Hong Kong: Democracy After 1997

HL Deb 29 January 1992 vol 534 cc1385-412

7.55 p.m.

Lord Wyatt of Weeford

rose to ask Her Majesty's Government whether they are satisfied with the arrangements made for the maintenance of democratic freedom and the administration of justice in Hong Kong after 1997.

The noble Lord said: My Lords, there are several problems which must be resolved if we are to do our best to ensure democratic freedoms and the proper administration of justice in Hong Kong after July 1997. I shall start with the composition of the Court of Final Appeal which will replace the Privy Council.

No one disputes that the Chief Justice of the Court of Appeal shall be a Chinese citizen, permanently resident in the Hong Kong Special Administrative Region. But the Joint Declaration of 1984 provides that the Court of Final Appeal, may as required invite judges from other common law jurisdictions to sit on the Court of Final Appeal". Those words are repeated in the Basic Law, which emerged from the Joint Declaration.

But now the Government have agreed to Beijing's demand that there can be only one overseas judge in the Court of Final Appeal. The Legislative Council in Hong Kong strongly believes—I agree with it—that that is utterly wrong. It is insistent that the number of overseas judges should be at the discretion of the Court of Final Appeal itself, as was always intended. LEGCO passed a resolution to that effect by an overwhelming majority of over three to one. The court might not want to co-opt any overseas judges or it might wish to co-opt more than one; but insisting on the power of discretion of the Court of Final Appeal is not a trivial issue. It is a vital safeguard against the court being packed by judges who might be inclined to a more Beijing interpretation of justice than to the British approach, which has rooted itself in Hong Kong.

Her Majesty's Government must press for that. It is not in conflict with either the Joint Declaration or the Basic Law. Giving the Court of Final Appeal greater flexibility would in fact be helpful to Beijing. It would increase Hong Kong's confidence in Beijing's fair mindedness, making its relations with the Hong Kong Special Administrative Region smoother from the start. So would an agreement about the number of the People's Liberation Army to be stationed in the middle of Hong Kong. Beijing has hinted that there may be only about 3,000 troops, though that might well be too many.

The nature of soldiers everywhere is to drink occasionally and then have rows with members of the local population. Are PLA soldiers to be above the law if they start a fracas? There is a fear of unhappy incidents which could lead Beijing to impose some kind of martial law. That point must be clarified to protect Hong Kong citizens and allay their fears. The fewer PLA troops that there are in the middle of Hong Kong, the better. They can always be sent for instantly in an emergency. It must be in Beijing's interests to keep good relations with the local population.

The naval base is in the middle of the business district of Hong Kong. There are many suitable places, such as Stonecutters Island, to which the naval base could be removed without any loss of efficiency but with a gain in Hong Kong confidence that Beijing will not apply a heavy hand.

My next point concerns the functioning of the democratic parliamentary process. The Legislative Council contains 60 members; 18 were appointed by the governor and 24 were indirectly elected by a tiny number of voters in sections allocated to various professions and occupations. For the first time last September 18 members were elected by universal suffrage of the whole population. The United Democrats, led by Mr. Martin Lee, swept the board. Seventeen of those democratically elected seats are now held by those of liberal persuasion. They are not of the liberal democratic kind represented in your Lordships' House, but are staunch believers in capitalism and low taxation; though like all parties in the United Kingdom they claim to be concerned with improving social services.

The governor refused to put Mr. Lee on the Executive Council. In Mr. Lee's view he and his supporters are the only truly democratic representatives and should have formed a majority of the Executive Council, which is the equivalent of the Cabinet in this country. Now OMELCO, which represents members of the Executive and Legislative Councils, wants more universal suffrage in the 1995 election. It requests that half the members should be directly elected and only half elected by the indirect election method. That would differ from the Basic Law, but not by much. Beijing has already agreed that, in 1999—the election after that to be held in 1995 —24 should be directly elected by universal suffrage and that, in the year 2003, 30 should be elected by universal suffrage. Beijing accepts in the Basic Law that after 2003 there should be a continuing progress towards universal suffrage for all the Legislative Council seats.

Our Foreign Secretary has said that he will raise the matter in Beijing, but without much hope of success; and he has not yet raised it. The British Government are afraid that by pressing the issue of a more democratically elected Legislative Council its members in Hong Kong will dangerously antagonise Beijing. But their constituents want them to press the issue. That is what they were sent to LEGCO to do. The Foreign Office says, "No, we know much better what's good for you". The great majority of the people of Hong Kong says, "That is for us to decide. You are not our nannies. It's we, not you, who will have to deal with Beijing after 1997".

I believe that we should let the people of Hong Kong act as they think fit, and that the governor should make no attempt to block any amendment that they make to the existing electoral procedures. I do not accept that if LEGCO decides to speed up the democratic process already accepted by Beijing that Beijing in July 1997 would immediately reduce the number of directly-elected members to 24. It would be very poor public relations if they did so, and they are not such fools.

I now come to the growing resentment against the British Government and Britain. The people of Hong Kong feel that we are so preoccupied with electioneering that we are ignoring their affairs at a critical moment in Hong Kong. They are appalled at our extraordinary behaviour in announcing the imminent removal of the present governor without naming a replacement. Sir David Wilson is now seen as lacking the essential authority to deal with Beijing. His faithful and loyal services do not merit that shabby treatment.

One strongly held view in Hong Kong is that the last British governor should be Her Majesty's ceremonial representative while waiting to haul down the Union Jack when Beijing takes over the last jewel of the British Empire. Otherwise he should be confined to matters of defence and foreign affairs.

The real work of administration, according to that thinking, should be done by a deputy governor, a local Hong Kong Chinese resident. It is an idea with much to commend it. But whatever the power of the new governor it is essential that he be appointed now to end damaging uncertainty. In my view he should be a person with presence, courage and high political skills. He should not be either a past or present civil servant, however distinguished.

Even if there were a deputy governor, it is of great importance that the new governor's proven wisdom and sensible advice should be available to the Hong Kong administration. The choice should not be a party matter. I understand that there have been no consultations between the Government and the Opposition as to who should be chosen. If that is so, it is unforgivable on a non-partisan matter. There is no reason why the new governor should not be a member of the Labour Party. In some ways it would be desirable. I can think of one noble Lord in your Lordships' House who, through his experience and vigour, would be admirable. I can think, too, of a second Labour Member in another place who would do the job excellently. However, I shall not name either publicly for fear of spoiling their chances.

In Hong Kong itself I know of at least two with the required ability—one Chinese and one British. Their names, too, I shall not mention publicly. I believe that either would have strong support from the local community, whether or not connected with business. Unfortunately, at present I cannot think of anyone now or previously in the Government who would be suitable. Of course, there might be such a person but he should be acceptable to the Opposition should he emerge.

Delaying the choice because of our election is shameful and foolish. It is understandably seen in Hong Kong as a parting insult both to Hong Kong and Beijing. Beijing is showing its good faith and confidence in Hong Kong's future by huge investments from its banks in Hong Kong. It is also showing it by its warm welcome to Hong Kong entrepreneurs in Guangdong. Already the people of Hong Kong employ over 3 million people in that adjacent province. With far higher wages, those people are learning the delights of capitalism and enjoying what, to them, are novel displays of uninhibited discussion on Hong Kong television and radio.

Beijing has described its takeover of Hong Kong as two systems in one nation. I do not believe that the rulers of Beijing have the slightest intention of wrecking the Hong Kong system. China's finances would collapse without it. I have no doubt which of the two systems will dominate China's commerce and industry after 1997. Between now and 1997 it is up to us to create the atmosphere in which that can happen smoothly and fruitfully.

The Government are failing in their duty to business in Hong Kong, whether locally or foreign-owned. They are letting down the people of Hong Kong who are anxious to preserve the best of what they have learnt of the British way of life. They are giving Beijing the impression that we in this country are too busy watching the opinion polls to notice the urgency of attending to opinion in Hong Kong. I commiserate with the noble Earl for having to answer my Question so quickly after the second debate. However, I hope that he will urge upon his senior colleagues at the highest level that they should take a brief interlude from electioneering and attend to the appointment of a new Governor of Hong Kong. It really will not take them more than a couple of hours.

8.10 p.m.

Lord Willoughby de Broke

My Lords, I thank the noble Lord, Lord Wyatt, for giving us the opportunity to debate these urgent questions. It is difficult to follow him because he has covered the points so admirably and clearly. The questions that he has raised deal with democracy and the administration of justice. It is right to consider whether Her Majesty's Government are dealing fairly with the matters raised in the terms of the Joint Declaration.

The Joint Declaration enshrined the goals of autonomy and democracy for Hong Kong. That commitment was clearly spelt out in the debate on the Joint Declaration in another place in December 1984. My right honourable friend Mr. Richard Luce, then the Minister of State at the Foreign and Commonwealth Office, said: We all fully accept that we should build up a firmly-based, democratic administration in Hong Kong in the years between now and 1997".—[Official Report, Commons, 5/12/84; col. 470.] There is a great deal of concern in Hong Kong that that firmly-based, democratic administration is not in place. There is at the moment a curious hybrid which could have come straight out of Alice in Wonderland. There is an elected opposition and a non-elected, chosen, appointed administration consisting of appointees of the governor and members of various sectional interests. Would it not seem odd if there were an elected government and an appointed opposition? Will my noble friend Lord Caithness tell us whether that is the right way forward for Hong Kong?

The noble Lord, Lord Wyatt, referred to the elections in September. However small the turnout, and the issue has been criticised, there is no gainsaying the fact that the United Democratic Party claims to be and is the only truly representative political party in Hong Kong. Yet, as the noble Lord pointed out, that has not been reflected in appointments made either to the Legislative Council or to the Executive Council. Ought some consideration be given to that at this stage? It is seen as an insult to the intelligence of the voters and to the democratic process itself.

Disillusionment with the niggardly progress to democracy has been compounded by the clumsy handling of the appointment of the successor to the present governor. That is seen as a slight to Hong Kong and to the present governor. The strong impression is that once again Britain has let Hong Kong down. Clearly that was not the intention but I am afraid that it has been the effect. The question of a successor to the present governor is of great—probably of prime—importance in Hong Kong. With only 5½ years remaining of our stewardship it is of key importance that a person who is credible here, in Hong Kong and in China should be appointed. Such a person should possess a great many attributes. He should be respected in Hong Kong, Westminster and China. He should have an understanding of the commercial realities that obtain in Hong Kong. He should be an effective leader and spokesman for Hong Kong.

That is quite a tall order but there is such a person. I do not share the diffidence of the noble Lord, Lord Wyatt, in naming that person. If your Lordships substitute "she" for "he" you may find the answer. I refer of course to the noble Baroness, Lady Dunn, who is at the same time politician, businesswoman and diplomat. Her appointment would be welcome in Hong Kong. It would give that territory something of the political confidence that it seeks in the years remaining until 1997.

I hope that the Government will address the issues that were raised so cogently by the noble Lord, Lord Wyatt. I look forward to hearing my noble friend's reply.

8.15 p.m.

Lord Ennals

My Lords, I too am grateful to the noble Lord, Lord Wyatt of Weeford, for facilitating the debate. I agree with much that he said, although not all, and with much that was said by the noble Lord, Lord Willoughby de Broke. I believe that Parliament, especially another place, has given inadequate attention to developments in Hong Kong during recent years. It has overlooked the significance of the five years between now and the time when responsibility is to be handed to Beijing.

I agree with the noble Lord, Lord Wyatt, that there has been a real failure on the part of the British Government to formulate an adequate strategy in the negotiations over Hong Kong. I believe that the Chinese have taken advantage of that. I have said on a number of occasions when talking about Tibet that the Government have been prepared never to be strong but always to be weak. I do not believe that is the best way to have satisfactory and effective negotiations with the Chinese.

On 22nd January I attended a business conference at the Queen Elizabeth II conference centre. The conference was brilliantly organised and magnificently attended by more than 600 people. I cannot adequately praise the people of Hong Kong for their energy and enthusiasm. Their economy and that of the 18 million people in South China within the economic zone that is now influenced by Hong Kong is surging ahead. One of their few complaints is that the deplorable economic management of affairs in the United Kingdom is something of a drag upon their rate of growth.

If Britain appears to forget about Hong Kong it is not surprising that Hong Kong appears to have little or no expectations of Britain. It is painful to see Britain becoming more and more isolated and irrelevant in Hong Kong and to see the situation in Hong Kong becoming more marginalised by British politicians.

However, the case against the British Government is not merely of neglect but of extraordinary insensitivity. That was sadly demonstrated by the handling of the governor, Sir David Wilson. He is a man of outstanding ability who will be warmly welcomed in this House, as was the noble Lord, Lord Maclehose. We look forward to hearing from him. In my view Sir David was publicly humiliated by the Prime Minister and the Foreign Secretary in the announcement that he would be retiring but that his successor would not be appointed until after the election. I do not argue that an appointment ought to be made before the election; I argue that no such statement should have been made about Sir David's retirement. He is a highly respected man. On 22nd January in the Legislative Council the honourable J. D. McGregor said: The lack of information is alarming and, frankly speaking, disgraceful and insulting to Sir David Wilson and the people of Hong Kong… Who on earth in the British Government decided to announce Sir David's retirement and not his successor? I believe that this was a real blunder and that it has seriously reduced Sir David's standing and credibility during his remaining months of office. It also suggests that the British Government is insensitive to the very delicate situation in Hong Kong where six million people ponder their future". I agree with that.

As the noble Lord, Lord Wyatt, said, the elections in September 1991 were a watershed in Hong Kong. That was the date when—in the words of Mr. George Foulkes the Labour spokesman in another place—the first shafts of democracy lit up in the Territory. As has been said, the voters were allowed to elect 18 out of 66 candidates for the legislative council. The United Democratic Party, led by Martin Lee, won 12 of the 18 seats and five of the six remaining seats went to people with liberal tendencies. It was a stunning victory for those who really believe in democracy. Many of them were deeply disappointed that the appointments in no way recognised the will of the people of Hong Kong.

At the conference last week to which I have referred, a Mr. Stephen Cheong, who has been a LEGCO member since 1980, said: We in Hong Kong have the funniest situation in terms of politics: the government in power are not allowed, or see it as undesirable, to form their own party, while the largest party in the legislative assembly remain an opposition party. The present state of affairs is unimaginable in any western democratic countries". He went on to say: If nothing is done to rectify this situation, then what we see today may well be the beginning of a period of anarchy in Hong Kong". I hope that that is not true but the British Government have an obligation to recognise the strength of feeling which now exists in the Territory.

In the course of the next few weeks something must be done to rectify the situation. It is a pity that the Government did not introduce an element of democracy years ago. It would be absurd to assume, as the Government seem to, that agreements already reached with China are set in stone. After all, there are five years between now and 1997. There must be some flexibility. I welcome statements by Labour leaders that, if elected to power, they will begin early discussions on how to improve the democratic conditions in Hong Kong. Of course we want to see a free press, an independent judiciary and a democratic legislature. The political situations in Hong Kong and China are also not set in stone. In this country we are bound to have an election in the next few months. In China there must be changes as younger men are bound to succeed to prominent positions in the increasingly aged leadership of China. China is unlikely to avoid some of the winds of change which have blown from Europe, Africa and Latin America. It may be that the speed will not be so great but I do not believe that there will be no change in China in the course of the next five years.

Hong Kong itself may help to bring about the change. We have already seen the remarkable speed with which China's southern provinces have broken free from a command economy. In helping to create a climate which is free from the central control of Beijing, Hong Kong is helping to create a climate in which political differences with Beijing can be submerged. I believe that the taste of economic freedom is bound to create a taste for political freedom so far denied to the rest of China's population and, in a sense, to its colonial peoples.

Of course the Joint Declaration and the Basic Law remain the foundations on which Hong Kong's future must be built but the five remaining years of British rule must be years in which there is everything to play for. It is a period in which the old men calling the shots in Beijing and the has-beens in Westminster will be replaced by a more rational, accommodating and imaginative leadership. I have great confidence in the people of Hong Kong, in their judgment and ability to lead. Without mentioning any names, I agree that when one looks around for the next governor, we should look seriously at those who come from Hong Kong and who know and understand the nature of the people. I urge the Government, in the weeks before the election, to turn their minds away from electioneering and confront this fundamental problem which must be faced in Hong Kong. They must have a strategy to take us through the next five years.

8.24 p.m.

The Lord Bishop of Worcester

My Lords, I am grateful to the noble Lord, Lord Wyatt of Weeford, for initiating this debate. I must apologise to the House because, for unavoidable reasons, I may have to leave the Chamber after my speech. I hope to be back to hear the Minister's reply but I apologise to the noble Lords, Lord Derwent, Lord MacLehose and Lord Geddes, if I do not hear their speeches. I shall certainly read them in Hansard.

As a bishop I am in contact with Hong Kong through the Anglican communion network. There is an Anglican bishop in Hong Kong and through Church House I have been in contact with him. In 1984 and 1990 a delegation of the British Council of Churches was invited to Hong Kong. The message which was brought back was that we should alert people to Hong Kong's situation and needs.

Through my contacts I have found that the first thing which seems to be lacking is confidence in the British Government —with their great tradition of colonial experience and government—to see their responsibility for Hong Kong through to the moment at which it joins the mainland of China in 1997. That 60,000 people left Hong Kong in one year is an indication of that lack of confidence. The bishop tells me that the people of Hong Kong are conscious of the fact that the right of abode was taken away from them in 1962. They now have the status of British dependent territory citizens. They realise that in 1962, when their right of abode was taken away, the United Kingdom was concerned not to have large numbers of people entering the country because our services would inevitably break down. They understand that. However, the people of Hong Kong need effective citizenship. If they can be given that, and if there can be movement towards that between now and the time at which they join the mainland of China, there will be less desire to leave. Even so, they need an escape clause to prevent their becoming prisoners on their own island. That does not mean that they would use the clause. They would, however, have a sense that they were not trapped.

The other fear conveyed to me is one already mentioned by noble Lords; namely, that the pace of change has been deliberately slow out of a desire not to offend the Government of China. I should like to be reassured that that is not so. We should not be proud to think that we have slowed down the pace of change out of a desire not to displease mainland China. Indeed, Jan Morris, writing from Hong Kong, has said that the Chinese Government have made known their opposition to, for example, some of the suggestions which have been made in this House today.

There could be a restoration of confidence moving towards democracy and democratic institutions. Mr. Douglas Hurd and Sir Geoffrey Howe have said that that is desirable. It is possible that by 1997 a fully elected legislative assembly could be in place. As I said, that would prevent a flow of immigrants to Britain. There could be the appointment of a chief executive by a representative assembly.

An enforceable Bill of Rights is also needed. The present Bill of Rights lacks two very important elements. It lacks the right to self-determination and the right to elect political representatives. If there came to be a clash with a strong Chinese Government the Bill of Rights would not stand up.

I shall not repeat what has been said about the court of appeal. I am told that the Executive Council, after a long debate, rejected the composition of that court of appeal. If I were to say anything further about the appointment of a new Governor, it would be that there is a great desire among the politically aware in Hong Kong that consultation shall take place. Can we be assured of that?

I want to move on to the question of religious freedom. Recently, Graham Hutchings of the Daily Telegraph and Raymond Whitaker of the Independent drew attention to the fact that mainland China is cracking down on religion, largely because it sees that in Eastern Europe the Churches, to a large extent, were the midwives of the revolution—certainly in Poland, East Germany and possibly in Czechoslovakia—in a secret and hidden way in co-operation with others. It is determined that that shall not happen in China.

It is possible that those who worship or gather in groups outside the five official religions—Buddhism, Catholicism, Protestantism, Islam and Taoism—could be charged with counter-revolution and colluding with foreign states, for which the punishment is from 10 years up to life imprisonment. Recently, 32 Catholic bishops, priests and lay workers were arrested. In short, there is a new hardness towards religion. I ask my noble friend Lord Caithness, first, to reassure me that it is something of which the Government are aware and, secondly, that it is something upon which he will seek further information.

I offer the hope that there can be a rebuilding of confidence and trust in the British Government; that there can be the establishment of effective citizenship, which is more important to many people in Hong Kong than the restoration of right of abode, and that along with that will go movement and education towards democratic styles and institutions. It is not simply a matter of structures. It is also a matter of encouraging participation.

Finally, I raise an issue where the British Council of Churches' delegation found real fear and foreboding. It was mentioned by the Bishop of Hong Kong, Peter Kwong. It is that religious freedom could be eroded for fear that the Churches might be as effective in the East as they were in Eastern Europe in helping to roll back the Communist regime.

8.34 p.m.

Lord Derwent

My Lords, I thank the noble Lord, Lord Wyatt, not for tabling the Question, nor because I necessarily agree with everything that he said, but because I believe that the greatest protection the people of Hong Kong have is that their affairs should be kept constantly in the public eye.

The Question of the noble Lord is whether the Government, are satisfied with the arrangements made for the maintenance of democratic freedom and the administration of justice in Hong Kong after 1997". I am sure that the Government's Answer to the question will be, "no". So far as I am aware, the Government have never claimed that the arrangements which emerged from the Joint Declaration and the Basic Law are wholly satisfactory. The more relevant question is whether the arrangements are as satisfactory as can be achieved at present. There are certainly anomalies to which reference has already been made. It is an anomaly that the largest party in LEGCO is in opposition. It is an anomaly that the Opposition is not an alternative government since it can never, under current arrangements, have a majority in the Legislative Council. There are, therefore, important respects in which democracy as we see it in Hong Kong today is deficient.

That is not to say that the degree of democracy already achieved is useless. An article in the Financial Times yesterday rightly pointed out that, since September's elections the legislature is now a body where virtually all aspects of the Government's legislative programme are vigorously debated and, in some cases, changed. I am sure that process will continue and develop further after the next round of elections. Perhaps we should therefore not be too dismissive of what has already been achieved.

I beg your Lordships not to job backwards and reflect too much on what might or might not have been included in the Joint Declaration or the Basic Law. We must face reality as it is today. The Joint Declaration exists; the Basic Law exists. The Chinese have said that they regard both documents as sacrosanct. The documents are clearly not perfect. How could they be since they represent a compromise? As in all compromises, the different provisions cannot be disentangled. If one side seeks to ignore or reinterpret one provision, then the other side will seek to ignore or reinterpret another. At this juncture that does not seem to be a useful way forward. Better to build on what we have.

In practice it means that neither the United Kingdom nor the People's Republic of China should at this stage of the proceedings do anything to rock the boat. By that I mean they should not seek to move unilaterally in a direction which they know in advance to be unacceptable to the other side.

If that sounds craven, let me invite noble Lords to consider what is actually happening on the ground in Hong Kong. In the weeks since agreement with China was reached over the airport, confidence has greatly improved. The stock market is at an all time high. Business is doing better—certainly much better than it is, for example, in this country. New investment is coming in, which means that there are jobs and prosperity for all. Why is that? It is not because the agreement is perfect but because the mere fact that an agreement exists between the two sides on a range of issues means that everyone knows, or thinks they know, where they stand and can plan accordingly. On the other hand, each time we are at public loggerheads with the Chinese tension rises, investment falls away, confidence drops and prosperity is at risk. If Hong Kong is not prospering in 1997 the Chinese will have no incentive to keep to the Joint Declaration.

The need to reach agreement with the Chinese does not mean that progress cannot be made towards a greater degree of democracy; towards improved arrangements in regard to the administration of justice or in other directions. What strikes all of us who have daily dealings with Hong Kong is the way in which the economies of Hong Kong and China are becoming not only interdependent—they always were—but that there is now in reality only one economy covering Hong Kong proper and the neighbouring provinces of China. The point has now been reached where it is impossible—I repeat, impossible—for China to damage the economy of Hong Kong without inflicting serious, perhaps disastrous, damage on the economy of China itself.

When one thinks about it, in the real world China has much more to gain from the continued prosperity of Hong Kong than we do. That being so, the right way forward is the one that the British Government are following. My right honourable friend the Foreign Secretary has promised that he will continue to press on the Chinese our views on the best way to achieve the continuing prosperity of Hong Kong. Even more important, he will be pressing the views of the Hong Kong people.

I do not wish to repeat what noble Lords have said, but I wish to digress by saying that I too regret that my right honourable friend will no longer be assisted in that task by Sir David Wilson. This was no time to change the Governor. Those in this country who have campaigned against him have little to be proud of.

There is no point in striking attitudes. We believe in democracy for democracy's sake. The Chinese Government do not. So slanging matches on that subject lead to a dead-end. That is the trouble with campaigns which merely have as their theme "more democracy must be good". Rather, let us use up our ammunition and our persuasive powers in getting the Chinese to move forward on specific issues—many of which have already been summarised by the noble Lord, Lord Wyatt of Weeford—not to win a political argument but in order to further the future well-being of the people of Hong Kong.

8.42 p.m.

Lord MacLehose of Beoch

My Lords, I too would like to thank the noble Lord, Lord Wyatt, for introducing this debate. Like many other noble Lords, he mentioned various things about the Governor. I claim to have a special knowledge about gubernatorial matters. The point was made that the Governor is now a kind of lame duck and that the Government have just about killed him off. He was here the other day and I have never seen any duck less lame. He was in exuberant form. It is delightful that he is going to be joining your Lordships in this House. He will make a great contribution.

There was strong criticism of the announcement that the Governor is going to retire without a successor being named. Think of all the fun that it has given to journalists playing this game! I noticed your Lordships joining in the game of suggesting who will succeed him. My retirement was announced four months before I retired. The name of my successor was announced one month before I retired. I did survive and so did Hong Kong. However, I say this to those who are to appoint him: they will be hard put to find somebody as good as the person they are allowing to go.

It was a great pleasure to follow the noble Lord, Lord Derwent. I agreed with everything he said, and particularly with his presentation of one's attitude to China in these circumstances. He referred to the importance of not harking back to past agreements; the importance of not proceeding in a confrontational manner, and the importance of seeing things to some extent from the Chinese point of view. I am thinking of the question of democracy as being something which is European and utterly un-Asian. These matters have to be dealt with with great care.

I would like not to follow the noble Lord in all the points he made. I wish to proceed somewhat differently. I begin by saying what I believe people in Hong Kong would like to see. They are well-known for their pragmatism. They understand the political realities of their own situation. With only five years more of British responsibility, I believe that what they want to see is a strong and efficient public service. That they have. I believe they wish to see a political structure which will give them, on the one hand, assurance of a continuation of their personal freedom and, on the other, one that does not provoke Chinese suspicion and consequent instability.

A great deal has been said about that this evening. I entirely agree that more work has to be done on this matter. The people of Hong Kong want to see a system of justice which is fair and impartial. That they certainly have and there is every prospect of it continuing. They want an economic environment in which they and their families can prosper. That again they assuredly have, and I shall return to it. I was very glad about the way in which the noble Lord, Lord Ennals, referred to developments in China.

There is a great deal of common ground in Hong Kong about what they want. Of course opinions inevitably differ on some matters, but the community is at one about the need to establish a sound relationship with China and to avoid measures which may generate instability through friction with China. I know what fun it is to confront China from the Benches of your Lordships' House. It is an entirely different matter to do so from Hong Kong and a good deal less wise.

Noble Lords have referred to the issues which are under debate at present; for instance, the progress of democracy and the composition of the Court of Final Appeal. In both those instances the choice seems to lie between an ideal solution, which will probably not be agreed with China and so would add to uncertainty about the future in 1997, or accepting something workable now in the knowledge that it will not be an issue when the difficult time of 1997 comes. I am advised that about these issues there is no consensus in Hong Kong. I believe that the choices are best left to the people in Hong Kong and to their Legislative and Executive Councils to decide. I do not believe that we would be doing the people of Hong Kong a service by encouraging any particular solution. Our overriding goal should simply be to ensure the smoothest transfer of sovereignty in 1997 and the smoothest possible lead-up to that date.

This debate has raised various criticisms of the British Government and of what is happening in Hong Kong which may raise doubts about Hong Kong's future. I do not share them. I also sensed an underlying new feeling of optimism in your Lordships' House which I am not sure that I have felt before. I entirely agree that there is a current moving very strongly in Hong Kong's favour. The place itself is booming. It is the centre of a huge area of economic growth in South China which includes 60 million to 100 million people. Economically, it is the fastest growing area of the world, with huge benefits to the people who live there.

Let us remember that this is the product of Chinese policy. It is the product of Den Xiaoping's open-door policy, which has been persisted in during these difficult past years in China. Hong Kong is a key element in it. It was significant that Den Xiaoping himself, who so very rarely appears in public, made a public appearance a few days ago and reaffirmed that policy. He did that in Chungshan on the borders of Hong Kong. That is something from which we can take a great deal of confidence.

This economic thrust from South China is in fact underpinning Hong Kong. In considering the number of details that I am sure will come to your Lordships about Hong Kong in the course of the next few years, let us take comfort from the fact that this force is there and is working very much in Hong Kong's favour.

8.50 p.m.

Lord Geddes

My Lords, I wholeheartedly endorse the comments made by, I think, all noble Lords who have spoken, and particularly the noble Lord, Lord MacLehose, with regard to Sir David Wilson. I can best sum up by saying that our gain in this House is going to be Hong Kong's loss. He has done a quite excellent job for Hong Kong in extremely difficult and increasingly difficult circumstances. I do not, however, intend to enter the lists of the guessing game as regards his successor.

Not for the first time, we are truly indebted to the noble Lord, Lord Wyatt of Weeford, for bringing Hong Kong to our attention. His Question refers both to "the maintenance of democratic freedom and the administration of justice in Hong Kong after 1997". All noble Lords who have spoken have addressed the former more general issue of democratic freedoms, and I should just like to make one comment in that context: that is with regard to passports, a subject that I have studied closely since the then British Nationality Bill over a decade ago.

In the Chinese memorandum of 19th December 1984, which was attached to the Joint Declaration of the same date, considerable comfort could, and hopefully still can be, drawn from what are now called marginal paragraphs 233 and 234 with regard to the Chinese recognition and tacit approval of British Dependent Territory citizens and their BDTC passports. However, the only reference to passports in the Basic Law is in Article 154, which refers to the government of the Hong Kong special administrative region issuing passports, of the Hong Kong SAR of the People's Republic of China to all Chinese citizens who hold permanent identity cards of the region, and travel documents of the Hong Kong SAR of the People's Republic of China to all other persons lawfully residing in the region".

While I do not see a conflict between the Joint Declaration of 1984 and the Basic Law of 1990, I should be grateful if my noble friend Lord Caithness could advise the House whether those marginal paragraphs 233 and 234 in the Joint Declaration are still valid, whether British national overseas citizens and therefore holders of the BN(0) passports will be similarly recognised by the People's Republic on and after 1st July 1997, and why the Basic Law made no reference to either BDTCs or BN(0)s and their passports.

I shall now restrict my comments to "the administration of justice in Hong Kong after 1997" and in particular to the Court of Final Appeal. There have been numerous suggestions in the press and elsewhere to the effect that Britain has yet again in some way "sold out" to the Chinese in the matter of the Court of Final Appeal. Without for the moment commenting on the merits of the agreement reached in September last year by the joint liaison group, I think it would be appropriate first to look at the printed published text.

Article 82 of the Basic Law states as follows, and the noble Lord, Lord Wyatt, has already mentioned this: The power of final adjudication of the Hong Kong special administrative region is vested in the Court of Final Appeal in the region, which may as required invite judges from other common law jurisdictions to sit on the Court of Final Appeal". Those are important words, and I shall come back to them in a minute.

The only reference in the Joint Declaration and the Basic Law to the number of judges connected with the Court of Final Appeal is with the tribunals set up to make recommendations regarding the removal of judges from that Court of Final Appeal, and indeed of the chief justice of the Court of Final Appeal. In both the Joint Declaration and the Basic Law such a tribunal is to consist of no fewer than three (or, in the case of considering the chief justice, five) local judges. Those numbers do not refer to the Court of Final Appeal itself.

My reading of the two relevant documents—that is, the Joint Declaration and the Basic Law, and it was on those two documents that the joint liaison group were working—is that, with the exception of the chief justice of the Court of Final Appeal and indeed the chief justice of the High Court of the Hong Kong SAR (both of whom, as the noble Lord, Lord Wyatt, has already advised us are required to "be Chinese citizens who are permanent residents of the region with no right of abode in any foreign country"), there neither is nor was any definitive statute with regard to the number of judges constituting the Court of Final Appeal nor to the nationality or domicile of those judges other than the chief justice himself.

We then turn to the agreement reached by the joint liaison group in September of last year; namely, that the Court of Final Appeal shall consist of five judges in any sitting made up of the chief justice of the Court of Final Appeal, three permanent Hong Kong judges —and an important wording in parenthesis here—who may be local or expatriate, and, depending on the needs of each particular case, one remaining judge to be drawn from a list of non-permanent Hong Kong judges or from a list of distinguished judges from other common law jurisdictions. Here we are getting the same phrase coming through again; other common law jurisdictions.

On 4th December last year the Legislative Council rejected by 34 to 11 the joint liaison group's agreement. I have read with the greatest of interest the speech of the Hon. Simon Ip Sik-on (the representative on LEGCO of Hong Kong's legal profession). As I well know, it is at the very least foolhardy for a layman such as myself to disagree with a lawyer, particularly one as eminent as Mr. Simon Ip. However, while I agree with much of his speech, I disagree on two specific and, I suggest, fundamental points.

First, he said: the agreement reached by the JLG … has altered the clear wording of those documents". namely, the Joint Declaration and the Basic Law. As I read it, that agreement by the JLG in no way contravenes either the Joint Declaration or the Basic Law even if, as some of your Lordships and much of the press think, it may not entirely live up to the hopes and aspirations of some.

Secondly, Mr. Ip said that he considered that: the composition of the Court of Final Appeal and the court's unrestricted power to invite overseas judges to sit on it [was] more important than setting up the court early". He went on to say that it was: difficult to imagine a court structure that is consistent with the Basic Law that is less flexible than that we are faced with today".

My Lords, I wonder. The noble Lord, Lord MacLehose, if he did not refer to it, certainly inferred from this point that it was impossible to know what sort of Court of Final Appeal might be imposed in July 1997. What Hong Kong needs is stability, and it is running out of time. The smooth transition of the legal system is of paramount importance for the future of Hong Kong, and the vesting of the power of final adjudication in Hong Kong is the most significant aspect of this.

Hong Kong needs to have a Court of Final Appeal in place by 1993 so that it can have four years to establish its credentials and iron out any wrinkles before the territory reverts to China in July 1997. If this can be achieved, the aim of maintaining continuity within the legal system will be greatly assisted, and in addition its early establishment will bring further confidence and stability not only to the judicial system but also, and more widely, to Hong Kong as a whole.

On 6th December 1991, two days after the LEGCO debate, in the context of that three to one rejection of the agreement reached by the joint liaison group, the South China Morning Post commented as follows in its leading article. I unashamedly quote this paragraph in full because it is of considerable importance. It reads: There is, however, a way out of the impasse which Hong Kong can chart itself, without any constitutional change. Instead of trying more backdoor political manoeuvres, the Hong Kong Government can strengthen the territory's judiciary. Accepting that localisation of the judiciary has been a failure to date"— that is a moot point— especially at High Court level, Hong Kong should invite the most eminent judges available from other Common Law jurisdictions"— here is the same phrase coming through again— to serve on the bench for the next six years, preferably longer. Not only would Hong Kong's judicial system benefit from their presence, but they could strengthen the pool of talent from which Hong Kong could choose candidates to sit on a Court of Final Appeal. Overseas expertise would therefore be injected into the system, without an argument over how many judges from other countries should be invited to sit in the appeal court. Since it would be a domestic decision, it would be entirely within Hong Kong's right to make it, and does not require approval by either China or Britain".

In my experience—and here again I wholly endorse the remarks of the noble Lord, Lord MacLehose—Hong Kong is nothing if not an immensely practical place. The action proposed in the South China Morning Post leading article seems to me to be an eminently sensible way of addressing what is clearly a difficult and extremely important problem. Surely it is in the interests of all concerned—Hong Kong, China and the United Kingdom—to accept the agreement as worked out in the joint liaison group and now take action to strengthen Hong Kong's judiciary along the lines advocated in that leading article.

9.2 p.m.

Lord Bonham-Carter

My Lords, I join other noble Lords in thanking the noble Lord, Lord Wyatt, for asking this Unstarred Question. It is important that in your Lordships' House the issue of Hong Kong and its future should be raised at regular intervals. I find myself in broad agreement with the tenor of what the noble Lord, Lord Wyatt, said. I am sorry that he is mildly unhappy that Martin Lee and his colleagues have given themselves a liberal label, but that is their choice. Let me comfort the noble Lord. No one will ever affix that label to him in any of his political manifestations. I agree however, that the main issues we have to address are those of the Court of Final Appeal, which was discussed by the noble Lord, Lord Geddes, and to which I shall return, the pace of democratisation and its impact, and the appointment of the Governor who will succeed Sir David Wilson.

In our previous debate we discussed human rights in connection with the United Nations. That is highly relevant to this Unstarred Question. It is not surprising that the people of Hong Kong, looking across to the mainland, should be anxious that they will lose the rights and the freedom, guaranteed by their connection with this country, which they have enjoyed. The two main protections of those rights, to which we attach importance, are democracy and the establishment of an independent judiciary—the Court of Final Appeal. Hence, in this general question of the rights of citizens—it is relevant to what the right reverend Prelate said about freedom of religion—those two constitutional protections are very relevant. So also is the Bill of Rights to which the right reverend Prelate referred.

As other noble Lords have said, last September the first 18 members of the Legislative Council were elected and, as was acknowledged by the Foreign Secretary and the noble Earl, Lord Caithness, the elections were a great success. It is the view of many that if what was called the high degree of autonomy is to be assured, as specified in the Sino-British Declaration of 1984, the process of democratisation must not be slowed down. There are obvious pressures for it to be speeded up. But it should certainly not be slowed down. It should be continued on the lines proposed by the noble Lord, Lord Wyatt. Moreover, if it is the case, as the noble Lord, MacLehose, said, that these matters are best left to the people of Hong Kong to decide, how better can they decide them than through elected representatives? Or does he honestly believe that they can decide matters better through unelected representatives chosen by the administration? The answer is self-evident.

It has also been said that the most important thing is that Hong Kong should have stability. Stability is not intrinsically good. One can have bad stability as well as good stability. The governments in Central and Eastern Europe over the past 40 years were extremely stable, or appeared to be. However, one would hardly advocate them as intrinsically desirable.

The second protection against the abuse of power is the establishment of a truly independent judiciary. Hence the importance of the Court of Final Appeal, and the presence of common law judges outside their jurisdiction. There is also the agreement made by the joint liaison group—and I do not pretend that I could mediate between the interpretation of the noble Lord, Lord Geddes, and that of the Legislative Council—which aroused the anxiety of the council because it appeared to say that only one of those judges at each session should be a foreign judge. I do not think that we shall be able to decide tonight who is right. However, I must confess that I find it very odd that members of the Legislative Council should so overwhelmingly interpret the agreement in that way, despite the persuasion of the Government, the presence of the Government's legal officers and, presumably, having every wish not to be alarmed by what had happened, if they were completely wrong.

I should point out that the only document that I have read on the matter is fairly specific in saying that the group also agreed to limit foreign judges to one in each session. I do not know whether that is a false interpretation of the decision. If it is, many people must have been profoundly misled and the agreement reached by the joint liaison group must have been unduly and unnecessarily obscure. That could hardly be desirable in such circumstances.

One would like to know how the Government will react to the anxiety that the agreement has caused. That is what matters. Will they listen to the anxieties expressed by the Legislative Council? Alternatively, do they agree with Mr. Wang, vice president of the China News Agency whose comment, when asked if he would listen to the opinion of the Legislative Council, was: Listen to their opinions? We have already told them our opinions and stance so there is no need to listen".

We have been told that it is unwise to confront the Chinese. However, it is very difficult not to call that statement confrontational. It is a comment that justifies the anxieties of the people in Hong Kong and their need for reassurance. As the right reverend Prelate and other noble Lords have indicated, the Government need to instil confidence in the people of Hong Kong by reassuring them that their rights will not be completely abandoned.

Finally, the council—and this has been referred to by many speakers—attacked the British Government for delay in appointing a new Governor. I hope that the noble Earl will be able to reassure us on the matter. I believe that the noble Lord, Lord Maclehose, said that Sir David Wilson did not look like a lame duck. Well, I do not know what he looked like; but it is a fact that that is generally considered as a misfortune when it happens to politicians who find themselves in such a position. Indeed, it happens to American presidents. No one thinks that it is a desirable situation in which to find oneself. I say that because to make someone in office a lame duck must damage that person's authority, no matter what else is done.

Lord MacLehose of Beoch

My Lords, my point was that Sir David Wilson was standing up frightfully well in the situation.

Lord Bonham-Carter

My Lords, I accept totally the noble Lord's explanation. However, it means that the Government have more explaining to do. I say that because to put someone in a situation in which he has to stand up frightfully well is hardly the way a distinguished public service should operate. I wholly agree with the noble Lord, Lord Wyatt, that the treatment of Sir David Wilson was hardly desirable and that, if his governorship was not to be continued, his successor should have been announced. I hope, in the course of his response, that the noble Earl, Lord Caithness, will be able to provide us with an explanation as regards this unhappy affair.

In the course of the debate anxieties have been expressed which require to be answered. In the years to come, I hope that we shall regularly raise the question of Hong Kong and the importance of our obligations to that colony.

9.13 p.m.

Lord Cledwyn of Penrhos

My Lords, this has been an important and timely debate. We are grateful to the noble Lord, Lord Wyatt, for initiating it and for his opening speech. Although there are a number of critical issues to be resolved in Hong Kong, the noble Lord concentrated upon two of them in his Motion. Like other noble Lords, I shall therefore deal with those issues, although that does not mean that we are not mindful of the other problems which exist there.

The Motion refers, first, to democratic freedom. Noble Lords in excellent speeches effectively analysed that. I agree with the noble Lord, Lord MacLehose, on that. There are, as always, two schools of thought: those who want to proceed rapidly and those who favour cautious progress. Whichever camp we support, we must agree that the elections of 15th September last year were a significant step on the way to democracy. We take elections as a matter of course, but the Chinese Government in Beijing do not. They regard them as a threat to stability. We think of them as essential to stability. Those are points of view which will, I hope, be reconciled over the years. But I feel sure that many of the leaders in China will have thought deeply about developments in Eastern Europe and elsewhere in the world. I believe that their wish is for as amicable a transition as possible in 1997; and, further, that they will observe the letter of agreements that they have signed. They know perfectly well that that has a bearing on their standing in the world.

The September elections, to which all noble Lords have referred, were for 18 members out of the 60 who sit on the Legislative Council. Of those, 12 went to the United Democrats; three others to parties allied to the Democrats; and three to independents whose policies are close to those of the Democrats. I was not surprised by that result, nor by the fact that Mr. Martin Lee emerged as the leader of that group of radical critics. He is an able man of integrity and determination. He polled more votes than any other candidate, and that counts for something. Neither China, nor the Government of Hong Kong, need worry too much about Mr. Lee. They are fortunate to have a man of his calibre in political life. He reminds me a little of Mr. Lloyd George who started in much the same way and ended up as Prime Minister.

What cannot be overlooked is that out of the 3.6 million people entitled to vote, only half registered, and out of those only 39 per cent. voted, which meant a turn-out of less than 20 per cent. of the eligible voters. This country must take some responsibility for that result because we did not encourage the march to democracy in Hong Kong during the long years of government there. Britain did many good things in Hong Kong, but we tended to be democrats at home and plutocrats abroad.

As my noble friend Lord Ennals said, we believe in the steady advance of democracy in Hong Kong. The Sino-British Joint Declaration of 1984 promised Hong Kong "a high degree of autonomy" and there is nothing here which implies that a local democracy should be excluded. China wishes to see a prosperous Hong Kong, which is very much in her interests, and that can best be achieved if there is an efficient local government authority. The Isle of Man may not be a precise model for Hong Kong but there are important lessons to be learnt there and also in the Channel Islands; and His Excellency, the Chinese Ambassador, whom we warmly welcome to this country, might be invited to visit those stable communities which enjoy a high degree of autonomy under the aegis of the British Government.

I think that a little more elasticity in negotiation might be helpful if we are to avoid some years of frustration and disappointment. With other noble Lords, I warmly congratulate Sir David Wilson upon the honour conferred upon him and, like all noble Lords, look forward to seeing him in this House where I know he will make an important contribution. He has had a difficult tenure of office but he has carried out his duties with dignity and common sense, which I know to be true.

Noble Lords have stressed the need to appoint the right successor and there is a good deal of talk about that. What we need is a person with courage, political experience and common sense who can gain the respect of the people of Hong Kong and the Chinese Government; in other words, we are looking for someone very much like Sir David Wilson, because that is what he achieved. Above all, such a man must be given clear guidelines to enable him to do his job properly. We cannot afford to have a loose cannon on the deck in Hong Kong at this time. Whoever he is, I wish him well.

The noble Lord's Motion refers, secondly, to the administration of justice in Hong Kong, and that subject is developing into a conflict of views as the noble Lord and others have described.

The Government, with China and the Hong Kong Government, have agreed on the structure of the Court of Appeal, but on 4th December LEGCO called for the court to be renegotiated. It said the structure compromised the court's independence. As the noble Lord said, the voting was 34 to 11, with 13 abstaining. That has opened a new chapter of suspicion between the Chinese and British Governments. It only goes to show how sensitive is the atmosphere.

As I understand it, the position is that the 1984 Declaration and the Basic Law both provide that Hong Kong's courts shall have, independent judicial power. including that of final adjudication". The argument involving the Joint Liaison Group hinges on how many judges from other common law jurisdictions shall sit on the court.

I have read the speeches on the matter made to LEGCO by the Attorney-General and the Secretary of Constitutional Affairs, and it seems that strenuous efforts will be made to resolve the problem. It appears, however, that the real vote will come in a few weeks when the Hong Kong Government present LEGCO with legislation to set up the court. The proposal in the leading article in a newspaper quoted by the noble Lord, Lord Geddes, also deserves careful consideration.

We shall be glad to hear what the noble Earl has to say about all this. It seems to me that the Hong Kong Administration must get together with the Executive Council and LEGCO to seek to agree on their joint objectives. If this is not done, there could be trouble ahead. The Chinese Government will have more respect for them if they are seen to be united, and the shape and success of the years following 1997 will depend on this. It will also depend on the integrity of the Government of China and their observation of the terms of the agreement and beyond that their tolerance of different traditions, as mentioned by the noble Lord, Lord Derwent.

I was much disturbed by the words of the right reverend Prelate the Bishop of Worcester when he said that the Beijing Government were beginning to harden their attitude to the Church. That would be unfortunate and damaging to our relations and the future of Hong Kong, as well as to the world view of the Chinese Government. We wish to co-operate with China and we hope that nothing will interfere with that objective.

9.21 p.m.

The Earl of Caithness

My Lords, I too am grateful to the noble Lord, Lord Wyatt of Weeford, for raising these important issues which are vital to the future of Hong Kong. I should also like to thank all your Lordships for taking part in this important discussion. I have listened to a wide range of views, as wide a range as I hear in Hong Kong. None of your Lordships will have failed to notice the speeches of those who know Hong Kong well. In particular, I commend the speech of great authority from the former Governor, the noble Lord, Lord MacLehose of Beoch, who spoke about the realism of the Hong Kong people and their links with China.

As I listened to the noble Lord, Lord Wyatt of Weeford, I felt that he was looking at the problem through the wrong end of a telescope. That is unusual for him and not the voice of reason that we have come to expect.

Your Lordships will know that the noble Lord, Lord Wyatt, originally tabled this Question for debate two weeks ago. As I wished to answer it but was due to be in Indo-China at the time, he kindly agreed to change the date. However, your Lordships lost out because although I am grateful to him your Lordships have suffered the loss of the noble Baroness, Lady Dunn, from the original list of speakers. She cannot be with us today, much though she wished it. Her input into the debate would have been most useful.

One of my abiding memories of my visits to Hong Kong is the persuasive arguments put forward for the necessity of good relations between China and Britain, as this would benefit Hong Kong in the period up to and through the transition in 1997. That was a particularly clear message I received from everyone I talked to, especially during my first visit in 1990. Over the past 18 months the Sino-British relationship has improved significantly from a low point and as the noble Lord, Lord Derwent, said in an excellent speech, this has led to significant benefits for Hong Kong. It has done so against the background of the commitment by both sides to implement the Sino-British Joint Declaration signed in 1984 and registered at the United Nations. This sets out the basis agreed between Britain and China for the preservation of Hong Kong's way of life for at least 50 years after sovereignty returns to China in 1997. The implementation of the Joint Declaration is the cornerstone of our policy to ensure the continuing success of Hong Kong.

Nineteen ninety-one was an important and eventful year for Hong Kong. During the first six months tough and protracted negotiations continued with China over Hong Kong's new airport. A good agreement in which the Hong Kong Government were fully involved was eventually reached, and the Prime Minister and the Chinese Premier signed the Memorandum of Understanding in Peking in September. The Hong Kong Government are now pressing ahead with this vital enterprise and tenders for the first main works project, the Lantau Fixed Crossing, will be awarded in the next few months.

On the political side, after elections to the district boards in March and municipal councils in May, the key event was the first direct elections to the Legislative Council (LEGCO) which took place on 15th September. A total of 54 candidates contested 18 seats in a lively and hard fought campaign. The turnout at almost 40 per cent. of registered voters was a record for Hong Kong, although lower than some had predicted. The United Democrats and other Liberals won 16 of the seats, with about 50 per cent. of the votes cast, giving them overall a vote of approximately 10 per cent. of the eligible electorate.

Contrary to the impression given by the noble Lord, Lord Wyatt, the aim of the 1991 election was not to elect a government for Hong Kong, or indeed a majority on EXCO. Both the noble Lord, Lord Ennals, and the noble Lord, Lord Wyatt, are not as well informed as they usually are. It is not a question of not inviting Martin Lee onto EXCO, but rather of Martin Lee indicating clearly that he cannot accept the conventions on confidentiality and corporate responsibility that go with being a member of EXCO. I know that the Hong Kong Government want—

Lord Wyatt of Weeford

My Lords, as I understand the matter, Martin Lee was quite prepared to accept the remit on secrecy. However, he was not prepared to accept the doctrine of collective responsibility, as he thought his party was rather stronger in LEGCO than the unelected governor's nominees.

The Earl of Caithness

My Lords, what one has to understand is there is no government party in Hong Kong. That decision was entirely for Martin Lee to make and he made it.

Lord Ennals

My Lords, I did not say anything about the Executive. I did not say anything about who should be elected or about whether or not Martin Lee should be nominated. I hope the noble Earl will withdraw the accusation he made that I am ill-informed on this matter.

The Earl of Caithness

My Lords, I am most happy to withdraw that accusation. I apologise to the noble Lord if I misunderstood his speech. I shall read his speech with great care when it is printed in the Official Report, as I normally do.

I know the Hong Kong Government want to work closely with all those in LEGCO, and I hope all those in LEGCO want to work closely with the Hong Kong Government. The election marked a significant step forward—as the noble Lord, Lord Cledwyn of Penrhos, remarked—in the development of democracy in Hong Kong. It implemented stage one of the process agreed by Britain, China and the Hong Kong Government. LEGCO now has almost one-third of its members elected by universal suffrage and, for the first time, a majority of the Council consists of elected rather than appointed members. We are well on the way to transforming LEGCO from a wholly appointed body in 1984 to a body after 1997 which, in the words of the Joint Declaration, will be "constituted by elections". That is the strategy, based on the Joint Declaration, that aims to ensure a smooth transition. That is the strategy the noble Lord, Lord Ennals, wants to tear asunder. I must ask the noble Lord what continuity he has proposed for the people of Hong Kong. He has proposed no such continuity.

I know that the noble Lord, Lord Wyatt, takes a personal interest in this important matter of democracy. Our aim is not only to establish in the territory before 1997 a system of government which includes a substantial element of elected democracy but also one that will endure and develop further after 1997. Present arrangements provide for steady progress towards the possibility of eventual full direct elections in line with the Basic Law. As a result of our earlier representations to the Chinese authorities, the Basic Law provides for a progressive increase in directly-elected seats from 20 in 1995, rising to 24 directly-elected seats in 1999 and 30 in 2003, with the option of full direct elections in 2007. In October last year the Hong Kong Government announced a comprehensive review of the electoral legislation and arrangements.

The aim of the review is to examine issues and problems that emerged from the experience of the 1991 elections. The review will be completed in 1992. We shall, in due course, be discussing with the Chinese the arrangements for the next LEGCO elections in 1995 and will continue to press the case for a faster rate of democratisation. The aim should be to agree alterations with China in advance on a subject such as this. This is the only way we can be sure that the Legislative Council elected in 1995 will be able to continue in office through 1997 to 1999. If we increased the number of directly-elected seats unilaterally, the Chinese would certainly regard the resulting LEGCO as incompatible with the Basic Law. In all likelihood they would not therefore allow it to continue after 1997.

Lord Ennals

My Lords, I shall have to ask the noble Earl to give way again. He accused me of having advocated the tearing up of agreements already reached. If he reads my speech carefully he will see that I made no such suggestion. He has just used the words "only changed by agreement". I agree with that absolutely. The noble Earl ought not to be making accusations which are not based on fact.

The Earl of Caithness

My Lords, I shall read the noble Lord's speech in the Official Report. I gained the impression that he did not like the present arrangement and that he was quite happy to tear up those arrangements without putting anything in their place which was not agreed with China. If I am wrong, I am delighted. The noble Lord may have made a slightly different speech from the one I understood him to have made. I certainly interpreted it differently.

The democratic freedoms referred to by the noble Lord, Lord Wyatt, go beyond the question of elections, important though that is. The Joint Declaration expressly provides for Hong Kong's present capitalist and democratic way of life, with all its human rights and freedoms, laws and legal system, to continue for at least 50 years after Hong Kong reverts to Chinese sovereignty. Like the noble Lord, Lord MacLehose of Beoch, I was pleased, incidentally, to see press reports over the weekend quoting Mr. Deng Xiaoping as saying that that guarantee will remain the same for 100 years.

There are many aspects to democratic freedom besides the freedom to vote: freedom of speech, freedom of religion, freedom from arbitrary arrest and imprisonment and freedom from mental or physical ill-treatment, to name just a few of the basic ones. Those have been a feature of life in Hong Kong in the past and under the one country, two system approach set out in the Joint Declaration will continue to be so.

In addition, with our support, the Hong Kong Government have introduced a Bill of Rights which became law on 8th June last year. It reinforces protection of the rights of individual citizens. It gives effect in local law to the International Covenant on Civil and Political Rights (ICCPR) as applied in Hong Kong and makes it justiciable in Hong Kong courts. To ensure consistency some local legislation will need to be amended to a limited degree. The Chinese have expressed reservations about the Bill but we have ensured that it is compatible with the Basic Law.

As so many of your Lordships have said, the judiciary has an important role to play in protecting those rights. The Joint Declaration provided that a Court of Final Appeal, to replace the jurisdiction for Hong Kong of the Privy Council after 1997, should be established in Hong Kong. It is a key element in providing for Hong Kong's continued judicial independence.

The court's establishment could of course have been left until 1997, with the present arrangements for appeals to the Privy Council continuing until then. However, it is the view of the Hong Kong Government, and one which we fully support, that there is considerable advantage in setting up the court before 1997 so that it can establish working practices and gain experience while Hong Kong is still under British administration. It is also crucial that the court is established in accordance with the Basic Law so that it can continue to function without any disruption through 1997.

The noble Lord, Lord Wyatt, appeared to argue that the agreement reached with the Chinese and Joint Liaison Group on the membership of the Court of Final Appeal contravenes the Basic Law and Joint Declaration. Let me make it absolutely clear that we do not accept that view. I am grateful to my noble friend Lord Geddes for his support.

After the most careful consideration we are satisfied that the agreement is consistent with both the Joint Declaration and the Basic Law. Indeed, if we were not we could not possibly have signed the agreement. We do not consider that the wording of the Joint Declaration or the Basic Law gives the court unfettered discretion to invite as many visiting judges as it wishes.

I am aware of the view that the phrase "as required" in paragraph 4 of Section 3 of Annex 1 of the Joint Declaration may be interpreted to mean as the Court of Final Appeal may itself think fit. We disagree. If that had been the intention of the drafters they could have said so. Rather, as the Attorney-General of Hong Kong has pointed out, the Joint Declaration and Basic Law state that the court may "as required" invite such judges. That is clearly intended as an objective test, as the Chinese language text makes clear, depending on the needs of each case.

Some critics have used the argument that Britain and China have stitched up a deal without consulting Hong Kong. They are obviously unaware of the true situation. The agreement reached on the Court of Final Appeal was made with the approval of the Hong Kong Government, their Executive Council and the Hong Kong judiciary.

The legal profession was consulted on the outline proposals for establishing the court in 1987 and in early 1988, before beginning negotiations with the Chinese Government. During the lengthy negotiation process the views of a wide range of people in Hong Kong, including the legal profession, were consulted. Some have argued that the Court of Final Appeal drawn mainly from the existing Court of Appeal in Hong Kong will not have the ability or international repute of the Privy Council.

Clearly a reputation takes time to acquire. That is another argument for the Court of Final Appeal's early establishment. There will be some cases where specific skills or expertise are required which are not available in Hong Kong. That is why provision is made for overseas judges to sit on the Court of Final Appeal. However, it should be noted that in 1990 the percentage of Hong Kong judgments overturned by the Privy Council was much lower than in the case of judgments passed in English courts. That is a good indication of the quality of Hong Kong's judiciary, in which we have full confidence, and there is no soundly based reason for others not to share it.

The noble Lord, Lord Bonham-Carter, will be interested to learn that the Government of Hong Kong are now preparing legislation to establish the Court of Final Appeal in accordance with the agreement reached with the Chinese. That will cover far more than just the membership issue. When it is ready members of the Legislative Council in Hong Kong (and Hong Kong people generally) will have an opportunity to consider the agreement reached with the Chinese in the round. I believe that they will find that it contains satisfactory assurances about the independence of the Hong Kong judiciary after 1997.

I accept that the agreement on the Court of Final Appeal is not ideal. No agreement that is the product of three years' negotiation ever will be. But I hope that members of LEGCO will concentrate on the essential point. So let me make it clear: the choice in practice lies between having a Court of Final Appeal established in Hong Kong well before 1997, on the lines agreed with the Chinese, or having no Court of Final Appeal in Hong Kong before 1997. To reject the legislation will effectively prevent the court's establishment before 1997. That would cause unnecessary uncertainty for Hong Kong's judicial system after 1997.

My noble friend Lord Geddes raised the question of nationality and some very technical points. I can assure him that paragraphs 233 and 234 of the Joint Declaration are still valid. Perhaps he will allow me to write to him on the other points that he raised.

All noble Lords who have spoken in this debate are at one in agreeing that the issues of democracy and the administration of justice are vital to Hong Kong's continued success. I am glad that the noble Lord has given us the opportunity to debate them today. They are part of the much larger task of managing change in Hong Kong so that its development—political, economic and social—can be sustained up to 1997 and beyond. The Joint Declaration is the essential framework for this.

The Hong Kong Government already have a high degree of autonomy in running their own affairs except in the fields of foreign affairs and defence. The Hong Kong Government play a full part in deciding policy on Hong Kong's relations with China, and Hong Kong Government representatives take part in the Sino-British Joint Liaison Group, whose task it is to prepare for the smooth transition in 1997. We maintain the closest contact with the Governor of Hong Kong, who was in London last week. 1, too, look forward to his joining us as a Member of this House; I know that we shall benefit from his great knowledge and experience of Hong Kong. I shall be in Hong Kong for the second time this year next month for an extended visit. Ministers also meet regularly with members of EXCO and LEGCO, making sure that the needs and views of Hong Kong people are fully understood.

In summary, the short answer to the Question of the noble Lord, Lord Wyatt, is: within the parameters in which we work, yes, and so are the Hong Kong Government.

Lord Wyatt of Weeford

My Lords, before he concludes, would the noble Earl care to reconsider the strange statement that there is no government party in LEGCO, in view of the fact that the Government appoint the largest single group of Members plus the Attorney-General, the Financial Secretary and the Chief Executive. To say that there is no government party is mad. Are they appointed to vote against the Government? Does the noble Earl expect them to vote against the Government? Of course he does not.

The Earl of Caithness

My Lords, the Chief Executive is part of the administration of Hong Kong. I fear that the noble Lord has not got his facts quite right on this occasion.

Moreover, the prospects are good, a fact which emerged loud and clear from the very successful conference organised by the Hong Kong Trade Development Council in London last week. We have entered into agreements with China that are binding and which all sides have reconfirmed their commitment to honour. With its buoyant economy, its dynamic people and its prime location at the centre of one of the fastest growing regions on earth, Hong Kong can look forward with confidence to the future.

House adjourned at twenty minutes before 10 o'clock.