Select Committee on Defence Minutes of Evidence

Examination of Witnesses (Questions 40 - 59)



  40. Have you flown on the flight deck?
  (Mr Straw) I think so. The very first occasion was when I went with Mr O'Neill to Ghana via Lagos and with Kate Hoey, who promptly fell down an empty hole.

  Chairman: Are you sure this should not be in confidential session!

Mr Howarth

  41. May I tell you that I did spend considerable number of hours on the flight deck of a British Airways 747 from Kenya to London. The point I want to make is that the radar infrastructure in Africa is so appalling that the only way in which airline safety is assured is by the pilots of civil airliners speaking to each other through a particular channel to report their positions every ten minutes. This is the way that collision avoidance is secured. Therefore, would it not be the case that the export of excellent British systems to Tanzania would be of benefit not only to Tanzania but to all those travellers in the air over the continent of Africa?
  (Mr Straw) Mr Howarth, thank you and I note what you say. I was made aware yesterday of the letter that you were sent and, indeed, what was said in this letter. It was plain to me that this matter is now very fully on your record and therefore I should do my best to speak about it in this session. However, if I may make this clear, the question per se of what it feels like to fly over Africa in a civilian airline is again not a relevant criterion. What we have sought to do is simply to apply the criteria and come to the best judgments that we can.

  Donald Anderson: Secretary of State, you seemed a little surprised that Mr Baldry having teed up the ball so well in respect of this did not actually strike the ball.

  Tony Baldry: I got the answer that I wanted.

Donald Anderson

  42. You said that the Government were indeed indivisible. Can one have any other construction then of the Secretary of State for International Development's decision other than that the Government disapprove of this contract?
  (Mr Straw) There is neither an issue of approval or disapproval, it is working within the framework of the rule of law and of policy and different criteria apply. This is why I made the point I did a few minutes ago when I drew to the public's attention, as well as the Committee's attention, that there is no issue directly of the British taxpayers' money being involved in this contract and so the question is do we license others to make the export or not? Impalpably, Mr Anderson, quite different criteria apply where British taxpayers' money is at stake. If it is we who are buying the equipment or paying for it directly or, as it happens in respect of any country who are recipients of aid where we are providing aid, it is entirely right and proper and also has to be lawful that the relevant Secretary of State has to apply to himself or herself the criteria which operate in that case. That is what Clare [Short] is doing here, as any other Secretary of State for International Development would do. I am sure I will think of examples when I get out of this room, Mr Berry, but I can think of plenty of examples from my time certainly as Home Secretary where I would make a decision on one set of criteria in Government which was different from decisions which were also right which had to be made on a quite separate set of criteria elsewhere.

Tony Baldry

  43. The Tanzanian Government might not have been quite so keen to welcome the decision as put forward by Mr Howarth if they had known as a consequence of that decision their bilateral development aid budget was going to be suspended.
  (Mr Straw) That is a judgment that I cannot make.


  44. I think we have to move on to other topics. Can I ask a new question about the information in the report, Secretary of State. In relation to information on refusals, your response to our questions seems to suggest that disclosure of more information on refusals was something that you were not particularly enthusiastic about. My question would be would this not be an effective way of, as it were, naming and shaming our competitors, perhaps EU partners, who engage in undercutting, assuming, of course, that we never engage in that practice?
  (Mr Straw) I do not think we do. It is perfectly possible, for the reasons I explained right at the beginning, that, on our best judgment, we may come to a decision to approve a licence and other EU partners may come to the opposite decision. I say again some of these are very, very finely balanced judgments indeed. There is no part of our consideration to go into what is called undercutting but, as I say, that is possible. On some of the detail about European Union practice, other European Union countries, with respect I need to deal with that in a closed session.

  45. My next question was going to be whether you would be prepared to tell a little more about the possibility.
  (Mr Straw) Yes.

Mr Howarth

  46. Foreign Secretary, if we can turn to wider policy issues. This is a rather big question I acknowledge. Where do you think the balance lies in policy between doing good by restricting arms sales and doing good by encouraging the UK's defence manufacturing industry?
  (Mr Straw) I think there is a balance there, as there usually is in Government decisions. In the longer term I do not happen to think that the two are in conflict. At any one moment these two objectives of trying to create a safer world through an effective international and bilateral system of arms control and the other side having a profitable and viable defence industry can be in conflict, because I am always conscious of the fact that where I refuse a decision that is going to have consequences for the turnover, profitability and the employment of the individual firm at the time. It is in the long term, and even in the relatively short term interests of this country we should make the international community as safe as possible. It is not that you can ever avoid conflict using military weapons, we are not a country which has a pacifist policy as far as international relations are concerned. We recognise the importance of having strong viable defence forces because such is the nature of the world—as we have seen in Afghanistan—that they have sometimes to be used and used effectively. The more we can control the flow of arms and the more we can deal with states which are in turn supporting rogue states and terrorists by their own sale and supply of arms the better it will be for the overall international environment. Then we can come back to the issue of prosperity because what we know for certain is that where countries are riddled by conflict then they quickly slip into poverty and if anybody wants a better example of that they only have to look to Africa, Central and Southern Africa. If one looks, for example, at the trade other than of minerals from countries in Central Africa, it is tiny and it is tiny because of conflicts which have been caused there.

  47. In your travels around the world now, since you became the Foreign Secretary, how have you found your reception in those countries where Britain has been an exporter of defence equipment? Have you found them to be particularly appreciative of Britain's support?
  (Mr Straw) Support for?

  48. For defence exports to those countries, have you found them to be appreciative of that? Have you found them to regard that as the actions of a friend and ally in assisting them and has the export of defence equipment thereby assisted in promoting not only stability in the region but also promoting Britain's interest?
  (Mr Straw) It is hard to generalise.

  49. I did say those countries who did.
  (Mr Straw) When I visit any other country on a bilateral visit, indeed in many cases when I am in international fora as well, I ask for a briefing on any representations which I can properly make on behalf of British companies and British exporters. That by no means just includes defence and related suppliers but any other British company. I do my best to represent the interests of British exporters and British business, obviously within the framework of international law at the same time. Mr Howarth, you asked me how far my representations are appreciated, I think much depends on who I am talking to whether they are convinced.

  50. Sorry, Foreign Secretary, I did not mean those countries where you have a brief, as it were, to promote a particular British contract which is under discussion but those countries, obviously Saudi Arabia, where we have been an important contributor to their defence posture, and there are other countries around the world. I wonder, have you felt that has been an important factor in cementing a relationship with the United Kingdom?
  (Mr Straw) It is one factor is the answer and it varies from country to country. The nature of any industrial commercial relationship is one factor in the relationship but there are countries around the world, particularly in Africa, where our trade is relatively small but our relationship is a very strong one. I give you perhaps the example of Uganda where I speak from recollection, we are currently providing about £45[1] million of aid to Uganda. It has been a very successful programme which Clare Short has developed over the past five years there and one of the consequences, for example, is there is now the universal primary education because of the kind of leadership we are providing there. At the same time when I visited Uganda I noted that our trade with Uganda at £37 million is less than the aid we provide to them. I do not draw any conclusion about that but I would accept this is a country which has been through the most terrible deprivations in the past and that we are right to support it through aid. We have a pretty close relationship with President Museveni and his colleagues there. Over time as the aid trails off we will look forward to a time when Uganda, along with other African countries, becomes a lot more prosperous and with a bit of luck in time there will then be a natural demand for British goods.

  51. Do you acknowledge the importance of defence exports to Britain's defence manufacturing capabilities?
  (Mr Straw) Yes.

  52. Because we have a limited market in our own country, would you not agree that, to obtain the economies of scale we need to have a defence export capability as well?
  (Mr Straw) Yes, I do. The answer that Peter Hain gave on 26 October 2000 which picked up in this particular respect what Robin Cook said on 28 July 1997 sets out very clearly the context in which we would take account of the importance of the British defence industry and it is important but not to the point where the importance of the British defence industry could be allowed to override key considerations like countries which are in breach of their human rights obligations or engaged in internal repression or where they are a risk to regional stability. If you are asking me outwith these consolidated criteria could we have as efficient armed forces as we have without a pretty significant and successful defence industry sector, and could that defence industry sector be as successful as it is without exports, the answer to both those questions is no, I am aware of that. Those two considerations cannot ever justify a breach of these consolidated criteria.

  53. Do you think we should be exporting more?
  (Mr Straw) Provided they are within the criteria and not outwith the criteria, yes, of course we should, as we should in every other field.

Rachel Squire

  54. Can I ask about the International Trade In Arms Regulations with the United States. During a recent visit to Washington of the Defence Committee we discussed the lack of progress on reform on those International Trade In Arms Regulations on a number of occasions. Very much the majority response of those we discussed it with was that there was no justification for the bureaucracy and delays that the present system had caused. I really want to ask you, Secretary of State, whether any progress has been made towards agreeing with the United States a waiver for the UK from the US International Trade In Arms Regulations? Also, what are the remaining sticking points?
  (Mr Straw) May I ask Mr Ehrman to answer this. I am happy, obviously, to take supplementaries.
  (Mr Ehrman) Thank you. The discussions with the United States on this issue are continuing. They are continuing constructively and amicably. The issues still to be finalised and discussed are some of the technical points relating to the compatibility of our export licensing regulations with the proposal of the United States to allow unclassified equipment to come to this country. So we are still in negotiations with them but the negotiations at the moment are going well.

John Barrett

  55. If I could then turn to sustainable development. If excessive spending on arms is not to adversely affect health, education and social services of our country, is it not the case that we need a definition of sustainable development? Does the Government have, or intend to develop, a workable definition of sustainable development, and clear benchmarks, setting out what exports would be likely to hamper a country's sustainable development, against which licence applications can be assessed? This may or may not bring us back to the Tanzania air traffic control system.
  (Mr Straw) As I say, we are in relatively new territory here with the principles of sustainable development. There are two parallel things in train. One is that the Cabinet Office is undertaking an exercise with relevant Government departments in assessing the procedures for judging the criteria. It is not possible to say in advance that goods to X exported to country Y are going to breach any of the criteria including Criterion 8. You will be aware that the criteria themselves, which are what we have to follow, say that they will not be applied mechanistically but on a case by case basis using judgment and common sense they would have to be. Sustainable development is an important criteria. It is also one which by definition is more likely to be the subject of some difficult judgments because it is a very wide idea. It is wider than some of these other criteria, that is in its nature. That is one set of developments which are short term. Secondly, as I think you will be aware, in the Export Control Bill, as amended, the Secretary of State if this Bill goes through, as I think it will do, is required by Clause 7(4) that the guidance required by subsection 3 must include guidance about the consideration, if any, to be given when exercising such powers to issues relating to sustainable development and to issues relating to any possible consequences of the activity being controlled that are mentioned in paragraph 3 in the Schedule. So there will be more detailed guidance there as well.

  56. Are you content that a workable definition of sustainable development exists or should that be produced?
  (Mr Straw) What I would say—to use the word again—is we are involved in an iterative system where we are building up experience, and that is the crucial thing here. There has been a lot more experience about classic defence military criteria. There are some possible export licence applications which do not require more than a milliseconds' consideration because it is perfectly obvious that if we have an order for arms to a known and notable rogue state the answer to that is no and that is the end of it or where it is a military only piece of material, which has only one application, not dual use, and where it is clear beyond any peradventure that it would be used for internal repression far exceeding any need for maintenance in a proper sense of law and order within human rights bounds. Those are straight forward cases, as it were. At the other end, not least because it is a new area and it is an intrinsically wider definition, there is the issue of sustainable development and what we have to do is to carry on building on the experience that we have had.


  57. Can I just say, Secretary of State, you do keep referring to making decisions on a case by case basis. At the end of the day there are cumulative effects. The sum total is not simply adding up the individual bits, as it were.
  (Mr Straw) Yes.

  58. Is it not necessary at some stage to get beyond simply a case by case basis for evaluating some issues?
  (Mr Straw) I talk about case by case basis because that is the basis on which we are required to work. It says these will not be applied mechanistically but on a case by case basis using judgment and common sense but that is no different from any other system of this kind where you try and lay down rules in advance. You have a system for making judgments on individual decisions and then you have a system for retrospective scrutiny. If I can give you an example in which I have been involved, both in my previous job and in this job, which is a discrete area where there is a lot of experience. If you take the issue of interception warrants, there are criteria laid down by Parliament in Acts of Parliament. You have to deal with each case on a case by case basis but matching the individual cases before you against the criteria laid down by Parliament and, as it happens, very detailed codes of guidance as well. Then behind that, when the Secretary of State has made his or her decision, there is a system of retrospective scrutiny which although it takes place in private, because it has to, is nonetheless very thorough, in this case it is undertaken by a senior retired Court of Appeal judge, so that is the way it works. I do not see, in terms of process, any other way of achieving the end that we all desire which is that we have a good and straight forward system of export controls. I do think as what is a relatively new system beds down and experience is built up then the system can become more predictable because the areas of real discretion will become less.

Tony Worthington

  59. Just a very quick point really. Do you accept that because of the new situation with regard to HIPC, with regard to deals being done between the World Bank and the IMF and ourselves and poor countries in Africa or elsewhere, that in future it will not be acceptable to have debt forgiveness and assistance to those countries unless at the same time we are, when we have a choice, preventing them from inappropriate behaviour, such as air traffic control systems which are ludicrously expensive?
  (Mr Straw) Mr Worthington, that begs a lot of questions. My view is that what we have to do, so far as export controls are concerned, is apply the criteria and apply the criteria in as fair and appropriate way as we can.

  Chairman: Can we move on to prior parliamentary scrutiny and Sir John Stanley.

1   Note from Witness: The actual sum of bilateral aid to Uganda in 2001 was £69 million. Back

previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2002
Prepared 19 July 2002