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4.5 pm

Mr. Tom Clarke (Coatbridge and Chryston) (Lab): If the hon. Member for Banff and Buchan (Mr. Salmond) will forgive me, I think that he answered his own question at the end of his speech. The fact is that the Scottish people have never voted for independence, so as a Member of this United Kingdom Parliament, I hope to make the speech that I had planned to make when I sought to catch your eye, Mr. Deputy Speaker.

The sections of the Queen's Speech that have been substantially addressed by the Chancellor of the Exchequer and my colleagues—on economic stability and growth; on the need to press for a fairer trade system as part of the current round of world trade negotiations; and on the achievement of the millennium development goals, including increased aid flows and effective debt relief for developing countries committed to reform—are extremely relevant. However, it would not be possible to address those matters were it not for the huge success throughout the whole of Britain of the Chancellor's economic policies: successes in employment, inflation, mortgages and growth. Because of those successes—and because the Chancellor has had the courage to deal with the issue of resources, and to say that there are times when they should relate to reform—I hope to address several matters in the short time available.

The Chancellor has given the lead at home and abroad. When my right hon. Friend the Member for Llanelli (Denzil Davies) and my hon. Friend the Member for Coventry, North-West (Mr. Robinson) referred to globalisation, they seemed to recognise, as did the Chancellor, that he has approached the economy and the demands placed on him in the knowledge that this is a rapidly changing world in which the issue of globalisation is indeed extremely relevant, and must be addressed. His policies on international development—including increased aid, debt relief and his emphasis on HIV/AIDS—are extremely important in a modern and caring world. I believe passionately that the model that he has set out could be emulated not only by G7 and G8 countries, but by developing countries as well.

As we look to the developing world, we see the influence of Britain's economic policies and of the activities of the various Government Departments. If the considerable assets that many developing countries undoubtedly possess—such as huge oil reserves, massive gas supplies, and diamonds and other mineral resources—are not used to benefit the poorest people in the poorest countries, we will have met with spectacular failure. Oil, gas and mining industries are now significant in more than 50 developing countries, but 1.5 billion people in those very countries continue to live on less than $2 a day. Twelve of the world's 25 most mineral-dependent states and six of the world's most oil-dependent states are classified by the World Bank as heavily indebted poor countries, with among the world's worst human development indicators. That calls for transparency, accountability and fairness at every level.

That transparency must involve national Governments, including ours, international companies and those involved in commerce, and international institutions such as the World Bank, the International Monetary Fund, and the United Nations. I believe that

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I speak for many aid agencies and non-governmental organisations when I say that we ought to be forming that strategy now.

It is not difficult to understand why. For example, Africa's oil boom comes at a time when foreign aid to that continent from industrialised countries is falling and being replaced by an emphasis by donor nations on trade as a means whereby African countries can escape poverty. The dominance of oil and mining in Africa's trade relationships, coupled with the decline in aid flows, means that it is vital that Africa makes the best use of oil and other natural resources.

The international oil companies must accept their responsibilities as well, although it has to be said that I see little evidence of the self-regulation that some of them commend to us. Northern Governments such as that of the United States and the United Kingdom are beginning to acknowledge the need to address the perils of oil development, but their actions, although welcome, are not enough.

As we address those issues, seeking to attain stability is of paramount importance. I have recently been to the Democratic Republic of Congo, and I realise that there, petroleum has become a magnet for conflict, and in some cases even civil war, imposing even more poverty where it is least welcome.

The primary responsibility for managing mineral wealth and ensuring transparency lies with the developing countries. Oil riches should benefit the many, not the few. It cannot be right that corruption, mismanagement, environmental destruction, human rights violations and conflict should go unchallenged—although there are examples of good practice, and it is right to say so. For example, the Chad-Cameroon pipeline project is the biggest international effort to date to focus an oil development project on a poverty reduction outcome. There is great confidence that by 2004, the budget anticipated for that year will show that oil revenues in Chad have more than doubled. Botswana has, by and large, put its diamonds to good use, and has sought to address the essential elements of poverty.

However, there is another side to that picture. It cannot be acceptable that in Angola there is so much wealth together with so much confidentiality, despite the challenge that BP, to its credit, has made. The rich north has its responsibilities too. Although we may increase our aid to developing countries, those sums are dwarfed by what we give to agricultural industries.

Mr. Gardiner: My right hon. Friend is widely respected in the House for his knowledge of development matters. Does he agree that the Paris Club consideration of the sovereign debt of Iraq, which is deemed to amount to more than $200 billion, is vital? Does he also agree that it is important to press for the more beneficial Evian principles on debt forgiveness if that country is to pull itself out of its terrible situation? Will my right hon. Friend support the early-day motion, which calls on the other four creditor countries—France, Russia, Germany and Japan—to be more forgiving in their approach to this matter?

Mr. Clarke: I am grateful to my hon. Friend for his intervention. He will forgive me for being a little canny on early-day motions: I like to read them before I sign them. Otherwise, he made extremely valid points, and I am sure that the House will recognise them as such.

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I was making the point that, although I support the Government's policies on overseas aid, it is also appropriate to examine what is happening with the common agricultural policy, and I welcome the Government's initiatives there. It is also appropriate to point out that in comparison with the figures that I supplied earlier of $300 billion on agricultural subsidies, $600 billion is being spent on defence. It is surely right to try to set our priorities on such matters.

I believe that the British Government have given a commendable lead. The Chancellor, in particular, has led G7 and G8 talks on the debt crisis and other matters. I welcome what is happening to the common agricultural policy, which is a challenge to us all. I welcome the overhaul of the EU aid budget and our attempts to change it. I congratulate the Chancellor on his international finance facility and I wish the Government every possible success on all those matters. The Government have a record since 1997 of which we can be extremely proud.

4.16 pm

Mr. John Butterfill (Bournemouth, West) (Con): I shall confine my remarks to the proposed pensions Bill, which may not surprise hon. Members, and I should like to declare my interest as chairman of trustees of the parliamentary contributory pension fund and chairman of trustees of the People's Dispensary for Sick Animals pension fund and as a section 226 policyholder. I shall refer to those policies later.

I start by referring to the pensions protection fund. In principle, it is probably a good idea, which should be welcomed—but the devil will, as always, be in the detail. The proposal to have a flat rate topped up by a risk-based premium is entirely appropriate. Otherwise, there would be moral hazard and people with badly funded schemes would benefit from those with well-funded schemes. The Association of Consulting Actuaries conducted a survey and found 58 per cent. support for the proposal, but 64 per cent. of respondents said that a £15 contribution per member was too high. PricewaterhouseCoopers, however, has determined that in the light of what the Government actuary proposed, the appropriate level for funding the White Paper proposals would be £50.

I do not believe that £50 per member is wholly disproportionate, as it amounts to about £1 per week for a member of any private pension scheme. I would have thought that anyone in such a scheme would feel that it was quite good value to have a guarantee for £1, and I hope that that is the mechanism that the Bill will produce. It will, of course, vary from fund to fund and the less-well-funded schemes might find that they needed to raise more than £1 a week per member. Will the Government tell us who will audit the schemes to decide what the premium should be? Will it be left to the scheme actuary or will independent checks be made on what the premium should be? I agree that a cap is necessary on income and that £40,000 to £60,000 is probably not unreasonable, provided that the cap is indexed in accordance with incomes rather than with the cost of living.

We can learn some lessons from what has happened in the United States where there has been a similar fund for many years, from which the Government have drawn much inspiration. The US scheme is similar in

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that it is self-financing and there is no Government guarantee, which is, I understand, our Government's position. Interestingly, there are two types of scheme in the USA: the single-employer scheme, which had a deficit of more than $3 billion by the end of 2002, and the multi-employer scheme, which had a small surplus. That may be a lesson for us. Multi-employer schemes, which the Government would need to facilitate, may be more prudentially managed than single-employer schemes, so perhaps we should look into that. We should take cognisance of the comments of Steven Kandarian, the executive director of the US scheme:

More than 50 per cent. of members of the National Association of Pension Funds support the proposals, but 50 per cent. also say that they will make defined-benefit schemes less attractive for employers. Almost 50 per cent. think that the Government should fund the whole thing and that there should be no levy on NAPF members. The association suggests a benefit limit rather than a salary cap, but asks how the schemes will be inflation-proofed, how the costs will be estimated and how the risks will be assessed. The NAPF has also asked how such schemes would deal with early retirement due to ill health and whether they would affect the priority orders that the Government are—rightly—proposing to introduce.

Most people support the schemes, but it will take time for employers to introduce them and employment contracts may need to be renegotiated, so 2005 looks a little optimistic, although the Government would have then had eight years to introduce the reforms. That seems rather a long time; there has been an awful lot of consultation and it has taken an awful lot of time.

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