Sitting of 17 November 1994

Preamble
The House met at half-past Two o'clock
PRAYERS
[MADAM SPEAKER in the Chair]

Business of the House
2.34 pm
Mrs. Ann Taylor: May I ask the Leader of the House to give us the business for next week?
The Lord President of the Council and Leader of the House of Commons (Mr. Tony Newton): Madam Speaker, as the House is aware, the debate on the Address in reply to the Gracious Speech will be brought to a conclusion on Wednesday 23 November and you have already kindly announced from the Chair the intended subjects of the days' debates in the intervening period.
The business for the three days following the conclusion of the debate on the humble address will be as follows:
THURSDAY 24 NOVEMBER—Motion on standing orders relating to deregulation.
Motion to take note of EC document Nos. 10904/93, 8618/94 and 8037/94 relating to two and three-wheeled vehicles. Details will be given in the Official Report.
Motion on an order relating to the salaries of Ministers, the Leader of the Opposition and Opposition Whips in each House, and the Officers of both Houses.
FRIDAY 25 NOVEMBER—Debate on road safety on a motion for the Adjournment of the House.
MONDAY 28 NOVEMBER—Second Reading of the European Communities (Finance) Bill.
Motion to take note of documents relating to the 1995 budget of the European Communities. Details will be given in the Official Report.
[Thursday 24 November:
Relevant European Community documents: a) 10904/93 Two and Three Wheeled Motor Vehicles, b) 8618/94 Two and Three Wheeled Motor Vehicles, c) 8037/94 Two and Three Wheeled Motor Vehicles; relevant reports of the European Legislation Committee: a) HC 48-vii (1993–94) and HC 48-xvi (1993–94), b) and c) HC 48-xxvii (1993–94)
Monday 28 November:
Relevant European Community documents: a) COM(94)400 1995 Budget, b) 8782/94 1995 Budget, c) 9943/94 Adjustment of the financial perspective with a view to enlargement of the European Union, d) Unnumbered-European Parliament's proposed amendments and modifications to the draft general budget for 1995; relevant reports of the European Legislation Committee: a) HC 48-xxiii (1993–94), b) HC 48-xxvi (1993–94), c) No report, d) No report.
Mrs. Taylor: I thank the Leader of the House for his announcement. I start by expressing concern which is shared by hon. Members on both sides of the House. I hope that it will soon be possible to have a debate on
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implementing the recommendations of the Jopling report. Can the Leader of the House tell us when such a debate might take place?
As the Leader of the House has announced that the Second Reading of the European Communities (Finance) Bill will be on Monday 28 November, will he tell us today whether that vote will be a vote of confidence in the Government? If the Prime Minister loses that vote, will there be a general election?
Mr. Newton: On the first half of the hon. Lady's comments, may I express my thanks to her for continuing to conduct our discussions about Jopling in the same positive and constructive way as the hon. Member for Newcastle upon Tyne, East (Mr. Brown) did in his acting capacity. The hon. Lady and I share hopes about making progress. I cannot give an exact date, but I think she will agree with me—indeed, from her comments it is clear that she agrees with me—that our discussions are moving positively.
On the second issue, my right hon. Friend the Prime Minister made it clear yesterday that the Second Reading of the Bill is in itself an issue of confidence. Both of us have made it clear on several occasions that the consequences of losing on an issue of confidence are clear and well known.
Sir Teddy Taylor: Will the Leader of the House reconsider the decision to hold that debate on 28 November, given that the Court of Auditors report, which is relevant to the Bill, is still not available in the Vote Office, although it was published at a champagne reception on Monday and is available—in the French language only—at Heathrow airport? Will he further give us an assurance that he will reconsider the matter until such time as we have an authoritative statement on whether the statement in The Daily Telegraph that it had a Treasury document which said that the actual figures were four times as great as the Government's is true, untrue or a load of rubbish?
Mr. Newton: On the latter point, I thought that the answer of my right hon. Friend the Prime Minister to the hon. Member for Workington (Mr. Campbell-Savours) yesterday afternoon was absolutely clear and straightforward. Indeed, it was so clear and straightforward that the hon. Gentleman was, for once, left nonplussed.
As for the first part of my hon. Friend's question, I will immediately inquire into what he has said.
Mr. Archy Kirkwood: As there is nothing explicit in the Queen's Speech to deal with the important reforms introduced to cover community care, and as we recognise that some parts of the country, including the Isle of Wight, Devon and Gloucestershire, are experiencing serious difficulties in implementing the new reforms, will the Leader of the House undertake to have a debate in Government time so that those and other areas can confront some of their difficulties and get some answers from the Government about how they might be resolved?
Mr. Newton: My right hon. Friend the Secretary of State for Health has already commented on those matters in various ways. The hon. Gentleman is wrong to say that nothing in the Queen's Speech touches on the issues

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raised by community care. There is a clear-cut proposal for a Bill to deal with supervised discharge in the mental health field.
Mr. David Harris: When can the House expect a debate on the important report by Lord Donaldson, given recent events, especially the Estonia tragedy, and other matters of grave concern where maritime safety is involved?
Mr. Newton: I shall simply undertake to bear my hon. Friend's legitimate concern in mind. I am not in a position to give a date for a debate this afternoon.
Mr. David Winnick: Bearing in mind the fact that next Sunday is the 20th anniversary of the mass murder of 21 people in Birmingham, will the Leader of the House promise that we will be kept fully informed of the peace process? I tabled early-day motion No. 28 on the subject.
[That this House notes that it is 20 years since the mass killings of 21 people in Birmingham as a result of terrorist violence; deplores that such an atrocity occurred and again extends its deepest sympathy to the relatives of those murdered and also to all those injured; and strongly hopes that the present cessation of violence by the paramilitary organisations in Northern Ireland will be permanent and thus ensure that such an atrocity as took place in Birmingham as well as the killings in many other places both in Northern Ireland itself and Great Britain will never occur again.]
Despite what may happen in Dublin, is it not absolutely necessary for the House to be kept informed of what is happening to that process? At the same time, is it not important to ensure that the process is permanent so that never again will people be murdered in any part of the United Kingdom as a result of terrorist violence coming from Northern Ireland?
Mr. Newton: The hon. Gentleman knows well of, and shares, the Government's determination to make progress in the peace process and to bring about the situation that he would like to see. I am sure that my right hon. and learned Friend the Secretary of State for Northern Ireland and my right hon. Friend the Prime Minister will report to the House as they think appropriate. I am also sure that the House will share the hope that political developments in Dublin will not affect the peace process.
Lady Olga Maitland: Will my right hon. Friend consider a debate following the press conference that Gerry Adams gave in the Houses of Parliament today, in which he was extremely evasive about his willingness to co-operate with the British Government on giving up weapons? Does my right hon. Friend agree that a full debate, during which hon. Members on both sides would be very supportive of the importance of banning those weapons, is essential? Otherwise, a cruel trick will have been played on the people of Northern Ireland, who crave permanent peace.
Mr. Newton: Although I understand my hon. Friend's point, she will understand that it is not long since the House had the opportunity to debate Northern Ireland
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matters in the spillover period after the summer recess. I cannot promise a debate in the near future, but I will bear her legitimate request in mind.
Rev. Martin Smyth: Will the Leader of the House make arrangements for a statement to be made next week dealing with recent developments in the study of sudden infant deaths? Will he bear in mind the fact that some of us raised the matter years ago and were told that no dangerous substance was involved, yet scientists had not been given the task of undertaking proper research and, above all, pathologists had not examined the babies' tissues?
Mr. Newton: I cannot promise a statement, but I assure the hon. Gentleman that my right hon. Friend the Secretary of State for Health will study carefully what has been suggested in recent days. I shall draw her attention to his remarks.
Dr. Robert Spink: In view of the deep concern with which my constituents view the plans of the Liberal and Labour-controlled Essex council to sell off part of Hadleigh junior school playing fields, will my right hon. Friend consider a debate in which Government policy on the sale of school playing fields could be brought forward?
Mr. Newton: Although I cannot promise a debate, I am sure that my right hon. and hon. Friends will consider carefully my hon. Friend's remarks. The Government have shown in various ways that they attach considerable importance to sport in schools and want local education authorities—of whatever colour, frankly—to study carefully such proposals against that background.
Mr. D. N. Campbell-Savours: In the light of the fact that Lord Archer—whom I am required to describe as noble—has got away with £80,000 on an insider trading deal, is not it about time that Parliament reconsidered insider trading legislation so that people who commit offences can be charged with them and prosecuted successfully?
Mr. Newton: I do not think that either you, Madam Speaker, or the House would expect me to follow the hon. Gentleman, either in the terms in which he referred to the noble Lord, or in some of the remarks and accusations which followed, and I do not propose to do so.
Mr. Robert Key: I am sure that my right hon. Friend would agree that the success of the national lottery depends crucially on the confidence that the British people have in the method of distribution, particularly of the Millennium Fund. Will he therefore arrange for an early debate so that we can review the progress made so far, and thereafter ensure that we have an annual debate on the national lottery?
Mr. Newton: There is some tension between the point made by the hon. Member for Dewsbury (Mrs. Taylor)—to some assent from the House—about making progress on Jopling, and continual demands for additional debates of one kind or another, whether annual or otherwise. I do not think that I would want to excite too many hopes in

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that direction. I shall, of course, consider whether it will be possible to have a debate on the huge success of the national lottery, and associated matters.
Mr. Nigel Spearing: Will the Leader of the House confirm that the European Communities (Finance) Bill to be debated on Monday week is being promoted under article 201 of the current treaty which gives national parliaments the treaty power to say no if they wish? Is he aware that the report of the Select Committee on European Legislation on Commission proposal 9298/93—the instrument for the new financial structure—noted that the Paymaster General had stated that, in some respects, the proposal did not accord with the agreement at Edinburgh? Will the right hon. Gentleman now assure the House either that it is in the accord, or that the differences will be made clear before the debate on Monday week?
Mr. Newton: I assure the hon. Gentleman that the purpose of the Bill is to implement the Edinburgh accord on European Community finance, and I will draw his comments to the attention of the Paymaster General.
Mr. Nick Hawkins: My right hon. Friend will be aware that many of my constituents work for British Aerospace. He may not be surprised that I am keen to know whether there is likely to be an opportunity for an early debate to consider the competitive position of Britain's defence procurement industry, with particular reference to the two bids received for VSEL. Will there be such an opportunity?
Mr. Newton: There are certainly likely to be early opportunities to raise those matters, which is not quite what my hon. Friend asked for. First, there is a debate embracing defence matters today; secondly, my right hon. and learned Friend the Secretary of State for Defence will be answering questions next Tuesday; and, thirdly, my right hon. Friend the President of the Board of Trade will be answering questions next Wednesday.
Mr. Dennis Skinner: Can the Leader of the House tell us exactly what the Government mean about the debate on the European Community budget a week on Monday in respect of the Government losing the vote? If the vote is lost, will he tell us that the Government will not table a motion of confidence the following day to try to save their bacon? If the Government are saying that a defeat on the European budget proposals is final, that should be the end of it. Will the right hon. Gentleman make it clear that there will not be a vote of confidence the following day?
Mr. Newton: My right hon. Friend the Prime Minister made it crystal clear yesterday that the Bill is seen as an issue of confidence. I have said elsewhere that I do not anticipate that the scenario painted by the hon. Gentleman will be followed by a vote of confidence of the kind to which he refers. I have also made clear elsewhere, as have others, that the normal and natural consequence of losing a vote on an issue of confidence—although these are matters for the Prime Minister and for the monarch—would be that the Prime Minister would ask for a dissolution, and that the Queen would grant it.
Mr. Harry Greenway: May we have a debate next week on the chaotic situation which now
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surrounds the export of live animals for slaughter overseas with a view to having animals properly slaughtered at home and exported on the hook, rather than on the hoof?
Mr. Newton: My hon. Friend, with his persistent and dedicated pursuit of the interests of animals, knows 'well that my right hon. Friend the Minister of Agriculture, Fisheries and Food and, indeed, his predecessors, have persistently fought in Europe for improvements in conditions, and will continue to do so.
Mr. Andrew F. Bennett: Given the enthusiasm of the Leader of the House for Jopling, can he explain why did he not take the opportunity today to announce the business for the next fortnight? That would have been a good precedent to set, especially since we can almost all work it out. Which of the Bills in the Queen's Speech will be subject to the special procedure of the Select Committee so that we can exercise proper scrutiny over them, or does the right hon. Gentleman's interpretation of Jopling simply confer benefits on the Government at the expense of Back Benchers?
Mr. Newton: If the latter were the case I would not have gone to so much trouble to discuss things with the Opposition and with the minority parties—
Mr. Bennett: What about Back Benchers?
Mr. Newton: —seeking to take into account the interests of all in the House. I have repeatedly acknowledged that the interests of hon. Members must be taken into account when considering Jopling.
On the first part of the hon. Gentleman's question, perhaps we had better await the signing, sealing and, I hope, delivering of a complete understanding on Jopling, but I do not think that I would be giving any secrets away if I said that the day immediately following the business that I have announced, Tuesday 29 November, my right hon. and learned Friend the Chancellor of the Exchequer expects to open his Budget.
Mr. Ian Bruce: May I, for probably the first time, endorse the remarks of the hon. Member for Denton and Reddish (Mr. Bennett)? I agree that, at this time of the year, it should be possible to announce the full business for the fortnight and to know the Whip on both sides, so that we know where we are.
What stage have we reached with linking ourselves to the information super-highway? That is another development on which our Parliament seems so far behind the rest of the world.
Mr. Newton: I will draw the latter part of my hon. Friend's question to the attention of the Chairman of the Information Committee—I am happy that it is not my direct responsibility—who shares my hon. Friend's enthusiasm.
On the first half of my hon. Friend's question, since I now seem to be engaged in a peculiarly helpful operation to the House in response to questions, I can say that after my right hon. and learned Friend the Chancellor of the Exchequer has opened his Budget on 29 November there will be a debate on the Budget on the Wednesday and Thursday.
Mr. Derek Enright: The Leader of the House will be aware that the clerk to the Select

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Committee on European Legislation has been allocated extra duties. Will the right hon. Gentleman re-examine this?
Madam Speaker: Order. That is not a matter for the Leader of the House. The hon. Gentleman might like to come to see me about it.
Mr. Enright: I am grateful.
Mr. Newton: I am even more grateful to have you, Madam Speaker, doing the work.
Mr. Toby Jessel: Is my right hon. Friend surprised that no one has yet asked him if we can have a specific debate on the colossal amount of fraud in the European Union? Far from debating whether we should pay increased sums, should we not now be debating whether all cheques to the European Union should be stopped forthwith until it puts its house in order?
Mr. Newton: The question might not have been put in that specific form, but I rather thought that that was what my hon. Friend the Member for Southend, East (Sir T. Taylor) was getting at. Of course, there will be a number of opportunities to debate such matters, which everyone in Her Majesty's Government will welcome, because the United Kingdom Government were at the forefront of instigating the report from the Court of Auditors and pursuing the issue of fraud in the Community.
Dr. Norman A. Godman: Following the question from the hon. Member for St. Ives (Mr. Harris), I, too, demand an early debate on the report of Lord Donaldson, entitled "Safer Ships, Cleaner Seas". It was published in May and the then Secretary of State for Transport promised hon. Members a debate on it this year. The Leader of the House should be aware that many unsafe and uninsured factory ships from eastern European countries, which constitute a serious danger to human life and the marine environment, operate in Scottish waters. We need that debate.
Mr. Newton: I cannot add to what I said to my hon. Friend earlier, although I am aware of the concern about that. Perhaps I should have said earlier, however, that my right hon. Friend the Secretary of State for Transport is due to answer questions next Monday, so the hon. Gentleman may have an opportunity then.
Mr. Anthony Coombs: May I raise the esoteric but important subject of the licensing of herbal medicines, about which I have had a great deal of correspondence recently? Is my right hon. Friend aware that people are concerned that the Government will seek to amend by regulation the Medicines Act 1968 in response to a somewhat ancient EC directive, which will make the licensing of individual herbal medicines prohibitively expensive and thus drive out of business too many practitioners in that growing field of medicine?
Mr. Newton: Of course, I am aware of the concern that has been expressed and have been subject to correspondence on it, as have other hon. Members. As I am sure my hon. Friend is aware, my hon. Friend the Under-Secretary of State for Health made a statement last Friday making it clear that herbal products currently
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exempt from product licensing under section 12 of the Medicines Act will continue to enjoy that exemption under the new legislation that comes into force on 1 January 1995. There was some concern about whether that resolved the question regarding aromatherapy. Those products can be sold without a product licence if they are not medicinal products—that is, if no medicinal claims are made. That will remain the case after 1 January 1995. I hope that my answer reassures both my hon. Friend and those on whose behalf he speaks.
Mr. Eddie Loyden: Will the Leader of the House ask the Secretary of State for Transport to place a copy of the marine accidents investigation branch report in the House of Commons Library? May we have a debate on that important issue in the near future?
Mr. Newton: I shall bring the first question to the attention of my right hon. Friend and consider the second myself.
Mr. George Mudie: Is the Leader of the House aware of the deep disappointment among thousands of people about the lack of a specific reference to the Child Support Agency in the Queen's Speech? Since the Select Committee on Social Security has now reported on the Child Support Agency, which has always been the last excuse by Ministers for delaying action on that matter, when can we expect a debate and legislation on that important item?
Mr. Newton: Of course, I am aware of the concern expressed about the Child Support Agency. The hon. Gentleman will know that we all welcome the Select Committee's full support for the principles behind the child support scheme. My right hon. Friend and other colleagues in the DSS are currently carefully examining what the Select Committee has said and I am sure that they will come forward with a response at the earliest possible moment.
Mr. Andrew Miller: Will the Leader of the House ask his colleagues in the Department of Health to make a statement on the subject of women who have suffered radiation damage as a result of treatment for cervical cancer? Will he ask his hon. Friends to include in that statement the conduct of health authorities which are withholding information from that extremely hard-pressed group on matters that affect their personal health?
Mr. Newton: I shall certainly bring those concerns to the attention of my right hon. Friend.
Mr. Nigel Griffiths: As the Leader of the House is ruling out a statement on cot deaths, will he allow for an early debate on the findings of "The Cook Report" and the failure of the DTI, the Secretary of State for Health and the Chief Medical Officer to take action four years ago on the sale of mattresses that give out toxic gases, which could have avoided possibly hundreds of cot deaths?
Mr. Newton: I hope that any response that I gave earlier was not seen in the dismissive way that the hon. Gentleman implied in his opening remarks. It was certainly not intended like that. I repeat that I am sure that my right hon. Friend and her advisers are looking

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carefully at what has been said and written in recent days, and I shall bring to her attention the hon. Gentleman's remarks as well as the earlier remarks.
Mr. Andrew Mackinlay: May we have an immediate statement from the Attorney-General about his dilatory approach to the extradition of Father Brendan Smyth? Is the Leader of the House aware that, quite apart from what is happening in Dublin, many people are concerned about the stewardship of that matter by the British Attorney-General, who has let down the police, the children abused and their parents? Is it not time that the Attorney-General made a full and frank statement about his sloppy handling of that matter?
Mr. Newton: The House would not expect me to accept the hon. Gentleman's rather extravagant and over-heated language, but I will certainly undertake to bring his remarks to the attention of my right hon. and learned Friend, who, I am sure, will be doing his job with proper diligence in a matter that obviously requires care.
Madam Speaker: I called at least one hon. Member today who came in towards the very end of the Leader's statement. I wish it to be known now, at the beginning of this new Session, as I made it known in the last Session, that it is not my intention to call Members who have not been in their place during an entire statement. Individual Members owe this courtesy to the Minister who is making the statement, and they should be aware that, if they come in late, they cannot expect to catch my eye in future.

Points of Order
3.1 pm
Mr. Andrew Mackinlay: On a point of order, Madam Speaker. May I have your help?
Yesterday, I tabled a number of parliamentary questions in connection with the Attorney-General's conduct of the Brendan Smyth case. I cleared the matter of the sub judice rule with the clerk at the Table Office. There was not a sub judice problem. At 9.45 last night, I tabled an early-day motion about the same matter, and it did not appear on the blues this morning. When I inquired why, I was told that it had been taken back to examine whether it was a matter of sub judice. I reiterate that I had already cleared that, earlier in the day. When I asked with whom the matter of whether there was a problem regarding sub judice had been cleared, I was told that it had been referred to the Attorney-General.
I find that unacceptable and breathtaking, and I would like you to inquire into the matter for me, Madam Speaker.
Madam Speaker: I understand that the hon. Gentleman sought to table his motion yesterday evening, and that the Table Office thought it right to make sure that some of the matters canvassed were not sub judice in the Northern Ireland courts. It was not possible to establish the facts last night, after the law courts had closed. I believe that that is the normal, and obviously the sensible, practice. When the Table Office clerks have to establish facts in matters of this kind, they of course have to consult the courts, and their normal point of contact is the office of the Law Officers of the Crown.
I am glad to be able to tell the hon. Member that his motion has now been cleared, and of course it will be printed tomorrow, but I believe that the hon. Gentleman had a genuine point of order to raise, and I am glad that he has done so.

Orders of the Day
  Debate on the Address

    SECOND DAY
    Order read for resuming adjourned debate on Question,
    That an humble Address be presented to Her Majesty, as follows:—
    Most Gracious Sovereign,
    We, Your Majesty's most dutiful and loyal subjects, the Commons of the United Kingdom of Great Britain and Northern Ireland in Parliament assembled, beg leave to offer our humble thanks to Your Majesty for the Gracious Speech which Your Majesty has addressed to both Houses of Parliament. —[Mr. Dunn.]
    Question again proposed.

    Foreign Affairs and Defence
    3.1 pm
    The Secretary of State for Foreign and Commonwealth Affairs (Mr. Douglas Hurd): The range of British interests in the world is so wide that the holder of my office has a rather hard choice on occasions such as this. He can either scamper hurriedly from subject to subject, country to country, and try to go around the world in 40 minutes, or he can select—and this year I shall select. So I shall not mention, for example, Kashmir, Cyprus, Gibraltar or the Falkland Islands.
    Mr. Dennis Skinner: Pergau.
    Mr. Hurd: I might mention that towards the end.
    All the subjects I mentioned take up much time in the Foreign Office. They are all important. If hon. Members raise those subjects, my right hon. and learned Friend the Secretary of State for Defence will do his best to cover them when he replies to the debate. I know that my right hon. and learned Friend will speak specifically about the peace process in the middle east; he has just returned from that region.
    I start with a subject that is very much in the news today. The House will have heard the news from Dublin that the Taoiseach resigned this morning. I think that it is right to thank Mr. Reynolds for his work in the past three years, and my right hon. Friend the Prime Minister has written to him today. Under his leadership, the Irish Government have established support for the peace process throughout the political spectrum in Ireland.
    We have no doubt that the peace process will continue. It does not depend on any one person, and it has the overwhelming support, not only of both sides of the House, but of the people of Great Britain and of Northern Ireland and those of the Irish Republic. Therefore, we shall press ahead. My right hon. and learned Friend the Secretary of State for Northern Ireland and my right hon. Friend the Prime Minister will press ahead and, as we have already announced, we shall begin exploratory talks with Sinn Fein and loyalist political representatives before the end of the year.
    Bosnia takes up a great deal of the time and emotions of Ministers, the House and many people in many countries. It is reasonable to ask first: what is the British
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    interest in Bosnia? It has three parts. Stability in Europe is essential for our security, so we want to do what we can to bring the war to an end and to prevent it from spreading. Secondly, we want to end suffering and save lives. Thirdly—I emphasise this to the House today—we must not allow the strains created by Bosnia to disrupt the transatlantic partnership. The danger is there for all to see and I shall work with all my energy to prevent such disruption.
    The realities of Bosnia remain as they have been throughout, with one important exception. It remains true—as it has always been true—that the international community will not impose a solution by force. It follows that the fighting will stop when, and not before, the parties fighting are persuaded to stop. What has changed in recent months is the willingness of President Milosevic in Belgrade to accept the plan prepared by the international community and to put pressure on the Bosnian Serbs to do the same. That is an important change, as the House will recognise, and we must put that change to good effect. We must use the machinery at our disposal as effectively as we can. That means using aid, using the United Nations' force to mitigate the suffering and using the contact group of Russia, America, Britain, France and Germany to promote a solution.
    It is still hard to be optimistic about that. The latest outbreaks of fighting have been destructive rather than decisive. The Bosnian Government have attacked, Bosnian Serbs have counter-attacked, and villages have changed hands and been destroyed. There are more blackened ruins and there is more hunger as the third winter of the war approaches. There are more corpses, but there is no outcome. No one has gained and no one will gain a decisive military victory.
    That setback follows a period during which some signs of normal life returned to Bosnia. A year ago, every day 1,500 shells rained down on Sarajevo and every day civilians were killed by snipers. For most of this year, people in Sarajevo have known days on end when there have been no shells and no sniper casualties. Schools have reopened in many parts of Bosnia and more than 90 per cent. of aid convoys now get through—before the ceasefire barely half did so. All that is at risk and now lies in an uneasy balance between peace and war.
    Our aid workers and troops remain hard at work. Our aid workers have used the lull in fighting to restore gas supplies, reconnect 71,000 people to mains water and electricity, and restart medical services. Our troops have rebuilt bridges, reopened roads and defused dozens of small local crises that never reach the newspapers. The aid workers and the soldiers of UNPROFOR perform deeds of quiet heroism every day. They cannot impose peace, but where a fragile peace exists they can soften the suffering. That is why I say that General Rose and all his troops deserve our strongest support. We share his concern about the recent upsurge in fighting. Our troops can stay there doing their job of building peace and saving lives only if they can do so without unacceptable risk—that is a crucial "if" as we have all made clear, repeatedly, to those involved.
    UNPROFOR and our aid workers work to keep people alive and to maintain a fragile peace on the ground. In the contact group we have to work to keep the prospect of peace alive. Only the Bosnian Serbs now block that way to peace as they constitute the only party involved to have rejected our plan. We cannot simply turn off the engines

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    and wait. We have to find additional routes to a settlement, new ways and a wider solution. Tomorrow I shall be discussing with the Russian and French Foreign Ministers how to keep pressing forward. Soon after that I shall talk to the American Secretary of State and the German Foreign Minister. I am sure that only a united effort by the contact group will succeed.
    Meanwhile, we must continue the arms embargo in the Adriatic. There has been much publicity about that operation, which must now adjust to the change in the American role announced last week. But it should remain effective. My right hon. and learned Friend the Minister of State and I listened in Holland on Monday to a careful analysis of this by the new Secretary General of NATO. Having heard that, I am confident that the NATO action can remain effective. We must not inflate what is certainly a difficulty into a disaster for NATO, and we should avoid giving the problem a political weight that it does not deserve.
    Mr. Mike Gapes: Has the Foreign Secretary seen reports in today's The European to the effect that United States military and intelligence personnel are giving assistance to the Bosnian Muslim side in the conflict, at the same time as the Americans are withdrawing intelligence co-operation from Britain and France in the enforcement of the arms embargo in the Adriatic? Will the right hon. Gentleman take this opportunity to condemn that intervention and to make it clear to the American Government that we do not take kindly to the fact that they are making the task of our troops in Bosnia much more dangerous?
    Mr. Hurd: The hon. Gentleman is inadvertently doing precisely what I was warning against. He is taking the fact that two American ships in the Adriatic have had their orders changed and is pushing it forward, quoting reports to which I do not give credence and raising the whole question of future American reliability. That is not justified by what has occurred. If at any time we feel that the risks to our troops become unacceptable, they must be withdrawn; but we do not believe that that is the effect of the change in the instructions to the American ships.
    Mr. Patrick Cormack: Will my right hon. Friend repudiate what the hon. Gentleman has just said? He talked about the Bosnian Muslim side. Will my right hon. Friend make it quite plain that we are talking about the legitimately recognised Government of Bosnia, which is not purely Muslim, and that there would be no fighting now had the Serbs accepted, as the Bosnian Government reluctantly did, the contact group proposals?
    Mr. Hurd: That is right on both points, but I want to return to the general point that I am trying to make, which is fundamental.
    It is the firm belief of the Government—and, I think, of the Opposition—that the Atlantic alliance remains the foundation of our defence and that the presence of the United States in Europe must not be discounted or thrown away. I say that because some commentators, here and even more elsewhere—in Paris, for example—have rushed to rash judgments on this point in the past few days. I do not believe that we should revise those fundamental judgments, which lie at the heart of our foreign policy, because two American ships have altered their duties in the Adriatic. In an age of uncertainty there
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    are still some welcome certainties. One of those is the strength of the NATO alliance, and we must keep it that way.
    Some reference has been made to intelligence and to the role of American officers in headquarters jobs at NATO—for instance, the admiral in charge of this operation. It has been made entirely clear that Admiral Smith will continue to conduct the NATO operation in exactly the same way as before.
    In this context I should like to commend to the House the interesting speech and proposals made by my right hon. and learned Friend the Secretary of State for Defence the night before last, when he spoke to the Pilgrims about forging an Atlantic community.
    There is no contradiction between our commitment to the Atlantic alliance and the new relationship that we are building with Russia. Russia has joined NATO in one of the most important Partnership for Peace projects. In parallel, the partnership and co-operation agreement between Russia and the European Union was signed last June. We consult, in the same spirit, with Russia at the Security Council, the contact group and the G7 summit, and our British relationship with Russia exhibits a new breadth, openness and warmth. We saw that when President Yeltsin was with the Prime Minister at Chequers in September, and I saw it when Her Majesty the Queen visited Moscow and St Petersburg last month, when the Royal Standard dramatically flew over the Kremlin.
    Mr. Christopher Gill: Has my right hon. Friend seen the report by the Frankfurt-based Institute of Soviet Affairs which shows that the institute believes that Russia has 4.8 million men under arms? That is twice the officially recognised number of 2.3 million and even more than the number of men that Russia had under arms at the beginning of the reduction of armed forces in Europe in the late 1980s.
    Mr. Hurd: I have not seen that report, but I shall check it. My hon. Friend's question leads me straight into what I was about to say—that we should not delude ourselves that the new dialogue and openness about which I have spoken will be easy or that Russia's interests will always coincide with ours. We cannot be naive but must be hard-headed about that. When we now meet we do so in the hope of agreeing on solutions and not just, as in the past, as a way of expressing disagreement and accepting it as inevitable.
    Earlier this year I suggested to President Yeltsin in Moscow that underlying our new relationship was the principle of "no vetoes, no surprises". He agreed, and that is how we should continue to operate. One area on which our perceptions have certainly differed is Iraq. When President Saddam Hussein's troops moved south again last month, we sent two naval ships and a battalion of Royal Marines and doubled our deployment of Tornado aircraft in that region. As a result of that and the American action, the threat was again seen off. But it reminded us that we need to be vigilant, to be prepared to deploy troops in the field and to use our influence and authority in the Security Council.
    There is a route for Iraq to return to normality, and it is clearly set out in the Security Council's resolutions. The recognition of Kuwait, which Iraq has just announced, is a step forward, but it is long overdue. However, it is not the only step that is required before sanctions can be lifted. Saddam Hussein, alone in his sumptuous palaces,

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    bears responsibility for the suffering of the Iraqi people. The Security Council has made it quite clear in resolutions 706 and 712 how Saddam Hussein can obtain funds to relieve the suffering of his people through the sale of oil. He has repeatedly refused that help.
    A general point goes to the heart of any sane idea of world order. Under chapter seven of its charter the UN Security Council has the power to pass mandatory resolutions binding all member states. That power should be used sparingly, perhaps more sparingly than in the past. Such resolutions, especially those that apply sanctions and put on embargoes, inevitably cause inconvenience and loss and are unpopular with some member states. That is why they should be a last resort.
    I have mentioned the sanctions against Serbia-Montenegro, which are thoroughly disliked in the Russian Duma. An arms embargo applies to all parties in the former Yugoslavia and, as it applies to the Bosnian Government, it is deeply disliked by most members of the United States Congress. Equally, there are mandatory sanctions against Iraq which Russia and perhaps others would like to see lifted before long. All those matters are for legitimate debate and review. At present I think that those mandatory resolutions continue to be observed by the major powers. However, if member states, and particularly permanent members of the Security Council were to ignore or contravene those mandatory resolutions, others would quickly follow suit. The authority of the Security Council and the United Nations would quickly unravel and our hope for a more orderly world would begin to dissolve. We are all aware of the temptations and pressures not to comply, but it is essential that those temptations and pressures be firmly resisted.
    Mr. Tim Sainsbury: While my right hon. Friend is dealing with issues in the middle east, will he confirm that we also need to be vigilant against international terrorism? Will he also confirm that we will do all that we can, including the use of the mandatory sanctions to which he has referred, to bring pressure to bear on all parties that support international terrorism?
    Mr. Hurd: I gladly confirm that. As I have said in the past, we are particularly concerned about the policies of Iran, and my right hon. Friend knows what we have been trying to do to focus world attention on terrorism. He will not find us lacking in that regard.
    Let me turn to a subject that the House has discussed endlessly, but rightly. The future of Europe is always high on our agenda and there are ups and downs. Some people rejoice in the ups and some in the downs, but we are making progress on the things that matter for Europe and for the entire world open trading system.
    The GATT agreement was a great success. We now need to ratify the agreement and make sure that the World Trade Organisation gets going as a vigorous decision-making body, keeping up the pace of trade liberalisation. I welcome the decision by the European Court of Justice earlier this week, underlining the role of member states in carrying out the GATT agreement. I commend that judgment to those who tend to believe that the European Court always makes its judgments in a centralising direction. Now the European Parliament—and all of us—can get on with ratifying the agreement and so, I hope, will the United States Congress.
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    It has been a good year for enlargement—another of our objectives. The people of Austria, Finland and Sweden have cast their votes and we now hope the Norwegians will vote to walk through the door that is open for them. The door should stay open; we should not behave like nightclub bouncers letting a privileged few slip in and slamming the door on others outside.
    Our association agreements with six central European countries set a course for further expansion and we are encouraging those countries to prepare themselves for membership. We are now beginning to negotiate association agreements with the Baltic states, as they have their place in the European family.
    As expansion to the east and to the south takes place, as my right hon. Friend the Prime Minister pointed out, the European Union must continue to encourage greater flexibility to match the greater diversity of its members. It is not a question of dilution. We need and believe in a strong, confident union which demands adherence to legal obligations, but the European Union must be more sensitive to its internal differences. It is already happening to some extent; we can see it in the principle of subsidiarity that is beginning to take root and increasingly in what some of our partners say. I read the speech by my French colleague Monsieur Juppeé in the French Assembly this week. He said that he was no enthusiast for the concept of the European super-state, however dressed up in federalism.
    I was in the European Parliament in Strasbourg on Tuesday and I was struck by the way in which leaders of both left and right volunteered that there was no real appetite, even there, for an extension of the competencies of the Commission. There will be plenty of argument about the powers of the Parliament, but the idea which used to be orthodox in those circles that the Commission should steadily extend its competencies into areas not now covered by the treaty has reached the high water mark. We have to bring our own ideas and we shall do so.
    Mr. Nigel Spearing: The Foreign Secretary mentioned the treaty and what was outside the treaty—presumably he was referring to the treaty of Rome. Does he agree that title I of the Maastricht treaty gives powers to the Commission to generally supervise and be in a supervisory capacity over both the treaty on European Union and the treaty of Rome?
    Mr. Hurd: The hon. Gentleman knows what actually happens under the second and third pillars and we can go into more detail another time, but it certainly is not supervision by the Commission. They are intergovernmental arrangements. The Commission is present, but it does not have the same powers it has in the Community itself—the first pillar.
    We are working out and will bring forward our own ideas and energy to the work of preparing for the 1996 conference. The House will have many occasions to discuss that. We have a more immediate problem that was raised by my hon. Friend the Member for Twickenham (Mr. Jessel) during the business statement. We need a clear and effective strategy to root out fraud against the Community budget.
    This week the Court of Auditors published a report which highlighted the scale of the problem. It was using for the first time the greater authority which we, the British, insisted it should have and which was put into the Maastricht treaty.

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    It is for the Commission and the European Parliament to tackle fraud effectively. It should be at the top of their agenda, not in some half-baked postscript. Europe can never be healthy, robust or successful if that cancer is not adequately treated. That is why my right hon. and learned Friend the Chancellor of the Exchequer is pressing for better financial procedures, more rigorously applied. It is also why my right hon. and learned Friend the Home Secretary, through the new intergovernmental system, has launched an initiative to ensure that fraud is treated as seriously in other member states as it is in Britain.
    I repeat what I said this week at the European Parliament. I believe that the newly elected Parliament and Commission have the opportunity to prove their energy and clear-sightedness. They should gain a reputation for themselves by cleaning out the stables and insisting that member states do the same.
    Mr. D. N. Campbell-Savours: I remember an occasion in 1981 when my hon. Friend the Member for Blackburn (Mr. Straw), who was then a junior Treasury spokesman, replied to a debate on that very issue. Ministers assured the House that they would deal with the problem of fraud in the Community. That was 13 years ago, and every year since then Ministers have given assurances to Parliament and to the country that something would be done.
    Even people like me—a committed European for more than 35 years—are beginning to question their loyalties because the Government have repeatedly refused to act. Why cannot some changes be introduced in the Community now, so that some form of international police force is given access to each member state to root out fraud in the way the Parliament and the people of this country expect?
    Mr. Hurd: It was precisely in response to the sort of feeling that the hon. Gentleman has expressed that during the Maastricht negotiations the British Government insisted on new powers. That is why we have a report. The treaty came into force last November and it is now for the Commission, the European Parliament and the Finance Ministers to push ahead with implementing that. My right hon. and learned Friend the Home Secretary has tabled a proposal for joint action. The Commission has tabled a proposal for action by itself, which we shall consider sympathetically.
    The hon. Member for Workington (Mr. Campbell-Savours) is right to say that the matter has dragged on for far too long. Now, thanks to this country, there is an opportunity to deal with it effectively, not just through declarations— [Interruption.] The hon. Gentleman and I will exchange further views on this matter in a year's time and then we can see how we are getting on. However, I assure him that we are on his side.
    Sir Ivan Lawrence: Before my right hon. Friend leaves the question of fraud, I remind him that yesterday my right hon. Friend the Prime Minister said, in an otherwise brilliant speech, that we should give greater powers to the Court of Auditors to investigate fraud in the United Kingdom. Is it the Government's policy to allow international investigators to come here and investigate
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    our frauds? Or will that investigation be carried out by our police and our Serious Fraud Office, in the usual, accepted way?
    Mr. Hurd: My hon. and learned Friend asks an important question. To some extent, the responsibility lies with the Commission. It must put its house in order. It has tabled a proposal, which we are studying, that would provide greater efficiency in that process. Of course, the responsibility also lies with member states as 80 per cent. of spending is by them. That is why my right hon. and learned Friend the Home Secretary has tabled a proposal for member states to be compelled to carry out their responsibilities more effectively. Both sides of the issue are important.
    Mr. Skinner: I listened carefully to what the right hon. Gentleman said about the British Government having pushed for the new powers. He said that the system would be cleaned up. Why, then, did the Chancellor of the Exchequer go to an intergovernmental meeting a few weeks ago and vote to write off more than £500 million that the Italians had swindled from the rest of the nation states? The Foreign Secretary talks about a massive clean-up campaign, but the Chancellor of the Exchequer went along with other member states and voted to write off that £500 million, which means that the British taxpayer has to pick up the bill.
    Mr. Hurd: The hon. Gentleman has that example entirely wrong. Let me explain it to him. Everyone recognised that the Italians and the Spaniards had, to put it mildly, over-benefited from the milk quotas. The Commission proposed a fine of 2 billion ecu for the two countries. We thought that that was not enough and we took the matter to court. The compromise that my right hon. and learned Friend accepted means that Italy and Spain will be paying a fine of not 2 billion ecu but 3 billion ecu—1 billion ecu more entirely as a result of the action taken by the British Government. That is not bad. [Interruption.] I hope that when the hon. Gentleman, who is not doing a great deal of listening this afternoon, has studied the figures he will recognise that he was wrong and pay the appropriate compliments to my right hon. and learned Friend on a good success.
    I want now to move on and say just a word about another part of UN work which has not been really noticed since the disasters in Rwanda faded from the television screens. Rwanda has tested the UN system almost to destruction. I do not think that any of us, looking back, can be satisfied with the way in which the international community responded. Action, not hand-wringing, is now needed. We have made our contribution and we continue to do so.
    Our cargo planes were the first to land back in April. Our aid specialists were there on the ground when the refugees started to arrive. Since August, 600 British troops—this has gone almost unnoticed—have been with the UN force in Rwanda. They will be coming home this weekend. I pay tribute to the excellent work that they have done. The media have hardly done them justice. Our soldiers have literally kept the aid effort on the road, carrying out more than 800 repairs on UN vehicles, rebuilding bridges and treating 125,000 people in the field hospital.

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    There are lessons to be learnt from that, and we are trying to learn them. We need to be better equipped to prevent such conflicts. When we cannot do that, we must be better equipped to respond quickly. I put forward some ideas on that to the UN General Assembly in September. We want to work with other members in developing a coherent structure for conflict prevention in Africa. We are following up those ideas with the Organisation of African Unity and we hope to have a meeting in Africa to carry them further fairly soon.
    Mr. Chris Mullin: Will the right hon. Gentleman give way?
    Mr. Hurd: I shall give way to the hon. Gentleman, but I shall not give way again until towards the end of my speech.
    Mr. Mullin: Is not one of the lessons to be learnt that we should not keep selling arms to those tinpot regimes?
    Mr. Hurd: I shall come to that later. I pass over, as Cicero used to say, the hon. Gentleman, one of the most progressive Members of the House, and the way in which, when it suits him, he describes third-world countries as tinpot regimes. Such a patronising attitude causes immense irritation in the countries that used to belong to colonial empires.
    I come now to our own last remaining large colonial territory. Hong Kong will cease to be British in 1997. But the value to the region of Hong Kong's amazing dynamism must continue—and will continue if the transition runs smoothly. There is a huge British stake in the territory—3.5 million British passport holders, 1,000 British companies and investment worth more than £90 billion sterling. But there is more to our responsibility than that. There is the duty to 6 million people in the territory to hand over Hong Kong in a way that preserves their confidence—everyone's confidence—in their territory. We have a duty to the world and to ourselves to achieve the transition in good order.
    The Hong Kong Legislative Council has accepted our view of the right constitutional arrangements for the territory. We now want to turn that page and tackle and resolve the many outstanding questions. We have just had the welcome agreement on financing the new Hong Kong airport, which I have seen being built. It is on time and it is the biggest single engineering project now going ahead in the world. That is an important step. In the months ahead we shall be working for similar progress in other areas. With China, we need to put aside the sensitivities and suspicions of the past and press ahead with practical co-operation.
    I will refer next to the recent High Court decision on the Pergau dam project—which, understandably and rightly, has aroused a certain amount of comment. I will not go over the whole background. [HON. MEMBERS: "Oh."] I am willing to do so, but that would take time, and I would be repeating the evidence that I gave to the Foreign Affairs Committee, by which I stand. The Committee's inquiries, made under the chairmanship of the right hon. Member for Bethnal Green and Stepney (Mr. Shore), went wider than the court judgment. It examined the events of 1988 and the political and commercial background, and the court did none of that.
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    The court was not asked to enter and did not enter into the question of arms sales. I understand that the court had nothing to say on that point. My understanding—and I will explain why it is only an understanding—is that the court has for the first time interpreted the Overseas Development and Co-operation Act 1980 under which the aid programme was given and decided that the Pergau project falls outside it. The court has not yet produced its written judgment. When it does, I shall study it and decide whether to appeal.
    We must decide whether the Overseas Development Administration can live within the new judgment and yet continue to run an aid programme of benefit to this country as well as to the recipients of aid. I am thinking particularly of the aid and trade provision designed by a Labour Government in 1977, to benefit British industry as well as the recipient country. We shall study that point as soon as I receive the court's written judgment. Subject to any appeal—and we can decide on that only when we receive the judgment—we must of course fully comply with the court's judgment. Meanwhile, I have asked the ODA carefully to review all the projects and activities that it funds, to see whether any others approved under our previous understanding of the 1980 Act fall outside the interpretation of that legislation, which was given for the first time last week. I have read newspaper reports of that interpretation and have a transcript, but I do not yet have the full judgment. In a matter of this importance, clearly I need the full judgment before taking a decision.
    Mr. Peter Shore: I understand the Foreign Secretary's difficulties in making too bold a pronouncement at the moment, because he has yet to see the High Court judgment and to decide whether to appeal. However, will the right hon. Gentleman give the House an assurance now that if he accepts that judgment, or if he appeals and loses, any funds already paid to the Pergau project from the ODA's budget will be restored to the ODA, and that any future sums to be credited for the Pergau darn against future ODA budgets will be disallowed and that the ODA will be able to spend as though no commitment to Pergau had been made?
    Mr. Hurd: I will deal with that point in a moment. I may not entirely satisfy the right hon. Gentleman, but I will go as far as I can today. I would prefer to deal with these matters in sequence. I do not intend to evade the right hon. Gentleman's point because it has been made in many places.
    Mr. Ian Bruce: Was Malaysia a signatory to the Rio accord? I believe that the court specifically said that it felt that the way that Malaysia generates electricity is uneconomic, in that it decided to go for hydro-electricity rather than burn fossil fuel. Surely it is strange when a court starts telling countries that they should burn fossil fuel rather than choose clean hydro-electricity.
    Mr. Hurd: My hon. Friend illustrates my difficulty, because I do not think that the court said that. None of the reports that I have read touch on that matter. Judging by some comments, the court commented on arms sales, and on this or that. I must have the considered judgment of the two judges in writing before I can weigh those matters and decide how best to respond.

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    The judgment, in any case, clearly does not lessen British involvement in the Pergau project. The dam is now 75 per cent. complete and it involves some 200 British companies. We have contractual obligations toward the banks financing the project.
    Mr. Harry Greenway: Will my right hon. Friend give way?
    Mr. Hurd: No. I shall make progress, as I have said. What the judgment would mean, if we decided not to appeal, is that the project should not—could not—henceforth be financed from funds voted under the 1980 Act.
    I now come to the point of the right hon. Member for Bethnal Green and Stepney. Until we have received and studied the written judgment and decided for or against an appeal, we cannot decide on the implications for the aid programme of the money already spent on the Pergau project or the funds likely to be required—the right hon. Gentleman's point—from this year to 2006. Again contrary to some press reports, no decision at all has been taken or indeed could be taken on those points, and the House will be informed of a decision when it is taken.
    I shall give the figures, because some reports go well astray. The total cost of support pledged for the project will amount, on the latest calculation, to £216 million; £24 million has been spent in previous financial years, and £11 million has been spent so far this year. A further £11 million is due to be spent before the end of the financial year, but no payments need to be made in the next few weeks. The remainder, which is £170 million, will be spread over the next nine years, with a peak payment of £26 million next year—that is the most in any one year—and the year after. Until the judgment, those were financed out of the aid and trade provision which I have already mentioned. At present, the aid and trade provision runs at £100 million a year, which is between 5 per cent. and 6 per cent. of the total aid budget. It is useful to have those figures on the record, because it puts those large sums in the right perspective.
    There has been some attempt, to which the hon. Member for Livingston (Mr. Cook) has lent his mind and his tongue, to prove a link between aid and defence sales to several countries. I would like to make one point clear. During my time as Foreign and Commonwealth Secretary, I have at no time authorised or been aware of any link between British aid and British defence sales to any country anywhere in the world. I hope that the hon. Gentleman and the House will accept that assurance.
    Of our 10 biggest aid recipients, all are low-income countries, seven in sub-Saharan Africa, and three in Asia. Nearly 80 per cent. of our bilateral British aid to developing countries goes to the poorest among them. Indeed, the OECD, as the hon. Member for Cynon Valley (Mrs. Clwyd) will know, in the recent review of our aid programme, recognised how British aid focuses on the poorest countries—it wishes that there were more of it, but it recognises that what we spend is focused, as it has always been, on the poorest countries. That picture is far removed from the suggestion that our aid flows are determined by prospects of arms sales. It is absurd to maintain that we should not provide aid to poor countries because they buy our arms, or that we should not pursue defence sales in countries where we give aid.
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    There is a certain unreality about some of the discussion. How many employees of British Aerospace, GEC, Rolls-Royce, Racal and other defence exporters would accept losing their jobs for such a specious policy? I wonder what redress those employees would have and what court they would go to for redress for lost employment if the Labour party's policies prevailed in this matter.
    Miss Joan Lestor: I do not want the right hon. Gentleman to lose the point on the Pergau dam. I would like him to be a little more explicit in his answer to my right hon. Friend the Member for Bethnal Green and Stepney (Mr. Shore). The question is very simple. Whether or not the Foreign and Commonwealth Secretary decides to appeal—according to one newspaper report, he said that his instincts are not to appeal, but that is a matter for him—if it is shown that the money was unlawfully used, all that we need to know is that it will go back into the aid budget and that the aid budget will not suffer as a result. Surely the answer can be yes or no.
    Mr. Hurd: No, because the question is hypothetical. No Minister would answer a question of that kind. I have said that there will be no decisions on any of those points, either on past or future spending. We shall have to lake that decision if I decide not to appeal. As soon as that decision is taken, the House will be informed. I shall give way to my hon. Friend the Member for Ealing, North (Mr. Greenway), but I will not give way again.
    Mr. Harry Greenway: Is my right hon. Friend aware that Ultra Electronics in my constituency is typical of many companies in other constituencies which are responsible for selling arms? It sells sonar buoys to many parts of the world. Many of the people employed there are not impressed by people in the Labour party and elsewhere who say that their jobs should be given up. They know that other countries will take over—[HON. MEMBERS: "How?"] By cancellation of arms sales for whatever reasons. Sonar buoys are as much a form of arms as anything else and Opposition Members ought to know that.
    Mr. Hurd: My hon. Friend, not for the first time, puts a note of reality into the debate. Opposition Members are a little silent on the matter. They know that it is not only, or even mainly, Conservative Members of Parliament who represent industrial constituencies who write to us saying, "You must give an export licence to this project because jobs depend on it." There are plenty of examples of that in the files. Nor is it just Labour Members who write in. Westland is an important export contractor. That is why it is necessary for not only the Government but the House as a whole to get the balance right. I shall now explain in the last few minutes of my speech how we seek to get the balance right.
    Mr. Jeremy Corbyn: Will the Secretary of State give way?
    Mr. Hurd: I will not give way any further. The whole House will accept that a balance is needed. We recognise, as the United Nations charter recognises, that countries have a right to self-defence. If a country wishes to defend itself it needs good equipment. A great many British companies supply high-quality defence products. That is the chain of reasoning and it is hard to resist. We need to

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    ensure that when those products are exported, they are sold responsibly. We need to take careful account of the use to which the equipment may be put.
    Mr. Corbyn: I thank the Foreign Secretary for giving way at last. Can he explain why his Government have consistently sanctioned arms sales to Indonesia, ipso facto supporting the invasion and occupation of East Timor and the genocide of 200,000 people in that country? Does he not think that the blood trade of arms to that country has to be stopped?
    Mr. Hurd: The reason why we allow—under certain conditions that I shall come to—export sales to Indonesia is precisely the reason put by the Opposition Front-Bench spokesman for defence, the hon. Member for South Shields (Dr. Clark), who said that he supported the sale of Hawk training aircraft to Indonesia because that country was part of a south Asia security system. The Opposition Front-Bench team, seeking to strike the balance that I am talking about, came down on the same side of that balance as the Government on the point that the hon. Gentleman mentions. They were right to do so.
    Administering the balance is the job of our export licensing system. If we believe that an application raises concern that equipment is likely to be used for internal repression, we will refuse it. If we are not satisfied about the impact of a proposed sale on regional security, we will refuse it. We have also withheld licences on sales which we thought unsuitable or unfit for the economic or technical capacity of the buyer. That is not academic. In seeking the balance, we refused, often, I expect, against representations from Members of Parliament, some 300 export licence applications last year, including riot control equipment where we were concerned that it was likely to be used for internal repression.
    We will not put unnecessary barriers in the way of British companies which responsibly earn revenue and sustain the jobs of the 400,000 people in this country who work in the defence industry, or the approximately 90,000 of those whose jobs depend upon defence sales overseas. We are highly competitive in this field. It comprises only 2.1 per cent. of our total exports. But we are not prepared to dull the competitive edge of that part of our industry to satisfy people who are well-meaning but ill-informed; people who have no responsibility for the prosperity of the British people or for our ability to earn our living in the world.
    As I have tried to show, our outlook on foreign policy is worldwide. That is because the interests that we promote and protect stretch across the world. We rely on exports to supply a quarter of our gross domestic product—more than twice as much proportionately as Japan or the United States. As an investor abroad, we are only just behind those two. As a home for foreign investment, we are second only to the United States. We are a European power with interests that reach far beyond Europe.
    Protecting those interests, which is our daily job, is not done through some grand design or idealistic vision. It is done through hard work and, I hope, accurate perceptions—taking the world as we find it, identifying British assets and those things that we are strong at and
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    setting them to work as effectively as we can, in the interests of prosperity and security for our people and inthe interests of a more stable and prosperous world.
    3.50 pm
    Mr. Robin Cook: There could not be a more appropriate moment for the House to debate foreign affairs than the day after the Gracious Speech, given that they provide most of the text of the speech this year.
    We wholeheartedly agree with many of the objectives set out in the Gracious Speech. We welcome the support that is expressed for the development of political democracy and a multi-racial society in South Africa. Many Opposition Members worked to support the struggle to end apartheid and we share with the Government the objective of building on that victory to provide a stable future for the peoples of South Africa.
    I would also add our voice to the support in the Gracious Speech for the middle east peace process. I hope that, in the year ahead, there will be surer progress towards that peace.
    We shall co-operate, whenever possible, with the Government on developing their agreement with China to secure the long-term future of Hong Kong on the basis of the joint declaration.
    On all those matters, the Opposition share much common ground with the Government on the role that Britain should play in the world.
    I endorse the Foreign Secretary's observations on General Rose and the troops under his command. We fully support their dedication and commitment and appreciate the dangers that they face in Bosnia. We support the commitment in the Gracious Speech to achieving a peaceful settlement in the former Yugoslavia.
    I must enter one word of caution—the terms that may offer the best hope for an immediate ceasefire are not necessarily the best basis for a long-term solution. The conditions under which it may be necessary to obtain a ceasefire may mean the partition of Bosnia. I press the Government to recognise the fact that Britain must observe those United Nations resolutions that call for a long-term solution in Bosnia—a solution that will both recognise refugees' rights to return to the areas from which they have been evicted and respect the integrity of Bosnia's borders. I invite the Government to support any initiative that could restore Bosnia as a multi-ethnic and pluralist society and not to leave it for ever in a European version of apartheid, based on ethnic partition, as we celebrate the decline of apartheid in South Africa.
    I concur with what the Foreign Secretary said about the United States's decision on the arms embargo and the North Atlantic Treaty Organisation. I am sure that NATO will be robust enough to withstand that difficulty. I am sorry that the Foreign Secretary did not focus on where that decision leaves the United Nations. There are clear United Nations resolutions on the matter of the arms embargo on all the countries of the former Yugoslavia. The United States has frequently used the United Nations in ways that have been harmonious with its foreign policy. We have the right to tell the United States that the legitimacy of those resolutions that it wishes to get through the United Nations depend on it in turn observing those UN resolutions with which it might not entirely agree.

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    Each of those issues is very important, but I recognise that the balance of the Gracious Speech, by devoting most of its time and space to the rest of the world and only the minority to Britain, is not a tribute to the importance of world events but an admission that the Government do not have much to offer on domestic issues. It is a further measure of the thinness of the Gracious Speech on domestic issues that what has dominated comment on the Gracious Speech has been the reaction to the European legislation contained within it. Yesterday was our first day back and before we have had a single vote in the new Session, the Prime Minister has named which vote he will regard as a vote of confidence.
    The device may well work, and I rather suspect that the rebels will be dragooned into line. I should not be surprised if that happened, because the threat to call a general election is a very potent weapon with which to threaten Back Benchers since, on the present polls, half of them would lose their seats. The Prime Minister has demonstrated that he does not dare let his own Back Benchers vote on the merits of the issue because his own party is too deeply divided over Europe.
    I am advised that in foreign affairs a more bipartisan tone is required than is customary. I shall endeavour to rise to that unusual demand. May I therefore congratulate the Foreign Secretary on trying to knock some common sense into his party over Europe at the Conservative party conference? He will recall that, in a speech to that conference, he warned the party that
    "we can get just a little high on xenophobia".
    We know who the right hon. Gentleman is worried might get a bit too high on xenophobia for their own, and the party's, health. They are the same people whom the Chancellor this week described as fanatical anti-Europeans—people such as the Secretary of State for Employment, whose speech to the conference did not just get high on xenophobia, it positively turned on the booster rockets and entered the stratosphere.
    Any of our European partners observing the foot-stomping in Bournemouth which greeted the call of the Secretary of State for Employment to "stop the rot" from Brussels is unlikely—I put it diplomatically, as befits this role—to be more favourably disposed to British interests the next time they are negotiating with the Foreign Secretary and his colleagues in Brussels.
    The House will be aware that I come to this brief from the Department of Trade and Industry, and it may therefore be appropriate to put in the context of my experience at the DTI and what I learnt there how I view our relationship to Europe.
    The broad landscape of the development of trade and industry around the world shows that, at the turn of the century, the world will be dominated by three industrial blocs—north America, the European Union and the newly emerging industrialised countries of the far east. It will be a very lonely world for any industrial country trying to survive outside one of those blocs. Europe is the only one to which Britain can realistically belong. The issue is not whether we are in Europe, but what kind of Europe we are going to belong to.
    The Gracious Speech referred—grudgingly, I thought—to the intergovernmental conference which is coming in 1996. Our view is that we should not approach the IGC as something to be feared, whose advent is to be
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    resisted and whose conclusions are to be obstructed. We believe that the IGC should be embraced as an opportunity to open up the agenda of Europe.
    On some of that agenda, we shall have common ground with the Government Front Bench. I am an enthusiastic supporter of the principle of subsidiarity, but I just wish that the Government would practise at home what they preach in Europe. Instead of giving an example of subsidiarity to Europe, Britain provides the example of the most centralised state in Europe. A consistent feature of this Conservative Government has been repeated Bills curbing subsidiarity to local government and, when the Government are resisted, the abolition of some of the powers of local government.
    The Foreign Secretary will have our full support in the task of getting priority for enlargement towards the countries of eastern Europe. The historic challenge that is facing Europe is how we respond to the breakdown of the old order in eastern Europe and how we embrace those nations in a community of the democratic nations of Europe. When the history of this period is written 50 or 100 years from now, I suspect that those who write it will be puzzled by the obsession that western Europe has shown with its own institutions, often to the exclusion of the need to open its doors to the countries of the east.
    On those points, I think that I am on common ground with the Foreign Secretary, but, in the year ahead, two issues are likely to be contentious. First, we are firmly committed to a social dimension to the European Union. That union cannot be a union that offers only tangible benefits to business without improving the standards of the work force of business. That is why we deplore the Government's opt-out from the social chapter. That opt-out has left the Government so isolated in Europe that the only political party that shares their view on the social chapter is the French National Front.
    That opt-out has also left the Government increasingly isolated in Britain. Last week, an event occurred that demonstrated its irrelevance. One of Britain's biggest food companies signed a deal with representatives on behalf of 26,000 members of its work force in eight countries to provide a European works council across Europe. The managing director said:
    "We believe that a workforce that understand the objectives of a business and the pressures are better able to respond appropriately."
    Under the opt-out, that company could have left out its British workers and avoided creating a works council to embrace them. That same managing director said that the company had not done so because that "would be counterproductive". What was that company? It was United Biscuits, which, since 1979, has given £850,00 in donations to the Tory party. [HON. MEMBERS: "Not enough."] At the current going rate that adds up to 425 parliamentary questions, enough to keep us busy during oral questions until christmas. Even that pillar of the Conservative party has come to the conclusion that the opt-out is counter-productive for its company.
    The reality is that major British companies that compete in Europe know that they would not have the slightest difficulty in complying with the terms of the social chapter, because half of them are already observing it punctiliously in their factories across Europe. It is time that those companies' work forces in Britain had the same rights as those enjoyed by their European work forces.

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    The second subject on which we shall continue to press the Government is serious reform of the CAP. Since 1979, the cost of the CAP has more than doubled and the current budget provides for no reduction in spending on the CAP for the planning period of the Commission. It is not just the cost to the taxpayer that matters but the cost to families who pay higher prices for food and the cost to the environment from turning the countryside into prairies to produce food that we cannot eat. The cost to the standing of the European Union also matters, because most of the stories used by its critics to discredit it come from the CAP. That was demonstrated again in this week's report from the Court of Auditors, which detailed the most spectacular example of £1 billion that we gave to grub up vineyards, only to find, at the end of the period of expenditure, that the output of wine is up one fifth.
    Today, the Foreign Secretary welcomed that report, as he did in a speech to the European Parliament on Tuesday. On that occasion, he expressed some satisfaction at the fact that the report had at least revealed the scale of the problem. Unless we are prepared to take action on it, there is not much point in being pleased with a report for that reason.
    I would have more respect for the urging that the Foreign Secretary has given the Commission of the European Parliament to root out the problem if, last year, the Government had not proposed a cut of £31 billion from the CAP budget on anti-fraud measures. Moreover, the Government have still failed to take up the great majority of their share of the funds available from the Commission to combat fraud in Britain. I would have more respect for Government statements on waste in Europe if the Government, during the British presidency, had not agreed that the European Parliament should continue to traipse round three separate sites, at enormous extra cost. Against that background, the brow-beating of many Conservative Members about waste and fraud in Europe sometimes seems to spring less from an enthusiasm for rooting out fraud than from an anxiety to preserve it as a stick with which to beat the European Union.
    Those of us who want Europe to succeed must recognise that our greatest priority must be to eliminate the fraud and waste that lower support for Europe among public opinion.
    Mr. Iain Duncan Smith: We have heard at great length about the CAP, which the hon. Gentleman says is a problem and a disaster. Exactly what different action would the hon. Gentleman take to stop the problem with regard to the CAP?
    Mr. Cook: I have two answers: one for the long term and one for the short term. In the long term, we must review the system by which we guarantee the price at which we shall buy any amount of food that is produced. In the short term, I shall give one clear priority that the Commission should take on board: I see no reason whatever why Europe should provide £1 billion to subsidise tobacco production when every Government in
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    Europe are trying to stamp out tobacco smoking. Nor does it help then to say that the tobacco does not matter too much because it is so bad that nobody can smoke it.
    Mr. Nicholas Budgen: Will the hon. Gentleman give way?
    Mr. Cook: No, I must proceed with my speech.
    The lengthy passage on foreign affairs in the Gracious Speech touched on many parts of the world besides Europe. Given that the subject was on the Foreign Secretary's mind when he was putting the final touches to the draft at the weekend, I was surprised that the Gracious Speech did not mention the Malaysian Pergau dam. However, I welcome the fact that the Foreign Secretary mentioned it in his speech. I must confess that, at one point over the weekend, I was worried that he might follow in the footsteps of his Parliamentary Private Secretary, the hon. Member for Portsmouth, South (Mr. Martin), and disappear before I had had my first debate with him. Indeed, the Foreign Secretary has confided to the BBC that he had thought of resigning when it emerged that payments of aid for the Pergau dam were illegal. But, as is so often the case with the Government these days, he had second thoughts and changed his mind.
    I cannot congratulate the Foreign Secretary on that issue. My best efforts to be bipartisan break down at this point. I concede, however, that he should not be in the dock alone. The deal for which he is left taking the rap was set up by Baroness Thatcher. If it assists the Foreign Secretary, I am happy to add Baroness Thatcher to the charge sheet—and to any other charge sheet that he cares to suggest. That does not let the right hon. Gentleman out of his special share of responsibility for the debacle. The defence that his Department advanced in the court case was that the Foreign Secretary gave his personal authority to the payments for Pergau, so the ODA could not be held to have behaved illegally. If that was his Department's defence, he cannot now escape his personal responsibility for having got it wrong.
    The Foreign Secretary's reaction to the judgment has been one of pained surprise—it never occurred to him that the payments might be illegal. If, during those actions, nobody stopped to ask whether they were illegal, that makes the whole episode worse, not better. It aggravates rather than mitigates the offence.
    Let me rehearse to the House the actions that led to those payments. The Foreign Secretary authorised payments in aid, even after he had been told that the Pergau dam was not a sound economic project. He persisted in those payments after cost overruns in the project greatly increased the degree to which it was unsound. He overrode the views of the ODA accounting officer even when those views were formally recorded. When asked by my predecessor, he was unable to find a single precedent for a Foreign Secretary overriding the formal advice of his accounting officer.
    If we are now told that he did all that without once asking whether it was legal to do so, we have an alarming glimpse into the private arrogance of a Government who have been there for so long that they no longer even ask whether there are limits to their personal authority.
    In the event, the right hon. Gentleman has resolved not to resign. Very well. If he stays, the least that he can do, in the event that he chooses not to challenge the court judgment, is to put right the injustice that he has created.

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    The first step in doing that would be to give an undertaking that he will pay back to the aid budget the money that was illegally taken from it. The second step would be to ensure that never again do payments of aid become entangled with the sale of arms.
    I listened with the greatest of care to what the Foreign Secretary said about arms sales. It might be helpful to the Foreign Secretary if I were to caution him, by reminding him of an event that will occur this year, although it was not mentioned in the Gracious Speech—I well understand that the Government may not be looking forward to it—and that is the publication of the report of the Scott inquiry into arms sales to Iraq. That inquiry was sparked by two discoveries in the wake of the collapse of the trial of the executives of Matrix Churchill. The first was that the Government connived at the sale of British machine tools to Saddam Hussein, in the knowledge that they would be used in building up his armaments industry. The second was that, in 1988, one of the Foreign Secretary's predecessors, Lord Howe, secretly agreed to relax the guidelines on arms exports to Iraq without any statement to Parliament, but, in the same year, made a statement to Parliament in which he publicly and eloquently deplored the use of chemical weapons by the same Iraqi Government to whom we were supplying those machine tools.
    As the Foreign Secretary is aware, I attended several of the sessions of the Scott inquiry. I was impressed by the thoroughness with which Lord Justice Scott explored the issues with his witnesses. I think that it is fair to say that many of those witnesses were also impressed by the thoroughness with which they were explored. I am sure that the Foreign Secretary would not want to appear before a Lord Scott inquiry five years from now, explaining current arms sales.
    The lesson of the Matrix Churchill affair is that the Government must be honest with the House about the criteria on which they decide to grant exports for licence. That is why, if there are to be major arms contracts with Indonesia, the Foreign Secretary owes it to the House to be open with us about the basis on which they are supplied and about the advice that was tendered by the Foreign Office in the discussions about those licences. For example, is the Foreign Office satisfied with the human rights record of Indonesia, and is he entirely satisfied that none of the weapons that we have supplied have been used to enforce aggression and the continued occupation by Indonesia of East Timor?
    Dr. Charles Goodson-Wickes: In the light of those remarks, I should be grateful if the hon. Gentleman would comment on the last Labour Government's point of view when, in April 1978, they authorised the sale of Hawk aircraft to Indonesia. Does he think that the position was any different then from what it is now?
    Mr. Cook: The hon. Gentleman is correct and, as we have had several exchanges about that during Trade and Industry questions, I am familiar with the ground. The hon. Gentleman was perfectly correct in saying that the initial contract for Hawk aircraft was given by the last Labour Government. They were provided as training aircraft, and they were supplied on the clear understanding that they be used as training aircraft. [Interruption.] With respect, at the time, there was no evidence whatever that Hawk aircraft may have been used in East Timor.
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    I see the Foreign Secretary shaking his head. If he has any evidence that Hawk aircraft were used in East Timor in the 1970s, when the last Labour Government were in power, he should share it with the House.
    Dr. Goodson-Wickes rose—
    Mr. Cook: I have already given way to the hon. Gentleman, and I do not intend to do so again.
    The issues now are whether those Hawk aircraft have been used in East Timor, and whether the Foreign Office has any evidence to support that claim. If so, was that reflected in the discussions about the export licences for further contracts?
    Mr. Corbyn: I thank my hon. Friend for giving way. Is he aware that, in August and September this year, two Hawk aircraft were used in bombing missions in the eastern part of East Timor which had been authorised by the Indonesian Government? That is yet another reason why there should be an arms embargo against the Indonesian regime, as long as it perpetrates human rights abuses, and as long as it illegally occupies East Timor. [Interruption.]
    Mr. Cook: I do not understand how Conservative Members found that amusing. I do not understand what is comic about the suggestion that those Hawk aircraft may have been used against a civilian population in East Timor. If that is indeed the case—the Foreign Office will have better information than that available to any of us—it is not a matter for jest and comedy in the House, but a matter for serious condemnation which should be reflected in our future arms exports.
    Sadly, East Timor is only one of 50 areas where there is active conflict. As the Foreign Secretary said, the United Nations is now approaching its 50th year. More demands are now made of it than when it had the energy of youth. In its first 43 years the United Nations mounted 15 peacekeeping operations. In the past six years alone, it has mounted 17 peacekeeping operations—more than in the preceding 43 years. Those 17 peacekeeping operations involve 3,700 British troops in various locations around the world. We salute the courage of those troops and the sacrifices that they are occasionally called on to make.
    The expansion of the peacekeeping role is partly because the cold war has gone and we no longer live in a bi-polar world. That presents us with a positive opportunity for a new international security order in which the world community, not the super-powers, claims the right to police, and accepts the responsibility for policing, the observation of peace between nations. I entirely agree with the Foreign Secretary that, if that opportunity is to be grasped, the United Nations needs to look at some fundamental reforms of its structure and efficiency. If we are to respond to international crises, we must do so in a less ad hoc fashion, in a more professional operation. If the United Nations is to become the fire brigade of the world, it should at least be put on a permanent footing so that the fire engine can be updated every time there is a crisis somewhere around the globe.
    Mr. Robert Hughes: My hon. Friend is right to say that we no longer live in a bi-polar world, but many things that are happening in the world derive exactly from that condition—I think especially of the Republic of Angola. Is my hon. Friend aware that truce talks have yet again broken down and that, having

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    agreed to a proper agreement for the umpteenth time, Mr. Savimbi of UNITA has yet again said that he will not sign? That agreement was sponsored and brokered by the United Nations—is it not time that the United Nations acted strongly and compelled Savimbi to accept it?
    Mr. Cook: My hon. Friend has put on record a concern that I entirely share. It is a matter of great regret and deep frustration that it looked as though Angola might be achieving a peaceful outcome, but it once again appears that it will be plunged into turmoil. My hon. Friend has been helpful because I had intended to turn now to the tragic events in Rwanda, which illustrate the slowness of the international community to respond—a subject on which the Foreign Secretary touched—and, more importantly, the international community's negligence towards crises in the making.
    I acknowledge that Britain has a larger presence in Rwanda than most other countries—a fact in which Britain can take pride—but, as the Foreign Secretary agreed, the response of the international community as a whole is a matter for deep concern. The United Nations has made a commitment that we will deploy 147 human rights monitors in Rwanda—one to each district. That is vital if we are to build confidence among the refugee camps and enable refugees to return in safety. I understand that, as of last week, fewer than 30 human rights monitors were in place. Moreover, those 30 monitors had available to them only six four-by-four vehicles, one of which was donated by Oxfam. I see no reason why the international community should be dependent on charity to carry out a United Nations resolution.
    The remarkable fact about the Rwandan crisis is not the poor nature of the response but the wilful negligence that helped to create the conditions of the crisis. Rwanda is one of the poorest nations, and has one of the densest populations, in the world. In the late 1980s, the price of its coffee halved. The reaction of the International Monetary Fund was to impose a structural adjustment programme on Rwanda which produced a major reduction in public spending, introduced charges for health and education, intensified the poverty of local people and reduced the public support available to help them to alleviate that poverty. After all that, the international community need not feign surprise at the fact that the tension and desperation which followed led to communal violence.
    Rwanda is not exceptional. It is, unfortunately, only too typical of the pressures on sub-Saharan Africa. Here I come to what I thought was the most breathtaking line in the Queen's Speech—the one that said that Her Majesty's Government
    "will maintain a substantial aid programme."
    The Foreign Secretary knows that the aid budget proposes no such thing. Certainly, the Government have a commitment to raise it to 0.7 per cent. of gross national product, but instead of moving towards that target they are steaming steadily away from it. The aid budget reached that percentage of GNP in 1979; it is now down to 0.3 per cent. and still falling.
    The aid budget is frozen in cash terms, which means that it will not maintain its value in real terms. The final footnote to the tragedy of Rwanda is the fact that the
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    Government are budgeting to cut aid to Africa by £60 million over the next three years. We are spending four times that amount to build a darn and flood a valley in Malaysia—at the same time as planning to spend less on piping clean water to the poorest communities in the world. How is it possible to justify such priorities?
    The message from the conflicts born of this poverty is that international security is best built on international solidarity, in which the wealthiest nations help the poorest out of the poverty that breeds conflict. It is in our own interest to do so, because our troops will be called upon to serve to prevent the conflicts.
    Mr. Hurd: The hon. Gentleman is being philosophical and is entirely justified in so doing. If he had looked at Africa 20 years ago he could have argued that a great deal of the suffering was due to poverty. Of course, poverty remains; I just do not agree with his analysis now. The recent troubles of Rwanda, Mozambique, Angola, Somalia and Liberia are not primarily the result of poverty. They are the result of communal tensions and of the breakdown of a civil society. I do not believe that that is essentially the result of poverty or of a deterioration in those countries' standards of living over the past 20 years. The real difficulty that the United Nations faced in Rwanda, in what until recently would have been regarded as a purely internal matter, was how the international community could prevent Hutus from slaughtering Tutsis, or the other way round.
    Mr. Cook: The right hon. Gentleman correctly said that he and I approach these matters from different political philosophies, but I invite him to ask himself a question. If he believes that the violence and disruption in so many parts of Africa originate only from communal tensions and tribal differences, how come the same tribal differences and tensions existed 20 years ago but without the same degree of violence and disruption across the continent? I would also ask him to reflect on the fact that, during the past decade, the African countries that were poor at the start of it have become even poorer. In most of the countries that he mentioned, child mortality has increased, life expectancy declined and participation in education decreased. The Foreign Secretary may shake his head but those are the facts.
    Not surprisingly, given those facts, we find that we are faced with greater violence. Even if there were room for doubt about the causes, surely the wise course for any responsible Government to follow would be to err on the side of that doubt and not risk making the situation worse by cutting our aid programme for Africa.
    Mr. Ray Whitney: Will the hon. Gentleman tell the House by how much a Labour Government, should there ever be one, would increase the overseas aid budget?
    Mr. Cook: The hon. Gentleman need not look to the future: he can look to the past for an answer to that. In a situation of grave difficulty, and without a penny from North sea oil, the last Labour Government increased the proportion of our GNP that went on aid. Since then, the Conservatives have drunk the North sea oil revenues but have cut the amount of aid. Our commitment is perfectly plain. We shall seek to resume the work that was being

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    carried out by that previous Labour Government and make progress towards the target of 0.7 per cent., as resources permit.
    Mr. Jacques Arnold: Will the hon. Gentleman give way?
    Mr. Cook: No; I have given way for the last time.
    I was saying when the Foreign Secretary disagreed with me that international security is best based on international solidarity. Before concluding my speech I should like to put one other thought to the Foreign Secretary, and it is my reason for believing that international solidarity is in our interests. The pressures of poverty are eroding the environment of the third world. Because we share a single globe, that damage threatens the climate on which we depend for our standard of living.
    Increasingly, security, trade and the environment are making us all members of an interdependent world community. In the year ahead, we shall judge the Government's foreign policy to see whether it strengthens our ability to put into the world community measures that would establish international security. We shall judge whether it gives expression to the international solidarity that a responsible and still relatively affluent nation owes to the world's weaker members. When the Government's foreign policy passes that test we shall support them during whatever period they manage to stay in office. When their policies fail that test we shall expose and challenge those failings until we manage to put the Government out of office and give Britain a Government who will introduce a Queen's Speech that will be full, decisive and based on our values of social justice at home and our commitment to international security and solidarity abroad.
    4.26 pm
    Mr. John Patten: I should like to examine the Gracious Speech in relation to the two classical Tory themes of continuity and momentum. Queen's Speeches are rather like the trains by which one is threatened at French level crossings where one is informed by notices that another train will be along in a hit. Another Queen's Speech is always being prepared as soon as the Gracious Speech of a new Parliament has been produced. I have listened to 15 such speeches, some of which have added to the momentum of Conservative government while others have added to its consolidation and continuity.
    I should like to examine the Gracious Speech in relation to, first, the constitution; secondly, Europe; thirdly, privatisation; and, fourthly, the new civic and community agenda which may dominate British politics for the next 15 years just as surely as privatisation and other issues have dominated it for the past 15 years.
    I rejoice at the fact that the Gracious Speech does not mention major constitutional change, to which the Leader of the Opposition has already so wedded his party. If he ever has the opportunity, he will rue the day that he allows a future Labour Administration to become mired in the depths of constitutional reform. The people of this country do not wish to alienate any part of our sovereign territory. As the last general election showed, people do not want major devolution for Scotland or Wales. Certainly, people do not wish to have any of the crackpot schemes for regional government that have been suggested by Labour
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    Front-Bench speakers. Such schemes would be not only costly but would make Britain one of the most over-governed and over-administered countries on earth. Over the past 15 years, I have been pleased to note that no Queen's Speech has referred to major constitutional innovation. I hope that that will continue for the next 15 years of Conservative administration.
    The second issue is that of Europe. My right hon. Friend the Foreign Secretary knows that I am pleased when one of Europe's ups, rather than one of its downs, is raised here or in the media. The whole House is aware that I speak from that standpoint. I certainly give my wholehearted support to the European finance measure in the Gracious Speech.
    I am concerned, as is the whole House, about fraud. There is no need for me to speak at any great length about the problems presented by mass fraud in the countries of the European Union. They have been discussed quite enough in recent days and they do not need elaboration from me. Action has been taken, much of it encouraged by the Government, and I congratulate them on what they have done. However, I am saddened by the lack of apparent concern shown by the German presidency about fraud.
    The German presidency should have reacted very quickly indeed in the past two or three days and promoted the calling of a special council at ministerial level—possibly the highest ministerial level of all—to show the people of Europe that when their money is used for European purposes, it is done in as straightforward and honest a way as possible.
    I am sorry that the German presidency has not taken that action and I urge my right hon. Friend the Foreign Secretary to consider applying to the German presidency, under the emergency procedures that are available, for a European ministerial council to be held as quickly as possible to demonstrate that action will be taken over the issue of fraud. We do not need cries of initiatives or new stunts to get Europe off the hook; we need action to show that, at the highest level, European Heads of State—and, if necessary, Heads of Government—are sufficiently concerned about the issue to make it a top priority.
    I urge on my right hon. Friend speedy consideration of that possibility. I fear that, as such matters are played back into the new Commission and, as my right hon. Friend said, we all travel carefully and hopefully in respect of the new Commission and the European Parliament, the issue of fraud will get lost in the undergrowth again. It will be there in the shrubbery and, once it leaves media interest, will not receive as close an examination as it should.
    Mr. Duncan Smith: Will my right hon. Friend give way?
    Mr. Patten: I give way to my hon. Friend, but I remind him that I am just a simple Back Bencher and cannot answer on behalf of the Front Bench.
    Mr. Duncan Smith: I am grateful to my right hon. Friend and welcome him to the debate. He is certainly not a simple Back Bencher, although he is a Back Bencher. Does he agree that one of the problems of the German presidency in this context, as he so ably pointed out. Is

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    the current German obsession with further and deeper political union at the cost of all else? Does he agree that that is one of the big problems that has been missed?
    Mr. Patten: My right hon. Friend the Member for Watford (Mr. Garel-Jones), who has come to sit at my feet, muttered sotto voce that it has always been in the treaty of Rome. When one reads such treaties, one finds that we are signed up to all sorts of things that my hon. Friend might not actually like.
    I am about to turn to exactly those points which my hon. Friend asked me to address. It is my belief that the European contributions measure will lead to money from British taxpayers funding European matters. I am one of those who is happy when Europe goes through its up, rather than its down, periods. Therefore, part of our contribution will be funding the activities which lead us into intergovernmental conferences in 1996. As I am happy to inform the House, in the first half of the year the Italians will be in the presidential seat and in the second half there will be the Irish, so 1996 will be an interesting year.
    Much of the debate on the measure will quite properly flow around preparatory measures and positions being taken by different countries in the run-up to the IGCs. I urge my right hon. Friend the Foreign Secretary and his right hon. Friends to ensure that the British voice is strongly heard in the composition of that agenda.
    We are major players in Europe; we are at its heart. We must be major players in proposing the agenda for the intergovernmental conferences in 1996. Above all, we should not allow them to be inward looking and concerned with further and further harmonisation within a Europe that is moving unsteadily in that direction; for example, Europe has the highest non-wage labour costs of any part of the globe.
    As anyone who travels in the far east—as I have done on a number of occasions—will know, the killer economies there are moving at such a rate that they are likely to threaten the economic and social stability of the European Union and that of our friends across the north Atlantic before the decade is over. Therefore, it is critical that my right hon. Friend encourages such discussion as there is to be outward, not inward, looking.
    My right hon. and learned Friend the Secretary of State for Defence made an interesting speech recently, which was reported on the radio. He called for a warming of the north Atlantic link. I am a great admirer of the North Atlantic Treaty Organisation, but such is the economic threat—I do not use that word idly—from the far east that the European Union may have to consider a much closer relationship with the North American Free Trade Agreement countries. They are the United States and Canada, which have recently been joined by Mexico, and will doubtless be joined by further countries. We all know about NATO and we will need it in future, but we must also properly consider the North Atlantic Economic Organisation, which could well bring together the two powerful trading blocs. We will debate such matters in the House in the run-up to the IGCs.
    It is important that we ensure that Europe considers the major constitutional issues within the European Union. My right hon. Friend the Foreign Secretary said that his colleague Mr. Juppé had said that he was lukewarm—or
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    some such phrase—about the possibility of a European super-state. My right hon. Friend suggested, both in the way that he spoke and through his body language—or as much of it as I could observe from behind him—that he was at one with Mr. Juppé. If so, let that be a key constitutional strand in the debates running up to the IGCs.
    We need to be clear about the role and relations of the European Union and individual sovereign states. Ideas cannot easily be bucked at this stage. These are difficult questions to ask, but I am the first to admit that they are much more difficult to answer. Nevertheless, we must finally decide what are the role and relations of the sovereign states and the European Union. Is the Commission a government or is it a servant of governments? Those are major issues that, notwithstanding our treaty obligations, we have not dealt with as the Twelve, let alone as a future Sixteen or Twenty-two. We must ensure that we have a European Union working in the way that I profoundly wish it to work.
    There are interesting times ahead and I believe that 1996 will be a defining moment in the history of Europe. I also believe that it will be a defining moment in the European issue within the United Kingdom. Therefore, it demands the most careful, cautious and deeply thoughtful approach from those of us who support the Government, as I do, to ensure that the issues are addressed as properly as they can be during the next two years.
    I want now to deal with the agenda for privatisation contained in the Gracious Speech. Gracious Speeches come and go and agendas begin. We still have a long way to go with privatisation. I have made inquiries at the Treasury and it appears that we still own 40 or more state industries and corporations. That is wrong. The best people to run businesses are businesses. Government have no business to be in the business of running businesses, although we must run our business as a state in as businesslike a way as possible. As a Conservative party, we should make it a policy aim to ensure that by the end of—let us be generous—1999, the end of the century, we have sold and returned to the private sector all those things that can be sold and returned to the private sector, so that we have a clean slate with which to begin the new century and to tackle the new agendas that are coming to the fore.
    Mr. Paul Flynn: Does the right hon. Gentleman agree that the Government have concluded that some things are unprivatisable? Can he explain why in the Queen's Speech there were no measures to privatise either the Post Office or the Vehicle Inspectorate?
    Mr. Patten: As I said earlier, I am just a simple Back Bencher, squire. Those questions will have to be put to those on the Front Bench.
    I would wish by 1999 to have cleared the board of everything we own that the Government can usefully get rid of, because ownership can sometimes clutter up Government activities. Again and again, ownership has been proven to be much better in private hands. Just look at the benefits of 15 years of Conservative Government in conveying ownership to council house tenants of their houses or flats, or to those who have bought shares for the first time.

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    Lastly, the new agenda of British politics in the next 15 years of Conservative Government will be to complete, of course, a number of those things that we have started, such as the privatisation programme, but also to begin a whole process of trying, just as we have given ownership to the British people, to persuade the British people to take more responsibility.
    I remember my right hon. Friend the Foreign Secretary, as Home Secretary, coining that excellent phrase "the active citizen", which was all about the taking of greater responsibility by people in our community. We are on the eve of developing a form of civic Conservatism which will begin the process of disseminating power. We have seen only a few footsteps in that direction so far—health service reforms, the giving of power to grant-maintained schools with governors made up of parents, local people, business people and teachers. We have only begun that process.
    The Labour party talks a lot about community. We all know what it means by community. It means the reinvention of local government by other means and the giving of power to those people who used to run communities so that they can do so again. On the radio this week, we heard that the Isle of Wight county council, which I guess is Liberal controlled, cannot run its care in the community programme. The immemorial cry of a county council in trouble, one which cannot do its job properly, is that it does not have enough resources—that is, that it does not have enough money.
    Why have we not gone a step further than we have in the past? The Queen's Speech does not take us down this path. For many years, we have had housing associations to bring together fruitfully that combination of public and private money and public, private and voluntary sector endeavour, to provide social housing for people in need who need to rent. Why do we not have care associations which take over the provision of care in the community from those county councils that cannot provide it properly? Those are the sort of ideas that are not yet reflected in the further dissemination of power.
    Mr. John McWilliam: Will the right hon. Gentleman give way?
    Mr. Patten: I see that I have over-excited the hon. Gentleman, so I had better give way.
    Mr. McWilliam: Is the kind of caring Conservative-controlled council that the right hon. Gentleman is thinking of for the future to be more on the model of Westminster city council?
    Mr. Patten: I long enjoyed the excellent services of Conservative-controlled Westminster city council at one end of my life, as I have enjoyed the excellent services of Conservative-controlled councils in Oxfordshire at the other end of my life. I am pleased to have given way to the hon. Gentleman and to have endorsed Westminster city council as an excellent council.
    Dr. Goodson-Wickes: Will my right hon. Friend give way?
    Mr. Patten: I like Wimbledon council, too.
    Dr. Goodson-Wickes: I hope that my right hon. Friend does not, because, unfortunately, it is temporarily under Labour control.
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    My right hon. Friend will remember that he and I joined common cause in the past in promoting the concept of active citizenship. I welcome what he has said today. Linking that with what he said about care in the community, would he welcome opportunities for private sector companies to deliver community care in an efficient and caring manner?
    Mr. Patten: Yes, of course. Again and again, the private sector has worked its magic in enhancing provision funded by the state at a higher level than could otherwise have been provided.
    It is on that note that I end. Agendas change. There is continuity and change in the Queen's Speech. I hope that there will be continuity and further change in future Conservative Queen's Speeches. In examining why we should not have constitutional legislation, why we should be cautious about what we do in Europe, why we should drive on with privatisation and why we should think of new frontiers in order to transfer responsibility, as well as ownership, back to our citizens through the concept of a more civic Conservatism, I have tried to consider how those changes can carry us through the next 15 years. Above all else, it is critical to set out clearly each of the strands of Conservative thought and to show that the plan is there for the next 15 years, just as there was a plan which has carried us so successfully through the past: 15 years. My right hon. and hon. Friends have my strongest support.
    4.46 pm
    Sir David Steel: We do not often have the chance in the House to debate foreign affairs, so I hope that the right hon. Member for Oxford, West and Abingdon (Mr. Patten) will forgive me if I do not follow him down the interesting highways and byways of a simple Back Bencher.
    I want to return to the main theme of the debate, which is the broad sweep of world affairs and, faced with the same problems that everyone else faces of a miscellaneous ragbag of points, I want to try to set what I have to say about one or two particular instances of our relations in the general context of the plea that the Government have made from time to time, but not strongly enough, for the spread of good governance.
    I define good governance as having four component parts. First, we should encourage the promotion of free and fair elections, for the simple and obvious reason that one can search the human history book in vain to find any example of where two democracies have gone to war. There is no greater assurance of the promotion of peace than the promotion of genuine democratic traditions, in countries around the world.
    Secondly, another cornerstone of good governance is accountable and transparent government. At a time when we are talking about corruption, whether it be in the European Community, where we call it fraud, or whether it be the misuse of some of our aid programmes, the only way to root out corruption is to establish accountable and transparent government.
    I came across one example on my travels during the summer recess when I was astonished to be shown the new palace in Lilongwe which was built by Dr. Banda before he was removed from office and which cost $70 million. The scale and extravagance of that would have been horrendous in any country, but in one as poor as

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    Malawi it was a scandal. It was robbery of Dr. Banda's own people and it makes doubtful some of the United Kingdom aid programmes to Malawi when such gross misuse of funds was going on. It is a great tribute to the new democratically elected president of Malawi, President Muluzi, that he has declined to take up residence in such an absurd place.
    Thirdly, in the quadrangle that creates good governance there is freedom of expression and association, including freedom of the press and, fourthly, independence of the judiciary and access to a genuine legal system. Those are the values that we should be attempting to promote as part of our foreign policy.
    In particular, I welcome the speech on that theme made by Baroness Chalker at Chatham house in July when she talked about putting policy into practice. My only criticism of Government foreign policy is that that high priority has not been reflected right across the board—not just in the Foreign Office but in the Department of Trade and Industry, the Ministry of Defence and aid programmes. I add to the pleas made during the Foreign Secretary's speech. Regardless of his consideration of the legal judgment in the Pergau dam case—I am concerned not so much about the legalities as about the political mistakes that were made in that instance—I hope that the £216 million earmarked for that project will be reinstated in the aid programme.
    It has sometimes been said in the House and elsewhere that the standards that I outlined are western standards and that we cannot expect people in Asia or Africa to aspire to them. That is a racist approach to international politics—and when it is said by people who are themselves Asian or African politicians, it is positively insulting. If, as the Gracious Speech repeats, we are committed to upholding human rights, we must accept that torture hurts just as badly whether one's skin is white, black, brown or yellow. We should not accept in any part of the world any departure from aiming at high standards.
    I pay tribute to the work done in that sphere by the Westminster Foundation—a new and small organisation which is inadequately funded compared with the munificence of German political foundations or the American Endowment for Democracy. Nevertheless, the foundation has made a good start. One sees from its annual report that, even with a small budget, it is playing a part in promoting good governance. I only make a plea in the direction of the Treasury that its work should continue to be enhanced.
    I am a little concerned that the Gracious Speech refers to celebrating the 50th anniversary of the United Nations. I hope that we shall do more than simply wave flags or hold meetings or church services. The UN's 50th anniversary is a time to pursue some of the ideas proposed by the Foreign Secretary in the past, and to adopt the proposals made by the UN Secretary-General in his document "Agenda for Peace". We should recognise that a UN charter drafted in the circumstances of 1945 is not really appropriate in the circumstances of 1995. We want the charter revised, more relevant structures and a more streamlined organisation.
    I join hon. Members who referred to the UN's peacekeeping role and to the way in which, sadly, we are often too late on the scene. I saw that for myself graphically in Rwanda in July, when I found myself
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    sitting in the limited office then available in Kigali to Ambassador Khan and to General Dallaire. It was sad to note the length of time taken to provide the 5,000 troops promised by the Security Council. A chart on the wall showed each of the countries from which the contingents were to come. When I was there, the number arriving was 900 out of 5,000 promised. I asked the general when he needed the troops, to which he gave the political response, "Yesterday." As we know, the tragedy unfolded and the troops were late in arriving.
    I add to the tributes already paid to the British forces in Rwanda, who in July had just arrived and were settling in. It is a magnificent operation, but it is sad that it was so late. Will the Government support the initiative taken by the Dutch Government in the Security Council, to press for a standing rapid deployment force? It is not suggested that armed troops should be on standby in Geneva or New York, but there is a realistic proposal to have forces assigned by member nations ready to be moved as a fire-fighting expedition as and when required.
    I am concerned that, with the end of the bi-polar world to which reference has been made, there has been a tendency recently in Washington to regard the interests of the UN and of the United States as one and the same. In Somalia and in the recent decision concerning arms for Bosnia, we have seen the continued erratic nature of United States foreign policy, which may get worse with the recent reverses in the American elections. It will be even more difficult to achieve a coherent United States foreign policy when the Government no longer carry a majority in Congress.
    British foreign policy should be directed more through the European Union, as foreshadowed in a recent speech by the Foreign Secretary and in the Maastricht treaty. We look forward to much greater cohesion in defence and foreign policy in the European Union.
    One area of further development in the UN is the recently created UN register of the arms trade. At present, it is only a register and not fully effective, but it has been established only two or three years. I hope that in future it will become an instrument of international arms control.
    Although people complain with some justification about the degree of bureaucracy in various UN agencies, it is as well to remind ourselves that the UN's annual running budget is only one quarter that of the debt that Mr. Robert Maxwell left behind when he died, which gives a sense of perspective. It is money well spent if we can make the United Nations a much more effective instrument of international policy than at present.
    Dr. Robert Spink: Does the right hon. Gentleman believe that now that UNESCO has cleaned up its act administratively, we should rejoin it? If so, should we do so before America rejoins or after?
    Sir David Steel: Yes, I hope that we rejoin UNESCO.
    The Government recently received formal proposals from the Swedish Government for the creation of an international institute for democracy and electoral assistance, which has the UN's blessing but will not be another UN international agency. It will be established by international treaty next year. Although officials from the Overseas Development Administration have been engaged in preparatory discussions, the Government have yet to

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    make a commitment. I believe that that useful proposal will help us in spreading the mechanics of democracy around the world.
    In the context of the wider view of foreign policy that Britain should be pursuing, I must mention our relations with one or two specific countries. I start, as did the Foreign Secretary, with the current state of affairs in Iraq. I visited that country in the summer with the Bishop of Leicester, at the request of some Iraqi citizens living in this country, to assess the present scale of suffering of the Iraqi people as a result of the protracted dispute following the Gulf war and the impact of sanctions.
    I believe that we would not have made the progress that we have made with Iraq had it not been for international pressure. I am not suggesting that international pressure should have been any less. However, the Americans in particular are in danger of obfuscating two entirely separate issues in the UN Security Council resolutions. The first dealt with the oil embargo and related specifically to weapons of mass destruction and efforts made by the United Nations commission under Rolf Ekeus to establish monitoring machinery in Iraq.
    Slowly and painfully, progress has been made. The commission has reported that all verification procedures are now in place, but we must wait some time to see if they work. That issue should be treated separately from the wider question of sanctions, which relates to issues such as recognition of Kuwait compensation and missing persons. I am glad that there has been progress with those issues too, even within the last couple of days. The Iraqi Government—admittedly, four years after the end of the Gulf war—have recognised the state of Kuwait, its boundaries and territorial integrity. It is necessary to recognise that, because of the effect of the Saddam regime in Iraq, there is real human suffering in that territory. We did not just go on a Cook's tour organised by the Government. We made our own inquiries, met the aid agencies and went to places without the Government's foreknowledge. The scale of human suffering in terms of the lack of medicines and food is very genuine.
    The Foreign and Commonwealth Secretary cited the text of the resolution which enables Iraq to sell some oil, but it is necessary not to stick by all the detailed regulations which were contained in the final proposal of the United Nations Security Council, because there is no doubt that the bureaucracy involved is a clear transgression of national sovereignty. We should enter into dialogue with the Iraqi Government to make sure that the people of that country do not continue to suffer.
    I have suggested, for example, that, on the issue of the Kuwaiti missing persons, if the Iraqi Government really believe what they say—that they have no Kuwaiti prisoners still in their prisons—they should open the prisons to inspection by the International Committee of the Red Cross. Such positive suggestions could be pushed forward, but it is difficult to do so while we have no diplomatic representation in Iraq. Fundamentally, I am arguing for a bit of carrot as well as a bit of stick in dealing with the Saddam regime, in the interests of the people there.
    I now refer briefly to Hong Kong. The Foreign and Commonwealth Secretary mentioned that we were about to undertake a most extraordinary step—the transfer of 6 million people for whom we have been responsible into the hands of what is fundamentally a very autocratic regime which certainly does not meet any of the standard
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    that I have set out. So be it; that will happen. We used to have an annual debate on Hong Kong, yet we have not even got around to debating the Select Committee on Foreign Affairs report on Hong Kong now that we have reached this delicate stage. We should have a debate on Hong Kong very soon.
    It is undoubtedly the case—it is the Governor's own view—that we were very late in paying attention to the development of democracy in Hong Kong, but, now that we have done it, it is regrettable that we have shackled Hong Kong with the commitment in the basic law not to have political ties with the outside world. If we are really to have two systems in one country—one democratic and one in accordance with the wishes of the People's Republic of China—it is right that people in Hong Kong should be free to associate with international political movements, be they Socialist International, Christian Democrat International, or Liberal International in our case.
    In the meantime, while we are still responsible for the government of Hong Kong, I make one plea: we should devote as much attention as we can during our remaining tenure of Hong Kong to improving the environment. I remember when I first went there back in 1965 or 1966 as a very new Member of Parliament. I was rather shaken by the poor standard of the housing that we were building in our own colony. It has improved over the years, but it is undeniable that, over the decades, we have been rather negligent as a colonial administration in dealing with the problems of the environment and of pollution. The problem is now becoming very serious in Hong Kong, and not just aesthetically; it is beginning to pollute marine life, to the possible danger of the human beings who consume it. That issue should receive much greater attention as we come to the end of our period of tenure.
    Let me refer next to Kenya. I do so because President Moi is visiting this country. If we consider the four standards that I have set out, we must say that, at the moment, Kenya is not adhering to any normal standard of good governance. The Kenyan human rights commission has documented nearly 300 cases of police torture this year. The election commission itself is not independent; it is appointed by the Government, something that we would not tolerate with the Boundary Commission in this country. Judges still receive instructions from the Government. Newspapers—either individual journalists or publications—are threatened. Members of Parliament need permits in order to hold public meetings in their constituencies, and 36 of the 85 opposition Members of Parliament were gaoled for lesser or greater times during 1993. The Bank of England, too, has failed to pursue the banks in this country which were involved in the Goldenberg scandal.
    All those matters can be legitimately criticised. When people ask, "Why do you pick out Kenya?", the answer is that Kenya is a great friend of this country and that one is entitled to be more candid with friends than with enemies. The Prime Minister has raised one human rights issue with the President, but I hope that we will do more to make it clear that a new governor of the Bank of Kenya and a new Finance Minister do not constitute a return to good governance. More than two years ago, the Kenyan Attorney-General promised that there would be reviews of the constitution, and in particular some of the colonial legislation which is still in place. That has not happened

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    yet. The opposition parties have not always been entirely helpful in the process, but we must say to the Kenyan Government that a lot more needs to be done.
    I could say the same—in the interests of time, I will not—on the subject of Nigeria, another friend of this country which at the moment is seriously in default of the standards of good government.
    I now refer to the arms trade. I take a rather different view from that of the Foreign and Commonwealth Secretary. I do not regard it as just a British issue. Regional conflicts around the world have been fuelled by the arms trade, from Bosnia to Angola. Just the other day, the Croatian Defence Minister said:
    "What I need, I get. The arms market is saturated, so saturated you would pay three times the price if you got things legally."
    It is reported that
    "Mr. Susak described buying arms in countries including Poland, Bulgaria and Russia as 'an open market' and said Croatia was now providing the army of the Muslim-dominated Bosnian Government with anti-tank weapons and ammunition for mortars, cannons and machine guns."
    An analyst of Jane's Defence Weekly has also pointed out:
    "They have obtained Russian-made rocket-propelled grenades from the former East Germany, Chinese anti-tank weapons from Pakistan and ammunition from Iran."
    I am not talking purely about a British phenomenon. The arms trade is one of the perils of the world today. There are new entrants—sadly, among them is South Africa. There is evidence that the South Africans were supplying both sides in the Rwandan civil war right up until last year. We must take a grip on the arms trade as a subject on its own.
    I know the counter-argument—the Foreign and Commonwealth Secretary almost hinted at it—that we must sell because, if we do not, somebody else will. That is, of course, the argument for a coherent European policy. Rather than having, as do some countries in the European Community, an arms embargo on Indonesia while we do not, an embargo on the sale of land mines while we do not, or other embargoes on Rwanda while we did not, there is a need for a coherent approach in the European Union on the issue if we are to have any hope of creating a common defence or foreign policy in future.
    If we are to protect jobs at home—I hope that it is not suggested that the economy is in such a parlous state after 15 years of Conservative rule that we desperately need to keep the arms industry flourishing—we must be realistic and accept that the end of the cold war surely means a diminution in the demand for arms. Therefore, we should, as the Clinton Administration have done in the United States, do much more to encourage our own arms industries to diversify into other sectors.
    A new Indonesian human rights commission was appointed by the Indonesian Government, and I met its members only two weeks ago. It is a good step forward, but it is a terrible regime. The Amnesty International report included some disturbing quotations in its 126 pages. After the massacre of 270 people in East Timor in November 1991, it quotes General Mantiri as saying:
    "We don't regret anything. What happened was quite proper … They were opposing us, demonstrating, even yelling things against the government. To me that is identical with rebellion, so that is why we took firm action … I don't think there's anything strange in that."
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    Are we saying that we are so hard up that we have to sell arms to a country which takes that view of its own population?
    When we sell arms to capricious regimes, we find that they come back to haunt us. We had the recent case of Dr. Mahathir of Malaysia who suddenly announced one morning, because he did not like a report in The Sunday Times, that he would not do any future business with Britain. Far more worrying are the commitments that we have entered into in the past through our export credits guarantee provisions.
    In 1993, Britain was the fourth-largest seller of arms. The World Development Movement, which I congratulate on having raised the court case on the Pergau dam, has revealed that arms sales receive more Government support than other export sectors. Almost 80 per cent. of British arms sales go to third-world countries. The Government have increasingly boosted defence exports in the past decade. In 1980–81, the year after the Conservatives came to office, defence exports took 6.5 per cent. of all export credits. That has risen to 48 per cent. last year. That is an extraordinary expansion.
    When things break down, as in the case of Iraq, what happens? Since the Gulf war, British taxpayers have had to bail out the banks and the companies who were involved in arms sales to Iraq to the tune of £652 million because the Iraqi Government have defaulted on paying debts; so the taxpayer has a right to question the sense of relying too much on the arms industry as part of our economic activity.
    Mr. Alan Clark said on the radio the other day that we should not worry about the nature of regimes and that selling arms was good business for Britain. It was all the old argument: "If we do not do it, someone else will." The Minister for Export Trade followed him on the programme and described him as a relic of empire. But at least Mr. Clark's view is refreshing, open and honest. I find that the Government's policy on the arms trade is wholly confused and sometimes duplicitous.
    We welcome the references in the Gracious Speech to progress in the containment of nuclear weaponry, but it is a sobering thought that, since the end of the cold war, no one has been killed by nuclear weapons but hundreds of thousands of people have been killed or maimed around the world by conventional weaponry of one type or another, including landmines.
    I believe that good governance, like charity, begins at home. I hope that during the rest of his time in office—however long that might be—the Foreign Secretary, who enjoys a considerable reputation not only in Britain but around the world, will use his efforts and Britain's unique position as a member of the Commonwealth, of the European Union and NATO to promote good governance as a major part of British foreign policy.
    5.12 pm
    Mr. David Howell: I am glad to follow the right hon. Member for Tweeddale, Ettrick and Lauderdale (Sir D. Steel). His interesting remarks, particularly on weapons proliferation, reinforce my view that the Foreign Affairs Select Committee is right to invest a great deal of time and effort in a study of weapons of mass destruction and their proliferation. It hopes to report to the House and contribute to the debate on which the right hon. Gentleman commented.

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    Although the hon. Member for Livingston (Mr. Cook) is not here, I welcome his arrival in foreign affairs debates. He has a very sharp mind and possibly a sharp tongue, too. I hope that we shall hear more comments from him. I enjoyed a certain amount of what he said, although I differ from him on some of the points that he made in opening. I know that it is early days for him in foreign affairs, but he seems to think that the world is divided into blocs. I beg him to get rid of that illusion. Of course, the politicians like to talk about the blocs of the European Union, the North American Free Trade Agreement, Asia and so on, but the hon. Gentleman will find as he travels round that all the forces of international finance, trade and investment are working immensely rapidly the other way.
    The fine constructions of politicians about different blocs and how they will line up and trade with each other are being increasingly marginalised by the enormous interpenetration of trade, investment and, above all, capital. That makes nonsense of a regional concept and even of a regional financial concept of Europe. I shall come to that in a moment. The hon. Gentleman will learn that and see that globalisation has happened far faster than the bloc-makers and bloc-analysts imagine. That is yesterday's analysis of the world, not tomorrow's.
    I am glad that foreign affairs has been promoted to Thursday in the debates on the Address. It used to be a Friday subject. That is good news. I hope that it is a recognition of the fact that foreign policy is not a separate, slightly eccentric category which ill-informed opinion pollsters put at the bottom of their list. When they find that they get fewer ticks for it, they conclude that foreign policy is of little interest compared with health, education, welfare and domestic issues. That does not reflect the reality, which perhaps the promotion of today's debate and certainly the Gracious Speech reflect, that the foreign policy context is beginning to condition everything. It conditions the most intimate domestic aspects of our lives, jobs and financial affairs. That needs to be taken into account by political leaders when they explain how they intend to face the problems of the future.
    I listened yesterday to the new leader of the Labour party. He began with a good speech. For those of us who have been here a long time, it contained one or two distinctly Wilsonian phrases. It brought back memories of the Wilsonian generalities about what the Labour party would do in this situation or that. There was a lot of stuff about the need for safe communities, good schools, lower crime rates and the rest. Join the club. We all want those things. They make fine additions to the peroration of a speech, but they are not policy and they do not take account of the wider international context which the new Labour party leader must begin to bring into his thinking and his speeches.
    Yesterday the Leader of the Opposition talked about a burst of growth. I should say perhaps more robustly than it has been said so far that that is not so this time. Much of the debate has not recognised what is happening to the British economy now. I am not all that proud of what is happening, in the sense that it should have happened before. For 30 years politicians, some of whom are in the Chamber at this moment, have made speeches in which they wished for sustained, inflation-free, export-led, investment-led growth in the British economy, the
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    emergence of the pound as a strong currency, lower unemployment, higher productivity and so on. All those things are now occurring.
    I have to pinch myself when I hear some of the spotlessly non-partisan analyses that come from objective quarters. The performance of the British economy is described as a sustained, not a transient performance and one that is delivering remarkable results and a perky export performance. Apparently even the Government's deficit is now falling.
    Many of the gurus are writing reports in which the word "surprised" occurs a great deal. That means that they forecast different things more along the lines of the forecasts of the hon. Members who speak for the Opposition. They said that it would all be low growth, high inflation, bad exports and rising unemployment. The gurus are all surprised that it has turned out the other way.
    We are now delivering an economic performance that I wish we had achieved in the 1960s and 1970s. We had some export growth at times after various devaluations, but it all rotted away and evaporated in higher costs, lower productivity, strikes and all sorts of social difficulties. This time that is not happening. We have a highly responsible trade union movement. We have virtually no strikes. There are occasionally one or two, but they are very few.
    Productivity is soaring and investment is pouring into the country to the point at which, as my right hon. Friend the Prime Minister said yesterday, we are taking 40 per cent. or possibly closer to 50 per cent. of the entire inward investment into Europe from countries in Asia and the United States. That is the reality of the international scene and the way in which the international economy is treating the British economy. That must be taken into account. One cannot simply ignore it and rant away about how terrible everything is, say that we must have more social spending here, there and everywhere and ask why the Government do not do it. That is an unrealistic stance. I hope that a little more realism will appear in the speeches of the Leader of the Opposition as he develops his style.
    Mr. William Ross: The right hon. Gentleman described a very happy view of the British economy. To what aspects of Government policy, especially financial and economic policy, does he ascribe that happy turn of events?
    Mr. Howell: The hon. Gentleman is tempting me. I shall certainly not pretend that Government policy in one country is totally responsible for all sorts of conditions, which as I explained are influenced by the global context. Nevertheless, the Government's present management of public finances is extremely prudent. They are creating the right monetary climate. We would all like short-term interest rates to be lower, but they are being managed with great skill, prudence and concern for the right monetary climate. The Government's deficit is falling and we are beginning to reap the benefits—years afterwards, as they always come much too slowly—of some of the labour market and social policy reforms of the past decade.
    Mercifully, we have not become entangled in the outdated, overcentralised and uniform social overheads that are making investment in continental Europe extremely unattractive. We have taken a much more modern stance and we have not centralised our social provision in the way that the Opposition Front Bench team wants, for some reason that I do not understand.

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    Those improvements are to the credit of the Government, business men and others. On this island and in Northern Ireland, they are beginning to deliver an economic performance that politicians have been waffling on about for 30 years but have never managed to turn into a reality. Now it is happening.
    Mr. Budgen: I entirely agree with my right hon. Friend, who has listed a persuasive catalogue of the Government's triumphs, all of which are true. Does he not think that he should mention 16 September 1992?
    Mr. Howell: I did not mention the date, but I mentioned the event. Perhaps my hon. Friend did not hear. I mentioned devaluations, or at any rate adjustments to the exchange rate, which have played their part. I do not dispute that for a moment. The asperity of his question is a little unjustified. I am well aware of all those things. Perhaps that one incident had some effect, but it is not the entire reason why our present position is so very good.
    A much wider issue is overshadowing the European Union debate. It lies behind whether we should subscribe to the social chapter and whether we should be able to deliver rising consumption, higher living standards and so forth in Europe. As my right hon. Friend the Member for Oxford, West and Abingdon (Mr. Patten) said in an excellent speech—I agreed with about 95 per cent. of it—that issue is the rising power and competitiveness of the dynamic Asian economies. They are proceeding at such a pace that those people who think that we have dealt with the Japanese challenge and that they are over the hill anyway are living in cloud cuckoo land. We are about to be confronted by a rising economic and competitive power—a power based on high technology and quality—and, what is more, a rising political power, which is already reflected in international institutions and will make anything that has gone before look mild. Far from arguing about which benefits should be enhanced, which social standards improved and which areas of consumption increased, policy makers in London and the rest of the Union should be preparing people for the fact that the name of the game is not benefits and improvement, but survival. Europe is confronting a problem that it has never before faced. It is a challenge to the lifestyle, values and intellectual hegemony of western European philosophical superiority, which we have never confronted before and for which most European electorates and most political debates, including this one, are completely unprepared.
    Mr. Patten: I agree with my right hon. Friend's analysis, which was more elegant than my attempt to portray the threat presented by the tiger economies of the far east. Does he agree that it is because those economies want low non-labour costs that they are becoming so productive? It is because they are jumping over our technology to new technologies in a way that we could not have imagined. Most of all, it is because they are not obsessed with internal harmonisation mechanisms. For example, there is no search for a single currency in south-east Asia. They are looking outwards and progressively towards the realities of the economic world.
    Mr. Howell: Asia is not a bloc. When those countries come together, as they did outside Jakarta recently, it is to call for free trade and not for blocism of any kind.
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    Some of the other qualities that they are developing sound suspiciously like those qualities that we thought were a European monopoly—civic values, which my right hon. Friend mentioned, hard work, loyalty to the family, commitment to high savings, a total commitment to children's education both day and night and all the other values that one associates with the Protestant ethic, as well as a reluctance to move towards greater consumption. They have those values and they are beginning to deliver fantastic economic performances.
    Let us consider some of the facts. By 2025, the gross national product of the east Asian powers will be the same as that of the European Union and the North Atlantic trade bloc combined. Throughout the recession, the national products of countries in eastern, central and parts of western. Asia have been growing at more than 6 per cent. The export opportunities are vast. A fairly small economy such as Malaysia already imports more from the United States than the whole of eastern Europe and Russia. That is just the beginning. There will be a vast range of import potential for those countries. The Asian countries will not merely make products for export to us with their lower labour costs. They will provide vast import potential—huge new markets that we must be agile enough to grasp.
    The challenge will require a total change in our attitude to what is attainable and where we put our resources. When I visited Bombay recently I was impressed when major entrepreneurs told me that they intended to develop the highest quality steel products and steel alloys for export to world markets. They will do so at a cost that will be 25 per cent., at the most, of that of the cheapest equivalent steels produced in the European Union.
    I do not know how we will cope with that competition and I do not think that anyone is prepared for it. We talk as if our steel industry were fine, but it is not. It is about to be challenged by competition of a type that we will have the greatest difficulty in meeting.
    One must judge the debate and the Gracious Speech against that background —the new realism about our needs in Europe and how on earth we can maintain or increase our competitiveness, rather than pile more benefits and costs upon ourselves. The speech by the Leader of the Opposition came out as yesterday's message. His concern was a centralised standard of social provision that would not even be laid down at national level but in Brussels. On such sensitive issues one would think that one would argue that social care and rules should be crafted as closely as possible to the shop floor and the people concerned. The idea that they should be crafted in Brussels and their support ever-enlarged seems totally inappropriate. It does not fit into the new context that candid political leaders should be explaining to their supporters.
    The real European debate is how to increase our competitiveness, take the best from other cultures and see what we can learn from them. I mean the Confucian and Islamic cultures—especially the former, which is part of the culture that is providing the framework for some of the most successful economies on earth. I am not saying that we need to copy the Chinese or Indonesians on human rights; that would be crazy. But we need to take some of their values, just as the Japanese a century or more ago decided not to copy the west, but to take the best of our values and techniques and apply them and graft them on to their own culture. We need to do the reverse with equal vigour. If we go on in the mean time

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    preaching our own European superiority and reacting to threats by putting up more protectionist barriers, we are all doomed. There will be constant failure and a decline in our living standards.
    I would apply the same strictures about irrelevance to my hon. Friends who are getting worked up again about the increased contributions to the European budget. The position is different from that which prevailed at the time of the Maastricht treaty debate. I must confess—this may be a shock and a horror to some—that I felt that the cause of the Maastricht rebels in questioning the rush to political and monetary union which was embodied in the Maastricht treaty had some very commendable parts to it. I did not follow it myself, and I voted with the Government. But there was, and remains, an extremely valid argument that elements of that treaty were, in the words of my hon. Friend the Member for Worcestershire, South (Mr. Spicer) in his excellent book, "A Treaty Too Far".
    But to use the same sort of language and thought in saying that the additional expenditure on the European Union budget requires the same degree of indignation is getting things badly out of proportion. If the anti-Maastrichteers want to concentrate on doing some useful unravelling of the bad side of Maastricht or halting federalist impulses, they should look at other aspects of the Edinburgh package. For instance, they could look at the fact that, unfortunately, we allowed half our aid programme to slide into the hands of international and multilateral funds; about 40 per cent. of the aid programme has gone to the European Community. That needs a certain amount of examination and I am glad that the Foreign Affairs Committee is about to put before the House a detailed analysis of some of the consequences of that. There is a cause for those concerned to fight.
    Let us turn our minds, as others have suggested, to the agenda for the 1996 IGC. Let us make sure that we make an effective input to the so-called reflection group which began in the summer. We should propose arrangements for reforming the Commission and the Court of Justice, and for making subsidiarity a real political process. That means bringing political decisions to the House of Commons about what the Commission may be brewing up and turning into regulations before those things are dumped on our heads.
    Let us develop the links with the European Parliament—which we are always talking about vaguely—into specific links which would enable the House to learn much earlier about the policy seeds and bulbs which will grow into the directives and regulations that cause so much dismay later. We are always saying that the European Parliament does not tell us. We scrutinise the legislation, but by then it is too late. We must get into these matters much earlier. That would be a far more useful diversion of energy for some of the much-vaunted rebels than rushing to the media every five minutes, telling them of the terrible things they are going to do.
    I apply the same strictures to another line of thought that has developed in the European debate—that it is all hopeless and that we have been defeated before we start. The view is, of course, shared by extreme enthusiasts of a federal Europe, who say that there will be a German-French axis and a federal fix, and if we do not join immediately, we are doomed; and the extreme anti-Europeans, who are certain that there will be a
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    Franco-German axis, that we are out of it and defeated, that we are not winning the argument and that we should cut our losses and get out of it altogether. There is a diagnostic alliance between the two wings which I believe to be completely wrong and defeatist.
    We would do much better to develop confidently—now that we are Europe's most successful economy—our view of how the European agenda should unfold after 1996. If we do that, we will find that we have a wide range of allies in all the other countries of the European Union; including new members such as the former European Free Trade Area counties, the would-be members from the Visegrad countries and others. That requires vigour and confidence in the development of our view of Europe. I am glad that my right hon. Friend the Prime Minister has shown that, and I would like other Government Members and everyone concerned with the development of our policy in Europe to show it as well.
    By the same tokens, and against the background of my recognition of the power of Asia, some of the ideas which right hon. and hon. Members are floating about beefing up the Atlantic community—my right hon. Friend the Member for Oxford, West and Abingdon (Mr. Patten) mentioned that—are, if I may say so, a little out of date. If one sits in Washington, or west of Washington, one is halfway into the Asian world, and one can recognise the enormous, dominating and increasing power of Asian investment, trade, standards, quality and design in 1,001 ways. I am not just talking about Japan, but about the old and new tigers as well.
    The Atlantic community is of interest in developing NATO and I am glad to see that the United States is beginning to talk about expanding NATO and is not just sitting on its thumbs on the matter. My right hon. and learned Friend the Secretary of State for Defence, who will reply to the debate tonight, will no doubt have something to say on that, and there are ways in which we can strengthen, rather than weaken, transatlantic security arrangements. Interpreting the misunderstandings over Bosnia as a great rift between America and Europe is an absurd exaggeration, and I am sure that the matter can be carried forward.
    The idea that there is an Atlantic community beyond security is too narrow, and we must concentrate on what we must do to develop further, as this country is doing with great success, our links with the great Asian economies which will dominate during the next 20, 30 or 40 years. It is a matter of great pride to me that this country is carving out a unique foreign policy with Japan. We have built a closeness of identity and understanding in all sorts of areas. Those areas may not appear in the script. They may not fit in with the view of blocs, or with the view of the right hon. Member for Tweeddale, Ettrick and Lauderdale that we must give priority to Europe, or with the idea of an Atlantic community. They happen to fit into the reality, and they are of vast benefit to this country, as well as to Japan.
    The reality which we all face is not the marginal one of European budget contributions or whether we have a social charter. The reality is that the Asian challenge of competitiveness will overshadow everything. Our choice is either to give up and go for protection—Sir James Goldsmith is inclined to do that, and certain policy makers of influence in Europe are longing to put up the protectionist shutters—or to embrace the challenge and learn from the best of different cultures which, hitherto,

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    we regarded with some patronage and a smiling superiority. We now see to our surprise that they can deliver up economic and industrial success, technology, learning and quality on a scale which we never dreamed about.
    We had better get our skates on and understand how those cultures work and what we can take from them to prepare ourselves for the years of struggle ahead to remain competitive and to maintain even what we have in the way of a standard of living.
    5.37 pm
    Mr. Robert N. Wareing: I agree with the right hon. Member for Guildford (Mr. Howell) that we should not look at the world in terms of blocks. May I remind him that my hon. Friend the Member for Livingston (Mr. Cook) emphasised the fact that the future of Britain cannot be outside Europe and the European Community?
    Some of us held views contrary to that in the past. Many of us have changed our views in the intervening 20 years, and particularly in the past 15 years, because much of Britain's manufacturing base has been decimated despite the fact that resources are there. North sea oil revenues—£124 billion of them—were available for investment, but they have been allowed to be whittled away by the Tory Government since their election in 1979. We might ask ourselves what the Germans or French would have done with those revenues. Whereas, 20 years ago, it was just conceivable that Britain might be the offshore Japan of Europe and go it alone, those days are long gone. We must accept that we must make our way in the world as part of the European Union.
    That does not mean, of course, that we should accept every institution of which Britain is a member, for example NATO. It was a child of the cold war. At that time many of us looked forward to the day when the Warsaw pact and NATO folded because it was no longer necessary to maintain those warring alliances. The Warsaw pact has gone, but the Gracious Speech still refers to NATO playing
    " a wider role in protecting stability throughout Europe."
    I must warn that I believe that NATO could be a source of instability in Europe if we seek to enlarge it in line with an enlarged European Union. We want that union to be enlarged by eventual membership of Scandinavian and eastern European countries, and even the Baltic states. If we were to propagate the view, however, that we wanted eastern European countries such as Hungary, Poland and Czechoslovakia—and perhaps Finland—to be members of NATO, that would be met with a swift reaction from Russia. We might then find ourselves back in the days of the cold war. For that reason it is important to develop the role of the Conference on Security and Co-operation in Europe. The summit at Budapest should be used to give the CSCE more power and influence in international relations. At least Russia is party to the CSCE; similarly its participation in Partnership for Peace is extremely welcome.
    With the end of the cold war relationships have changed. The United States, for example, recently decided to defy a United Nations resolution by lifting its arms embargo against the warring factions in Bosnia. Although
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    the Foreign Secretary does not want us to depart from the pan-Atlantic relationship within which we have worked since the second world war, I advise caution.
    In common with many of my hon. Friends, I welcomed the election of President Clinton, but I must confess that now I am not so sure. I saw the wonderful work done by the American forces who were sent in to Somalia by President Bush. They saved people in Baidoua, Belet Yuen and other townships from starvation by getting food to them. Those troops carried out a highly successful operation in most dangerous circumstances, but then President Clinton decided that helicopter gunships were the answer to President Aidid. I look to Europe and not to those across the Atlantic to determine future British foreign policy.
    One of the greatest dangers that lies ahead of us is the rise of Muslim fundamentalism, which is already apparent in Egypt and Algeria. In a decade from now, middle eastern countries, should they be ruled by rogue leaders, could launch missiles against this country, if they so wished. For that good reason it is important that we should achieve a common foreign and security policy not only with our present partners in the European Union but with those other countries that we hope will join it. We must also work with Russia, which is vital to the future of European security.
    Security is not built on military alliances. We must ask ourselves why we have wars in places such as Rwanda. They are caused by poverty, disease and strife within communities. We must, similarly, guard against a rise of nationalist forces in Russia and eastern European countries. How do such forces become powerful? They are created by the divisions that arise in societies which throw their all behind the god of the market.
    Whenever I meet visitors from Russia and eastern Europe, or go to those countries, I always warn people against a mad rush from the extremes of highly centralised, planned economies, such as that which existed under bureaucratic control in the former Soviet Union, to extreme Thatcherite market economies. I know that Conservative Members would not agree with my advice, but I always say to those people, "For God's sake, don't throw the baby out with the bath water." I remind them that not everything that existed in the former Soviet Union was a disaster. In 1956, for example, a White Paper was published—it prompted some discussion in the House—which showed that adult further education and university education was available to far more people in the Soviet Union and in the United States than in Britain.
    Because of the loss of welfare provision and mass unemployment in east Germany, the recent elections in Germany were not only marked by gains made by the SPD—I was pleased about that—but by gains made by the PDS in the eastern Lander. For the same reason, parties which consist of former members of the Communist parties are coming into office in Lithuania, Poland and Hungary. I hope that those former Communist members have learnt from their mistakes, just as I hope that Conservative Members have learnt from the mistakes that they made during the Thatcherite period—a period that some of us still doubt has come to an end.
    The Foreign Secretary referred to the Baltic states and their eventual membership of the European Union. I hope that that day is not far away, but we must remember that that will mean that Russians will live inside the European Union. It is therefore important to insist that when those

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    countries apply for membership, their record on human rights for minorities in their countries should be absolutely without blemish. The Latvian Government, for example, must be told not to discriminate against the large Russian minority within their country. For example, a person who speaks Latvian fluently and who considers himself Latvian, not Russian, is still discriminated against and is denied certain rights because he served at one time in the Soviet army. It is that type of problem that leads to conflict, just as it did in the former Yugoslavia. 'The fact that we recognised Croatia, which was discriminating against its large Serb population not just in Krajina or the borderlands but in Zagreb itself, is the reason why there is now a war in Bosnia.
    Although ethnic cleansing has by no means been all one-sided, our media should consider taking a more even-handed approach to the former Yugoslavia. A fortnight or so ago, the news was full of the offensive launched by the Muslim forces in Bosnia-Herzegovina, central Bosnia and around Bihac. It went almost without comment or criticism in the western media, which simply said that the Muslims were trying to get by military means what the Bosnian Serbs had refused to give them by not signing the contact group's plan. But the United Nations' resolution does not call for military action to reinforce the contact group's plan. Today, however, reports have appeared in our newspapers on the Serb counter offensive around Bihac, and President Izetbegovic who, a few weeks ago, was launching his offensive and gloating about how he occupied more territory inside Bosnia, is calling on the UN to take action. We should tell him that there will be no military action.
    The Government have been right—I hope that no deals will be done in the future—to maintain their opposition to lifting the arms embargo, as the Americans have. For God's sake, let them not be persuaded, as they were by Herr Genscher on the recognition of Croatia, to lift the arms embargo. The humanitarian effort would undoubtedly come to a standstill if there were a large-scale influx of heavy armoury, as has been suggested, for the Muslim effort in Bosnia-Herzegovina. The Government have made it clear, and they should maintain their position clearly in the future, that our contingent in UNPROFOR will be withdrawn if the arms embargo is completely lifted.
    I welcome the fact that some sanctions have been lifted against Yugoslavia—that is to say, Serbian Montenegro—because it must be recognised that there are more than 200,000 refugees from Bosnia and Croatia, and they are not all Serbs. Anyone who visits refugee camps, as I have, in former Yugoslavia will see Muslims being tended by Serbs. It is not true to say that, in the Serbian-controlled part of Bosnia, there are no Muslims, and that Muslims are not living easily with their fellow Serbs. A degree of civilisation exists within an otherwise uncivilised part of the world.
    Human rights is the most important issue in terms of our international policies. The rights of minorities, wherever they may be, should be put at the forefront. I agree entirely with the right hon. Member for Tweeddale, Ettrick and Lauderdale (Sir D. Steel) on the arms trade. It is no use the Foreign Secretary telling the House that if we do not supply arms, somebody else will. It is no use him saying that the Opposition do not want to maintain the jobs of the workers whom we represent. Of course we do, but those workers would agree that that does not
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    justify putting arms into the hands of murderous dictators. After all, the same argument could have been used in the early 1930s, when the Foreign Secretary of the day might have said that Herr Hitler was trying to build up the German economy and that Germany had suffered many disadvantages after the treaty of Versailles, so we shall provide him with some of our machine tools to get his factories going. There is no justification for selling arms to regimes such as those in Indonesia. There was no justification for selling arms to the Iraqi regime, which later used them against our constituents who were there with our military forces.
    The whole of our foreign policy should be aimed at creating a better spirit of humanity so that, when somebody is tortured in Pinochet's Chile, and when whole families are murdered in Suharto's East Timor, it affects us equally. It is sometimes said that man is not an island—
    Mr. Phil Gallie: I am interested in the hon. Gentleman's words when he looks back with sound knowledge at regimes such as those in Iraq and Indonesia and makes judgments on the sale of arms. Will he look forward and name the regimes—perhaps Saudi Arabia and others—to which we should not sell arms in the future? It is easy to make retrospective judgments, but when the Government are making decisions, they must consider jobs and look at current events rather than at what happened in the past.
    Mr. Wareing: What the hon. Gentleman has in mind is the fact that Saudi Arabia is the source of our oil supplies, which should make a difference. I am sorry, but that should make no difference.
    Mr. Gallie: No, that was not what I had in mind. May I explain to the hon. Gentleman? It is all right to look back and say that we should not have supplied arms to those regimes. Will the hon. Gentleman look into the future and, given different democratic processes and change in Governments, try to determine which regimes should not be sold arms in the future?
    Mr. Wareing: I hope that any British Government worth their salt would try to persuade even our "commercial friends" that democracy is the right way forward. I do not excuse the rule by sheikdorns in the middle east. Those countries, too, should come under pressure. It is all very well to say that they produce important raw materials for our industries, but they need customers. If collective action were taken through the United Nations, as the right hon. Member for Tweeddale, Ettrick and Lauderdale suggested, no customers would be willing to trade with dictatorial, autocratic regimes that torture their populations and threaten the lives of people in other countries. That is the criterion on which we should proceed.
    Someone said to my hon. Friend the Member for Livingston (Mr. Cook) earlier, "Ah, but a Labour Government did so." May I say at the outset that I do not excuse any former Labour Government for their mistakes. Before I came to the House in the 1960s, there was an argument about whether we should maintain a naval base at Simonstown and supply aircraft to the South African regime. We should not have done. We were wrong to do so. Sometimes parties must admit that, yes, they made mistakes. When Labour Governments sold arms to South Africa or to any other dictatorial regime, it was a mistake, and it must not happen again. I am sure that, after the next

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    general election, when a Labour Government will further a progressive socialist foreign policy, in the European Community, that will be one of the mistakes that will not be repeated.
    5.59 pm
    Mr. Cyril D. Townsend: It is a pleasure to follow the hon. Member for Liverpool, West Derby (Mr. Wareing), especially when he speaks about the former Yugoslavia, because the House appreciates his considerable knowledge of the scene there: he has visited the country frequently, and he has many interesting things to tell us.
    I was not quite so happy to hear the hon. Gentleman's opinions about the arms trade, but I shall not take that one up. He asked where the proceeds of North sea oil have gone, and it is worth reminding him of the large chunks of the United States that are now in the hands of English companies, partly as a result of North sea oil.
    It is also a privilege to be allowed to take part in this debate on the Gracious Speech about foreign affairs and defence, and one has to start with a self-denying ordinance. There are a hundred and one fascinating topics to pursue. I want to say something about the United Nations, and something—you will not be surprised to hear, Madam Deputy Speaker—about the middle east. However, I shall begin with Europe, because currently the media spotlight is on our European future, partly as a result of the great rebellion—which I think is now dissipated.
    I am delighted that the new Minister for Europe, my hon. Friend the Member for Boothferry (Mr. Davis), is here to hear my brief words on the topic. I hope that the Government will help to popularise the European Union, because I believe that the lack of public support for what the Government are trying to achieve puts the brakes on to some extent.
    The European Union can help. We are scandalised by the fraud that has been disclosed. I welcome the suggestion that a country that has grossly abused the system should be cut off from European Union aid. I wonder what the Government's position on that proposal may be.
    Mr. Budgen: Will my hon. Friend give way?
    Mr. Townsend: May I proceed?
    Secondly, the European Union obviously must avoid some of the nonsenses that the media delight in picking up, be they bent bananas or harmonising the noise of lawn mowers. They drive our constituents nuts—quite rightly. My hon. Friend will not be surprised to learn that, in the urban constituency of Bexleyheath—we got rid of our last cow just before I arrived on the scene—my constituents are maddened by the huge subsidies that go into the agricultural system in this country and many others.
    The tabloid newspapers look at Europe through the wrong end of the telescope. I am described in one of the parliamentary reference books as a Euro-idealist, whatever that may mean, but, yes, there is an element of idealism in the concept of the Community that we are trying to build up.
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    Let me put it this way. My grandfather was in the Navy for four years during the first world war; my father was in the Army for five years during the second world war. Both those wars began in Europe, and they came about as a result of the great antagonism between France and Germany. Now we have France and Germany inside the Union, haggling away about the minutiae of European Union daily detail, and that is splendid. Let no one minimise or misjudge the magnitude of what Europeans have been able to achieve in western Europe. It is a success story.
    The problem is that too many countries are trying to join too soon, before they are ready. That makes life difficult. We shall have to change the structures of the Community at the next intergovernmental conference, and I welcome the proposal that we should drop one of our Commissioners. We shall react to change the structure of the Community to deal with the genuine problems of success.
    I hope that the Secretary of State has a moment to listen, although I confess that he has heard my opinions in private many times. I support the ideas that Sir Leon Brittan and Lord Carrington have put forward over the years. We simply cannot continue to draw a line between defence and the European Union. Times are moving on. We must build up a European dimension to our defence policy.
    At the moment, the Foreign Secretary can talk about European security, but he is not allowed to talk about European defence. How can one have a rational policy for European industries if one totally excludes the defence industries, which are an important part of the whole?
    I should like the Government to be more positive about involving the European Union in defence. One of the by-products of the recent, very unfortunate, move by the United States in relation to Bosnia may be that it will draw attention to that argument.
    I shall now briefly discuss the United Nations. I happen to be the Conservative representative on the committee that is trying to decide how we should celebrate the 50th anniversary of the United Nations. I assure the right hon. Member for Tweeddale, Ettrick and Lauderdale (Sir D. Steel), who, incidentally, I welcomed to Hong Kong in 1965 as a Government official in Hong Kong, that that committee is determined not to be complacent, not simply to sit back and say, "How well we have done". On the contrary, we are only too well aware that the United Nations must advance to tackle the new problems that were mentioned earlier.
    One aspect, curiously, has not been mentioned—the increase in the number of the permanent members of the Security Council of the United Nations, the P5. I am proud of the fact that it was Britain that called a special summit meeting a few years ago, to consider the future of the United Nations, just after Dr. Boutros Boutros-Ghali had been appointed, and following, thank God, the end of the cold war, which had paralysed the United Nations.
    When the Prime Minister made a statement in the House after that successful summit, he said, in reply to a question by me, that he saw no reason to change the number of members who had permanent seats on the Security Council. While we have been away for the summer, the Foreign Secretary has said that the United Kingdom now would welcome Japan and Germany as permanent members of the Security Council.

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    I am not criticising the Government. What has changed is that Germany has now sorted out its constitutional problems and, I hope, will start helping UN peacekeeping operations around the world—that help is sorely needed—and Japan has committed troops, first in Cambodia on a small scale, and secondly, more recently, in Rwanda.
    The Germans are right to resist the call to put their troops into Bosnia. I am sure that the hon. Member for West Derby is only too well aware of how they treated the Serbs in the last world war. However, it would be good to have some German aeroplanes to take part in enforcing the no-fly zone over former Yugoslavia.
    Mr. Wareing rose—
    Mr. McWilliam rose—
    Mr. Townsend: I give way to the hon. Member for Blaydon (Mr. McWilliam).
    Mr. McWilliam: German aircrew and aircraft are policing the no-fly zone in E3 sentry aircraft.
    Mr. Townsend: I am informed that they have not yet committed any of their fighters, but no doubt the experts can put us right about that.
    I hope also that the Germans might play a part in Macedonia, and relieve some of the United States troops there.
    Mr. Wareing: Will the hon. Gentleman give way?
    Mr. Townsend: May I continue, if the hon. Gentleman does not mind?
    Mr. Wareing: I simply wish to make it clear that there are German aircraft in the former Yugoslavia, but they are providing essential supplies, flying from Zagreb to Sarajevo.
    Mr. Townsend: I am specifically referring to the shortage of fighter aircraft to enforce the no-fly zone over Bosnia.
    I hope that the Germans will play a big role in UN peacekeeping. However, I think that there is a danger that, if the P5 turn into P6, P7, P8 or whatever, the Security Council may become unwieldy and unmanageable. God knows, it is hard enough for the Foreign Secretary to obtain agreement over Iraq or Bosnia at present.
    We all enormously welcome the cautious progress being made in the middle east. I gather that the Secretary of State, who has recently been there, will make further comments on that this evening. I particularly welcome the comparatively recent move between Israel and Jordan—about time, too.
    There is an appalling tendency for our newspapers to suggest that all is now well, and we can turn our gaze elsewhere. That is quite untrue. The Syrian front will be a difficult one for the Israeli Government. Yitzhak Rabin encouraged the settlers to move there, and now he must try to persuade them that Israel is to abandon the entire Golan heights. I hope that the Secretary of State will make it absolutely clear that no halfway measures will be acceptable to the United Kingdom.
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    The other day I came across a wonderful quote—it must be 20 years old now—by the late Lord Caradon:
    "To imagine that security comes from repression, grabbing and holding territory, from creeping colonisation in Arab lands or from a concrete encirclement in Jerusalem, from domination by forts and outposts, is a most dangerous deception."
    He continued:
    "every schoolboy knows that forts in enemy territory are not a guarantee of security, they are a guarantee of insecurity, an invitation to resistance, harassment and attack."
    I have two observations to make about south Lebanon. I find it distasteful that, within a few days of Yitzhak Rabin and Chairman Arafat being awarded the Nobel peace prize, certain Shi'a villages in southern Lebanon should be shelled in retaliation against the activities of Hamas in the occupied territories and Israel. Those shells killed innocent Lebanese civilians. The chances of tinting a member of Hezbollah are few and far between.
    I wish to draw attention to the horrors of a detention centre camp called Khiam in Israeli-occupied Lebanon. I am told that, since 1985, that camp has held 230 Lebanese Shi'a citizens. There is a dispute between the south Lebanese army—the Israeli surrogate force in that part of the world—and the Israeli defence force over who is responsible for that camp.
    Believe it or not, the individuals in that camp are not allowed visits from relatives and the International Red Cross or Red Crescent are not allowed to see them. That is scandalous—I am told that a Foreign Office Minister has raised the matter with the Israeli authorities. When he winds up today's debate, will my right hon. and learned Friend the Secretary of State for Defence give an assurance that the British Government will not allow that matter to rest?
    Gaza should concern us all. Support for Hamas is on the increase. We must remember that it was the Israelis who helped to build up Hamas as a means of countering the influence of the Palestine Liberation Organisation. As long as we ignore the Palestinian problem, or put it on the back burner as Yitzhak Rabin has been trying to do, the more support will flow towards Hamas.
    The British Government are playing a useful role and supporting the Palestine police. But Chairman Arafat—who has unfortunately adopted an all too autocratic style in Gaza—needs the help of the international community now. It does not take much imagination to see how desperately wrong things could go if jobs are not created in Gaza and the occupied territories. Individual Palestinians who dream about a Palestinian state must be able to see that the sewerage system is beginning to work, jobs are coming and there is some prosperity.
    I am a strong supporter of British foreign policy. We are in a unique position as a member of the North Atlantic Treaty Organisation, the European Union, the Western European Union, the Commonwealth and the G7 countries. But that means that we must have an active and constructive foreign policy. We normally do, but this is no moment to sit back on our laurels.
    We are privileged to be served by probably the best diplomatic service in the world—a phrase given to me by a United States diplomat in London. He said, "I cannot understand how it is that I read in your papers, day after day, scandalous references to your diplomats, when we are all jealous of their linguistic abilities, traditions and

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    skills." We are lucky that our diplomatic Rolls-Royce is driven by the Foreign Secretary, whose reputation is growing ever greater in the international community.
    6.15 pm
    Mr. John McWilliam: I am privileged to participate in the debate and to follow the hon. Member for Bexleyheath (Mr. Townsend), with whom I had the honour of sharing a desk room many years ago—they were happy days.
    I wish to take up the comments of my hon. Friend the Member for Liverpool, West Derby (Mr. Wareing) about former Yugoslavia. He was right to say that, if the then Federal Republic of Germany had not dashed in desperately to recognise Croatia long before any countries in former Yugoslavia should have been afforded recognition, we would not be in the sorry state that we are now.
    But the fact that we are in our current state leads me to the remarks of the hon. Member for Bexleyheath, who suggested that Germany should play a more active peacekeeping role around the world. It should, but it is not practical to employ in a peacekeeping role German soldiers or Luftwaffe aircraft in an area which they once occupied and in which they had 40 divisions.
    I, too, have travelled to Yugoslavia, and I know how local people feel. I know that such action would do more harm than good. The Luftwaffe is doing a sterling job in flying transport aircraft and E3 Sentry aircraft that help us to police the no-fly zone. It picks up those aircraft that are breaking through the no-fly zone and directs the fighters to them.
    I take issue with the Foreign Secretary when he tries to dismiss the American change of policy in Bosnia as merely changing the orders of two ships. That is to misstate what has happened. Once again, for domestic political reasons, America has decided to break with the rest of us. The snag is that we have British soldiers on the ground, up front in Yugoslavia. Those soldiers would be at risk if the change of policy provoked any escalation in the fighting.
    Our troops are carrying out a splendid job for one reason only—to ensure that relief reaches the civilian population in the forward areas in Bosnia. That is their only task; they are not trying to police the area or to impose a truce. They are performing their task supremely well. They would be unable to do so were it not for the superb work of the Royal Engineers in opening up tracks and emergency roads to allow the convoys to get through. I am fortunate enough to have travelled to those regions and to have seen at first hand what is happening.
    I wish that people would not be so off-hand in their use of the phrase "ethnic cleansing", which happens on all sides. The phrase does not mean ethnic cleansing: it means that a thug knocks on a door in the middle of the night and tells the inhabitants of the house that they are the wrong religion, and that if they do not move out in the morning, he will burn down their house. If they do not leave, he burns down the house around the people in it. That is not ethnic cleansing; it is xenophobic thuggery, and it should not be tolerated anywhere.
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    We need to remind America that it is our soldiers who are at risk in Bosnia. Much the same happened during the Gulf war, when, for domestic political reasons, the Americans could not bear to take action against the Iraqi looters and terrorists on the Basra road, so they stopped us going after the Republican Guards armoured battalion.
    Had we been able to go after that battalion, 45 Commando might not be sitting on the border guarding Kuwait now. I hope that the Secretary of State for Defence will be able to tell me tonight that my friends in 45 Commando can look forward to spending Christmas at home. It would be tragic if they had to be away, as they are not long back from Northern Ireland.
    I am delighted that peace is progressing in Northern Ireland, and delighted too to hear the Secretary of State for Defence say that, if the process continues and we can withdraw troops, we will not consequently reduce infantry numbers, because the infantry are already overstretched. I have a two-week-old niece in Northern Ireland, and some nephews, and I want those children to grow up there with the same freedom and chances that I had. I do not want them to have to put up with what my wife had to face when she was young—the problems that drove her away from Northern Ireland. The only good result of that was that it enabled me to meet her.
    We often say that we should not sell arms to tinpot regimes or repressive dictators, but we forget that our defence manufacturing industry is actually part of our defence capability. Without that industry, our capability would be significantly diminished. Incidentally, our defence manufacturers use a great deal of steel to make the things that our soldiers, sailors and airmen need. During the second world war, Lord Haw-Haw said that the Luftwaffe was going to destroy the Derwenthaugh cokeworks which was so essential to our steel industry. In the end, the Luftwaffe never managed it; it took 14 years of Conservative Government to flatten those cokeworks.
    I must also condemn the Government for their short-sighted forward ordering policies, which have resulted in the Swan Hunter shipyard being virtually destroyed. It was a shipyard with a proud tradition of building great naval vessels on time and to price—and without defect. All that is lost now.
    The same appeared to happen with the FH70 ammunition saga. We decided to give the order for that ammunition to the Germans and the Italians. The Germans discovered that they could not produce it, and passed the order to the Belgians, with the result that, during the Gulf war, we could not obtain 155 mm ammunition from the Belgians, because they were not too sure about the Gulf conflict. That was appalling, but we are in grave danger of making the same mistakes again.
    Gordon Foxley, director of munitions procurement at the MOD, has just been convicted of bribery. The Government are trying to recover some money from him. Victor Temple QC, prosecuting, said that the Government were keen to recover the balance of corrupt moneys. The judge, however, said that there was no evidence that the MOD had lost by being supplied with ineffective fuses and ammunition. He said that there was no evidence that Mr. Foxley directed work away from the Royal Ordnance factory—that was one reason why he gave Mr. Foxley a reduced sentence.

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    The facts do not support that contention. The only reason why the judge had no evidence was that the MOD, for reasons of its own, chose not to present any. The facts of the matter are that the Jurgens fuses that Mr. Foxley persuaded the MOD to purchase instead of Royal Ordnance fuses cost £14.40. The Royal Ordnance fuses cost only £6. The episode meant the loss of a factory at Blackburn and more than 1,000 jobs lost in Royal Ordnance factories, including at mine, Birtley—not to mention the loss of £24 million of taxpayers' money.
    The fuses made by Borletti, the other company that bribed Foxley, did not work in rain and were useless in battlefield conditions. The MOD presented no evidence, because it would have been politically uncomfortable to present any. The Government have wittered on at us about the need to introduce foreign competition. There is such a need, but there is no need to do it in this way, by giving in to bribes from foreign companies.
    We have lost British jobs and British defence manufacturing capability, simply because of a combination of a corrupt civil servant—fortunately there are very few of them—and a Government policy that found it inconvenient to produce evidence that suggested that British jobs were being lost.
    I agree with the right hon. Member for Tweeddale, Ettrick and Lauderdale (Sir D. Steel) and with my hon. Friend the Member for Livingston (Mr. Cook) about the need to be careful when we sell arms—we should not just sell them to anyone. We must also be careful to distinguish between commission-influenced peddling and bribes. A healthy defence manufacturing industry cannot be based on either.
    There have been some long speeches today, and I do not intend to make one myself. I want to end with a plea which I hope the Defence Secretary will pass on to his right hon. Friend the Foreign Secretary.
    I refer to a tragedy that occurred on 19 September 1989, when a UTA airliner went down over the Tenere desert, just north of Chad. On board was a friend of mine, David Middleton. I spoke to his wife just the other night. I have written to the Foreign Office and taken deputations there on behalf of Mrs. Middleton, but since 1989 neither she nor other British dependants have received compensation for their loss.
    Mrs. Middleton has not even received her husband's belongings. They were sent on to someone in Canada, and she was tersely told that if she wanted them back she would have to get them herself. She is in Paris tonight. She should have been at a hearing today, but it was cancelled because UTA wanted more information—copies of her marriage certificate and her children's birth certificates. The airline seemed quite happy to recognise who she was several years ago when it sent her husband's remains back for her to dispose of; now the airline is not happy to bring the matter to a conclusion.
    I do not think that the Foreign Office is doing enough to help Mrs. Middleton and other British victims of the disaster to obtain their rights. The same applies to other British victims of terrorism. I therefore ask the right hon. and learned Gentleman to press the Foreign Secretary to stop this injustice, to stop the bureaucratic wrangling and to use all his influence with the French Government to say that enough is enough. Why have French victims been compensated while British victims have not?
    6.28 pm
    Mr. Nicholas Budgen: It is a pleasure to take part in this debate and to follow the hon. Member for Blaydon (Mr. McWilliam), whose references to Northern Ireland I particularly welcomed. It is little short of scandalous that so few right hon. and hon. Members take a detailed interest in Northern Ireland.
    It is interesting to observe that the Labour party has changed its Front-Bench spokesman on Northern Ireand, and is moving away from its aggressively nationalist posture. It is perhaps too much to hope that one of the great parties in the House will openly support the Union, but it is certain that the Labour party is moving towards a more friendly attitude to it. I have no doubt that the Unionists, who were once our allies but who often now are unfortunately our enemies, will have noted the important change in the Labour party's view of Northern Ireland.
    The Government gave a frank exposition to those of us who might have doubts about the European Communities (Finance) Bill. I have not made up my mind about that Bill. I was aware that, at least in year one, not a great deal of money was involved. Arguably, it was only £75 million, and it seemed necessary and reasonable to listen to the Government's arguments about the matter.
    I am grateful to the Prime Minister for raising yesterday the issue of a general election in such a clear way. The last time that issue was raised was at the end of proceedings on the Maastricht legislation. Those of us who had the misfortune to disagree with the Government on the treaty did not have much time to consider the position, and there was no great opportunity for the nation, the newspapers and commentators to consider the grave constitutional issues that were raised by the threat of a general election.
    At that time, there was no great certainty that the monarch would have allowed the prorogation of Parliament and a general election. Therefore, we did not really know, and the threat was never really tested. 'The Government are to be congratulated on succeeding in their threat, because everybody knows that threats in respect of Maastricht were justified, and that any threat that comes off is to be applauded, for winners always deserve applause and are always supported in the Conservative party.
    There is now a new and helpful situation, in that a threat has been made not just overnight but at an early stage, which gives the Government and commentators an opportunity to investigate the position. Until yesterday, I had not made up my mind about the Bill, but it did not help to be threatened quite so crudely.
    The first question that we must consider is whether the monarch has consented to prorogue Parliament if the Bill is not passed. Of course, it is now customary for the Government to give the impression that they are responsible not to the House but for the House. Many of the Prime Minister's observations at the Mansion House gave the impression that he was responsible for the House of Commons. However, an older view—and perhaps, in our unwritten constitution this old view is out of date—is that the Government are responsible to the legislature.
    There is now a quite extraordinary new constitutional theory, to the effect that, when the Government have entered into some form of foreign obligation which the House of Commons does not support, a general election

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    must be called. In relation to Maastricht, it was at least arguable that the issue had been raised before a general election. When I tried to raise it in my constituency, I was regarded by the media as an oddity and an eccentric. I understand that it was not generally raised during the general election campaign. However, I shall let that small point pass.
    No one can argue that the outcome of the Edinburgh summit has been submitted to the nation. The only place to which an agreement with a foreign organisation can be submitted is this House. When the House is told, "If you disagree with the expenditure of £75 million, there must be a general election," it makes those of us who are Conservatives and Government supporters but who have the misfortune to disagree with extra expenditure in Europe ask, "What is our purpose in this place, and what is the purpose of this place?"
    Surely, in the last resort, the House has always been able to say, "We are sorry, but you cannot have the money." That is what Parliament said to Stuart monarchs, and surely we are entitled to say that to the Government. If we say that, surely we cannot be told that it will precipitate an immediate general election.
    For example, I agree with my right hon. Friend the Member for Guildford (Mr. Howells) about the current movement of economic policy. Since 16 September 1992, economic policy has been good. We could argue about the odd detail here or there, the small points, but in general the policy has been good, and in the next couple of years that will be recognised. It is infinitely superior to any of the interventionist and high-spending policies of the Opposition.
    I do not want to precipitate a general election, but as a Member of Parliament I want to be able to say that I do not wish to see money wasted and spent in Europe. It is disgraceful to threaten the House of Commons in this way so as to deprive us of our rights and emasculate us in our most important role. We argued about the role of the European Community during proceedings on the Maastricht legislation. If, for the sake of argument, we say that we should not have an interventionist industrial policy or whatever, in the last resort the only way to check the extension of federalism is to say that we will not pay for it.
    It is said that the alternative to paying the money is to check fraud in Europe. There is nothing new in the reports from the Court of Auditors. Such highly critical reports have been appearing year in and year out for the past 10 years, and every rising junior Minister comes to the Dispatch Box and says, "This is disgraceful. We must do something about it. The Government will be unrelenting in stopping this."
    That reads very well and gives great pleasure to the speaker of the words. It is noted by the chaps from the Whips Office, and it goes down very well. But, of course, nothing happens. Not only that, but nothing can happen, because Europe is a half-formed federal structure. As the Prime Minister acknowledged in his exchange with my hon. Friend the Member for Northampton, North (Mr. Marlow), if it became a fully federal structure, we would be even more angry about it.
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    Let us look at the present structure. The European Community has some limited control over Governments, but no control over individuals. We all know that the Italian Government are certainly shaky. Without being offensive, I can say that, from time to time, they are suspected of being corrupt. It has now been proved in the European Court that the Italian Government made no attempt whatever to enforce the system of milk quotas. The fine imposed upon the Italian Government by the European court was £700 million.
    It is a federal structure that we ought to be supporting. Along went the Chancellor of the Exchequer, who, with admirable frankness—I understand his language entirely, because I share both his educational and professional background—shrugged his shoulders and said, "When I was appearing in the Birmingham county court, I always knew that it was better from time to time to take half of what you could get rather than go for the lot."
    That is all very well in the Birmingham county court when one is appearing for a plaintiff against a bankrupt defendant, but we were dealing with the most appalling example of fraud and evasion of Community rules by a democratically elected Government who we regarded as a suitable ally and partner within the European Community. It is all very well junior Ministers saying that we are going to do this, that and the other, but when the time came for collecting a bit of money and ensuring that a fraud was stopped, the Chancellor of the Exchequer let them off the hook.
    There is no control over fraudulent individuals in the Community—nor can there be. Those of us who farm—[HON. MEMBERS: "Oh."] The House may consider me particularly awkward about the Community, so let us assume that there are farmers who love the Community and believe it is the best thing in the world. However, if an Italian Euro-inspector of the ewe subsidy came along and said, "Hey Jock, have you got the right number of ewes?" they would resent it very much indeed. It would be a manifestation of an Euro police force. Of course, that will not happen.
    Let us consider the Euro-control of countries. We are not in the same position as the northern states were in relation to the southern states in America. We are not about to send the Army into Milan and say, "Right, you pay the £700 million and don't mess around." It is, I repeat, a half-formed federal structure. The fight against Euro-fraud will always fail. It will always be a very useful subject for rising Ministers to grit their teeth, stick out their chins and look purposeful at the Dispatch Box, while nothing happens.
    The only mechanism for preventing expenditure in Europe of which we disapprove is to allow the House of Commons from time to time to say to the Executive, "We are sorry, but we will not pay up." That is surely what an unemasculated House of Commons should be able to do.
    I suppose that clever people who think that the House of Commons should be no more than a recruiting ground for the Government and have no powers at all, will be proud and pleased at the way in which we have been so successfully threatened, but it will be a sad day for the Government.
    I end with a reminder. I watch with interest what Lady Thatcher says about the European Union, and I can conclude from her publicly stated remarks only that she now regrets that she was responsible for the Single

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    European Act. If she regrets it, it is mainly her own fault, because, contrary to the best traditions of the House, she bashed it through with a guillotine and did not listen to any of the arguments that might have persuaded her that, by her own standards, she was making a serious mistake.
    If we emasculate the House because we think it clever to shut up 10 or 15 people who have a different view about funding the Community by threatening them, we should recall that we may see—I hope we do not—a further interventionist move in Europe. We may see a Labour Government who support it, and we may be bound by the constitutional argument that was put forward yesterday, to the effect that a British Government who have entered into an unwise agreement with foreign bodies cannot have that foreign agreement prevented other than at the cost of a general election.
    This is an unwise attack upon the House of Commons; it is an unwise attack upon our constitutional rights; and I hope that there is good and sufficient discussion of it over the next weeks, so that the Government may realise what a grave mistake they have made.
    6.45 pm
    Mr. Tony Worthington: I shall not follow the same road as the hon. Member for Wolverhampton, South-West (Mr. Budgen) as I want to talk about United Nations peacekeeping forces. We have often been told that there is no place for a UN peacekeeping force in a civil war and that is what we are hearing from the Conservative party.
    As we debate the matter tonight, the UN operation in Somalia is being run down in a spirit of failure—as something that has gone badly wrong. That is serious not just for Somalia but for the whole world.
    Let us go back two years when, because of the background of clan differences, the United Nations passed a resolution agreeing to military intervention, and then failed to do so until seven months later when 500 lightly armed Pakistani troops landed and were immediately captured. In the new year, we had the CNN-filmed invasion of Somalia by the United States, when 20,000 troops went in. We then saw 20,000 troops being withdrawn with their tails between their legs as the United States discovered that it was rather more difficult than they had expected.
    At the moment another 20,000 troops, mainly from the Indian sub-continent, are being withdrawn at great risk to themselves and to the aid workers who are there. There is every sign that the shambles in Somalia will start up again and that there will be warfare between the clans. That need not have occurred. There were better ways to deal with the unrest, but what was needed was prompt and efficient intervention, backed by political will.
    The Foreign Secretary mentioned Rwanda as a example of something which had tested the UN to the limits. He was disappointing in that he gave no sign of what he had learnt from Rwanda. Britain was utterly determined not to be involved, yet today the Foreign Secretary boasted about British involvement because, ultimately, 600 British troops became involved. They did a superb job, but are now being withdrawn. Something must have gone wrong when we were seeking not to be involved, but then became involved and boasted about our involvement.
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    Following the killing of the Rwandan President and Belgian peacekeepers in April, the Security Council cut back the UN presence to 271 troops. We backed that decision, but the world was appalled at the withdrawal from Rwanda and the failure of the UN to operate effectively there. We have witnessed appalling spectacles in a country of 7.2 million people, half of whom have been killed, made refugees or displaced.
    On 13 May, the UN Security Council decided that 5,500 troops should be deployed in Rwanda. It is now six months later. On 7 July, Baroness Chalker wrote to Members of Parliament—two months after the decision—saying that it would be a further 10 weeks before those troops would be fully deployed. I was appalled to think that it would take four months to deploy 5,500 troops when thousands upon thousands of people were dying.
    Baroness Chalker's extra 10 weeks would have taken the deployment date to 10 September, but it is now 17 November. What has happened to the promised deployment of those 5,500 troops? It is still two battalions short. After six months, an Indian battalion and a Zambian battalion are still to be deployed in Rwanda, yet apparently our troops are being withdrawn. In the strange way of UN peacekeeping forces, a contract between the United Nations and the Brown and Root company to provide logistical support has not yet been finalised.
    The problem is not troops—troops are available in the world for peacekeeping operations—but political will and logistical support and command. The Foreign Secretary said nothing about how we would improve that. 'There can never be an effective UN operation anywhere in the world unless that logistical support is provided. Today, the right hon. Gentleman boasted that 565 British troops were deployed in Rwanda. When we last debated the issue in July, our commitment to Rwanda was 50 trucks.
    What fills me with apprehension is that the defeated Rwandan army is now reorganising in Zaire and will resurface. It is disturbing that the UN seems to learn nothing from these operations. The French, rightly or wrongly, proved how quickly they could deploy their forces in Rwanda. They said, "We are going in" and they went in within days. In the Gulf over the summer, Saddam Hussein stirred again and there was no problem about logistics. The UN must be equipped to react. We must stop talking about UN reaction unless we mean it. The problem of logistical support must be solved.
    Almost three years ago, the UN Secretary-General Boutros Boutros-Ghali highlighted the problem and said that the UN had no stock of logistical equipment. It must place orders with manufacturers so that it can get its army moving. He said that Governments should commit themselves to keeping certain equipment on immediate standby and agree to make airlift and sealift capacity immediately available to the UN.
    We must go beyond that to what was called, in "Agenda for Peace", peace enforcement units, which should be immediately available for the UN to deploy. The United Kingdom has to agree that such facilities are available. However, we must go even further beyond that to a UN standing force of people who are recruited to serve the UN and to be available for the UN to deal with issues as they arise. We cannot continue to commit people to peacekeeping forces when it takes seven or eight months for them to be deployed in a constantly deteriorating situation. Over the summer, the Foreign Secretary said that he had put forward some ideas to

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    achieve that. I do not think that he has. The Government have proposed nothing to show how the matter could be dealt with more effectively.
    I was disappointed by the right hon. Gentleman's remarks about arms sales. There was no serious tackling of the issue. He often appears to be Olympian and statesmanlike, but on this issue he descended into run-of-the-mill politics, such as saying that we must think about the workers in the British arms factories. If every statesman in the world took the same approach, no progress would be made. It is a serious problem. Unfortunately, Britain has too great an economic dependence on arms sales. The right hon. Member for Tweeddale, Ettrick and Lauderdale (Sir D. Steel) referred to figures that show an enormous concentration of export credit guarantee facilities for the expansion of arms sales.
    The Foreign Secretary is not credible in his protestations that there are no links between arms sales and British aid. His defence appears to be that he was surprised by the Pergau dam affair—that he would not have made the decision that was made, but that he had to honour commitments given by people before him. He suggested that there was but a brief entanglement of arms sales and aid. I caution the right hon. Gentleman that no one outside the Government is convinced on the Indonesia issue. It is transparent that there has been an expansion of aid to Indonesia at a time when, in all logic, it should have been falling.
    I say that because, first, the number of exceedingly poor people in Indonesia has fallen gratifyingly over the past quarter of a century; secondly, Indonesia's access to international private finance markets is not a problem; and thirdly, according to Government policy, good governance should be a consideration—no one could say that the Indonesian Government are anything other than foul in their dealings with East Timor. What other country or part of the world could anyone name where there is a suspicion that a third of the population has been killed during the past 20 years?
    Mr. Gallie: I accept some of the hon. Gentleman's comments. However, is he really suggesting that no one outside the Government would accept trade in arms with Indonesia? Is he aware of pressure from British Aerospace, which has a factory in my constituency, and which makes no bones of the fact that the arms trade with Indonesia is important to that company both within the United Kingdom and at Prestwick?
    Mr. Worthington: I accept the hon. Gentleman's point, which was made by the Foreign Secretary. What is the logic of the hon. Gentleman's position? It is that he has no moral stance on the sale of arms anywhere in the world. That is not acceptable to the Opposition. The hon. Gentleman would sell arms anywhere, to anyone, at any time. That is not good enough.
    The Secretary of State for Defence (Mr. Malcolm Rifkind): The hon. Gentleman had better be careful when he makes such a claim. Is he aware that the shadow Defence spokesman has publicly supported the sale of arms to Indonesia?
    Mr. Worthington: Yes, I have been here throughout the debate and I heard that point being made earlier. I am surprised that the Secretary of State needs to repeat it.
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    We must consider the issue of arms and aid. It is bad enough selling arms, but to link that with sweeteners and aid is even worse. According to the Secretary of State's own figures, of about 15 major long-term bilateral aid projects funded by the Overseas Development Administration and costing more than £20 million, not one goes to sub-Saharan Africa, not one goes to Africa apart from one to Egypt, but four go to Indonesia. Those are real soft-term loans. Nothing is paid back for a seven-year grace period and the rate is 3.5 per cent. after that. That is a direct linking of arms sales and aid.
    The Foreign Secretary has been visibly bruised by Pergau. He is a man with some decency and honour. It is interesting how much he stands out as a light on the Conservative Benches. He has been bruised by, and feels ashamed about, Pergau. The Foreign Secretary should have another quick look and open all eyes about Indonesia and all other countries. It is not possible to say that arms and aid are not linked.
    We often get into crises and then ask what we can do. The right hon. Member for Tweeddale, Ettrick and Lauderdale mentioned Kenya, with which we have the closest of links. Some ask what are our links with Rwanda, Somalia or Indonesia, but there can be no doubt that we have strong links with Kenya, not only in terms of exports but much more so in terms of traditional links with people.
    The Foreign Secretary has talked about preventive diplomacy. I particularly want to mention Kenya today because President Moi is in the country and I want to express my intense concern about the condition of that country. There is no doubt that President Moi has no commitment to multi-party democracy—rather, it was forced on him by the donors. That has often been admitted. We should be exercising preventive diplomacy in Kenya. Do hon. Members know that about five years ago Britain received 50 applications for refugee status from Kenya, but in the first month of this year we received 800 applications for refugee status? The warning signs are there.
    Baroness Thatcher—not Baroness Thatcher, she is a moment or two down the road—Baroness Chalker referred to the importance of good governance.
    Mr. George Foulkes: That would not be Thatcher.
    Mr. Worthington: I promise my hon. Friend that I am about to mention Baroness Thatcher as well. A fortnight ago in Kenya President Moi opened the £9 million Margaret Thatcher library at Moi university, fulfilling a pledge that she gave in 1987. Beware pledges given by Baroness Thatcher because they come back to haunt one. How many pledges did she give? President Moi opened the Thatcher library—
    Mr. Ernie Ross: One book.
    Mr. Worthington: It is funny that my hon. Friend should say that. President Moi immediately launched a nationwide appeal for books because there were none. There has been a collapse of services within Kenya. Should our aid budget be going into major capital projects in the university sector when it is generally agreed that places such as Kenya desperately need primary and

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    secondary education? Those services are collapsing and the ordinary people of Kenya can no longer afford school fees.
    More important than that, our aid budget says that it is in favour of good governance, but last year university staff in Kenya went on strike for 10 months because they were not allowed to form a staff union. There is no academic freedom in Kenya. No research can be conducted in Kenya without the approval of the President's office. All senior appointments are made by the Government. Academic standards are falling as funding ceases. The average class size is 500 and there is enormous corruption in that section of the economy. The Government control what is taught and who teaches it.
    As the right hon. Member for Tweeddale, Ettrick and Lauderdale said, there is no academic freedom, just as there is no separation of the judicial system from the state system. There is no freedom of association and expression. I was also amazed to find that in Kenya an Opposition Member of Parliament has to have permission to hold any kind of meeting. Such meetings can be stopped by a state functionary. One quote reads:
    "We can no longer meet as academics. When we try to do so we are dispersed by armed police even in the privacy of senior common rooms."
    What demands are we putting on Kenya with regard to human rights? What does the opening of the Margaret Thatcher library at Moi university by President Moi say about the way in which Britain is propping up a regime that we should not be propping up, when what we should be doing is emphasising academic freedom alongside all the other freedoms that we should be encouraging in Kenya and elsewhere?
    It is about time that we got our aid budget on-side with regard to human rights. There is too much going round at the moment about our aid budget being linked with arms sales and repressive regimes. Rather than what it is promoting at the moment, it is about time that we used our aid budget to promote the good and noble in the world.
    7.7 pm
    Dr. Robert Spink: I count it a privilege to be able to contribute to the debate on the Loyal Address. It is also a privilege to follow the hon. Member for Clydebank and Milngavie (Mr. Worthington), who spoke with great force on the UN peacekeeping operations and on wider issues. However, I could not say with honesty that I agree with everything that he said.
    I shall, with permission, review three areas—first, Northern Ireland from the viewpoint of defence; secondly, the European Union from the viewpoint of foreign policy; thirdly, from the viewpoint of defence and foreign policy, a particular and pressing point of conflict in the world which is important to Britain—Cyprus.
    First, on a general note, I congratulate the Government on an excellent Queen's Speech, which could not in any way be called uncontroversial. It outlines a dynamic and ambitious legislative programme, which will build on past successes in the economy, industrial relations, foreign and defence policy, health care and the environment.
    The programme will achieve two important objectives. First, it will continue the improvement of the economy's supply side; secondly, it will build on the far-reaching and successful Conservative social reforms in areas such as pensions, removing discrimination against disabled people
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    and caring for the sick and mentally ill and for genuinely vulnerable people. We live in historic times. Who would have thought that Gerry Adams would be here today, in the mother of Parliaments?
    The solution to the Northern Ireland problem has eluded all Prime Ministers this century, except, I hope, one. When my right hon. Friend the Prime Minister declared last year that Northern Ireland was to be his top priority, I thought that he had stuck his neck out a little too far. Do not get me wrong: I thought that he was absolutely right, but that he was rather brave. We know that the charge of great bravery is one that politicians do not seek when setting policy.
    My right hon. Friend the Prime Minister has made tremendous and historic progress and great credit must go to him personally, above all others. That is not to belittle the important contributions of the hon. Member for Foyle (Mr. Hume), Albert Reynolds and others.
    The Downing street declaration, based firmly on principles of democracy and consent, led directly to the IRA ceasefire on 31 August and to the cessation of loyalist paramilitary operations on 13 October. It promises eventually full-blown peace, notwithstanding the current political crisis in Dublin and the Irish Prime Minister's resignation.
    One key issue to be resolved in Northern Ireland is the future of paramilitary weapons. I urge the Government to continue to pursue a co-ordinated approach with whoever takes power in Dublin in future, to achieve the removal and decommissioning of guns and explosives. I welcome the proposals to pursue a Northern Ireland Assembly and to produce a joint framework document to promote clear and soundly based relationships between the two peoples and Governments. Most of all, I welcome the fact that the constitutional guarantee remains, and will remain, rock solid.
    As my right hon. Friend the Prime Minister told the House yesterday, there are formidable tasks ahead, but each day without violence is another small victory for Northern Ireland. The benefits of peace for the people of Northern Ireland are overwhelming. Right hon. and hon. Members in all parts of the House must wish my right hon. Friend the Prime Minister well in his historic and brave endeavours. All should recognise that his personal strength, quiet determination and foresight have brought about a unique opportunity for lasting peace in Northern Ireland.
    As to foreign policy, I ask my right hon. and learned Friend the Secretary of State for Defence to estimate, when he winds up, the impact on the important Anglo-American alliance of the recent US elections. The people of America voted overwhelmingly for conservatism, less government, lower taxes and less state dependency—for individuals to take greater responsibility for themselves and their families. In a nutshell, America voted for greater freedom and for conservatism. I suspect that that will have a significant impact on America's foreign and defence policy and on the Atlantic alliance.
    I rely on the old adage that what comes to pass in America one year often comes to pass in Britain a year or two later. Britain commands great influence in the world far beyond that which we might expect, given our country's size, industrial prowess or even military might—although man for man, our armed services are the best in world. We exert that influence because of our

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    unique culture, traditions, history, language, and worldwide recognition of the quality and value of our national institutions.
    Britain's special position was not secured and maintained by chance but results from consistent, sound Conservative policy through the 1980s and 1990s, when Labour would have squandered the country's position through nuclear disarmament and other short-sighted and mistaken policies. Labour would have destroyed, or at least threatened, Britain's position as one of the Security Council's five permanent members, through the party's defence, European and international policies.
    Britain's special position is good for the world order. It is a positive international force for stability, democracy and the development of free markets which will lead the world from tyranny and poverty. I despair when Britain's position and status in the world are threatened and continually eroded by a short-sighted and self-indulgent media, often led by one of our greatest institutions—the BBC.
    The media have done great damage to all our major institutions—the monarchy, Church, judiciary, industry and even Parliament. It is truly among the least corrupt Parliaments in the world, but it is derided and denounced by the media as thoroughly corrupt, which it is not. Right hon. and hon. Members in all parts of the House are honourable, even if some are occasionally foolish and forgetful.
    Mr. Peter L. Pike: Despite the hon. Gentleman's remarks about the BBC, does he not agree that the BBC World Service has the finest reputation of any broadcasting service in the world? The hon. Gentleman does the BBC an injustice.
    Dr. Spink: I am indebted to the hon. Gentleman, because I entirely agree that the BBC World Service is one element in Britain's special world status—something which we should cherish but which we often undervalue.
    By damaging Britain's world standing, the media undermine our foreign policy. They are often led by a Labour party that surpasses other political parties only in its ability to denigrate our nation and institutions. That is one reason why socialists remain unsuitable for government.
    At this point, I will cross party political lines and call on the Government to enhance Britain's position and status in the so-called new world order, by taking an early decision to rejoin UNESCO, which would do so much to help world development. The Government should make that positive move, and before the American Government. I ask my right hon. and learned Friend to describe Government policy on UNESCO when he winds up.
    As to Britain's position in the European Union, I am pro the European Economic Community. I voted for it. Unlike Mr. Blair and many Opposition Members, I have been consistent.
    Mr. Deputy Speaker (Mr. Michael Morris): Order. The hon. Gentleman should know the rules of the House by now.
    Dr. Spink: I am grateful for your advice, Mr. Deputy Speaker. Unlike the right hon. Member for Sedgefield (Mr. Blair) and other Opposition Members, I have been
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    consistent in my view of Europe, which focuses on two fundamental benefits. I do not apologise for restating the fundamentals, because they can become lost in the trivia and minutiae. They are worth restating.
    The first great benefit is that Europe has delivered and continues to deliver peace, stability and democracy where they did not exist previously. I would sacrifice almost everything in life before I would sacrifice my three boys on the battlefields of Europe.
    The promotion of peace, stability and democracy are benefits of the European Union that are too little explained, understood, celebrated and valued by right hon. and hon. Members.
    The second benefit is economic. It is measured in terms not of cost alone but of the cost benefits of our membership of the club of Europe, of improved living standards for all people in society—the poor and the better off, young and old alike—and of jobs for workers.
    Our membership of the European Union and our membership fee help to create a more stable Europe which can be a model for, and can influence positively, the stability and development of the wider world. I want that, so I will vote for the European Communities (Finance) Bill. I see relieved expressions among my right hon. Friends on the Government Front Bench. I am sure that my loyalty was never in doubt.
    As for the future development of Europe, I seek an enlarged, deregulated, free-trading economic community—one in which rules are applied equally and fairly in each member nation, and in which fraud is policed equally toughly in all.
    British Conservatives have played a major and positive role in the development of Europe in recent years. It was our Government who introduced budgetary discipline and fraud policing in the first place. We introduced the common agricultural policy reforms, which must go much further. We introduced the single market and enlargement. Those were British Conservative initiatives of which we can be proud.
    My right hon. Friend the Prime Minister rightly recognises that Britain is irrevocably part of Europe and that it should be at the heart of Europe, but it must be a Europe that works, and works well, not a Europe based on the elusive sands of liberal or socialist dogma and ideology. Britain has taken a leading role in setting the European agenda, often saying things that other countries know are right. Quietly, they welcome what we say, but all too often they remain silent and allow us to do the hard work for them. That is as it may be.
    We must look now to the 1996 intergovermental conference, to what we can contribute to that conference and to how we can continue our positive contribution to the development of Europe. My right hon. Friend the Prime Minister must focus on key issues, such as how to establish a fairer voting system, how to develop simpler and more transparent legislative procedures, how the Council can exercise more control over the Commission, how to reduce the unwieldy number of Commissioners, particularly as Europe enlarges, and how to pursue budgetary reform, CAP reform and, indeed, the policing of fraud.
    I now refer to the vexed matter of Cyprus. I restate Britain's special position as a guarantor of the independence of Cyprus. We are one of the guarantor

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    nations. We also have a special position of one of the five permanent members of the United Nations Security Council.
    Mr. Clerides, President of the Republic of Cyprus, held a round of five informal talks with Mr. Denktash, the leader of the Turkish Cypriot community in the northern third of the island of Cyprus. Those talks established beyond doubt two facts: first, that Mr. Denktas espouses and is driven by Turkish policy, not his own; and, secondly, that neither Mr. Denktash nor Turkey currently has the political will required to obtain a solution to the problem of Cyprus. I say "currently", because I hope that the situation will change.
    The facts today are plain: both Mr. Denktash and Turkey reject all the Security Council's resolutions, including paragraph 2 of resolution 939, calling for a solution based on a bi-communal, bi-zonal federation with a single indivisible sovereignty. They are adamant in their demand for recognition of separate sovereignties for each federated component unit, and for recognition of a separate sovereignty for the federal state as well. Those are unrealistic goals. They are without international precedents; they are simply delaying tactics—they cannot succeed. Moreover, Turkey and Mr. Denktash are against Cyprus becoming a member of the European Union.
    The United Nations Secretary-General's definition of political equality has also been rejected by Turkey and Mr. Denktash, as have the treaties of guarantee and alliance as they concern the guarantors and the unilateral right of intervention. They also reject demilitarisation. Responsibility for the failure to make progress, therefore, lies with Turkey and with the Turkish Cypriot leader, Mr. Denktash. The Security Council should now take specific and pragmatic measures against the side that flouts its resolutions and frustrates the proper and equitable solution of the problem of Cyprus.
    Progress can be made only if there is a change of attitude by Turkey on the key issues, in particular on sovereignty, demilitarisation, and the accession of Cyprus to the European Union. Therefore, I end by asking the Government now to consider promoting an international conference to move the issue forward. I ask Her Majesty's Government to do everything possible in the fast-coming talks to establish a timetable for Cyprus's accession to the European Union.
    7.26 pm
    Mr. William Ross: The hon. Member for Wolverhampton, South-West (Mr. Budgen) made an interesting speech, which was quite in keeping with the views that he and the former hon. Member for his constituency, Mr. Enoch Powell, have often expressed. Whenever I listen to the hon. Member for Wolverhampton, South-West, I think that there must be something in the air in his constituency, of which I fully approve in general terms.
    The hon. Member for Wolverhampton, South-West and the hon. Member for Castle Point (Dr. Spink) referred briefly to the situation in the Irish Republic. Of course, that is the only country with which we have a land frontier, so perhaps the House will expect me to speak about the situation there. However, what is happening there is a private grief which those involved should sort out; it is not the business of Members of the House of Commons. We should sympathise and hope that they shortly find a way out of their problems. Perhaps some
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    folk in the Irish Republic now think that the Act of Union was not a totally bad idea. One hopes that, one day, the foolishness of the teens and twenties of this century will be reversed.
    The right hon. Member for Tweeddale, Ettrick and Lauderdale (Sir D. Steel) and other hon. Members said that we should try to pre-empt violence, and he referred in particular to places such as Rwanda. Although on the surface that seems a good idea, we need to decide whether armed intervention—that is what has been talked about—is needed, how it would be implemented and by whom, whether armed forces should wait until they are invited in, or whether they will have to fight their way in. When one considers the dangers involved in that, one realises that the matter is not as easy, simple or swift as some folk seem to think. Like many good ideas, it founders on the rock of reality.
    The hon. Member for Livingston (Mr. Cook) talked about three major trading blocs dominating the world over the next few years. He was corrected to some extent by the right hon. Member for Guildford (Mr. Howell), who drew attention to the various forces which are moving toward international trade, and therefore to far freer associations of trading nations rather than three large fixed blocs. If they ever came into being, they would be mutually antagonistic and would pose grave dangers to world peace. I support those who seek a steadily expanding volume of trade across the board. The general agreement on tariffs and trade is a large step in that direction.
    I found the rest of the speech of the right hon. Member for Guildford somewhat depressing. He talked about the great eastern economies which would dominate the world for the next 20 to 30 years. He betrayed a pessimism about his nation which no hon. Member should exhibit. We should encourage our people and do what we can in this place to create a framework that will enable us to flourish and restore our position as far as humanly possible in the world.
    In the Gracious Speech, the Government restated, among other things, their objective of a balanced budget. I hope that that will shortly occur, and that we will then move beyond that happy position and once more be able to repay debt, not least that which is piling up from previous years and the current year, and that which will pile up in the next two or three years.
    I also listened with care when the right hon. Member for Guildford explained how well the United Kingdom was doing. Regrettably, when I asked him the reasons, he did not seem able to give them. The answer was supplied by the hon. Member for Wolverhampton, South-West, when he referred to the happy events of 16 September 1992. That was the day on which the Government and the Treasury had to come to terms with the reality of fixed exchange rates.
    Although there was much breast-beating, and sackcloth and ashes were much in evidence, we have seen the benefits of abandoning fixed exchange rates ever since. The Government were driven by the events of that day to go back to a floating pound. Indeed, the former Chancellor of the Exchequer had to re-create his policy on that day.
    From that day to this, there has been a steady move to the happier position which the right hon. Member for Guildford described. He seemed unable to bring himself

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    to say that the desertion of fixed exchange rates and the evils that flow from them led to the present position. Unless and until the House, and especially the Treasury team, understands that, we are in danger of getting back into the difficulties that led to 16 September. Perhaps the Government are moving in that direction.
    The economy is steadily improving in a very fine way, as the right hon. Member for Guildford said today, and the Prime Minister said yesterday. In the light of that, the blunt statement that the Government will continue to pursue their firm financial policies is welcome. If we really care about the future of our country, we should all support the Government in those firm policies. However, such firm policies imply a measure of pain from time to time. As we are a member of the European Union, firm financial policies must be applied somewhat more widely than in the United Kingdom alone.
    We are told that, out of the total spend of the European Community, anything up to £6 billion disappears in fraudulent exercises. That is a fantastic sum of money. It is a maximum of some 10 per cent. of the total—no one really knows the exact figure. If no one knows what is being lost in fraud, it tells us an awful lot of nasty things about the systems of book-keeping that are being used.
    We must improve either the systems of book-keeping or the system by which the cash is dispensed in the first place. Budgetary discipline and elimination of fraud are a vital component of our membership of the EU. Budgetary discipline has been evident only in the sense that it has been so evidently missing.
    There was a debate on fraud in the other place on 31 October. Those who have not read it should cast their eye over it. They will find an appalling litany of fraud and corruption and sleazy deals. Some of those sleazy deals reached the point at which the British Government were blackmailed by other members of the Community. For example, the milk quotas of Italy and Spain were increased. Yet Britain is short of milk quota. Our farmers are crying out for more quota. Instead of receiving more, our quota seems to go steadily down. That is a matter to which the Government could profitably direct their attention.
    As one speaker in the debate in another place put it bluntly, there appears to be gross negligence in the way in which EC grants are handled. It is more than gross negligence. The system is so complex that it is almost impossible for anyone to understand it even if they want to. Many of the people who benefit from the fraud are not too anxious to find out what is going wrong. The system is complex, because so many different state systems are involved.
    The Government spokesman in another place said:
    "The responsibility for detecting and prosecuting fraud remains, nevertheless, with the member states."—[Official Report, House of Lords, 31 October 1994; Vol.558, c. 746.]
    That may well be so, but I draw it to the attention of the House—if that is necessary—that most of those states are net beneficiaries of EC funds. Who has heard of any Government being hard on their people for plundering a pork barrel that was constantly filled by someone else—in this case, Britain and one or two other nations? Such a system does not lend itself to easy reform. If the facts are
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    as stated in the reports given to the nation in the debate in the other place, the idea that the EU can be corrected by good housekeeping is wide of the mark.
    It is a matter of fact and of interest that the same Minister I quoted in another place praised United Kingdom Ministry of Agriculture officials for their work. It is also noteworthy that Britain has a fairly high detection rate. Of course, that may mean that there is a lot of fraud here, but it is more likely to mean that a much higher percentage of fraud was detected in the United Kingdom than in other countries because our systems are efficient. I believe that another reason is that Britain is a net contributor to the pork barrel, so our Government were rather more anxious than others to ensure that fraud was diminished as much as possible.
    It is also a fact of life that the same officials and their predecessors have always policed the United Kingdom agricultural schemes. I should have thought that that had a great deal to do with their success. The fraud detection system in Europe has been bad, and it is getting worse. It will deteriorate further as more nations join. Therefore, it is essential that all systems should be improved. Tinkering will not cure the problem. Everyone who has touched on that subject today and in the other place has said exactly the same. If we are to deal with it, we must create a system which devolves more responsibility to national Governments. Perhaps subsidiarity is the buzz word.
    National Government would not be tied to economic, bureaucratic EC rules. A block grant system might be used. Spending would he better looked after, as Governments would be spending their own money. If the money did not go to those to whom the economic union had designated it, the internal democratic system in the various states would ensure that it did, so there would be far less fraud.
    A harvest is there to be reaped between now and the fulfilment of the Government's commitment to own resources. That change needs to be carried into effect to ensure that this and future Governments of whatever party—that depends on the will of the electorate—are not severely embarrassed over the size of our commitment in the next few years.
    7.39 pm
    Mr. Christopher Gill: It is a pleasure to follow such a respected Member of the House as the hon. Member for Londonderry, East (Mr. Ross), who was kind enough to refer in glowing terms to my home town. I was born and bred in Wolverhampton. The hon. Gentleman also referred to my hon. Friend the Member for Wolverhampton, South-West (Mr. Budgen) and to Enoch Powell. It might interest the hon. Gentleman to know that Wolverhampton's motto is, "Out of darkness cometh light." That might help to explain why he has heard such good sense from my hon. Friend the Member for Wolverhampton, South-West and his predecessor, the right hon. Enoch Powell, on so many occasions.
    Dr. Goodson-Wickes: And from you.
    Mr. Gill: How kind.
    In June, I visited Stockholm and had the opportunity to talk to members of the Swedish Parliament. I asked one for his view of the prospect of Sweden entering the European Union. Without a moment's hesitation he told me, "The political classes are all in favour." That was an

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    exceptionally arrogant remark, as it seemed to leave out of the reckoning the people who elected that man to Parliament.
    My hon. Friend the Member for Wolverhampton, South-West spoke well tonight. His was an incisive and challenging speech, which reminded us of an important question that all hon. Members should be asking themselves. He said that we were in great danger of turning the House into a rubber stamp to do the bidding of the Executive. I agree that it seems that no amount of reason, argument, debate or common sense will persuade the Government to allow those considerations to weigh most heavily.
    My hon. Friend the Member for Wolverhampton, South-West instanced how the Single European Act and the Maastricht treaty were rammed through the House, in the first instance on a guillotine motion and on the second as a result of a vote of confidence. It is a very bad time for democracy when a measure that does not command the people's wholehearted support is put through the House in such a manner.
    I remind hon. Members that, not merely in Sweden but in the other countries that held referendums on the subject, the margin in favour of joining the Union was very slender. Many of us regret the fact that although Ministers support referendums for African countries—now they even support one in part of the United Kingdom—they do not support a national referendum on the most important constitutional issue of my lifetime, and I am old enough to remember the war. It is unfortunate, to say the least, that politicians are prepared to treat the electorate with such apparent indifference.
    I think that many of my colleagues privately realise, as I do, that that great endeavour can never be completely successful unless we take the people with us. I am reminded of what the former Member for Wolverhampton, South-West told me a few weeks ago: never forget that in the end the people will win. That is timely advice for my party and the Government. They may feel that so many of the things that they want to do to progress the European adventure can be pushed through the House on a guillotine or a vote of confidence and that there will be no reaction. There will be a reaction. Ultimately, the electorate will have the last laugh.
    I hope that the leaders of the Conservative party have seriously calculated the effect on our electoral prospects of pushing the European Communities (Finance) Bill through the House on a vote of confidence, in the same way as they pushed through the Maastricht treaty and the Single European Act.
    On the financial implications of the Bill, the Gracious Speech states:
    "Legislation will be introduced to give force to the changes in the European Communities' system of own resources".
    Barely five lines later, we read:
    "Fiscal policy will continue to be set to bring the budget deficit back towards balance".
    There appears to be a contradiction in terms. If the priority is to bring the budget into balance, surely one must consider carefully before committing oneself to additional expenditure.
    My hon. Friend the Member for Wolverhampton, South-West said that perhaps hon. Members did not think that £75 million was a huge sum. It seems that when it involves something that the Government want to do, it is
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    never a huge sum; when it involves something that our constituents or we Back Benchers want, it is always a huge sum.
    Surely we must ask ourselves whether we can afford that Bill. Estimates of how much it will cost vary and I shall quote only one figure. At present, the British taxpayer is paying the equivalent of 3.4p on income tax to Europe. By 1999, it will have risen to 5.4p in the pound. That may be fine for some of our constituents, but I represent Ludlow in the county of Shropshire, which ranks 11th lowest in the country for male wages and second lowest for female wages. When we talk of spending another £75 million on the European budget, I am mindful of the fact that that money will have to be found from our constituents. Everyone pays. There is no way for any of our constituents to avoid paying. Perhaps some of them avoid paying income tax because of their low earnings, but everyone will pay because no one can avoid indirect taxation. The fact remains that everyone in the land will have to contribute in one form or another to that extra sum of money for the European budget.
    The benefits are advertised by those who are in favour of European political and monetary union. I hear people from our own country saying how wonderful it is that European money is going to pay for good things in their constituencies. I am always at pains to remind those people that those good things in their constituencies are not being paid for by anybody other than themselves.
    In point of fact, were that money not sent to Brussels in the first place, there would be more money in the pot in the United Kingdom to pay for those good things. As that money progresses from Whitehall to Brussels—and as we then go cap in hand to bring it back again—it has become a smaller sum because of the administration and the bureaucracy.
    Dr. Spink: Is not my hon. Friend making an over-simplistic argument? Is not our general prosperity dependent on our membership of the European Union? Are not there wider benefits to be derived from our membership?
    Mr. Gill: That is an old canard. People who wish to oppose my point of view portray me as being against Europe. I am not against it; I am favour of the Common Market as are the majority of my constituents. When they voted in 1975, the majority of my constituents and, I submit, the majority of the constituents of my hon. Friend the Member for Castle Point (Dr. Spink) voted in favour of the Common Market. But they did not vote for—and they were told at the time that they would not get—political and monetary union. That is what I, and some colleagues, find difficult to forget.
    Dr. Spink rose—
    Mr. Gill: I know that my hon. Friend is tempting me to engage in further arguments, and I should like to give him that opportunity.
    Mr. Budgen rose—
    Mr. Gill: I see that another of my hon. Friends wishes to intervene.
    Mr. Budgen: Will my hon. Friend comment on the humiliating position of Hong Kong in relation to China and the surrounding countries? I am sure that he would agree that it is plain that Hong Kong is about to become

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    bankrupt. It is not part of a political union with surrounding countries, it does not have monetary union and it does not have its laws made by surrounding countries. Is not it plain that disaster is about to descend on Hong Kong?
    Mr. Gill: My hon. Friend tempts me to talk about the highly successful economies around the world which have no affiliation with any other country and which are not in federal structures. Those include stand-alone economies such as Japan and, as my hon. Friend mentioned, Hong Kong and many others.
    I meet industrialists from this country who say, "Just give us the tools and we will do the job." They say that they do not need to be in a political or monetary union with other countries in Europe, and that they just want to get on with earning a living in the world, which they are capable of doing.
    Of course, it is an historical fact that we have earned more of our wealth in other parts of the world than in Europe. People who are opposed to my view say that we do 60 per cent. of our business in Europe. That may be true, but we are only doing that business with 6 per cent. of the world's population. I do not know of any business man who would think that that was a satisfactory customer profile. Any business man worth his salt would think, "If I am only doing 60 per cent. of my business with 6 per cent. of the world's population, have I spread my risk far enough or cast my net wide enough? Are there not other markets which I could attack?" He would be absolutely right to say that.
    My hon. Friend's intervention reminds me that he—more than anybody in the House—knows what I previously did for a living. While I am talking about the financing of the European Community and questioning whether we can afford it, I shall tell the House about something of which I became aware only a few weeks ago. It is a project funded by the European Union to investigate ham automated monitoring systems, and to carry out this HAMS project, as it is called, the European Community will finance the university of the West of England to the tune of £500,000.
    Four generations of my family have made ham in Wolverhampton. My father and I were quite content to produce hams to the best of our abilities by using skills which were handed down from generation to generation. If a ham was substandard, it would be returned by the customer and we accepted that we might offend or lose that customer. That is what I still believe in, and it is what my son is still practising. I do not think that it is any part of the European taxpayer's duty or responsibility to give £500,000 of taxpayers' money to the university of the West of England to do something that is purely and exclusively a function of the commercial sector.
    Mr. Budgen: My hon. Friend and I are old men, and we are among the last of the people who did national service—my hon. Friend served in the Navy. To help
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    many Conservative Members, will he explain how it is that we are preventing a third European war by giving subsidies to undercut him in the ham trade?
    Mr. Gill: My hon. Friend poses a challenging question, and I shall do my best to answer him in a moment.
    Mr. Deputy Speaker: Order. When the hon. Gentleman does answer, I hope that he will relate it to the Gracious Speech.
    Mr. Gill: My remarks are in relation to that part of the Gracious Speech which refers to the European Communities (Finance) Bill, which is to be considered by the House a week on Monday.
    My hon. Friend the Member for Wolverhampton, South-West made an incisive and challenging speech. I know, as he knows, that many of the challenges which he laid down in that speech will never be answered, not least because there are no answers which the Government can honestly provide to some of the questions he asked.
    That, I am afraid, has been a feature of our debates on Europe. My hon. Friend and others have made the arguments and we have won the arguments, but unfortunately we have too often lost the vote. My hon. Friend and I would be only too pleased to have a vigorous and lively debate, and then conclude that debate by voting on whether the arguments which we advanced were compelling and whether the House accepted them, but that is not to be. We will not decide the matter on the balance or the strengths of the arguments deployed by the likes of my hon. Friend. The argument will be decided by a vote of confidence put forward by the Government, and I regret that very much.
    My hon. Friend asked in his intervention how war would be prevented by spending £500,000 on investigating how better to cure hams. My answer is that that £500,000 has been diverted to the university of the West of England for the HAMS project at the expense of the defence budget. I am pleased to see my right hon. and learned Friend the Secretary of State for Defence on the Treasury Bench. He has had the doubtful distinction of having to tell the House about regiments having to be disbanded, about aircraft of the Royal Air Force having to be grounded and about the acceleration of the programme for the disposal of ships.
    That is the reality. We are prepared to spend a lot of money for no tangible return, but we are expected to buy the vital defence insurance policy that our country needs to maintain with a smaller and smaller premium each year. I agree with my hon. Friend that that is absurd.
    Will all the partners ever be equal in the great endeavour that we are trying to create in Europe? I put it to the House that it is highly unlikely that the partnership will ever be an equal one. There may 12, 16 or even 20 partners, but there will always be a pecking order and inequality among the partners. The reality, whether we care to accept it or not, will be that the country to dominate in the Community will be that which has the biggest stick or the deepest pocket. On present performance, that country, sadly, will not be the United Kingdom. That is why we saw the recent humiliation of our own Commissioner, Sir Leon Brittan, who wanted a high-profile office, but who was severely disappointed because the Germans decided that they would rather give that office to their friends and neighbours, the Dutch.

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    That decision was quite understandable. The Dutch want to keep on the right side of the Germans, not least because they do a lot of business with Germany, which is the immediate neighbour of their small country. The Dutch consider that the potential that their economy has to offer will be far greater if they keep within the slipstream of the German economy than if they stay outside of it. Therefore, Germany looked after the Dutch and did not look after Britain, thus disappointing Sir Leon.
    I worry when I see my country going around almost cap in hand to the Commission and the Council of Ministers to get whatever crumbs it can from their tables. That brings me back to the intervention of my hon. Friend the Member for Wolverhampton, South-West. I agree with him that this country could stand on its own if it wanted to. It is resourceful, inventive and industrious. We have always looked to the world, where we have created so much of our wealth and made so much of our history. We ignore that at our peril.
    8.2 pm
    Mr. Ernie Ross: If the hon. Member for Ludlow (Mr. Gill) does not mind, I will leave Europe for other colleagues to discuss. I am sure that my hon. Friend the Member for Ilford, South (Mr. Gapes) will correct the misconceptions that the hon. Gentleman put forward, should he catch your eye, Mr. Deputy Speaker.
    The area that concerns me most is the middle east. The Gracious Speech referred to the Government's continued support for the middle east peace process. Everyone involved in that process is to be congratulated on the success achieved so far. I say "so far", but we have already not only had the initial Madrid conference and the active participation of the Norwegians behind the scenes to bring the Palestinians and the Israelis—they always have been the core of the middle eastern problem—together, but the successful declaration of principles and the signing of an initial peace deal between the Israelis and the Palestinians a year ago in September, on the lawn of the White House.
    Since that declaration, we have had further declarations of principles in Cairo and in Washington. It is now time to review the middle east peace process to see exactly where it has reached. Success has been achieved, but on some issues there has been no meeting of minds and on others apparent success has proved false on the ground.
    The most recent agreement between Israel and Jordan is welcome. If the Israelis were able to participate in this debate, they would be the first to admit that it was the easiest peace agreement for their country to sign. It involved no major difficulties concerning land, borders or refugees, but nevertheless it is a welcome agreement. We wish everyone who participated in it good will and we hope to play our part in maintaining the agreement.
    The outstanding countries with which the Israeli Government must have direct, bilateral agreements are Syria and Lebanon. Anyone who understands the middle east will appreciate that an agreement with Lebanon is unlikely unless and until there is an agreement between Israel and Syria. Judging from the statements made by people on both sides, there appears to be little between Israel and Syria, but no peace deal has been signed. It is worth hon. Members considering why that is so, because the principles involved are similar to those that govern events in other areas that have been discussed today.
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    President Assad of Syria has made it quite clear that he would offer Israel full peace for full withdrawal. The Israeli Government responded by saying that the depth of the peace would be equal to the depth of the withdrawal. It seems that the two sides are saying the same thing, but there is still a gulf between them. As yet, no hands have been shaken and no accord has been signed. I have sought to discover from both sides the difficulties that lie behind the failure to reach an agreement.
    It seems that one of the major problems facing a possible Syrian-Israeli peace agreement is the role of Saddam Hussein and Iraq. Part of the depth of the peace being equal to the depth of the withdrawal relates to the desire of the Israeli Government not only to have a peace deal through which people will meet, but one which leads to a substantial reduction in Syrian military personnel and military equipment. Equally, although Syria wants a peace deal with Israel and wants the Golan Heights back, it is concerned about what Israel may want in return. The Syrians know that when the Israelis talk about the depth of the peace being equal to the depth of the withdrawal, they mean the size of the forces that Syria will need to maintain within its borders.

    One need only look at the role of Saddam Hussein in Iraq to understand Syria's problem. Although Saddam Hussein suffered defeats during the Gulf war, he was still able to threaten Kuwait recently. That led to the United Kingdom, the United States and others having to assemble their military forces in Kuwait quickly. That was aimed at deterring Saddam Hussein from taking further action because that would have resulted in action on our part in response, or, if he had not withdrawn, perhaps before he made any further moves. That gives some idea of the Syrians' concerns about the activities of the war machiine that Saddam Hussein still maintains.
    Those hon. Members who argue that the sanctions against Iraq should be eased have not taken on board the fact that not only does Saddam Hussein need to meet all the requirements of UN Security Council resolutions and decisions, but he has to make it clear that, despite the huge military forces with which, despite defeats, he is still able to threaten another Arab state, he is willing to enter into dialogue about the future use of his military forces. If we can concentrate on that issue, it might help the Syrians and Israelis to get together and make real peace in that area.
    Like the hon. Member for Bexleyheath (Mr. Townsend), I wish to discuss the role of the middle east peace process in relation to the Israeli-Palestine question. Clearly, everyone is happy to see progress towards resolving the bitter conflict in the middle east. But there comes a time when we must step back and consider what has been achieved so far and whether the process has met all the aims and aspirations that both sides and the world community intended and hoped from it.
    The promising and necessary economic revival has yet to start in Gaza. The "economic dividend" of peace and human rights has yet to be demonstrated to the Palestinian Gazans. There have certainly been no human rights dividends. Israel continues to expand its settlements in and around Jerusalem and the west bank. It maintains settlements in Gaza, continues to imprison and torture Palestinians, and still carries out summary executions on the streets of the west bank. Those actions and delays at

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    every stage do little to build confidence. The latest delay is on the calling of elections for a Palestine national authority.
    Those who visit the west bank and Gaza see a sapping of the Palestine population's morale. They witness a weariness and a draining away of optimism. We have a responsibility to rebuild optimism and show the people concerned that the peace process is important to the Palestinians.
    In this debate tonight, we can make it clear that, as high contracting parties to the fourth Geneva convention, we stand foursquare behind our obligations on human rights and international law. The last time the Security Council voted on that subject was on Security Council resolution No. 904, tabled in response to the Hebron massacre. At that time, the United States abstained on the paragraph that referred to the applicability of the fourth Geneva convention and the need to consider measures of international protection throughout the territories occupied by Israel.
    It is now reported that the United States is actively pursuing a programme of action, supported by Israel at the General Assembly, in an effort to eliminate contentious resolutions. It is not rational to imagine that undermining an international legal consensus by seeking to remove all mention of those rights from a forum where they should be mentioned under the terms of the UN charter would build confidence in the peace process. Nor does it build confidence when the impression is given that the states that are meant to guarantee those rights, which includes Britain, will step quietly aside and allow them to be overridden, leaving only the balance of power—the old "might is right" rule instead of the rule of law and international principle—to decide matters between the Palestinians and Israelis. It does not build confidence when the impression is given that, ultimately, the peace process in which the Palestinians are now asked to place their trust holds no guarantees that they will realise rights which the international community has for so long and so firmly affirmed.
    That is why I am anxious for a reassurance from the Government that Britain, along with its European partners, will continue to uphold the applicability of the fourth Geneva convention to the occupied territories and that Britain will, neither by implication nor omission, give the impression that we are withdrawing support from that long-held position. As everyone in the House knows, if we did so the Palestinians' ability to negotiate successfully in pursuit of their self-determination would be critically undermined.
    The BBC World Service broadcast, "Monitor", on 16 November translated a report from the Voice of Palestine radio in Jericho, which said:
    "In accordance with the agreement that was reached during the Palestinian-Israeli higher liaison committee meeting in Cairo at the end of last month, 400 international observers will be deployed in the Gaza Strip in the next few days."
    Those international observers are a direct result of Security Council resolution No. 904. They are supposed to monitor the activities of the Palestinians and Israelis in the period leading up to the elections in Gaza, Jericho and the west bank. The agreement was signed by Dr. Nabil
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    Sha'th, Minister of Planning and International Co-operation, and Shimon Peres, the Israel Minister of Foreign Affairs. The report continued:
    "the international protection force in the Gaza Strip will be responsible for monitoring the situation and submitting reports to the parties on any violations by the Israeli or Palestinian sides. This force will also work to enhance dialogue in the region."
    At the last Foreign Affairs Question Time, I specifically asked whether the Foreign and Commonwealth Office would consider carefully European Union participation in any temporary international presence in the west bank and Gaza, if those elections took place. The Palestinians and the international community could only be disappointed in the outcome of the temporary international presence in Hebron, which ended up being protected by the Palestinian people rather than monitoring the Israelis' activities. It became a standing joke that, whenever trouble started, the Palestinians' main job was to protect the temporary international presence.
    Although the Israelis and Palestinians have agreed on the presence of those 400 international observers, no discussion has yet taken place with the European Union on our participation, although some members of the European Union are liable to take part. Although a formal invitation has not yet arrived, I hope that an emergency middle east working group will be set up within the European Union so that we can seek to input into those discussions a European Union commitment to support an effective operational mandate for the temporary international presence, including reporting and applying the standards of international humanitarian and human rights law. I hope that the Foreign Office is prepared to take that on board.
    I shall not say too much more on the middle east peace process except that it is at a delicate and critical stage. The Minister of State said that he wanted the elections to be successful and take place as quickly as possible. So do the Palestinians, and it is important that the elections take place quickly, if only to give democratic legitimacy to the Palestinian authority on the west bank and in Gaza and Jericho. I hope that the Palestinian elections will take place in an atmosphere that conforms to what we would expect in normal parliamentary elections. People from all parts of the Palestinian community should be allowed to promote their ideas, argue for their manifestos, whatever those might be, and be allowed free movement during the elections. I hope that the elections themselves are successful.
    I shall now refer to one or two matters that were mentioned by my hon. and right hon. Friends, and comment on some of the proposals that were made by other hon. Members.
    Several right hon. and hon. Members on both sides of the House referred to Indonesia. It is important that we continue to make it clear that, in spite of international condemnation, the Indonesians continue brutally to occupy East Timor. In spite of all the assurances that we have had, everyone else, including Amnesty International, seems to believe that the British Government have got it wrong—the Indonesian authorities are using the British-made Hawk aircraft in attacks against the Timorese people.
    It is important that we make it clear to the Government, and to hon. Members who are obviously worried about the impact that the sale of defence equipment might have on their constituents, that we need to separate the

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    legitimate right of a Government to arm themselves to protect themselves, and our right to sell them those arms to be used for the legitimate protection of that country and its borders, from the use of that equipment—if we sell it to them—by that Government against people who are unable to defend themselves, and who are arguing only for self-determination, which was taken away from them by the Indonesians without any discussion with the international community.
    If the hon. Member for Ayr (Mr. Gallie) is about to jump up to defend his constituents, may I say to him that I would prefer the workers in Ayr to sell more Jetstream 41 aircraft, and he will certainly have my support in campaigning for, and pushing, that good aircraft as a means of helping people to communicate and move around their countries, rather than the use of equipment that can bring death and destruction to innocent people in different parts of the world.
    I shall briefly discuss another country that I mentioned in the previous foreign affairs debate—Cuba. I pay a compliment to the Government. During the United Nations General Assembly's discussion of the US economic embargo, to which the UN General Assembly recently affirmed its opposition, a United Kingdom Minister was due to go to Cuba. We all know the pressure that was put on the Government for that visit not to go ahead, and it is to the credit of the Foreign Secretary, his colleagues and the President of the Board of Trade that that visit went ahead. By all accounts, it was successful, and it is to be hoped that trade will come to this country as a result.
    I am worried about the determination of the United States to maintain the embargo against Cuba. It is just plain daft. It is time for the Americans to bury the Bay of Pigs and the missile crisis, which are in the past, and to understand that there is increasing evidence of internal change in Cuba. There is movement towards an internal market and private ownership. There is increased trade with Europe and the far east. The discovery of oil is leading to exploration contracts with Canada. Tourism is increasing.
    We should say to the Americans that they should accept that it is time to let Cuba into the real world and that all those things are in the past, and that, if we think that they are wrong, we are more likely to convince the Cubans that they should change policies by trade, tourism and cultural exchanges. The United States should at least consider opening up the democratic processes in Cuba.
    I know that you are anxious to make progress, Mr. Deputy Speaker, but I wish to make one last comment, about Turkey. It is important. I know that one of my hon. Friends would have mentioned Turkey, had he managed to catch your eye, but it would be wrong if we did not mention Turkey tonight. The hon. Member for Ludlow (Mr. Gill) referred to the role of Turkey in Cyprus; Turkey continues to cause serious alarm elsewhere in the region.
    The arrest and trial of leading political figures from Turkish Kurdistan accused of treason and sponsoring acts of terrorism has done little to improve Turkey's image in the world. Undoubtedly, there is a genuine campaign of terror by separatist Kurds in southern Turkey. However, the response of the Government in imprisoning democratically elected representatives seeking to defend minority rights in Parliament can only create increased tension in the region and international criticism by human rights campaigners.
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    We should make it clear tonight that we are not prepared to have any form of relationship with a country that is prepared to lock up democratically elected members of Parliament who are simply arguing for the minority rights that they were elected to Parliament to support.
    8.25 pm
    Dr. Charles Goodson-Wickes: I shall follow some of the arguments made by the hon. Member for Dundee, West (Mr. Ross) in my remarks, which will broadly concentrate on those parts of the Gracious Speech that refer to foreign affairs matters.
    I doubt that anyone in the House could have expected to witness three remarkable events in the past five years; first, the collapse of the Berlin wall and the Soviet empire, secondly, the disintegration of apartheid followed by democratic elections in South Africa; and, thirdly, major progress in the middle east peace process. What a remarkable trio of events.
    The previous situations represented much misery in the aftermath of the second world war, and I hope that they can give us hope, notwithstanding tragic regions of instability around the world.
    I welcome, in the Gracious Speech, recognition of the need for the United Nations to enhance its peacekeeping and preventative diplomacy capabilities, but it is difficult to envisage that happening in the absence of a proper military command structure—the North Atlantic Treaty Organisation has often had to do the United Nations' work for it—and in the context of member nations who do not see fit to pay their dues to the UN. I suggest to the House that the best celebration of the 50th anniversary of the United Nations would be for the member nations to take a more positive attitude in those matters, which is a theme that I shall develop on other occasions.
    South Africa is a country that I know well, and have visited often. I have lived and worked in hospitals there, and I applaud the courage and personal standing of two remarkable men who made peace possible in that region. President Mandela has received well-deserved praise for an extraordinary life. Perhaps former President de Klerk has not received the recognition that he deserves. I know the verkrampte Afrikaner population well, and know how difficult it was for him to deliver the return of civilisation to South Africa.
    I hope that history will also record the United Kingdcm Government's role in influencing change in the years when the Republic was outside the Commonwealth, often in the face of British companies leaving South Africa—I think to their moral shame, because I believe that many of those British companies were a force for good in the region, but they decided that it was a sinking ship and they had better leave it pretty quickly.
    During those years, the continuing presence of the Union Flag on the South African flag symbolised this country's continuing moral obligations to that country. I believe that there were several distinguished British diplomats, and I hope that it is not improper to name Sir Robin Renwick as one of those who played an important part in bringing about change for good.

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    I now turn to Hong Kong. Obviously, the Government have done much to protect the people in that territory until 1997. There has been reference in the debate to a boom at a rate that it is difficult to comprehend in this part of the world. Any loss of confidence could still prejudice that.
    I have always doubted the wisdom of tweaking the tail of the Chinese tiger in the interim period as it must be for the ultimate good, both of Hong Kong and China, especially in the era that will follow the death of Mr. Deng, for the two countries to work together. It is all very well to bring about moves to entrench and expand democracy in Hong Kong, but that is all too often misinterpreted by China. I hope that my right hon. Friend the Minister of State and his colleagues will ensure that such misunderstandings do not get out of all proportion in future relationships between Hong Kong and China.
    The middle east has been well served by statesmanship after decades of strife. It is hardly surprising that this country should harbour reservations about the past activities of Begin and Arafat. As with Rabin and Sadat in their different eras, peace has finally prevailed. Once again the United Kingdom Government have played their part. To echo the remarks of the hon. Member for Dundee, West (Mr. Ross), I am sure that everyone in the House hopes that Syria will soon come to the table. We know the sensitivity surrounding the Golan Heights. I have an uneasy feeling that it will need American forces to police that area during any transitional peace settlement. It would be much more appropriate if United Nation forces fulfilled that role.
    Having welcomed the overdue lifting of the arms embargo on Israel, I lead on to the subject of Indonesia, which has caused a fair amount of friction in the Chamber today. I recognise the moral, legal and practical issues involved in the subject of arms sales. My right hon. Friend the Foreign Secretary touched on that issue earlier today. While it is obviously ludicrous to sell arms to one's enemies, it must be sensible to sell arms to well-established democratic allies and to neutral powers with a genuinely sound democratic and human rights record. There will always be grey areas and I think that Indonesia fits into that category. I should like to declare my interest: I visited that country for three weeks during the summer recess. I was sponsored by the Indonesian Government, but had the blessing of the Foreign and Commonwealth Office.
    Indonesia is a strange country. It is not widely known that it is the largest Muslim country in the world. It practises marked religious tolerance and there is virtually no fundamentalist Muslim feeling in the country. It is also the fifth-largest country in the world, with a wider east-west span than the United States. The economy is booming and the standard of living rising in that exciting region of the world, whose influence is ever-increasing.
    I accept that I am beginning to sound like an apologist for Indonesia but I shall now say that its human rights record leaves much to be desired—
    Mr. Ernie Ross: Hear, hear.
    Dr. Goodson-Wickes: I hear someone saying "Hear, hear"—it comes ill from the Opposition to criticise in that way when we have established today that the last Labour Government sold Hawk aircraft to the Indonesian
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    Government barely three years after the annexation of East Timor. I have no idea whether there were signs on the sides of the aircraft stating that they were to be used everywhere except East Timor. The Opposition should think clearly and examine their consciences before criticising the Government 16 years later.
    There seems to be a clear recognition, from President Suharto downwards, that mistakes have been made in the past, and positive efforts are being made to improve matters. That impression was reinforced by interviews that we held with numerous non-governmental organisations, the National Commission on Human Rights and outside organisations including the International Red Cross. The delegation accepted the invitation on the condition that it would visit East Timor and would be able to talk freely to representatives of various interests in that territory. Having listened to some of the comments of Opposition Members today, I wonder whether we are talking about the same place.
    The island has the most extraordinary history. It was colonised at its western end by the Dutch and at its eastern end by the Portuguese, who were there for four and a half centuries. I have no wish to be offensive about our oldest allies, the Portuguese, but I have some knowledge of their other colonies. I have been to Angola and Mozambique. The precipitate departure of Portugal from those two colonies did not result in a happy outcome. I have been to Angola during the civil war and have seen the hostilities. We have heard today that, once again, the so-called peace treaty has broken down.
    At the vaguest hint of civil disturbance in East Timor in 1974, the Portuguese governor could not be seen for dust—he got into his boat and departed. Some 20 years later the Portuguese are apparently lecturing the world on a moral issue and saying that they have a role to play. It seems that they failed their colony at the time when they were most needed. Who is getting all the blame? Indonesia. It is the most extraordinary chain of events.
    The journalist Bernard Levin wrote what was perhaps one of the most vitriolic and unbalanced articles that I have ever read in The Times newspaper. It led me to the conclusion that Mr. Bernard Levin never moves from his axis between London W1 and Bayreuth to listen to Wagner. I do not believe that he has ever been anywhere near Indonesia in his life and he has certainly been nowhere near East Timor.
    When one wanders round East Timor it is extraordinary to see that, after four and a half centuries of colonisation, there is no evidence of anything left behind by the Portuguese. At least in Angola and Mozambique there was some sort of infrastructure and education system, but in East Timor the Portuguese left a literacy rate of 8 per cent. and no infrastructure—electricity did not arrive until 1962. It is clearly a poor territory.
    One hon. Member today questioned whether we should give aid to Indonesia now. If there is any place in Indonesia that needs aid, it is East Timor. Other territories in Indonesia are jealous of the funds being pushed into East Timor to lift it out of poverty—a good and legitimate use of our aid if we ensure that we have the influence to direct it to those parts where it is most needed .
    The right hon. Member for Tweeddale, Ettrick and Lauderdale (Sir D. Steel) said that the military governor of East Timor had justified what had happened at Dili. The right hon. Gentleman quoted an article by Amnesty

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    International. With respect to the right hon. Gentleman, I think that he is out of date as the general who is commanding there is, I think, General Adang, who makes no effort to defend what happened at that incident. He said that he had disciplined his troops and was looking to the future while bearing in mind the mistakes of the past.
    I will not dwell on this subject any more, except to say that whatever he may have said subsequently in newspapers, Bishop Belo told me that he supported special status for the territory and that he was delighted that human rights were improving, that there was more investment and that education had improved markedly.
    I should like to end on a slightly more general point. We have heard from the Opposition today outbursts of moral purity about arms sales, so I took the trouble to look at the Labour Government's record. We have already discussed the sale in 1978 of Hawk aircraft to Indonesia. I remind the House that the Labour Government that year also authorised the export of Sea Dart SAM and Blowpipe missiles to Argentina when it was under a military Government widely accused of human rights abuses. Where are the great moral standards there? In 1979 the Labour Government sold tanks to Iran, regardless of what they may have thought about the Iranian regime.
    With the benefit of hindsight one can always sound pompous, but at the time one has to make a judgment, bearing in mind the interests of the defence industries in places such as Ayr and my constituency, in which Racal and many other distinguished defence companies are located. They do a marvellous exporting job for this country.
    I welcome my right hon. Friend's typically robust, sensible policies as set out in the Gracious Speech. They will ensure that this country continues to be a force for peace in the world.
    8.41 pm
    Mr. Neil Gerrard: I shall confine my remarks to the middle east peace process, to which several hon. Members have already referred. I very much agreed with what was said by my hon. Friend the Member for Dundee, West (Mr. Ross) and by the hon. Member for Bexleyheath (Mr. Townsend). I look forward to hearing what the Minister has to say about the middle east.
    I want to discuss Gaza, Jericho, the occupied territories, and the need for our Government and other European Governments to take a more positive line on a number of matters. I refer first to the elections to the Palestinian authority. The Government have said that they want free and fair elections to be called—no one could disagree with that—but what is meant by free and fair elections? It is not just a question of who will be elected and how; it is also a question of what body is to be elected. The problem is that the Israelis say they want a single, small council with both executive and legislative power. The PLO has made it clear that it wants a division: a larger legislative council exercising some oversight of the Executive.
    If we are interested in promoting democracy and pluralism, we should be sending a clear message to the Israelis, to the effect that we believe there should be a split—a legislative body which has oversight of the Executive. We should couple that with a message about the need for redeployment of the Israeli forces in the west bank so that the elections can take place.
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    The other major issue is the financial aid that has been promised and supplied by Britain and other European countries. The money is rightly being channelled to the Palestinian National Authority, but it is obvious that it is still getting through slowly. There were reports yesterday that, of the £450 million promised for this year, only £140 million is likely to get through by the end of the year. Such delays are often explained by demands that there should be accountability and transparency when the aid money is spent. No one would argue against the need for accountability and transparency; clearly aid should be used for the purposes it was intended for. But how far are the demands being made reasonable, and how quickly is it reasonable to expect them to be met?
    I was interested to read in The Guardian yesterday the remarks of a senior official of the Israeli Foreign Ministry, Uri Savir, who said that donors should drop their insistence on the creation of a Palestinian tax system and finance immediate projects to clean up the area—refening here to Gaza—and create work. He made the point that if that was not done there was a danger of an erosion of the peace process.
    Besides the delays in the money coming through, there are all sorts of other financial pressures. There is chronic unemployment in Gaza, for instance. It is hard to see how Israel believes that that will be alleviated by imposing restrictions on workers from Gaza going to work in Israel. The Israelis have taken the decision to import foreign labour from Thailand in place of workers from Gaza. That hardly sits comfortably with declarations of their desire for economic growth. And without such growth the peace process will certainly be damaged.
    A further difficulty is the withdrawal of European and other funds from the non-governmental organisations that have hitherto provided many of the services in the area. Because of the history of the past 27 years of occupation, many key services such as education and health—and agricultural development—have depended on NGOs. About 60 per cent. of primary health care and 50 per cent. of secondary and tertiary health care has depended on NGOs; and they have provided 100 per cent. of pre-school programmes, not to mention a significant number of schools. These are important services, important not only for themselves but for the signals that they send about the values of a society. The NGOs have also been concerned with human rights and many other grass roots organisations in which local people have been involved during the occupation.
    There will be enormous difficulties for any Palestinian authority that attempts, quickly and easily, to take over responsibility for all these services. Money will be the biggest problem, given that there is no structure into which to fit such services, and there will not be much time to develop the necessary structure. Moreover, some of the services that the NGOs provide will not necessarily be seen as a focus for Government activity—services for women, human rights organisations and so on.
    I believe that restricting and impeding the activities of some of these NGOs could have a detrimental effect on the population. There is evidence that funding is being withdrawn because of the promise of European Union and other money to the PNA. A recent example drawn to my attention concerns the Union of Palestinian Medical Relief Committees. In 1994, 8 million ecu originally destined for NGOs was diverted by the EU to the funding of the Palestinian police. The relief committees were told not

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    to apply directly to the EU—there would be no money forthcoming this year or next. As a result, three health clinics that they run have already been shut and five more are under threat of closure. The clinics are often sited in some of the most disadvantaged and inaccessible areas. The Early Childhood Resource Centre based in Jerusalem is another organisation that has had to cut services. A day care centre in Hebron has closed and 20 per cent. of the staff have gone. It seems that international organisations are interested in funding infrastructures and building institutions, but not so interested in providing operating costs. They also make it clear that NGOs are low on the priority list.
    I am not arguing that support for the PNA is not essential: it is, and it is important to build the structures and institutions of government and authority and to make them function. Money to the PNA should not be reduced: quite the contrary, because two things are happening simultaneously. On the surface, responsibility is being transferred to the Palestinian authority and at the same time there are cuts in services such as health and education. Although one is not the cause of the other, they will become associated in people's minds.
    In opening the debate on the Gracious Speech, the Prime Minister said that the benefits of peace that people in Northern Ireland are now witnessing would be a powerful disincentive to renewed violence. That comment could apply equally to the middle east peace process. People must see benefits, and if a vacuum is allowed to develop those who step in will be the people who want the peace process to fail.
    There is a delicate line to tread and it is not for us to dictate to the Palestinian authority what its policies should be. Perhaps the functions of some NGOs should be taken over, or perhaps some of them will cease to have a useful role. No one argues that there should not be change, but we should be careful not to lose the dynamism, flexibility and creativity that have been developed through some of the NGOs during the years of occupation. Funds through the ODA or the European Union should not be cut before considering the effects and without helping the PNA to assume its responsibilities. Extra money should go to the PNA and it should not be money that has been taken from other organisations.
    We support the Palestinian authorities and want them to develop, take on functions, assume responsibilities and determine service delivery and policies. But we must also acknowledge and be prepared to support the independent role of Palestinian human rights groups and Palestinian NGOs. It is not good enough to hand over responsibility on paper to the Palestinian authority, to demand pluralism, accountability and transparency from it and to hold back the means to achieve those ends. If we do not provide the PNA with the means to develop we shall contribute to the foundering of the peace process.
    8.52 pm
    Mr. Phil Gallie: One of the benefits of being called late is that one has had a chance to hear expert contributions by other hon. Members. At the start of the debate I missed a large part of my right hon. Friend's speech. However, I was fortunate enough to hear his positive and authoritative comments on Northern Ireland and Bosnia. Northern Ireland has been mentioned in the
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    debate and in the media. I have been disappointed by the use of the word ceasefire. I understood that the Downing street agreement sought the abandonment of the bomb and the bullet by terrorists in Northern Ireland. We should not talk to terrorists merely on the basis of a ceasefire, but only if they are totally committed to political dialogue and negotiation on the future of Northern Ireland.
    I missed my right hon. Friend's comments on overseas aid and in particular his remarks about Malaysia. This year I was fortunate enough to visit Malaysia with members of the Commonwealth Parliamentary Association. I had last been there some 30 years ago and there has been tremendous development since that time. The changes in Malaysia are almost beyond the comprehension of people who visited that country many years ago.
    In recent times the issue of the Pergau dam has come to the fore. It seems that The Sunday Times picked up an old issue and began to replay an old story. Sadly, Opposition Members latched on to it, putting political interests ahead of the national interest. In our discussions in Malaysia we met the Prime Minister, the Foreign Secretary and many others and there was deep resentment about the comments in Britain about the Pergau dam.
    When countries such as Malaysia become independent and develop we must allow them to get on with their business in their own way. The Malaysian economy has developed at a rate of some 78 per cent. gross over the past seven or eight years and the country is moving away from third-world status towards developed-world status. That is to be admired, and it must be what overseas aid budgets are about—to allow third-world countries to develop.
    Mr. Eric Martlew: From what the hon. Gentleman says Malaysia has reached such a state of economic development that it does not need aid from this country. Many poor countries should get that aid.
    Mr. Gallie: When I went to Malaysia 30 years ago it was certainly a poor country, but over the years it has received assistance and is developing. Perhaps it is now moving out of development status because of its own efforts and the way that it has used overseas aid to help its people and make changes. The time will come when it will be appropriate to cut the aid, but that time was not when the Pergau dam was suggested.
    Malaysia recognised that it needed power and that it certainly needed the dam. I recall discussing this matter with the hon. Member for Clydebank and Milngavie (Mr. Worthington), who suggested that Malaysia needed gas turbines. That is an expensive way to provide power. Water power is provided by a renewable resource and it can be projected into the future at low cost. It is the kind of power that countries such as Malaysia need to lift them into developed-world status. I fully approve of the assistance that was given for that project, although by saying that I may be unfashionable.
    There is another prospective project in that area, the Bacun project in Sarawak. It is similar to the Pergau project and is high-tech. It will be a 700 or 800-mile undersea cable between Sarawak and mainland Malaysia, and the project will be financed by private capital and will not require overseas aid. It will be to the credit of the Malaysians if they can take that project forward.

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    Some hon. Members spoke about interference in Kenya through educational involvement. The right hon. Member for Tweeddale, Ettrick and Lauderdale (Sir D. Steel) suggested that we should pre-empt happenings in other countries. We cannot encourage the expansion of democracy and freedom in other countries and then pre-empt them and sit on top of them. That was a surprising development in today's debate.
    When we discuss overseas aid projects and speak of lack of concern, perhaps we should have some concern for the jobs in Britain that could be affected by overseas aid. I draw the attention of the House to recent developments in my constituency where the hon. Members for Carrick, Cumnock and Doon Valley (Mr. Foulkes), for Cunninghame, North (Mr. Wilson), for Cunninghame, South (Mr. Donohoe), for Kilmarnock and Loudoun (Mr. McKelvey) and I expressed concern to the Foreign Office about the way in which the feedback of overseas aid to Brazil was against the interests of those in my constituency through state assistance to the Brazilian aircraft industry.
    When Ministers operate our overseas aid programmes, they should have regard to jobs and benefits for our industries at home while considering the needs of those countries that we wish to develop.
    Turning to wider issues in the Gracious Speech, little has been said today about defence. I welcome the top priority given to national security which has been demonstrated amply over 15 years despite the pressures that my right hon. and learned Friend now has in his budget. Unlike previous Secretaries of State for Defence in recent times, it has to be recognised that financial limitations are being applied to defence issues. That has been demonstrated in the excellent paper "Front Line First", where reality has been applied to ensure that our defence systems meet future needs.
    I was delighted to hear in the Gracious Speech that the United Kingdom is still intent on maintaining its nuclear deterrent. Whatever we do in this country, nuclear weapons cannot be uninvented. We can, however, stop further development and proliferation and that was an important commitment in the Gracious Speech.
    The United Kingdom nuclear deterrent and the resolve shown by previous Conservative Governments and the Government of the USA brought about the fall of the Berlin wall and the collapse of repressive socialist systems in eastern Europe. The nuclear deterrent maintained peace between the major powers for almost 30 years, so we should be grateful that that element was built into the Queen's Speech.
    I am delighted that the Labour party appears to be signing on to the principles of retaining our nuclear deterrent, but I look to its party conference and the problems that the new Labour party leader had with the grass roots of the party in dealing with the issue. Had that happened at a Tory party conference and had my right hon. Friend the Prime Minister been threatened and lost votes in conference, the media would have had a field day and would have totally written him off. We had no such problems and I am sure that our Prime Minister will be here for many elections to come, fighting the good fight.
    I turn to the Scottish dimension and the situation at Rosyth, where I was pleased to come together on a cross-party basis with hon. Members who wished the Government to retain past commitments to Rosyth
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    dockyard. In part we lost that argument, but we had strange bedfellows in that we lined up with people from nuclear-free authorities who were fighting to contain nuclear submarines at Rosyth. But we won a commitment to Rosyth dockyard continuing surface fleet maintenance. As we look to the coming Session of Parliament, I believe that when the Government consider the defence programme, they will stick to their pledges on that issue and I welcome that.
    When we look at "Front Line First", we must also consider services, support and procurement. I have to register some concern at the GEC bid for VSEL. If the Government were to allow GEC to take over VSEL as well as owning Yarrow, they would be putting all their eggs in one basket in respect of warship construction.
    There is a suggestion that GEC could put up separate tenders for each of the yards, but I do not believe that any company with ownership of two yards such as these would do so in a competitive way. On that basis, such a move would undermine the Government's commitment to ensuring competition in all aspects of its business and allowing market forces to operate in the defence industry while ensuring that there are options for delivery of such important items as warships from UK yards.
    There is a difference between the warship and the aircraft industries. With warships, we rightly have a tendency to buy British. That is both wise and necessary. Therefore, it is important to have more than one warship construction yard in the United Kingdom.
    There are other aspects of Britain's future defence requirements, and I think especially of the future large aircraft and the current thinking on the provision of transport aircraft for the military. I accept that the Hercules has done a good job over the past 25 years, but it was designed 30 or 40 years ago and a revamped version would not be the right aircraft to go forward into the next century.
    There are other options. I would like to find an aircraft that increases volume both in capacity and weight and which offers greater fuel efficiency and flying range. That is what I would expect of an aircraft going into the year 2000. The European industry should have the opportunity to provide the future large aircraft for the RAF and other military forces throughout the world.
    We must not turn our back on giving our aerospace industry the chance to compete. That will help to provide future Ministers with the opportunity to find deals that fit both our budgetary and military requirements. The hon. Member for Dundee, West (Mr. Ross) said that his preference would be for an aircraft such as the Jetstream 41 to be sold worldwide. I agree with him, but remind him that the investment in that aircraft has come from the success of British Aerospace's defence programme. We cannot ignore that fact.
    Jetstream 41 has been greatly successful. At the beginning of this week Jetstream at Prestwick won an order from America for 60 aircraft. That is worth a quarter of a billion pounds. It shows great commitment from the management and work force. It recognises the assistance of the Foreign Office and the Department of Trade and Industry in ensuring that other countries do not use unfair subsidies against British industry. It also

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    recognises some of the assistance given by the DTI and the Scottish Office in support of Jetstream during recent years.
    Another opportunity for my constituency provided by "Front Line First" is the involvement of the private industry in training pilots for the RAF. The flying college at Prestwick can now bid for that business. It is also intent on picking up business from South Africa. Following the successful visit of my right hon. Friend the Prime Minister to that country, it was suggested that Britain should use its knowledge and experience to benefit the emerging sectors of society in South Africa. I can see no better way of using our expertise in our flying colleges than to train coloured pilots who were not given such training in South Africa in the past.
    Like my hon. Friend the Member for Wimbledon (Dr. Goodson-Wickes), I, too, welcome the changes in South Africa. We must be grateful to the Government who, during recent years, have turned their back on imposing on South Africa sanctions which would have been particularly damaging to its emerging nation status now.
    I should like to believe that the Government's common-sense, realistic and practical policies in foreign affairs and defence matters which are demonstrated in the Gracious Speech will be continued well into the future.
    9.10 pm
    Mr. Mike Gapes: At this stage of the debate it is tempting to follow all kinds of hares and red herrings, but I shall resist doing so and keep to the main point that I want to make.
    Five months ago the United States President, speaking to the French National Assembly in Paris, said:
    "America will remain engaged in Europe. The entire transatlantic alliance benefits when we, Europe and America, are both strong and engaged."
    Those words obviously have less significance and relevance today, following the American decision unilaterally to disengage from the United Nations embargo on arms going into Bosnia.
    I am worried about United States foreign policy. The House and the British people should be far more worried about that than about some hysterical argument inside the Conservative party about £200 million. It would be better if just one tenth of the energy expended today were devoted to considering the serious consequences of the Republican victory in the United States elections. To put Jesse Helms in charge of Senate foreign policy is like putting Attila the Hun in charge of child protection. What does that mean for the future of the Atlantic alliance and European policy in relation to the United States?
    The Secretary of State for Defence tried to finesse that issue a few days ago by talking about a European-Atlantic partnership. That will not do. At this stage we must recognise that mere words will not solve the problem. Nor will the justifiable anger that the lives of British men and women could be put at risk by the short-sighted policies of the American Administration solve the problem.
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    To use an American expression, we should not get mad, we should get even. That means that we should recognise the need to build up the co-operation of the European Union countries with regard to foreign and security policy. We should also recognise—I say this as someone who has strongly supported the continuing NATO alliance—that the Western European Union should take on a growing significance.
    The Gracious Speech refers to the Western European Union, to NATO and to security in a wide sense. We must be more realistic. The days of American multilateralism may be coming to an end. We will see more and more examples of global unilateralism from the United States. If Britain is to play a serious part, it must realise that, at this moment, Europe does not have the
    intelligence-gathering satellites or heavy airlift capabilities necessary to make a contribution in the Security Council or to our own continent's security. We depend too much on the world's only remaining super-power. If its foreign policy is driven by domestic considerations, so that it will invade Haiti but do nothing about Angola; by lobbies and pressure groups; or by the need to gather Cuban American votes in Florida by adopting a ridiculous policy towards Cuba, the rest of the world must develop collective security to make the UN an effective body, sometimes without the United States. That means recognising an irreducible minimum of British defence expenditure.
    If Britain is to be an effective member of the Security Council, a serious player in the future defence and security of our continent, and to be able to punch above our weight—to use the words of the Foreign Secretary in another context—Britain must have not just diplomatic but defence and security capability.
    Defence and security are much more than a matter of hardware or manpower. It is a question of how we engage politically in international processes. The statements in the Gracious Speech about the non-proliferation and nuclear test ban treaties would have much more significance if backed by Government action to make sure that the NPT review conference in 1995 is indefinitely extended. The big sticking point is the objection by a number of developing and third-world countries to the fact that not all nuclear powers have seriously observed their obligations under article 6 of the NPT. They cite in particular Britain and France, with continuing expansion of their strategic arsenals, and the Chinese nuclear tests, which do not follow the pattern of the United States and Russian reduction programmes. A serious commitment by the British Government to engage in negotiations to reduce our strategic nuclear weapons in the near future would achieve far more to ensure the success of the NPT review conference than much that other countries can do.
    UN peacekeeping operations require far more serious consideration by the British Government. Reference to that issue has already been made by my hon. Friend the Member for Clydebank and Milngavie (Mr. Worthington), who made a serious point about the role of UN peacekeepers in Somalia. Britain did not engage in that operation, presumably because it did not have the means. If Britain is to be a serious permanent member of the Security Council, it must make a much greater commitment to "Agenda for Peace", the policies of Boutros-Ghali and UN peacekeeping operations worldwide. The future of our defence and security depend on our European security and on our international security

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    through the United Nations. I hope that, during the next few years, a Labour Government will be able to put that process to good effect.
    9.19 pm
    Dr. David Clark: We welcome the opportunity to debate foreign affairs and security. Often, we debate defence against the narrow background of our national defence or of our industrial base. Of course it is right and proper for us to do that, but it is important, every so often and especially when we debate the Gracious Speech, to set our security policy in the context of our foreign policy. In the changed world in which we now live, defence and security mean something rather different. We need now to think of a wider approach to defence. We can afford to stand back a little and think of defence and security in a more philosophical and reflective manner.
    The Foreign and Commonwealth Secretary, who spoke in his normal suave, urbane manner, is indeed the acceptable face of the Conservative party today, but even he stretched the point a little when he described the swindlers and fraudsters of the European Community as people who have "over-benefited". That is a rather new, nice word, and it is a tribute to his diplomatic skills that the right hon. Gentleman can think of such a conjunction.
    My hon. Friend the Member for Livingston (Mr. Cook) has made many memorable speeches. Today, he maintained his high standard in his new bipartisan approach. His forensic approach will demand a new definition from the Foreign and Commonwealth Secretary. We look forward to the jousting in the years ahead. It will be interesting to see the right hon. Member for Witney (Mr. Hurd) in his role as shadow Foreign and Commonwealth Secretary opposite my hon. Friend.
    Eighteen right hon. and hon. Members have taken part in this wide-ranging debate, and many points have been made. Several trends are apparent, and I shall try to develop some ideas.
    We are conscious that we are debating security and foreign affairs in a new world order. In the past five years, we have seen dramatic changes, yet the euphoria of those days has long passed. There is now one super-power and it is necessary to help people in the former communist bloc to improve their standards and quality of life and make the transition from the command economy to the market economy.
    We always bemoan uncertainty, but certain things can be seen clearly. The first is that the transformation from communism will be long and complex. Certainly, it is not enough for western Governments and communities merely to pay lip service. We must do more to help those countries to transcend the gap. We need also to try to offer stability to the newly emerging democracies.
    Those of us in liberal democracies have to meet certain challenges. The market economy, unbridled, is not a liberal democracy. If one is not careful, one creates underclasses, which negate the concept of free democracies. We must avoid that in our country and we must avoid exporting it to newly emerging democracies. If one goes to some of those newly emerging democracies, one can see that while some people do well in the nascent capitalist system, other people do not. They have lost
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    benefits such as subsidised food and housing and proper health care—the up-side of communism, so to speak. We have to take that message on board.
    Faced with that position, the west is lacking in leadership. That comes through time and time again and we have seen it this past week. The United States of America has taken a different line from the NATO allies. That has caused all sorts of difficulties. While the Opposition agree with many of the fine words in the Gracious Speech, we sometimes wonder how certain, is the intent of those words.
    We are obviously with the Government 100 per cent. in trying to promote a peaceful settlement in the former Yugoslavia. We join the Government in paying tribute to the men and women serving in our forces there I regret very much the American decision of last week. It is not simply a matter, as the Foreign Secretary said, of two ships. There is the issue of intelligence. As the Foreign Secretary knows, the United Nations has no intelligence-gathering facilities of its own. We in Britain rely considerably on American satellite intelligence.
    I have just returned from a defence conference in Washington. The view over there is that the Americans have stopped providing us and the United Nations with intelligence. That may be one of the reasons why the Foreign Secretary shares our view—I am sure that he has expressed it clearly to his American counterparts—that the American decision is wrong and, if pursued, could put at risk the troops serving under the United Nations. That point was also made at the conference in Holland earlier this week. We believe that the Government were right to make that point, but we hope that they are making it clearly to the Americans.
    I often hear debate in the west about whether NATO has a role. It is interesting that I hear that question only in the west. I do not hear it in the east because people there are certain that NATO has a future. They know that if it had not been for NATO, we would not be in the position that we are now in. They know the effectiveness of NATO. The great challenge for us in the west is how to change NATO. It has to change, yet it must retain its effectiveness.
    The Labour Government were instrumental in the formation of NATO. We have always stood by our commitment to it. We regarded it in the past as the linchpin of our defence strategy. We still regard it as such, but it has to change. It has to move with the world. It is a great pity that Her Majesty's Government have not taken the lead in pressing for changes in NATO. There have been movements in the past two weeks. We welcome late conversions, but I feel that the enthusiasm is not there. Surely we should take much more positive steps to bring some of the former eastern European Warsaw pact countries into NATO.
    Partnership for Peace, which was seen by many as a stalling process, has turned out to be what we hoped it would be: a first step. I was greatly encouraged that when President Clinton was in Poland he said that it is a question not of "if" NATO is expanded eastward but of "when". We must take that debate a stage further. 'We already have the cells at Mons and at NATO headquarters. Things are beginning to happen. The Governments of the former eastern European countries are more reassured.

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    We must take the debate a stage further for the following reason. I mentioned the responsibility that we in the west have for nurturing those democracies. I remember being most impressed by something that the late Secretary-General of NATO, Manfred Wõorner said. He told me that he had been a politician in the German Parliament in the 1960s, when democracy was fragile—in the days before the European Union. He felt that one reason why democracy thrived in what was then West Germany was that it was part of the NATO framework. It was the experience of being part of a partnership with other democratic countries.
    What was true for western Germany in the late 1950s and 1960s will be true for Poland, Hungary, the Czech Republic and Slovakia in the near future. We must grasp that nettle and set up meetings with those countries—not merely partnership meetings—to discuss how we can take the process a stage further.
    We must also be aware that a move is taking place across the Atlantic. The Brown amendment in Congress gives assistance to the Visegrad countries in particular. That is what we should be doing.
    We should be seeking the criteria for NATO's expansion. Those must be based not on purely logistical or technical grounds but on geopolitical and philosophical grounds. We should be talking not about what is necessary and good for our defence but about what is good for the security of the west. That is the sort of approach that we need. I fear that many of the technical and military arguments are often used more for procrastination than genuine argument. We urge the Government to pick up that baton and run with it.
    My hon. Friend the Member for Ilford, South (Mr. Gapes) mentioned the second reform of NATO, a development that we hope that the Government will pick up and run with. Last week's events—our experiences with the Americans—together with many others, point to the fact that we in Europe must take a much larger responsibility for the security of Europe. For too long, we have been too dependent on the United States. For too long, Europe has had its defence on the cheap, so to speak, and we have allowed the United States to shoulder a financial burden. It has made it clear that it is no longer prepared to do so.
    We must start thinking about the defence architecture of Europe so that we can blend it in with NATO and fulfil our Maastricht commitments. We should not be in the rear, we should be in the van and I hope that the Government will accept that.
    I have always been sceptical about the Western European Union and many hon. Members share that view. Having said that, we are in a new ball game. We have a new framework within Maastricht and NATO is changing. It is not beyond the ingenuity of man to reshape WEU and make it a meaningful defence arm for Europe.
    I suspect that, before too long, we shall also have to consider another organisation that is much derided here in Britain—Eurocorps. France, Germany, Spain, Belgium are already there and I am certain that Poland will be in before long. We need to be in as well. We must do more lateral thinking regarding the shape of the defence architecture of Europe, and we hope that the Government will see through that part of the Queen's Speech.
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    There are one or two points that I could perhaps raise with the Secretary of State for Defence. I did not see any reference in the Gracious Speech to a Bill on the British reserve forces. The Secretary of State knows that there is a need to change the regulations affecting our reserve forces. In an answer to my hon. Friend the Member for Carlisle (Mr. Martlew), the then Minister of State for the Armed Forces—now the chairman of the Conservative party—said that it was the intention of the Ministry of Defence
    "to enact a change in the legislation next year."—[Official Report, 12 April 1994; Vol. 241, c. 11.]
    Do the Government intend to bring forward that Bill?
    I can tell the Secretary of State that the Opposition would not be averse to such a Bill—we think that it is needed—as long as he does not intend to create a reserve force of unemployed people. There must be protection for people in employment, or the Bill would not be acceptable. If he can give us that assurance, the Secretary of State will have a fair wind with that Bill.
    My hon. Friends have emphasised the need for international co-operation, whether on the arms trade, weapons conventions or whatever. We feel strongly that many of those problems can be tackled only through international action. Again, there are omissions in the Gracious Speech in that area. What about the chemical weapons convention? The Secretary of State has made great play of the fact that we were early signatories, but he knows that the convention cannot come into law until 65 states have ratified it. Why have we not ratified the convention?
    I understand that it was the Government's intention to ratify the convention. If it needs legislation, I can assure the Secretary of State that he will not find the Opposition standing in the way of the ratification of that convention. It is important that we press ahead with it, and I hope that the fine words that we have heard in the past will come to be enacted.
    Again, we know of the Government's original reluctance about a comprehensive test ban treaty. I have referred ad nauseam to the attitudes and words of various Ministers who were saying that it was unwise. We now have a position where the French, Americans and Russians have stated quite clearly that they want a comprehensive test ban treaty. We are caught up in the situation, and we cannot test because the Americans will not let us. Why do we not grasp the nettle, join the other four countries and try to persuade the Chinese to come in with us? We need a comprehensive test ban treaty, and again I can assure the Secretary of State that he will meet with no difficulty from the Opposition.
    It is important that some movement is made on the non-proliferation treaty. If we can show the non-proliferation treaty signatories that we are making efforts to try to limit nuclear proliferation, and that we are also not testing our own weapons, that will be a bonus, and help to get more signatories. The Opposition would support any effort to get the non-proliferation treaty enacted, but again I would urge the Government not to escalate further. The Secretary of State for Defence knows that, with our Trident submarines and multiple warheads, there will be a considerable increase in the number of our nuclear warheads. Why does not the Secretary of State join the Labour party? [HoN. MEMBERS: "Hear, hear."] He would be a very welcome member—but perhaps the party is not quite as broad a church as that. Why does he not

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    accept Labour party policy in this respect? He should say that the Government will not escalate the deployment of our Trident submarines and will keep the number of nuclear warheads at the same level as those commissioned for Polaris. That would be a positive step forward.
    We live in times of great change. The Government have said many of the right words in the Queen's Speech, but we are worried that they will be found wanting when it comes to enacting them. We plead with the Government that now is the time, especially with vacillation across the Atlantic—although we must retain our links with the United States—for us to play a much greater part in defence policy making in Europe and also to play a greater part in the leadership of the UN.
    9.40 pm
    The Secretary of State for Defence (Mr. Malcolm Rifkind): Although I cannot accept the kind invitation of the hon. Member for South Shields (Dr. Clark) to join the Labour party, I would like to pay tribute to him for returning early from the United States for this debate. I believe that he flew overnight in order to take part, and I am sure that the House would wish to acknowledge that recognition of the importance of the occasion.
    The hon. Gentleman asked about our intentions with regard to the reserve forces. We intend to publish a draft Bill on the reserve forces for consultation early in the new year. That will enable much important progress to be made in the next few months. I welcome the hon. Gentleman's indication that the Opposition would wish to join us in giving maximum support to the modernisation of the legislation involving the reserve forces, so that they can play an even fuller part in meeting the requirements that the country expects from them.
    The hon. Gentleman also made a passing reference to the arms trade. I was rather sad that he did not use this opportunity to clarify the Opposition's policy, because, in a fairly typical contribution from the hon. Member for Livingston (Mr. Cook), typical of the so-called new Labour party, he sought to sound very disapproving of the arms trade, because of the mutterings from those on the Benches behind him, but, at the same time, did not feel able to condemn it. That would have been inappropriate, given the previous observations of the shadow spokesman on defence, the hon. Member for South Shields.
    It is right to remind the House how unequivocal the hon. Member for South Shields has been in his support for the arms trade and for arms sales. Last year, in an interview with New Statesman and Society, the hon. Gentleman was asked his views and the article described how
    "He runs down his mental checklist. Sales to allies: no problem. Sales to friendly Governments such as Saudi Arabia: all right. As for British Aerospace's proposed sale of Hawk…"trainers"…to Indonesia, Clark is in favour. South-east Asia needs a stronger security system, he says, and Indonesia must be a part of it"
    The hon. Gentleman offered no qualifications, nor did he specify that his approval was subject to other factors: he just gave an unqualified endorsement of arms sales to Indonesia, as well as to all the other countries about which he was asked.
    Dr. David Clark: The Secretary of State may be aware of a letter, sent on 3 November 1993, from the Foreign Secretary to my right hon. Friend the Member for Copeland (Dr. Cunningham). My right hon. Friend had
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    asked the Government what assurances they had been given from Indonesia regarding the Hawk aircraft,. The Secretary of State replied:
    "We have sold Hawk aircraft to Indonesia in the past, and have no evidence that they have been used against the civilian population of East Timor."
    That was the very question which my hon. Friend the Member for Livingston (Mr. Cook) asked the Foreign Secretary earlier today. Let me repeat it: have the Government still no evidence that the Hawk aircraft have been used against the East Timorese? We would be willing to accept the Government's reassurance on that.
    Mr. Rifkind: I did not notice any qualification of that kind in the answers that the hon. Gentleman gave in his interview in New Statesman and Society. We have no evidence of any use of Hawk trainers in East Timor. I plead with the Opposition Front-Bench spokesmen to stop displaying a holier-than-thou attitude towards the issue. I am talking not about the hon. Member for South Shields, but about the hon. Member for Livingston, who, as usual, tried to play both ends against the middle and ended up disappointing every point of view on the spectrum.
    Some important speeches have been made during this debate. My hon. Friend the Member for Bexleyheath (Mr. Townsend) asked about the European dimension of defence. The Government strongly believe that, within the crucial framework of NATO, it is sensible and desirable to develop European co-operation. In the areas of collaboration, we have important projects such as the Eurofighter and the common frigate, but there are limits to the amount of co-operation that is possible, because, unlike the United Kingdom, a number of other western European countries still have state-owned industries, monopolies or subsidies in a way that makes competition, on which we insist, more difficult to achieve. But within that framework, we like to make progress in that way.
    The hon. Member for Blaydon (Mr. McWilliam) asked me when 45 Commando could hope to return to the United Kingdom. We intend that, once the current exercise with the Americans in Kuwait is complete, it will return to the UK. That will mean some time in December, so it should be home in time for Christmas.
    My hon. Friends the Members for Wolverhampton, South-West (Mr. Budgen) and for Ludlow (Mr. Gill) deplored the fact that the Government had indicated the importance that we attach to the European Communities (Finance) Bill, and suggested that that was inconsistent with parliamentary democracy. I must say with all due humility that any Government are entitled to make it clear that they will not continue in office if they cannot get the support of the House of Commons on a measure to which they attach importance.
    Likewise, it is for my hon. Friend the Member for Ludlow to decide for himself how he will vote, in the knowledge that, if the Government are defeated, they will not remain in office. For him to say that that is a denial of democracy or of the rights of Members to vote according to their conscience is not a valid or defensible position. I ask him to reconsider his view.
    My hon. Friend the Member for Castle Point (Dr. Spink) was correct to emphasise the fundamental achievement of the European Union, which has helped ensure that war between the states of western Europe has become inconceivable. We hope to see that develop across Europe.

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    A number of hon. Members on both sides of the House have commented on Bosnia. We have made it clear that we were concerned by the American decision, but, as my right hon. Friend the Foreign Secretary said, it is important to emphasise that the practical consequences of the American announcement are extremely modest. That is not just our view, but that of the Military Committee of NATO, which dealt with that matter and concluded that there was no good reason to doubt that the operation in the Adriatic could continue and be expected to be successful in the coming months.
    May I emphasise two additional points with regard to that announcement? First, it has become fashionable for people to argue that the United States is losing interest in Europe and that therefore the NATO alliance will wither and disappear. The recent events in relation to Bosnia can hardly be described as a lack of American interest in Bosnia or Europe as a whole. There may be a difference of view about the appropriate policy to pursue, but that shows that the United States remains very interested in Europe's welfare, which we unreservedly welcome.
    It is also worth remembering that the decision announced by the United States not to enforce the embargo in the Adriatic came about as a compromise, because the United States Government had reached the same conclusion as the British and other European Governments—that the lifting of the arms embargo was inappropriate at this stage and would do more harm than good. That was also the Bosnian Government's conclusion.
    So it was because the American Government declined to accept the view of those in Congress who wanted the embargo to be swept away that Congress chose to try to enforce that relatively minor change with regard to the operational circumstances.
    Mr. David Harris: Has my right hon. and learned Friend noticed that, although the leader of the Liberal Democrat party made a great fuss about Bosnia, not only is he not present, but not a single Liberal Democrat is in the Chamber for the wind-up of this important debate on defence and foreign affairs, on which the Liberal Democrats pretend to place great importance?
    Mr. Rifkind: It is indeed strange that the Leader of the Liberal party should have made no attempt even to be present at any time during this important debate, as far as I am aware. His right hon. Friend the Member for Tweeddale, Ettrick and Lauderdale (Sir D. Steel) spoke, and told me that, sadly, he was unable to be here for the reply, but that is obviously a matter for him to explain in those circumstances.
    Mr. Gapes rose—
    Mr. Rifkind: If the hon. Gentleman will forgive me, I must continue my remarks.
    I hope that, in the weeks and months to come, those people in Congress who feel strongly about Bosnia, and who may wish to advocate the lifting of the embargo, try to find an opportunity to visit Bosnia, to see the work that is being done by the United Nations. I believe that that could have an important impact on the way in which they regard the matter.
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    Very few Congressmen who have expressed strong opinions on those issues have taken the trouble to go to the country, to meet the members of the United Nations force, to see the way that they have saved thousands of lives and are continuing to save thousands of lives, and to examine at first hand what the practical consequences would be if the embargo were to be lifted and if the United Nations were therefore to withdraw. I believe that that is the least that they owe the international community and the people of Bosnia—to go and see for themselves, and to discover whether they continue to hold the same opinion about the lifting of the embargo.
    My hon. Friend the Member for Ayr (Mr. Gallie) was kind enough to make complimentary remarks about the defence costs study. We are at present in the process of consulting on many of the proposals, and involving ourselves in their early implementation.
    Some of the changes will involve significant reductions in manpower. As a first step, as many as 80 Army officers of the rank of brigadier and colonel will be surplus to our requirements. We are seeking volunteers, as we would normally do in a situation of that type. It is always sad if we lose people of good quality, but that is an important consequence of the changes in the armed forces—to ensure that the maximum resources can be concentrated where they are most required.
    Several hon. Members referred to the remarkable contribution that our forces have made in Rwanda. They will return on Sunday or Monday of next week, and they will do so having completed a remarkable job. About 615 people have been there since August. They have, during that period, been involved in vehicle maintenance, and bridge and road reconstruction. They have, as the Foreign Secretary said, cared for about 125,000 casualties, providing medical help where required, and they have been involved in the transport of supplies that are crucial for the well-being of the people of Rwanda. Not only the House but the country can be proud of what they have done in difficult circumstances, and I know that we shall all wish to pay tribute to them.
    The Foreign and Commonwealth Secretary said that I would comment on the middle east, a region in which there has obviously been remarkable progress in the past year. I had vivid evidence of that fact when I was able to fly from Tel Aviv to Amman direct—a 20-minute journey, which would have been inconceivable as recently as a few weeks earlier. That is a mark of the important changes that have occurred.
    Gradually the foundations are being laid for a lasting peace settlement, which we hope will be acceptable to all the peoples of the region. We have witnessed the peace treaty between Israel and Jordan; we have witnessed the gradual winding down of the Arab boycott against Israel. We have witnessed progress in the talks between the Israelis and the Palestinians, which have led to the withdrawal from Gaza and Jericho, and there is now the possibility of talks between the Israelis and the Syrians, which could lead to the resolution of one of the most difficult and intractable problems.
    The United Kingdom is seeking to make a useful and important contribution to that process. We are working hard to support peace in the middle east, politically and economically. We are giving £75 million to the Palestinians, helping them to build their institutions and create jobs. We have supported the Palestine police by providing £3 million to help pay salaries, and with

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    training courses at Bramshill police college. A safe and secure environment will be vital to the success of those new operations. We are also ready to help set up the Palestine monetary authority. We want to help to add meaning and credibility to Palestinian autonomy.
    However, I emphasise that the prospects of peace in the middle east are improved not only by adding strength to those welcome foundations but by showing resolve in deterring those people in the region whose agenda is one not of peace but of conflict. Whether it be through incidents of terrorism or other means, we know that there will be people who will continue to try to destroy the prospects for peace, and therefore the road to peace will be slow and difficult. The leaderships in the middle east, both Israeli and Arab, are determined to make progress and we shall give them our fullest support.
    Mr. Sainsbury: My right hon. and learned Friend will be aware that what he has just said, as well as his recent visit, will be widely welcomed. Can he confirm that it is the Government's view that direct talks between Israel and Syria are the best way of furthering the peace process, as has been proved by the talks between Israel and Jordan and on other occasions?
    Mr. Rifkind: Yes, that must be desirable, and we very much hope that that will prove possible. We have seen that direct talks, whether between Israel and Egypt or Israel and Jordan, have the best prospect of resolving some of the most difficult problems and of building a climate of trust, without which the progress that we all desire cannot be fully achieved.
    My right hon. Friend the Member for Oxford, West and Abingdon (Mr. Patten), and a number of other hon. Members, were kind enough to refer to a speech that I made earlier this week about the relationship between western Europe and north America. Most people in the House and on both sides of the Atlantic realise the continuing importance of the north Atlantic alliance and why, on matters of defence and security, NATO remains crucial to the well-being that we all require.
    We are also conscious of the fact that in the post-cold-war world, as long as there is no direct threat to the security of western Europe, it will be increasingly difficult to create the same sense of enthusiasm if the Atlantic relationship is presented as if it is concerned only with defence and security issues. The common interests on both sides of the Atlantic transcend the issues of defence and security.
    That is why I have suggested that we should try to create a new framework that incorporates the spectrum of common interests that bind together the peoples of both sides of the Atlantic ocean.
    Mr. Patten: Before my right hon. and learned Friend concludes, I should be grateful if he would reflect on one point about foreign affairs that I made during my brief intervention. I requested whether, in the face of the apparently publicly disinterested views of the German presidency towards fraud, my right hon. Friend the Foreign Secretary would consider asking for a special ministerial Council to consider the issue. Is the answer yes, no or maybe?
    Mr. Rifkind: I think that my right hon. Friend will appreciate that ECOFIN has the main responsibility in that sphere. Therefore, my right hon. Friend's interesting
    228
    suggestion should best be directed to my right hon. and learned Friend the Chancellor of the Exchequer—and I am sure that it will be drawn to his attention.
    In the few minutes left, I wish to emphasise what I believe is necessary, which is to create a framework that will—[Interruption.] My right hon. Friend the Member for Oxford, West and Abingdon had the answer that I am sure he wanted to hear—[Interruption.] If I may be allowed to continue.
    The fundamental interests that bind the two sides of the Atlantic are, in the first instance, the defence and security considerations that we have been discussing. But other factors include the extent to which concepts such as the rule of law are fundamental to north America and western Europe, the economic arrangements, which are a fundamental part of our economic philosophy, and the cultural identity that is crucial to all the countries that follow from the European civilisation.
    Increasingly over the next few years, there will be new threats to the western way of life that may not now be as apparent as might otherwise have been expected. 'We know that there is a resurgence of nationalism in parts of eastern Europe. We know that some people are attached to authoritarian ways of life. We know that the economic challenges to western Europe and north America will be profound.
    My right hon. Friend the Member for Guildford (Mr. Howell) was right to emphasise the fact that, in the far east, there are countries with remarkable economic prospects. One only has to contemplate what has been achieved in Taiwan, Singapore or Hong Kong to speculate on what the mainland Chinese republic will be able to achieve when it finally puts off the yoke of communism and allows the opportunities that liberal capitalism provides to take forward its economic prospects.
    Mr. William McKelvey: Will the Secretary of State comment on the request made by the hon. Member for Ayr (Mr. Gallie) for a reference of the GEC bid to the MMC?
    Mr. Rifkind: The hon. Gentleman will be well aware that, when matters of that kind are raised, a proper procedure is followed. The Ministry of Defence expresses its views to the Department of Trade and Industry. The Office of Fair Trading makes its recommendation, and my right hon. Friend the Secretary of State for Trade and Industry announces his conclusions in due course.
    I believe that the defence and security of the United Kingdom are in the hands of a Government who, for 15 years, have given the greatest priority to international security—this during a time for most of which the Labour party has been a unilateralist party committed to weakening our defences—
    It being Ten o'clock, the debate stood adjourned.
    Debate to be resumed tomorrow.

PRIVILEGES
Ordered,
That Sir Peter Hordern be discharged from the Committee of Privileges and Sir Donald Thompson be added to the Committee.—[Mr. Wells.]

HOUSE OF COMMONS COMMISSION
Ordered,
That Mr. John Garrett be appointed a member of the House of Commons Commission in place of Ms Janet Anderson under the House of Commons (Administration) Act 1978.—[Mr. Wells.]

PETITION

  Vickers Shipbuilding and Engineering Ltd.
  10 pm
  Mr. Phil Gallie: The petition reads as follows:
  "To the Honourable the Commons of the United Kingdom of Great Britain and Northern Ireland. The Humble Petition of the employees and friends of Jetstream Aircraft Limited sheweth that in our opinion the GEC bid for VSEL, if successful, would create a monopoly in warship building in contravention of the Government's stated policy of competition in defence procurement.
  Wherefore your petitioners pray that your honourable House urge the President of the Board of Trade to recommend referral of the GEC bid for VSEL to the Monopolies and Mergers Commission. And your petitioners, as in duty bound, will every pray, etc."
  This petition was prepared last weekend in haste, with the full support of the hon. Members for Carrick, Cumnock and Doon Valley (Mr. Foulkes), for Cunninghame, North (Mr. Wilson), for Cunninghame, South (Mr. Donohoe) and for Kilmarnock and Loudoun (Mr. McKelvey). It was signed eagerly, too, by the people of Ayrshire, who strongly support Jetstream Aircraft. They do so in the belief that, in a world of competition, it is important that there be competition, particularly when taxpayers' interests are at stake. That is why my colleagues and I have great pleasure in presenting the petition to the House.
  To lie upon the Table.

Northern Line
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Burns.]
10.2 pm
Mr. John Marshall: I should like first to thank a number of my hon. Friends who have shown a special interest in this matter but who cannot be here this evening. My hon. Friends the Members for Chipping Barnet (Mr. Chapman) and for Derby, North (Mr. Knight) have taken the Trappist vows of the Whips Office, but that has not prevented them from using the influence that comes with association with that office to put the case strongly, in private, on behalf of their constituents. My hon. Friend the Member for Chipping Barnet has argued strongly for the commuters on the Northern line, while my hon. Friend the Member for Derby, North and our colleagues the hon. Members for Derbyshire, South (Mrs. Currie) and for Erewash (Mrs. Knight) have argued strongly on behalf of their constituents who work for ABB—Asea Brown Boveri Ltd.
As the House will know, I am chairman of the all-party friends of the Northern line group. I should like briefly to explain the group's purpose. It is not that we are friends of the line as it is now, but we are friends of the line as we would like it to be. We do not seek to put a preservation order on the 1959 trains that run along the line; rather, we would like new trains in 1995.

It is not the function of the all-party group to back a particular option, nor is it for me or the hon. Member for Streatham (Mr. Hill) to tell the Government that they must support ABB or the GEC option. I am quite agnostic about the technical merits of those two schemes. I do not claim any qualifications to enable me to decide between them, but I am determined, as are the other members of the all-party group, to improve the quality of service on the Northern line, which is used by many thousands of our constituents and hundreds of thousands of people every week.
This is the fourth Adjournment debate that I have instituted about the Northern line and London Transport. I hope that it will be the last, because the Government may shortly make a decision that could mean that we no longer have to have such debates. The present management of London Transport and the Government have to tackle the neglect of the past. The Monopolies and Mergers Commission report of 1991 states:
"The deficiencies in the level of service are the result of chronic underinvestment in both new capacity and the replacement and renewal of existing assets."
In the 1960s, public transport was regarded as a declining industry and it was fondly imagined that the motor car could solve the problems of London. It was thought that urban motorways were the answer, and that London could afford to emulate Los Angeles. There was a failure to recognise that urban motorways generate more traffic and are a remarkable example, probably one of the few known to man, of "Says" law. The problems of London could never be solved no matter how many roads were built.
In the early 1980s, the Livingstone or locust years, the Greater London council decided to put the emphasis on lower fares rather than increased investment. It is one of the ironies of London politics that those who argue for a strategic authority for London fail to realise that the pro-road policies of the GLC in the 1960s and early 1970s

231
and its low investment policies in the early and mid-1980s exacerbated the problems that London Transport has today.
The result of the failures and follies of the past is that, today, London's transport system suffers from old trains and antiquated signalling. The Northern line seeks to run into the City and the west end. In the short term, that has been of some assistance, because the City was a particular victim of the recession; but just as it was a victim of recession, so will it benefit from the continuing upturn in the economy. It has been said that at least 10,000 new jobs will be created in the City over the next few years. That means that pressure on the Northern line will become greater.
It is a pleasure to see that many more tourists have come to London this year than ever before. Those tourists arrive in the west end and at the south bank complex after the joy of travelling on the Northern line. Business men and tourists will be disgorged at Waterloo from Eurostar, leaving a train designed for the 21st century and boarding one that was designed in the 1950s and runs on a track that was designed for the 19th century. Of course, it may be said that the Northern line will not move people about much quicker than Eurostar, but we must hope that Eurostar will arrive on time and that trains on the Northern line of the future will arrive somewhat earlier than they do today.
Those of us who listen to London News radio occasionally hear the phrase, "On the Northern line, service is back to normal." What does "service is back to normal" mean? It means trains that are 35 years old, which date from 1959, the year of Harold Macmillan's great election victory. It means signalling that is near the end of its useful life, track that is scarcely the most modern and a dot matrix system that is certainly not infallible in the information that it gives customers. It means embankments close to collapse and a drainage system that is scarcely adequate.
Earlier this year, a train was derailed at Edgware, just outside my constituency. That was followed by the collapse of the embankment between Colindale and Edgware and people had to go by bus rather than by train. So we have a system which is tolerable, at best, and which all too often is liable to suffer from one problem after another.
Of course, it would be churlish not to admit that there have been some improvements. We have seen the new station at the Angel built at a cost of £70 million and a number of stations are being refurbished at the southern end of the Northern line. Better stations may be a useful start, but they are scarcely enough for the passengers on the Northern line.
We have to look at the problem of London Transport in general. The MMC report said that London Underground Ltd. sees the need for an average expenditure of between £700 million and £750 million a year for the remainder of the decade, excluding the cost of new lines and extensions. We should remember that in 1994–95 expenditure is forecast to be £584 million.
Two issues will be determined in the next few weeks. The first is the level of funding for 1995–96. I recognise that there have been problems on the railways, but I do not believe that the signalmen's dispute should be used as an excuse to raid the budget for London Transport. The signalmen's dispute was an one-off factor—something for
232
which the contingency reserve exists rather than an excuse to redirect resources from London Transport to the railways.
If we are to have any redirection of resources within the transport budget, the sensible solution would be to redirect resources from road to rail. There is recognition that public transport has an increasing role to play in curbing the problems of pollution and congestion in our cities.
Of course, it is true that London Underground is enjoying a better 1994–95 than anticipated. For example, the proceeds from bus privatisation have been better than expected a year ago. It is also true that London Underground has had success in cost control and detection of fraud, but the Treasury must recognise that most of the improvements have been due to the initiative and hard work of the management and the men and women who work for London Underground.
What incentive would there be for those people to produce a better performance if they found that the Treasury took all that money away and gave it to some other part of the transport sector? It would be quite wrong to claw back the money that London Underground has generated for itself back to the Treasury. I accept that where we have enjoyed better receipts from the privatisation of buses there may well be a different argument, but there must always be the incentive for the management of London Underground to improve its performance and those extra resources must be powered into the underground rather than being used to shore up some other part of the transport budget.
The second issue which has to be determined very soon is the future of the Northern line itself. In March 1994, London Transport was invited to go out to tender to discover whether trains could be provided for the Northern line under the private finance initiative. We know that very competitive quotations were received from both GEC and ABB Transportation. Both those United Kingdom manufacturers of trains are short of work and, therefore, have been willing to quote very competitive prices.
The tenders fulfil all the criteria of the private finance initiative. Indeed, the policy of no train, no pay, is at the heart of what is proposed. That can only be good news for the passengers on the Northern line. If both ABB and GEC are told, "If you don't produce a train, you don't get paid for that day," there is every incentive for them to improve the level of maintenance. One of the worst things suffered by passengers on the Northern line is to go to Hendon central station at 10 past 7 in the morning and see the ghastly notice, "First train not in service". They know that that is probably due to a defect in maintenance. If the manufacturers are told that if their trains are not in service they will not be paid for that day, they will ensure that every train runs on time. That will benefit the customers of the Northern line and my constituents.
I hope that on Budget day my right hon. and learned Friend the Chancellor will announce, in the public expenditure side of his statement, that he has given the go-ahead to London Underground to sign a deal, be it with either ABB or GEC—that is irrelevant. It is essential that a deal is signed, as it would give a boost to the private finance initiative; it would give a boost to whichever train manufacturer was awarded the deal—at a time when the industry throughout western Europe is suffering from a lack of orders; it would give a further boost to London's

233
economy; and it would mean that many tens of thousands of people who travel on the Northern line every day could look forward to a very much better journey than they enjoy at the moment.
Such a decision would be welcome on both sides of the House and I look forward to the hon. Member for Streatham confirming virtually everything that I have said this evening.
10.16 pm
Mr. Keith Hill: I congratulate the hon. Member for Hendon, South (Mr. Marshall) on his success in introducing this vital debate for Londoners. I am grateful to him for inviting me to speak. It may never happen again, especially after some of his rather provocative remarks earlier this evening. However, it should be recorded that he and I have fought shoulder-to-shoulder in this long campaign on behalf of 1.25 million Londoners. I am sure that we all hope that it is now close to a favourable decision. I want to put on record the stalwart support given to the campaign by my hon. Friends the Members for Hampstead and Hampstead (Ms Jackson) and for Hornsey and Wood Green (Mrs. Roche).
I want to make three brief points. I congratulate all the parties that have contributed to the progress so far in this project. I include in that the Treasury, which, after a certain amount of pushing and pulling, gave the go-ahead to this innovative approach. We all sense that the Department of Transport has consistently given a fair wind to the scheme. The British train builders should also be congratulated on the way in which they have risen to the challenge. I especially congratulate London Underground Ltd. on the extraordinary efficiency with which it has dealt with the procurement and evaluation process. It processed four tenders and whittled them down to two in just four weeks, which is no mean feat and would bear emulation elsewhere.
I strike a cautionary note. We all know that we shall shortly see the benefits of the private finance initiative. However, its value would be negated if London Underground were to suffer any commensurate loss in its non-PFI funding in the aftermath of a positive outcome. To take away with one hand what has been given with the other through the PFI would be to rob the public sector of any future incentive to participate in such initiatives. It would be helpful to have the Minister's assurance that there is no such intention in the Government's approach to the project.
Thirdly and finally, I recognise that the Minister is unlikely to tell us the outcome this evening. It would be nice, but unlikely. But in anticipation of a favourable decision, I hope that when the good news comes it will be regarded not as the end of the process but as the beginning of a continuous series of improvements on the Northern line. The real win for the PFI is not simply that we have a project that is value for money, but that it can be the impetus for wider benefits for all Northern line users. That means more and better services, attracting more passengers and generating the higher revenues needed for further investment—further investment especially, as the hon. Gentleman said, in track and signalling which are in such urgent need of renewal on the Northern line, but also, dare one hope, in extensions
234
of service, not least to my own dear constituency of Streatham where the extension of the Northern line was first promised us as long ago as 1926 and is still anxiously awaited.
10.20 pm
The Minister for Transport in London (Mr. Steve Norris): I join the hon. Member for Streatham (Mr. Hill) in congratulating my hon. Friend the Member for Hendon, South (Mr. Marshall) on having secured his fourth debate on the prospects for and future of the service delivered by the Northern line. He is a doughty chairman of the all-party friends of the Northern line group which, in itself, is a unique achievement. I do not know any other line that has managed to attract such amity, affection and support.
You may not know, Mr. Deputy Speaker, what I fear I know only too well: that my hon. Friend is also good at getting me out at ungodly hours of the morning to enjoy the delights of Golders Green station. I fear that the only disappointment that we have ever experienced on such occasions is that the service has always been perfect. He has been dying to have something fall out of service or break down, but the service has always behaved impeccably.
My hon. Friend is indeed a good friend, but I do not want to underestimate his real contribution to the service on the Northern line. As the constituency Member of Parliament for a number of the stations and many thousands of Londoners who use the line, my hon. Friend has constantly harried and chivvied, argued for and supported the service that his constituents get. He has been a strong advocate of its improvement, as, on the other side of the river, has been the hon. Member for Streatham, who I am delighted to see in his place.
As the hon. Gentleman suggested, the credit for a tremendous improvement in the way that the Northern line currently operates goes not to me or to the Department, but to Dennis Tunnicliffe and the team at LUL who have done a superb job during the past few years in getting rid of the misery line tag that was always attached to the Northern line.
I had some figures just the other day which showed that in the year to date the Northern line has topped the league for the number of scheduled trains in customer service during peak hours-98.8 per cent. in service. That is very good and it is against the background of the acknowledged difficulties in the service in terms of the age of the rolling stock and, more particularly, the delicacy of some of the signalling and power supply equipment. It is a tribute to a management who have got down to the task and to every single one of the men and women who work on that line and who have done very well in turning it round.
One gets little of the flavour nowadays that the real reason why the first train is out of service is that no one bothered to get out of bed. I do not get that feeling any more. It was sometimes the case on the old nationalised railways, but it certainly is not here. The line's history is as my hon. Friend pointed out. The decades of under-investment are embarrassing to both sides of the House. The schedules for London Transport generally and for London Underground show that, in 1970, investment in LT as a whole at 1994–95 prices was £59 million. By 1979, the outgoing Labour Government were spending at the rate of £195 million a year.

235
That sounds a lot, but, as the hon. Member for Streatham has often pointed out, it is nowhere near the amount needed then and doubly needed now, to keep the system in an adequate state of repair and to ensure the continuance of the concept that Dennis Tunnicliffe defined as a decently modern metro. That is an incoherent description in some respects, but we all know exactly what he means.
The investment levels of the past few years in London Transport and London Underground have been staggeringly high. In 1992–93, it was £832 million; in 1993–94, £846 million; and in 1994–95, it will be £999 million. The Government are doing their best to remedy the deficiencies of previous decades, but no one is in any doubt that the mountain to be climbed is extremely high.
In short, that is our challenge. Investment is three times what it was in the early 1980s, and allows us to effect real improvements in certain parts of the service. My hon. Friend the Member for Hendon, South was right to consider the Angel, but that one station cost £72 million—and we have not touched on the stations at the southern end of the Northern line. I see in his place my hon. Friend the Member for Wimbledon (Dr. Goodson-Wickes), who takes a great interest in these matters on behalf of his constituents. He knows the state of some of the stations from the Oval southwards, which are in great need of repair—but against the background of more important priorities.
By common consent, the taxpayer is making a record contribution on the basis of historic comparisons. Once the sale of London Bus subsidiaries is completed, the proceeds will allow London Transport to invest in excess of £100 million this year. That figure is more than LT anticipated because, as my hon. Friend said, the sale proceeds so far have been extremely encouraging. We have not quite reached the end of that exercise.
Also, fares cover costs. As far as I am aware, we are recovering a higher proportion of system costs than any other metro system in Europe—which means that every penny contributed by the taxpayer goes straight into investment rather than funding a shortfall on profit and loss. It is clear that if we want further to accelerate investment, we must look to the only other source of substantial capital—the private sector. My hon. Friend was right to look to the private finance initiative to make even further progress.
236
In that regard, I cannot properly speculate on the outcome of the present competition. The two bidders are in the course of having their individual bids assessed by LT, and it is important that that exercise is conducted with the utmost even-handedness. That is clearly as it should be. The Department, myself and London Underground are making every effort to ensure that that process is completed and we await a final proposal from LUL.
I must enter the sole cautionary note that approval will be given only if the deal that is presented to the Government represents good value for money and transfers a significant risk to the private sector. The Government never have been in the business simply of borrowing money from other institutions in the United Kingdom. The one thing that any Government manage fairly competently in comparison with the private sector generally is borrowing money at pretty fine rates. What has to be present in such a deal is far more than merely an arrangement for leasing. That is what the participants in the exercise and the bidders fully understand.
I am confident that the private sector will be able to deliver a package which will be to the benefit of all. That will mean, of course—I hope that there is all-party agreement on the desirability of this—that, assuming that the outcome were favourable, we would certainly see replacement of the nearly 40-year-old rolling stock on the Northern line many years before it would otherwise have been affordable by a Government of any complexion, if we are to be realistic and as we are able to speak to a sense of all-party agreement on such matters.
We should look for ways in which we can use the private finance initiative further to advance the cause of accelerating that re-investment in a system in which decades of under-investment are presently in evidence. Therefore, I am happy to confirm to my hon. Friend that the private finance initiative never has been seen by my right hon. and learned Friend the Chancellor merely as a substitute for public finance. Of course, there might be occasions when it would be entirely appropriate for that to be the case, but we have a marvellous opportunity which will serve the interests of manufacturers and of London Underground, the operator, and, perhaps most importantly, the users of the line and the taxpayers who fund its investment and improvement. It is surely a very rare event when that juxtaposition can take place.
I welcome the debate and the opportunity to put those remarks on the record. I trust that the House will join me in hoping that the outcome will be favourable.
Question put and agreed to.
Adjourned accordingly at twenty-eight minutes to Eleven o'clock.

DEFENCE

  Service Housing
  Mr. David Shaw
  To ask the Secretary of State for Defence if he will make a statement on plans to improve service housing.

  Mr. Rifkind
  We indicated some time ago that our original proposal to improve the quality and management of the married quarters estate by establishing a housing trust had encountered difficulties. We have therefore been considering alternative options for achieving our underlying objectives of improving housing and management and transferring the married quarters estate to the private sector. NatWest Markets, the merchant bank, has been engaged to help us develop proposals. We believe that there is considerable latent value in the estate which could be realised with the introduction of private sector capital and expertise, for the benefit of service families, the taxpayer and investors alike.

  Meanwhile, we intend to improve the way in which our married quarters are managed. I intend to set up a new, integrated, tri-service housing organisation to manage the married quarters estate as an entity rather than on the single-service lines on which it is currently managed. This organisation will be known as the Defence Housing Executive; and Mr. Michael Robinson, whom we appointed as chief executive designate of the housing trust, has taken charge of planning its formation.

  The Defence Housing Executive will assume responsibility for managing the estate and its maintenance on 1 April 1995, bringing together the various separate staffs. It will be able to maximise efficiencies and provide a better service to service families occupying the houses. The organisation will be established in the first instance as a budgetary unit within the Ministry of Defence, but with a remit to move towards autonomous operation as a likely candidate for privatisation in due course. Much of the work we had already done in planning for the housing trust will be relevant to the new organisation, and I am confident that its establishment will work to the advantage of service families.

DUCHY OF LANCASTER

  Chessington Computer Centre
  Mr. Tracey
  To ask the Chancellor of the Duchy of Lancaster if he will make a statement about the future of Chessington Computer Centre.

  Mr. David Hunt
  When Chessington was launched as an agency and trading fund in April 1993, my predecessor announced that it was a clear candidate for privatisation, but that a decision would be deferred to allow Chessington to develop a commercial track record, and to 2
  give time for private sector competition to become established.

  Chessington has been very successful as an executive agency, for example, achieving all its performance targets in its first year. Over the coming months, I will be reviewing the case for privatisation and how it might best be achieved in the light of developments since April 1993.

  I would welcome contributions to this review from those with an interest in Chessington and its work by January 1995. Further details are in the December issue of the Market Testing Bulletin to be published on 21 November.

TREASURY

  ECOFIN
  Mr. Matthew Banks
  To ask the Chancellor of the Exchequer if he will make a statement on the most recent Council meeting of the Economic and Finance Ministers of the European Union.

  Mr. Kenneth Clarke
  I represented the United Kingdom at the Economic and Finance Council—ECOFIN—of the European Union in Brussels on 7 November.
  The Council discussed the follow-up to the White Paper on growth, competitiveness and employment. On financing of trans-European networks—TENs—the Council accepted that there was a need to deal with projects on a case-by-case basis, with no need for any additional new sources of funding. The chairman of the European investment bank—EIB—stated that he believed that existing requirements could be met through EIB and private sector loans. There were also discussions of the Economic Policy Committee reports on employment aspects and on growth and environment aspects of the White Paper follow-up. On the basis of all these discussions, the presidency agreed to prepare draft ECOFIN conclusions for the European Council.

  The Council discussed presidency reports on the progress of the Commission's proposal for a tax relief for biofuels and the draft directive on taxation of savings. There will be further discussion at the next ECOFIN meeting on 5 December.

  The Council discussed the proposed directive on taxation of interest and royalties payments. In view of the continued lack of agreement on this issue, the presidency agreed to discuss the next steps with the Commission.

  The Council agreed to a presidency non-paper expressing scepticism about Commission suggestions for new forms of financial co-operation with the central and eastern European Countries as part of the pre-accession strategy to be agreed at the Essen European Council.

  No formal votes were taken at the Council meetings.

  Double Taxation Treaties
  Mr. Matthew Banks
  To ask the Chancellor of the Exchequer if he will outline policy on the negotiation of double taxation treaties; and if he will make a statement on recent developments.

  Sir George Young
  The Government are committed to expanding the network of double taxation treaties and modernising existing ones. In this way, we minimise
  3
  barriers to international trade and investment—objectives stressed in the competitiveness White Paper.

  Double taxation treaties are of major importance for United Kingdom business, as they assist taxpayers to trade or invest abroad without the impediment of double taxation or excessive compliance problems. The United Kingdom has led the way in this field by negotiating the largest network of double taxation treaties; we now have treaties with about 100 countries—reflecting our role as a major trading nation.

  Most recently, the House has approved 10 double taxation treaties, including those with Vietnam, Mexico and the Russian Federation. At least another dozen treaties have been signed or are at an advanced stage of negotiation, including those with France, Malta and Argentina.

  Looking to the future, I have approved an Inland Revenue programme of negotiations covering the period to March 1996. This targets, in particular, the fastest developing economies offering greatest growth potential for United Kingdom business. These priorities have been determined following extensive consultation between the Inland Revenue and business, commercial and professional representatives bodies and other Government Departments. This is an excellent example of the benefits of close co-operation between business and the Inland Revenue.

ENVIRONMENT

  Bathing Water
  Mr. David Shaw
  To ask the Secretary of State for the Environment if he will announce the results of this year's bathing water quality monitoring; and if he will make a statement.

  Mr. Atkins
  The monitoring carried out during the 1994 season shows that 82 per cent. of the 457 identified bathing waters in the United Kingdom met the mandatory coliform bacteria standards of the EC bathing water directive. This compares with 80 per cent. in 1993 and 79 per cent. in 1992.

  During the season, over 97 per cent. of the 18,000 coliform samples were within, and in most cases well within, the required standards.

  It is encouraging to see that the continuing improvement in the overall standard of our bathing waters is being maintained. I look forward to further increases in compliance in the near future as more and more schemes in the bathing water improvement programme begin to have an effect. Although we still have some way to go, it is especially encouraging that some waters which have repeatedly failed year on year have this season for the first time achieved the EC standards.

  The main results for the United Kingdom are summarised as follows with details for English and Welsh bathing waters. This information will be placed in the Library of the House today and will be supplemented by a report with more detailed results in due course.
  4

  Bathing Waters Survey-1994 Results for England, Wales, Scotland and Northern Ireland. (Compliance with Bathing Water Directive (76/160/EEC): Coliform Standards).

  Pass

  Fail

  Total

  England and Wales NRA Regions

  Northumbrian1

  29(25)

  5(9)

  34(34)

  Yorkshire1

  20(21)

  2(1)

  22(22)

  Anglian

  27(28)

  6(5)

  33(33)

  Thames

  2(3)

  1(0)

  3(3)

  Southern

  53(58)

  14(9)

  67(67)

  Wessex1

  40(35)

  2(7)

  42(42)

  South West1

  111(107)

  22(26)

  133(133)

  North West

  24(13)

  9(20)

  33(33)

  Welsh

  39(42)

  12(9)

  51(51)

  Total

  345(332)

  73(86)

  418(418)

  Scotland

  16(18)

  7(5)

  23(23)

  Northern Ireland

  15(15)

  1(1)

  16(16

  Grand Total

  376(365)

  81(92)

  457(457)

  (Results for 1993 are in brackets)

  1 Northumbrian and Yorkshire, and South West and Wessex NRA regions have amalgamated, but results are recorded separately here for the purpose of comparison.

SCOTLAND

  Learning Disabilities
  Mr. Kynoch
  To ask the Secretary of State for Scotland what decision he has taken on Lothian health board's strategy for people with learning disabilities; and if he will make a statement.

  Mr. Lang
  I am today announcing my approval of Lothian health board's strategy for people with learning disabilities and the consequent closure of Gogarburn hospital in Edinburgh before the end of the century. The strategy was developed by Lothian health board and other agencies last year and went out to public consultation in the summer. I have considered the proposals carefully and I am satisfied that they will provide for the development of a comprehensive community care service which will enhance the quality of life for people with learning disabilities in Lothian and, in particular, those currently at Gogarburn hospital. I applaud the collaboration between the key agencies that has made the agreement on Gogarburn possible, and their joint commitment to provide the resources needed.

  The board's strategy is for the provision of support, care and treatment services for people with learning disabilities away from hospitals and into the community. The planning and purchasing of long-stay care accommodation, day-time activities and other social care services will become the responsibility of Lothian regional council. Lothian health board will continue to purchase specialist health care, support and treatment services for this group of people as an integral part of the comprehensive network of services proposed. Two NHS units—a challenging behaviour unit and a dual diagnosis unit, for those with both a learning disability and a mental health problem—will be built to provide short-stay, specialist assessment and intensive treatment for in-patients, together with day hospital facilities. The board will also purchase medical and paramedical services

  5
  provided in the community, and these services will be expanded above current levels.

  The public consultation demonstrated wide support for the aims of the strategy and for the closure of Gogarburn hospital which, it is now recognised, is an inappropriate and inaccessible place for the care of people with learning disabilities. There will be a carefully planned and phased rehousing, between now and the end of 1999, of more than 300 residents into supported accommodation in the community. A strong message from the consultation was the importance of ensuring that there was proper alternative accommodation in the community and that all placements would be based on a thorough assessment of the needs of Gogarburn residents.

  I am satisfied that these issues have been fully addressed. A comprehensive network of alternative services will be developed with an emphasis on achieving domestic style accommodation in ordinary housing where possible. This will mean considerable adaptation of properties, the provision of social care and, in some cases, paramedical support, and carefully planned day activities. Each of the residents will be rehoused only after a detailed assessment of his or her social and health care needs has determined exactly what kind of care and accommodation he or she needs. Full account will be taken of the wishes of users and their carers, and particular attention will be given to the needs of the more profoundly handicapped of the residents who will need the most intensive support.

  The board and other agencies have addressed the need to ensure that carers delivering support in the community are appropriate trained and skilled. As far as possible, staff of Gogarburn hospital will be offered the opportunity to deploy their skills in the community and much effort is already being put into identifying new job opportunities and providing retraining where necessary.

  There will be considerable transitional costs incurred in maintaining Gogarburn hospital while alternative provision is being developed and relocation of residents gets under way. I am therefore pledging a substantial amount of bridging finance to meet these double running costs. This will amount to £1.4 million in this financial year, up to £2–8 million in 1995–96 and a further sum in the ensuing years, bringing the total sum up to £14.14 million. In addition, I will provide £2–5 million, spread over the first two years, to help with the capital costs of supported accommodation.

  These substantial Government contributions are a measure of our commitment to ensuring that community care for this vulnerable client group is a success.

  Items in Lieu of Tax
  Mr. Kynoch
  To ask the Secretary of State for Scotland what new items, accepted in lieu of inheritance tax, have been allocated in Scotland.

  Mr. Lang
  I am pleased to announce that I am allocating a collection of items, accepted in lieu of 6
  approximately £108,000 of inheritance tax, to the National Trust for Scotland. The collection of items, mainly consisting of furniture and fittings, was accepted in March 1994 in lieu of tax arising from the death of Major Charles Smiley. The items are historically associated with Castle Fraser, Inverurie, Aberdeenshire, and will remain on display at Castle Fraser in accordance with the condition on which the offer was made.

WALES

  Local Government
  Mr. Sweeney
  To ask the Secretary of State for Wales what representations he received in response to his Department's letter of 7 April "Local Government Reorganisation: Lead Authorities for Certain Financial Matters"; and if he will make a statement.

  Mr. Redwood
  I received several representations on the arrangements for administering superannuation and Welsh Church Act funds from 1 April 1996; and on the closure of the accounts of district and county councils, including their residual loan debt and insurance matters.

  I have considered all the representations carefully and have reached the conclusions set out in the three following tables, which will be given effect by secondary legislation in due course. In the case of superannuation funds, regulations will be made by my right hon. Friend the Secretary of State for the Environment.

  Table 1: Superannuation funds

  Current administering authority

  New administering new authorities

  Covering areas of following authority

  Clwyd

  Flintshire

  Flintshire, Denbighshire, Wrexham

  Dyfed

  Carmarthenshire

  Carmarthenshire, Cardiganshire, Pembrokeshire

  Gwent

  Torfaen

  Torfaen, Blaenau Gwent, Caerphilly, Monmouthshire, Newport

  Gwynedd

  Caernarfonshire and Merionethshire

  Caernarfonshire and Merionethshire, Aberconwy and Colwyn, Anglesey

  Mid Glamorgan

  Rhondda, Cynon, Taff

  Rhondda, Cynon, Taff, Bridgend, Merthyr Tydfil

  Powys

  Powys

  Powys

  South Glamorgan

  Cardiff

  Cardiff, The Vale of Glamorgan

  West Glamorgan

  Swansea

  Swansea, Neath and Port Talbot

  7

  Table 2: Welsh Church Act fluids Each of the new authorities will be vested with and responsible for administering its own Welsh Church Act fund, except in the following cases:

  Current administering authority

  New authority to be vested with fund

  Covering areas of following new authorities

  Gwent

  Monmouthshire

  Monmouthshire, Blaenau-Gwent, Caerphilly, Newport, Torfaen

  Mid Glamorgan

  Rhondda, Cynon, Taff,

  Rhondda, Cynon, Taff, Bridgend, Merthyr Tydfil

  South Glamorgan

  The Vale of Glamorgan

  The Vale of Glamorgan, Cardiff

  Note:

  While the funds would be vested in the three authorities listed in the second column, it would not prevent the other authorities listed in the third column from taking decisions about how to apply income from the funds, whether jointly or individually.

  Table 3: Closure of accounts (includes responsibility for residual loan debt and insurance matters)

  New authority

  to close accounts of

  Aberconwy and Colwyn

  Aberconwy, Colwyn

  Anglesey

  Anglesey

  Blaenau Gwent

  Blaenau Gwent

  Bridgend

  Ogwr

  Caernarfonshire and Merionethshire

  Arfon, Dwyfor, Meirionnydd, Gwynedd

  Caerphilly

  Islwyn, Rhymney Valley

  Cardiff

  Cardiff, South Glamorgan

  Cardiganshire

  Ceredigion

  Carmarthenshire

  Carmarthen, Dinefwr, Llanelli, Dyfed

  Denbighshire

  Rhuddlan, Glyndwr

  Flintshire

  Delyn, Alyn and Deeside, Clwyd

  Merthyr Tydfil

  Merthyr Tydfil

  Monmouthshire

  Monmouth

  Neath and Port Talbot

  Neath, Port Talbot

  Newport

  Newport, Gwent

  Pembrokeshire

  Preseli Pembrokeshire, South Pembrokeshire

  Powys

  Brecknock, Radnorshire, Montgomeryshire, Powys

  Rhondda, Cynon, Taff

  Cynon Valley, Taff Ely, Rhondda, Mid Glamorgan

  Swansea

  Swansea, Lliw Valley, West Glamorgan

  Torfaen

  Torfaen

  8

  Table 3: Closure of accounts (includes responsibility for residual loan debt and insurance matters)

  New authority

  to close accounts of

  The Vale of Glamorgan

  Vale of Glamorgan

  Wrexham

  Wrexham Maelor

OVERSEAS DEVELOPMENT ADMINISTRATION

  Cash Limits
  Mr. Mans
  To ask the Secretary of State for Foreign and Commonwealth Affairs what changes have been made in the 1994–95 cash limit for expenditure by the Overseas Development Administration.

  Mr. Baldry
  Subject to parliamentary approval of the necessary supplementary estimate, the cash limit on the external assistance vote—class II, vote 5—will be increased by £11,068,000 from £1,912,875,000 to £1,923,943,000. The increase includes £10,205,000 in respect of rollover of underspending against the 1993–94 external assistance vote. The gross running costs limit for the ODA has been increased by £863,000 from £73,930,000 to £74,793,000. This includes £860,000 in respect of an end of year flexibility entitlement and a transfer of £3,000 from HM Treasury to pay for the average property price list. The increase will be offset by a transfer and a claim on the reserve and will not, therefore, add to the planned total of public expenditure.

AGRICULTURE, FISHERIES AND FOOD

  Agriculture Council
  Mr. Brazier
  To ask the Minister of Agriculture, Fisheries and Food what was the outcome of the Agriculture Council held in Brussels on 14 November; and if he will make a statement.

  Mr. Waldegrave
  The only decision taken at this Council, at which I represented the United Kingdom, was the adoption by a qualified majority of a measure laying down rules on the definition and designation of butter, margarine and similar spreads. I voted against the measure, on the grounds that it was unnecessary, likely to confuse rather than inform consumers and, through its requirements on the use of designations, liable to inhibit the development of low-fat spreads. Luxembourg also voted against.

  The Council had a general discussion of the Commission's proposals for implementing the agricultural aspects of the Uruguay round settlement, and a further discussion of the Commission's proposals for reforming the wine regime.

SOCIAL SECURITY

  Incapacity Benefit
  Mr. Lidington
  To ask the Secretary of State for Social Security, what proposals he has for the frequency of payments of incapacity benefit.

  Mr. Hague
  Incapacity benefit will normally be paid fortnightly in arrears in line with the arrangements for benefits to unemployed people. Fortnightly payments will also apply to severe disablement allowance and income support for those incapable of work. The new payment frequency will apply to new claims only.

EDUCATION

  Sixth Form Colleges
  Mrs. Angela Knight
  To ask the Secretary of State for Education if she has received the report of the inquiries conducted into affairs at Derby tertiary college, Wilmorton and St Philip's Roman Catholic six form college, Birmingham, and if she will make a statement.

  Mrs. Gillian Shephard
  I have received recommendations from the Further Education Funding Council concerning the governance of Derby tertiary college, Wilmorton and St Philip's Roman Catholic sixth form college, Birmingham following the inquiries conducted respectively by Mr. Michael Shattock and Sir John Caines. I am most grateful to the Council and to Mr. Shattock and Sir John for having carried out the inquiries. Copies of the reports and the recommendations have been placed in the Libraries of both Houses.

  Those affected by the recommendations should have the opportunity to comment on them and on the reports. We have written to all those concerned to invite them to do so. I am mindful of the need to take appropriate action in the interests of sound governance of the colleges. I shall also wish to consider, in consultation with the Further Education Funding Council and others involved, what
  10
  action should be taken to apply any lessons arising from these reports more generally across the further education sector.

  I have been glad to see that, despite their difficulties, the colleges have been providing effective education for their students and I am satisfied that they can continue to do so.

  Common Funding Formula
  Mr. Spring
  To ask the Secretary of State for Education what decision she has made as to where and how the common funding formula will operate in 1995–96.

  Mr. Robin Squire
  My right hon. Friend announced on 14 November 1994 the Government's decision to extend the common funding formula for secondary schools in 1995–96 to all areas where, as at 30 September 1994, 30 per cent. or more of secondary school pupils were being educated in grant-maintained schools. This will mean a further 17 areas on top of five in which the CFF is operating this year.

  A copy of a letter sent by the Department to all grant-maintained schools and local education authorities, explaining the 1995–96 CFF arrangements in more detail, has been placed in the Library.

  Administration Expenditure
  Mr. Spring
  To ask the Secretary of State far Education what further changes she proposes to make to the announced 1994–95 cash and running cost limits on class X, vote 4, administration, within her responsibility.

  Mrs. Gillian Shepherd
  Subject to parliamentary approval of the necessary supplementary estimate, the announced cash limit for class X, vote 4, administration, will be revised from £98,943,000 to £94,922,000.

  The revision to the announced cash limit reflects the decision not to take up my Department's running costs end-year flexibility entitlement of £4,021,000 at this time.

  As a consequence, the announced running costs limit for my Department will also be revised from £94,400,000 to £90,379,000.

Preamble
The House met at three of the clock (Prayers having been read earlier at the Judicial Sitting by the Lord Bishop of Chichester.): The LORD CHANCELLOR on the Woolsack.

Criminal Justice (Scotland) Bill [H.L.]
The Lord Advocate (Lord Rodger of Earlsferry): My Lords, on behalf of my noble and learned friend Lord Fraser of Carmyllie, I beg to introduce a Bill to amend the criminal justice system of Scotland as respects criminal proceedings, the investigation of offences, the sentences and other disposals applicable in respect of certain offences, legal aid in relation to certain appeals, and the treatment of offenders; to amend the law of Scotland in relation to confiscation of the proceeds of, and forfeiture of property used in, crime; to make further provision as respects Scotland in relation to the preparation of jury lists for the purposes of criminal and civil trials; and for connected purposes. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read a first time.—(Lord Rodger of Earlsferry.)
On Question, Bill read a first time, and to be printed.

Agricultural Tenancies Bill [H.L.]
The Parliamentary Secretary, Ministry of Agriculture, Fisheries and Food (Earl Howe): My Lords, I beg to introduce a Bill to make further provision with respect to tenancies which include agricultural land. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read a first time. —(Earl Howe.)
On Question, Bill read a first time, and to be printed.

War Crimes (Supplementary Provisions) Bill [H.L.]
Lord Campbell of Alloway: My Lords, I beg to introduce a Bill to establish a period of limitation as to the institution of proceedings under the War Crimes Act 1991, and to confer jurisdiction on the Court of Appeal (Criminal Division) to adjudicate on the quashing of certain indictments laid under the Act. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read a first time.—(Lord Campbell of Alloway.)
On Question, Bill read a first time, and to be printed.

Committee of Selection
The Chairman of Committees (Lord Boston of Faversham): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That in accordance with Standing Order 61 a Committee of Selection be appointed to select and propose to the House the names of the Lords to form
26
each select committee of the House (except the Committee of Selection itself and any committee otherwise provided for by statute or by order of the House) or any other body not being a select committee referred to it by the Chairman of Committees, and the panel of Deputy Chairmen of Committees; and that the following Lords together with the Chairman of Committees be named of the Committee—
V. Cranborne (L. Privy Seal), L. Denham, L. Graham of Edmonton, L. Harris of Greenwich, B. Hylton-Foster, L. Jenkins of Hillhead, L. Morris of Castle Morris, L. Richard, L. Strathclyde, L. Weatherill.—(The Chairman of Committees.)
On Question, Motion agreed to.

Sustainable Development: Select Committee
The Lord Privy Seal (Viscount Cranborne): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That a Select Committee be appointed to consider the United Kingdom Strategy for Sustainable Development (Cmnd 2426), and in particular to consider:

(i) what specific long-term environmental objectives or targets will be required to achieve continuing policies of sustainable development; and what measures might be required to achieve those targets;

(ii) how environmental factors can best be integrated into other policy areas such as transport, agriculture and energy; and how to account for natural resources and environmental pollution; and

(iii) how changes in lifestyle and attitudes, which will be necessary to contribute to sustainable development, can best be achieved.—(Viscount Cranborne.)

Lord Williams of Elvel: My Lords, I am grateful to the noble Viscount the Leader of the House for introducing this Motion. Can he assure us that, in considering sustainable development, not only will the Select Committee consider the terms of reference as set out in the Motion but that it will also consider a definition of what "sustainable development" means?
Viscount Cranborne: My Lords, I shall draw the attention of the Select Committee to the point made by the noble Lord. I am well aware of the very substantial amount of work that has been published by Her Majesty's Stationery Office on this subject.
On Question, Motion agreed to.

Address in Reply to Her Majesty's Most Gracious Speech
Debate resumed on the Motion moved yesterday by Lord Wade of Chorlton—namely, That a humble Address be presented to Her Majesty as follows:
"Most Gracious Sovereign—We, Your Majesty's most dutiful and loyal subjects, the Lords Spiritual and Temporal in Parliament assembled, beg leave to

27
thank Your Majesty for the most gracious Speech which Your Majesty has addressed to both Houses of Parliament."
3.4 p.m.
The Minister of State, Foreign and Commonwealth Office (Baroness Chalker of Wallasey): My Lords, it is an honour to open your Lordships' debate on the gracious Speech. We look forward very much to the maiden speeches of my noble friends Lord Blaker and Lady Rawlings.
This will be a wide-ranging debate. I shall say a little about the European Union, NATO, Russia, Bosnia, Rwanda and Britain's aid effort. My noble friend Lord Henley will concentrate on defence and security policy.
Each is an area in which Britain plays a crucial part. This reflects the global nature of British interests. Exports are about a quarter of Britain's GDP. We are the third largest providers of direct investment overseas; the sixth largest aid donor. We have major political responsibilities as a permanent member of the United Nations Security Council. We are the fourth largest troop contributor to UN peacekeeping efforts.
These matters have a direct bearing on our political interests and economic wellbeing. I shall start by looking at two building blocks of our international role, the European Union and NATO. One of this Government's highest priorities is to see the new freedoms in central and eastern Europe underpinned by the kind of stability and prosperity western Europe has enjoyed. The European Union has to look outwards, and spread eastwards. This is a year of real progress on both counts. The Swedish vote means we shall welcome three new members to the EU next year; hopefully, Norway will make it four.
The path for the accession in central Europe is also mapped out. Poland, Hungary, the Czech Republic, Slovakia, Bulgaria and Romania are taking good advantage of opportunities to deepen their familiarity with the way the Union works. These are opportunities the Government have actively promoted.
In Poland last week, I heard how they want Britain to go on championing enlargement, and helping them prepare for membership. With enlargement the Union must change. Policies for nine, or for 12, will not work for 16, or for 20, or more. Reform—in agricultural policies above all —will be essential.
This Government want to see tangible results from the 1996 IGC. We must keep up the momentum of enlargement; entrench the principle of subsidiarity; enhance the flexibility of the Union's structures; and ensure we have effective mechanisms for fighting fraud and keeping financial discipline. These are the ingredients of a Europe which brings real benefits to its citizens.
The North Atlantic alliance has to face new demands too. They are much more varied than the ones the alliance was founded to meet. There will be operations in which some allies take part, but others do not. That requires a versatile, adaptable alliance. The NATO Summit in January emphatically reaffirmed the transatlantic link as the bedrock of the alliance. Allies
28
also recognised that a clearer European security and defence identity would strengthen the alliance. But NATO is not an island fortress. Like the European Union, NATO is looking outwards, working to extend its benefits more widely.
Partnership for peace agreements have been launched with 23 countries. The aim is to build trust and to build the habits of working together in the interests of security. Among those 23 partners there are, I have no doubt, future members of the alliance. We welcome that. We must ensure that NATO enlarges without impairing the cohesion and effectiveness of the alliance itself, or the security and stability of Europe.
One of those 23 new NATO partners for peace is Russia. The opportunities for close practical work with Russia are multiplying: the partnership and co-operation agreement signed with the EU this year; Russia's role in the Bosnia contact group, and in discussions with G7 countries. The Government have worked hard to set these new relationships to work. President Yeltsin's visit in September, and Her Majesty the Queen's visit to Russia, showed just how well we have replaced mistrust by friendship, confidence, and co-operation. There are still uncertainties ahead. But the past year has seen welcome gains in political and economic stability in Russia.
We are working closely with Russia over Bosnia. The news from the field is grim; all the more so because, for a while, large areas of Bosnia began to relearn the habits of peace. War has returned to Bihac. Fear of shells and the sniper's bullet haunt the people of Sarajevo.
For months Britain in the contact group has toiled to put together a blueprint for peace. The elements of a solution are on the table; not the perfect solution but a realistic one—one to which all, except the Bosnian Serbs, are prepared to agree. The means of peace are in the hands of the parties in Belgrade, in Zagreb, in Sarajevo, in Pale. Yet still there are calls to lift the embargo and supply the means of war.
It is a sombre prospect; one which we and our troops in UNPROFOR view with deep unease. Throughout the conflict, and throughout the truces, they have worked alongside ODA staff with energy and dedication: bringing food, electricity and water; opening roads, rebuilding bridges.
Our commitment to the relief of suffering in Bosnia has been second to none: over £170 million of assistance; 1,400 convoys delivering 106,000 tonnes of supplies; 31,015 tonnes flown direct into Sarajevo. This could not continue in war. If the risks become unacceptable, then we would be ready to pull our people out.
The Rwanda crisis has tested to the limits the capacity of the international community—and the United Nations—to respond. It is no good blaming the United Nations. The UN is only as effective as its members' own energy and commitment allow. I visited the area around Rwanda twice this year. In all my years of providing help to the sick, the starving, and the dying, I have never seen anything as bad as Goma.

29
The UK has provided over £60 million for Rwandan displaced persons and refugees in neighbouring countries since April. We have provided aircraft cargo-offloading teams; water-tanker teams to deliver to the refugee camps; support to human rights monitors, provided transmission equipment and technical services for a UN radio station. I know your Lordships join me in paying tribute to all those who have done such excellent work from our forces, the ODA and the non-governmental organisations.
We must learn the lessons from Rwanda. The need for quicker, better responses to humanitarian disasters in Africa has never been clearer: nor has the need for more effective action to prevent or contain conflict.
In September my right honourable friend the Foreign Secretary told the United Nations General Assembly of our ideas for a more coherent and effective conflict prevention approach for Africa: from early warning and preventive diplomacy through to humanitarian and peacekeeping deployment on the ground. We are discussing these with our friends in Africa, our partners in Europe and elsewhere, and with the United Nations.
We need to work fast. In too many places, conflict and instability continue. As a result people will be denied the prospect of a more prosperous future. They may even lose their lives. The emergency aid we provide to Bosnia, Rwanda and elsewhere accounts for about 15 per cent. of our total British aid programme. However, it gains around 95 per cent. of the publicity. Sadly, emergency aid often obscures the vital work of supporting long-term development: of providing long-term investment to help prevent future Rwandas—work that is the main business of our overseas aid programme.
The Crown Agents deserve great praise for their work in emergency as well as development aid. I should like to draw your Lordships' attention to the proposals in the Queen's Speech to bring forward legislation on the status of the Crown Agents. They have played a significant but largely unsung part this year in Bosnia and Rwanda.
The proposed Bill to transfer them to a new, independent foundation will enable them to extend their services to their international clients, while maintaining the highest standards of integrity and impartiality. This will assist the Crown Agents to continue and improve their services into the 21st century.
There has been much comment on the Pergau dam project, following the court's decision last week. The Foreign Secretary and I stand by the evidence which we gave to the Select Committee. The Select Committee inquiry went wider than the court judgment. It examined the events of 1988 and the political and commercial background. The court did none of that. The court was not asked to enter, and did not enter, into the question of arms sales. I understand that the judgment has nothing to say on that point. The court has now, for the first time, interpreted the 1980 Act and has decided that the Pergau project falls outside it. We do not yet have the court's written judgment. When we do we shall study it and decide whether to appeal.
30
We have to consider the implications of the judgment for the aid programme as a whole. That applies in particular to the aid and trade provision which was designed by a Labour Government in 1977 to benefit British industry as well as the recipient country. Subject to any appeal we will of course comply with the court's judgment.
Meanwhile, we have asked our officials to review carefully all the projects and activities they fund to see whether there are any others approved under our previous understanding of the Overseas Development and Cooperation Act 1980 which may also fall outside the interpretation of the Act given for the first time last week.
The Pergau project is now 75 per cent. complete and involves over 200 British companies. The judgment does not affect this Government's contractual obligations towards the banks financing the project. What it would mean, if we decide not to appeal, is that the project should not henceforth be financed from funds voted under the Overseas Development and Cooperation Act 1980.
Until we receive and study the written judgment and decide for or against an appeal, we cannot decide on the implications for the aid programme of the money already spent on the Pergau project or on the funds likely to be required from this year to the year 2006. Your Lordships will be informed of the decision when it is taken.
Some critics have tried to use statistics to prove a link between aid and defence sales to several overseas countries. There is simply no truth in these allegations. Of our 10 biggest aid recipients, seven are low income countries in sub-Saharan Africa; three are poor countries in Asia. Nearly 80 per cent. of Britain's bilateral aid to developing countries goes to the poorest countries. The OECD's recent review of the aid programme recognises this focus. This shows that any accusations that our aid flows are determined by defence sales prospects are wholly unfounded.
I recognise public concern about the defence spending in some developing countries. My department works continuously with the IMF and the World Bank to encourage sensible public spending in aid-recipient countries. We take account of excessive military expenditure before we decide aid allocations. In some places, our aid helps turn soldiers into civilians and removes land mines from fields waiting to be tilled. The UN Charter, however, recognises that all, even poor countries, have legitimate defence needs. There is no reason to penalise poor countries because they buy competitive UK defence goods.
Some critics have made particular allegations about Indonesia. OECD classifies Indonesia as a poor country. Its GNP is £440 per head per year. It has a large population at over 180 million, but the Indonesian economy is growing fast on the back of sounder policies. Poverty is being reduced and population growth is falling.
There is a strong economic and social case for Britain to have a substantial aid programme in Indonesia. Other major donors take the same view. Our programme is targeted on human resource development, the

31
environment, good government and transportation. We have repeatedly expressed our concern about Indonesia's human rights record. The Indonesian Government recognise the need for improvement, and we take every opportunity to remind them of that. At no stage has there been any linkage between our aid programme to Indonesia and defence sales.
We must keep the Pergau controversy in perspective. The aid and trade provision as a whole accounts for about 5 per cent. of our total aid of over £2.2 billion. We provide bilateral aid to around 150 countries. Aid is a substantial element in Britain's overseas presence. It also makes a vital contribution to the international effort to promote sustainable development. In our bilateral programme we concentrate 70 per cent. of our aid on Commonwealth countries, many of which are gradually doing better and better.
Aid has to respond to a changing international environment. There has been a rise in the number of countries we assist due to the need to support the transition in eastern and central Europe and the former Soviet Union. British know-how is being demanded more and more right across the world.
We also see very rapid economic growth in some countries as they increase their ability to earn their own way through trade and the attraction of private investment. One welcome feature has been the dramatic growth in private investment in developing countries in recent years which is now higher than the total of official aid flows. This means tighter focusing of our aid. In the middle-income countries, we focus on providing know-how and advice, thereby filling crucial skills gaps. But the bulk of our aid goes to the poorest countries. Here we provide both the expertise and the finance to help them to stand on their own feet.
Some say that we do not do enough to relieve poverty. Some think that the reduction of poverty is just one of a number of targets of the aid programme. Let me make it clear: all our work in the poorest countries is aimed at lasting poverty reduction. Targeted projects which directly raise the living standards of the poor are essential, as are public services projects which benefit the poor—better education, health and family planning, reforms which help the poor to earn more in agriculture, manufacturing and trade, and reforms which make the whole economy healthier and faster growing. Targeting programmes will fail if the policies are wrong and institutions are weak. That is why UK aid helps them to get this right.
Some ill-informed critics snipe at infrastructure projects. These also yield benefits for the poor. In Bangladesh, as a result of our electricity distribution project workshops and factories in textiles and metal-working sprang up to use the newly available electricity. A quarter of a million jobs were created, primarily for poor women.
The other change in our programme is the growing proportion of our aid—now amounting to over 40 per cent.—that flows through multilateral channels.
In this job I am accustomed to receiving brickbats about the size of our aid programme. My concern is not only that; it is also that all our aid should be of the
32
best possible quality. The OECD review earlier this year recognised the high quality of our aid. If more resources become available for the bilateral programme, they would be well spent.
We must also ensure that multilateral aid is of similar high quality. In my speech at the Overseas Development Institute in June this year, I explained that approach. We owe it both to developing countries and to British taxpayers to ensure that multilateral aid is used to the best effect possible.
At home I often hear cynicism, self-doubt and questioning of Britain's role in the world. But when I am abroad, I hear a very different message. It is that Britain matters. British views are taken seriously. British institutions and know-how are respected as among the best in the world.
I suggest that as a nation we must raise our sights. We must recognise that we have real interests and assets worldwide. We must pursue and protect them. This can only be done with an active foreign policy tailored to Britain's needs as we move towards the 21st century. The world, and Britain, deserve nothing less.
3.25p.m.
Baroness Blackstone: My Lords, I look forward to the maiden speeches of the noble Lord, Lord Blaker, and the noble Baroness, Lady Rawlings. Looking back over the past 12 months since we last debated the Address, it is difficult to feel optimistic about the prospects for peace in the world. The civil wars in the former Yugoslavia, in Angola, in the Sudan and in Somalia have continued. The conflicts between India and Pakistan over Kashmir, between Armenia and Azerbaijan over Nagorno-Karabakh, and between Greece and Turkey over Cyprus have continued. The position of the Kurds in Turkey, in Iran and in Iraq remains unresolved. Minorities continue to suffer from oppression—sometimes on a ruthless scale as in East Timor where up to 200,000 people have been killed over the past two decades. In the Gulf, the Iraqi Government continue to be a threat to peace in the region. And in the course of the past year, a new civil war, leading to unspeakable suffering and terrible slaughter, has broken out in Rwanda.
Eric Hobsbawm, Professor Emeritus of History at Birkbeck College, one of the great historians of modern times, has called his new book on the 20th century, The Age of Extremes. It is an apt title for a century in which not far short of 200 million people have been killed in wars all over the world. Can we hope for something better in the last five years of this century? On the evidence of the 1990s, the prospects do not look good.
We do, however, live in an unpredictable era, in an age of uncertainty, and there are events which have taken place in the international arena over the past year which give rise to hope and optimism. Who, for example, would have predicted the peaceful, successful transformation to a multi-racial democratically elected government in South Africa? Only last year in the debate on the Address when the Minister and I spoke about developments in South Africa, we both expressed concern about the unacceptable levels of violence in the pre-election period. At the time neither of us was wholly

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confident that the elections there would be peacefully concluded and that stable government would follow. Miraculously, there is now stability and growth in South Africa. We greatly welcome its return to the Commonwealth and the reference in the gracious Speech to continuing support for the government of South Africa under its remarkable leader, President Mandela—a leader whom we, on these Benches, have supported and greatly admired through his many years of imprisonment by the apartheid regime in South Africa, as well as since his release when he has continued to demonstrate to the world the meaning of courage, of forgiveness, of leadership. I am delighted that Her Majesty the Queen will be visiting South Africa in March.
In the Middle East, the excitement generated by the original breakthrough made by the Palestinians and the Israelis in their search for peace has been dampened by the continuing violence perpetrated by extremists on both sides and the rather slow progress made in the peace process. It is, however, to the great credit of both the Labour Government in Israel and Mr. Arafat that they have refused to be deflected by terrorist violence from continuing the search for long-term peace. We also welcome the recent agreement between Israel and Jordan and hope that a solution can soon be found to the remaining difficulties concerning the withdrawal of Israel from the Golan Heights and a peace agreement with Syria.
We regret, however, the very limited support the international community has so far given to help the Palestinians towards successful self-government in the Gaza Strip and Jericho. May I ask the Minister whether she agrees that more needs to be done and what part the UK Government have been playing in pressing the international community, through its international financial institutions, to do more? It is also vital that further progress should be made in the Israeli withdrawal from the remaining occupied territories, including the West Bank. The closure of the West Bank is a serious obstacle to peace, and continues to sap Palestinian morale and dash their hopes for the future.
Another cause for optimism is that democracy is being maintained in Cambodia, but it is a terribly fragile democracy, and one that is faced with the daunting task of rebuilding Cambodian society. As in the case of the Palestinians, the international community should be doing more to help them in that task. May I also ask the Minister what representations have been made to the Thai Government about illegal contacts between the Thai armed services and the Khmer Rouge? The Khmer Rouge, which was responsible, as we all remember, for killing about 1 million people in the late 1970s, is still a serious threat to peace in Cambodia.
The recent return to Haiti of its elected president is another piece of good news. The fact that that was achieved without serious bloodshed is due in no small part to former President Carter and his successful negotiations with the illegal regime in Haiti. But, as in Cambodia, if democracy is to be re-established on a permanent basis, extensive financial support must be provided by the international community. Haiti is the poorest country in the western hemisphere, and it
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desperately needs extensive economic aid to support the democratic process. Do the UK Government intend to leave that entirely to the USA? What, if any, help is the EDF promising to give Haiti?
The poverty and deprivation suffered by the people of Haiti are just one example of the worldwide problems of preventable disease, poor nutrition, illiteracy and lack of material welfare. Though we have seen dramatic increases in prosperity in the developed countries of the North, in many of the nations of the South there has been little progress. One recent estimate claimed that about two-thirds of the world's population has not benefited from economic growth in the 20th century. The terrible disparities between wealth and poverty around the world are a potent symbol of the failures of our civilisation. Poverty and a shortage of resources can lead to armed conflict, but armed conflict is in itself a cause of poverty as people are displaced and crops and buildings destroyed. I shall leave my noble friend Lord Judd to discuss the effects of the arms trade in some parts of the third world. I wish only to express the deep concern of the Labour Party on two matters. The first is that scarce funding set aside for aid and development purposes should be used, as happened in the case of the Pergau dam, to lubricate arms deals is entirely unacceptable.
Baroness Chalker of Wallasey: No, no!
Baroness Blackstone: My Lords, we note the decision reached in the courts last week which confirms what the Labour Party has said since this sorry story became public: that the Government acted illegally in that matter. We do not accept the lame excuses of the Minister's right honourable friend the Foreign Secretary that, "It wasn't me, guv", and that he had no choice but to proceed. Subject to any appeal which the Minister has mentioned, perhaps she will confirm that the aid budget will be made up, even if she is unable to tell us how at this stage.
I listened with interest to the Minister's comments on claims made in the Observer newspaper last Sunday that a major arms deal with Indonesia is in the offing, with further lubricants from the aid budget. I was glad to have her reassurances on that matter.
On the second matter I wish to raise, perhaps I may once again express regret from these Benches that the proportion of our GNP spent upon aid has fallen to such a lamentably low level. My noble friend Lord Judd will say more about that later.
I welcome the reference in the loyal Address to the UN. As a permanent member of the Security Council, the UK has an important part to play in its reform. The 50th anniversary next year of the founding of the UN is an opportune time to review its role. While the Secretary of State for Foreign Affairs and the noble Baroness the Minister have spoken recently of the need for clarity on where and how to intervene in conflicts, as yet the Government have given no indication of their intentions to establish a framework or set of principles to guide such intervention. There is now clearly an urgent need to establish criteria for British intervention and to develop a multi-national approach to creating such a framework. The ad hoc way in which intra-state conflict

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in particular has been handled is unsatisfactory. It leads to belated action and muddled mandates, as we have seen in turn in Bosnia, in Somalia and in Rwanda. It would, I hope the Minister will agree, be timely to have an early debate on those questions as well as on such matters as how to improve the quality of UN preventive diplomacy, to which she referred, and what we should do to create a more efficient peacekeeping apparatus which is ready to be deployed when needed. The debacle in Rwanda was the most spectacular failure of the present system. I was glad to hear the Minister accept that we must learn the lessons from that.
The Labour Party supports strongly the new initiative the UN has been taking to develop standby arrangements in which member states agree in advance to provide specific force components as building blocks for UN operations. Will the Minister tell the House what position the Government take on standby forces, and will the Minister who is to reply indicate the troops and logistical support that the UK would be willing to make available under those arrangements? Clearly, because of the increasing complexity of UN peacekeeping operations, more than just allocations of troops are needed and specialist units, equipment, logistics and support services, and command and control staff and systems are also needed.
Of course the cost of such commitments are a constraint, and I accept that. However, it is worth pointing out that during 1993–94 the UK's total assessed contributions to UN peacekeeping operations was £119 million out of a total defence budget of £23 billion. There are currently nearly 4,000 service personnel involved in UN peacekeeping operations out of a total of 241,000. In the new world order it is legitimate to ask whether there should not be a greater shift in our defence spending towards UN peacekeeping.
I fear that we shall see a thought-through shift of that kind only when the Government accept the need for a proper defence review. The final debate before the Summer Recess was on the Defence Estimates and I do not want to go over the same ground again, although I know that my noble friend winding up for the Opposition wishes to raise some questions about particular aspects of our defence policy, including the handling of non-proliferation. At this stage I want only to reiterate what my noble friend Lord Williams of Elvel said in the debate at the end of July. The Government are torn in two in their attempts to satisfy two conflicting strands in Tory Party thinking. On the one hand, they wish to cut spending on defence in order to allow for the tax cuts they keep promising are to come; on the other hand, they wish to satisfy traditionalists in the Conservative Party determined to retain the illusion of ultimate defence self-sufficiency in which Britain pretends it is still a great power. They cannot do both.
Turning to Europe, the gracious Speech looked forward to enlargement of the EU. The Labour Party greatly welcomes the accession of Austria, Finland and Sweden, and hopes that Norway will be joining after the referendum there. We particularly welcome the fact that they, like us, believe that Europe should have a strong social dimension as well as a strong economic one. I
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welcome what the Minister said about eastern Europe. The Labour Party is also committed to supporting further enlargement of the EU towards the east. In that context we can only express our profound disappointment at the continuing failure on the part of the UK to build our trade with the countries of central and east Europe in comparison with the much greater success of Germany, and the out-performance of the UK by France and Italy.
The Minister said that we must reform the CAP and she will no doubt agree that until and unless we do so we not only prevent the countries of eastern Europe from having access to our markets for their agricultural products and thereby limit their economic progress, but we also make it far more difficult for these countries to join the EU without imposing huge strains on the existing system. One of the biggest failures of the Government in Europe is that they have not succeeded in winning any battles on the reform of the CAP. It continues to take a huge share of the European budget; it has done little to foster more efficient farming; it is open to fraud; and it has done little to encourage the protection of the environment. I accept that the Government share these views. But they have been in power for more than 15 years and must take some of the blame for the totally unsatisfactory situation which still prevails. Were they not so busy opting out of the central elements of the strategy for continuing integration in the EU they might carry more weight on such issues as the CAP.
That brings me to the central question of where the British Government now stand on the future of Europe. During the previous British presidency the Prime Minister announced that there would be
"no fast track, no slow track, no one left behind."
By the time we reached the Euro-elections this year he had done an enormous U-turn, saying that what is needed is an approach which varies
"when it needs to—multi-track, multi-speed, multi-layered."
That does not appear to have pleased the British electorate much. The Tories did disastrously in those elections and Labour, with 62 MEPs, became the biggest group in the European Parliament. The Prime Minister's problem is that he is not fully in charge of his party. As a result, he is constantly ducking and weaving as he tries to placate first one group in the Conservative Party and then another. It is high time that he and his Government started to determine their policies on Europe in terms of what is right for Britain rather than what is right for the Conservative Party.
Many crucial decisions have to be taken in the Intergovernmental conference in 1996 on the future direction of Europe. On present form, it is hard to imagine that the Government will be in a fit shape to participate constructively in these decisions. In-fighting in the Tory Party rather than rational analysis of how the European Union can best move forward looks likely to dominate the agenda. In contrast, the Labour Party looks forward to playing a positive central role in the shaping of Europe after the next election. We shall, of course, fight for British interests, but we shall do so

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from a position of strength inside the Union rather than the position of weakness into which the Government have now put us in Europe.
We look forward to seeing the Bill on the EU budget referred to in the Address. We note also the recently published report of the Court of Auditors, with its serious criticism of fraud and inefficiency in the Union. We believe that there should now be urgent and vigorous action to root out fraud and improve efficiency. When we have seen the Bill on the EU budget we shall decide whether we need to put down any amendments. We note with interest that the Prime Minister has had to resort to threatening his Back-Benchers with a general election if they do not vote for the Bill in all its essentials. Desperate tactics, but we shall be ready for the general election whenever it occurs. Perhaps the Minister in his reply will tell us what parts of this Bill are essential and what parts are unessential.
I end on the subject of Europe with a question for the Minister. Since the events of Black Wednesday when, with the help of Mr. Soros, Mr. Lamont took us out of the ERM and in so doing devalued the pound, it now looks as though convergence may be reached much sooner than anticipated. It may even be as early as 1997. If that is the case, what line do the Government intend to take on monetary union? Will the opt-out continue while the so-called hard core nations go ahead? I hope that the Minster will do the House the courtesy of not being evasive on this matter.
The Minister raised a number of issues which I do not have time to cover. The Labour Party shares the Government's wish to find a peaceful solution to the many conflicts in Africa. We too are concerned about the threat to democracy in a number of African countries. We endorse continuing support for political and economic reform in Russia and other parts of the Soviet Union. I was a little surprised that the Minister made no reference to the recent decision of the United States to abandon the arms embargo for the Bosnian Moslems. We believe that that is a serious mistake and that the Government share our view.
Foreign policy is an area on which we can sometimes agree and we shall say so when we do. However, there are also a number of areas of disagreement and during the coming Session we shall campaign vigorously for our views to be heard. It is, however, in all our interests to work for a safer, fairer world in which bloodshed and hunger no longer afflict so many of our fellow human beings. That must be our shared goal.
3.45 p.m.
Lord Mayhew: My Lords, the two previous speeches were extremely informative and well received. However, they illustrate the extraordinary difficulty of discussing foreign affairs, overseas aid and defence in a single debate. It is like asking two tennis players to play against each other on different courts; there are plenty of serves but no rallies. The give and take of a debate is its most valuable feature.
I do not know where to begin to comment on the many important subjects that have been raised. The gracious Speech contains an unusual number of foreign and defence policies and policies on overseas aid. I find
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it hard to object to any of its statements of objectives. However, we on these Benches believe that in some cases the Government are not pursuing those aims in the best way and with sufficient zeal. Of course, that does not apply to the search for peace in Northern Ireland. The Prime Minister and Sir Patrick Mayhew continually show exemplary persistence and good sense. Nor can the Prime Minister be accused of lack of zeal as regards our contribution to the European Community budget. He looks likely to succeed in his aim, but it is significant that it needed a hammer to crack so few nutheads in the process. It is with the greatest interest that we look forward to seeing developments on that front. We hope that the Bill is passed.
We on these Benches were most sympathetic to the comments made by the noble Baroness, Lady Blackstone, about the Middle East. We are sorry that the Minister did not touch on this important, topical and worrying issue. Things are not going well in Palestine. On both sides, the forces against peace are strong and terrorism has not been suppressed. Perhaps the noble Baroness, Lady Blackstone, will agree that there are two possible approaches in the present situation. On the one hand, there is the approach associated with the Israeli Prime Minister, Mr. Rabin, that the speed of implementing the peace process must be regulated by the success of the PLO in suppressing terrorism. On the other hand, there is the approach that is often associated with the Israeli Foreign Minister, Mr. Peres, that to slow down the peace process is a way of increasing the enemies of peace and of making it more difficult for the PLO to maintain law and order. In the gracious Speech the Government state that they support the peace process. I take that to associate them with the views of Mr. Peres, which seem to represent the best possible hope for the future.
Of course we agree with the noble Baroness on many of the points that she has made about the need for extending and increasing membership of the European Union and with regard to NATO reaching out to the East. That is certainly part of our thinking in that respect.
We were glad that the gracious Speech gave prominence to the question of nuclear non-proliferation, on which I hope the noble Lord, Lord Henley, will say something in his reply. We are all apt to congratulate ourselves on the fact that today, for the first time for a century and a half or more, there is no credible threat to the security of the United Kingdom. But will that always be so when every day nuclear weapons become easier to make, fissile material becomes easier to acquire and, as Iraq showed, the process is infernally difficult to detect and prevent?
The Government are right to insist on the extension of the non-proliferation treaty and to pressure non-members to join. They are right also with regard to the need for a more powerful and intrusive inspection system. But it is open to doubt whether the Government are aware of the changes needed in their own nuclear policy if they are to make a positive rather than a defensive impact on the conference.

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Perhaps I may speak a little about that in the hope that the noble Lord will reply. The fact is that there are 160 signatories to the non-proliferation treaty and of those, only five—Britain is one—are accepted nuclear powers. The reasons for Britain's privileged position are historical and they no longer apply. We are likely to be challenged at that conference. Voices will be raised to say that we should set an example and abandon our nuclear deterrent. That is not the view held on these Benches, but we wish the Government to understand that if they are to be of any use at all at that conference, they must take certain steps in advance otherwise they will be simply defending themselves during the proceedings.
First, they should reduce the fire power of the British deterrent to a genuine minimum; that is, the minimum needed to inflict unacceptable damage on any adversary. In the old days when Moscow was the nerve centre of the Soviet empire and when it had effective ABM defences, that was thought to be a considerable number of warheads in the Polaris fleet. But times have changed. Today it is surely impossible to conceive of any country in the world contemplating accepting damage of perhaps 12 warheads. I cannot see that at all. And yet the Government's view, as most recently stated, is that Trident will not deploy more than 288 warheads. That figure is too high and must be brought down, especially before the opening of the non-proliferation conference. The new figure of warheads must also be openly acknowledged. The Americans tell us what is the number of their warheads, as do the Russians. Why do the British not do so?
When I raised that point during our last debate on defence, the noble Lord, Lord Henley, courteously sent me a reply which stated:
"It seems entirely reasonable that the United Kingdom, deploying only a minimum deterrent, should be more reticent about revealing precise dealings of its capability than Russia and the United States…I cannot accept the connection you make between our position on this issue and the inspection regime associated with the nuclear non-proliferation treaty".
But the fact is that that connection will be made by the delegates at that conference. They will say to themselves, "Here are the British demanding that we expose ourselves to powerful and intrusive inspection of our civil nuclear industry and yet they are keeping secret about the number of nuclear weapons which they have". The Government will be put on the defensive on that issue and rightly so, especially as transparency with regard to the number of nuclear weapons is essential if there is to be disarmament. I advise the Government to support the German-led demand to establish a nuclear weapons register. They should accept that and show a willingness to comply.
Finally, in advance of the conference, the Government should state more clearly than they have ever done before that the one and only reason for our deterrent is to deter nuclear attack on ourselves or on our allies; that it will never be used against a non-nuclear country; that it will never be used against a non-military target; and that it will never be used first. I believe that that should be made clear if the Government are to succeed at the conference.
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While on the subject of weapons of mass destruction, why is there no reference in the gracious Speech to legislation for ratifying the chemical weapons convention? That is a straightforward question. The British have a splendid record in that field. We renounced chemical weapons and took the lead as regards that convention. The Foreign Office and the Ministry of Defence have done splendidly. But now the matter seems to be stuck with the Department of Trade and Industry and rumours have it that Mr. Heseltine does not wish to bother the chemical industry with requirements. I should like an answer because other countries are also asking that question.
On these Benches, we have far fewer reservations about the statement of the noble Baroness on Bosnia. We echo the tribute that she paid to our troops there and I add also a tribute to General Rose who continues to carry out the most important, difficult and delicate task with exemplary wisdom.
Of course the Government are right to oppose most strongly the removal of the arms embargo on the Bosnian Moslems. The American position would be bad enough if it were simply in bitter disagreement with its allies, if there were simply disagreement with the unanimous resolutions of the Security Council and NATO—but it is far worse than that. They are taking operational action which undermines the operations of their allies. That is unprecedented and very grave indeed. What will be the value of NATO in future if that is the way in which its members behave?
There could be no stronger argument for pressing forward towards a common European foreign and security policy. The Government committed the country to that when they signed the Maastricht Treaty. We welcome signs that after a period of half-heartedness, they are now proposing to take that commitment more seriously.
On these Benches we have often spelled out the many steps which need to be taken and which can be taken: greater integration of our forces; common procurement; a burden-seeking agreement so that those who contribute most to Europe's security receive financial support from the rest; and closer co-operation also on nuclear weapons' policy with the French. Talks have been going on with the French for years. We are not told about them. Perhaps the noble Lord will enlighten us in his reply. What is the agenda? What progress has been made? What is hoped for as a result of those talks?
There is a further move urgently needed towards a common European security policy. There must be a binding agreement between the European countries to clean up and restrict the sale of arms to the third world. That is essential. Of course it would be better if we could also bring in the non-European countries. Indeed, we should try to do so. But it is no longer enough to argue that if the European countries do not sell those arms then someone else will. It is a profitable trade; but it is wrong to fuel war and oppression in Africa, the Middle East, and in South-East Asia.
It should be laid down, especially with the British Government in mind, that those countries which squander their resources in billion-dollar arms deals do not deserve to receive aid from the rest of the world. It

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seems to me that the British Government have taken the opposite view in the past; namely, that the more arms one buys the more aid one receives. That is disastrous. Of course that can be debated, but it seems to be clear to me. It is an outrage and must be stopped.
I believe that I have covered enough subjects in my speech, although there are many others that could be discussed. I do not wish to sound too negative or pessimistic. Indeed, I must say that, although we have problems overseas today, I can recall a time of about 48 to 50 years ago when to universal astonishment and alarm I was made a junior Minister in the Foreign Office. The problems facing this country then were infinitely worse. We had Stalin in power sweeping westwards. Moreover, we were genuinely worried about the emergence of Stalinist governments in Paris and in Italy. There was also growing and bitter resistance to our rule in India, as well as British troops fighting in Palestine and Greece and in other places where we, and we alone, were responsible for law and order. Advanced age enables one to take a slightly more relaxed view of the undoubted problems with which we are now faced. As I explained, to the extent that we agree with the Government, they can rely upon us absolutely for support.
4.2 p.m.
Lord Craig of Radley: My Lords, the noble Lord, Lord Mayhew, as always, speaks with conviction and determination on deterrent subjects. I do not propose to cross swords with the noble Lord this afternoon on that topic. Instead, I wish to concentrate upon the United Nations and our membership of the Security Council. However, before doing so, perhaps I may welcome the Minister's words about NATO and the positive approach she outlined. There is a strong need to keep NATO very much at the forefront of our minds. We do not want to weaken it. Any alternative suggestions—and one was muted earlier this week—that there should be a North Atlantic association (about which the Secretary of State for Defence talked) need to be thought through most carefully in relation to NATO.
I turn now to the Security Council. There is much that distinguishes us from the other members of the council. We cannot match the military power of the United States. We are massively outnumbered by the Russians and the Chinese. We are nearest to the French in economic and military terms. But they are a republic, and we have our monarchy. Our centuries of tradition and worldwide involvement give us a uniquely different sort of claim to our place at the table. Unless we are prepared to extol, and show pride in, our unique distinguishing features, our claim to a seat on the Security Council may soon be under serious challenge, or at least sniped at by other aspirants who wish to join or to replace us as a permanent member of the council.
Of course, membership brings obligations and also costly commitment. We must be seen to respond to United Nations calls for peacekeeping and other actions. We are well served by our all-volunteer Armed Forces in meeting those contingencies, even at the very shortest of notice. When the Kuwait crisis flared up last month, Royal Air Force aircraft and personnel were en route
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within 24 hours of the decision of Her Majesty's Government on 7th October to respond with military force. Speed of response and reach over thousands of miles are key characteristics of air power. They send a strong political (as well as a military) message around the world, always providing that one has the right people in uniform not only in the front line but also in supporting formations. In that crisis too, the Royal Navy and the Army responded with similar alacrity.
I suggest that our membership of the Security Council rests in part on such commitment and military prowess. However, a weakening of the historic transatlantic special relationship and growing federalising tendencies in Europe could leave support for our United Nations position at risk within a very short time. I am sure that the Government are only too aware of that possibility. How should they respond?
Our claim to Security Council membership must never become that of the unimaginative accountant who can tell us the price of everything but the value of nothing. We shall be hard pushed and, indeed, may not be that motivated as a nation to make startling economic growth and success our only goal. We look to other talismans more in tune with our history and the legacies of the past. We have seen much chipping away at some of those valuable legacies: the monarchy, the Church, the judiciary, even the Armed Forces and other professions. I believe that government could do more to counter those attacks on our national fabric. We adopted the unimaginative accountant's approach to "Britannia", the Royal yacht, and the Royal Flight. In the year that Her Majesty—not only our monarch but also head of the Commonwealth—starts to pay sizeable tax demands with obvious benefit to the Treasury, it seems bizarre to be cutting away, in the name of efficiency and value for money, at some of our unique symbols of nationhood. Where should such an approach end?
Big Ben cannot manage to keep time to atomic clock standards. It is now starting to keel over. Tower Bridge is 100 years old and causes all sorts of road traffic chaos every time it is opened. Should we also forgo those much respected symbols in the same search for efficiency at any price? Even the Palace of Westminster, which is difficult to secure, expensive to run, confrontational in the lay-out of its Chambers and outmoded in terms of most of today's democracies, might be eyed with my accountant's misgivings. We seem to have started on the slippery slope. I hope that wise counsels will prevail before we lose the lot along with all sense of national pride and the respect of the rest of the world—a respect which, however intangible its roots, bolsters our United Nations standing. I welcome the Minister's words on that topic.
Against a background of parsimony and of sometimes seeing the smaller picture at the expense of the big, is it any wonder that we are now in our third review of defence spending since Options for Change only four years ago? Whatever the pressures on our economy, I begin to wonder if the Government fully understand the human dimension to each and every review.
Reviews cause great uncertainty in the minds of soldiers, sailors and airmen and their families. A review is not the same as re-ordering the goods on a

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supermarket shelf, adding a few here, removing a number of unpopular lines elsewhere. You cannot move people about like items on a shelf. They have feelings and aspirations for themselves and their families. As volunteers they are unique in having a commitment to service and to facing personal risk and danger; a commitment which is surely not driven by financial reward alone. Anyone who joins the public service to make his fortune is surely barking up the wrong tree. But that serviceman and woman's commitment becomes sorely tested when repeated promises of stability next year appear to be forgotten in a new chase for defence cost savings. Belief in promises gives way to cynicism.
The troubled housing trust initiative to sell off 69,000 Ministry of Defence married quarters, and Mr. Bett's independent review, are seen by many as ineptly timed and doing further damage to service morale. Service families, many with the father away from home on operational duties for six months or more each year, are very concerned about the future arrangements for married quarters—so much is unresolved and rumours are rife—and for the education of their children. Secondary medical care is also not fully resolved and causes further worry to servicemen and their families. These matters need to be clarified with the greatest of urgency. If the Government are unable to do so quickly, they must be honest enough to tell the servicemen so. We owe it to our volunteer Armed Forces, who act so promptly and bravely to meet political objectives and do so much to sustain our country's claim to a seat on the Security Council, to treat them with the consideration that they so richly deserve.
4.12 p.m.
Lord Howe of Aberavon: My Lords, it is a pleasure to be able to follow the noble and gallant Lord, Lord Craig of Radley and to endorse without qualification the powerful diplomatic case made by a distinguished soldier in support of Britain's role at the United Nations. It is a pleasure also to look forward to the maiden speeches we are to hear from my noble friends Lord Blaker and Lady Rawlings, with each of whom I have had the pleasure of working in political partnership at different times over the years. If I may say so, I welcome the characteristic quality, candour and courage of the speech we heard from the Dispatch Box by my noble friend Lady Chalker. Speaking as one who served with her for many years, I have nothing but admiration for the continued distinction and devotion which she brings to a difficult task in Britain's service around the world.
I welcome and endorse, if I may do so, her remarks about the Pergau dam and the aid programme in that respect. I shall not now be drawn into a detailed analysis of that topic but I shall just add one word. In the whole of that discussion I have heard no credible suggestion that any of the Ministers or officials involved in any of the decisions was ever concerned at any stage with anything other than the promotion of perfectly proper, although sometimes conflicting, British interests. That is something which sometimes tends to be overlooked in that difficult debate.
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I welcome too the recognition by the noble Baroness of the importance of the European Union and of Britain's relations with it. I sometimes wonder at the extent to which so much of the debate in this country and in our national press about foreign policy is conducted in terms often of over-simplified hostility to European institutions, even to the European continent itself, as though we could somehow, if we had our way, detach ourselves altogether from this beastly place of which we are inescapably a part. I do not know whether one should be distressed by the over-simplicity of that debate or comforted by the fact that the debate takes place at all. As I am by temperament an optimist, I am on the whole more comforted than dismayed because the scale of our discussion of these European questions shows an awareness of, and on good days a positive reaction to, the responsibilities which we owe to the world in which we live.
Does not the part played, for example, by Her Majesty's forces in Bosnia—I join with noble Lords in paying tribute to that—contrast (I say this without any sense of hostility) with the necessarily more limited perception of American public opinion in relation to some of the issues close to us here in Europe? They are able to enjoy some of the detachment that flows both from their geographical scale and their geographical remoteness. I think that the debate to which I have referred shows a British understanding of the essentially European foundation of any discussion of our role in the world because so many of the hazards and so many of the opportunities that arise do so in and from our continent and from our relations with it.
Consider, for example, the host of problems that have arisen and that continue to arise from the break-up of the former Soviet Union and its bloc. First, within the union itself and within Russia itself people are still struggling with formidable economic problems. It is a comfort and a reassurance to see the way in which, for the moment at least, the balance of economic policy-making seems to have tilted in the direction of sustainable wisdom, even perhaps sustainable development. But secondly, and less often discussed, there are the serious problems of the Ukraine. The noble Baroness, Lady Williams of Crosby, is not in her place today. She and I both serve, rather to our surprise initially I think, as members of the Economic Advisory Council of the Supreme Rada of that country. We serve with a gallery of distinguished colleagues—we do not often meet as such—which include Messrs. Biedenkopf, Barre, Brzezinski and others and we are led by the chairmanship of Bohdan Hawrylyshyn.
I hope I may say a little more about that matter. The problems of that country were well analysed by our distinguished ambassador there, Simon Hemans, in a talk that he gave to RUSI on the 20th of last month which amounts to the following. It is three years since the Ukraine achieved its independence but it did so at such a time and in such a fashion that at the moment of independence there was consensus on almost only one matter; namely, independence itself. The people in the Ukraine found themselves confronting a range of problems such as those which confronted the United States in 1776, 1861 and 1931 simultaneously without

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any kind of preparation for that task, with no governmental machinery that was appropriate for handling that task, with no people—I say this with respect—really qualified to run the government in such circumstances, and with no consensus on the kind of nation that they wanted to be. It is little wonder that they found themselves floundering more than most. However, I think the House will agree that the Ukraine is too big, too important, too strategic and too central in our European affairs for decisions about her future to be left entirely in the hands of fate. If to no one else, it is to Europeans a matter of huge importance what happens to that country, and to Britain too. However, it is certainly not a problem that Britain can tackle alone.
Happily, in the Ukraine today consensus is now much closer than it has ever been before. Their early understandable instinct to renounce nuclear status has been reconfirmed by their Parliament, and the delivery for dismantlement of their weapons is going ahead as scheduled. There is now consensus as well on a programme of market directed economic reform, presented to their Parliament by President Kuchma on 11th October, which was very positively endorsed by that Parliament. They accepted most recently a programme for price liberalisation. Of course the key decisions for that country—and they are tough ones—have to be taken largely in Kiev and in the Ukraine itself. But help from the West, and guidance from the West, is of crucial importance—and "The West" means to a very large extent European guidance. Therefore, the need for the European Union to agree on the effective, prompt delivery of that help, as promised to the Ukraine, is of enormous importance.
Bohdan Hawrylyshyn, the chairman of the Advisory Council, said this in a letter to me the other day:
"I genuinely believe that if Western help was forthcoming as promised to Ukraine, the country could really move ahead with economic reforms and thus stabilise both economically and politically, which … would be very much in the interest of Europe and, possibly, of the whole world".
I hope very much that the Government will be able to give a positive response to that plea.
That is just one graphic, compact example of the problems which have arisen from the disintegration of the Russian empire. Another much closer, more long-lasting and formidable problem is that which rages in Bosnia. If we need any reminding that that is an essentially European problem then surely we have secured that reminder with the gravely disturbing effect of the latest shift in the position of the United States. The suspension of the arms embargo will not help the promotion of peace in Bosnia. It will not help the cause of partnership in NATO. It will not help the cause of co-operation in the United Nations Security Council. I say that with the utmost regret.
I say, too, that we Europeans have failed in earlier days to do what was right in relation to the Bosnian problem. But it is surely impossible now to argue the case against the development, even at this eleventh hour, of a more effective common European response to that problem. Balkanisation, whose hugely destructive potential we see all too clearly, is not a disease that we can regard as safely and for ever confined to the
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Balkans. Balkanisation is historically a classic European disease: the disease of conflicting nationalisms, the disease against which the very process of European Union was originally mobilised, the disease against which the European Union has achieved so much and still needs to achieve more.
I cherish, of course, the transatlantic alliance and its historical importance. American concern for Europe is of importance to European security. But we have to be realistic about the reliability of its value from day to day, and not least about the constancy of that commitment in days of democratic turbulence. I think not only of the Bosnian question but also, if we seek a different example, of the current risks in the American reaction to the ratification of the GATT agreement. How is Britain's voice best to be heard effectively on that crucially important economic question?
It is no longer sensible to rely, however much emotionally we should like to do so, on the special relationship on which we have all said so much over the years. Noble Lords may have noticed the remark made in one of the last speeches made in this country by Ambassador Raymond Seitz in April of this year. He said:
"America's transatlantic policy is European in scope. It is not a series of individual or compartmentalised bilateral policies. It is the policy of one continent to another. There is a simple observation that if Britain's voice is less influential in Paris or Bonn, it is likely to be less influential in Washington".
In saying that he echoed almost word for word what Harold Macmillan said in 1962 when he set out the case for his application for this country to join the European Community.
That is a consequence of geopolitical reality. Britain, our country, is a great nation, but it is not a great power. If we need to shape the future destiny of our people, that is best done, if indeed it can be done at all, in partnership with our neighbours within the Union which we have helped to shape and can still do more to shape. As the noble Baroness, Lady Blackstone, pointed out, much needs to be done to make it more effective. I would join with many Euro-sceptics, were it not for their style, in expressing my anxiety about the need to weld an effective common security policy, the need to stamp out fraud, the need to move more effectively for the elimination of subsidies, and above all the need to achieve effective reform of the common agricultural policy. As the noble Baroness pointed out, that is essential for the effective enlargement of the Union.
Above all, I want to prevent the damaging exclusion of this country from an inner core of Europe, if such should come to exist. I want to see this country helping to shape the nature of a common single currency, if there is to be such —and I cannot fail myself to see some wisdom in that prospect.
If we are to succeed in that we should not make every comment about the Union or our partners in it with a sneer or a snarl, or a contorted mixture of both at the same time. We need to convince our partners beyond doubt of our commitment to that enterprise and to the obligations and opportunities which it opens up to us. That is why I welcome so warmly the firmness of the Prime Minister's commitment in another place to the

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early enactment of the European Communities finance Bill. Far from being a craven surrender of British sovereignty, I regard that as a confident assertion of our determination to use that sovereignty effectively in partnership with our neighbours to the best advantage of the people of this country and of the wider world.
4.26 p.m.
Lord Cledwyn of Penrhos: My Lords, I am grateful to the noble Baroness and to my noble friend Lady Blackstone for their wide-ranging speeches, which have set the scene for this debate. As they said, we are looking at vast areas afflicted by complex problems. When I read about the appalling poverty and the dreadful consequences of unnecessary wars in so many countries I ask myself what we in Britain can do.
When I was at school in Anglesey there was a big map on the wall on which the British Empire was coloured red. We were taught that Britain ruled the waves. Some find it difficult today to accept the reality that all that is gone, swept into the history books side by side with the history of Rome and other defunct empires. I believe that the British Empire did far more good than harm, but it no longer exists. Some people take the view that we can now sit back and let events take their course. But that is totally unacceptable. Britain must do its utmost to help resolve the difficulties which are now a blight on humanity.
When the Cold War ended we breathed a huge sigh of relief. It certainly gave the world new opportunities and provided a new framework for international security. For example, it became possible to define strategic interests within limited spheres of influence. It was inevitably a fairly fragile arrangement. The United States concentrates on the Caribbean and Central America while Europe is concerned with the European CIS, the Balkans and the North Africa buffer. In his important speech the noble and learned Lord, Lord Howe of Aberavon, made clear that there are acute problems in Georgia and the Balkans which have to be resolved. However, there are other areas in central and south Asia and parts of Africa which are not on anyone's map. That is serious.
Thus far the security framework is failing to meet the challenges presented by the spread of national and regional conflicts. It does not begin to respond effectively to what is called "the phenomenon of the failed states". Those are the 12 to 15 countries which are unable to provide for internal peace and security and which are divided by different warring groups. They are plunged into what seems unending violence. Let me name some of those countries: Armenia, Bosnia, Somalia, Rwanda, Liberia, Angola, Zaire, Sudan, Burundi, Cambodia, Afghanistan and some CIS states. I note with interest what the noble Baroness said about the need for more effective action in Rwanda. I thoroughly agree with her. Since the Berlin Wall came down, conflicts in the world have escalated to about 152. Across the globe there are over 40 million refugees, most of whom have fled war and civil unrest in their own countries.
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As the House will know, other countries are on the borderline of "failed states". Their communities are tense and unstable. They contain poverty-stricken areas and are beset with ethnic and religious strife. States which spend their limited resources on armaments when their people are starving is one of the greater evils of our time. I shall return to that in a moment.
It is a grim situation that has led to a new domino effect —the further expansion of insecurity encouraged by armaments, poverty, religious and ethnic tensions, and the failure of an international will to intervene in conflicts which do not affect the availability of oil. That is sad, but I regret to say that it is true.
The question that I must put to the Government in this important debate is: what will the international community do about the countries which have failed to govern effectively? I have to confess that I have no ready answer to the question. We can talk about reducing the level of our armaments. We can talk about organising consistent peacekeeping and assisting in the alleviation of the dreadful poverty in all such countries. It is easy to say those things, but achieving the objective is another matter. The sad reality is that some other countries are on the road to disaster. Detecting the countries at risk and working to prevent their ultimate failure is obviously an urgent responsibility which should rest primarily with the United Nations.
The simple point is this. Worldwide tension and instability are increasing dramatically, and very little constructive attention on a world scale is being given to that at present. Perhaps I may put some urgent questions to the Government. First, what will the world community do about this developing calamity? What well-thought-out plans, if any, have the Government to put to the Security Council and to the United Nations about the crisis? Secondly, what organisations in the world arena are in a position to respond effectively to the challenge? Thirdly, how effective are other strong nations in wishing, and working, to resolve the international conflicts which many see as being beyond their immediate strategic interests? Finally, what prospects other than silent and human suffering is the world to offer to the poor, the displaced and the destitute at this time?
Against that background, I find myself distressed and frustrated when I see people who call themselves Christians, Moslems and members of other religions arguing fighting and killing each other over issues which pale into insignificance when compared with the problems that I have sought to address in the debate. The leaders of those countries should pray for forgiveness.
I pay a tribute to the noble Baroness, Lady Chalker. She works hard and conscientiously and has a genuine commitment to overseas aid. We admire her for that. However, the objectives of her department have not been helped by some of the Government's policies. Those have already been referred to. I do not wish to go into the Pergau dam affair in any detail, but it is a classic example of how foreign affairs should not be conducted. Where, for example, did the money donated by Britain to build that dam—a project which has been condemned as unsound—come from? It came from the overseas

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development budget. That was in plain contravention of the Overseas Development and Co-operation Act 1980. Such unscrupulous manipulation of the aid budget was, in my opinion, a disgrace. The Government must now reimburse the aid budget. We hope that the noble Lord, Lord Henley, will confirm that that has been done and that there are no obstacles from the direction of the Treasury. When we think of the suffering of the people in the countries to which I have referred, the story is almost unbelievable.
I read an important leader in The Times of 11th November. It gives a reasonably independent, detached view. I shall read one paragraph.
"The Government is now legally obliged to reimburse the aid budget for the money already disbursed, and to draw on it no further for Pergau. This means that in order to meet its contractual obligations to Malaysia, as it rightly insists that it must, it will have to fund the balance from reserves. Mr. Hurd's lawyers told the court that it did not follow that the overseas aid budget would benefit. That would depend, he said, on 'the well-publicised constraints on public spending'. To penalise ODA to compensate for the expenditure the contingency funds incur would be a shabby ending to an already sordid affair. It would exploit the fungibility of all public spending to the detriment of the budget wrongly raided in the first place. Enough damage has already been done. The aid budget should not be a casualty of ministerial casuistry".
I believe that the Government should consider the implications of that leader carefully.
Finally, perhaps I may draw the House's attention to a meeting of the very first importance to be held in January next year. It is a meeting of the United Nations Security Council at summit level—the second time that this has happened in the history of the United Nations. It is being called to discuss the very matters with which we are concerned in today's debate. A heavy burden of responsibility rests on the Government and with the other countries which will be represented there. I hope that when the noble Lord, Lord Henley, replies, he will say that the Government have positive, constructive proposals to put to the Council. It must be more than a talking shop. There is an opportunity to change the course of history for the better. The meeting must launch a policy to analyse potential conflicts and recommend policies to the Security Council to prevent violence. It must propose the setting up of small monitoring groups which will automatically debate a crisis. Conflicts should be avoided by mediation, fact-finding missions, confidence-building measures and the application of political and economic measures.
I know, of course, that Britain alone cannot resolve these problems. But we can at least be a driving force in the right direction with those qualities and background described by the noble and gallant Lord, Lord Craig, in his excellent speech.
I am glad to hear that the Church of England has produced a report which deals in some detail with the problems and makes important recommendations. I understand that the Synod is to consider the report within a matter of a few days. I hope that the Government, and especially the Prime Minister and the Foreign Secretary, will study the report carefully. The time has come for Britain's foreign policy to be
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analysed carefully again so that it may include and reflect the principles in which the people of this country believe.
4.39 p.m.
Lord Hooson: My Lords, unlike previous speakers, I wish to concentrate solely on that part of the gracious Speech which deals with the Government's European policy. In particular I wish to say something about the words in the speech that:
"They will seek to ensure that the principle of subsidiarity is applied to European legislation. They will promote budgetary discipline in the Union and combat fraud".
Essentially, it seems to me that subsidiarity is at its worst a hope and at its best a guidance. If we remember the words that the noble Baroness used in introducing the debate today, she referred to the need to entrench the principle of subsidiarity. She is then saying that we must go further than having guidance; we must have that principle entrenched. That means that she is really advocating the principle of federalism, with which I happen entirely to agree. It seems to me that the two are, from a different direction, approaching the problem in a way that will converge at a certain point.
Many of the problems of the European Community, such as the widespread fraud, arise surely from the neo-functionalism of the Community's development, with heavy reliance on bureaucratic methods and corporate structures, which are a poor and inadequate alternative to a development based clearly on federal principles. When I say "federal principles", I believe that a federal Europe is a long way away, but eventually it is the direction in which we will go.
Although I very much disagree with the view of Euro-sceptics who continue to fight the battles of 25 and 30 years ago, I have considerable understanding for and sympathy with their exasperation at the way the Government have presented such things, for example, as the outcome of the Maastricht Treaty in so obviously misleading ways, to try to assuage anti-European views. Is it too much to hope that in this Session of Parliament the Government's public attitude towards the development of a united Europe will be positive and not of the dissembling nature which has characterised it in the past?
I have always believed in the goal of a united Europe, but I also believed that the most likely route to it was through the pressure of a threat to our security from a hostile USSR and the communist bloc. The advent of Mr. Gorbachev in his epoch-ending changes within that bloc altered all that. Now that the immediate threat from the Soviet bloc has disappeared, the progress towards European integration has slowed down. It would speed up again immediately if the threat, or something similar to it, reappeared. As my noble friend Lord Mayhew indicated, that could easily happen. However, its disappearance has advantages: we can proceed with a more measured sense of purpose because it is clearly important to take the people of Europe with us and to ensure a sense of allegiance to a European union.
It was the very distinguished American human geographer, Professor Meinig, who said of the United States federation that it was,

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"an expedient developed under duress".
That constitution has been amazingly successful, but nevertheless it has its shortcomings, many born of the circumstances in which it came into existence.
Such shortcomings are more avoidable in Europe and our continent is in itself a much more complicated scenario for integration than was the infant United States of America. Essentially, we have faced, and are still facing now, the sacrifice that has faced people over many centuries as our civilisation evolved, from the time when tribe fought tribe in England, Wales, Scotland and elsewhere in Europe. At one stage or another every tribe, every region, was faced with the loss of a certain amount of sovereignty in a greater interest and we face exactly the same problem today. In this century, after two terrible European wars in which tens of millions were killed and so much misery was caused, I believe that people in the post-war period 20, 30 and 40 years ago came to the conclusion that one must make a sacrifice of some measure of sovereignty, of local independence, in order to guarantee a realistic chance of survival, well-being and progress in the modern world.
For the Government to pretend, as they have over the years, that we have not surrendered a measure of sovereignty at Maastricht, and other places, in the Single European Act in actually joining the EEC is clearly nonsense. Of course we have. The integration of Europe is going on all around us, but with inadequate control and direction. Anyone in business knows that that is taking place. Anyone in the law knows that it is taking place. It is taking place all around us and it seems to me that only the Government deny it.
Take the situation revealed by your Lordships' European Communities Committee with its very fine report on Financial Control and Fraud in the Community (HL Paper 75). That paper was discussed in a fascinating debate in your Lordships' House on 31st October this year, in which I did not take part. The following conclusion was expressed by the noble Lord, Lord Hunt of Tanworth, its chairman:
"Inadequate … control is at the heart of the problem".—[Official Report, 31/10/94; col. 698.]
Despite all the functional expedients suggested by others, and by that committee, to improve the situation problems will remain until there is totally clear legal responsibility, established by law, between the European Community and its member states. The only way of achieving that is to proceed along federal principles.
On 3rd November this year—the last day for Questions in your Lordships' House in the last Session—one Question requested the Government to give a definition of "federalism". It was the noble Baroness who replied and, uncharacteristically, her replies were, to put it mildly, obscure. There have been many definitions of "federalism", some formulated in the United Kingdom. With our history of presenting Canada, Australia, South Africa and other Commonwealth countries with federal constitutions, we have long realised the value of federalism. But, of course, in our history we were presenting federalism
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from the top down. In Europe, we are faced with the problem of federalism from the bottom up. However, federalism is a means of binding together a number of entities while preserving the basic integrity of those entities. In other words, it is a device for being united without necessarily becoming unitary. By its very nature, it must allow for the co-existence of dual allegiances and we are slowly getting used to that idea.
In Europe, one of the problems is the Brussels directives which have an obscure legal position. In some countries they are enforced dramatically by embodying them in law or by administrative action. In other countries, they are regarded as mere guidance. It seems to me that only the United Kingdom, and possibly Germany, treat them always as though they were actually laws as opposed to guidance. Through them, the European Commission in Brussels behaves as though Europe is a unitary authority, which it clearly is not. Furthermore, our officials receive the directives as though accepting that we are part of a unitary authority.
Eventually, if a federal constitution is to be achieved in Europe, then, given its history, it will only be achieved by the existing so-called sovereign states—I call them "so-called" because truly none are so now—giving up some of their authority formally to Brussels while retaining the maximum relevant amount of power possible in their own hands. But we are in the midst of a process which we must recognise of partially controlled and partially uncontrolled integration in Europe. None of the antics of the so-called "Euro-sceptics" will prevent it. It is far too late for that, even if it were desirable. I say that as I was the only Liberal in another place who voted against our entry into Europe. I have often reflected on that, but I thought at the time that I was right. I was in favour of going into Europe at the very outset. I felt that we should have waited until an optimum time for this country before we entered.
What do people now think would happen to the UK if it left the Common Market—a stupid suggestion made by an ex-Chancellor of the Exchequer—when over 60 per cent. of our trade is now with Europe? The rest of Europe would simply not allow us to have the benefits of a free trade area while taking on none of the responsibilities that are implicit in a developing and united Europe. What do they think would happen with huge inward investment from such countries as the United States, Japan and so on, simply because Britain is regarded as the most congenial base for their European activities? A research paper from the House of Commons dated 25th October 1994, which is in your Lordships' Library, gives details of that inward investment. One can see what a high proportion of it goes to this country simply because Britain is regarded as a good base for development of foreign investment into Europe.
It therefore seems to me that subsidiarity is in essence another word for describing the guiding principle in the share-out of responsibilities that are inherent in federalism. There has to be a reduction in the authority of the overall centre, Brussels, to its bare minimum. Other decisions must be taken democratically, at the level nearest to people that is sensibly and humanly

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possible. That therefore surely means that there has to be subsidiarity not only to the former sovereign states within Europe, but within the sovereign states themselves. For the UK it means real devolution to Scotland, Wales and Northern Ireland, and indeed probably to the regions of England. That whole process is essential for our survival and well-being if we are to have the overall umbrella of the Continent of Europe, which is daily becoming less remote and increasingly economically integrated.
The basic problem is therefore the question of the allocation of power between the European government, or centre, and its constituent units, whatever those will eventually be. I can well imagine that in the longer term, following the example of the German constitution in the post-war period and the developments that we see, for example, in Spain, we shall eventually end up with a Europe of the regions. But that is a long process and it is far off at the moment.
For the purposes of this decade, the only powers that are needed at the centre are surely those to ensure: (a) the workings of a common economic market with delegation of all grants to member states to administer, so that we do not have a great clash of interests in administration; (b) the achievement of a single European currency; (c) the creation of a common security policy by building firmly the long overdue European pillar of the Atlantic alliance—and I entirely agree with the remarks made, I believe yesterday, on this problem by Mr. Rifkind and with what was said today by my noble friend Lord Mayhew about the importance of developing the European side of the alliance; (d) a common foreign policy together with, let us face it, the gradual development of a common foreign diplomatic representation for Europe; and (e) to ensure progress towards a commonly accepted European code of law.
There is a huge mutual interest throughout Western Europe, and indeed well beyond, in achieving what will in reality be a form of state which has probably never existed in the world as it is today. We have moved on a long way from the 19th century. We have moved on from the German Federation of which we were very largely the architects in the post-war period. We face different problems today, and different forms of government can emerge. At the same time, the political units, the races of Europe, with their diverse cultures, social habits and so on, are so rooted in time and place that it would be not only just but also sensible and far-seeing to retain the maximum amount of decision-making as close to the people as possible.
How close to the people do this Government think that decisions affecting local and regional matters should be taken? Is it at national government level, at regional level, or at local level? It is a very important point. I am very tempted to put down a Question to the noble Baroness asking not for a definition of "federalism" but for a definition of "subsidiarity". All I
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hope is that the signs in the Queen's Speech of a much more positive approach towards Europe by the Government will be fulfilled during this Session.
4.55 p.m.
Lord Bishop of Worcester: My Lords, I have great sympathy with the noble Lord, Lord Cledwyn of Penrhos, in seeing the dark side of the picture as we look at the world at the present time. Nevertheless, there must be enormous gratitude that since the last gracious Speech from the Throne better news has come out of South Africa and the Middle East—though, as the noble Lord, Lord Mayhew, wisely pointed out, it is but fragile—and also (though it be not foreign affairs) better news from Northern Ireland. The discovery of massive fraud in the European Union must, however, dim the European ideal.
It is sad that we so often see Europe solely in terms of a market for over 300 million people. It is something far more than a market. I wish that people would see it as an ideal which enables us to rally behind the assets that are humanitarian, cultural and spiritual in Europe. I hope and pray that the Churches, if they would only repent of their own divisions, could help Europe to find its soul. To that end I hope that we shall look for co-operation in the fields that I have mentioned.
We need very much to recover the statement that was well known in the 19th century that what is morally wrong can never be politically right. I hope that we as a nation shall play our part in the shaping of Europe, and in shaping it not just as a market. Markets are important; and mercantile countries have always done much for culture and indeed for religion. But we must see beyond mere economic and financial prosperity.
I want to introduce into this debate the question of overseas aid to the poorest people in the world—the issue has already been spoken of, and I want to speak of it again —and the ramifications of the policies of the World Bank and the International Monetary Fund. From this country and from Europe we desperately need to send signals of hope to the poor people and poor nations of the world. After all, the European Union is the world's largest trading bloc. It accounts for 19 per cent. of world trade. In that Union, the United Kingdom should use its influence and leadership to see that we address the poverty of the developing countries, and in the best possible way. The worst thing that can happen is the death of hope. And the worst thing that can happen to young people is for them to be cut off from their future.
It is not in the interests of any of us for the world to be destabilised by poverty and for political extremists, whether in eastern Europe or in the countries of the Southern Hemisphere, to climb to power on the back of despair. At this moment I ought to apologise if I am not here for the summing up. It depends on the length of noble Lords' speeches. Tomorrow morning at 8 a.m. I have a commitment in Worcester, so I shall have to catch the last train from Paddington. But I shall read the summing up in Hansard to see what volume of aid is going to the former Soviet empire. I shall want to know

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how far we have got in reaching the 0.7 per cent. of gross national product which was the recommendation of the Pearson Commission so many years ago.
The World Bank and the International Monetary Fund celebrate their 50th anniversary this year. They were founded at Bretton Woods, and Lewis Preston, the president of the World Bank, has rightly expressed certain pride in their achievements. He speaks of 50 years of achievement in helping to reduce poverty and improve living standards through sustainable growth and investment in people. But I must say that 11 of the main aid charities are of a different opinion. While acknowledging the heritage of Bretton Woods, they believe that, 50 years on, we should re-examine the policies and impact of the World Bank and the International Monetary Fund.
The "structural adjustment programmes", which are required of developing nations when seeking funds, have shown themselves to be detrimental to the poor and to make them poorer. Concern over the detrimental effect of structural adaptation was expressed in the World Bank's internal report. The Secretary-General of the United Nations has warned about the effects of structural adjustment programmes. In Zimbabwe, Nicaragua, Sri Lanka and other countries the required adjustments have led to cutbacks in education, hospital and health care and food, making those countries poorer now than they were 20 years ago.
Obviously, economic adjustments and deflationary measures are necessary. But they have been too stringent for weak economies. A Zimbabwean farmer, Betty Mozira, said: "People who had cattle do not have them any more; bread and maize are very expensive; structural adjustments are killing us". Indeed, in Africa as a whole, where more than 30 countries have embraced structural adjustments, average incomes fell by 20 per cent. during the 1980s, and they were very low to begin with. Unemployment has quadrupled to 100 million. In short, the medicine given by the World Bank and the International Monetary Fund has been too strong. The prescription needs changing.
There is a further criticism. The World Bank is unaccountable to citizens and governments in the developing world. They do not participate in the formulation of policies. Moreover, there has been a call for parliamentary scrutiny of the International Monetary Fund and the World Bank. The average Briton contributes £10 a year to the World Bank. It takes 10 per cent. of our bilateral aid. Cannot there be an annual report to Parliament, giving information to MPs in as transparent a way as possible? Cannot there be an annual debate on that report? Should not there also be Select Committee hearings on the operations of the World Bank and the International Monetary Fund and the work of the United Kingdom executive director, in which the Overseas Development Administration should be involved?
With regard to democratisation of the World Bank, it should be remembered that so far back as 1979 in the Brandt Report, there was a call for bargaining between countries of the southern and northern hemispheres to
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be done on a more equal basis and for the sharing of power between the givers and receivers of aid. I should like to know how far that has gone.
In the light of the Pergau judgment, it would seem hardly necessary to make the plea that aid be kept strictly separate from arms deals. I should be grateful if it could be confirmed or denied that that particular deal ended in a 400 per cent. payback in defence contracts. I know that a Foreign Office spokesman was reported as saying that we give aid and sell arms but there is no connection between the two. But can we be told whether it is true or false that aid to Indonesia has increased in the past 18 months? Does that have anything to do with the fact that there is the possibility of a very large deal in the offing?
I return to my first plea. The world desperately needs to be seen as a single interlocking whole. There cannot be peace unless there is justice for all. I know that that is accepted by Her Majesty's Government. There is no one to whom I should want to pay greater tribute than the noble Baroness, Lady Chalker, for all that she has done. Indeed, in adopting this theme for my speech I know that I am on fairly difficult ground as she is one of the greatest experts on the whole subject of overseas aid.
As your Lordships' House will wholly agree, we cannot be content that one billion of our fellow human beings are constantly struggling below the poverty line, their children —as I said—cut off from their future. Nor is it in anyone's self-interest for that to continue. So often our own self-interest dictates that which justice demands.
I hope that this speech has been chiefly about what the gracious Speech from the Throne called "a substantial aid programme"—so be it—
"to promote sustainable development and good government".
5.6 p.m.
Lord Blaker: My Lords, having been born in Hong Kong, where members of my family lived and worked for some 60 years, and having received my letters patent on 10th October, a date which has great resonance in the history of China, I hope that the House will allow me to speak for a few minutes about Hong Kong. I read the Official Report of your Lordships' debate on 18th May this year. It is clear that your Lordships already have much information and many statistics about the territory. I hope that I can give some new statistics, or some which may be familiar at least to some noble Lords.
Six million people living in a territory only twice the size of the Isle of Wight have created a society which is a miracle of success. Forty-nine years ago Hong Kong emerged stricken from Japanese occupation, its economy in a state of collapse. Now it is the world's seventh largest trading community and accounts for nearly one quarter of China's GDP. The 1994 World Competitiveness Report shows that it is fourth among the world's major economies, ahead of every European country. It has the world's biggest container port. At present employed in Hong Kong is 40 per cent. of the world's dredger fleet, engaged in preparatory work for the airport and related projects. It has a smaller public sector than any other advanced economy and public

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spending is consistently below 20 per cent. Unemployment is 1.5 per cent. It has a stable and free political system and a free press. It has enjoyed great achievements in housing, education and health. This year crime has fallen for the third year running. It is relatively free from corruption.
We must ask whether that success and way of life can continue beyond 1997. I believe that it can and will do so. First, it is very much in China's interests that it should do so. Hong Kong is China's largest trading partner. It is the biggest investor in China and China is the biggest investor in Hong Kong. Mr. Lu Ping, head of the Hong Kong and Macau office in Peking, said, in a speech which was quoted in your Lordships' House in the debate to which I referred, that China needs:
"a bridge to carry us to the western world and for the western world to come to the China market. Hong Kong has been playing this role all along, and China wants it to continue to do so by retaining its capitalistic characteristic".
I believe that Hong Kong will continue to be as important to China in that context as it has been in the past.
The second main reason why I believe Hong Kong will continue to thrive, as representatives of the Government of China are very clearly aware, is that Hong Kong is an example to Taiwan. There have been changes in Taiwan but this factor has not lost its force in the minds of the rulers in Peking. If Hong Kong is successful after 1997, the prospects for reunification between Taiwan and the mainland are improved.
I believe that there are probably only two situations which could destroy Hong Kong's way of life. The first would be chaos in China comparable to the chaos which existed between the two world wars. That would be to nobody's advantage and I believe it is unlikely. The other situation would be if the Government of China concluded that Hong Kong was being used as a base for the subversion of China. The Chinese, not surprisingly, value stability. They do not want to see Hong Kong used to introduce Western democracy into China. They have a strong sense of history and they must be conscious of the fact that Sun Yat Sen, who was the main author of the successful revolution of 1911 which overthrew the Manchu dynasty, spent a significant part of his early years in Hong Kong. As Mr. Lu Ping said in the same speech from which I have quoted:
"There are some who believe that only when China turns capitalist, that Hong Kong's capitalism can be guaranteed. This is an entirely wrong concept … Chinese leaders are determined to build a strong socialist China. Any movement or action to change this direction may cause chaos and disruption to the Chinese economy. Hence, any foreign government or Hong Kong people trying to exert pressure on the Chinese Government will not succeed. China would not want itself to be rampant with chaos".
I am not saying anything about the case for a gradual move towards democracy in Hong Kong, though I note—this is not often remarked on—that the Basic Law says that the ultimate aim is the election of all the members of the Legislative Council by universal suffrage. What I am suggesting is that the people of Hong Kong, for whom I have a great admiration, would be wise to draw a distinction between democracy in Hong Kong and democracy in China. The Joint Declaration and the principle of "one country, two
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systems" involve Hong Kong people running Hong Kong except in foreign affairs and defence. But I believe that there is an implied bargain. The bargain must be that if China is not to interfere in Hong Kong, Hong Kong should not interfere in the running of China. I am not calling for legislation to restrict free speech in Hong Kong, but I am suggesting that it is wise for the people of Hong Kong to exercise sensible self-restraint by leaving the way China is run to the people who live in China. It is not necessary for China to be democratic for Hong Kong to flourish.
Much is to be done in co-operation with China. I welcome the remarks about Hong Kong in the gracious Speech and the emphasis put there on co-operation with China. Much has been done by the Joint Liaison Group but it is urgent to speed up its work. Both the British and the Hong Kong Government have made clear their wish to see that achieved. Progress has recently been made in relation to the financing of the airport. But even there, two further financial agreements are required before the package is sewn up. There are many other areas for the Joint Liaison Group: air services, the right of abode and the localisation and adaptation of laws. It will be hard going to resolve all those matters before July 1997. A formidable programme of work exists.
In a recent policy statement the Governor emphasised that he and his government would do everything they can to prepare the way for a smooth transfer of government in 1997; they would help the preparatory committee when it is established in 1996; they would give every possible support to the future Chief Executive, when chosen, in preparing to take up his or her responsibilities; they would help the people designated as future members of the Executive Council and principal officers of the future SAR. I welcome this wise attitude and I hope that it will help to dispel suspicion on the part of the Government of China. It is also helpful that the Governor has recently repeated that the fiscal reserves to be handed over in 1997 are still forecast to be 120 billion dollars.
I know from my time as a Minister responsible for Hong Kong in the Foreign and Commonwealth Office, and more recently as chairman of the All Party British-Hong Kong Parliamentary Group, that the United Kingdom and Hong Kong Governments over the years have had three things in mind: first, a determination to observe the Joint Declaration; secondly, a desire to maintain good working relations with the Government of China, which itself is very much in the interests of Hong Kong; thirdly, a firm resolve to do our best for the people of Hong Kong, to whom we have what the Governor has described as "a debt of honour" which we are determined to fulfil. We face a task without precedent. I believe it is possible to carry it through to success.
5.16 p.m.
Lord Kennet: My Lords, by custom, and to my pleasure, it falls to me to congratulate the noble Lord, Lord Blaker, on his maiden speech on behalf of the whole House. He and I have quite a lot in common. We both started life, more or less, in the Foreign Office and I see from the invaluable pages of Who's Who that we

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are both sailing people. I know that this House will benefit as much from his clarity and realism as the House of Commons has over so many years.
I shall take up a thread where the noble and learned Lord, Lord Howe, left it. We sometimes forget that the UN Bosnia operation has been working. There has been a rough peace, and justice is more likely to emerge from even an unjust peace than it is from a resumed war. To us that is clear. But in the United States, labouring under its eighteenth century constitution, in another continent, with little awareness of Balkan history, and little care for other peoples' body bags, the plight of the Bosnian Moslems has touched a national nerve.
For some time now the United States has been inviting the Moslem countries of the world to help the Bosnian Moslems. The Moslem countries—Iran, Saudi Arabia, and so on—send the money or the weapons to Croatia, which keeps half and passes the rest along to the Bosnian Government. The United States itself has made many overflights and airdrops into Bosnia which were not requested by the UN and not accounted for afterwards. Most recently it has sent military missions directly into Bosnia, the latest one being led by General Galvin, a former Supreme Allied Commander Europe and former Chairman of the US Chiefs of Staff. Bosnia seems in fact to be now more or less run by the Americans.
Now, we have to face the US decision to break the UN embargo on direct arms supplies, and thus revive the war. This poses no problems for the Moslem countries which have troops there—Turkey, Bangladesh and Malaysia—but for us in Europe, and especially those of us in the contact group—France, Germany, Russia and this country—it poses the sharpest dilemma we have faced for years.
What are we to do now that the United States has explicitly disregarded a Security Council resolution? The question is: can we keep the contact group in existence at all, and NATO, and even the Security Council itself, come to that? We also have to bear the horrible unease that a people must always feel when we see our soldiers out in front, vulnerable, and put at risk by someone else's politics. I heard what the noble Baroness, Lady Chalker, had to say about pulling out. It cannot be otherwise. There is much more trouble to come in former Yugoslavia, and there is perhaps some obscure consolation in the fact that an office still exists in Vienna which is winding up the affairs of the Austro-Hungarian Empire.
Two new and quite amateurish proposals are being pressed on us Europeans. One is an enlargement of membership of NATO eastwards. It is not appropriate for a country outside this continent to presume to lead us in this matter. We Europeans must work out for ourselves the relationship we want between NATO and the European Union, and between both and CSCE, as part of the whole Maastricht security think-through. Until we have made up our minds, there should be no disconnected political developments in NATO. We must remember that the new Russia cannot even keep the lights on in Siberia. Nine hundred thousand people have evidently simply fled south again, undoing two centuries
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of history. We will better protect the central Europeans and Baits by ensuring good relations with this weak Russia than by pushing a military alliance, which we formed against it all those decades ago, right up to its frontier.
The second amateurish proposal is the one year-old Defense Counter Proliferation Initiative. This is a Pentagon wheeze to persuade us all to spend gigantic sums on developing and buying a new two-pronged force. Prong one: anti-missile missiles that US space-based computers would activate for us when they, the computers, decided that some country—for example, Libya—was launching an attack on us. Prong two: earth-penetrating weaponry with which to destroy other countries' weaponry before it is launched, when that is deemed "proliferation" according to some preset criterion by American equipment in space.
NATO has been persuaded to examine these proposals and is doing so in a committee co-chaired by the United States and France. That committee is to report next month. How comes it that the Government have allowed this thing to go so far without telling Parliament anything about it? I said "a Pentagon wheeze", but perhaps that is too simple. It might be more accurate to say that it is a wheeze of civilian techno-strategists in the Pentagon with powerful defence industry backing. It is in the bad old tradition of Star Wars and the multilateral force. I trust that the Government are very well informed about whether the US military and intelligence people really believe in it.
What would be far wiser would be to consider the possible proliferation of the niftier kinds of weapons of mass destruction into the hands of small groups and even of individuals. That is not an unreal nightmare. The most harmful arms race in the world, in my opinion, is now that between Massachusetts and Texas. In one of these states they build the missiles which might attack another country, and in the other state they build the anti-missile missiles which could shoot down such missiles. From time to time one of them gains the advantage over the other, and so obviously the other has to have a new generation of development.
Let us have a debate on this Counter Proliferation Initiative on the basis of a proper and frank government statement. Meanwhile all sane people must, for once, put their hopes in the Treasury that it will turn this absurd expense down flat, and that the military indecency of putting Europe's security in the brittle hands of American computers in peacetime will make the European chiefs of staff and ministers of defence also turn it down flat. Remember that it was the computers of the United States ship "Vincennes" which shot down the Iranian airbus on a scheduled civilian flight, and that the various "friendly fire" events have been computer-led.
Most of us now know—and I cannot believe that the Government do not—that proliferation today is a political problem, and that military threats do not persuade governments that they do not need weapons of mass destruction, but precisely that they do. How could they not? That is the lesson from Israel, from North Korea in the past year, and of course from Britain in 1945.

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So where does our best future lie? Henry Kissinger's great book on Diplomacy has warned the United States of the dangers that it brings on itself by shying away from anything that smacks of a balance of power or of compromise, and by its pursuit of hegemony even where that is impossible. But we still see the repeated threats of unilateral action against North Korea, Iraq, Libya and Haiti and the desire to set up arms depots all over the globe and to fill available space with satellite networks better to oversee the rest of us—and all this without regard to international law or even to the "decent opinions of mankind".
The arrival of a Republican Congress can only make things worse. I wonder whether the United States is not now going to turn—if it is not perhaps already turning—into an isolationist power subject to short bursts of intervention. We have seen Panama and Somalia and so on and so on. We must remember that the major landing on Haiti—the US-only one that did not happen—had been in preparation for 14 months and was to have been the largest airborne assault since Nijmegen in Holland at the end of the Second World War —larger than anything in Vietnam.
If cycles of inertia and convulsion are likely, then we must think quickly. We cannot be honorary Americans. Membership of the North American Free Trade Area is not open to us. We cannot be half-Europeans: Europeans for business, not Europeans for social programmes, environment, national security, and everything else. We could choose to be remote North Sea islanders whose territory and skills others will be glad to use, but on their terms and not ours. That is what will happen if we continue to bicker over the choice down the corridor and in this place. It is in fact already beginning to happen.
Of course we must remain on good terms with our largest friend and historical ally, but it is time to end our present military dependency and rise up from our political deference. Dependence and deference inspire contempt, and that is already happening, too. If we fear the loss of intelligence, let us at last rejoin France and Germany in the European Space Agency. We should be very welcome. At the same time let us explain to the United States—perhaps our Government would be better placed than any other in the world to do so—that the post-cold war world does not live happily with American "exceptionalism" any more than it will live happily with any other country's claim to unique leadership status. Great wealth and great armaments do not confer the right to lead. Under the law the United States is one among many.
5.28 p.m.
Lord Bridges: My Lords, most of the speeches from the Back-Benches in this debate will concentrate on some particular aspect of foreign policy or defence. I should like to adopt a different approach and to draw the attention of the House to the contrasts which I notice between the contents of the Government's policy, as explained in the gracious Speech, and the current attitude and mood of the nation as a whole. I find this contrast rather disturbing.
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To be effective, the foreign policy of a state must focus on the longer term and engage issues which serve its interests over a lengthy period. Looking at that requirement on a global scale, it is clear that we have witnessed many profound changes over the past few years. Indeed, the landscape has changed in such a fundamental way that we find it hard to comprehend the totality and extent of what has happened.
Since the beginning of this decade in particular we have seen the collapse of the Soviet empire, the disappearance of a menacing military alliance and the fragmentation of the communist world into a number of separate states. Empires do not often fade away so completely or so rapidly as that. We do not yet know the ultimate shape of its successor systems in eastern Europe, the Baltic states, central Asia or the Russian far east. No doubt the noble Baroness, Lady Park of Monmouth, will have some cautionary words for us on that subject a little later. I believe that if we are far-sighted, deliberate and wise, we have an opportunity to influence what happens if we act in conjunction with others.
There are perhaps equally significant changes taking place elsewhere. As other noble Lords have said, in Africa we have witnessed, and in some measure have helped to bring about, the end of the pernicious system of racial intolerance in the republic of South Africa. In the Middle East, there has been a welcome thaw in the relations between Israel and its neighbours although that has been matched by the development of a movement known as "fundamental Islam" which has produced a new atmosphere of apprehension and alarm throughout the region. Indeed, those anxieties have spread to southern Europe where governments in the European Union now call for massive aid projects financed by us, the member states, intended to defuse the rising social tensions in the Maghreb that are caused by "fundamental Islam" and to keep the growing population of North Africa at home rather than emigrating across the Mediterranean.
I am no kind of expert on far eastern affairs, but the pace of Chinese economic change (and its invariable consequence: social upheaval) appear quite extraordinary, even when considered in the context of China's long and tumultuous history. I noted the reassuring words of experience in the skilful maiden speech of the noble Lord, Lord Blaker; but I ask myself whether those processes in China can be carried through without some major acts of repression and violence. That seems to remain an open question.
So it is clear to me at least that in dealing with these problems, and in trying to assess them and to prepare appropriate policies in response, Europe has an essential part to play. Perhaps we have the key role. I notice that our traditional allies and most influential friends in other continents are not at present in a very strong position. The United States—we have to say it—is passing through a difficult period, with the weakest president in office for a good many years. To use their own metaphor, the Americans are in "political gridlock" and seem likely to remain so for the foreseeable future. The country's constitutional arrangements—of 18th century origin, as the noble Lord, Lord Kennet, reminded us—

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for so long admired around the world seem to be showing their less adequate aspects at present. Japan, the economic superpower, is also undergoing its largest political upheaval in a generation. Japan's political system seems to be changing course although it is taking rather a long time.
All that points clearly to the need for European activity and leadership. Much of the burden will fall on the current German Presidency of the Union, and in the New Year, on its French successor. I have no doubt that those two nations are fully conscious of their responsibilities and that they will exercise them in close collaboration with each other, as always in the recent past.
But in this country, by contrast, it is much more difficult to detect any general awareness of our role in those affairs, or indeed much interest in them among the public at large. As so often in the past when military danger was seen to recede, we react by cutting our defence budget and turning our attention to domestic affairs. That is of course a natural reaction—perhaps particularly so in a society like ours with its strong parliamentary tradition, where our lack of international ambition is so evident and where the belief in national independence is so strong. As some of your Lordships may recall, an extreme example of that occurred in the summer of 1809 when, at a critical stage in our struggle against Napoleon, the Parliament of this country devoted two crucial summer months to debating the matrimonial affairs of the then Duke of York. I hope that we shall be able to learn something from that example of past insularity.
The purpose of those remarks is to draw attention to the dangers that we incur by indulging in parish pump politics on the scale that we have seen lately. The issues which so excite and inflame, whether presented by television or the press, bear little relation to the questions which will determine the future prosperity and peace of our nation. The European issue, which has attracted public attention lately, is that of the pending legislation which would increase the Union's own resources, a matter which was decided in principle by the governments, although not by the parliaments, at the Edinburgh Summit two years ago.
Of much greater importance surely is the result of the recent referendum in Sweden and the accession in the new year of at least three of the four states taking part in the current enlargement of the Union. The future of the Union in Europe will be determined more by its composition and membership than by any other single factor. If we also take into account the likelihood that several other states in central Europe will accede in the next decade, it is clear that the whole scale and range of the European Union and its activities is undergoing a great change. That is a policy for which successive British Governments have striven for so long, and as a policy it is working, but it is odd that so little public notice is taken of that success. It will affect the opportunities that are open to all members of the Union in a fundamental way.
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One incidental effect which is much on my mind today is the future of the Irish question. With the United Kingdom and the Republic of Ireland together in the Union as wholehearted partners, that common task is greatly facilitated. Without it, the whole enterprise looks immeasurably more difficult. That is just one example of the way in which our commitment to the Union is so important.
I believe that a conscious effort is needed to put aside, as far as possible, the domestic squabbles in which we indulge at present and to concentrate more on the broader issues of world concern which are basic to our long-term security and prosperity and to the cause of world development, about which a number of us have spoken today. If we fail to meet that challenge, I fear that future historians will point to this period as the moment when the British finally lost their sense of direction and purpose, as so many once great nations have done so often before us.
Of course, the mood of the nation is not something which the Government can or should seek to control. It evolves with its own peculiar, even mysterious, chemistry. But in this House I suggest that we should notice what is happening and use whatever influence we have to recall to the minds of our fellow citizens, and perhaps particularly to those who own, control and edit newspapers and television programmes, the opportunities and responsibilities that we have in a world which is changing so much and so rapidly.
5.40 p.m.
Baroness Rawlings: My Lords, so many of your Lordships have a great experience in foreign affairs that I intervene in this debate with timidity. I hope that your Lordships will show the traditional kindness to one who speaks in the House for the first time. This is a great privilege which I welcome, as I welcome the privilege of following the noble Lord, Lord Bridges, to whom I should like to pay tribute for his excellent speech.
I have been advised by several kind noble Lords that maiden speeches in your Lordships' House should be uncontroversial. So, I hope that your Lordships will bide with me if I speak today on that uncontroversial subject, Europe, as I have spent the past five years as a Member of the European Parliament.
This week we took an important step in line with the rest of Europe. I refer to the start of the National Lottery. Mentioning the National Lottery may seem to stray from this foreign affairs debate, but our heritage and culture are of prime importance to our national identity. Many fear that we are losing that by being members of the European Union.
The National Lottery is expected to provide huge additional resources for our national heritage, the arts, sport and charities. I agree with my noble friend Lord Rothschild who said recently that the National Lottery Act 1993 could easily overtake the National Heritage Act 1980 as being the most important piece of legislation in the heritage field since the Second World War. In boosting our arts, heritage and sport, we are underpinning our culture, which for most of us is the core of our identity and a source of security.

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Since the war, institutions, notably NATO and the European Union, have been devised to strengthen nation states and bring them closer together. Economic interdependence and regular contacts, buttressed by modern technology, have led to greater cultural proximity. Yet, differences between cultures will always remain, and so they should.
Europe was horrifically scarred by two world wars in this century alone, so that, understandably, we are wary of petty nationalism. That should not, however, be confused with the wish to preserve our culture and our national identity. The latter is a noble aspiration, perhaps more appropriately called patriotism, a very different sentiment and one, I am sure that noble Lords would all support. But emphasising cultural distinctiveness to the exclusion of everything else is absurd. Galileo made great discoveries on the principles taught by Bacon; and Einstein built on the vision of Newton.
Culture looks beyond boundaries. While applauding the individuality of our own culture, we cannot overlook the fact that Shakespeare took inspiration from the classics and Inigo Jones from Palladio to create great masterpieces. When the Normans conquered England they brought their art of building cathedrals with them. The English, under much influence from France during the following two centuries, developed their own styles, which, in turn, influenced the French and the Italians. For example the finestrone on the western facade of Venice's ducal palace recalls the windows of Ely Cathedral. The cross-influences and yet distinctiveness of Gothic architecture are such that no one nation can call it its own, but each nation can recognise itself in it. Moreover, culture did not stop at the Elbe. Leonard Cox, our 16th century rhetorician and professor at the University of Cracow, wrote:
"that the Poles breathed Erasmus of Rotterdam".
Therefore, on cultural, not just economic and political grounds, it is entirely logical that the European Union should embrace more members.
Enlargement, especially towards eastern and central Europe, is one of our long-standing objectives, as mentioned in the gracious Speech. My noble friend Lady Thatcher said:
"We have a pressing moral obligation to sustain democracy, and free economies, by bringing these countries into the Community as soon as possible, even though it will require a very long transition period".
I share my noble friend's feelings. For that reason, I became deeply involved with one of those countries—Bulgaria. While in the European Parliament I wrote several reports on Bulgaria and the Europe agreement which was concluded during the British presidency.
We are helping the central and eastern European countries along a difficult road, to civic, political and economic reconstruction through major aid programmes and the Europe agreements, primarily for trade liberalisation. That encouragement is vital to keep those countries on course towards the goal of stable democracy and the doubling of the single market. The economic climate is still fragile. The temptation of protectionism is to be resisted. The European Council in Essen must make good progress in preparing the strategy for accession of the associated countries. If
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those discussions become bogged down in a morass of committees, the Union will fail in one of its central purposes.
To succeed it will be necessary for the Union itself to adapt its policies and institutions to accommodate the new members. None of that should alter the need to preserve national identities.
Those issues will be much debated in the run up to the 1996 intergovernmental conference, as will the controversial issue of a single currency. We are not committed to that; a decision upon it will be made by Parliament. I greatly look forward to the enlightening contributions that your Lordships will make to these complex subjects.
It is imperative that Britain continues to play a major role in that debate, staying right at the heart of Europe, where we are much respected for our integrity and fairness. As William Pitt said:
"England has saved herself by her exertions, and will, as I trust, save Europe by her example."
Enlargement of the Union and the preservation of our national identity are both now central to European affairs. European unity focused originally on reconciling France and Germany. That has been accomplished and we have witnessed an unprecedented period of peace and prosperity in the European Union.
The fall of the Berlin Wall and the subsequent reunification of Germany have raised new problems. We now need to build on what has already been a remarkable achievement. There are great and noble tasks ahead of us.
5.48 p.m.
Lord Redesdale: My Lords, it is with great pleasure that I congratulate the noble Baroness upon her excellent speech and say how fitting it was that she should be given this opportunity to speak for the first time upon a subject about which she knows so much, having so recently been a Member of the European Parliament. I am sure that the House looks forward, as I do, to hearing many more speeches from her.
I was glad that the words "overseas development" were added to the title of today's debate as I do not believe that a debate on global security issues can take place without a discussion on the forms of political stability that exist in developing countries. In the past year a wave of democracy has spread, especially in Africa.
Earlier in the year I had the honour of monitoring the first multi-racial elections in South Africa. From there I went on to monitor the elections in Malawi—the first multi-party elections in 30 years. I have recently returned from monitoring the elections in Mozambique. They were elections which, it is hoped, will lead that country to peace.
However, democratic transition is inevitably a slow and vulnerable process. Angola exemplifies the inherent vulnerability of emerging democracies as political breakdown reversed the progress that had so far been achieved.

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Mechanisms for democratic governance have to be encouraged in parallel with sustainable structural adjustment. In many developing countries, the machinery of government needs to be completely rebuilt. Often the funds do not exist for these purposes. Moreover, the political instability of developing countries is not merely a regional or local concern; it is of strategic importance to the developed world since collapse, as 'in the case of Nigeria, threatens international capital markets.
While it is acknowledged that since the end of the Cold War the nature of conflict has shifted from the interstate to the internal, the link between conflict and social and economic inequalities has only begun to be addressed. It is no coincidence that of the 31 wars raging around the world, a large proportion are in the poorest region; that is sub-Saharan Africa. If for no other reason than the need for a co-integrated approach to global security, the UN Secretary-General, Dr. Boutros-Ghali, declared in September:
"Today we have a deeper understanding of where the sources of troubles lie in our world. We now know that security involves far more than questions of land and weapons. We further realise that the lack of economic, social and political development is the underlying cause of conflict".
The jubilee anniversary of the United Nations in 1995 will provide a unique opportunity to address the problems facing United Nations conflict management. The time has come to renew the role of the UN in the light of its failed missions in Somalia and Angola and its inadequate response to Rwanda and Bosnia.
Somalia has shown the damage that mismanaged international operations can inflict on the recipient country. With the imminent removal of all UN forces and the consequent dismantling of the false local economies that it had generated, the country threatens to fall into deeper chaos. As regards Rwanda, in spite of reports of human rights abuse as early as April and May, the world stood by actually withdrawing a substantial number of United Nations troops whose presence could well have functioned as a deterrent to the genocide. Not until a refugee crisis of unprecedented proportions and reports of the scale of genocide were portrayed on our television screens did the international community decide to take belated action.
The need for a framework of international action in response to conflict-related emergencies is paramount. The provision of resources, instruments and institutional capabilities to guarantee that its operations no longer continue on an ad hoc basis depends on political will. The UK Government should take a lead in pushing for the reforms recommended by consortiums of UN delegates, field experts and NGOs. Among these, the development of a global emergency system to anticipate and prevent conflicts, such as an office for preventive diplomacy, which could advise the Security Council of potential conflicts and recommend policies for action; and, secondly, a permanent stand-by UN peacekeeping force available at minimum notice would be welcome steps to reform. Improved co-ordination, accountability and evaluation of UN agencies must be achieved. Greater representativeness of the UN Security Council
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is important if its military operations are not to be viewed solely as the projects of strategic interest to the west. Above all, the financial resources must be provided to allow the UN to function effectively.
I do not plan to discuss UN reform any further, only to add that the costs of emergency aid would be significantly cut by effective preventive diplomacy. Currently more resources are put into refugee flows than into peacekeeping or preventive strategies. The rise in peacekeeping costs was 3.6 billion US dollars in 1993, the highest ever. It is little next to the defence spending budgets and the profits reaped from arms sales. But the UK is set to reduce contributions to UN specialist agencies such as UNICEF and UNDP between 1994 and 1996 by 7.5 per cent., which is a reduction of £5 million. This does not tally with the speech of the Foreign Minister, Douglas Hurd, to the United Nations on the 28th of September in which he said:
"We will not be able to build up the UN's operation unless we act now to put the UN finances on a sound and sustainable footing for the long term".
There is also a very real concern that donor government contributions to emergency aid is diverting funds away from long-term development programmes. If the Foreign Office is committed to UN conflict management it is imperative that extra funds are found for the ODA contingency reserve for humanitarian emergencies which funds relief work on the ground, such as through NGOs. This will ensure other parts of the aid budget are not robbed for short-term, high profile ODA activities.
At present, current policy means cuts in spending on both conflict situations and post-conflict relief and rehabilitation programmes. It is reprehensible that while global military spending has declined by 3.6 per cent. a year between 1987 and 1991, the resulting peace dividend of 935 billion dollars has not been used to finance the world's social agenda or provide human security, as shown in the 1994 Human Development Report.
Returning to the UN Secretary-General's comment on social and economic hardship as an underlying cause of conflict, I wish to emphasise a demand that has often been made in this House, and which is the sole justification for the aid budget, that aid is poverty-focused.
The disappointing results of ODA project completion reports, which state that a substantial number of projects fail to reach completion, and the low points scored for meeting objective targets, especially projects focusing on women in development, are regrettable. Apart from the shrinking of bilateral aid due to the cuts in the aid budget, the apparent fall in funding to multilateral institutions providing assistance to the poorest developing countries is a cause of serious alarm. In spite of criticisms levied at the Enhanced Structural Adjustment Programme of the IMF, it remains one of its main sources of concessional lending. This year a number of IMF member countries have shown reluctance to replenish the fund to the extent that it has been cut from 6 billion dollars to 4.5 billion dollars. When £35 million-worth of aid has been squandered on the Pergau dam—and further allegations have emerged

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of uneconomic projects—the priorities of the Government's policy for overseas development are surely crying out for clarification.
The late judgment on the Government's illegal action of spending aid money on economically unviable projects under the Overseas Development and Co-operation Act in the Pergau dam affair was no small victory in the courts. It sets a precedent ensuring that abuse of the aid budget will be open to scrutiny. Already the revelation last week of a British £2 million aid-for-arms deal with Indonesia seems in flagrance of UN condemnation of Indonesia's human rights abuse in East Timor. I hope that the allegations about arms sales and Indonesia are false, as they would further damage the concept of aid in Britain.
An example of questionable projects is the £60 million Samarinda gas power station which was paid for with British aid. It appears to be a wasteful investment because what the thinly populated area of Kalimantan needs is not more electricity (of which it has enough) but transmission lines. Apart from directly enriching the "First Family"—virtually all foreign investment plans are negotiated through the "First Family"—it will incur huge environmental costs by speeding up deforestation and pollution in one of South-East Asia's last remaining rainforests. I hope that the Minister will be able to comment on these allegations. The Minister said that there was no linkage to arms and aid. Can she also explain the increase in aid to Indonesia in 1992–93 to £436 million, which is an increase of 200 per cent? That seems to coincide with the date on which that arms deal would have been agreed. Similarly, why is it that aid to Nigeria leapt from £6.3 million in 1988–89 to £67.7 million in 1989–90 at a time when a £280 million contract for tanks was being signed in 1990?
Britain is the world's fourth largest exporter of arms. Recent reports by the World Development Movement based on figures reported to the United Nations Register of Conventional Arms show that British taxpayers last year subsidised the exportation of weapons to mostly third world regimes to the tune of £2 billion. Again, I should like to know what consideration the Government have given to including a recipient country's military expenditure as part of their good governance criteria?
A matter of particular interest to me is the proliferation of land-mines throughout the third world. I recently visited Mozambique where I monitored an election. I counted 30 people who had lost limbs due to land-mines. Land-mines are the cause of constant civilian casualties in Cambodia, Iraq, Kurdistan, Afghanistan, Mozambique and Angola. Cambodia has 30,000 amputees, 4.2 per thousand of the population, which is the world's highest proportion.
Although France, Belgium, Germany, the Netherlands and now Italy have agreed to stop the production and exportation of land-mines indicating the gradual harmonisation of EU policy, Britain continues to develop and export inhumane weapons. Britain has signed the UN Inhumane Weapons Convention but has failed to ratify it. The export ban declared in July was deliberately misleading. It did not include the prohibition of anti-personnel mines that self-destruct and are self-neutralising. Yet those supposedly safe
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land-mines have a 10 per cent. failure rate. The Government maintain that land-mines are "legitimate defensive weapons" if "responsibly" used. Is that "responsible" policy on the part of the Government when they have failed to conduct any research of their own to guarantee the reliability of self-destruct mechanisms? Over 150 MPs called for a total ban of anti-personnel mines in the Early Day Motion No. 361 as well as the immediate ratification of the UN convention. Are the Government going to take action in that regard?
Finally, I draw attention to the fact that the Minister said that arms deals and aid are not linked. I hope that she will be able to ratify that over the next few weeks because I believe that the scandal with regard to Indonesia will continue.
6.3 p.m.
Lord Cockfield: My Lords, it used to be just the plain Foreign Office; then it became the Foreign and Colonial Office; and in due time that gave way to the Foreign and Commonwealth Office. But despite the fact that we have been members of the European Community, now the European Union, for more than 21 years, it still remains just the Foreign and Commonwealth Office. That is despite the fact that arguably Europe is much more important than the other two either separately or taken together.
While on that subject, perhaps I may invite my noble friend the Leader of the House to join the 20th century. When he announced the subject matter for this debate yesterday evening—and I prefer to quote his words rather than a mere footnote on the Order Paper—he said that today:
"the main topics for debate will be foreign affairs, overseas development and defence".—[Official Report, 16/11/94; col. 19.]
Suddenly the Government have added overseas development. No doubt the position is that they regard the Pergau dam as more important than the European Union. I have some doubts as to whether that view will be held when the history of this tragic and bloody century comes to be written.
It may be thought that I am talking merely about the use of words, but in fact words very often reveal the thoughts which exist unexpressed in the darkest recesses of the mind. The time has come when not only the Government but perhaps other people also should have a better order of priorities.
I do not propose to follow the noble Lord, Lord Hooson, in what he said about "federal" and "federalism". I merely seek to help my noble friend Lady Chalker by saying that the Government's policy is obviously based on that well-known dictum:
"When I use a word, it means just what I choose it to mean —neither more nor less".
The author of that dictum was Mr. Humpty Dumpty—and I refer to the one in Alice Through the Looking Glass. I am not making any imputations elsewhere. I shall say no more about federalism.
I turn to the question of the Queen's Speech. I propose to pick out two important items in the speech, both of which have been mentioned. But for the great

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furore which for some unknown reason has erupted in the past few days, I would have thought it unnecessary to refer to the Bill now being introduced to give effect to the decisions taken at the Edinburgh conference on the own resources of the Community. But I start by saying that that was not only a decision that was taken under the British presidency but we need to remember also that the existing level of own resources was 1.2 per cent. of gross national product; the proposition was that that should be increased to 1.35 per cent. by the end of the century. In the end, and largely as a result of pressures from the United Kingdom, from the Prime Minister—I admit with support from Germany and the Netherlands—that figure was reduced to 1.27 per cent. One would have thought that halving the increase proposed was a great achievement in which even the most pessimistic of the Euro-pessimists, or whatever they call themselves, would have taken some satisfaction.
But constitutionally the position is absolutely clear. Here we have an international undertaking entered into not only by the United Kingdom Government but at the instance of the United Kingdom Government. If Parliament was not prepared to pass a Bill giving effect to that undertaking—and it is always open to it not to do so—then it is impossible to see how that Government could survive. There is a maxim of the law that every man is responsible for the natural consequences of his actions. If the Government were to fall, we should know who bore the responsibility for that happening.
Perhaps I may add a few further words. It would be disgraceful if the Government had to rely on the votes of the Opposition in order to validate an undertaking of this kind which had been entered into. In case what I am saying is giving any comfort to the Opposition, I say quite clearly that I have reservations about their conversion to the European cause. It started simply with antipathy to Mrs. Margaret Thatcher and the policies that she was following. Whether that conversion—on the road to Damascus, or what the Opposition may have thought was the road to 10 Downing Street—would ever survive the stresses and pressures of government has not yet been proved and I hope that it never is proved. But so much for that aspect of the gracious Speech in so far as it referred to European affairs.
I turn now to the other matter that I should like to mention; namely, the 1996 intergovernmental conference to which my noble friend Lady Rawlings referred in her most interesting maiden speech. It is a matter of immense importance. I see that the Community has been asked to designate 1996 as the European Year of Lifelong Learning. I hope that the Government will be prepared to enrol in that particular course.
The debate on 1996 has already started. The Social Democratic Party in Germany has published a discussion document, M. Balladur the Prime Minister of France has given a detailed interview to Le Figaro and our own Prime Minister Mr. John Major made a speech of great importance—I do not necessarily agree with it; but it is of great importance—at Leiden. So the debate is now joined. In June of the coming year, what was
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called in the rather peculiar phraseology of the Corfu Summit "The Reflection Group on 1996" is to start meeting under the Spanish presidency. Therefore, it is time enough now for us in your Lordships' House to be seriously considering what are the prospects for 1996 and what policies should be followed.
I do not propose to go into the matter in any particular detail. However, there is one point that I should like to make. If one looks at the Maastricht Treaty and tries to read it—which, I may say, is not at all easy because it is a perfect example of legislation by reference—it will be seen that what the intergovernmental conference is supposed to consider are not the policies themselves but,
"the effectiveness of the mechanisms and the institutions of the Community".
In fact, that is the effect of Article N2 of the treaty read in conjunction with its reference back to the fifth indent of Article B. Therefore, when I say that it is not all that easy to follow, that fact is well illustrated by what I have just said.
There is also a reference to,
"a revision of the policies".
But it is absolutely clear that that is only to the "extent" that revision may be needed to ensure the "effectiveness" of the "mechanisms and the institutions". That is enormously important because there is no authority under the Maastricht Treaty to pull up all the policies by the roots and examine them again, discarding those that we do not like. Nor, I may say, is there any authority for the launch of new policies.
I believe that we already have sufficient policies in the Community, or the Union, both under the Single European Act and under the Maastricht Treaty to keep us busy until well into the next century. It is important to make a success of those policies and not to start spawning new ones which may not be effective and for which there would be no time to give effect to. That is all I wish to say at this stage about the 1996 review. I hope that we shall return to the matter in your Lordships' House and discuss it in some detail before the Government's policy on such matters is enshrined in blocks of concrete. That is the only plea that I make.
In conclusion, I should like to say that the "hang-ups" in this country—and I can think of no better word, despite its lack of eloquence—over closer ties with Europe are understandable, even if they are wrong. Since 1066 this country has not been seriously invaded. For nearly 1,000 years we have developed a civilisation, a culture, an ethos, and a set of policies all of our own. Over that long period of time we have gradually drifted away from the Continent of Europe. To come back into the Continent of Europe (which essentially is what the European Union means) involves an immense task of re-adaptation. However, it is a task that falls not just on our shoulders; it also falls on the shoulders of all the other members of the Union. In fact, it is a coming together of the peoples. It is not a matter of one country making a massive move and the others standing still and doing nothing. That point should be kept constantly in mind.
We also have another problem which is very peculiar to ourselves. In Victorian times we had the most powerful and successful—though not the largest—army

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in the world, we had the largest and the most powerful navy in the world and we were the world's most important industrial power. Today, unfortunately, we are none of those things, although so often in the way that we think and talk we still have, so to speak, the remnants of that imperial outlook trailing along behind us. That again makes the problem of adjustment so very much more difficult. It is difficult for the people and it is difficult for the politicians, but it is a process of adjustment which must be made.
If we are to build a secure future for ourselves, for our country and for future generations, if we are to have a real influence in the world and if we are to pull our weight and to make our policies known, it can only be as part of a strong and effective European Union. Therefore, our efforts must be directed to strengthening the Union and not weakening it. We must help it to grow by the admission of like-minded new members; we must make it more effective in the world whether in politics, in security, in defence or in trade; and we must improve its efficiency, reforming its administration and its institutions to enable it to take decisions resolutely and implement them efficiently.
We cannot always have our own way. But if we play a constructive role and are recognised as so doing, we shall exercise an influence far greater than mere numbers alone would command. That is the challenge with which we are faced. That, ultimately, is the challenge of 1996.
6.18 p.m.
Lord Wright of Richmond: My Lords, I should, first, like to commend the Government for the statement in the gracious Speech that they will work with our partners in the European Union to give greater substance to the agreements between the Union and the countries of Central Europe. In that, as in other aspects of our membership of the European Union, it is vital that Britain should continue to play a central, positive and effective role. There seems to be an increasing danger that public opinion, if not the Government themselves, will become distracted from Britain's true place at the heart of Europe by increasing scepticism—much of it, in my view, misguided—about the benefits to Britain of membership of the European Union; by criticism, however justified and understandable, of some of the regulations emerging from Brussels; and by revelations of fraud and mismanagement within the European institutions.
I believe that we should be very careful not to allow such scepticism or criticism, or what the noble and learned Lord, Lord Howe of Aberavon, described as "over-simplified hostility" and what sometimes sounds dangerously like xenophobic insularity, to sideline us in Europe, or to give ourselves and others the impression that we are not committed to maintaining a central place at the heart of the European Union. At a moment when Sweden has just voted to join the Union, and when others from northern, central and eastern Europe are certain to follow, I believe it would be tragic if we were to remove ourselves, or to appear to be removing ourselves, from that central position of influence. In a week when, for the first time, any British citizen with
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the money to spend on a rail ticket has direct physical access to the continent of Europe, it would be all the more ironic if we were now to appear, or to regard ourselves, as detached Europeans.
Being at the centre of Europe means being at the centre of decision making and meeting our obligations and undertakings as members of the Union. By sniping from the sidelines we shall never use our very considerable potential influence in Europe to the full. More widely, I was also glad to hear the references in the gracious Speech to the Government's intention to continue their efforts to promote a peaceful settlement in the former Yugoslavia; to enhance the capabilities of the United Nations; to support democracy in South Africa and to maintain support for the Middle East peace process—all powerful and welcome signals that the Government propose to maintain a global foreign policy.
There has sometimes been comment, if not criticism, that Britain is still trying to punch above her weight. But if we are to remain permanent members of the Security Council —I agree with the noble and gallant Lord, Lord Craig of Radley, that we must—and continue to exercise a leading, active and positive influence on the world's political and economic fora, such as the United Nations, the Commonwealth, NATO or the Group of Seven, we need to punch with as much weight as we can muster, not sit outside the ring throwing eggs at the boxers.
I also welcome the Government's intention to continue to contribute to NATO's wider role in protecting stability throughout Europe. Recent developments in the United States make it more vital than ever that we continue to play our full part in NATO, and in the security operations conducted under both NATO and United Nations auspices. Our bilateral relationship with the United States, and our long standing intelligence co-operation with the Americans, have come under question in the media in recent weeks. Here again, I think that the image, too often presented in our press, of an Atlanticist Britain somehow hovering on the fringes of the European Union, can only be unhelpful in the context of our relationship with the United States administration and with Congress. If I may continue my earlier metaphor for a moment, and echo the remarks already quoted of the former United States ambassador, Mr. Raymond Seitz, in punching above our weight, we also need to show ourselves as full members of the European boxing team.
The contribution of Britain's Armed Forces and of our diplomatic service in helping to resolve some of the many international crises in the world will not only continue to be invaluable in itself but it can also, I believe, still play a role in persuading the United States to remain committed to the defence of world peace and democracy, and to avoid the sort of sporadic isolationism to which the noble Lord, Lord Kennet, referred. Experience of the past few years, and particularly of the Gulf crisis, has shown that United States commitment to its international and peace-keeping role is still a vital ingredient in the resolution of international conflict.

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I make no apologies for adding a word or two about the work of Her Majesty's diplomatic service. I hope that, more than three years after my retirement from that service, my comments will have acquired at least some semblance of objectivity. It has been an extraordinary achievement on the part of my successors to have been able to staff some 25 additional posts, opened mainly in the capitals of the former Soviet Union, in spite of diminishing resources.
In my new, post-retirement involvement with a number of leading British companies I have been able to see—from the other end of the telescope, as it were—the remarkable service which our diplomatic posts are able to provide in helping Britain's exporters and in encouraging inward investment in this country. I was glad to see a well-deserved tribute to the role of the diplomatic service in attracting inward investment to this country by the Minister for Industry and Energy during a debate on the subject in another place at the end of last month. As the Minister pointed out on that occasion, inward investment not only creates jobs, it also makes a major contribution to British exports. The significant role that the diplomatic service fulfils in encouraging exports and attracting inward investment is, in my view, yet another reason why we should continue to maintain a worldwide diplomatic presence, as also do our colleagues among the present and aspiring permanent members of the Security Council.
In conclusion, perhaps I may add that I was sorry not to see any reference in the gracious Speech to the Government's announced intention to ratify the additional protocols of the Geneva Convention in the coming year. It would be sad if we were unable to be listed among the majority of countries who will have completed their ratification by the time of the International Red Cross conference in December next year. I hope that the Minister will be able to give us a reassurance that it is still the Government's intention to move to ratification of both additional protocols at the earliest opportunity.
6.28 p.m.
Baroness Young: My Lords, I wish to start by congratulating my noble friend Lord Blaker and my noble friend Lady Rawlings on their maiden speeches. They both said much of great interest to us all and I hope that we shall hear from them on many occasions in the future. I would like in my remarks today to speak about part of the world which has barely been touched on but in which I take a great interest, and that is the Caribbean. I first became interested in this part of the world because when I was a Minister in the Foreign Office I had responsibility for the area and since leaving office I have maintained my interest as a vice-president of the West India Committee.
The Caribbean is a part of the world which is easily neglected, if not forgotten, while the attention of all is focused on the great events such as the ending of the cold war, the break-up of the Russian Empire and its effects in Russia and the new republics in eastern Europe and Yugoslavia, our great concern about the great economic growth in the Far East and the
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competition that that will bring for us all, and, as we have heard so much today, the importance of our role in the European Union. Indeed attention focuses on the Caribbean only when there is trouble, as there was in Grenada some years ago and more recently this summer in Haiti. That is the only Caribbean country which has been mentioned today, by the noble Baroness, Lady Blackstone, and the noble Lord, Lord Kennet.
The Caribbean is a part of the world which is also changing following the end of the cold war. The point that I wish to make today is that I believe that British policy towards the Caribbean must also change. Those changes began with the creation of the North America Free Trade Area. We have to look to the ending of Lomé IV in the year 2001 and its possible replacement by some form of regional association arrangement that will be compatible with GATT. There have also been great changes in Cuba. That suggests that it will be commercial rather than political interests which should determine Britain's policy towards the Caribbean and that we in Britain, who still tend to think only of the English-speaking countries of the Caribbean when thinking of the Caribbean at all, must recognise the significance of the Spanish-speaking countries of the Caribbean and Central America.
First, I should like to say a word about our traditional links before looking at the wider Caribbean. Traditionally, Britain's links with the Caribbean have been with the English-speaking countries, with which we have had, and still have, strong ties through the Commonwealth, trade, culture and family, particularly through the thousands of Caribbeans who come to live and work in this country. Above all, we speak the same language.
I believe that now our relationship should be conditioned not only by what has been the case in the past. The larger English-speaking countries of the Caribbean may well, over time, develop new linkages with the non-English-speaking Caribbean countries through the Association of Caribbean States. We must recognise that that new approach shows the way in which Britain's aid, security, commercial and other ties can be enhanced by a British-led European Union policy.
Already we have been deeply involved in the long and protracted negotiations on bananas, a fruit known nowadays more for its skin than anything else. It is a crop on which Jamaica, St. Lucia and Dominica are largely dependent. There is not time to go into the complexities of the negotiations, except to say that they are not yet resolved. Yet, without a permanent solution, the danger is that the economies of those small countries could collapse and that the drug dealers will move in to the vacuum which is left behind. There are similar problems in relation to rum.
Although those issues affect the English-speaking countries in particular, they require today European and American involvement for their solution. In that sense there is a great change. I echo the importance of Britain having a strong voice in the European Union and in the arguments in the debates which we seldom speak of but which are of extreme importance to some countries.

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Our other major interest in the Caribbean concerns the five dependent territories. I know that both Ministers and the Foreign and Commonwealth Office have given much thought to the future of those territories, for which we are ultimately responsible. It must be right to have an absolute commitment to good government, law and order, the regulation of such matters as offshore financial activity and the eventual economic self-sufficiency of those small countries. However, I should like to think that our policy should move forward politically. The recent troubles in the BVI should act as an incentive to us to take their concerns more seriously. For example, the decision to create additional tiers of bureaucracy for the Dependent Territories' Secretariat in Barbados to "manage" those small countries has not encouraged a better relationship, however well intentioned.
What I believe is needed is an approach which recognises the growing concerns of chief ministers regarding their relationship with governors, the powers of the elected governments and governors, and the role of London and the secretariat in Barbados. I should like to think that it would be possible to hold a conference in London which would establish, on a negotiated basis, the principles regulating the relationships between London and the Caribbean dependent territories.
I now turn to the other countries of the Caribbean and the directions in which the Caribbean is changing. I have already referred to the Association of Caribbean States. That new association includes Mexico, Venezuela, Colombia, and the Central American republics, as well as Cuba and the traditional islands of the Caribbean. It was formed last summer. Its objects are to promote economic, social and cultural co-operation. The association covers a population of some 200 million and has a collective GDP of 500 billion US dollars. As such it is potentially the world's fourth largest trading bloc. It seeks to define a special free trade relationship both with the NAFTA and with the European Union, where of course there is more than one player.
Against that backdrop we can look, too, at Cuba and see great changes. There is now a far-reaching structural reform programme. I was delighted that my honourable friend Ian Taylor visited Cuba in September and signed an IPPA agreement with that country. My honourable friend has indicated his wish to develop programmes of economic co-operation between London and Havana. It must surely be in our interests to encourage Cuba to move both towards a democratic system of government and a free enterprise society, as we are encouraging the eastern European countries. What is now needed is for Britain to respond quickly to Cuban requests for technical and other forms of assistance.
What can we do to help? I hope that my noble friend may be able to say when replying whether it would be possible to give them something from a know-how fund. I believe that they need advice on how to manage a market economy and training in entrepreneurial skills and the management and regulation of utilities. We in the United Kingdom have considerable experience of all those programmes, particularly of privatisation, and we have much to offer from our experience in eastern Europe. Is there also any prospect of the restoration of
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ECGD cover? Can, for instance, the Commonwealth Development Corporation look at the wide range of opportunities for investment?
Puerto Rico is a small country, yet it is the third largest market for British exports after Brazil and Mexico. Its population is only 2.5 million, yet we had direct exports to the island of £188 million in 1993, and so far in 1994 our exports have increased by 66 per cent. We are already the largest investor in Puerto Rico after the United States. There are a great number of opportunities for the United Kingdom in a number of infrastructure projects planned for the island, and it would be nice to think that we could take advantage of them. The establishment of a small consular office in Puerto Rico has undoubtedly been of great help in all that activity.
That brings me to the Dominican Republic. Here, too, is a market of growing importance. I am glad to hear that my honourable friend Mr. Tony Baldry will visit the Dominican Republic in December. In this country we have been enormously well served by our honorary consuls, but we now need some form of permanent representation, which would be of immense benefit to our exporters and to our relationship with that country.
I began by saying that I believe that Britain's policy towards the Caribbean should change to take account of the great changes in that part of the world. I recognise the many demands on the diplomatic service, and I was interested to hear what the noble Lord, Lord Wright of Richmond, said on this subject in his remarks. It would be unfortunate if, as resources diminished in that part of the world to take account of the many other calls on the diplomatic service, departments of state responded by simply reducing all the programmes without trying to find alternative ways in which they might be better co-ordinated both in the interests of the region and of Britain and the money which is available better used.
We need to catch the mood of the region, which is now one in which the primary consideration is the commercial interests of those countries. Such consideration will add to their prosperity; and that must be a matter to be welcomed. We should look again at our aid policy, which could well extend over a wider region—for example, I have suggested that it could extend into Cuba. It could be a policy of working more closely both with the private sector in its activities and with non-governmental organisations. I hope therefore that we can look again at our diplomatic and commercial representation in that part of the world. We need to face the fact that that area is changing rapidly. We need to take account of the new political and economic realities.
There are great opportunities for our exporters in the Caribbean and for an increasing and important partnership. That partnership will benefit ourselves, it is true, but also those countries which, although not the poorest in the world, may welcome and need our help and support. Such a partnership would build on a long

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tradition. It is an opportunity that we ought not to miss in the changes that are coming about, and it is an issue that we need to look to as we approach the 21st century.
6.41 p.m.
Baroness Elles: My Lords, I, too, should like to add my congratulations to my noble friends Lord Blaker and Lady Rawlings on their maiden speeches. They have brought an area of expertise to our debate today which might otherwise have been lacking. We are most grateful for their contributions today and hope to hear from them often in the future.
The outstanding evidence from the gracious Speech is that the United Kingdom is in a unique position in relation to international affairs. The noble Lord, Lord Wright of Richmond, touched on the fact that we are one of the five permanent members of the UN Security Council. We are members of the European Union, NATO, the Western European Union and, importantly, the CSCE. There is reference in the gracious Speech to the visit of the Queen and the Duke of Edinburgh to New Zealand for the Heads of Government Commonwealth meeting. We are members of the Commonwealth. We should welcome most warmly the visit of Her Majesty the Queen to South Africa which has once again re-entered the Commonwealth, a matter that those of us on all sides of the House warmly welcome. We send our warmest wishes to the two leaders, in particular President Mandela, and Mr. de Klerk for his courageous actions in bringing about the current situation in South Africa.
No other country has such responsibility as the United Kingdom in playing a pivotal role in the policy making and development of international relations and in working for the maintenance of peace and political stability. But we must remember that it must be the prime duty of any elected government to look after the interests of their own citizens. They must ensure that the interests of their citizens are protected.
I wish to touch on two or three of the wide range of issues set out in the gracious Speech. I do so not because they are more important but many matters have already been touched upon and I wish to raise these specific issues before your Lordships tonight. First, it has been correctly emphasised that the European Community finance Bill rests on the legal obligation already undertaken in December 1992 at the Edinburgh Summit. There can be no question of reneging on that obligation. It would be devastating to the record of the United Kingdom if that were even to be threatened.
The increases involved are proportionately slight compared with the expenditure programme of the European Union and the tasks before it. That factor is largely due to the successful efforts of my noble friend Lady Thatcher at the Fontainebleau Summit some years ago when she succeeded in fixing the abatement for the contribution of the United Kingdom. That policy has been continued by my right honourable friend the Prime Minister. But there has been a certain amount of political scenery (if one may call it that) because of the timing of the publication from the Court of Auditors; and there is a debate in the European Parliament. The
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report from the Court of Auditors, regrettably, has been repetitious every year in setting out examples of massive fraud. No one can deny that there is fraud in the European Community and it must be stamped out. I do not intend to go into that in detail now. We have already had a major debate on the excellent report from the sub-committee chaired by the noble Lord, Lord Hunt of Tanworth, on financial control and fraud in the Community. Many recommendations were made and debated in your Lordships' House.
However, as I read the press, I sometimes wonder whether we are not being rather holier than thou. Let us look, for example, at the magnificent record of the Inland Revenue. It has recouped £4.7 billion sterling from underpayments and cheating in income tax returns in this country alone. Already the Department of Social Security—I congratulate the department on its work—has recouped £654 million from fraudulent demands for benefits. There is no doubt from conversations with those responsible that the sums estimated to be fraudulently paid out in this country run to something like 10 per cent. of the total budget on social security and health. That includes fraud, crime and waste. As the total sum for that budgetary element is £83 billion, one can safely estimate that something like £8 billion is being paid out fraudulently or through waste. I do not wish to minimise the estimated £6 billion which is missing from the Community budget, but let us start at home. Those members who claim that they are serving the British taxpayer and their constituents well by tackling so forcefully the European Community could well start by serving their country and taxpayers better by ensuring that those frauds and wastes are properly controlled through parliamentary activity—the Public Accounts Committee, the National Audit Committee and the various other means by which representatives of the people of Britain can look after the interests of their people.
Although fraud exists in the European Community, it exists everywhere. Probably one of the best actions that Britain can take is to indicate what we are doing in this regard—identifying fraud in our own country both from EC funds and within the UK's administration—and in that way encourage other member states to do the same: to ensure that they are controlling and monitoring payments into the various funds of the Community, whether the agricultural, structural or regional funds or payments as regards training. We have many examples of frauds. It is up to the member states to ensure that that fraudulent behaviour and the imposition on all European taxpayers is stopped as speedily as possible.
On a point of international law, the acceptance of the United Kingdom to fulfil its legal obligation is important when we reflect on the recent decision of President Clinton to flout a Security Council resolution, to which the US was party, to waive the naval embargo on trade of arms to Bosnia. As Alain Juppé pointed out recently, it was the unanimous decision of NATO that that embargo should remain. It bodes ill for our relationship if deflection from a legal obligation, taken through major bodies of which the United Kingdom is a member, should start in that way. We should perhaps also remember that, to my knowledge, the US has no

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ground troops in Bosnia, but we, the British and the French, have the largest contribution there in the form of ground staff and UNPROFOR. They will be the recipients of an undoubted escalation of armed conflict in the area. That decision was ill thought out and could have disastrous consequences for the United Kingdom, both for our troops and the French troops serving on behalf of the United Nations. They are not there as members of national military personnel; they are there on behalf of the United Nations. That is an even more harmful aspect of the decision, which is regrettable.
The signal that has come from the president and consequently the US serves as a warning to us to get our own act together in Europe. First, we should strengthen our co-operation through the Western European Union. I believe that the treaty expires in 1998, so we now have an opportunity to study its provisions to see how we should go forward and develop closer relations in the military field.
Secondly, we should make greater use of common interests and concerns through the common foreign and security policy, the CFSP structure available to European Union members. We have seen the success of Her Majesty's Government's foreign policy in pressing for the enlargement of the European Community. The Government should be congratulated that it is one of the planks of their policy within Europe that we should go forward as quickly as possible to unite with other applicants to the Union. I am sure we all welcome them as warmly as both my noble friend Lady Chalker and the noble Baroness, Lady Blackstone, did when they congratulated Austria, Sweden and Finland on joining on 1st January. We very much hope that Norway will also do so.
I consider that it should be an urgent matter to assist the four central and eastern European Visegrad countries to enter at the earliest possible time and not to disappoint the aspirations of those who lived under oppressive regimes and who have sought to turn to democracy and liberal economies. That is a very difficult stage in the transition of any country, as we know only too well and have seen throughout Europe. Those countries seek membership of the European Union to consolidate and stabilise their internal situations.
No foreign policy can be achieved without close alliances not only between the European Union and bordering countries but also within the European Union. Efforts to co-operate closely, for example, with Italy have been made on specific issues and it must surely be in the United Kingdom's interest to co-operate more closely with France. Despite our traditional differences, we share with it the same strategic interests.
As France will take over the presidency in January, we have the opportunity of working more closely together. We now have both the symbolic and the practical example of a close link between our countries through the Channel Tunnel which was referred to by the noble Lord, Lord Wright. With it, we have a practical example of how the citizens of France and other countries on the Continent can come through to our islands as we, the citizens of the United Kingdom, can go through to the Continent, recognising that we do
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not have to cross what has always been considered the division between us and the rest of the world—the Channel. Thus I hope very much that the Channel Tunnel will be a symbol of the joint efforts in a great masterpiece of engineering which will unite us with the Continent and remove what my noble friend Lord Cockfield so aptly called the "hang up" of the isolationists and turn us into true Europeans.
6.54 p.m.
Viscount Waverley: My Lords, there is international concern regarding Kashmir and noble Lords will be aware of the historical background. Last month marked the 47th anniversary since partition and the onset of a bloody and bitter dispute over the altered status of the state.
I recently visited the region as a member of a parliamentary group and have since spoken to diplomats, parliamentarians, academics and representatives. My contribution today seeks to summarise the complexities and difficulties that make a solution elusive, rather than to judge the merits of any one position over another.
The United Kingdom maintains excellent relations with both India and Pakistan and both are members of the Commonwealth. India and Pakistan have fought two wars over Kashmir, which have left the state physically divided and heavily militarised. To illustrate the magnitude, there are approximately 600,000 opposing troops, including militants, in an area the size of England. By comparison, the British Army totals 120,000 regular troops.
An important development in 1972 was the Simla Agreement signed by both India and Pakistan, under which they,
"resolved to settle their differences through bilateral negotiations or by any peaceful means mutually agreed between them".
The agreement looked forward to,
"a final settlement of Jammu and Kashmir".
It was a confidence-building mechanism, which failed to produce a solution.
A fundamental difficulty derives from the present relevance of UN Security Council resolutions tabled at the time of partition, which offer to Kashmiris the exercise of their right of self-determination by means of a plebiscite. There are three key questions: first, what is each party's position? Secondly, what has prevented early resolution? Thirdly, what mechanisms would break the deadlock and lead to a possible solution? The following brief synopsis might appear bland; but a balanced assessment of such an emotive topic would benefit little from prejudice and rhetoric.
India's perspective focuses on the bilateral nature of a dispute between India and Pakistan; she does not countenance foreign intervention, including that of the United Nations. The need for dialogue under Simla is recognised to resolve, for example, issues of control of the areas west of the ceasefire line. Her position is premised on legal, historical, political, strategic and secular arguments. Kashmir is de facto and de jure an integral part of India. She believes that to concede would signal the eventual break up of the union. India

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criticises Pakistan for assisting and encouraging terrorism and militancy, as well as for internationalising the issue. Their response to criticism of the military's record on human rights is to point to the improved openness and transparency.
A priority is to prepare for state elections before July 1995 and so comply with the constitution. India calls on friendly democracies like Britain for encouragement in her efforts to hold elections under difficult conditions. Candidates cannot canvass on a separatist platform; indeed, any candidate so doing will be disqualified.
To Pakistan, Kashmir is unfinished business: an international dispute to be settled according to the relevant UN resolutions, through a UN-supervised plebiscite to decide accession either to India or Pakistan, with an independent Kashmir as an unacceptable option. Pakistan admits that the Simla Agreement conforms with the UN charter and the spirit of the resolutions. She sees the UN's presence in Kashmir as a physical testimony to the basic legality of that position. She seeks international action on human rights violations.
To the Kashmiris, this is not simply a dispute between the two sovereign nations, but a conflict among three parties. They insist on their right of self-determination as described in a number of Security Council resolutions. The Simla Agreement is not recognised as they were not party to that accord. To many, independence must be seen as a viable option to be weighed alongside accession to either India or Pakistan.
Their views are represented by the all-party Hurriyet Conference, a joint forum of 34 political parties and other organisations. No consensus of objectives has yet emerged; those who favour independence have not been swayed by those who want to join Pakistan. In their view, the proposed election process in the state of Jammu and Kashmir will not be representative. The Hurriyet Conference therefore is determined not only to boycott, but indeed prevent the entire process.
The positions of the United Kingdom, the United States and the European Union are broadly similar. It is widely held that the most practical method of resolving the dispute is through peaceful bilateral negotiations in the spirit of the Simla accord. The holding of a plebiscite to determine the future is not precluded providing all sides agree to that modality and are willing to employ pragmatism and realism rather than history and hindsight. All human rights abuses and any outside assistance, be it from governments or private organisations, to militant groups which commit acts of terrorism are strongly condemned. All combatants in the conflict are urged to cease hostilities and begin immediate negotiations in good faith aimed at resolving this dispute.
The United States perspective differs in the detail. It considers the entire pre-1947 princely state of Jammu and Kashmir to be disputed territory, and reiterates that the views of the Kashmiri people should be taken into account when deciding its future status. Further, it believes that the political processes in Kashmir must be transparent, thereby ensuring that local, state and national levels of government are accountable to the people.
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What role is there for the world community? Certainly, the UN resolutions are still on the table, and as such should take a proactive role. The broader situation in the sub-continent must give rise to grave concern. Extremes of poverty, over-population and resource-depletion, appearing cheek by jowl with allegations of human rights abuses, terrorism and nuclear capability, expose dangerous fault lines for explosive potential regional conflicts. The futility of armed intervention must be exposed, with the usefulness of constructive dialogue emphasised and concretely supported. A mechanism must somehow be devised to facilitate that.
It may be that the UN resolutions relating to Kashmir and the Simla accord send conflicting messages. The world community recognises both instruments and, naively perhaps, expects a solution to be forthcoming. It may be helpful to recall the text from an important Security Council resolution, Resolution 122, on 24th January 1957, wherein the governments of India and Pakistan were both reminded of the,
"principle embodied in its resolutions … that the final disposition of the State of Jammu and Kashmir will be made in accordance with the will of the people expressed through the democratic method of a free and impartial plebiscite conducted under the auspices of the United Nations".
The United Kingdom voted in favour; no country voted against. That position was reaffirmed in December 1957 in Resolution 126. Again, the UK voted in favour and no country voted against.
It may be pertinent for noble Lords to ascertain HMG's view, as a member of the Security Council, of the status of the existing UN resolutions and their compatibility with the spirit of Simla and bilateralism and with any right of the Kashmiri people to self-determination.
In urging dialogue, I submit the following steps as possible confidence-building measures that might be broadly acceptable. First, Pakistan's position could be amended to allow for alternatives to the current bifold version of plebiscite; secondly, India's position could be amended to eliminate any claim to sovereignty over that part of Kashmir currently in Pakistan's control; thirdly, intra-Kashmiri dialogue could be encouraged, possibly in London, with representatives from both sides of the line of control; fourthly, Pakistan and India could negotiate a swift and complete withdrawal of armed forces from the Siachen Glacier; fifthly, during the period of dialogue and negotiations, a truce, strictly observed by the international community could be effected between the various Kashmiri militants and the Indian army; sixthly, cross-border support could be immediately halted, monitored by neutral observers; seventhly, the International Red Cross could be allowed entry into all areas of Kashmir; and eighthly, unofficial observers could be allowed to attend Jammu and Kashmir elections.

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We should do well to be reminded of the statement by the French president of the Security Council on 18th May 1964 while summarising the conclusions of the debate on Kashmir.
"The members of the Council expressed their concern with respect to two great countries which have everything to gain from re-establishing good relations with each other and whose disputes, particularly that centering upon Jammu and Kashmir, should be settled amicably in the interest of world peace".
A solution is possible, with strong leadership, patience and a modicum of good will, combined with quiet diplomacy. The dividend is lasting peace and well-deserved prosperity for two vital bedrock members of the Commonwealth, the Non-aligned Movement and the United Nations.
7.7 p.m.
Lord Selsdon: My Lords, it is 50 years on, and I suppose it is fair to say that the demolition of the British Empire is nigh on complete. In those 50 years the demolition of the British economy, the wiping out of the ruling classes, the middle classes and all classes is nigh on complete due to taxation and inflation. In that period of 50 years, there has been one thing for which we shall be eternally thankful—peace. In my view, that peace has been largely due to the development of the EC—the common market—and the beginnings of the reunification of Europe. That unification is well under way; and I dismiss it entirely as being of no interest, old hat and a matter entirely for the bureaucrats to advance.
What of ourselves? We are no longer hated. We are no longer feared. Those lovely little anecdotes, such as that the sun never set on the British Empire because the natives did not trust the British after dark, are long gone. But we have to think of 50 years hence. I take as my text the words of my noble friend Lady Chalker, who referred to,
"an active foreign policy tailored to Britain's needs".
The words "active" and "Britain" are good. Her tailoring today is also excellent. The colours are very similar to those of my own tribe and I therefore know that we shall share the same views.
But what is "an active foreign policy tailored to Britain's needs"? It is surely not consensus politics. It is surely not mandarinism. I recall reading, and I cannot remember where, that parliamentary mandarins are ineffably shocked by the impiety of an independent radical. I shall try to be slightly radical but slightly British—being British is not being radical. I have dismissed the common market because it is a market. It is next door and adventures are not necessarily into neighbouring countries. But it is also at once the haven of our culture and the haven of our commercial and industrial competitiveness.
Like the noble Lord, Lord Kennet, I turn towards the United States. If the demolition of the British Empire is nigh on complete, the peak of the United States is certainly past. What of America? Does it have a foreign policy? Does it need a foreign policy? Is it of any significance to us at all? I shall use the words of a fairly well-known American politician with whom I had the privilege of lunching many years ago, though I shall refrain from naming him. He asked me why, in order to
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be pro-European, was it necessary to be anti-American. I replied by asking why, in order to be pro-British, was it necessary to be pro-American. What is American foreign policy? He explained it to me thus: "In the United States we do not have any elephants. American foreign policy is like a great she-elephant on heat, going through the jungle. You can hear it, see it and sometimes even smell it, but you do not know what it will do next; nor does it." I do not believe that we should rely upon American foreign policy.
The noble Lord, Lord Wright of Richmond, and I share a love of the phrase "above our weight". He used the word "punch"; I prefer the word "box" because "box" implies more cunning. Again, perhaps I may offer the House an anecdote which I hear from time to time in the Middle East. To the question: "What is wrong with the Middle East?" comes the answer, "Four things really: hashish, baksheesh, malish and Briteesh, and Briteesh is the worst because they invented all the other three".
We were once cunning. We were devious. Our mandarins wore long sleeves from which the money came to corrupt and bribe. I think we need the term "mandarinism" again, but of a new sort. If we are unable to box above our weight, we must take on more weight quickly. In planning that, we need—as in all things—a tripod: three legs so that we cannot be knocked over. First, we must pretend to everybody that we have continental Europe in our hands and that we have more influence over it than does any other single nation. That could well be true. Secondly, we must pretend to others that we have more influence over the United States than does any other single nation. I believe that that is true; the countries to which I go surely believe it. Thirdly, we must not forget the British element: the Commonwealth, which has 40 seats in the United Nations. Through Her Majesty the Queen, effectively we are head of the Commonwealth.
Those three branches, or legs, provide us with the most powerful platform upon which to go forth and add weight. Commercially, we are probably in better shape than we have been for a while. But we could look at the past 50 years and ask ourselves what has happened and how we measure our economic decline—for such it has been. Fifty years ago the £1 stood at 17 Swiss francs; today it is worth 2 francs. That is a decline of 90 per cent. Then the pound was worth 4.2 US dollars; now it is worth 1.57 dollars. That is a decline of about 60 per cent. In the meantime, the currencies of Japan and Germany have strengthened. It seems that you must always lose a war and never win it.
We have world peace, apart from little incidents. We must look for new markets and new opportunities. Continental Europe is on our doorstep. I do not know what we shall call it—if we drop the "U" from EU it will simply become Europe again. We know about the United States and about Latin America, which is a growth area. We left behind the Caribbean; perhaps we can steal the Cuban market before the Americans get in there. But let us go forth into another area that I rather like. There is a patch where Europe ends and something else begins; it continues before you get to India and South East Asia. That is the country of the new "great

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game". That is a vast area to which those who understand British history of a hundred years ago and remember Kipling must go forth. In that area, which runs from the Bosporus and includes Moldova, going north and south, bringing in the Arab world and including Pakistan, are some 734 million people and 33 countries which have 75 per cent. of the oil reserves of the world, 66 per cent. of its gas reserves and a good chunk of its minerals. Let us add the relationship in South Africa as well and inevitably we must return to the belief that for a nation to be rich and great it is necessary to have large, secure supplies of oil, wood, minerals and food.
The development of those economies and working together with them will give us some great opportunities. They have a need for the things that we have which they do not make or produce themselves. They have things which we need, we ourselves not being able to have a totally independent economy. Those areas are fascinating and interesting. I have to declare an interest because I have been there looking at opportunities. In Baghdad, I have been pretty forthright with the Iraqis about what they should do next. I have talked with the Libyans. I have been in Iran dealing with other people and trying to persuade them to think differently. Little things come out now. No longer are people accused of being involved in the financing of terrorism in Northern Ireland. I did not realise that the Irish situation could apply or be of interest to people worldwide.
I believe that universally we are not hated or feared. We were very nearly on the point of being pitied but now we are respected as honourable men. Looking at the territories that are open to us and the need to develop our resources—as I think was said in Omar Khayyam:
"'Tis all a chequer-board of nights and days
Where Destiny with Men for pieces plays".
There is a big world to play in. We must have an active British foreign policy. I should like to know what it is.
7.17 p.m.
Lord Avebury: My Lords, the noble Lord said that he had just been in Teheran and does not believe that the Iranians are any longer involved in active support for the IRA. But very recently the Foreign Secretary had to make a public statement calling attention to the activities of the Iranian régime in regard to the IRA. Recently there were bomb attacks instigated by the Iranians on Jewish buildings in London. There have been bomb attacks on Jewish buildings in Buenos Aires, also instigated by the Iranians. The Iranians have done their best to disrupt the Middle East peace process. I hope that in his discussions with the Iranians —if he returns there—he will make it clear that the policies that the current Islamic régime follows are utterly abhorrent to the British people and will have to be changed if the relationships between our two countries are to be improved.
As chairman of the Parliamentary Human Rights Group, I should like to begin by thanking Ministers at the Foreign Office, including the noble Baroness, Lady Chalker, for the unfailing courtesy and attention that
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they always gave to the matters that we raised with them during the last year and indeed before that. They have always been receptive to the requests that we made to come to see them.
For example, my colleagues, Anthony Coombes and Emma Nicholson asked this morning to discuss Nigeria, following a meeting that I had with the head of region, Mr. Robin Goodenough, to discuss the same problem. We are very grateful to them for the attention that they give to these matters. I must also thank particularly Mr. Tony Baldry, who recently invited a number of Members, not solely from the Parliamentary Human Rights Group, to have a discussion with him before he set off on a visit to Bangladesh and Sri Lanka. We were able to talk to him about some of our concerns, and that is a precedent that might be followed. Indeed, we have invited Mr. Douglas Hogg to come and speak to the group about his regions and interests, which cover the Middle East, the Near East and North Africa. Among other problems we shall be discussing with him Iran, as well as other places which the noble Lord, Lord Selsdon, has visited, including Baghdad and Tripoli. We are also grateful to the Foreign Office for the unfailing courtesy and helpfulness of its officials, including the head of the human rights office, and the many desk officers we ring up to ask for information.
This week, we had a visit from the Bosnian Prime Minister, which was one of the outcomes of a fruitful relationship we have been developing with the Congressional Human Rights Foundation in Washington. As a result of this initiative and many others, there is a better communication of human rights concerns from Members of Parliament to colleagues elsewhere and very valuable co-operation between members of democratic legislatures throughout the world. This should enable us to exert even more pressure than we do already on our governments to put human rights higher up on their agendas. The Global Democracy Network is the developing tool which enables us to link with colleagues in other legislatures through the Internet, and from the information super-highway, as the press like to call it, we can download important human rights documents from the United Nations, such as the resolutions of the General Assembly and the Security Council, which will enable us to do our work far better.
Reverting to the visit of the Prime Minister of Bosnia, I am sure that the Minister is aware of the views that he was expressing about the partition of his country and the injustice of denying a sovereign state the means of self-defence to which it is entitled under the United Nations Charter. The Minister also knows of the concern which has been expressed about the major offensives launched by the MPLA government in Angola, at the very moment when the peace accords were supposed to be signed. I know that the Americans have tried to persuade Luanda to halt those operations, but their requests fell on deaf ears. It would be interesting to know from the Minister, when he comes to reply, whether we also—the European Union—made any appeal to the Government in Luanda to halt their military operations so that peace can be given a chance with the signing in Lusaka.

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In Rwanda, the perpetrators of the genocide that killed a million people are now re-grouping. They are hijacking the food and medical supplies intended for the weak and poor in the refugee camps so as to build themselves up for another attempt. I agreed completely with the Minister about the need for a more coherent and effective conflict resolution mechanism than we have. In the case of Rwanda, what is obviously needed is a determined effort to disarm the Interahamwe, who are re-grouping in, the refugee camps. That could save us a lot of trouble later on.
In Armenia, people are freezing as the winter sets in, and there is extreme suffering as a result of the winter blockade. Even though there has been a ceasefire, we cannot afford to continue to ignore the conflict in the hope that it will go away. In East Timor, the people have been demonstrating their opposition to the forcible occupation of their country, 19 years after it was invaded by Indonesia. In Sudan, 1.2 million people have been killed since the war in the south erupted in 1983. Millions more have been internally displaced, according to the rapporteur, Dr. Caspar Biro, and hundreds of thousands have fled to neighbouring countries. The noble Viscount, Lord Waverley, has just spoken about the problem of Kashmir, a conflict which has been continuing for 47 years and which has caused immense loss of life.
All these examples demonstrate that the attempts by the international community to settle the conflicts which are the cause of so many of the violations of human rights and to redress the wrongs that are done to the victims are pitifully inadequate. I agree with the noble Lord, Lord Cledwyn, who said that we are facing a collective lack of political will. I would add to that the rather hypocritical pretence that, because we draft a plethora of international instruments which purport to confer rights on individuals and groups, and because we devote large sums of money to international meetings at which the violations of those rights are discussed, though never with the imposition of any penalties on the perpetrators, we have somehow implemented those resolutions in spirit as well as in letter. A good example of that is the CSCE's Human Dimension meeting which is being held in, Budapest at the moment. Representatives of all the CSCE states are gathering for a whole two months, culminating in a summit in early December, but it is quite impossible to find out what is being said there, or to have any real influence on the proceedings. I should like to ask the noble Lord who is to reply this question: what hope is there that there will be any concrete results from the CSCE meeting which has taken up so much time and resources?
In Bosnia, ethnic cleansing has been going on. As the noble Baroness reminded us, the citizens of Sarajevo and other towns are being subjected to bombardment and sniping—the district of Bihac is under threat—while the international community has devised a scheme for splitting up the country into ethnic cantons, like the former Bantustans in South Africa. I do not believe that we are going to find a solution. The Foreign Secretary has said—this is part of the most recent Security Council resolution of September 1994—that at the end of the conflict people will have to be enabled to return
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to their homes. I cannot see how that can be possible if some kind of apartheid is enforced on Bosnia. We should have enabled the Bosnians to defend themselves against aggression and to maintain a multi-ethnic, multi-national structure that was at one time a model for the rest of Europe. Instead, we are admitting, by our solution, that people of different languages, religions and cultures are not able to live side by side. That may have serious implications for the rest of Europe. Mr. Malcolm Rifkind was very scathing last night on ITV about the Congressmen who had not been in Bosnia themselves. But I think that Dr. Silajdzic has spent rather more time in Bosnia than Mr. Rifkind. It is no good for the Government to vote for Security Council resolutions which deplore ethnic cleansing and at the same time refuse the Bosnian Government the means of stopping this loathsome practice.
Bosnia is not the only place where ethnic cleansing is going on unpunished within the CSCE region. In Turkey also there is ethnic cleansing in full swing, but there Western countries are eager to support the criminals rather than to prosecute them. The CSCE has done nothing as 1,500 villages have been wiped off the map and 2 million people have been forcibly evicted from their homes by the Turkish armed forces. The state-sponsored death squads have killed hundreds of people, including writers, journalists, politicians, newsboys, human rights activists, lawyers and businessmen. Thousands of people have been arrested and tortured. Turkey has the largest entry of any country in the six-monthly case list of the Writers in Prison Committee and in the US State Department's Country Reports on Human Rights for 1993. The state, after murdering one of the members of parliament of the Democracy Party, has put eight others on trial on charges of undermining the indivisible integrity of the Turkish state, a crime which carries the death penalty. One of the allegations—a typical allegation—against the deputies is that, when asked what foreign languages they spoke for the purposes of their parliamentary biographies, they replied "Turkish". That is supposed to be a criminal offence, justifying the death penalty.
The gracious Speech refers to enhancement of the CSCE's conflict resolution and prevention mechanisms. The question is how the CSCE is able to have any influence on a situation where the state concerned refuses to admit it. There is in the Moscow mechanism a procedure which allows a mission of experts to be sent compulsorily to a state which refuses to invite it voluntarily. But in the case of Turkey, as a Minister remarked to me on one occasion, it would never get past Ankara airport. What does one do when one has an intransigent state such as Turkey which refuses to listen to the advice given by the CSCE or to make the slightest effort to remedy the human rights abuses, which are probably the worst in the whole region?
At the same time the Turkish armed forces have no difficulty in acquiring huge quantities of weapons for their offensives against the Kurdish people. They buy tanks, armoured cars, helicopters, heavy artillery, rockets and mortar bombs and they are spending 6 billion dollars a year on the dirty war and beggaring their own economy. Britain, of course, is not a large

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supplier of weapons to Turkey, but that is probably not for want of trying. We make up for it elsewhere. For instance, in Nigeria a large tank deal happened to coincide with a substantial increase in aid to the Babangida regime.
I have to accept the statements made by the noble Baroness in her speech at the beginning of the debate that there has not been any tie-up between the sale of weapons to any country and the use of the aid budget to lubricate those sales. But it is a remarkable coincidence that Malaysia was not the only case in point of large aid budgets being accompanied by the sales of weapons. I believe that there is something to explain there. Incidentally, the tanks which we sold to the Nigerians are alleged to be still in their crates at the docks because the army does not have transporters to carry them to the armoured division's base.
As has already been mentioned, we sold several hundred million dollars' worth of weaponry to Indonesia, which is in violation of two resolutions of the Security Council and eight of the General Assembly, all of which called on Indonesia to withdraw its armed forces from occupied East Timor. As has been mentioned already, according to the Observer, we are planning to sell them another 2 billion dollars' worth of arms. That is another of the sleazy deals which is alleged to be lubricated with scarce aid money and which, according to the Observer, is going partly towards a project in which General Suharto's daughter has an interest.
The Observer says that the Indonesian shopping list includes armoured personnel carriers, medium-range ballistic and air defence missiles and naval patrol vessels, together with the construction of a big new naval base at Bandar Lumpung, Sumatra. They are said to be close to signing a contract for up to 140 British-made Scorpion tanks which are suitable for use in rugged terrain.
The point I wish to make about these weapons sales is that they all seem to me to be in contravention of the sets of principles governing conventional arms transfers to which the United Kingdom is a party, and in particular the CSCE principles of 23rd November 1993 which say that states will avoid transfers which would be likely to be used for the violation or suppression of human rights and fundamental freedoms. The European Council declaration on non-proliferation and arms exports of 29th June 1991 notes that among the criteria on which arms exports are based is,
"the respect for human rights in the country of final destination".
The five members of the Security Council agreed on 18th October 1991 to avoid transfers which would be likely to,
"be used other than for the legitimate defence and security needs of the recipient state".
It seems to me that the defect in all these instruments is that it is left to the states concerned to decide whether they are complying with the principles. No one state is ever going to accuse another of violations in case the charge should be reciprocated. If the arms control transfer principles are to be applied effectively, what is
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needed is that NGOs should be able to challenge particular transfers before some independent body which should have the power to veto a sale.
There is one final point about the resources allocated to human rights by the international community. The Human Rights Centre in Geneva is still pitifully under-resourced and should be given the money that is being spent on these huge jamborees which are mounted by the United Nations such as the human rights meeting in Geneva last year. I am not aware of a single positive result from that gathering. One may expect even less from the meeting on women which is to be held in Beijing next September. If all the money spent on those festivals was given to the hard-pressed rapporteurs of the working groups then there would be something to show for it. It is really absurd, for example, that the UN rapporteur on torture, who is supposed to report on cases of torture throughout the world, has one-half of a staff person to help him and that at one time last year he and his colleagues were unable to stir from Geneva because the budget for air fares had been exhausted.
I welcome the commitments in the gracious Speech to promote respect for human rights, but I hope that as one essential component of that policy the Government will ensure that the Centre for Human Rights gets a realistic budget.
Lord Selsdon: My Lords, before the noble Lord sits down, I hope that he will allow me to correct something. The point I was making was a fairly robust one. First, it is pointless and foolish for anyone to try to support terrorism in Ireland. Secondly, unless you tell these people as robustly and forcefully as you can—and I have had the privilege of doing that personally—you do not get anywhere if Ministers are unable to visit them. I have had the privilege of taking the noble Lord's speeches with me and making the points personally. I hope that he will have that privilege himself soon.
Lord Avebury: My Lords, I am very glad to hear that. I am grateful to the noble Lord for raising these matters with the Iranian régime.
7.35 p.m.
Baroness Hooper: My Lords, the scope of this debate is very wide. I have listened with considerable interest to the many experts who have spoken on various topics and about various parts of the world. I intend to concentrate my main remarks on Latin America. But the debate so far provokes me to touch on some other issues as well. First, I certainly agree with my noble friend Lady Rawlings—and I take the opportunity to congratulate her on her excellent maiden speech—that enlargement of the European Union will bring considerable benefits not only to the European Union itself but to the region as a whole.
I also believe that in the context of the enlargement of its membership and the widening role of the European Union into areas such as education and culture, we should be also perhaps now considering the role not only of the European Union—I was a member of the European Parliament myself in the past—but also that of the Council of Europe of which I am currently a member of the Parliamentary Assembly. It seems to me

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that the time might have come for the convergence of those two institutions which could, in addition to avoiding any possible duplication, take into account a more defined role for national parliaments in scrutinising European legislation. Perhaps that might be the subject for a further specific short debate at some stage.
Secondly, I also wish to underline the good news in the gracious Speech, as constituted by what has been happening in South Africa. I welcome the fact that Her Majesty the Queen will be visiting South Africa next year. I well remember the words of Archbishop Tutu at the very moving ceremony held in Westminster Abbey in July of this year to welcome South Africa back into the Commonwealth. He said that it took the courage of a De Klerk and the forgivingness of a Mandela to achieve the transition that has taken place in South Africa. Both those qualities continue to be needed in abundance to consolidate what has been achieved there and to continue down the path of progress. I very much hope that the British Government will continue to show support to South Africa in all those respects.
I believe it was the noble Lord, Lord Bridges, who first referred to the fact that our empire has fallen away. That reminded me that in the course of the last Session in your Lordships' House we held a debate on the role of the dependent territories. Naturally, we have focused in this House very much on Hong Kong, the Falkland Islands issue and Gibraltar. But that debate also enabled us to think about the Caribbean dependent territories to which my noble friend Lady Young referred today as indeed did my noble friend Lord Selsdon, and to the very tiniest of those dependencies like Anguilla and the Pitcairn Islands. Perhaps that too could be the subject of a further and separate debate at some stage during the Session.
I should like to take this opportunity to record my satisfaction at the fact that the Dependent Territories are themselves forming a voluntary association so that they can work together and share the costs of raising common problems, as well as showing solidarity where there are separate and individual interests at stake. But most importantly, that association of the dependent territories will ensure that they do not run the risk of being the forgotten remnants of the Empire.
Turning to Latin America, my noble friend Lady Young has already referred to Central America, Cuba and the Caribbean, and I know that my noble friend Lord Montgomery of Alamein had also wished to speak on the subject of Latin America but unfortunately he has not been able to stay because of the length of the debate. Like my noble friends, I spoke on Latin America during last year's debate on the Queen's Speech and referred to the fact that pluralistic democracy is in place in virtually each country. I also referred to the curbing of inflation there, to the impressive growth rate of virtually every economy and to the opportunities for trade and investment for the United Kingdom. In the intervening year, there have been changes of presidency in Mexico, Colombia and Brazil, with congressional elections in other countries. All those changes and the way in which
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they have taken place show that political stability is now a fact of life. The threat of military intervention in any country in Latin America has become remote.
On the economic front, it is worth remembering that Latin America's collective GDP exceeds those of Africa, excluding South Africa, the Indian subcontinent and South-East Asia combined. It is worth remembering that Brazil and Mexico are among the 10 largest economies in the world. It is worth remembering that the region is the world's leading producer of many raw materials, including copper, lithium and rhenium; that it holds one-third of the world's iron, copper and bauxite, and that it has abundant chemical deposits as well as being rich in oil, coal and gas. It is also worth remembering that the Inter-American Development Bank and the World Bank are pumping some 5 billion dollars a year into the Latin American countries, creating thousands of new projects. It is worth remembering when we discuss European regional organisations that the North American Free Trade Area, which includes Mexico as well as the other North American countries, and MERCOSUR, which includes the southern countries of Argentina, Brazil, Paraguay and Uruguay, are developing as strong, regional free trade areas.
It is small wonder therefore that UK companies, both industrial concerns and those involved in the commercial and other service sectors, are taking an interest and are, I am glad to say, making substantial investment in the region. I am delighted, too, that the Department of Trade and Industry and the Foreign Office are making a concerted effort to establish links and to follow up opportunities with ministerial visits and trade visits.
The noble Lord, Lord Wright of Richmond referred (from his particular experience) to the role played by our ambassadors and embassy personnel in assisting businessmen and industrialists in their efforts to expand their links and contacts all over the world. They are certainly doing an excellent job in Latin America, as are members of our Royal Family. Even now, the Duke of York is in Argentina; Prince Michael of Kent has just returned from Peru, and the Duke of Gloucester has recently been involved in presiding over Latin American events here in London. All that must help to build up confidence that the United Kingdom is interested in that part of the world, as well as in helping to establish contacts and links for the future. I warmly welcome that progress.
Finally, I should like to refer specifically to Argentina, not only because it is a large country and, together with Peru, shows the strongest economic growth in Latin America, but also because of its conflict with this country which still remains in people's minds. I believe that if the average British citizen was asked to name a country in Latin America, Argentina would be the country referred to. That is why I should like to take this opportunity to record the fact that earlier this year, with two other Members of your Lordships' House as well as Members of another place and British industrialists, I attended the fourth Argentine-British conference which was held in Mendoza. We had the opportunity to meet our opposite numbers from the

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Argentine Congress and Senate, as well as individuals involved in both commerce and industry. We discussed a wide range of topics of mutual interest, including issues relating to energy, the environment and trade.
One very important feature of that conference was that we were accompanied in our discussions by three people from the Falkland Islands—"the islanders" as they were tactfully and generally referred to. That gave us an opportunity to discuss the issue that continues to be a problem between ourselves and Argentina. We had useful and beneficial discussions on which I hope that we can continue to build so that the islanders will continue to be present in future discussions and so that their voices can be heard and listened to with respect. I look forward to hearing from my noble friend the Minister about any further UK initiatives in Latin America.
7.47 p.m.
Baroness Cox: My Lords, I should like to add my own very warm congratulations to those paid by other noble Lords to my noble friends on their immensely interesting and distinctive maiden speeches.
In responding to the gracious Speech, I welcome the Government's unequivocal statement of commitment to promoting respect for human rights. In doing so, I wish to focus on some of the problems that are posed by violations of human rights in conflicts in so many parts of the world today, conflicts which are causing great suffering to those directly involved and posing immense political challenges to the international community.
First, however, because those conflicts often involve the need for humanitarian aid, I should like to express my gratitude to my noble friend Lady Chalker for the support that has been given by the ODA to some of the humanitarian projects with which I am involved. Here I must briefly declare my interests in my work with MERLIN (Medical Emergency Relief International) and CSI (Christian Solidarity International), a human rights organisation which is working for victims of repression, regardless of their creed, colour or nationality. I and my colleagues in those organisations have been enabled to undertake many of our projects, not only by the financial resources of the ODA, but also by the personal help of the staff of the ODA to whom we should like to record our gratitude.
However, as I have said, my overriding concern is with violations of human rights in the myriad conflicts across the globe in which man's inhumanity to man is causing suffering on a massive scale and, in some places, is threatening international security. In considering those tragedies, I wish to highlight three interrelated issues: first, the problem of access by major aid organisations and by the media to people suffering persecution by repressive regimes; secondly, the clash between the principles of territorial integrity and self-determination, a clash which is the cause of so much bloodshed and which is a hindrance to attempts to achieve peace in many of those conflicts; and, thirdly, the need for more effective conflict prevention and
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conflict resolution, both within the CSCE, to which reference was made in the gracious Speech and by my noble friend the Minister, and also further afield.
In addressing those three issues, I shall draw, if I may, on recent experience with the Karen people of Burma; the Kurds; the Armenians; and the Sudanese of Southern Sudan and the Nuba Mountains.
The first issue is that of access to minority groups suffering at the hands of repressive regimes. If a sovereign government refuse to give permission, major aid organisations such as UNHCR or UNICEF, or human rights organisations such as Amnesty International, often cannot reach those people suffering repression, because they depend upon invitations from the sovereign government. For example, when I first visited the Armenians of Nagorno-Karabakh in 1992 they were blockaded by Azerbaijan and under constant attack, with many civilian casualties.
I saw patients with injuries such as amputations, burns, glass in eyes, and because of the blockade the doctors had no analgesics or anaesthetics to ease their pain—only vodka. At that time there was no British major aid organisation available to help, and I had to turn to CSI to do what we could. I am pleased to say that since then MERLIN has been established, and has undertaken an excellent programme in Nagorno-Karabakh funded by the ODA. The ICRC and Médecins sans Frontières are now doing valuable work there.
However, the major UN organisations are still absent, and the people of Nagorno-Karabakh are therefore denied not just their resources and expertise but their advocacy. UNHCR can speak effectively on behalf of the Azeris suffering in that war, but have no direct contact with the Armenians of Nagorno-Karabakh. There are many similarities between the predicament of the Armenians of Nagorno-Karabakh and the Karen and Mon people of Burma. Last week, I and colleagues from CSI, heard disturbing first-hand accounts of atrocities perpetrated by the Burmese Government—the infamous SLORC regime. We met people who had had to flee from their villages because SLORC troops had been committing murder, torture, rape and pillage, and taking hostages for forced labour. We saw the evidence of maltreatment on the bodies of those whom we met.
We also received disturbing and, we believe, strong circumstantial evidence suggesting the possibility of the use of germ warfare by the SLORC regime against the Karen people, evidence which raises many questions which need to be answered. But the SLORC regime denies access to human rights authorities and to the media which wish to check the authenticity of the accounts of such atrocities. Similarly, the Sudanese people who live in the SPLA-administered areas of the Nuba Mountains have been subjected to sustained military offences by the regime in Khartoum, and are totally bereft of medical supplies or other necessities; and access to them by humanitarian aid organisations and by the media is denied consistently by that government.
How long can such unscrupulous regimes be allowed to carry out murder behind closed borders, or to perpetrate brutal policies without some more effective

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form of international pressure or intervention? Here, I regret that I have to express concern over Britain's role in some of those areas. For example, there is meant to be concerted economic pressure by the international community upon the SLORC regime of Myanmar, but earlier this year the British ambassador in Rangoon took a personal initiative to organise a British week to promote trade in which British firms such as Glaxo and Rolls-Royce participated. In Azerbaijan, the recent signing of contracts between BP and the Azeri Government means that hundreds of millions more pounds are now available, with no constraints, for Azerbaijan to use in its war against the Armenians of Nagorno-Karabakh. Although a precarious ceasefire has been holding for several months, there are indications that Azeri forces have been purchasing more tanks and other weapons and have been preparing for possibly the biggest military offensive to date.
Perhaps I may ask my noble friend the Minister what progress is being made to reconcile the differences between the CSCE and the Russian peace proposals—peace proposals which are needed urgently if war is to be prevented. That is a war that could turn into a regional war with possibly incalculable repercussions in that volatile area.
Of course I understand the arguments of commercial interest, but I do not believe that it is in the long-term interests of any country to allow those commercial interests to dominate to such an extent that they override concerns for human rights. Nor do I believe that it is the wish of most of the citizens of this country that British money should be used to bolster regimes which systematically perpetrate atrocities against 'vulnerable minorities.
That leads into the second and third issues that I wish to raise, which are interrelated: the need for greater priority to be given to the principles and practices of conflict prevention and conflict resolution. At present the cost in human terms of man-made conflict is enormous. Rwanda and the former Yugoslavia dominate our television screen; but they are a fraction only of the whole story. The war in Sudan, as the noble Lord, Lord Avebury, said, has seen over 1 million dead, 5 million displaced, and many thousands still dying from starvation or treatable diseases. The Kurds and the Armenians face another bitter winter behind their blockades; and the ethnic minorities in Burma remain trapped in the jungle—stateless people fighting for survival. There are many other conflicts elsewhere throughout the world, largely unreported.
In addition to the cost in human suffering, there is the huge economic cost of humanitarian aid, but that is only first aid. So the real priority must be political solutions which will bring peace and justice. That is where we so often run into the impasse created by the conflict between the principles of territorial integrity and basic human rights. The international community seems to be putting a premium on the principle of territorial integrity at the expense of human rights; and in many cases that concept of territorial integrity has no integrity—for example, many of the borders within the former Soviet
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Union, including those of Nagorno-Karabakh, were drawn maliciously by Stalin, designed deliberately to divide and rule and to create conflict.
I illustrate that point briefly with reference to the Armenians of Nagorno-Karabakh. For decades, they consistently suffered severe harassment at the hands of Azerbaijan; then, after the dissolution of the Soviet Union, Azerbaijan threatened to dissolve even the limited autonomous status given to Nagorno-Karabakh by the Soviet constitution and to rename its capital city with a Turkish name; in a desperate measure for survival, the Nagorno-Karabakh authorities resorted to the legal procedures of the Soviet constitution and received a mandate for independence. That was the only legal framework available in which they could operate, and it has of course now become an anachronism. They are thus trapped within the borders of a regime whose rulers have frequently made explicit statements of intention to carry out ethnic cleansing—indeed, that term was first recorded officially in relation to Azeri policies for the people of Nagorno-Karabakh.
Similarly, the people of Southern Sudan and the SPLA-administered areas of the Nuba mountains are suffering from the policy of jihad, waged against them by the government in Khartoum. Last year, flying into the region, I saw painted in huge letters in the mountains above Kadugli in the northern Nuba Mountains the spine-chilling words, "Jihad Kadugli". Therefore it is not surprising that the Sudanese people of the South and the Nuba mountains hope earnestly for the opportunity to decide, in a democratic way, the best future for themselves.
It cannot be reasonable to expect the Armenians of Nagorno-Karabakh or the Sudanese of the Southern Sudan and the Nuba mountains to trust regimes which have subjected them, respectively, to attempts at ethnic cleansing or to a jihad. Therefore urgent consideration must be given to a creative alternative; to a new way forward out of the impasse between the self-determination necessary for survival and the international community's commitment to territorial integrity where regimes have used that principle to perpetrate gross violations of human rights against minorities within their territorial boundaries.
There must also be urgent consideration given to finding more effective solutions to the problems caused by repressive regimes which choose to shelter behind the principle of non-interference in internal affairs. I return by way of example to the problems of the Karen and other ethnic minorities in Burma. They are not asking for a change in the territorial boundaries of Myanmar. All they request is some form of democratic federation, with freedom to enjoy fundamental human rights. Instead, they are subjected to the kind of atrocities to which I have already referred, and remain stateless, trapped and helpless. They feel especially saddened by Britain's lack of initiative on their behalf—referring to our role in their history and the way in which many of their soldiers, especially the Karen, fought with great courage alongside British troops.
It is my hope that the Government will continue their valuable and valued work in the field of humanitarian aid, which is widely appreciated throughout the world.

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It is also my hope that the British Government will fulfil the commitment given in the gracious Speech and take more of a leading role in attempts to stop the kinds of gross violations of human rights which it has been my sad role to witness. I hope, in particular, that the Government will put more pressure on repressive regimes to respect the principles of freedom, justice and democracy. I also hope that Britain will help in the search for new, creative forms of conflict prevention and resolution, especially with regard to those conflicts stemming from the tension between the principles of self-determination and territorial integrity. Until or unless some solution to this problem is found the material cost in humanitarian aid will continue to escalate; but, infinitely more tragically, the cost in human suffering will also escalate.
Many people whom I have been privileged to be with in their dark and difficult days—in Sudan, in Burma, in Armenia and in Nagorno-Karabakh—still look to Britain with a special hope. They believe that we not only have a particular responsibility, stemming from our historic involvement in their nation's development, but that we have a particular understanding of their predicament and consequently we can make a uniquely sensitive and appropriate contribution to the search for peace and justice. I hope that we will not disappoint them in their hour of need.
8 p.m.
Lord Desai: My Lords, we have been debating the Queen's Speech since three o'clock and we have heard some fascinating speeches. We have also heard two excellent maiden speeches. I enjoyed in particular the speech of the noble Baroness, Lady Rawlings, who was able to interconnect issues of heritage, identity and foreign affairs.
Foreign affairs, overseas development and defence are intimately interconnected. They are not separate, as was implied by the noble Lord, Lord Mayhew. Interconnections are sometimes virtuous and sometimes vicious and I wish to point out some examples. In many parts of the world, human rights, humanitarian assistance, development and armaments interconnect either to create or to solve problems. We know that a number of countries have had to ask for humanitarian assistance from the United Nations. Those countries have suffered enormous problems of poverty and discrimination on the grounds of ethnicity or tribal differences. No matter how poor in terms of per capita income, some regimes have found the means to buy large amounts of armaments. Indeed, some of the governments providing humanitarian assistance have also sold them armaments.
Perhaps I may also point out one or two virtues of interconnections. In our recent debate on the defence estimates, it was agreed that one of the welcome aspects of the UK defence policy has been the steady reduction of the share of defence in our budget and GDP. I welcome that; it has been carefully done. However, I should like to see some of the peace dividend directed into overseas aid. We always complain that there is not enough money and that there are other things to do, but
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in terms of our GDP and the need that exists we give too little to overseas aid. As was urged by the Human Development Report of 1994, it would be desirable to have some of the peace dividend directed to the urgent issues of development.
In that respect, the peace dividend should come not only from the developed countries of the West but from the developing countries. One of the principles that should guide us in giving aid is to ask whether the countries are using their resources successfully. For example, are they spending more money on defence while cutting their social welfare expenditures? We should also ask whether there are more soldiers than teachers in those countries and, if so, why should they receive aid.
The right reverend Prelate the Bishop of Worcester, who is no longer in the Chamber, commented on structural adjustment and the role of the World Bank in that. Many people blame the World Bank, but some structural adjustments have been virtuous and countries have protected their social welfare programmes and adjusted. There have also been structural adjustment programmes for which countries have seen fit to blame the World Bank or the IMF. Those countries have continued in their bad habits and visited the costs of structural adjustments on the poor.
We can no longer take the view that the Third World is passive, exploited and somehow innocent; that all evil comes from here and goes there. We must carefully differentiate within the third world. Some countries are newly industrialising and rapidly developing. Indeed, some are prospering so much that they hold out large potential markets to us. If a large contract is to be given for defence purposes it is easy not only for the UK but for other countries to forget or to suspend the issue of human rights. Indeed, often the left hand does not know what the right hand is doing—it certainly does not admit that it does.
I have the greatest respect for the noble Baroness, Lady Chalker. However, I thought she was a little too casual in denying any connection between our defence sales and development. We must make up our minds about this matter once and for all. We must say either, "Yes, there is a connection. So what! We are creating jobs"; or, if there is no connection, we must be scrupulous in providing full and complete evidence of that. The noble Baroness referred to a lack of pattern and correlation.
A single instance of interconnection between defence and development if it is not intended by us should be censured. In that respect, I recall the previous occasion on which we discussed the Pergau dam, thanks to the efforts of the noble Lord, Lord Redesdale. The noble Lord, Lord Prior, spoke in that debate and declared an interest as being involved with GEC in Malaysia and a former Cabinet Minister. He said:
"What are the facts? I shall try to give them as I see and know them. First, Malaysia indicated that it wished to place large defence orders with Britain of about £1 billion, which it would pay in cash. In fact, the orders have amounted to about £1.5 billion and the Malaysians have paid in cash. Quite understandably, Malaysia said at the same time, 'If we place this order with you, will you aid us in a major project that we badly need?'. It is not surprising that the Malaysians asked for that and it is not surprising that the British

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Government said, 'Yes, we'll give you some aid'. If there was a `tangle', to use the Foreign Secretary's words, about whether the two issues were contingent upon each other, it is a perfectly legitimate and reasonable cause for inquiry by the press and Opposition".—[Official Report, 2/3/94; col. 1039.]
The inquiry was made. If the noble Lord, Lord Prior, said that he knew that such an interconnection existed, why was something not done about that? When the noble Baroness, Lady Chalker, summed up the debate, she referred to the speech but she did not deny what the noble Lord, Lord Prior, said.
The noble Viscount, Lord Weir, who spoke in the same debate said:
"Our aid budget is puny compared to the problems of the less-developed world, and there is little chance of it being increased; our balance of trade is horrible; our unemployment is high and much of industry is working below capacity; and, finally, the competition for international business is fierce".
He ended by saying:
"Frankly our economic circumstances today are such that, sadly, I believe we can only really afford such forms of economic aid as give our industry some measure of benefit in return".—[Official Report, 2/3/94; col. 1047.]
That is fine. I do not mind that. Let the DTI do that. I am not against giving subsidies to British industry because that may create jobs but let us not pretend that that is being done for some purpose other than giving development aid.
The Government should be clear in their mind, if not in public, as to what is the purpose of the aid. It is no good saying that it is only 10 per cent. of our budget. It is not a question of size but a question of principle and we must be clear about it.
Some noble Lords have mentioned Indonesia. Perhaps there is no connection; who knows? We shall have to wait until another NGO takes a case to the High Court before we find out because there is no other way in which to do so. Whether or not there is a connection, I am concerned about the current human rights violations in Indonesia. I should like to mention in particular the fate of a fellow academic, Dr. Aditjondro, who has been threatened with arrest by the Government because he pointed out that a number of newspapers were suppressed and that a number of NGO workers had been threatened with arrest just before the recent APEC conference in Indonesia. I urge the Government to protest against such human rights violations. Again, there is no quid pro quo. It is a matter of principle. But we must make it extremely clear that human rights violations should not be tolerated.
The question of European integration and the expansion of European markets is not just a problem of European foreign policy; it is a problem of development policy, especially the reform of the common agricultural policy. I agree with the noble Lord, Lord Cockfield, who knows more about that than any of us. It may be that in 1996 we shall not be able to make any new initiatives with regard to policy, but the agricultural policy reform process, which has already started, should be strengthened and accelerated.
The CAP is a great drag on third world agriculture. It not only harms us, it harms the world at large. It was extremely shocking that the GATT negotiations were held up before they were completed in order to gain a
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concession with regard to the dumping of agricultural exports that France regularly undertakes. In order to accommodate that dumping we had to make special concessions within the common agricultural policy. Such interconnections—what I call the vicious interconnections—between foreign policy development and humanitarian assistance should be warned against.
Finally, I was fascinated by the speech of the noble Viscount, Lord Waverley. I have always thought that I should never speak on Kashmir unless I could speak for at least five hours because it is a vast subject and I know quite a lot about it. I should point out that the problem did not start in 1947. It started long before that and is connected with a rather arcane doctrine of paramountcy which we had during the time of the empire. That made the status of native kingdoms rather peculiar. Of the many native kingdoms which signed up with Pakistan or India, only Kashmir was an exception and that was connected with that problem of paramountcy before and after independence.
I should say to the noble Viscount that, as he pointed out although he did not follow his own advice, it is not helpful to go back over the history of such cases. In such cases history is an obstacle rather than a help to solving the problem. We have had the Irish problem for a long, long time and it is still not solved. When Americans tell us how to solve the problem, we do not like that. I do not believe that India and Pakistan would like somebody from outside telling them how to solve their problem.
I believe that the Kashmir problem will be tackled when the people within India and Pakistan, people in a civilised society, rise up and say, "We do not like our countries doing those things to the people who are, after all, our brother citizens". That is the one hope that I have with regard to Kashmir.
This has been a fascinating debate which I have enjoyed greatly.
Viscount Waverley: My Lords, before the noble Lord sits down, will he accept that there is an effective stalemate in the search for a solution and that we need to find the common ground which exists between all the participants in the dispute in the hope that the deadlock may be broken?
Lord Desai: My Lords, I agree with that without necessarily endorsing all the other things which the noble Viscount said. I agree that at present there is a stalemate. The countries are both nearly nuclear powers and we must do all we can to try to assist. But as in the case of Palestine and Israel, a nation unconnected with the past of the region, rather than Britain, may be more helpful in solving the problem.
8.16 p.m.
Baroness Park of Monmouth: My Lords, I too should like to thank the two maiden speakers for their very different but deeply interesting contributions. We were extremely fortunate and I look forward to hearing from them again.
We are told in the gracious Speech that the Government attach the highest importance to national security. According to the defence statistics published

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last month, our defence expenditure for 1994–95 is estimated at 3.4 per cent. of GDP, going down to 2.9 per cent. by 1996–97. The Russian defence budget is 5.8 per cent. The Russian draft budget for 1995–96, which has just been published, allocates 21.7 per cent. of total expenditure—0.7 per cent. up on 1994—to defence. The total includes the Ministry of Atomic Energy's spending. Of course that is a draft budget, but Chernomyrdin, the Prime Minister, has already said:
"In no way shall we squeeze or decrease defence expenditure because it is this country's holy of holies".
I thought that the defence of the realm was deemed to be the first duty of the Government in this country too, but the figures and the facts speak for themselves.
Pavel Grachev, the Russian Defence Minister, told the Russian armed forces in the Far East at the end of October that the programme to equip the army and the fleet with new, more modern types of arms would not be wound up but, on the contrary, would continue to be developed. Russia may not have electricity or money to pay the miners but it appears that it will always have money for defence.
The gracious Speech continues by saying that the Government,
"will work to continue the process of NATO's adaptation to the changing security environment to allow it to play a wider role in protecting stability throughout Europe".
But whose will be the agenda? The partnerships for peace are both emasculating NATO and giving Russia, through its CIS partners, full power to observe and influence. There are now 30 Russian military bases in CIS countries and a number of CIS countries have joined the partnership for peace.
Grachev said in May that Russia's entry would make it possible to obtain more information about the military-political intentions, plans and actions of NATO—and to influence them in Russia's interests. He added that Russia is a superpower and, of course, would not toe NATO's line.
Just as the Ukraine and Belarus in earlier times had independent status in the UN, so there will now be a solid bloc and presence within NATO, even if at this stage only peripherally, owing allegiance to one country, Russia. There are no prizes for guessing which way its influence will be exerted should we, for instance, contemplate admitting the Visegrad countries or the Baltic states to NATO membership.
Are we already tacitly accepting the Russian right to veto, and thus acknowledging again a Russian sphere of influence? Kozyrev warned Gebhard von Moltke, the NATO Deputy Secretary General, earlier this month that the nationalists would take advantage of such ill-considered steps as the hasty expansion of NATO membership, and Russian deputies told our own visiting parliamentary delegation recently that the entry of the east European countries into the NATO bloc would be considered a threat to Russia's national interest.
It may, indeed, be premature to consider expansion, and important not to allow Russia to feel threatened. But I hope that we are remembering that the Russians have
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every interest in encouraging that view and thus exercising, effectively, a veto on almost any NATO course of action.
Could we, too, remember that the Poles, for instance, were our allies and paid dearly for it? By being seen to accept the Russian "right" to veto, and condoning the Russian tactic of destabilising NATO from within, we are also sending alarming signals which can only encourage the old Communists who are returning to political power in Poland and in Hungary and who will thus be more vulnerable to Russian pressure.
The speech goes on to say that we shall seek to enhance the role of the CSCE in Europe in conflict prevention and resolution. The CSCE is no doubt a worthy concept, but it is an emasculated 53-nation version of the UN with all its weaknesses and none of its limited strengths. It has been largely, if not wholly, ineffective both in Nagorno-Karabakh and in the Abkhazian-Georgian conflict. And it is precisely the organisation which the Russians wish to promote because it has no power to enforce.
Kozyrev said in June, after discussing the partnerships for peace with the North Atlantic Co-operation Council:
"the main aim is to direct every effort towards the formation of a single Europe in which the main role, NATO and Russia were agreed, would go to the CSCE".
The CSCE has not yet resolved a conflict and has neither the power nor the muscle to enforce anything. It would indeed suit Russia for the CSCE and not NATO to be given "the main role in Europe", whatever that is.
Russia's whole tactic is, first, to encourage NATO to unravel and to lose its central purpose, which was and is to prevent aggression by being seen to have the power to deter and the united will to use it; and, secondly, to provide us with a reassuring substitute for the CSCE which will keep us all busy and which has the great advantage of constituting no deterrence whatever. Without a serious defence capability, it will be useless for us to have a foreign policy. We shall be seen to be completely toothless.
I am glad to note that the Government will work for the full implementation of the Conventional Armed Forces in Europe Treaty which the Russians are now challenging. It may be relevant that Russia is now to have a fighter base stationed in Armenia. Lastly, we are to maintain our nuclear deterrent. That is just as well. A new and sophisticated atomic submarine, part of Russia's new programme, completed its trials last week and will soon be joining the fleet.
I have concentrated on Russia's defence capacity, the build-up of Russia's power and ambitions and Russian tactics to manoeuvre NATO to her advantage, because our own drastic and premature defence cuts were all predicated on a weak and helpless Soviet Union. The CIS is far stronger. It is scrapping its obsolete weapons in favour of new ones, it has chemical weapons and was still manufacturing biological weapons in 1992, and it remains politically unstable. But the real threat lies in Russia's power in future to hold us all to ransom and to take back her old sphere of influence without the need to go to war, simply because we have relinquished the capacity to deter. It was our clear duty to retain a

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credible degree of force. We have not done so, and we shall pay the price for our criminal complacency and our refusal to face facts.
8.25 p.m.
Lord St. John of Bletso: My Lords, earlier this year the world looked on in wonder as South Africa was transformed into a new-born democracy. Where many had expected bloody revolution and conflict, there suddenly appeared national reconciliation and, amazingly, peace. A number of noble Lords acted as observers during the April elections. I am sure that they would testify to the remarkable nature of the historic events that culminated in the inauguration of Nelson Mandela as the new state president.
Seven months on, the world's gaze has moved on and massed legions of international media have found new stories. Yet, South Africa's greatest challenge is just beginning—the building of a new nation at the foot of Africa. Ever mindful of the enormous task that lies ahead for President Mandela and his Government of National Unity, I was particularly pleased that Her Majesty's gracious Speech pledged to continue the Government's support for,
"consolidation of a peaceful and stable democracy in South Africa".
Britain retains both a secure interest and a special influence in South Africa's future. British investment in that country currently has an estimated market value of £9 billion to £10 billion, more, in fact, than British investment in the whole of the rest of the African continent.
The most visible expression of those links will certainly be Her Majesty's planned visit to South Africa during March next year. Such an event will bestow a unique seal of approval for the new nation. Certainly the Prime Minister's recent visit was a great success and, following South Africa's recent return to the Commonwealth fold, Her Majesty will be assured of a most warm and enthusiastic welcome.
Clearly President Mandela has an uphill battle on his hands —not only to endeavour to meet the high expectations of many of the peoples in South Africa, but also to upgrade and improve education, training, housing needs, hospitals and, of course, the reduction of poverty through the creation of jobs. Those objectives were, to a large degree, incorporated in the White Paper on the reconstruction and development programme of the Government of National Unity, the so-called RDP programme. Many observers have suggested that the RDP programme is unrealistic. However, I believe that with a concerted international assistance programme, the ambitious targets for housing, employment and living standards can be realised.
The targets have not just been plucked out of the sky. Instead, they have been rigorously assaulted by a wide range of committees, task forces and forums established throughout South Africa to facilitate co-operation and consultation before implementation of the reconstruction and development programme. Of course there have been problems as well. An ambitious housing programme with the aim of building 1 million homes within the next five years has yet to gather steam as the Government carefully weigh up the merits of self-build schemes
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against fully developed estates. The former are quickly delivered but can easily grow into urban slums, while the latter are more costly but also more likely to meet the public's expectations.
With estimates in South Africa of one-in-four blacks living in squatter camps, with over 40 per cent. having no access to clean water, with about 50 per cent. of all black South Africans being illiterate and about 25 per cent. not being in school, the challenges for Nelson Mandela are immense.
However, a lot of assistance has been and is continuing to come from Her Majesty's Government and the international community. When I was in South Africa recently I read that by the middle of September almost 11 billion rands—that equates to about £2 billion—had been received in foreign aid since the Government of National Unity took office in May. I have always contended, though, that it is not just monetary aid but logistical, practical assistance that is needed in South Africa. I shall give an example.
One of President Mandela's pre-election promises was to provide a meal a day for all black schoolchildren. However, when it came to the logistics of implementing this ambitious scheme in all the provinces and regions, it became an administrative and practical nightmare. It was then that he called on the assistance of one of the largest food manufacturing companies to help out. It consulted many of the education and health authorities throughout South Africa and came up with the solution of a peanut butter sandwich! This group has profited in that not only is it now providing the bread, margarine and peanut butter, but also many jobs have been created in the informal sector in the making and the distribution of these peanut butter sandwiches in all the schools around South Africa. In fact within just four months almost 3½ million black children are receiving their meal a day. This is just one small example of how the Government's objectives can be met through co-operation with the private sector.
What I believe is important to appreciate in South Africa is that for many years the ANC was a protest party and hence had limited practical hands-on political experience when it came to power this year. I feel it is remarkable what it has managed to achieve in just this short amount of time. I welcome the Prime Minister's pledge of £100 million in aid to South Africa over the next three years. The impact of British support has been keenly felt in many areas, not least in the establishment of sound local government, health, agricultural policy, the creation of employment opportunities and the gradual integration of the new defence force, arguably one of the greatest challenges facing the new South Africa today.
The recent establishment, on the instigation of the Minister, the noble Baroness, Lady Chalker, of the British South Africa All Party Parliamentary Group will be furthering the objective of consolidating a peaceful and stable democracy in South Africa. I would have liked to talk on the issues of law and order, more specifically the major problem of violent crime in South Africa, as well as the relationship between the unions (more specifically, COSATU) and the Government, as well as the economic prospects for South Africa, but as

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the twenty-eighth speaker in today's lengthy debate, I feel it is only right that I curtail my remarks and bring my speech to a close.
Clearly there is, and shall be, no quick fix to the problems and challenges facing the new South Africa. President Mandela and also Vice-President F. W. de Klerk have embarked on a remarkably successful journey of national reconciliation. The threat from the Right-wing that once appeared capable of destabilising the entire population and the entire transition has been defused if not destroyed.
The Government have begun the lengthy and potentially divisive task of thrashing out a final constitution for the country. All over the country the transformation is quietly continuing with residents of white suburbs and black suburbs finding ways to co-operate in local government and integrating state schools and hospitals. The miracle is continuing quietly in South Africa. My conclusion is, better a steady start than a false start in this exciting new era for South Africa.
8.34 p.m.
Lord Vivian: My Lords, the gracious Speech gave great importance to our national security. The recent announcement made by Her Majesty's Government that they are not contemplating any further cuts to ships, regiments and aircraft has been warmly welcomed by all the armed services. It will allow a period of stability for consolidation and reorganisation which is essential after all the changes that have been implemented so recently.
The threats and risks that face our country are very real nor have they faded away as some would wish us to believe, as noble Lords have just heard in an excellent speech by my noble friend Lady Park. However, the threats to the United Kingdom that have to be faced require a strong and well trained Navy, Army and Air Force equipped with the latest weapons systems and with an Army of around 130,000, an additional 10,000 troops on the present ceiling of 120,000. That would allow current Army regimental establishments to be increased ensuring that there are sufficient numbers available to carry out their tasks and operational commitments. From this increase infantry battalions could be given back their fourth rifle company thus allowing battalions to carry out operational tasks without resorting to having to borrow a company from another battalion which creates turmoil in the lending battalion when it is earmarked for an operational tour. It would also assist the Foot Guards with their public duty commitments in London and prevent non-Foot Guard battalions from having to do public duties which, in its turn, takes those battalions away from their primary roles.
Our defence against any threat to the United Kingdom must be strongly based on our commitment to NATO, as stated in the gracious Speech. Our earmarking of troops from the central multinational division and from our amphibious forces to the Western European Union is important. We have been informed that the United Kingdom is playing a full part in the Western European
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Union's operational capabilities; and that the WEU planning cell is working on plans for possible missions and is drawing up lists of forces which could be made available by nations to the WEU. But who and what will be the delegated command and control authority for combined joint task forces working for the WEU? Or, put another way, is there a combined and integrated military staff to act as the WEU command and control authority? Perhaps my noble friend could provide some additional information on this point.
This brings me to one of the aspects of the defence costs study—namely; that of the defence intelligence staff—which was not due to report until the end of July and received little attention in the defence debate in the other place last month. It concerns reductions in the DIS. Perhaps I should declare an interest here as I worked in that organisation in the early 1980s.
With the depleted armed services that our country relies on there is an even greater need to have more time to analyse, assess and identify any potential aggressor to this country. This measurement of time cannot just be in years but is more likely to be in decades if we are to construct the necessary weapons systems for our defence. The DIS is a frontline unit and I ask my noble friend to take note of this. It is vital to the country's interests in peacetime. Strategic and tactical intelligence are critical to the service chiefs and without accurate, reliable and timely intelligence the wrong planning may be implemented and disasters may well follow. Can my noble friend give an assurance that the service chiefs and the Foreign and Commonwealth Office have no objection to the proposed changes that have been recommended by this separate defence costs study report?
Field training for the Army, even with the introduction of simulation, is still a key part of its training, and the availability of areas on which the armed services can train is essential if their skills are to be kept at the highest level. A low standard of training may bring us defeat in battle, and I feel that I should draw your Lordships' attention to the fact that some of the Army standards are not as high as they used to be. In particular, I would point to all arms training and higher formation training, little of which has been carried out in the past three or four years with the full complement of troops. For instance, during the recent First Brigade exercise on Salisbury Plain one of the three infantry battalions of the brigade was in Bosnia, another in Northern Ireland, and one of the tank squadrons of the Armoured Regiment was similarly absent.
Even battle group training at BATUS in Canada has been denied its integral infantry companies due to overstretch caused by the additional burdens of Bosnia and Kuwait. For instance, in 1993 only five of the 12 required infantry companies were available, and armoured regiments exercised without infantry. I hope that the figures for this year will prove to be better, because if battle groups do not train as a complete all-arms group with all their infantry, tank squadrons, artillery, engineers and supporting forces their skills and drills will only deteriorate.

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I have corresponded with my noble friend on the difficult matter of field training areas in Germany. He wrote me a most helpful letter on 30th September. He informed me that no military training could be permitted in the east of Germany until the Russians had completed their withdrawal last August. Can my noble friend now inform the House what negotiations have taken place, which areas in the east of Germany have been selected, and whether the Letzlingen Heide training area is one of them? It is, quite clear that the Hohne/Bergen dry training area is too small for realistic battle group training.
Turning to military training areas in the United Kingdom, it is clear that greater use will be required of the existing areas and that some of them may have to be enlarged. In this respect I am aware that improvements are being made to Salisbury Plain for more use by tracked vehicles and greater use of Otterburn for the artillery. What use is being made of Castle Martin, and does the German Army really need that area when it now owns large training areas in the east of Germany? Should we not fly our troops back for tank firing on the Castle Martin ranges, thereby saving the £4 million spent annually on the Hohne/Bergen ranges in Germany?
The country will not have an Army of the appropriate standard unless it is given the right areas to train on. The Army is highly conscious of the need for conservation, and in some areas, because of restrictions on the public, flora and fauna abound more on military training areas than elsewhere. The MoD is a good landlord and surely it would be easier to enlarge existing training areas if necessary than to try and find new ones.
The defence debate in another place last month laid great emphasis on the replacement for the Hercules aircraft. I do not intend to cover any of that ground again. However, it is essential that a decision is made on the number of Apache attack helicopters, EH101 and Chinook helicopters, which are all urgently required.
The defence costs study introduced the concept of a permanent joint headquarters. Although on paper I can see the logic of that proposal, in reality is it really so necessary? Can it be afforded? The Royal Navy conducted the Falklands campaign from Northwood with excellence; the Royal Air Force, from High Wycombe, conducted the Gulf campaign with equal excellence; and the Army is now conducting the Bosnian operation from Wilton with the same excellence. The adaptation of Northwood, with all the additional necessary construction and communications equipment, will be exceptionally expensive. It may well be that there is a need for a permanent joint headquarters, but it needs further examination. And do the service chiefs agree to those new headquarters? Are Her Majesty's Government sure that the number of crises during the past 10 years or so justify an expensive and separate new organisation?
I do not intend to cover the topic of Northern Ireland in detail as it was fully debated in your Lordships' Chamber last month. However, like many of your Lordships, I too should like to sound a word of warning. The terrorists in Northern Ireland continue with their intelligence collecting activities. There is no agreement
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by the terrorist organisations to hand in their arsenals of weapons and explosives. The severe beatings-up and kidnappings by the IRA continue. We must continue our intelligence collection, continue to ensure that we have sufficient trained troops in Northern Ireland to support the Royal Ulster Constabulary, and continue our policy of caution when reviewing the next steps to take.
The gracious Speech referred to the United Nations. For the past few years, and I suspect for many years to come, this country has been making military contributions to the UN. Our Armed Forces have now been reduced so much that it will be difficult to agree to provide support for the UN in response to every request, especially as we are already committed in Cyprus and Bosnia. It would be particularly wasteful to have standby forces available only for UN deployment. Other countries should take on more of these burdens, but that is not feasible until they have been trained in UN duties.
A private study is about to be undertaken with a view to determining how the military and humanitarian organisations can have a better understanding of each other. One of the conclusions from that study may be to recommend the formation of a United Nations training school for instructors in the United Kingdom to enable other countries to send their instructors to be trained in the UK before returning to train troops in their own countries. The United Kingdom is held in the greatest respect by other countries for its knowledge of UN matters. The country would once again be seen to be taking the lead in helping the United Nations, which ultimately should assist us in that we would not be called upon so frequently to provide military forces to support UN operations.
I should like to draw your Lordships' attention to the future defence medical services. In February 1993 the future requirements for secondary medical care in the Armed Forces were announced. A review was carried out based on a fundamental reassessment of the potential for conflict in the world and the consequent changes in defence policy and the new structure and size of the Armed Forces. It concluded that there was a need for about 1,200 beds to be found in three military hospitals, with three or four military district hospital units inside National Health Service hospitals, and with the National Health Service sharing the Army facilities at the Catterick military hospital.
About 18 months later the defence costs study announced that there was now a requirement for only some 700 to 800 beds in the United Kingdom rather than the 1,200 previously postulated. It further announced that the planned four military district hospital units would remain but in future there would be only one service hospital—Haslar at Portsmouth—with a requirement for only 375 beds. With only one service hospital it will be impossible to retain and train the 1,500 doctors and dentists and the 7,000 nurses and supporting staff, even though it has been agreed that those numbers should be reduced by 20 per cent. If that situation is allowed to happen the unique specialty of operational military medicine will not be forthcoming as service hospitals in the United Kingdom represent the only peacetime environment in which the various command, clinical, administrative and logistic skills can

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be brought together, exercised, maintained and evolved. Without that training the mix of doctor, nurse, technician and paramedical skills essential to the war task would not be met. These further cuts and reorganisations announced in the defence costs study need further examination and more detailed justification. I ask my noble friend if this matter can be re-examined.
In conclusion, our Armed Forces are the finest in the world and we all owe them a great debt of gratitude for preserving our freedom. It is our duty to ensure that they have sufficient resources for training and are given all the support they need to enable them to execute their tasks in the highly professional and successful manner to which our country has become so accustomed.
8.50 p.m.
Lord McNair: My Lords, I regret that I was not able to get together with the noble Baroness, Lady Cox, before the debate since we both visited the Sudan this year; the noble Baroness was able to do so more extensively than I did during my stay there. In what I shall say about the Sudan, I do not mean to deny, or necessarily contradict, all that she said about that country. Your Lordships know only too well her dedication to and support for oppressed and persecuted people everywhere. What I shall say is in addition to what she said. I travelled in September from Kadugli to Dilling by night in a convoy of three vehicles. The only security presence that we saw was a few simple checkpoints at the roadside. It may be that we did not travel through the area where the situation that the noble Baroness described exists. However, that was my experience.
I shall be speaking about two areas of the world, each geographically distinct; but the issues at which I wish to look are connected. They concern the new fracture line in international affairs and its implications for human rights and world harmony. The areas on which I wish to focus are the Sudan and Germany.
With the end of the Cold War—I bear in mind the remarks of the noble Baroness, Lady Park—and the reduction in the reach and power of the countries making up the former Soviet Union, a more real division has opened up as the ice floes of the Cold War break up and realign.
It is clear that the most important international question concerning and confronting the West is the resurgence and increasing self confidence of the many different nations where Islam is the dominant religion and culture. Coupled with that is the increase in migration which followed the colonial era resulting in significant racial and religious minority populations in many of the industrialised countries irrespective of whether or not they were significant colonial powers.
Islamic countries vary enormously in their political institutions, social customs and outlook on the world. Historically, from the time of the Crusades, through the 19th century to the present day there has been conflict and misunderstanding between the Moslem and the Christian cultures. As the world of Islam reasserts its right to order its societies according to its own precepts,
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the western world is becoming increasingly nervous about where that may lead. Primary western concerns are, as always, oil supplies and export markets.
It is true that Iran, for example, operates a foreign policy that is actively hostile to the West. Other countries such as Egypt and Saudi Arabia have set their face against Islamic resurgence and have been well rewarded by the West for so doing.
It is particularly important that the West should realise that for Moslems the Sharia is a way of life that prescribes both personal conduct and the system of justice which operates in the courts and judicial system. I visited the Sudan recently as a guest of the Sudanese Government. While there I asked one highly placed official how he would define Sharia. He thought for a moment and then told me, "Sharia is a path to God". There seem to be as many interpretations of Sharia as there are Islamic nations. In some it seems to be used as an instrument of state repression. In others, the draconian punishments often cited are rarely used. Whichever is the case in a particular country, it is important to realise the extreme sensitivity with which the Sharia is regarded by Moslems. I am not saying that this sensitivity should override fundamental human rights issues. But what I am saying is that since according to the teachings of Islam the Sharia is the word of God, the West would do well to take that into account in public pronouncements.
An example is the comment of the United Nations special rapporteur on the Sudan, Gaspar Biro, when he referred to the Sharia in critical terms by saying "…whoever the author". I can well understand that there may be genuine human rights considerations about some aspects of the Sharia and the way in which it is applied. But that reference had the equivalent impact on a Moslem that a non-Christian questioning the Virgin Birth and the Resurrection in the same sentence, and then some, would have on a devout Christian.
The nations of the Islamic world are watching us see how we live up to the principles that we seek to impose on them and how we confront the playing out of religious and racial diversity in post-colonial societies. Remember also, my Lords, that in many countries there are now significant Moslem minorities. Since it is a fact that most Moslems are not white caucasians, those living in western countries may be in double jeopardy on account of their religion and their race. In a violent world, which is the greater evil—to be stabbed to death at a bus-stop because you are black; or to suffer the amputation of a hand following established judicial procedures? I make no judgment. I only ask the question.
It pains me that the West's attitude to human rights observance too often tends to be distorted by perceived foreign policy interests. For example, the human rights records of Egypt and Saudi Arabia are rather bad. Egypt is said by Amnesty International to have 20,000 political prisoners and the Egyptian Government admit to 12,000. I do not think that anyone is suggesting that the Sudan currently has more than a relative few by comparison. Yet Her Majesty's Government, the USA and some other European countries have decided to make an example of the Sudan. Because it stayed neutral in the

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Gulf War, the USA has added the Sudan to its list of states sponsoring terrorism. However, despite repeated requests for specifics by the Sudan, the American Government have failed to supply any evidence.
That policy may well be counter productive. The Sudan is well regarded in much of Africa for standing up to what is seen as bullying by the West. It is also taking a regional leadership role and exporting its culture to neighbouring countries. The West seems to be having difficulty in coming to terms with the fact that certain countries are ordering their societies on the basis of religious or spiritual values. That is seen as something dangerously unpredictable and radical.
The attitude of the British Government to the Government of the Sudan has echoes of the old colonial mentality. I was quite appalled at the arrogance and insensitivity which I witnessed and heard about and not at all convinced that in September when I visited the Sudan the human rights situation was as bad as was made out. For example, a member of the Government was perfectly at liberty to go to the British embassy and complain about the Government of which he was a member. That seemed to me to be quite remarkable.
It is true that political parties are banned. However, the feeling in the Sudan is that those parties have not served the country well in the past and that the country needs to break out of the cycle of multi-party government followed by military dictatorship with the pattern repeating over and again. The International Commission of Jurists and Amnesty International have both arranged to visit the Sudan this month by agreement with the Sudanese Government. I look forward to reading their reports.
The two themes which were emphasised most often when I was in that country were development and religious tolerance. It was a Friday when we visited the women's prison at Omdurman and prayers were in progress—one was a Christian meeting, the other a Moslem one. Both seemed fairly well attended. The women were free to attend whichever meeting they chose. Presbyterians were running the Christian meeting on that day. As well as religious subjects, such topics as hygiene and childcare were covered. The missionaries present told us that on different days an Episcopalian minister and a Catholic sister also visited the prison. I understand that at the beginning of October all the women, except six who had been sentenced for murder, were released under an amnesty. However, that was in Khartoum, in the Moslem north.
One of our two hosts for the visit was a Christian evangelist member of the Transitional National Assembly who had given up travelling the world to spread the Gospel and is now working with the Government. In the two southern states that we visited we found a spirit of co-operation between religions with members of all faiths represented in the state governments. It will be interesting to see the make up of the new state administrations after the elections which, I believe, are planned for March 1995.
I turn now to Germany. It is clear that recent events there give great cause for concern. In Germany under Chancellor Kohl there are chilling echoes of the Nazi era. Incidents of racial violence are increasing
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exponentially with the police seemingly powerless, or unwilling, to do much about them. The figures and some examples speak for themselves. In the year of unification, incidents of extremist violence totalled 375. The following year they totalled 1,275. In 1992 the total was 2,285.
Once again, Jews are the victims. In March this year a synagogue was firebombed; the first such attack since the war. That is not an isolated incident. The hate letters and death threats received by Jews in Germany are now signed, whereas in recent years they were anonymous. That shows the increasing acceptability of overtly racist behaviour and the confidence that the authorities will do nothing to help the victims.
Recently, a mob of Right-wing extremists attacked a group of five black Africans and destroyed a local restaurant owned by Turks. Of the 50 rioters arrested in broad daylight, the police released 49 immediately. However, they detained a Turkish waiter who had stabbed a rioter in defence of the African men.
Skinheads, however, are not the only perpetrators of violence. Despite the attempts of the German Government to convince the world that teenage skinheads are the sole perpetrators of violence, investigations by human rights groups have uncovered brutal treatment of minorities by the German authorities. Gunther Grass, Germany's leading novelist, said:
"The most dangerous thing is we have skins in the government. They are nicely dressed with beautiful hair, educated. They speak well. But they think the same way as the young kids who shave their heads and carry swastikas and demonstrate. They encourage these ideas and these brutal actions".
A typical incident reported by Amnesty International concerned a Sri Lankan who was stopped by two plain-clothes police officers while cycling to work. He was accused of stealing the bicycle for which he had a receipt; he was handcuffed so roughly that his wrist was broken and he was imprisoned until the police realised that there was nothing with which they could charge him.
One entire law enforcement unit was disbanded when it was learnt that the members had been equipping themselves with wooden clubs which would deliver more punishing blows than the standard issue rubber truncheons. Twenty-seven police officers were recently suspended in one Hamburg precinct for beating gaoled foreigners, and the authorities announced that they would reopen investigations into 127 brutality complaints. The top law and order figure for Hamburg, the Interior Minister, Werner Hackman, was forced to resign following a public backlash against widespread police brutality.
Rather than confront the reality of Germany in the 1990s, the Kohl regime has chosen to sponsor an exhibition in Washington which puffs up the myth of German resistance to neutralise the media coverage in the United States which has focused on the rising violence and injustice in Germany. Chancellor Kohl and his colleagues perceive the reporting as unfavourable to Germany's carefully groomed public image.

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The supporting literature for that exhibition abbreviates Jewish resistance to the Nazis to a single page and downgrades the Warsaw ghetto—that heroic symbol of World War II resistance—to one sentence. The Washington Post commented:
"The intended audience seems not to be the casual visitor, but history itself—the version that will be passed on through teachers and textbooks. That's why it was so important to the Germans to place the exhibit in Washington".
Chancellor Kohl is still making excuses for the past rather than facing up to the present reality. It is quite clear that he lives in a fantasy world. That state of affairs is extremely dangerous. Just because my father's generation—and in fact many of your Lordships also—saw the horror and said, "Never again", it does not follow that the past will not be repeated in the not-too-distant future.
The familiar process, however, is beginning to unfold: first, a group is identified, targeted and stigmatised. That makes it acceptable to carry out acts of violence and to deny members of that group normal civil rights. The next stage is the economic strangulation and then the ghetto. I do not need to spell out the rest.
One tragic aspect of that situation is that Kohl has allowed his agenda to be dictated by a relatively few neo-Nazis. It is clear that most Germans are horrified by the slide into racial violence which is now hardly even reported in the German press. Racial violence has become so commonplace that in Germany today it is not even news. The neo-Nazis are driving down their ordinary, decent countrymen into apathetic acquiescence.
I urge Her Majesty's Government to confront what is really going on in Germany and to stand four-square with the great majority of the German people, firm and resolute against the destabilising momentum of far Right extremism.
9.4 p.m.
Lord Butterworth: My Lords, one is aware that in Britain today the essence of the Union or the Community is often considered to be the single market, in some places still referred to as the Common Market. However, the founders of the Union and most of the member states would go much further. They are convinced that by economic and monetary union and by political convergence a new realité politique will emerge, the "ever closer union" referred to in the original Treaty of Rome, gradually being elaborated and concretised through the Declaration of Strasbourg, the Single European Act and the Maastricht Treaty, a continuous evolution which will no doubt be pursued a stage further in the intergovernmental conference in 1996.
In considering what the United Kingdom's position ought to be in that field, I submit that we should take into account a change that has begun to occur. It began in the middle of the 1980s and has gathered pace. At this late hour that is the only point that I wish to make.
Britain's trade with Europe has constantly been expanding and the general expectation has been that our trade with Europe would continue to expand and that
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the bulk of our overseas investment would be attracted to the European market. In fact, while Europe has remained central to our economic strategy, the reality has worked out somewhat differently. Maybe because of Britain's imperial and colonial tradition, UK companies have a marked preference for a geographical spread of activities throughout the whole world to a much higher degree than is the practice in many other countries. Our direct overseas investment is not overtly influenced by geographic proximity. But United Kingdom companies, when choosing where to site their plants —whether, say, in Europe or the Pacific Rim—go for the site that promises the fastest economic growth, wherever it may be.
In considering Europe, labour costs are high, as are the burdens that flow from employment and social security legislation. Our industry and commerce look for lower production costs, especially labour costs. They also look for technological skills, freedom from regulation and red tape and a culture which encourages financial personal responsibility and the work ethic. It is the case that emerging market economies often fill the bill very much better than the Union.
In 1993, emerging markets attracted £62 billion, almost one-third of the total equity cross-border investment flow; whereas the Union attracted £23 billion, or 23 per cent. In world markets emerging markets now rank third after the United States and Japan; and in spite of the greater risks and the reduced liquidity of these markets, there is a widely held conviction that emerging markets will continue to grow. Some estimate that by 2010 no less than two-thirds of global output will come from these countries; whereas in the Union, as we have heard this afternoon, unemployment and fraud are unchecked. I have to add that the Union is losing market share not only in overall world trade but even, and particularly, in high-technology goods. Our Government are right to call upon the Union to reduce direct and indirect labour costs and to improve competitiveness.
If we look at the position in Britain in this area, our direct and portfolio investment overseas is now so considerable that it may well in the future influence both the character and the composition of our economy. United Kingdom direct investment overseas has a market value of £300 million. That is direct investment. When one adds the overseas portfolio investment, the total approaches £700 billion. That is equivalent to the total valuation of UK companies quoted on the Stock Exchange.
It began to happen in the mid-1980s. From that time onwards, the flow of inward and outward foreign direct investments has become so pronounced that it must raise the question of whether government and their departments adequately reflect the new balance which our industry and commerce are introducing in our whole relationship with the global economy. Europe must remain crucially important to us. But one must ask whether our present emphasis on European affairs is causing us to play down this important relationship with the rest of the world. Does it accurately reflect this country's role as a leading global trader?

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Perhaps I may give one final, and slightly different, example. Mr. Jamieson, the deputy City editor of the Sunday Telegraph, has suggested that, because of all that is happening, the remit of the DTI should be expanded to ensure that the invisible sector of the economy is properly represented by government. In fact, he suggests that it should become the Department of Industry, Trade and Investment. Certainly, the balance of our economy is changing. Inward and outward foreign direct investment flows are becoming increasingly important. Maybe vis-à-vis Europe our role should be not only to be a loyal and active member of the Union but to be a bridge between the Union and the rest of the world.
That brings me back to the point at which I began. Britain can only influence the future of the Union if it is clear about what the structure should be to achieve ever closer union and about the speed at which it should be developed. That is an issue that is likely to be high on the agenda at the inter-governmental conference in 1996.
9.14 p.m.
Earl Attlee: My Lords, perhaps I should start by declaring my interest. I am a serving officer in the REME TA, as is my wife who commands a REME recovery company. I listened with interest to the speech of the noble Baroness, Lady Park, and I shall study Hansard carefully. I am not qualified to say that she is right, but I hope that she is wrong.
I echo the concerns of the noble Lord, Lord Vivian, particularly the requirement for higher level training FTXs at divisional level, and his comments regarding the need for training specific to UN operations. Having been protected by the British battalion group in Bosnia, I can confirm that our forces operate to the very highest standards. While protected by BRITBAT, I was never in fear for my own safety. I wish that I could say that for some of the other forces. I do not advise any British NGO to operate in Bosnia without the protection of BRITBAT in theatre.
The plans and legislation of the 1950s allowed for either total mobilisation of the TA for general war or very limited use of the TA. In other words, it was all or nothing. The requirement now is for much smaller numbers to be able to be called up at any one time. It is possible to call up individuals of the TA where their specific skills are required, but the procedure is complex. It is easier to remove a regular soldier with the required skills, if available, rather than get bogged down in staff work trying to use the TA. As a result, the MoD does not receive all the benefit that it could from the TA, and the regular units suffer from their soldiers or even sub-units being poached for special duties. That was referred to by the noble Lord, Lord Vivian. The TA suffers from the loss of opportunities and the perception that it is not effective. The Government are well aware of the difficulties and have in preparation an entirely new reserve forces Bill. They have consulted widely and the TA looks forward to the new legislation.
During the SDE debate last year, the Minister, the noble Viscount, Lord Cranborne, on 28th July (Official Report, col. 1364), confirmed the Government's
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intention to introduce legislation that would take effect in 1995. All members of the reserve forces will be very disappointed when they hear that there was no mention of any such Bill in the gracious Speech. I accept that there is great pressure on the parliamentary timetable. But can the Minister assure me that, if the Government's business managers were to offer him a slot next week for the Bill, he would have the Bill ready to present to Parliament? I look forward to hearing his answer.
The restructuring of the TA is to be announced shortly. It is understood that the size of the TA will be around 59,000. In other words, it will be a reserve of approximately 50 per cent. of the size of the regular Army. That is very welcome. There are some difficult decisions to be made against the background of a policy that all TA infantry battalions will be the same. Unfortunately, it is a levelling down exercise as some TA battalions had an Allied Rapid Reaction Corps role and had heavy support weapons, while others were purely for home defence. Now none will have its own support weapons. The TA parachute battalions are arguing the case to retain their own support weapons as their role is so specialised. They claim that a standard support weapons company could not effectively be parachute trained. I am inclined to believe that.
The London Regiment has only recently been formed from four London-based regiments. It has been very successful at adapting to its new order of battle. The proposal is that all TA infantry battalions should have only three rifle companies. Your Lordships will be well aware of the special significance of a regiment based on the capital but may not be aware of how damaging downsizing this regiment to three companies would be. Can the Minister assure the House that he will give very careful consideration before allowing this so recently formed regiment to be modified again and instead give a longer period of stability?
I also understand that there is a review in progress concerning the decorations available for reserve officers. I remind your Lordships that I do have an interest and I already have my TEM—Territorial Efficiency Medal—for my non-commissioned service. But the TEM is a medal and not a decoration and so post-nominals are not available. I am therefore envious of the many noble Lords who already have their TD. The current rules provide me and many other officers with a great deal of motivation to continue serving to the best of our ability and to earn our TD. As I understand it, the proposal is to downgrade the current reserve decorations, the RD, the TD and the AE, to one tri-service medal without post-nominals.
Is the Minister aware that any such scheme will cause serious damage to the morale of the TA? Is he further aware that there is already a shortage of experienced TA officers and that such a scheme would only make matters worse? I have served many years in the ranks and for the past few years I have been commissioned but I have never detected any discontent regarding the entitlement rules for the TEM or the TD. The Minister would be well advised to leave the current arrangements as they are.

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In conclusion, I am disappointed that there is to be no reserve forces Bill, but I look forward to taking part in the business of the House during the next 12 months. I shall now sit down and enjoy listening to the noble Lord, Lord Beloff.
9.22 p.m.
Lord Beloff: My Lords, one can hardly open a newspaper nowadays without seeing an advertisement from the Nolan Commission on standards in public life inviting one to suggest evidence. At this late hour, when people's ears have been assailed from various quarters by good and bad news and views, I thought that I might as well use the occasion to give my evidence, as it were, in public. It seems to me that if one looked for a measure of standards in public life the most important would be truthfulness. Everything pales beside the necessity for those in public life to tell the truth as they see it. By this standard the Nolan Commission will have a task well outside the petty peccadilloes which led to its being set up.
It is my view—I do not think noble Lords who have heard me before will be surprised—that the two principal political parties in this country and the successive governments they have manned for the past quarter of a century have engaged, I am not sure whether wholly consciously, in misleading the British electorate—Parliament and, through Parliament, the electorate—as to the nature of what has been going on in continental Europe. They have constantly reiterated, ever since they brought this country into what we used to call the Common Market, the fact that there is a British view as to the way in which Europe might be organised in peace both politically and economically; that this view was prevailing, and would prevail; and that we could dismiss from our minds any alternative.
So we were told from the very beginning that the common agricultural policy, which was regarded as inimical to our interests and those of the third world, would undoubtedly be revised. Twenty-five years on the common agricultural policy is still with us, still distorts the patterns of production and consumption of foodstuffs and, as we have been reminded, still gives unparalleled opportunities for fraud. We have been told equally that there was of course some democratic deficit and that there was too little popular parliamentary control but that all of that would be put right by the European Parliament when we agreed to direct elections to that assembly.
I should not like to upset my noble friend Lady Rawlings, whose maiden speech—as indeed in the case of the noble Lord, Lord Blaker—we listened to with rapt attention and admiration, but I must point out that she is making a delicate transition from a simulacrum of a parliament to a real parliament and I hope that she comes to enjoy her new role.
From time to time one thinks about the European Parliament. The report of the Court of Auditors has been referred to several times in the course of this debate. It was actually presented to the European Parliament by its author. Those of us who saw the clip on television news will have realised that practically no one was
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there. When we debated the very important and parallel report of our own House of Lords committee on the same subject 70 Peers took part, and that is quite a high proportion for a Monday at the tail end of a Session. I believe that there were fewer than 70 Members of the European Parliament present at what we were told was the body that was going to take charge of this important lacuna in the provisions of the Community.
When I think of the European Parliament, it reminds me chiefly of that body of people who occupied our thoughts a great deal during the passage of the Criminal Justice and Public Order Bill in the last Session. I believe that they are known as New Age travellers. There they are, this shabby caravan, going from Brussels to Luxembourg, from Luxembourg to Strasbourg, from Strasbourg back to Luxembourg, back to Brussels, and of course at the same time receiving sustenance from the public purse, I hasten to say, on a more lavish scale than the DSS provides for the unfortunate New Age travellers. Why do they do that? We all know why, just as we know why totally unnecessary and lavish new buildings are being put up for them. It is part of the continual bargains which the Government of France extracts from the European communities.
My complaint about Her Majesty's Government, and indeed about their predecessors under the noble Lords, Lord Wilson and Lord Callaghan, is that they are not very good at extracting what Britain requires because they have not learnt the art of diplomacy in this new environment. But that is perhaps a secondary matter.
Much more important is the consistent denial that what has been happening has been the absorption of the United Kingdom as the junior province in a federal government. I know that the Minister and I do not agree on this subject. If the noble Baroness, Lady Chalker, had had the advantage of attending the classes on federalism that I taught for many years in the University of Oxford in company with the late authority on that subject, Sir Kenneth Wheare, she would know that there is only one definition of "federalism", and it is a definition which the European communities in part fulfilled from the very beginning and which they intend to fulfil totally after the intergovernmental conference in 1996.
It is not that anything has been concealed from Her Majesty's Government. Other politicians from other countries in the Community are totally open about their aims. Indeed, some of them are open in English. After all, Mr. Flynn, the Commissioner who deals with social matters and the Social Chapter, is an Irishman and speaks quite passable English. He has repeatedly said in public and aloud that it does not matter whether Britain has an opt-out because there is no regulation which the Commission may wish to pass—quite apart from the Social Chapter—for which it could not find some article in the treaties to give it those powers, and it has every intention of proceeding along those lines.
Even more important, since, after all, although it gets a good deal out of the communities, Ireland does not put much into them—that is natural enough because it is a small and poor country which is without any government at the moment—is the position of Germany. It has been translated into English—my German is not all that good—but I do not know whether Ministers have

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read and digested the paper that was presented to Chancellor Kohl's party by its group on the future of Europe, which I gather is being brought over to London this week by one of Chancellor Kohl's principal assistants, Herr Lamers. That paper makes it quite clear that the intention is to remove those elements which still prevent the European communities from being a full federation. Having been re-elected Chancellor, albeit by one vote, Chancellor Kohl now looks like being in power for some time and he has said that the purpose of his becoming Chancellor again is to complete the process of European integration, by which he means the creation of a United States of Europe.
So, one asks oneself: what is it about our Ministers that make them convinced that they are bringing the Union round to their point of view when everyone else who speaks on these matters takes a different view? Surely it cannot be that those of us who know that all this is going on are unique. There is something within Whitehall which seems to obstruct the communication of information from outside, particularly from foreigners. Having heard the speeches of the noble Lords, Lord Bridges and Lord Wright of Richmond, we know where the obstacle lies. The Foreign Office has been taken over by the advocates of appeasement to a much greater extent than in the 1930s. By "appeasement" I refer to the view that Britain has no possibility of exerting an independent role in the world; that its role will be confined to being a good little boy in Europe, and the wider issues of the economy, upon which I shall not touch, but which the noble Lord, Lord Butterworth—
Lord Bridges: My Lords, I thank the noble Lord for giving way. I find his use of the word "appeasement" a little excessive, particularly in the context in which he used it. If we have made errors of judgment, we have done so honestly. We are not appeasers.
Lord Wright of Richmond: My Lords, I should like to associate myself with the remarks of my noble friend Lord Bridges.
Lord Beloff: I do not regard the word "appeasement" as pejorative.
Lord Wright of Richmond: I do.
Lord Beloff: I am sorry. In that case, there is another difference of opinion about the English language in the House which we shall have to argue on another occasion. "Appeasement" was used in the 1920s by those who wished to achieve a peaceful settlement at the time of Locarno, for instance. It is an honourable word. It means that you think that you cannot resist some external force which is too great and therefore you recommend getting the best deal possible.
Baroness Seear: My Lords, does the noble Lord agree that the word "appeasement", whatever it may have meant in the 1920s, acquired an unfavourable interpretation in 1939?
Lord Beloff: My Lords, that may well be true, but I do not believe that that affects my argument. My argument is, and it has not been denied by either of the
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noble Lords, that on the whole the Foreign Office is in favour of Britain becoming a part of a united states of Europe and therefore no obstacle is placed in the way of foreigners who are trying to prove to us that that is what will happen.
Baroness Chalker of Wallasey: My Lords, I am most grateful to my noble friend for giving way. Let me say to him here and now—I hope that I do not have to repeat this in a future debate—that policy in the Foreign Office is made by the Foreign Secretary and his Ministers. There is no question of appeasement; there is no question of a united states of Europe; there is a will by the British Government to work with our partners in Europe; to correct what is wrong in the European Union—my noble friend will know that I have never shrunk from saying that—and to try to pursue a European policy that will protect Europe in the future, including bringing membership to the countries of Eastern Europe in a way that we have been unable to do before. That has nothing to do with appeasement; it has everything to do with good common sense and being good Europeans.
Lord Beloff: My Lords, my noble friend has once again given her view that Britain will win this argument. My point is that the evidence from across the Channel is that Britain is not winning the argument. Indeed, the fact that we are told that there must be deepening as well as widening—a favourite phrase in Brussels—proves my point. But I do not wish to prolong the debate or this speech. I wish only to say in conclusion that it may all be academic. I do not think that the European Union will survive.
I know that a few years ago people who said that the Soviet Union would not survive would have been laughed at. There is plenty of evidence in other countries, in France, for instance, that the disadvantages of belonging to a tightly knit federation, ultimately with a single currency and therefore control from a single financial centre, are being looked at again—I believe that they are being looked at again in Italy, for instance, by its new foreign minister—and therefore, although I shall not be here to see my prophecy come true (I do not believe that this will happen before the end of the century, and at my age I do not expect to see it), those noble Lords who are younger than myself will see that, on this occasion at any rate, I was right and the majority of your Lordships were wrong. They may well repeat the well-known words of Lord Melbourne with which I conclude:
"What all the wise men promised has not happened, and what all the d.…d fools said would happen has come to pass".
Baroness Seear: My Lords, I would not call the noble Lord a damned fool—not normally anyway.
9.40 p.m.
Lord Ashbourne: My Lords, it is getting late and if I am not to weary your Lordships I must get into top gear as quickly as possible.
I was delighted to read that the Government,
"attach the highest importance to national security".

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I find it difficult to reconcile that bland statement with the significant rundown of our Armed Forces during the past 12 to 14 years. It is a bland statement, which I welcome, and it is good to see it in black and white.
I am saddened that the gracious Speech contains nothing about plans to replace the present Royal yacht, which is to be decommissioned in 1997. There are not many things that we, the British, do better than anyone else, but one thing that we do do better is ceremonial events and related affairs. Your Lordships will be able to form your own judgment because only yesterday we had the opportunity to witness the State Opening of Parliament. Frankly, we are very good at such things.
In my opinion, the Royal yacht represents an extension of that ceremonial expertise. She sails to a foreign port, often with the Monarch or members of the Royal Family on board. Members of the Royal Marine Band are landed and they put on their pith helmets. They march up and down and play "Rule Britannia" and other martial music. The flag is lowered and the bugler plays. Visitors could be excused for believing that the British Empire had not disappeared.
Those are golden moments and people take out their handkerchiefs to wipe away the tears as they witness such events. It is a terrible shame to propose the decommissioning of the Royal yacht without making an attempt to replace her. I read in the press a suggestion that a commercial buyer who is getting on in years is to make a bid for the yacht and that the Government may lease her back. That is not a real answer to a real problem.
The yacht has no defence capability so why is she funded out of the defence budget? It is true that she has a Royal Navy crew and is currently commanded by a rear-admiral. However, only yesterday I heard that the present rear-admiral will be relieved by a commodore. That is the most remarkable example of spoiling the ship for a ha'p'orth of tar. All that can possibly be saved is the difference between the salary of a rear-admiral and that of a commodore. I am no expert in naval salaries, but I believe that that could be no more than £20,000 at the outside. It is pin money and we are talking about tarnishing a national asset for £20,000. Your Lordships will judge whether that is a sensible and balanced decision.
I have only two constructive suggestions for the Government to consider. First, they should instruct the Ministry of Defence to carry out a feasibility study to discover whether it would be better to refit the present yacht, with her beautiful lines but rusty bottom, or to build a new ship. That would be a simple operation to carry out. Depending on the result, the Government should have designed and built a new ship to carry out the dual function of royal duties and export promotion. Your Lordships will be aware that within the past 18 months the Royal yacht has undertaken a remarkable tour to Malaysia and has built up British exports. If that were the case, the Royal yacht could he funded by the DTI and that would overcome one of the financial problems.
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Alternatively, the Government might like to consider having a ship built for royal duties and disaster relief, in which case it could be funded by the Foreign Office. I see that the Minister is taking that on the chin very calmly. I thought there might have been a slight reaction to that.
In all seriousness, I ask the Government to put on their most imaginative hats and to consider ways in which to replace that great national asset. We must not let it slip through our fingers because we cannot find a few million pounds out of a particular pot. Indeed, it is not even the right pot from which we are trying to get that money. Therefore, the situation seems to me to be ripe for change.
9.45 p.m.
Baroness Seear: My Lords, it gives me great pleasure to congratulate the two maiden speakers. The noble Baroness, Lady Rawlings, reminded us—perhaps instructed us, because we are not all aware of it—about how profound, magnificent and old are the cultural traditions of the countries of Europe. That was the case long before there was a European Union and that provides an extremely good foundation on which to build the present Union and the Union of the future.
We are grateful also to the noble Lord, Lord Blaker, for his extremely well-informed and professional discussion on the problems of Hong Kong. It is always one of the great advantages of your Lordships' House that we have people of such knowledge who are able to keep us up to date and to inform us about those problems, which are of the very greatest importance.
The noble Lord gives me the opportunity to ask the Government whether, when they are considering Hong Kong, they will think again about the issue of the Hong Kong Indians, whose case was fought so valiantly by my late colleague Lord Bonham-Carter. Surely it is possible for such a small number of people, who would add so much to this country, to be considered for residence in the United Kingdom. As we have said so often, we are not talking about people who would be a great drain on the social security budget. I suspect that by the time a great many of those Hong Kong Indians had been here for five years, they would be buying up a great many of those Members of your Lordships' House who were up for sale. I beg the noble Baroness not to turn down that request. In the gracious Speech and in the speech of the noble Baroness, Lady Chalker, there were a number of matters with which we on these Benches can very easily agree. For example, we agree that the extension or the expansion of the European Union is of the greatest importance and that it should take place as soon as possible. Some noble Lords have suggested today that the European Union has a number of serious disadvantages. And yet such hardy people as the Finns, the Swedes and the Austrians are extremely anxious to join that "dubious" organisation.
We know too that others in greater need are also very anxious to join. People may be cynical as to the reasons why they wish to join, but surely the noble Baroness is right to say that the extension and expansion of the Union and admission into it, or at least agreements as a

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half-way stage for those countries, are of the greatest importance. Of course, it means that we must play fair with them according to the rules of the Union. It means that we must look very carefully at the conditions for trade and what will be the effect on the Union of the admission of those countries, which have low labour costs. That is a price which we must learn to pay. So far, so good; we can go along with that.
We very much support the attitude taken by the noble Baroness and the Government with regard to Bosnia in regretting the attitude now being adopted by the United States. Probably, somewhat reluctantly, President Clinton is being pushed by the Republicans whom, in other matters, I suspect that the noble Baroness would be inclined to support. I see that she shakes her head and that is very reassuring.
I had the good fortune—though, perhaps, I should say, the valuable experience—of visiting Bosnia earlier this year. I visited an NGO working in that country. It was crystal clear to me that, if we were seen to be taking sides and if we were seen to be supporting any of the warring groups militarily, it would be the end of our humanitarian contribution. The ease with which the NGO that I was associated with was able to pass the roadblocks and was let through by the troops stationed there was evidence that they understood that humanitarian aid was non-party and that it did not support any of the warring factions. The minute that that ceased to be true, that would be the end of humanitarian aid. While so many people the world over are critical of what has and what has not been done in Europe in relation to Bosnia, we must keep repeating that there are thousands of people in that country today who are alive but who would be dead if it had not been for that humanitarian aid.
So far so good; we can go along with the noble Baroness. We can also go along very much with the work that she has done and continues to do on overseas development. Many of us on this side of the House would like to think that there could be more. I have no doubt that the noble Baroness also wishes that there could be more. Similarly, I have no doubt that some of the scenes that the noble Baroness has to witness must be heartbreaking. For that, indeed, we thank her. We are grateful that she is able to continue with her work in that way.
Because of the interest that I have in such matters, I am particularly grateful for the Minister's recognition of how important family planning issues are in developing countries. I am also grateful for her recognition and her repeated support for women's issues in those countries. There can be little doubt that the real development of developing countries depends more than anything else on how the women in those countries are able to get education and thereby gain economic independence, thus enabling them to make a full contribution to the development of both the economic and the social life of such countries as they move from undeveloped, to developing, to developed. I know that the Minister gives a great deal of support, which she is able and free to do, to such work.
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So far so good. However, this Government are often criticised for being short term. I feel that the gracious Speech is yet another example of short-termism. Here I very much reflect the speech made by the noble Lord, Lord Cledwyn. We talk about the 20th century as having been a bloody, dangerous and, in many ways, a vicious century. But I greatly fear for the 21st century. I shall not be here—at least, not for much of it—and neither will many noble Lords, though there are some who might be. The perils ahead in the 21st century require thinking about and planning for now. What are those perils? They are to be found within the continent of Europe and in the eastern countries that lie beyond Europe.
I believe that the noble and learned Lord, Lord Howe, spoke about the Ukraine. The perils in that area are just one example of the dangers that exist throughout the Middle East and Western Asia, let alone Eastern Asia. I had the opportunity to make a brief visit to Nagorno-Karabakh where, I must say, the noble Baroness, Lady Cox, is regarded as second only to the Virgin Mary. My visit was very short and very insignificant. However, it was blindingly obvious to me that the whole area is a tinderbox. All over those countries there are sources of potential conflict. There are a great many loose cannon in those countries where government is reduced to a minimum, where anarchy is just beneath the surface and where individuals no longer belong anywhere. One prisoner of war, a 19 year-old Russian prisoner that we visited in a prisoner of war camp, had been fighting for the Azerbaijani Army. He said of course that he had not really meant to fight against the Karabakh but that he had been drunk and he had then been recruited and when he came to he found he was a member of the Azerbaijan forces. I understand that that is a pretty standard story. He had the good sense to have fought for only one day and then was taken prisoner and was not doing too badly in the prisoner of war camp. But that is just one case of the rootlessness of people who do not belong anywhere. There are these rootless individuals and an alarming amount of ammunition which is still floating about in those countries in the hands of people who would be only too glad in many cases to sell it for a small amount of money because of the difficulties in which they find themselves.
It is a tinder-box, but what are we doing to ensure that that tinder-box does not burst into flames? When I returned I asked the noble Baroness in a Question in your Lordships' House why it was that in Armenia, at the centre of this tinder-box, with Turkey on one side and Iran and the Ukraine nearby, we do not even have a part-time honorary consul. The noble Baroness told me that Moscow looked after the matter. That is hardly sufficient if one wants to keep one's ear to the ground and to find out what is going on in these countries and to be forewarned and forearmed before it is too late. What are we to do?
So much for Europe and Western Asia; we also have the global problems. A noble Lord talked of some aspects of the problems with regard to development and of the opportunities that exist, because there are opportunities as well as problems in the development of

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the global economy. However, the world population will probably double by the year 2030 and 95 per cent. of that will occur in developing countries. The gap between the rich and the poor will become so great that there cannot possibly be acceptance of the status quo. That is again a potential volcano with which we have to be prepared to deal but are we really thinking about how we are to cope with this?
Other noble Lords today have talked about the importance of changes in the UN. The UN has tasks piled upon it which it has by no means the strength or the resources to carry but if we are really to face these problems we must have some sort of organisation like the UN which can begin to deal with these problems and anticipate them. There have been a number of proposals put forward in your Lordships' House today. I do not know how many of them are practical or how far we can go but one thing is absolutely certain: the UN at present has neither the organisation nor the resources to begin to deal with the problems that we can see, not looming ahead but all too close to us and which will be certain to make themselves apparent in the 21st century.
Next year is the 50th anniversary of the UN. What kind of reorganisation does it need? What kind of additional powers does it need? How valid is the concept of a peacekeeping force that can be put into being when it is needed? At the moment it is quite plain that the UN is overloaded and does not have the resources to begin to deal with the present problems let alone the problems of the future. I shall not go on as I have talked for too long. However, the matters to which I have referred are the important problems, not the relatively small matters, important though they are, in the gracious Speech. Let us take a good hard look at the frightening problems of the 20th century and get a strategy for dealing with them.
9.59 p.m.
Lord Judd: My Lords, much of this debate has been a useful reflective occasion containing a good deal of wisdom, experience, expertise and indeed, in the remarks of the noble Lord, Lord Beloff, prophecies worthy of an Old Testament prophet. I look forward to going over it all again in Hansard as there is valuable comment to digest, but now I must congratulate the noble Lord, Lord Blaker, and the noble Baroness, Lady Rawlings, on their sparkling maiden speeches. On the evidence of their performance today we shall all look forward to their contributions in the future, even if occasionally we do not altogether agree with their analysis or conclusions.
I must also endorse the observations made by my noble friend Lord Cledwyn in his formidable speech. We all admire the commitment and personal integrity of the noble Baroness, Lady Chalker. If only the Government as a whole listened to her and reflected her standards of compassion, insight and concern, Britain would today be a brighter, happier and more honest place. But sadly the accumulated evidence all too clearly demonstrates that they do not.
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Perhaps I may start with a few words on the Crown Agents. In examining the proposed new legislation our sole concerns will be whether the proposed changes enhance or damage the work of the Crown Agents and whether they will better serve the interests and needs of the United Kingdom and the international institutions and overseas nations with which we seek to co-operate. The Government assure us that a wide cross-section of relevant organisations will be included in the new foundation. We shall examine very carefully exactly what that means. What we will not countenance is the transfer of yet another well-tried and proven public service to some less accountable quango packed with Government supporters.
Four years ago this month the Berlin wall came down and people on both sides of the Iron Curtain rejoiced at the prospect of a more secure and stable world. My noble friend Lady Blackstone spoke of the grounds for hope in South Africa, the Middle East, Cambodia and Haiti. I strongly endorse that positive analysis of what can be when the will and leadership to make it happen exist. But still, by contrast, as my noble friend emphasised, for too many millions the dream of 1989, if for them it ever was a dream, has faded with the spread of regional and intra-state conflicts across the world.
During my time as director of Oxfam I became mesmerised by the degree to which conflict diverted us from our commitment to long-term development. When I completed my service less than three years ago more than 50 per cent. of our work worldwide was conflict related. In Africa it was more than 70 per cent. The human and economic cost is sickening. In the Second World War some 50 per cent. of the war-related casualties were civilian; today, the figure is probably in excess of 90 per cent.
The non-governmental think-tank, Saferworld, with which I am glad to work professionally, has today launched a report entitled The True Cost of Conflict. Against the recent background of Rwanda and Somalia, where in orchestrated campaigns of violence up to 1 million men, women and children have been butchered, this report covers seven other case studies.
In former Yugoslavia it records that 200,000 have died and that 20,000 Moslem women have been raped. Over 500,000 refugees have fled to countries in the European Union. The cost of UNPROFOR, including the deployment of 31,000 troops, has reached 1 billion US dollars.
In East Timor 210,000 people of a population of 650,000 have died since the Indonesian invasion in 1975. Child mortality is the world's second highest. Following the invasion, virtually no foreign investment has come to East Timor.
Between 1989 and 1991 Iraq's gross domestic product fell from 66 billion US dollars to a mere 245 million US dollars. The costs of the Gulf War to Saudi Arabia have been at least 62 billion US dollars.
In Mozambique between 10,000 and 15,000 civilians have been killed by landmines. Some 70 per cent. of the schools have been destroyed and two fifths of the population are illiterate. The war has cost Mozambique 15 billion US dollars—four times its 1988 gross

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domestic product. Between 1981 and 1991 the world had to mobilise 6 billion US dollars of foreign aid for that war-torn country.
In Sudan, since 1983 500,000 people, mostly civilians, have died. Up to 1 million have been wounded and 6 million have been displaced. In 1992 the Sudanese Government spent more than 1 billion US dollars on arms. All infrastructural development has been halted and much has been destroyed. US companies have lost over 1 billion US dollars worth of investment. In Kashmir 3,000 businesses and shops had been destroyed by 1991. Tourism dropped from 700,000 visitors in 1988 to 10,000 in 1992. In Peru, 600,000 people have been displaced. Sendero Luminoso guerrillas have caused some 22 billion US dollars worth of damage. And so the grim story continues across the globe—Angola, Liberia, Afghanistan, the former Soviet Union, and the rest. That is why my noble friend Lady Blackstone was so right to emphasise what a genuine commitment to pre-emptive diplomacy involves.
As the reform of the United Nations is debated, if we in the United Kingdom are to justify our continued place as permanent members of the Security Council we must be in the vanguard of putting pre-emptive diplomacy and conflict resolution to the top of our foreign policy priorities.
The noble Baroness, Lady Chalker, referred to the UN as being no more than the sum total of the commitment of its member states. She is right. But that is why it is to our eternal discredit that as permanent members of the Security Council we were party to the decision to reduce the UN presence in Rwanda at the very time when the Secretary General and others were calling for it to be increased. Many thousands of dead and bereaved today might have been saved had we supported in time a greater presence. If we are serious about a positive as distinct from a reactive foreign policy, it is now that we should have the dangers of renewed conflict in Rwanda, and of new conflict in Burundi, Kenya, Togo, Nigeria and Zaire high on our agenda. The cost of failing to act in time may well otherwise once more prove formidably and bloodily expensive.
Before I leave that theme, I must raise the matter of Gambia. With all the Government's emphasis on democracy, human rights and good governance, exactly what are they doing directly, as well as with others, to restore democracy there? If the international community cannot deal effectively with a little group of misguided military adventurers in that small country, I shall begin to despair for the future of humanity. No responsible discussion of security can ignore the arms trade. Each year the world spends 250 times more on the arms which fuel conflict than on peacekeeping. It is surely a crude paradox that almost 90 per cent. of the arms sold to the third world are sold by the five permanent members of the Security Council. It is surely ironic that the cost to the US alone of Operation Restore Hope in Somalia, which involved rounding up weapons, roughly equalled the value of the arms sold to the Siad Barre regime during the 1980s; and it is bizarre that during the Gulf War allied troops found themselves facing weapons supplied by their own side.
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The time has certainly come for the international community to take urgent steps to regulate the arms trade. I suggest three priorities: first, to implement the common guidelines which have been agreed and adopted by member states of the European Union and the CSCE so that the arms exports to countries abusing human rights, or which undermine regional security, are effectively restricted; secondly, to extend the 1991 UN register of arms to include small arms so that trade in that most widely used category of arms will be scrutinised under the glare of an international spotlight—I believe that to be an absolute pre-requisite for effective control; and, thirdly, to take urgent action to deal decisively with the sale, stockpiling and use of increasingly sinister anti-personnel mines with all their truly terrible long-term, as well as short-term, human, agricultural and economic consequences.
In the meantime, notwithstanding the well-intentioned professions by the noble Baroness, Lady Chalker, the Government must respond more convincingly to the growing and deep anxiety so well expressed by my noble friend Lord Desai and others in this debate about the apparent correlation between the deployment of substantial amounts of our aid programme and lucrative arms deals. It is too big a coincidence to swallow. Pergau has been one such story; Indonesia is sadly at least as significant. Thailand, Nigeria and Oman are other disturbing examples. All that, at a time when bilateral aid to poverty-stricken parts of Africa is scheduled to be cut severely over the next three years.
I understand—and the Minister will certainly correct me if I am wrong—that the Ministry of Defence Form 608 (Export Licence and Arms Working Party Applications) states:
"It is government policy that aid may not be used either for the purchase of military equipment or"—
and this is the significant part—
"to promote such purchase".
The Minister for Overseas Development will have the full support of the House in bringing home to her colleagues that we detect an alarming gap between stated policy and practice. But no doubt the Scott inquiry will have much more to tell us about all that.
No one wants to spend more than is necessary on defence—certainly not at the expense of civil, industrial and technological development, economic and social infrastructure, education, health, housing, environmental care, and the rest, which together make a quality of society worth defending. What, above all, is therefore essential is to define the perceived threats, the task, the purpose. If in the post Cold War era uncertainty, volatility, increasingly sophisticated international terrorism—perhaps nuclear, chemical and biological—are the dangers, then those are what our defence system must be geared to meet. If what is required is an ability to contribute effectively to international peacekeeping and international humanitarian operations like those we have seen so courageously, sensitively and committedly undertaken in recent years, then we should gear ourselves convincingly to just that. If analysis demonstrates the indispensability of United Nations standby forces or of a standing UN rapid deployment

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force backed by first-class UN command structures and intelligence, then that should be a central feature of our defence policy.
In that context, perhaps when the Minister winds up he will tell us more of what is to be discussed with the French in Chartres, I believe tomorrow. What of the reported proposals for a joint Anglo-French command to co-ordinate military operations outside the NATO area? What of the ideas for joint patrols and targeting by nuclear armed submarines and for an African standing force? How does all that relate to our lead responsibility as permanent members of the UN Security Council, as well as to our membership of NATO?
What would be a total waste of taxpayers' money would be to spend vast sums on defence arrangements that were unsuited or inadequate to meet the essential task. In that respect, it has to be said that it is still immensely difficult to see clearly exactly what is the Government's view of the challenges they are endeavouring to meet. It is therefore virtually impossible to establish whether what is being done is right or adequate to meet the Government's own objectives, if they have them. In the absence of this convincing sense of strategic purpose, anxieties are inevitably acute lest we have a piecemeal Treasury, as distinct from defence-led policy—one, incidentally, that naively separates out front line and support services when recent experience establishes the absolute imperative for their integration.
Yet again in this debate I found the thoughts of my noble friend Lord Kennet particularly stimulating. It would be lamentable if, in the post Cold War era, we allowed east and west once more to drift apart. Surely it is vital to bring the former Warsaw Pact countries into NATO as soon as their military and political developments make that possible. How soon do the Government believe that Poland, Hungary, Slovakia and the Czech Republic can be fully integrated? Of course Partnership for Peace is a start; but it must never become an end in itself. It neither provides security guarantees nor makes provision for even associate membership of NATO. It sits uneasily beside the commitment in the gracious Speech to an enlarged European Union, eventually encompassing countries of central Europe.
International security in an unpredictable world demands disarmament. With whole economies and numerous jobs dependent on the arms industry, a serious commitment to disarmament requires a serious commitment to substitution. The US and the European Union with its KONVER programme have made a start. Surely we in the United Kingdom should follow suit, fully using the opportunities that are presented by KONVER to facilitate valuable defence technologies "spinning into", as the term goes, the civilian sector.
Meanwhile, as the noble Lord, Lord Mayhew, pointed out, it is good to see the commitment in the gracious Speech to the extension of the non-proliferation treaty and the nuclear test ban treaty. But, as the noble Lord argued, "do as we do" rather than "do as we say" will be an important leadership role for the United Kingdom.
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What therefore remains deeply disturbing is that the Government, while having come down from the ludicrous figure of 500 warheads, still stick to a maximum 384 warheads for Trident, as against the present total of 192. What possible post-war rationale can there be for 96 warheads per submarine with Trident as compared with 48 with Polaris during the Cold War? How does such a commitment help with the non-proliferation treaty and beyond? Indeed, does it not run directly counter to Article 6 of the non-proliferation treaty, which requires signatories to reduce their nuclear arsenals?
By the same token—as has been raised in this debate—I hope that the Minister will be able to reassure us that no weakening of commitment is indicated by the absence from the gracious Speech of any mention of ratification of the chemical weapons convention. For me, the most important message from today's debate has been the concern with pre-emptive diplomacy and conflict resolution.
Let us never forget the underlying causes of conflict. It is all too easy to be simplistic; to characterise, for example, Rwanda as just another ethnic conflict. Rwanda was one of the poorest countries in the world; one of the most densely populated in Africa; one with an enormous debt burden; one whose economy had largely depended on a single commodity subject to wild fluctuations on the world market. All of those were major factors in the crisis. They were factors to which we in the north contributed. If we continue to live in a world where the rich grow richer and the poor grow poorer, where the result of accumulated unpayable debt is to crush the poor still further, we must expect to live in a world where conflict, coupled with international terrorism, increases, making us all poorer and more vulnerable in the end.
It is high time that we redrafted the role of the Security Council to take on board the economic, social and cultural dimensions of security. It is essential to make the Bretton Woods institutions more accountable for their role in world affairs; to bring home to them their responsibility for social justice, peace and security.
At home, the really bitter part of the Pergau saga was how on earth our all-too-limited aid funds—at an all time low as a percentage of gross national product—could be diverted for such a questionable project in relatively prosperous Malaysia when the demands of abject poverty remain so great. Nothing could be more appropriate than to see the £60 million already spent on Pergau put back into the aid programme to make good the projected £60 million cuts in aid to Africa over the next three years.
10.19 p.m.
The Parliamentary Under-Secretary of State, Ministry of Defence (Lord Henley): My Lords, I would like to join other speakers in congratulating both my noble friends, my noble friend Lord Blaker and my noble friend Lady Rawlings, on their quite excellent maiden speeches. My noble friend Lord Blaker spoke with great expertise and feeling on Hong Kong and China—matters about which he knows a great deal. I have to say to my noble friend that I think he has an

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advantage on both myself and my noble friend Lady Chalker in that he served in both the Ministry of Defence and the Foreign Office. We have not had such an advantage. Perhaps on later occasions we might persuade him both to open and close a debate such as this!
My noble friend Lady Rawlings spoke with the expertise of a former Member of the European Parliament and made what I am sure we all agree was a wonderful speech in a very uncontroversial manner on what was surely a very uncontroversial subject. I should just like to question one part of her uncontroversial speech. She referred to the cultural links which have existed among all parts of Europe for hundreds of years and mentioned the Norman invasion of 1066. I imagine that to some people at the time that was not the most uncontroversial of actions that might have taken place.
In opening the debate, my noble friend Lady Chalker quite rightly stressed the wide-ranging nature of the debate and the impossibility of making a comprehensive review of all foreign policy matters. One might simply put it in the terms that Nancy Mitford's fictional Uncle Matthew might have put it: there's an awful lot of abroad.
Similarly, in winding up, I am sure that no one will expect me to cover all the points that have been made. I am sure that all noble Lords will bear with me if some of the points are not covered. I can give an assurance that, as always, I or my noble friend will write where appropriate when specific questions have been asked. I join the noble Lord, Lord Judd—this is one point on which I believe we can agree—in saying how much we shall learn from mulling over Hansard tomorrow. I am sure that it will be a very useful exercise for us all. The noble Baroness, Lady Blackstone, called for further debate, particularly on the UN, and other noble Lords made other suggestions for interesting debates. I am sure that these matters will have been noticed by my noble friend the Chief Whip and will be considered by the usual channels as and where appropriate.
For a debate that covers both foreign affairs and defence matters, relatively little, dare I say, was said on defence. I should like to make a couple of fairly brief points on matters relating to my own department.
First, it is right that I bring the House up to date on the main developments of the defence costs study, which was referred to by the noble and gallant Lord, Lord Craig of Radley, and by other noble Lords. Since I addressed the House in late July there have been certain developments in the debate about defence. I shall not go over all the background again except to re-emphasise that none of the proposals emerging will in any way reduce the operational effectiveness of our forces. Indeed, many will facilitate improvements in capability. I ask my noble friend Lady Park to look at the effective capability of our Armed Forces rather than the simple figures in terms of what we spend.
Since July we have been involved in a period of formal consultation on the Front Line First report with trade unions and others with particular interest in the various proposals. Obviously, because of the comprehensive nature of that report, we allowed an extended period of three months for the consultation,
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which came to an end last month. As well as consulting on the Front Line First report itself, we have also issued a number of consultative documents giving details of individual proposals. As and when consultation on particular proposals comes to an end, we shall consider with the greatest care all the comments received before taking final decisions. We intend to make those decisions public as they are made rather than brigade them into a single announcement. Only in that way can we minimise the period of uncertainty—again this was a concern of the noble and gallant Lord—that our staff may have to face.
I turn to one other development in relation to Front Line First which was referred to by my noble friend Lord Vivian; namely, the study into defence intelligence reported at the end of July. My noble friend will understand why we shall not be making public all the measures that we propose to implement. The main one is for a major reorganisation of the central defence intelligence staff within the department. We have concluded that there is scope to increase efficiency and reduce costs through reforms similar to those which we intend to introduce in other areas. On a wider front, we have set in place comprehensive arrangements to implement each and every proposal emerging from Front Line First, subject of course to the outcome of any consultation. I can give an assurance to the House that I and ministerial colleagues in the department will remain highly committed and closely involved in this vitally important process of change.
I understand that any changes can give cause for concern, as the noble and gallant Lord quite rightly stressed, and that that concern can have major effects on the morale of our Armed Forces. But I certainly hope that the reassurances given by my right honourable friend the Secretary of State on the need for a period of stability will go some way towards helping.
Perhaps I may say a few words in response to the noble Earl, Lord Attlee, on a matter that concerns both of us; that is, the reserve forces. The noble Earl will recognise that reserve forces legislation was not referred to in the gracious Speech. As the noble Earl knows, new legislation is required to permit us to make more flexible use of our reserves in post-cold war circumstances. In the light of the fact that we are not able to bring forward legislation this year, I can now confirm that we plan to publish that draft legislation on the reserve forces in 1995, allowing time for detailed consultation on its provisions and amendment, if required, before the Bill is introduced to Parliament. However, I have to say to the noble Earl that I do not think it is likely that that will give us an opportunity to introduce legislation on this subject in the coming year.
I wish to say a few words about European issues, particularly about the own resources decision and the legislation that will be involved. The noble Baroness, Lady Blackstone, wanted to know whether the Bill could be passed without amendment or whether amendments would be possible. I have to stress to the noble Baroness—this point was picked up by my noble friend Lord Cockfield—that the whole Bill must be passed without amendment. The United Kingdom Government gave an international commitment that they

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would so do and they must implement that commitment. I should remind the House that both Houses of Parliament welcomed the outcome of the Edinburgh Council, on which the own resources decision will be based, and the Bill quite simply implements that agreement and our commitment to' it. The Bill will be introduced in another place tomorrow and, as I said, will implement the decisions of the 1992 Edinburgh Council, which was a rigorous settlement designed to meet the needs of the Community until the end of the century while taking into account what member states can afford. It will result only in a modest increase in the size of the Community budget.
I should like to stress the facts of what that implies. The own resources decision implies an increased cost to the United Kingdom of £75 million in 1995–96 rising to £250 million in 1999. It preserves the United Kingdom abatement which has saved us some £16 billion since 1984. It keeps our increase proportionately smaller than those of most other member states—we are now slipping down the net contributor table—and it was much better than it could have been. As noble Lords will remember, the Commission originally wanted an own resources call-up to reach a total of 1.37 per cent. of Community GNP by 1997 rather than the agreed figure, as my noble friend Lord Cockfield reminded the House, of 1.27 per cent. in 1999. If we had gone for that higher figure it would have meant an extra £8.5 billion in 1997, instead of the £1.75 billion in 1997 and £3.5 billion in 1999 under the Edinburgh agreement.
I should also point out that increases in Community spending are now slowing. The own resources decision settlement provided an average increase in Community commitments of some 3.3 per cent. per year in real terms from 1992 to 1999 as against what we have seen between 1987 and 1992 of some 5.3 per cent. I believe that the stories which are circulating which suggest a sharp rise in our net contributions between 1994–95 and 1995–96, as a result of the Edinburgh agreement, are somewhat misleading. They are in fact wrong. Implementing the own resources decision will have some effect, but it is a modest one. The underlying trend of our contributions may he upwards but that reflects an increase in our GNP growth relative to other states.
Perhaps I may say a word or two about the intergovernmental conference in 1996. I can assure my noble friend Lord Cockfield that we shall have a most positive agenda for that conference. We shall obviously want to encourage greater flexibility, enable enlargement, develop CFSP, fight fraud and entrench subsidiarity. I can assure all noble Lords that subsidiarity, whatever the noble Lord, Lord Hooson, might think, is in fact working. There were 185 registered proposals in 1990; 75 in 1993; and so far only 39 this year. We shall continue to work for greater financial discipline and we shall continue to strengthen the role of the national parliaments. We shall certainly oppose any weakening of the power of the Council of Ministers, the merging of the pillars or removal of the United Kingdom opt-outs. I certainly do not expect us to be isolated and I certainly expect plenty of support for our views.
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I would like to reassure the noble Baroness, Lady Blackstone, and my noble friend Lord Beloff, that we are not outsiders in the European Community. We are not the pariahs that she seems to suggest that we are and we have actually achieved a great deal by our negotiating and methods of dealing. We do not always lose the arguments. I can give a long list of negotiating successes including the enlargement—which is something which we originally proposed—the GATT Uruguay round, the Edinburgh own resources decision; subsidiarity (which I have also just mentioned), and the social protocol where I believe the noble Baroness and I will simply have to agree to differ on opting-out. I believe that it was a great success for this country. There was also the 1988 Budget discipline decision.
Lastly, the noble Baroness pressed me on when and if we shall join monetary union. She seemed to imply that I might be evasive in responding on that point. I can assure the noble Baroness that I am not going to be evasive. Put very simply, it is a matter for Her Majesty's Government, as the noble Baroness knows, and Parliament to take a decision if and when they have to. It is not an issue which is before us now. I say to the noble Baroness that I suspect that it looks unrealistic for 1997. That is certainly not just the view of Her Majesty's Government. The president of the European Monetary Institute said just that on 14th November.
I turn now to the question of aid and the Pergau arms sales. I start by re-stressing all the points made by my noble friend Lady Chalker and underlining everything she said on aid and our aid record. I have to repeat to the House in particular that I do not believe that I can emphasise enough that there is quite simply no link between aid projects and defence contracts in Indonesia, Jordan, Oman or in any other markets which noble Lords care to mention. Allegations of that sort are quite simply untrue. They are based on spurious correlations between provisions of aid and arms sales. I totally reject the allegations made by the noble Baroness and others on this issue that our aid projects are linked in any way to arms sales.
If I may, I should like to say a word or two about arms sales. The noble Lord, Lord Mayhew, suggested that we should be trying to remove arms sales from all parts of the world. The theme of the speech of the noble Lord, Lord Judd, was that somehow they were intrinsically wicked in themselves and we should not be involved in them. I have to say - I think that many noble Lords recognise this - that all states have a right to self-defence, recognised by Article 51 of the United Nations Charter, and that countries need defence equipment to exercise that right. The United Kingdom's exports of defence equipment are responsible. We consider applications for licences to export defence equipment on a case-by-case basis against established criteria, including internationally agreed guidelines. The criteria include human rights. Perhaps I may also stress that they would include questions such as excessive military expenditure. They include such matters as regional stability and the economic and technical capacity of the recipient state. We do not export equipment that is likely to be used for internal repression.

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As the noble Lord, Lord Judd, was prepared to admit, the United Kingdom wants to see more and greater transparency and responsibility in conventional arms transfers. The UN register of conventional arms was set up after a personal initiative of the Prime Minister. We are currently involved in multilateral discussions on new arrangements to promote transparency and responsibility in conventional arms transfers. I have to say that I believe that much of the recent media interest in the United Kingdom's defence exports has been both ill-informed and hysterical.
Perhaps I may also briefly re-emphasise some points about our aid programme. We maintain a very substantial aid programme, whatever the noble Lord, Lord Judd, says. It is now the sixth largest in the world and has risen by some 10 per cent. in real terms since 1987–88. The aid budget is some £2.2 billion. In 1993 our aid was 0.31 per cent. of GNP, but that is still above the average of all the other OECD donors. More importantly, some 80 per cent. of our bilateral aid goes to the poorest developing countries, a higher proportion than that of any other G7 donor. Perhaps I may also refer the noble Lord to private investment, which can have equally beneficial effects as aid from governments. The UK's direct private investment in developing countries is consistently around half the EC overall total, and for 1992 was estimated to be some £1.7 billion.
As I said at the beginning, it would be very difficult to cover all the subjects that have been raised; there have been a great many. But perhaps I may say a word or two about the United States lifting its arms embargo on Bosnia. I sensed general agreement in the House on that and I was grateful for the support of the noble Lord, Lord Mayhew, for Her Majesty's Government's policy here. Obviously, I understand the worries that it raises in relation to our general NATO relations. We have seen a very changed environment in NATO over the past few years and the removal of the certainties of a few years ago will mean that we shall have to work harder to ensure that NATO continues to serve our interests as it has done so well over the previous 40 years.
As regards the effect of the US policy shift on Operation Sharp Guard, I have a sneaking feeling that the noble Lord slightly overblew its significance. We are certainly confident that the operation in the Adriatic can continue to be effective, sad though the US decision is. I think that I should say further and very simply in terms of our own policy that, if there was a total lift of the embargo by the United Nations, there would be no way in which we could continue to keep our forces in Bosnia and the former republic of Yugoslavia. Put very simply, there can be no lift-and-stay policy.
I appreciate that there has been a vast array of matters that I have not addressed in the time available this evening. I know that the noble Lord, Lord Mayhew, would like me to develop further his arguments on nuclear proliferation, but perhaps I can do that by correspondence. I have not touched upon Palestine, Hong Kong, Cuba, the Ukraine, Kashmir or the many points relating to human rights. In view of the time, I hope that noble Lords will bear with me if I now move on and say that I should like to end by paying tribute,
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as my noble friend Lord Wade of Chorlton did yesterday when moving the humble Address, to the men and women of our Armed Forces.
As I made clear when I opened, the debate has been wide-ranging and extensive. It has covered a vast array of matters. It is right that on occasions we should try to cover all matters relating to foreign affairs and defence in one evening. There will be further opportunities to debate these matters, focusing in greater detail on specific concerns. Nevertheless, I believe that on occasions such as this we should remember just how much our security and future depend upon the men and women who serve in the Armed Forces.
Our Armed Forces are deployed throughout the world on a wide variety of dangerous and difficult jobs. It is obviously not possible to mention them all, and by touching on just a few I wish in no way to disparage the duties and actions of others in other parts of the world. I shall start by mentioning those in Bosnia in the former Republic of Yugoslavia as they face their third winter in that theatre where their achievements in humanitarian relief have been dramatic and for which - dare I say it? - they have not received the praise or coverage of the press which they deserve.
I should mention also those in Northern Ireland where we have now seen soldiers serve in dangerous conditions in aid of the civil power for some 25 years. It is their largest peacetime commitment. They have prevented countless terrorist attacks. They have saved the lives of many people, both Catholic and Protestant, at great risk to themselves. Above all, they have, with the help of the community, prevented terrorists on both sides from achieving their aims through violence. Let us hope that the peace process can continue and that that pressure on the Armed Forces can in time be reduced.
Let us also remember those in Rwanda where some 600 military personnel have made a major contribution to UNAMIR, as well as all the others engaged in United Nations roles of one sort or another. There are more than 7,500 in Cyprus, Iraq, Kuwait, Georgia, Rwanda and the former Republic of Yugoslavia.
The noble Baroness, Lady Blackstone, asked how many we could currently place at the disposal of the United Nations. The noble Baroness will obviously not expect me to answer that question, and I do not believe that I can. Each case will be considered on its merits. I can say that our record speaks for itself. Those 7,500 soldiers engaged, as I said, in what one might refer to as blue-beret operations or in support of United Nations Security Council resolutions, show how much the UK is committed to the support of UN operations.
Baroness Blackstone: My Lords, I am grateful to the noble Lord for giving way. He must have misunderstood what I said if he implies that each case stands on its merits. My question was about standby forces and what the UK Government will consider committing to standby forces. That is not a matter of considering each case on its merits. I accept that the Government may not

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yet have made decisions about that; but I should hope that at some time in the future we can be told what is the Government's position.
Lord Henley: My Lords, I am sorry if I misunderstood the point behind the noble Baroness's remarks. I shall take them up and possibly write to her on that matter. I was trying to show to the noble Baroness—and I am sure that she will be the first to agree with me—that we have a very fine record of supporting UN operations. Those 7,000 or 8,000 men and women speak very much for themselves.
To all those men and women, whether in the Army, Navy or Air Force, we owe a great deal. It is right that on behalf of Her Majesty's Government I should place on record what we owe them. At the same time, knowing the concerns expressed by the noble and gallant Lord and by the soldiers, sailors and airmen themselves following both Options for Change and the defence costs study Front Line First—there have been legitimate concerns about their future—it is right that I should repeat the assurances given both by my right honourable friend the Secretary of State and my right honourable friend the Prime Minister that the big upheavals in the Armed Forces are now over. The Armed Forces are now of an optimum size for today's uncertain world and there will be no new cuts to our front line capability.
Our Armed Forces have justifiably built up an extraordinary reputation for efficiency and professionalism throughout the world. We can quite
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rightly be proud of them and reliant that they will continue to serve in the best interests of this country's security and wider interests in an uncertain world.
Lord Strathclyde: My Lords, on behalf of my noble friend Lady Blatch, I beg to move that this debate be now adjourned until Tuesday next.
Moved, That the debate be now adjourned until Tuesday next. —(Lord Strathclyde.)
On Question, Motion agreed to, and debate adjourned accordingly until Tuesday next.

Bodmin Moor Commons Bill [H.L.]
Presented, read a first time, read a second time pro forma and committed to a Select Committee.
London Local Authorities (No. 2) Bill [H.L.]
Presented, read a first time, read a second time pro forma and reported from the Select Committee and recommitted to an Unopposed Bill Committee.

British Waterways Bill [H.L.] City of Westminster Bill [H.L.] Malvern Hills Bill [H.L.] River Calder (Welbeck Site) Bill [H.L.]
Presented, read a first time, passed through all their remaining stages pro forma and sent to the Commons.
House adjourned at fourteen minutes before eleven o'clock.

  SERVICE MARRIED QUARTERS: MANAGEMENT
  SERVICE MARRIED QUARTERS: MANAGEMENT
  DERBY TERTIARY COLLEGE, WILMORTON AND ST. PHILIP'S ROMAN CATHOLIC SIXTH FORM COLLEGE: GOVERNANCE
  DERBY TERTIARY COLLEGE, WILMORTON AND ST. PHILIP'S ROMAN CATHOLIC SIXTH FORM COLLEGE: GOVERNANCE
  BATHING WATERS SURVEY
  BATHING WATERS SURVEY