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7.32 pm

Sir Robert Smith (West Aberdeenshire and Kincardine) (LD): Thank you, Mr. Deputy Speaker, for giving me the opportunity to take part in the debate on the Queen's Speech. Before discussing the Queen's Speech, I want to reinforce what Mr. Speaker said in the statement he made before we dealt with the Sessional Orders.

There is a report on the Table from the Procedure Committee that, I hope, will enable us to see a way forward that would make it easier for Mr. Speaker to start the Session of Parliament in a way that allows slightly more access for the watching public. It occurred to me that when Committees of the House publish such reports for the House's benefit, perhaps we should alert people to their existence by means other than the traditional ones, as quite a few colleagues did not know of the existence of the Procedure Committee report. As a plug, I should say that the Procedure Committee report on proceedings, the way in which debates are handled and related issues comes out tomorrow. Members might want to have a look at it.

I want to touch on aspects of the Queen's Speech that affect my constituency as well as issues raised with me by constituents. The first is the proposed legislation on occupational pensions and the guarantee that will be introduced to protect people in the future. Other Members have spoken about the pension issue and the problems for pensioners in certain schemes, but the biggest victims at the moment are those coming up to retirement, who have trusted in a scheme and put their money into it only for it to go bust at the last minute. They are the last in the queue and the greatest victims of anything that goes wrong. While it would obviously be

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welcome to have some underpinning and protection for the future, I am concerned that during the passage of the legislation we find a way to deal with current victims of schemes that have gone bust, leaving them high and dry.

I understand where the civil contingencies legislation is coming from and the concern to address the threats that society lives with, but I hope that we do not develop a fortress mentality as the legislation progresses. At the weekend, people were talking about trying to defend all the iconic buildings in London to the same extent as the American embassy is defended, but I do not think that the British public would want to see such protection in our country. I should like to see much more intelligence-based and much more sensitive policing and reaction to the threats that we face.

Members should compare the protection needed to bring our Head of State to this Parliament to open it and that which the American Head of State had to have to come through our streets. On the whole, this country would prefer to stick with the British style of doing those things.

Phase 2 of House of Lords reform has already been touched on. Quite honestly, it is not phase 2. We were promised a two-stage process.

Mr. Andrew Love (Edmonton) (Lab/Co-op): It is phase one and a half.

Sir Robert Smith: It may be half a stage, or even a backward step. Unless the Government are going to come up with the proper final package, we should carry on with the House of Lords that we have until we see something tangible that takes us forward into the 21st century.

On the plus side of involving the public, a draft Bill is to be produced for the euro referendum. Obviously the Government have not gone far in taking this country towards joining the euro, but the benefit of making some progress is that it at least sends the market and those who are thinking of investing in this country because they still see a long-term chance of it taking a step towards euro membership a signal that the debate is still going on.

The longer we wait, however, the more we will adapt our economy to living outside the eurozone and the less easy it will be for us to join the euro. I was talking to some large manufacturers, who were concerned that their investment for the European market would have to shift to mainland Europe and into the eurozone. To get round that, although they are outside the eurozone here, they are sourcing all their supplies in euros, so either suppliers in this country have to take the currency risk or suppliers inside the eurozone have an advantage over the domestic supply. It is extremely important that the Government take the matter forward.

The Government have finally made proposals, it would appear, to take forward the energy White Paper, which is welcome. If they take forward the opening up of Scotland's electricity market, that, too, will be welcome. The Trade and Industry Committee has been considering draft clauses of a Bill in respect of the British electricity trading and transmission arrangements, but the Government will still have to address anomalies in

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the different transmission systems in Scotland and England and ensure that small generators are not penalised for trying to connect to the network.

The Government finally recognise the need to deal with the huge liabilities of the nuclear industry, but I am disappointed that they are not willing to go the whole hog and establish a segregated fund for those liabilities. Instead, they have opted for a segregated account, but the worry is that future Governments could raid that account. Perhaps the proposal for a separate fund can be addressed when the energy Bill goes through the House.

I hope that the energy Bill will be sufficiently widely drawn that it will deal with other concerns raised by my constituents about renewable energies and alternatives. On Monday, I was looking at proposals for a district heating scheme in Braemar that would rely on wood fuel as its source of heat. A lot of hard work has gone into the scheme, but there is frustration that the incentives for biomass and renewables do not apply to wood taken from the thinning of forestry.

It is important that the Government readdress that to try to get the balance right. In the same way as nuclear power was the cuckoo in the nest that took all the money for alternative energy sources, there is a worry that wind power is so far ahead that it will become the cuckoo in the nest that holds back other alternative renewable sources of generation. I hope that the energy Bill will propose ways of levelling the playing field to encourage other long-term alternative energy sources. The United Kingdom has plenty of coastline, so we could take advantage of tidal stream energy. If we could crack that, it would be a reliable and predictable source of energy.

If the timber from the thinning of forests were counted towards renewable supply, it would have the double benefit of encouraging people to manage their forests better. If the next generation are to get the best productivity, many of our forests need to thinned now. The market for that timber is so bad that people are neglecting the management of their forests.

The Government give renewable incentives only to renewable electricity, but heat from other renewables instead of carbon fuels is equally beneficial in tackling global warming. I hope that the energy Bill will be amended to deal with that issue.

The hon. Member for Blaby (Mr. Robathan) referred to the size of the Scottish Parliament. I welcome the recognition that the Scottish Parliament is there to serve the people of Scotland, and should be of a size that best enables it to fulfil that function. Its size should not, as the Prime Minister wanted, be dictated by the number of MPs at Westminster. We welcome the reduction in the number of MPs at Westminster in recognition of devolution to Scotland. Like the hon. Gentleman, I would go further and would contend that, as we make constitutional changes, we could reduce the size of this Parliament as well.

The size of the Scottish Parliament should be dictated by its needs—its Committee structure and the structure of the Executive—and what the Scottish electorate want from it. I hope that the legislation to deal with the size of the Scottish Parliament will allow us also to consider the method of election to it. There is a desire to move to a system that gives more power to the electorate and reduces the power of the parties. It should also make all

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Members of the Scottish Parliament equal. There has been some concern that the list system has produced two types of MSPs: one for the constituency and one for the list, and those on the list sometimes tread on the toes of those for the constituency. A switch to a single transferable vote system would be extremely attractive.

Mr. Love: The hon. Gentleman should not hold his breath.

Sir Robert Smith: Well, there is a groundswell of opinion. It appears that we will have a single transferable vote system for local government. That Bill has been introduced in the Scottish Parliament, and I think that the electorate will be attracted by a similar system for the Parliament that represents them in Edinburgh.

The Gracious Speech refers to the draft constitutional treaty for the European Union and to legislation to implement the treaty. I hope that the Government will finally wake up to the fact that, if the treaty still contains constitutional changes, its implementation should involve the British public in a referendum. That would have several benefits. It would enable us to have a debate in the country about our relationship with Europe. It would focus people's minds, and we could decide where we want to be in Europe.

A referendum would also strengthen the Government's negotiating arm. It is always handy to be able to say, "I understand where you're coming from, but I have people back home whom I have to convince." The Prime Minister wants to draw a red line on certain aspects of the constitution, and a referendum would be beneficial to him in his negotiations.

I declare an interest, which is in the Register of Members' Interests, in oil and gas exploration. I want to highlight the concern of many of my constituents about future investment in the North sea. They are worried that the current drafting of the European constitution contains a chapter on energy that holds the door open for the European Commission to get involved in the licensing regime in the North sea. The constitution has been broadly drafted and it needs to be amended. At this late stage, the Government seem to have woken up to the need to amend it, and it is now important that they show the resolve to achieve that amendment in negotiations and not to use it as something to be negotiated away in order to gain other benefits.

The Commission claims to have no interest in the North sea in the short term. However, if the treaty is not amended and a future Commission realises that it has powers that it did not have before, or if the European Court says that the Commission has the power to intervene and the Commission does so, it will upset the arrangements that have attracted investors. No amount of reassurance that the Commission will not use that power will protect investors from that uncertainty. We saw what happened when the Chancellor changed the tax regime in the North sea. It was not just the change that frightened investors, but the fact that he showed that things could suddenly change. Investors need some certainty, and they welcome the fact that the Foreign Office will tomorrow meet an all-party delegation to discuss the clauses in the energy chapter. We must ensure that the Government remain robust.

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The media have focused on the Bills in the Queen's Speech. The Government might be introducing too many measures, and we need time to scrutinise them effectively, but government is about not just producing Bills but executive action, the day-to-day workings of government and the delivery of government functions. At the end of the Queen's Speech are more fundamental aspects that will affect our constituents, such as security and the international climate, the threat of terrorism throughout the world, and the work of this country in promoting peace in the middle east. There is a commitment that the defence White Paper will finally be published. There is concern in many quarters about the future of our regiments. I hope that the White Paper will end the uncertainty, and that regiments such as the Highlanders will be able to continue to recruit. We must get the message to young people that they could have a long-term career in the Army.

Mechanisation and automation of the battle stage of conflict is increasing. As a result of the military's investment in equipment, the Army may need fewer troops at that stage. However, given the need for a flexible response to an uncertain world and for the policing that follows military operations, it is people on the ground who are important, and this country can be proud of the professionalism and the quality of its military personnel. They offer the rest of the world a shining example of how to police such situations. They need to maintain numbers, and it would be dangerous for the White Paper to recommend any reduction in the size of the Army. I hope that we can get the message across to young people in our constituencies that there is a future and a career to be had in the Army.

Many of my constituents lobbied hard for the reduction of debt in the Jubilee Debt Campaign. They want the millennium development goals to be achieved, and the commitment in the Queen's Speech to be translated into action. They also lobbied hard on the issue of fair trade. I still have reservations about Cancun. I am not sure what is the best outcome. The worry is that the breakdown of the talks in Cancun may have been seen as a victory for the smaller nations, but if it means that the United States of America is more likely to walk away from international engagement and go for bilateral deals, some of the poorest nations will suffer. We must get trade negotiations back on to an international footing.

The Government will have to work hard in that respect, because the USA may abandon the multilateral approach, as it did in the run-up to the Iraq conflict. In the aftermath of the Iraq war, it is beginning to wake up to the need for help, but by not preparing the ground beforehand, it has done a lot of damage. I am concerned that, given its over-involvement in Iraq, there is a danger that for domestic political reasons the USA will disengage too quickly and in the wrong way, and having gone so far will leave behind more damage than it sought to remedy.

Given the Government's engagement with the USA, they face a real challenge on world trade, on multinational issues and on Kyoto. They must say to America that we all live on the same planet and that we all interact with each other. Economically, it is better to open up trade so that we all get the best products from

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those most able to produce them at the best price, and we can all then produce, in our own countries, what we are best at. In that way, we maximise the growth potential of all countries to our mutual benefit.

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