings and funerals. But last year Azeri forces combined with the Soviet Fourth Army to carry out brutal deportations of entire Armenian villages from Shaumyan and Karabakh itself. These operations involved murder, rape, torture and pillage. Some survivors now live as refugees in appalling conditions in Armenia or in the rest of Karabakh. I visited some of these families in October, who were living in water tanks which will now be unbearably cold in the bitter winter. Food shortages were so acute that one family of 10 had only three potatoes to share between them for a whole day.
In spite of the deportations, the Armenians of Karabakh agreed last summer to forego their wish to be reunited with Armenia. They agreed to accept their longstanding status under the former Soviet empire as an autonomous enclave within Azerbaijan. In other words, at that stage they were not in any way violating territorial integrity. But in the autumn Azerbaijan responded unfortunately by announcing that it would annul Karabakh's autonomous status, and it threatened to rename its capital city, Stepanakert, with a Turkish name. Faced with those threats, the people of Karabakh resorted to what they perceived as desperate measures to protect their rights, including a referendum on their future, which resulted in an overwhelming majority in favour of a declaration of
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independence. Since then, the Azeris have escalated their aggressive policies into all-out military offensives.
The people of Karabakh have fought back, but the forces have been massively asymmetrical. The 160,000 Armenians of Karabakh faced 7 million Azeris, armed to the teeth with weapons taken from three major Soviet Fourth Army arsenals. The Azeris have also been aided by 40 senior Turkish army officers, who took early retirement, as well as Russian and Ukranian pilots flying fighter bombers. It is truly a David and Goliath situation.
The suffering in Karabakh is almost indescribable, with the twin effects of blockade and bombardment. In January I saw civilian casualties, with burns, amputations, glass in eyes and bullets in spines. The doctors and nurses had no anaesthetics or analgesics: only vodka, to try to alleviate the suffering. I could not sleep on my return to Britain, thinking of their suffering. CSI then authorised funds for the purchase of necessary drugs. The Home Office was very helpful and gave an export licence: within 12 days we were back in Karabakh with morphine and other necessities. I must report that the International Committee of the Red Cross did not enter Karabakh until four months later and other major aid organisations, with the notable exception of Médecins sans Frontières, have not been able to work in Karabakh because of the blockade and because of Azerbaijan's hindrances.
When we returned in January, the Azeris had begun to use what anyone who knows them must recognise as fearsome weapons—GRAD multiple missile rocket launchers—on civilians. When we went back in March we saw the results of those terrible weapons. The city of Stepanakert and the surrounding villages were being reduced to rubble. The level of bombardment was horrific: on one typical day in March I counted 400 GRAD rockets fired from the hilltop town of Shushi by the Azeris on to the civilians of Stepanakert and surrounding villages. I emphasise that that was a typical day.
Due to this constant bombing, the civilians of Stepanakert and the surrounding villages were having to live in basements and cellars with no light, heat, running water or sanitation, as the Azeris had cut off essential supplies of fuel, electricity and water. The only lifeline was provided by courageous pilots, who flew small twin-engined jet aircraft or two-tonne helicopters, bringing in meagre supplies of medicines, food and fuel and carrying out the most serious casualties. Those pilots flew incredible manoeuvres against the sun, to try to deflect the heat-seeking missiles. Sadly, on a flight out last summer, I saw the wreckage of a plane, flying out casualties, that had been hit by such a missile.
In May, Armenian self-defence forces captured the hilltop town of Shushi, which the Azeris were using as a GRAD launching base, in order to stop the complete annihilation of Stepanakert and its people. They also forced open a land corridor between Karabakh and Armenia, taking some Azeri territory and the town of Lachin in the process. They were criticised by the international community for violating the principle of

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territorial integrity. But if Azerbaijan had not been imposing that vicious blockade—itself a violation of human rights—it would not have been necessary to open a corridor; and if the Azeris had not been using Shushi as a base for GRAD missiles to rain down death and destruction on Stepanakert, the Armenians would not have had to risk everything in the seemingly impossible task of capturing a mountain fortress.
After the Azeri elections in June, the new government in Azerbaijan mounted a huge offensive against Karabakh in an attempt to impose a "military solution". They succeeded in overrunning 40 per cent. of Karabakh, as well as the Armenian-populated region of Shaumyan, forcing over 50,000 refugees to flee to the devastated and starving city of Stepanakert or into Armenia. The Azeris have since continued to escalate their military attacks. In August I witnessed SU25 bombers dropping massive 500 kilogramme bombs on civilians in Stepanakert and the villages. By October the Azeris had added cluster bombs to their repertoire of brutality. The civilian casualty rate doubled. Now, new long-range artillery is being used to pound Stepanakert and other parts of Karabakh, causing civilian deaths to be reported up until the last few days.
There is one other disturbing aspect which I must highlight before I begin to draw to a conclusion. As the debate is taking place so early this afternoon, I hope that I may be allowed to put this matter on the record because it is so important and we are not under a great pressure of time. I refer to the brutality with which Armenian hostages are treated by Azeris. In April my colleagues and I visited a village in the north of Karabakh which had just been overrun by Azeri forces which had since withdrawn. Homes, still burning, had been pillaged and set on fire. Forty-five villagers had been massacred and many had their heads sawn off. Vertebrae were still on the ground and blood still on the walls. The people reluctantly showed us the charred decapitated corpses of their families.
Also, earlier this year we met three hostages who had just been released from Azeri custody. One woman with her four year-old son had been passed from military unit to military unit. She was appallingly mutilated and still bleeding from wounds inflicted that morning. Her little boy had fractures. A man released at the same time had been in Azeri custody for three years. He was aged 41 but he looked 70. He had old and recent fractures and scars. He was a physical and psychological wreck.
More recently in October, five more women were released, still bleeding from fresh beatings. They said that the Azeris told them that they could not wait to get into Karabakh to kill every Armenian, especially the women and children. By contrast, my colleagues from the Sakharov Foundation and I have interviewed Azeri prisoners held by Armenians. With the exception of one soldier who in our view was not receiving adequate medical treatment, we were entirely satisfied that the conditions of those whom we saw met international criteria.
Azeris and Turks often refer to the alleged massacre by Armenians at Khodaly earlier this year. Your
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Lordships may remember the headlines across the Western press that thousands of Azeris had been massacred by Armenians. Western press gave massive coverage to the tragedy as portrayed by the Azeris, who have given open access to their evidence and to their version of events. Undoubtedly it was a tragedy and many Azeris died. However, the Armenian account has never been published, access to Karabakh being extremely difficult because of the blockade. The Armenian version has since been corroborated by the former President of Azerbaijan, President Mutalibov.
The Armenian version of that so-called massacre was that they undertook an attack on the town of Khodaly. They had to do so because the Azeris were using it as a base for launching GRAD missiles against Stepanakert. That is true; I can vouch for it. The Armenians also knew that civilians were there and they gave advance warning of the attack. It was not in their self-interest to warn a base that it was about to be attacked, but that has been independently confirmed by Russians and others to whom I have spoken. They wanted the civilians to evacuate safely. When they arrived, they were dismayed to see that civilians were still there. They tried to arrange a safe exit but the Azeri soldiers refused and fled, intermingling among the civilians. The Azeris fired at close range so that the civilians were caught in the cross-fire with horrible injuries. The Armenians subsequently allowed the Azeris to return to the area to collect their dead and the bodies were used as a basis for the dramatic allegations of an Armenian massacre which swept across the world's headlines.
I have been to the front lines and have seen the men who are defending Karabakh. They are not mercenaries. They are doctors, lawyers, grandfathers, students, priests and 16 year-old boys. They all say that they do not want to fight; but they have to defend their homes, their families and their homelands. Seeing the condition of the women and children taken hostage by the Azeris, one can understand why the Armenians fight against such terrible odds with such desperate courage.
How long will the international community desist from prevailing upon Azerbaijan to cease its military offensive, which is another example of ethnic cleansing? The people of Karabakh have asked the international community for help. I know that the Government have made £250,000 available for humanitarian aid and I know that this will be a great comfort for the people of Karabakh. But there are reports that aid for Karabakh from international bodies has been stymied by Azerbaijan. May I therefore ask my noble friend what assurances she can give that this aid will definitely get through to the people of Karabakh?
However, the fundamental problem lies in the continuation of the conflict. The overriding priority must be a cessation of military aggression before there is another genocide. That that is a real possibility is reflected in Médecins Sans Frontières' inclusion of Karabakh in its list of threatened peoples. I would therefore like to ask my noble friend three questions on attempts to find a political solution to the tragedy.
First, I understand that the US Government's legislation concerning economic aid to the republics of the former USSR has excluded assistance to Azerbaijan until it lifts its blockades of Armenia and Karabakh, and agrees to an unconditional ceasefire. Will my noble friend indicate what similar initiatives the Government are taking to put pressure on Azerbaijan to desist from its brutal and aggressive policies?
Secondly, there was a disturbing report in the Independent on Sunday on 6th December of a visit by a senior delegation from the Azeri Government to Britain earlier this year to buy Russian arms for hard currency. They wanted arms compatible with those they already had, but could not obtain directly from Russia, as the Russians, reluctant to stoke the Azeris' war with Armenia, had imposed a ban on exports of arms to Azerbaijan. The British arms dealer, it was reported, asked the Foreign Office for permission to export those arms, expecting this to be denied. However, the Foreign Office apparently had no policy on this matter. May I therefore ask my noble friend if Britain might follow Russia's example—and there can be no country in greater need of hard currency than Russia—of refusing to stoke Azerbaijan's arsenal of weapons for its policy of military genocide?
Thirdly and finally, there is the vexed area of trade. A report in The Times a few months ago indicated that Western investment in Azerbaijan, such as that by BP. was providing resources to enable the Azeris to win the war against Karabakh. The Azeris have been delighted by recent visits of leading British politicians who have been seen to be endorsing and supporting the very government which are perpetrating this brutal war against the Armenian minority in Karabakh and against Armenia itself. Instead, surely, every opportunity should be taken to persuade the Azeris to turn from war to peace. It is Azerbaijan which has steadily escalated the war: from the imposition of the blockades to the deportations; from snipers and hunting rifles, to tanks and armoured personnel carriers, alazan rockets and GRAD missiles; and now to aerial bombardment and cluster bombs. How long can Britain accept such behaviour as a matter of internal affairs and implicitly condone this attempted genocide?
The Azeris are also suffering from the war, with thousands of casualties and refugees. But the war is of their making. The people of Karabakh are fighting for survival and for the right to continue to live in the land of their ancestors. Ancient Christian monuments go back to the fourth and fifth centuries, testifying to the continuity of these people living in those lands. They fight with a desperate courage, which has enabled them to withstand the mighty onslaught of massive Azeri ground and air attacks. They will not surrender lightly.
Therefore, perhaps I may finish with a final plea to my noble friend. The suffering of the people of Karabakh is in some ways worse than that in former Yugoslavia. At least the world knows about Yugoslavia and the big organisations are there, trying to find a solution. Similar political initiatives must be sought to try to bring about an end to the conflict
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between the Armenians and the Azeris; for there is a real danger that it could escalate into a war extending beyond the Trans-Caucasus. When I met Russian Defence Minister Shaposhnikov earlier this year, he suggested that this conflict could even contain within itself the seeds of a third world war. In the past few weeks, Azerbaijan has threatened to use nuclear weapons against Armenia. Whether or not it has the capacity to do so, that kind of threat is hardly conducive to a peaceful and rational resolution to the crisis.
I appreciate the good news that the Government are giving humanitarian aid to the people of Karabakh and I know that they will appreciate it too. But I hope that my noble friend will also reassure us that the Government are undertaking comparable political initiatives to prevail upon all those concerned in this tragic conflict to achieve a peaceful solution as a matter of great urgency.
As Azerbaijan is demonstrably the primary aggressor, I hope that every effort will be made to require the Azeris to lift their blockades, to agree to an unconditional ceasefire and to allow independent witnesses to monitor human rights throughout the region. If such measures could be implemented, they would be the greatest contribution the Government could make to the alleviation of the sufferings of both the Armenian and the Azeri peoples. The Armenians have asked the international community for help. I hope that we shall not fail them.
4.40 p.m.
Lord Avebury: My Lords, the House can seldom have listened to a more moving appeal than that which we have just heard from the noble Baroness, Lady Cox. She has been actively involved in the plight of the people of Nagorno-Karabakh and Armenia and, as she told us, has been there numerous times this year. I have had the privilege of reading her reports. One admires her immense courage in placing herself in the front line of this desperate conflict when her anxiety is solely for the alleviation of the sufferings of the victims, whether they be Armenians or Azeris. It would be a great shame if the words that she has spoken today were not heard by a wider audience than your Lordships alone. I wish that the British people as a whole could understand the horrendous plight which the people of Armenia and Nagorno-Karabakh suffer. I wish they could see the images, which she has presented to your Lordships from her recent trips, of the suffering of small children, the elderly, and the women. There are, too, the deaths of so many in the villages that have been overrun by hostile action.
The noble Baroness spoke about the relentless bombardment to which the enclave of Nagorno-Karabakh has been subjected and the use of 500 kilogram bombs which can only be designed to kill and injure civilians. They have no particular military purpose. There has been the use of cluster bombs, again particularly designed to kill and injure civilians, and GRAD missiles, those horrible weapons which kill indiscriminately and damage people's properties so that they cannot live in them any more. And remember—we are talking about a territory where the

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temperature in the middle of winter is well below zero, minus 20 to minus 25 degrees centigrade. It is impossible to survive in the open.
The noble Baroness described how the Azeris have tried to blockade the territory of Nagorno-Karabakh completely so that only a trickle of humanitarian supplies gets through. On numerous occasions, it has been thanks to the noble Baroness and her colleagues, who passed through the lines and brought medicines and other equipment, with humanitarian relief, to the people of Nagorno-Karabakh regardless of their own safety.
Armenia is also blockaded and under intermittent attack all along the border with Azerbaijan and cannot therefore do a great deal to help its compatriots in Nagorno-Karabakh. I was talking to one observer who returned last week and who said that, if anything, the conditions in Yerevan, the capital of Armenia, are even worse than those in Stepanakert. That is graphically confirmed by the article of Hugh Pope in today's Independent which many of your Lordships will have seen. He quotes Mr Ter Petrosian, the President of Armenia, as warning that,
"most of the 3.5 million people were below the poverty line, that 40 per cent. were at risk and that without help [from the outside world] 30,000 would die".
That is a statement of fact, I believe, and not an exaggeration.
Hugh Pope also refers to the,
"92,500 refugees from the war in Nagorny Karabakh".
He adds that people are still homeless after the Leninakan earthquake. So the position is desperate.
At the moment, only a limited flow of humanitarian aid is coming in via Turkey from the EC, but that cannot be a secure route, bearing in mind that, as the noble Baroness pointed out, the Turks are unofficially helping the Azeris militarily. I read in the noble Baroness's report, as she reiterated today, that Armenian military commanders say that there are Turkish officers serving with the Azeri forces. That has not been denied by the Turkish authorities, who make the excuse that the officers retired early from their service in the armed forces of their own country.
I wish to ask the noble Baroness whether any representations have been made to the authorities in Turkey about the matter. Surely, it is contrary to international law for personnel from the armed forces of one country to go and fight in another. On occasions in the past legal action has been taken against mercenaries of this country who, for example, went to fight in the war in Mozambique. Surely, it is an offence against international law which cannot be palliated or excused by saying that those officers were retired prematurely.
The international community as a whole should take up the matter with Turkey and get the officers recalled. It means that the Turkish Government are not neutral: they are—whether or not overtly—on the side of the Azeris in this desperate conflict. It means that we cannot rely on the Turkish route for goods to enter Armenia, but at the same time we should be
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pressing the Turks to allow further supplies of EC humanitarian aid to get in through that route. It is the easiest way to Armenia.
There are also some goods entering Armenia via Georgia, but, again, the route is insecure because the Georgians have their own internal problems. The supplies that get through have to meet the needs not only of the inhabitants of Armenia but also of an estimated 313,000 people displaced from Azerbaijan, following the pogroms of Sumgait and Baku in 1988, and the people who have fled from the conflict since then.
For the time being, Armenia and Nagorno-Karabakh have been able to repel the Azeri attacks and, as the noble Baroness described, to maintain the Latchin corridor which joins them. But for how long will that survive? I believe that Nagorno-Karabakh is militarily impossible to defend against a well-armed enemy with a much larger population surrounding it on all sides. The noble Baroness gave the figures of the relative populations.
The former Soviet forces on Azeri soil, who might have been a restraining force, finally left at the end of September, bequeathing their base facilities, some heavy weapons and probably many of their troops to the Azeri armed forces. According to the Georgian newspaper Gurandi, an agreement was signed on 25th May 1992 assigning equal shares of the former Soviet military equipment in the region to the three Trans-Caucasus republics. That would have given each of them 100 fighter bombers, 50 assault helicopters, 220 tanks, 220 armoured vehicles and 285 artillery pieces. But Georgia and Armenia received less than half that allocation, while Azerbaijan received the lion's share, including the 53 fearsome GRAD missile launchers which the noble Baroness mentioned.
How many troops the Azeris also incorporated into their armed forces is not known exactly, but the soldiers may have had some incentive to remain in a secure job rather than to go back home and join the dole queues. The Karabakh Minister of Defence, General Sarkissian, said recently that the Azeris have received additional massive deliveries of arms from Russia, including 130 SU24 fighter bombers, T82 tanks and BMP3 light tanks, and that Russian personnel are said to be training the Azeris in the use of these weapons systems. I am not sure how that squares with the charitable remarks which the noble Baroness made about the Russian wish not to do anything which would exacerbate the conflict that forced the Azeris into trying to acquire weapons in this country.
I believe that it is generally true to say that Russia has not played a very constructive role in stopping the many conflicts which have arisen in the former Soviet Union, and not just the one under discussion, but in Moldova, Tajikistan, South Ossetia and Abkhazia. The Armenians invited Russia to send in peacekeeping forces, but the Commander in Chief of the CIS, Marshall Yevgeny Shaposhnikov, said scathingly that it was not their job to separate warring tribes. That is not very good as an indication of the Russian attitude to the conflict.

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The Russians of course still have a massive arsenal of weapons. They are interested in earning hard currency by selling those weapons to countries which do not immediately threaten Russia's interests. That trade is a dangerous, destabilising force in the world. I believe that the international community should take steps to halt the flow of arms which were bequeathed to the CIS by the Soviet Union. I ask the noble Baroness whether the Government will consider asking the United Nations to set up a fund to buy and then destroy arms belonging to the CIS which would otherwise be sold to countries engaged in military conflict or which are likely to be so engaged.
The CIS forces should themselves become involved in peace-keeping operations if and only if the UN Security Council authorises their intervention. If that rule were applied, as of course it is for all peace-keeping operations outside the former Soviet Union, then the aggression of Azerbaijan against Armenia and Nagorno-Karabakh would have to be more actively considered by the Security Council than it is now because it would no longer have the excuse that Moscow had some residual responsibility. I do not understand the theory of that in international law. I ask the noble Baroness to consider why Russia or the CIS have an apparent right to intervene or not in conflicts which occur in any of the former Soviet territories without reference to the Security Council.
The only other possible means of settling this problem might have been through the initiatives of the CSCE, which the noble Baroness has mentioned. Representatives of 10 CSCE states have been working to broker a ceasefire in the area in December, as they have done many times before. But, as in Bosnia, it is very much easier to get the parties to agree to an armistice than to persuade the aggressors to observe it. The rule of international law has broken down in the former Soviet Union and mere persuasion has not worked. The Azeris must believe that time is on their side and that by a combination of sustained military pressure and the blockade they will achieve a final solution to the problem of Nagorno-Karabakh, killing or driving out every one of the Armenian inhabitants. Why should they pay attention to the CSCE busybodies, as they no doubt see them, whose ceasefires can only delay the inevitable end of the process?
As with all other conflicts in the Soviet Union, it seems that the insistence that all the borders inherited from the communist era be left untouched will make a solution very difficult. Stalin's population engineering, to which the noble Baroness referred, made ethnic conflict inevitable once the heavy lid of Moscow's control was taken off the cauldron. The existence of an Armenian enclave in the middle of Azeri territory makes the inhabitants into hostages, who would always be dependent on the forbearance of neighbours who see them as dangerous enemies. But the immediate task is to end the military terrorism against the Armenian people so that negotiations can begin.
It has to be said here that Britain's policy on Armenia has not been either consistent or moral. We condemn the attacks by terrorists against innocent civilians elsewhere in the world, but we reward the
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Azeris, who engage in the killing of civilians on a far greater scale than any of the non-governmental terrorists, by sending the President of the Board of Trade to the seat of terrorism, where he says that he would like to do far more business with them. By that encouragement of aggression, which violates Chapter IV of the United Nations Charter, we are actively undermining the rule of international law and encouraging other armed predators to attack their neighbours.
The United Nations Secretary General's special representative, Mr Omar Halim, is reported to have been in Armenia and Azerbaijan at the end of November to see whether the UN has a possible role in ending the conflict. I ask the noble Baroness whether there is any report by Mr Halim and, if so, what he has suggested to the international community. According to Helsinki Watch in a report published quite recently, the United Nations has not so far proposed the deployment of peace-keeping forces to Nagorno-Karabakh for active involvement in negotiations. The United Nations' Secretary General, Boutros Boutros Ghali, has explained that the United Nations position on intervention in Nagorno-Karabakh is to encourage decentralisation in peace-keeping operations. We want to encourage the different regional organisations to play a role. In the case of the regional framework not being able to solve the dispute, then we could move it to the Security Council.
I suggest that we have already reached that position. In fact, we have gone beyond it and now is the time for the United Nations to take a hand in solving this conflict. If we fail to do that the consequences are dire. We might have to apply to the people of Nagorno-Karabakh the epitaph which was pronounced on the inhabitants of Turkish Armenia, in the words of W.H. Auden quoted by Christopher Walker in his book Armenia:
"The mass and majesty of this world, all
That carries weight and always weighs the same,
Lay in the hands of others; they were small
And could not hope for help and no help came".
4.57 p.m.
The Lord Bishop of Guildford: My Lords, I cannot pretend to the personal knowledge and first hand experience of Armenia and Nagorno-Karabakh which the noble Baroness has acquired through her vision, courage and determination which we all so greatly admire. I am sure that there are many, not only in this House, who would like to place on record how much we profoundly respect and admire the courage which she has shown in her daring visits to that troubled country.
I dare to speak not from personal knowledge but because the House may like to know of a recent visit to Armenia and Azerbaijan by a delegation from the World Council of Churches. That body has on occasions had a reputation for supporting turbulence. Whatever the truth of that, on this occasion the delegation from the World Council of Churches was searching for reconciliation. The delegation returned to Geneva only last week and it seems right therefore

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that, as we give further consideration to Nagorno-Karabakh, we should have in mind what that delegation was able to report.
First, perhaps I may make a point of clarification and underline a point which the noble Baroness, Lady Cox, made; namely, that this is not primarily a religious conflict. It is more accurate to see it as a racial and cultural clash with religious overtones. As one of the World Council of Churches delegation put it:
"This is not a religious war, but it does have religious dimensions, and if the conflict is not resolved soon, religions could be misused and play a decisive negative role".
Azerbaijan can be unfairly linked with pan-Islamic fundamentalism but I believe that it would be more accurate to say that, following Soviet persecution of all religions, Azerbaijan has become a secularised society. Nonetheless, there is near the surface the lurking force of religious conviction which could very easily be exploited.
Secondly, there is a sign of hope. The World Council of Churches delegation met Sheikh-ul-Islam, Pascha-Zadeh, of Baku in Azerbaijan, the leader of the Trans-Caucasian Moslems, and CatholicosPatriarch Vasken I, of Etchmiadzin in Armenia, the head of the Armenian Apostolic Church. Both religious leaders received the World Council of Churches delegation with courtesy and respect, and both leaders agreed to meet together under WCC auspices and in collaboration with the Conference of European Churches. So, both Moslem and Christian leaders want to reach out across the abyss of blood, tears and hunger in the hope of bringing separated communities together.
"If a solution is to be found to this conflict",
the World Council of Churches delegation has said,
"authentic voices from Azerbaijan and Armenia must be heard by the international community."
The willingness of the leaders of Islam and Christianity in the area to meet is a sign that all is not lost in the flood of hatred and warfare: a glimmer of hope shines in the gloom.
Thirdly, I want to make a plea. There is no doubt about the suffering. That has been graphically and poignantly portrayed to us by the noble Baroness. There is suffering on both sides of this fruitless, destructive conflict—and there are wounded, homeless, hungry and terrified in both nations. The United Nations estimates that there are 216,000 refugees on the Azerbaijani side and only marginally fewer on the Armenian side.
The humanitarian aid from Britain of £0.25 million for Nagorno-Karabakh, with the further £200,000 just announced, is an undoubted help. But is it possible for the Government —here I underline what has been said by the noble Lord, Lord Avebury—to press for UN observers and monitoring—and even for armed forces to ensure that the aid reaches those who need it most? United Nations observers would ensure we had reliable facts about the situation. They might encourage more responsible and considerate behaviour for the defenceless victims of this appalling conflict. We are beginning to learn from Bosnia and Somalia that humanitarian aid often has to be
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"forced" through. I recognise that it is easy to make the plea and far from easy to deliver what is requested; nonetheless, the plea must be that the United Nations should be urged to take much greater and more effective action in this area of conflict.
Finally, a reflexion: in Nagorno-Karabakh—as in Bosnia —we see a conflict undergirded by religious differences. If we do not with determination ensure that these conflicts are resolved, we leave it open to unscrupulous people to exploit the differences between Christianity and Islam and so expose ourselves to finding tension between these two cultures and faiths opening up in places where at present there is mutual understanding and toleration. How the international community handles the conflict in Nagorno-Karabakh may have repercussions in many parts of the world far removed from the Caucasus. It is for such reasons that I am deeply indebted to the noble Baroness, Lady Cox, for her persistent and courageous work not only in her visits to that part of the world, but in always ensuring that this matter is kept before your Lordships' House.
5.4 p.m.
Baroness Park of Monmouth: My Lords, like many others, I should like to thank my noble friend Lady Cox for bringing the long-drawn-out suffering of the people of Nagorno-Karabakh and the evil acts of the Azeris to the attention of your Lordships' House, as she has already done in the United Nations and in the Conference for Security and Co-operation in Europe after her courageous journeys to that troubled area. She has not told us that her head is forfeit in Baku. Like her, I hope to hear from my noble friend the Minister what is Her Majesty's Government's policy on the situation there, but we have to recognise that under the present rules of international conduct we have no standing to intervene as peace-makers on the ground, even if we had the resources to do so. The only country which has that status is Russia—or rather the states of the Commonwealth of Independent States, but they too have problems.
The first of these is that Russia is already committed to using its forces for peace-making in the North Osetia-Ingush conflict, the war between Abkhazia and Georgia and the serious conflict that is going on within Tajikistan, where many Russians are at risk and the Afghans are contributing to the unrest on the border. Russia has had to receive 470,000 refugees from internal civil wars in the CIS states and 800,000 forced migrants, most of whom came from Azerbaijan, Abkhazia, the Baltic States and Moldova. Another 2 million are expected by next year, and there will still be 24 million Russians according to Russian estimates living outside Russia itself in the CIS states. Nagorno-Karabakh, where the Russians were originally involved, is only one of many such trouble spots. It has to be said also that the CIS military command wishes for no commitment in Nagorno-Karabakh.
The next difficulty is that Russia evidently welcomes the deepening involvement, both political and economic, of Turkey in the former Central Asian republics, both as a moderate counterbalance to Iran and no doubt because Russia is selling Turkey

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helicopters, armoured personnel carriers and other defence equipment. The Bosphorus Declaration was followed at the end of November by the accession of Azerbaijan, with four other Central Asian republics, to the Economic Co-operation Organisation (ECO) which was formed in 1964 by Turkey, Iran and Pakistan. One of its objects is to strengthen multilateral ties between countries sharing the Islamic faith, but it will also enable them to replace India as one of the strongest former trade partners with Central Asia. Moscow will not feel too happy about this but will probably hope to see Turkey act as a stabilising factor.
Earlier this month the Russians and the Turks met to discuss foreign and economic affairs, and the Russian Deputy Foreign Minster, interviewed beforehand, said:
"We are concerned about the Armenian-Azerbaijani conflict, where Turkey can have its own peacemaking say, and we are ready to co-operate with Turkey in settling conflict situations in ways that meet Russia's interests".
Turkey is evidently, indeed, willing to mediate, but it seems only too probable that Armenian doubts about Turkey's even-handedness may be justified. The Turkish Embassy in Baku stated in early December that Turkey was prepared to offer aid to Armenia provided that it ceased fire and withdrew its forces from Azerbaijan—that is, from Nagorno-Karabakh. The spokesman went on to say that as for emergency humanitarian aid, Turkey will give the United Nations an opportunity to deliver food and essentials to Armenia during the winter months, while other Turkish direct aid would depend on the cessation of combat operations in Azerbaijan by Armenia.
That statement followed a "summit" in Ankara at the end of October of the five Central Asian republics, at which Azerbaijan stayed behind afterwards. At that meeting President Nazarbayev of Kazakhstan said that the CIS countries, with President Yeltsin, were trying to solve the problem of Nagorno-Karabakh. "We are", he said,
"pursuing a policy within the framework of the United Nations and the CSCE. Third parties should not interfere in the problem. There is no need for the Turkish republics to unite to support one of the sides. We believe a dialogue between Azerbaijan and Armenia will be beneficial".
Turkey and Azerbaijan took no notice.
It must be clear that, first, Azerbaijan has powerful friends (and even Russia has recently granted it some industrial credits), and, given its oil, it can expect investment from the West as well as from ECO. Texaco is looking at the onshore oilfields and may help the Azerbaijani oil industry, which is in trouble. BP is also active.
Secondly, Russia and the CIS countries do not intend at present, despite the fact that Armenia is a loyal member of the CIS and Azerbaijan is not, to intervene in a peacemaking role, despite a final, formal appeal from Armenia. Armenia (let alone Nagorno-Karabakh) is geographically isolated and now, fearing a cut in its own gas supplies from Baku, Georgia is reported to be bowing to the demands of the Azerbaijani authorities and sharply reducing the supply of Turkeman gas, which is normally routed to Armenia through Georgia. The only contiguous
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countries, Iran and Turkey, will help Armenia only on terms which are unacceptable, if indeed they intend to help at all.
Meanwhile, Armenia will come to a standstill industrially. There is no heat, bread is rationed and Azerbaijan, not content with the use of GRAD missiles and military aircraft, with the blocking of all humanitarian aid and the threatening of nuclear attack, is spending, as indeed Armenia is obliged to do, 70 per cent. of its budget on arms to pursue the fight.
What can be done to help, not only the brave people of Nagorno-Karabakh, but Armenia itself, an ancient Christian country, to survive? The UN Secretary General sent a representative there. A UN representative went also to Tajikistan and much humanitarian aid followed. Has it gone too to Armenia, and not via Baku? The European Bank of Reconstruction and Development is, I believe, considering help to Armenia. That should be encouraged. The EBRD has refused credits to Azerbaijan and I believe also to Armenia. The latter decision should be reconsidered.
Until yesterday I would have advocated bringing pressure to bear simultaneously on Turkey to use real pressure on Azerbaijan for an immediate and permanent ceasefire without conditions and on President Yeltsin to provide a CIS peace-keeping force to enforce the truce and report to the UN. But Yeltsin has much to do just now, perhaps even to survive, and I share the belief of the noble Lord, Lord Avebury, that the pressure should be on Turkey.
On 8th December in Baku the Turkish Deputy Prime Minister, Mr. Inonu, said that,
"unless Armenia resolves the Nagorno-Karabakh problem peacefully, Turkey will not develop its relations with that country".
He stressed that Nagorno-Karabakh is and will remain Azerbaijani territory. He said that the bloody conflict could be resolved in the form of Armenia withdrawing her troops from Azerbaijani territory. He went on to say:
"This is of vital importance for the establishment of stability in the sensitive Caucasus region";
and added:
"Yerevan must realise that all wars are solved at the negotiating stage".
That is surely an ironic statement. Azerbaijan had a priority position in Turkish foreign policy. Turkey would give no electrical energy and no aid to Armenia while that country attacked Azerbaijan. There would be no political relations until Armenia reverted to a peaceful attitude, peacefully resolving the problem of Nagorno-Karabakh. She would do nothing to harm Azerbaijan's interests.
In the light of such an unequivocal commitment to Azerbaijan on Turkey's part, it might seem hopeless to seek Turkey's help. However, we must surely have cards in our NATO hand to play. We should play them strongly as well as demonstrate to the UN that we passionately believe that the world should be acting now to exert whatever pressure it can to save Nagorno-Karabakh and Armenia. I hope that my

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noble friend the Minister will tell us what the United Nations Secretary General is doing in the light of his representative's report and what that report was.
5.13 p.m.
The Earl of Shannon: My Lords, I cannot speak with the authority of the noble Baroness who is asking this Question because, as you have heard, she has made many visits to the most dangerous areas of the Karabakh bringing humanitarian aid, and has rightly earned the undying gratitude of all the people of Armenia and the admiration and respect of us all. As the House has heard, I am the chairman of the British Armenian All-Party Group. Although I have never visited Armenia, I hope to do so shortly.
Perhaps we may consider for a moment what and where is Armenia. It is a very ancient kingdom which at one time stretched almost from the shores of the Mediterranean to the Caspian. Over the many centuries it has been reduced in size by its rapacious neighbours, by deportation and by the massacre of its inhabitants. It suffered from the callous misrule of the Persian, Roman and Ottoman empires, the last being quite the worst when in 1915 the Turks "ethnically cleansed" the eastern part of Armenia, which was known as Turkish Armenia, by slaughtering the inhabitants, leaving little or no trace beyond a few ruined churches and monasteries of what was once a thriving community. These churches are now officially declared "earthquake damaged" in a peculiar and somewhat selective manner because the walls always seem to fall outwards, similar to the use of explosives, and neighbouring mosques are totally undamaged.
Now all that is left of that ancient and cultured country is what was known as Soviet Armenia, some 29,000 square kilometres—about the size of Albania —with a population of around 3 million. It is bordered by Turkey, Georgia and Azerbaijan, with a small frontier in the south with Iran. The Turkish genocide of 1915 killed some one and a half million Armenians and after the First World War there was a short lived independent republic of Armenia from 1918 to 1920, when it was swallowed up into the Soviet Union rather than submit to Turkey. The western part, the Karabakh, was donated as a semiautonomous state to Azerbaijan, although it was 75 per cent. populated by Armenians. This was part of the ancient strategy of the Romans in keeping vassal states at loggerheads with each other so that they could not cause trouble to the central authority.
The Armenians have for centuries been noted for their culture and high level of civilisation and recently for their poets, musicians, scientists and mathematicians, many of whom are world class by any standards. They have maintained their culture, language, alphabet—with too many letters for our comprehension—art and traditions in the face of these centuries of adversity. Their Church, one of the oldest in Christendom, is still a central force among all Armenians, wherever scattered over the globe, as many now are, but still considering themselves Armenians.
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This is a thumbnail sketch which in no way does justice to an ancient civilisation and people dogged by misrule, invasion, imperial rivalry and deliberate massacre, which latter still continues.
Let us look at today's situation. Azerbaijan looks at the mountainous area of the Karabakh with its largely Armenian population and says, "This was given to us by Stalin, so out you get of our country". The Armenians retort, "This has always been our land, where we have lived since ancient times, and here we want to stay". Although the Armenians originally voted to become an independent republic of the Karabakh, they withdrew this and agreed to remain, as they were originally, a semi-autonomous state within Azerbaijan. Azerbaijan declared their previous semi-autonomy to be invalid and invaded the area in order to produce a military solution. Although, as the noble Lord, Lord Avebury, pointed out, a previous CIS directive had allocated a fair proportion of all the old Soviet military hardware between all the states, Armenia and Georgia have received only a small portion of their allocation, the bulk having been appropriated by Azerbaijan which used it against the Armenians in the Karabakh. How the Armenians there, armed mainly with sporting weapons and those captured from the invaders, have held out for so long is a miracle, but fighting for one's life, family and property gives one a greater spur than those whose only objects are pillage, murder and rape.
Azerbaijan has publicly offered ½ million US dollars for every hijacked SU-27 fighter delivered to it, and has twice threatened to use nuclear weapons against Armenia, not only the Karabakh but against Armenia proper. That statement was made by Azerbaijan interior Minister, Mr. Gamidov. It has since withdrawn that statement in the face of international horror, but then spread a story that Armenia was trying to build its own nuclear weapons from the remains of its closed-down reactors of Russian design and doubtful safety.
Not a day goes by without reports of the shelling of civilian targets in Karabakh and Armenia by Azerbaijan, so much so that the Armenians in Karabakh are now designated by Médecins sans Frontières as a people now threatened with extinction at the hands of Azerbaijan. That is not a very nice situation.
Of course, the Armenians have taken such small retaliatory action as they are able to neutralise artillery and rocket sites which are shelling them and to open a humanitarian corridor in the short distance which separates Armenia from the Karabakh in the Lachin area. That was done to break the blockade which is strangling them. Your Lordships would do exactly the same in the position in which they are placed.
So what price the high political rubbish preached by Western politicians—or some Western politicians —that the Armenians must learn to make peace? All they can do is to give in, be slaughtered and let the Azeris walk all over them. Is that the solution advocated for the Bosnians as well? It is no use pleading the Helsinki agreement either. It is the

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Armenians who want to keep the status quo, not Azerbaijan which seeks a military solution by invasion.
I have mentioned the blockade, and that applies to Armenia proper as well. For years that landlocked country has been under blockade by its neighbours. Extortionate demands are made by those neighbours to allow relief supplies to pass through their territory, or else passage is refused arbitrarily. Much humanitarian aid provided internationally just "disappears" in neighbouring countries.
Armenia, with the approach of a severe winter, is in a desperate situation. It is almost totally blockaded in both food and energy which are rapidly becoming almost non-existent. Energy receipts are now some 10 per cent. of previous consumption. Let us imagine what would happen in this country if our energy was cut by 10 per cent. There would be riots. They have 90 per cent. less energy. That lack of energy means that industry in Armenia is at a standstill. People are starting to die of cold and starvation—the classic way of conducting a siege to make the defenders give in.
Turkey did agree to supply some electricity but has recently reneged on that contract under pressure from Azerbaijan. Turkey may have originally agreed because there is an Armenian reactor near its border, and it was frightened that, in desperation, the Armenians might recommission that reactor with its possible nuclear peril rather than suffer certain death from hypothermia. Azerbaijan has also issued an ultimatum to Georgia, itself in turmoil, not to permit fuel supplies to be transported to Armenia through that republic.
We may ask: why are we discussing this subject? What interest does it hold for us? There is no oil in Armenia, but there is in Baku. We are therefore, as has been said, aiming to trade with the aggressors. What price now the Western nations' high moral stand over Kuwait—one member of the United Nations must not invade another nation—or was it really, "Get your dirty hands off our oil"? There has also been an information blockade. One can understand that the media are there to sell their programmes or their newspapers. What interest can there be for them? People have been to the old Yugoslavia on package holidays, but how many people have been on package holidays to Armenia? It is not a very interesting subject. What do we want? What is wanted now is freedom from blockade. That is clearly against international law. We want respect for the Helsinki agreement and existing boundaries. The Azerbaijanis should not try to alter them by military solutions. Respect for that agreement and its boundaries and a semi-autonomous state for Karabakh is what the Armenians want.
There is surely a lack of information coming out of Armenia. What is needed, as has been said, is United Nations observers to report accurately on the situation. The world should not be left with a dearth of information and the highly subjective press releases issued in Baku.
Within the past half an hour I have received a sheaf of faxes from Yerevan giving the latest information. Unfortunately it was too late for me to include it in my
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speech. However there is one paper at the back which is a fax that has come direct from Yerevan. Perhaps I might have your Lordships' leave to put it on the record. It reads as follows:
"I, the President of Armenia, Levon Ter-Petrossian, on behalf of the people of Armenia, declare the Republic of Armenia in a state of national disaster. Due to the devastating effects the Azeri blockade has had on the country, creating a severe energy crisis, the government appeals to all nations of the world, all international humanitarian organisations and government agencies to provide assistance to the people of Armenia for the next 12 months in order to secure the survival of the people through the harsh winter months.
According to the UNHCR assessment survey of October 14, 1992, the economic collapse of Armenia is attributed to the 'blockade of Armenia [which] has been de facto in force from Azerbaijan/Nakhiohevan, Turkey (according to the inter-governmental agreement, Turkey is supply only grain via its rail road) and, lately, Georgia. Should attempts aimed at opening one or two relief corridors through Turkey, and, if possible, Georgia, fail, we are convinced that a catastrophe will take place this winter'. Other assessments by UN teams, the United States, the International Federation of Red Cross, the American Red Cross, the International Council of Voluntary Agencies corroborate these findings.
The Government and people of Armenia urgently require sustained, effective humanitarian assistance in order to prevent deaths in the tens of thousands from exposure, hunger and inadequate medical attention.
Unless immediate action is taken to transport fuel, grain, food items and winterisation items as well as medical supplies into the Republic, the dismal projections made by various assessment teams will become a reality. Thus, on behalf of the people of Armenia, I, the President of the country urge all governments and humanitarian agencies to respond immediately by putting pressure on different nations to allow the transportation of fuel and aid into the country".
It bears the signature of Levon Ter-Petrossian, President of the Republic of Armenia. That letter is addressed to the Right Honourable John Major, Prime Minister of the United Kingdom of Great Britain and Northern Ireland, 10 Downing Street, London.
5.30 p.m.
Lord Pearson of Rannoch: My Lords, like other noble Lords, I find it difficult to make a worthwhile contribution to the debate on the tragic situation in Nagorno-Karabakh and Armenia when one is following my noble friend Lady Cox, who has spoken with the authority and compassion which only she can bring to bear on the subject. Furthermore, others have spoken and are to speak who know far more than I about the wider geo-political dangers which flow from the escalation of hostilities in the Trans-Caucasus.
But I believe that I am the only Member of your Lordships' House to have been with my noble friend to the area, even though it was in much less dangerous times in July 1991. I met the leaders of Azerbaijan and Armenia and I went by helicopter to both Armenian and Azeri villages in Nagorno-Karabakh and spoke to their leaders. President Gorbachev was in London at the time asking for western aid at the G7 talks in order to save his regime, and so our delegation was given unprecedented access to the region.
I hope that that experience allows me to confirm that the Azerbaijanis started off the more brutal phase of their present aggression with vastly superior forces. At the time of our visit they were supported by the Soviet Fourth Army, and by every branch of the Soviet special forces, in their policy of clearing

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Armenian villages in Nagorno-Karabakh of the Armenians who had been living there for centuries and replacing them with Azerbaijanis.
In the simple peasant villages I found a shared dismay on both sides of the conflict as to how the hostilities had started. An Azerbaijani village leader told me that he could not understand what had happened. Only two years before he and the leader of the nearby Armenian village had been such good friends that they had both been to each other's daughters' weddings. He could not understand why his friends had started shooting at his village; it simply did not make sense. On the other hand, the Armenian village leader was equally nonplussed; but of course he believed that his Azerbaijani friends had started the shooting.
Those simple village folk did not seem to appreciate that Armenia had in the meantime committed the crime of wishing to secede from the Soviet Union whereas Azerbaijan had remained loyal to Gorbachev. Nor, I imagine, did they appreciate the importance of Azerbaijan's oil to the Kremlin. It seems at least possible therefore that the Soviet special forces were influential in starting the present conflict and that the Kremlin then threw the weight of its Fourth Army behind Azerbaijan. That view is shared by a number of Soviet experts who know better than I how Spetznaz and other special troops used to be deployed.
Be that as it may, in July 1991 there was no hint of embarrassment from either Mr. Mutalibov, then President of Azerbaijan, or from Mr. Victor Polianitchku, his henchman who had perfected Soviet village clearance tactics in Afghanistan, that the Soviet Union was on their side against the wretched Armenian villages of Nagorno-Karabakh. Furthermore, when my noble friend Lady Cox and I were received in Moscow on our way back to London by Chairman Lukianov, who was acting head of the Soviet Union while Mr. Gorbachev was in London, he did not make any attempt to deny our view of Soviet involvement either. In fact, he was interested only in one thing; he was very anxious that what was happening in Nagorno-Karabakh should not be "internationalised". By that he meant that it should not be put on the international political agenda. I am sure all noble Lords will agree that my noble friend Lady Cox has defeated him in that object.
I hope your Lordships will not consider that that account of why and how the present conflict may have started is irrelevant to the problem today. Of course, the Soviet Union has disintegrated; but when it did, Azerbaijan took control of the arms left behind by the Fourth Army and other troops. Therefore, I am sure it is true that the Azeris, with a population of some 7 million, are now infinitely better armed than the 100,000 Armenians who are left in Karabakh and against whom they continued to wage war.
In a way it is hard to see why the conflict continues. The Armenians certainly want peace. All they want is to be allowed to live normally in their ancient homelands. I understand that they have said they will be happy to see the 20,000 or so Azeris, who have now
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left Nagorno-Karabakh and who are refugees in Azerbaijan, return to their villages and pick up the pieces of their broken livelihoods. Of course, any such initiative would require massive confidence-building measures from the international community and one wonders whether it has the stomach for that.
So why does Azerbaijan continue the conflict? Obviously, it wants back the villages and land in Nagorno-Karabakh for its refugees who are now living very uncomfortably around Baku, Agdam and elsewhere. To an unbiased observer it must also occur that Azerbaijan may have continued its aggression against the Armenians of Karabakh after the Soviet Union broke up partly for the well-known motive of drawing its people's attention away from problems at home. Then of course once the killing starts it is very hard to stop a conflict until one side wins. Azerbaijan is determined to remove every Armenian from Nagorno-Karabakh; the Armenians are prepared to die to defend their homelands, and so the killing goes on.
It is important to emphasise, as my noble friend Lady Cox mentioned and as the right reverend Prelate the Bishop of Guildford said, that we are not looking at a religious war as such, even though the Azerbaijanis happen to be Moslems and the Armenians Christians. We are looking at a conflict which may have its roots in former Soviet strategy and interests, encouraged now by the factors that I have mentioned and no doubt by others. But if Nagorno-Karabakh were to fall to Azerbaijan, and if the conflict were to escalate to involve Armenia itself and perhaps Russia and Turkey, I suppose that the religious dimension would become very much more worrying indeed. Other noble Lords have commented on that issue and so I shall say no more about it now.
That brings me back to the role of the international community. Is it acceptable that small, private charitable organisations, such as those patronised by my noble friend Lady Cox, are the only ones to provide a lifeline of medical supplies and food to a people suffering what is now often referred to in the Yugoslavian context as "ethnic cleansing"? Is ethnic cleansing not much the same thing as genocide? Does not the word "holocaust" begin to lurk in the back of our minds?
In the wake of the break-up of the Soviet empire a huge question now poses itself, and it is this: to what extent are the civilised nations of the world prepared to tolerate these evils without committing their own troops to alleviate the suffering in question? The answer is not yet clear and I certainly do not pretend to be able to start to provide the answer.
But we now have the recent landmark decision of the United Nations to sanction military action in Somalia. International opinion seems to be moving towards more rather than less military involvement to relieve massive human suffering which does not affect our strategic interests directly. Of course, the UN decision would be of little avail if the United States in particular did not have the military capability actually to put enough men on the ground in the time required. I should go further and say somewhat in parenthesis that in what may be the changing climate of public

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opinion one begins to wonder whether the Government's decision to cut especially our Army, under their policy known as Options for Change, may not turn out to be even more misguided than most of us believed it to be in the first place. Our commitment of troops to Bosnia seems to underline that fear. But I am afraid I do not expect that my noble friend on the Front Bench will be allowed to agree with me.
Be that as it may, is my noble friend the Minister absolutely confident that our Government are at least putting all the diplomatic and commercial pressure that they possibly can on Azerbaijan to cease hostilities in Nagorno-Karabakh? Could we not, for example, join with our allies to insist that free passage be given by Azerbaijan to international observers and to the major relief agencies? If that could be achieved, it would prevent this tragic and dangerous conflict from continuing to be forgotten by the world at large, and it might therefore contain the seeds of eventual peace.
Can I end by joining others of your Lordships in paying tribute to the remarkable courage, determination and skill shown by my noble friend Lady Cox in all this? I am afraid there are a few people—although I trust there is none in your Lordships' House—who feel that my noble friend has mounted a crusade to help the Armenians of Nagorno-Karabakh; that somehow she is not entirely balanced in her support for them. The Azeris and their friends go further of course and accuse my noble friend of pro-Christian bias. Well, we must not fall for this obvious propaganda. I am sorry to say that I am not a particularly good Christian myself. Indeed I have many good Moslem friends; and I have even pleaded in your Lordships' House that Moslem schools in this country should be allowed to opt into our state system of education. So I hope your Lordships will accept my assurance that my noble friend's version of events in Nagorno-Karabakh is entirely objective and unbiased. I believe it is true to say that without the huge personal effort made by my noble friend, first Chairman Lukianov and then his Azerbaijani friends might have succeeded in burying their genocide of the Armenians of Karabakh from international view.
I can assure your Lordships that my noble friend's missions are no crusades, and they are no picnics either. Towards the end of the mission upon which I was privileged to accompany her, the delegation told her lightheartedly that it was thinking of going on strike if its members could not be guaranteed at least three and a half hours sleep each night. Compromise was reached on a formula which guaranteed us not more than four hours sleep in future. On her later missions, she has been in much physical danger. Her jeep has been under sustained anti-tank gun fire, with one rocket lifting its back off the ground. If that rocket had pitched three feet further forward, she would not be with us now. One of the lorries carrying her medical supplies over the newly opened land route from Armenia into Karabakh was mined, killing the drivers. The aircraft in which she has been travelling have avoided heat seeking missiles thanks only to the skill of their Armenian pilots.
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These are the sort of dangers she has faced to bring us this debate today. When the Armenian Orthodox Christmas comes on what is our Epiphany, 6th January, it will find my noble friend Lady Cox in Stepanakert, probably in a cellar underground, sheltering with her local civilian friends from Azerbaijani bombardment.
So I very much hope that my noble friend the Minister can reassure us as to what more the Government may feel they can do to make that prospect less likely.
5.42 p.m.
Viscount Ingleby: My Lords, I, too, share the deep concern that has been expressed by the noble Baroness, Lady Cox, and others in this debate. I wish to quote from a letter from the Bishop of Nagorno-Karabakh—his correct title is the Bishop of Artsakh—written on 5th January 1992. The letter was addressed to the hierarchs of all churches, the UN Secretary General, the heads of all states, all charitable organisations and societies and all people of good will. I wish to quote briefly from the letter:
"Artillery shelling has destroyed hundreds of homes in [the capital] Stepanakert [including the residence of the Diocese of Artsakh (28 December 1991, 7.05 am)]. It is only thanks to the mercy of God that I was saved".
The Bishop got out of bed to pray when his house suffered a direct hit and a concrete block landed where he would have been on his bed. He continues:
"It is not only the perpetrators of crime and evil who commit sin, but also those who stand by—seeing and knowing —and who do not condemn it or try to avert it".
Why is the United Nations not acting? If it intervenes to help the Moslems in Bosnia, why does it not intervene to help the Armenians in Nagorno-Karabakh? Why is there not a trade embargo? I must ask the Government whether we are still supplying arms and aid to the Azerbaijanis. Is there not a ban on that? Surely those supplies should stop until the Azerbaijanis stop the fighting? Can we not follow the American lead in this matter? Finally, are we in touch with Mr. Shevardnadze and Mr. James Baker, who I have reason to believe would be very sympathetic to the Armenians' plight?
5.45 p.m.
Viscount Brentford: My Lords, I, too, wish to thank my noble friend Lady Cox for introducing this debate not only because it gives publicity to the needs of Armenia and Nagorno-Karabakh but also because it enables us to discuss whether additional national and international help on both the humanitarian and political scene can be given.
First, I wish to make a couple of preliminary points. We are dealing here with a question of human rights. My noble friend Lady Cox has clearly demonstrated the way the Azeris beat up, maltreat, rape and massacre the Armenians in Nagorno-Karabakh. We are dealing with a severe case of human rights abuse which requires the world's attention.
We are all well aware that the press is not in the area and therefore it is not possible to see pictures on the television or in newspapers. Therefore no one pays attention to the situation. This is a matter that your

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Lordships' House can address. Noble Lords can publicise the situation and encourage action to be taken to mitigate the human rights abuses. A great deal is said and written about human rights today, and this is one instance which requires the world's attention.
My second point has already been made by several speakers. It concerns the religious issue. Last week we discussed the Sudan, where Christians are being severely persecuted. As we know, over 100 have been crucified. The problem we are discussing is primarily an ethnic one and one of cultural background. I wish to echo what has been said. We do not want to see religious differences being exploited. I believe that the Devil exists and that he is keen to exploit religious differences as that dishonours religion. We need to recognise that problem and help all those who are suffering from persecution. We need to treat them even-handedly.
I believe that there are four different spheres in which action can be taken to relieve the situation in Armenia and Nagorno-Karabakh. First, my noble friend the Minister has been asked about the Security Council. As the noble Lord, Lord Avebury, asked, is this not the time to raise the matter in the Security Council? What is the result of the representatives' report? It could be important if it provides any signposts to the way ahead. I hope that my noble friend will say what the action of the Security Council should be.
Secondly, I refer to the Council of Europe. As we have heard, Turkey is lending help, and indeed is lending 40 prematurely retired army officers to the Azeri troops. Turkey is applying for membership of the Council of Europe. Therefore it seems to me that the Government have leverage to bring to bear on Turkey. The Turks' action in supporting the Azeris is not commensurate with a nation that is applying for membership of the Council of Europe. I hope that the Government will bring pressure to bear on the Turkish Government, both individually and through the Council of Europe, to desist from their support for the Azeris.
Thirdly, the Conference on Security and Cooperation in Europe has already been referred to. I understand that only last week my right honourable friend Mr. Garel-Jones spoke about this question of Nagorno-Karabakh and the CSCE. He said that the Government are not approving licences for the export to Azerbaijan of military equipment or anything that could be used for military purposes and that we supported the CSCE resolution on the supply of weapons to the dispute. He also said that we are pressing for a widening of the embargo to cover all military assistance. Can my noble friend tell us what action has been taken since then to arrange for the embargo to cover all military assistance?
Finally, I hope that the Government themselves will bring pressure to bear and use their great experience and initiative to ensure stronger mediation, through Europe or through the UN, even, if necessary, including the use of peace-keeping troops in that area. It does not appear to be an issue which
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Russia will handle. Therefore, as the noble Lord, Lord Avebury, said, this should now perhaps be a matter for the Security Council.
I very much hope that we shall not sit idly on the sidelines but will take action to try to ease the appalling suffering and stop the murder which is taking place in that region.
5.52 p.m.
Lord Archer of Sandwell: My Lords, not for the first time the House will be grateful to the noble Baroness, Lady Cox, for affording us an opportunity to debate this unhappy situation. Her concern for the area and its people, her courage in visiting Azerbaijan and Armenia more than once and going to the areas of devastation and suffering, her conversations with the victims of violence and starvation among people of both cultural traditions and her representations on their behalf to all the authorities concerned will one day, I hope, deserve a place in the history books. Certainly she brings to the debate a knowledge which I cannot hope to equal.
The debate comes at a time, as a number of your Lordships have observed, when it is difficult even to obtain up-to-date information about the situation and yet when it is so vitally important that we should contribute, if we can, to a solution of the many problems which press upon the people of the area. As the noble Baroness and the right reverend Prelate reminded us, I understand that this is not primarily a religious conflict but certainly it is a tribal conflict arising from the history of the interaction between two faiths. It is an area destined by history to be a meeting ground of two of the great monotheistic faiths. One of the ironies of history is that those faiths enjoin on their followers the virtues of peace, yet the very fact of their interface, at least since the 16th century, has denied its people any prospect of a lasting peace.
It is even more ironical that the tragedy should emanate only partly from external factors. It is one of those areas of the world where two peoples suffer a repressed sense of nationhood which has seared into their souls two rival tribalisms; so each generation has passed on to the next a consciousness of past insults and a commitment to continue the feud; so each successive generation bequeaths to the next the heritage which it has received together with its own contribution of wrongs waiting to be avenged. Of course it is true, as the noble Lord, Lord Pearson, reminded us, that many people in adjoining villages, sometimes even in the same village, have found it possible to live together in friendship. But when ill-intentioned people apply a match, I suspect that the tinder of in-built prejudice is very much present. We have witnessed such tragic cycles in many regions of the world, sometimes within these islands, but rarely with more tragic consequences.
Perhaps most ironical of all is that the new freedom which has emerged in the lands of the former Soviet Union, the new opportunity for people to choose their own destiny, has enabled them to pursue old quarrels with greater intransigence and to practise old cruelties with fewer inhibitions. So it was at the break-up of the Roman Empire and the subsequent succession of

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empires Imposed by force, especially when external authorities have reasons of their own for wishing to foment problems.
It is encouraging to learn from the right reverend Prelate that the leaders of the two faiths are seeking a reconciliation. We hope that something may emerge from that.
Perhaps there are two lessons that we can learn before we begin to consider the details of this tragic conflict. The first is that, if there is to be any break in the cycle of wrong, retribution and revenge for the retribution, it is that someone must address the teaching of history in the schools in the hope that there will come a generation which will try to understand and forgive and break the deadly circle.
The second lesson—which I mention with a due sense of the feeling which your Lordships have for the people in the area who are afflicted—is that we should be wary not to say or do more than is necessary, which could inflame the sense of bitterness and frustration on either side. If we cannot close the breach we should be reluctant to take any steps which could widen it. If we cannot heal the wounds we should be careful not to infect them further. Of course I appreciate the concern of many of your Lordships that, where there is an imbalance in responsibility for the situation, it may sometimes be necessary to say so in the most forthright of terms, but that may not always be the way in which we can best help the people of Karabakh. It is very much a matter of judgment for those who are closest to the attempts which are being made to resolve the situation.
The whole House will applaud the efforts of the Rome group, to which the noble Lord, Lord Avebury, referred, to bring about if not a reconciliation at least a ceasefire within the framework of the CSCE. It was a tragic disappointment that the efforts of the advance monitoring group to arrange the peace talks collapsed in September in the face of what must be said to be the intransigence on the Azeri side. As the noble Baroness, Lady Cox, reminded us, they believe, with justification, that might is on their side and that there are no specific pressures to bring them to the conference table. I hope that when she replies the Minister can tell the House whether any progress has resulted from further efforts of the Rome group. Perhaps she can also tell us whether any other efforts are being made outside the CSCE process. That is a question which has been asked by so many of your Lordships.
We wonder whether the Commonwealth of Independent States has taken any initiative. I appreciate, as the noble Baroness, Lady Park, said, that they have other things on their minds. But if there have been any other initiatives, can the Minister tell us what has emerged from them? In relation to the position of Turkey, can NATO persuade Turkey to play a more constructive role? As the noble Viscount, Lord Brentford, reminded us, there is some leverage in the fact that Turkey has applied to join the Council of Europe. I hope that the noble Baroness can tell us what has arisen from that situation.
The House has been reminded by the noble Lord, Lord Avebury, that in September it was announced that Mr. Boutros Ghali was sending his special
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representative to the area, Mr. Omar Halim. I confess that I have not seen, although some noble Lords appear to have seen, reports that he arrived in the area. Certainly no one seems to have heard anything further. Did Mr. Halim report? Did he have talks with the authorities there? If so, with what result? Is it proposed to raise the results of his report in the Security Council? Again perhaps the noble Baroness can enlighten us on some of those matters.
Turning to the plight of the refugees from both cultural traditions, the latest figures seem to indicate that Armenia is coping with some 300,000 who have fled from Azerbaijan or from Karabakh at a time when that country, as the noble Baroness reminded us, is still suffering from the after-effects of the earthquake. Azerbaijan has received, we are told, more than 400,000 refugees, partly from Armenia but partly from other parts of Central Asia—a total of displaced persons approaching some three-quarters of a million. It is true that the deliberate blockading of Karabakh by Azerbaijan is creating some of the problems which afflict those unhappy people.
The announcement from the High Commissioner on 1st December was that an aircraft had been chartered to carry to the area two teams of relief specialists, each of five members, and that this marked the launch of an emergency operation amounting to some 6.37 million dollars. I wonder whether the noble Baroness can tell us anything further in the way of news about that. One aspect which certainly occasioned me some anxiety was that it was said that the operation would concentrate initially on 145,000 of the displaced persons. I understand the reasons for that and I make no criticism. They are bringing relief to those who face a harsh winter in public buildings which are most vulnerable to hardship, particularly when, as we have been reminded in this debate, there is no energy for heating.
But what of the other refugees? Is it known whether and when they can expect help? Perhaps when she replies the noble Baroness can tell us what is the news in respect of that mission and possibly give us some idea of the contribution to the operation made by the EC and by the British Government. I noticed that on 12th November the noble Baroness, Lady Chalker, announced that the United Kingdom had contributed £¼ million to the Red Cross for work in the area. Have the Government contributed further to the work of the mission? Any help which the noble Baroness can give us will be greatly appreciated.
In a war of this kind it is inevitable that there will be many casualties among the civilian population. But when your Lordships last debated this situation on 21st November last year there was grave concern, not simply about the incidental casualties, but about the deliberate atrocities by the military, a matter to which the noble Baroness returned this afternoon.
As so often in conflicts of this kind, there is some evidence that atrocity has led to counter-atrocity, and that in turn to further retaliation. But I think most of your Lordships accept, as I certainly do, that the principal concern is about the conduct of the Azeri armed forces. I hope that the noble Baroness can tell us what representations have been made to the

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authorities on both sides to ensure that human rights and humanitarian standards which are now accepted by the whole international community are observed in the course of this conflict.
Finally, I turn to a matter which falls directly within the controls of countries outside the area. There is evidence—it has been referred to in the course of this debate—that a substantial contribution to the suffering has arisen from the supply of arms from outside regions, possibly to both sides in the conflict, but particularly, I accept, from Russia to Azerbaijan. I hope that the noble Baroness can tell us what steps have been taken with our EC partners, through NATO and through the United Nations, to stop that traffic in death and misery. Is it true, as the noble Baroness, Lady Cox, intimated, that the Foreign and Commonwealth Office has no policy on this matter in relation to the supply of arms from this country?
It is frustrating for all of us to know that there is so little which we can do to stop the suffering. It is doubtful whether there has ever been a time in history when the world has been so well aware, and so quickly aware, of tragedies in numerous regions and so powerless to avert them. It is becoming increasingly clear that there is a need for a permanent unit, hopefully under the control of the United Nations, to respond to various kinds of emergency. Too often we seem to wait until there is a major fire before we begin to plan and assemble a fire brigade.
At this stage in the human story we are discussing conflict resolution, peace-keeping and relief for the victims. I appreciate that we are very far from an international police force which is capable of stopping a civil war. But I believe that one day our descendants will be as amazed to read that the world could not maintain law and order in a specific place as we are when we read of wars between Mercia and Wessex or as Americans would be if they heard of a war between Maryland and Connecticut. Until that day we have to do what we can to alleviate the suffering. We are grateful for those who, like the noble Baroness, remind us so vividly where that suffering exists.
6.7 p.m.
Baroness Trumpington: My Lords, first, I should like to thank my noble friend Lady Cox for bringing this important issue before the House. She has described the appalling situation in Nagorno-Karabakh clearly and poignantly. I always feel at a disadvantage when I follow my noble friend because, so bravely, she has been there and I have not. I know from my own limited experience how people who are suffering value their plight being drawn to the attention of the wider world, in this case your Lordships' House. We are all grateful to my noble friend for once again focusing our attention on yet another part of our world where, as she said, people are in a state of crisis.
As the noble Earl, Lord Shannon, said, this dispute is complex and centuries old. The Armenians today
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fear a re-run of the appalling injustices suffered by their people earlier this century. The Azeris insist that they are merely trying to control their own territory.
We are impartial but have limited influence. To use that influence we must take the situation as it is—not as one side or the other thinks it ought to be.
We have no vested interest in this dispute. All we want is to see it resolved peacefully, in a way which does justice to the legitimate hopes of all concerned.
The conflict in Nagorno-Karabakh is only one of many other real and potential disputes across the former Soviet Union. In Tadjikstan, Georgia, Moldova and even in different areas of Russia rival groups aspire to greater autonomy or full independence. When the Soviet Empire broke apart, we and all our Western partners agreed that the very abruptness of events ruled out any attempt to redraw boundaries to do justice to all the rival clans.
The same considerations apply across the former Soviet Union as in Africa. There all the states have accepted, for better or worse, the fact of colonial borders. To do otherwise would open a Pandora's box of rival tribal claims with potentially terrible consequences.
That is why the international community recognised as independent states only the former Soviet Republics. Hence under international law the disputed area of Nagorno-Karabakh now is part of Azerbaijan. No country, not even Armenia itself, recognises it as an independent state.
International principles do not rule out changes to the status of areas such as Nagorno-Karabakh. But any changes must be made peacefully, with the agreement of all concerned. Azerbaijan will not cede independence to Nagorno-Karabakh. So a realistic solution must start from the fact of Azerbaijani sovereignty. But the Armenian community there cannot be expected to accept this unless they know that their rights will be respected, and their voices heard. This points to some form of autonomy, self-government, devolution of powers—call it what you will—for Nagorno-Karabakh. This basis for a solution—some sort of autonomy, under Azerbaijani sovereignty—is accepted by nearly the whole international community.
My Lords, I can assure my noble friend Lord Pearson of Rannoch that the world is not simply standing by while this dispute rages. For some months—originally at British initiative—the Conference on Security and Co-operation in Europe has endeavoured to mediate. The CSCE enjoys UN backing, and has the promise of NATO observers when a ceasefire is arranged. The CSCE talks in Rome under the able chairmanship of Mario Raffaelli have concentrated on achieving such a ceasefire. Progress has been slow, but planning for an observer mission is now at an advanced stage. It must be said that both the Armenians and Azeris in turn have obstructed the talks when winning on the ground.
In response to a point made by the noble Lord, Lord Archer, the advance monitoring mission of the CSCE hopes to visit the region, including Nagorno-Karabakh, early next month on a reconnaissance mission. Now, at last, agreement on a ceasefire may be

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closer. We have been urging the parties to accept it and move forward. My right honourable friend the President of the Board of Trade did so during a visit to Baku in September. He handed over a letter from the Prime Minister making the same point. My right honourable friend the Foreign Secretary has asked his Turkish colleague to use Turkey's influence with Azerbaijan to the same end. This is where matters now stand.
I want to try to answer as many points as I can, and I am grateful to my noble friend Lady Cox for giving me advance notice of her questions. My noble friend did not do it in the form of a question but she mentioned ethnic cleansing, as did my noble friend Lord Pearson of Rannoch. I must make clear that ethnic cleansing of any sort anywhere is completely deplorable, but the picture in Nagorno-Karabakh is not clear cut. Not only tens of thousands of Armenians but also almost the whole Azeri civilian population have been forced to flee Nagorno-Karabakh.
As the noble Lord, Lord Archer, said, this dispute has produced over 400,000 refugees from both communities. Any solution must uphold the right of all the people in and around Nagorno-Karabakh—Armenian and Azeri speakers alike —to live peacefully in their homes. I was particularly glad to hear the right reverend Prelate the Bishop of Guildford speak about the work of the World Council of Churches in the area.
I turn to a specific point raised not only by my noble friend Lady Cox but also the right reverend Prelate the Bishop of Guildford. They asked for assurances that ICRC aid for Nagorno-Karabakh will get through. The ICRC's reputation for humanitarian work in difficult situations is second to none. It is accepted by the Armenians and Azerbaijanis alike. It does not at present have a delegate in Stepanakert, the capital of Nagorno-Karabakh; it hopes to post one there soon. The ICRC has four delegates in Armenia and intends to increase them to six. Two travel to Nagorno-Karabakh each month. Last month they delivered the first winter food parcels, and our diplomats in Geneva keep in close touch with the ICRC head office to monitor their progress.
My noble friend asked what the Government were doing to bring pressure to bear on Azerbaijan. British aid to Azerbaijan is limited, consisting mostly of small know-how fund projects which support the transition to a market economy. This sort of carefully targeted support has intrinsic merit and should continue. We do not attach political conditions to humanitarian aid in Azerbaijan or anywhere else. More generally we will continue to press the government of Azerbaijan to accept a full ceasefire and start negotiating a settlement.
When he visited Baku in September my right honourable friend the President of the Board of Trade handed over a letter from the Prime Minister to President Elchibei making this point. I can tell the noble Lord, Lord Avebury, and my noble friends Lady Park of Monmouth and Lord Pearson of
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Rannoch that we also continue to urge Turkey, publicly and privately, to use its considerable influence with Azerbaijan to bring about an early ceasefire.
Lord Avebury: My Lords, could the Minister arrange for a copy of the letter from the Prime Minister to be placed in the Library of the House?
Baroness Trumpington: My Lords, I imagine so. The Government have no evidence of Turkish arms supplies to Azerbaijan, and Turkey has undertaken to respect the existing CSCE embargo on arms to the region. It is common knowledge that Turkish military advisers are helping the Azeris. In the CSCE the Government have raised the possibility of widening the existing arms embargo to cover all kinds of military assistance. The Government have pursued this proposal at this week's CSCE ministerial council meeting in Stockholm.
My noble friend Lady Cox quoted a newspaper report that claimed that the FCO had no policy on arms sales in Azerbaijan, and the noble Viscount, Lord Ingleby, asked a question on the same subject. That report was quite incorrect. The Government have not approved licences for the export of any military equipment to Azerbaijan, nor will they do so. We adhere to the embargo on the supply of weapons to the region called by the CSCE on 28th February. Indeed, during the CSCE ministerial council in Stockholm this week we called for an extension of this embargo to cover military assistance to the region generally.
My noble friend drew our attention to British trade with Azerbaijan, and not least the major investment by BP. She implied that this amounted to British endorsement of Azeri policies. The new countries of the former Soviet Union face unique problems in overcoming the ruinous legacy of communism. Trade is the most important way of helping these countries to establish themselves in the international community. The Government intend to boost British trade with all these states, including Armenia and Azerbaijan. I do not see why we should be ashamed of trading with BP in that country.
My noble friend Lady Park of Monmouth may be aware that we also have one large British project in Armenia put together by Simon Carves Limited. This project is nearing completion and should provide useful employment in Armenia. In short, commercial links are needed to help these countries establish themselves. Economic progress is the key to the transition from Soviet communism, but this should also extend to trade between the countries of the Trans-Caucasus. That is why we welcome Turkey's improving relations with Armenia and why we want to see all blockades lifted as rapidly as possible.
My noble friend Lady Cox spoke about the £250,000 the Government have contributed to the International Committee of the Red Cross for its work there. Most of this money will provide for 1,000 food parcels a month to be distributed in Nagorno-Karabakh this winter, and the remainder will be distributed between Armenian and Azeri refugees. I am delighted also to confirm today that the Government intend to make £200,000 available to the

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United Nations High Commissioner for Refugees. The UNHCR has just announced a six-month programme of emergency aid to over 140,000 Armenian and Azeri refugees from this conflict.
There is just one other point to which I should like to draw particular attention for the benefit of my noble friend Lady Cox. Hitherto we have asked the ICRC to deliver British assistance, but we certainly do not rule out using other organisations who are doing effective humanitarian work in Nagorno-Karabakh. I am pleased to tell my noble friend that the Government have decided to channel some assistance through Christian Solidarity International by providing the spare parts for ambulances which my noble friend Lady Cox delivered on an earlier mission.
The noble Lord, Lord Avebury, asked about air attacks on civilians. Military attacks against civilian targets are of course unacceptable. The Government have made this point directly to the Azerbaijani authorities and not least during the visit to Baku in September of my right honourable friend the President of the Board of Trade. The CSCE hopes to mediate a complete cessation of hostilities, including air attacks. We look to both Armenia and Azerbaijan to accept this.
The noble Lord, Lord Avebury, asked whether the United Nations had considered setting up a fund to collect and destroy weapons in the former Soviet Union. The United Nations has not discussed this. The states of the former Soviet Union are independent, and it is for them to settle their defence arrangements. We look to the states of the former Soviet Union to adhere to the provisions of the CFE treaty, covering conventional force reductions in Europe.
The noble Lord, Lord Avebury, and my noble friend Lady Park of Monmouth asked what role the Government envisage for Russia and the CIS in this dispute. It is not Russian government policy to take sides in this dispute. Russian troops remain in Azerbaijan and in Armenia. Some are reliably reported to have offered their services to one side or the other. The Government welcome any positive role the Russian government can play in mediating a solution, but such an effort must be part of the CSCE process.
The noble Lord, Lord Avebury, asked what the Government are doing in response to the appeal addressed to leaders of the G7. At this week's meeting in Stockholm of the foreign ministers of the CSCE, we are urging Armenia's neighbours to facilitate the delivery of humanitarian aid to Armenia. The Government have urged the Armenian government to contact the European Commission to arrange the rapid disbursement of over 20 million ecus of food and medical projects from the EC's loan to Armenia.
The noble Lord, Lord Avebury, and my noble friend Lady Park asked whether the Government accepted that United Nations peacekeepers had a role to play in Nagorno-Karabakh. The United Nations' Secretary General has sent two fact-finding missions to the region. He believes the CSCE is the right forum for negotiations. There is nothing to be gained by
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switching the negotiations to the United Nations, which is already heavily stretched. The CSCE can succeed if sufficient political will is demonstrated by the parties to this dispute. Without that political will, neither the United Nations nor any other forum or group of countries will bring about a solution. I tell the noble Lord, Lord Archer, that there are no immediate plans for either Azerbaijan or Armenia to join the Council of Europe. The European Commission has provided 1 million ecus of humanitarian aid, primarily to relieve the suffering of refugees in this dispute—
Lord Archer of Sandwell: My Lords, I am most grateful to the noble Baroness for giving way. I fear I must have been more than usually unintelligible. I did not intend to suggest that there were any plans for either Armenia or Azerbaijan to join the Council of Europe. I was asking whether the fact that Turkey had applied to join the Council of Europe might be used as a lever in encouraging Turkey to take a more constructive view.
Baroness Trumpington: I am sorry, my Lords; my carrier pigeon brought me the wrong information. I shall now turn to the points made by the noble Earl, Lord Shannon, and other noble Lords who reported the Azerbaijan threat to use nuclear weapons against Armenia. Azerbaijan is a signatory to the nonproliferation treaty as a non-nuclear weapons state. The Russian Government has confirmed that there are no nuclear weapons stationed on Azerbaijan territory. However, the question of the nuclear power station is a very dangerous one. There are considerable difficulties involved in recommissioning the Medzamor nuclear power station. It lies on a geological faultline and has fallen into disrepair following the earthquake. Armenia does not have the expertise to maintain or operate the plant, and the European Community is funding a safety study of this power station which will be completed in the Spring. We hope that the Armenian Government will await the outcome of this and other studies before taking any decision.
Reference to Turkey has occurred a lot in the debate, and relations between Armenia and Turkey are fraught with historical animosity and tragedy. However, both sides now seem to accept the need to build on normal bases. Turkey has agreed to deliver 100,000 tonnes of grain to Armenia and to allow other such deliveries to transit its territory. They have agreed to supply electricity to cover 20 per cent. of Armenia's energy deficit this winter at prices below those made to Turkey's domestic consumers. These are welcome developments, and we are urging the Turkish Government to go ahead with these undertakings.
In the snug and cosy atmosphere of the House of Lords, it seems almost an impertinence for me to stand here and make this statement, but it is a sad irony that Armenia and Azerbaijan—so new to the international community—should immediately find themselves locked into this costly and destructive dispute. Unlike most of the other former Soviet republics, these two states have made serious progress towards democracy.

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Both have held free presidential elections. Both have presidents previously imprisoned for their opposition to Soviet rule. Armenia's parliament consists of numerous parties. Azerbaijan plans fresh parliamentary elections next year. Both countries have ample resources and skills to draw on for their future prosperity if they can proceed in peace.
We hope that the CSCE talks will soon resume. They are the only realistic way forward. It is vital that the two sides play their parts in negotiating a settlement: their future is at stake. Armenians and
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Azerbaijanis alike will have to make historic compromises for peace and now is the time for them to do so.

Consolidated Fund Bill
Brought from the Commons, endorsed with the certificate of the Speaker that the Bill is a money Bill, and read a first time.
House adjourned at twenty-nine minutes past six o'clock.