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Mrs. Alice Mahon (Halifax) (Lab): The Prime Minister will be aware that the senior Shi'a cleric Ayatollah Sistani is calling for early elections instead of an appointed Government in Iraq. Many supporters of early elections believe that the World Food Programme could be used to organise such elections. The Prime Minister said this afternoon that he thought the best thing for the Iraqi people was democracy and freedom. Will he therefore give them the right to those early elections?
The Prime Minister: It is important for us to make progress as quickly as possible. I think people understand that after years of Saddam there is a process
that must be gone through—but yes, of course we want democratic elections as swiftly as possible: I echo my hon. Friend's call for them. I cannot forbear to point out, though, that if Saddam were still in power there would be no question of any elections.
Mr. John Redwood (Wokingham) (Con): Will the Prime Minister explain why he is prepared to give away more powers over foreign affairs, economic policy, asylum and immigration and many other important issues when it is crystal clear that none of those things is needed for enlargement, contrary to his original opinion?
The Prime Minister: For enlargement to work effectively, it will be necessary to make changes. For example, I believe that qualified majority voting would be in the interests of the country for a series of subjects. However, we are not giving up the power to set our asylum laws—that is simply not true. As a result of our negotiations at the time of the Amsterdam treaty, we are not giving up the right to independent foreign and defence policies. Of course we shall not give up any such rights.
It is right to work with others in the European Union because a Europe of 25 needs a different way of working. Let me give one example. We currently have rotating six-monthly presidencies, which make it difficult to achieve continuity in the agenda that the member states adopt in the European Councils. If we do not have a full-time chairmanship, a series of states—possibly small states, one after another—will preside and it will not be possible to make the European Union work effectively. That is why it is ultimately important to make changes. However, we have said before, and I say again, that we shall not yield any of Britain's essential attributes as a nation state.
Tom Levitt (High Peak) (Lab): My right hon. Friend is right to draw attention to the commitment to Europe of not only the Polish Government but the Polish people. Poland does not regard itself as the heart of Europe for nothing.
However, is my right hon. Friend aware that since the largest accession country fought a referendum campaign in May based on a specific voting strength, it is dismayed to find that it has to accept a lesser voting strength the following May? How does he believe that that could be resolved?
Will my right hon. Friend also take the opportunity to pay tribute to Polish troops who played such an important part in the coalition in recent months?
The Prime Minister: Let me pay several tributes. First, I pay tribute to the Polish troops for their magnificent work in Iraq, where we work closely with Poland's immensely fine soldiers. Secondly, I pay tribute to the courage of the Polish Prime Minister for attending the summit after a serious accident. He showed enormous stoicism.
Thirdly, my hon. Friend is right. Poland's difficulty was not with the vast bulk of the constitution, with which the Polish Prime Minister agreed, but with the specific element that Poland had secured as an agreement at Nice. What was on offer for Poland in the
Convention appeared less good to the Prime Minister and that was obviously difficult for him to accept. We must therefore pause and reflect on a possible way forward. As was implicit in my hon. Friend's remarks, if we base British negotiating strategy on blanket opposition to the constitution by other countries, we base it on a serious misapprehension.
Angus Robertson (Moray) (SNP): There is genuine relief in our coastal communities that we will not have a constitution that entrenches the conservation of marine biological resources under the common fisheries policy as an exclusive European Union competence. The Prime Minister spoke repeatedly of national interest, but he and the leaders of the Conservative and Liberal Democrat parties did not mention the fishing industry once. Is that because it is not a matter of national interest for the UK or the UK parties?
The Prime Minister: It is important to ensure that we secure the right fisheries deal for all parts of the UK. Important negotiations are taking place this week. However, as I have said to the hon. Member for Banff and Buchan (Mr. Salmond), the hon. Gentleman's party leader at Westminster, it would not be wise for us to withdraw from the common fisheries policy because that would mean a free-for-all.
Mr. Stuart Bell (Middlesbrough) (Lab): The Prime Minister consistently referred to the defence issues that were discussed at the conference, and the transatlantic and European alliances. Will he confirm that the military planning centre that has been set up for a limited goal of humanitarian and peacekeeping aims does not need to be covered by the treaty, will be up and running and will form an appropriate bridge between the two alliances?
The Prime Minister: Yes. Moreover, as my hon. Friend rightly implies, there is no standing operational capability. That was one of our agreements. However, it is important that, in circumstances in which America does not want to be engaged and NATO assets are not
used, Europe has the capability to act. We have only to consider events in Macedonia to realise how sensible it is for Europe to have such capability in limited circumstances and when NATO is not engaged. European defence is therefore sensible, provided that it proceeds only when it is strictly complementary and does not duplicate NATO's actions.
Mr. John Wilkinson (Ruislip-Northwood) (Con): Why did the British Government not oppose the proposal by the French and German Governments that the EU should lift its embargo on arms sales to the People's Republic of China? That proposal was encouraged by Mr. Prodi, who welcomed such a review. What military threat do the Chinese face that could be seen off with weapons from Europe? Is it perhaps the possibility of a referendum on Taiwanese independence?
The Prime Minister: I think that it is perfectly sensible to review the embargo. The situation in China today is different and changing: the suggestion that we should reconsider it is sensible, and was not put forward for the reasons that the hon. Gentleman states.
Jane Griffiths (Reading, East) (Lab): The capture of Saddam Hussein is welcome for Iraq, for the middle east and for the whole world, but is the Prime Minister in a position clearly to tell the House whether he believes that Saddam Hussein should be indicted for war crimes or on other charges?
The Prime Minister: The precise nature of the indictment that is made against him should, as I say, be left to the Iraqis. I emphasise that Iraq has a governing council, whose members said just a few days ago, before the capture of Saddam, that they wanted to set up a special tribunal to try people who were accused of various crimes against the Iraqi people: they should be allowed to get on with that process. We should give whatever support we can in ensuring, for example, that the judiciary is properly independent and properly staffed. The terms of the indictment and the way in which any charges are framed are for the Iraqis themselves—that is part of the whole process of saying that Iraq is run by the Iraqis.
Orders of the DayCONSOLIDATED FUND BILL
Order for Second Reading read.
Question, That the Bill be now read a Second time, put forthwith, pursuant to Standing Order No. 56 (Consolidated Fund Bills), and agreed to.
Bill accordingly read a Second time.
Question, That the Bill be now read the Third time, put forthwith, and agreed to.
Bill accordingly read the Third time, and passed.
Child Trust Funds Bill
[Relevant document: The Second Report from the Treasury Committee, Session 2003–04, on Child Trust Funds, (House of Commons Paper No. 86).]
Order for Second Reading read.
4.31 pm
The Financial Secretary to the Treasury (Ruth Kelly): I beg to move, That the Bill be now read a Second Time.
I am delighted to bring this Bill before the House. In doing so, the Government are fulfilling a manifesto commitment. The child trust fund represents a new and imaginative way of encouraging children and their parents to save for the future. We will ensure that, in future, all children will have the opportunities that are currently taken for granted by only a few.
There are four key objectives for the child trust fund: to help people to understand the benefits of saving and investing; to encourage parents and children to develop the savings habit and to engage with financial institutions; to ensure that in future all children have a financial asset at the start of adult life; and to build on financial education. This is an ambitious and long-term project. Nothing on this scale has been tried anywhere else in the world. Britain is leading the way in asset-based welfare, and we are convinced that that is the right thing to do.
The Government have already taken important steps towards ending child poverty. Only last week, the Chancellor announced an additional £1 billion a year of investment in Britain's children to advance our goal that not some, but all of them should have the best possible start in life, and that no child is left behind.
Welfare policy cannot however be seen merely as the meeting of immediate needs. It is time to take a longer-term view and to consider the wider factors that make a difference to young people's future opportunities. Evidence from the national child development survey suggests that the backing of a financial asset can have a significant impact on changing people's attitudes and broadening their horizons.
We want all families to have the opportunity to save for their children. Surveys show that only one third of the population saves regularly. Moreover, there is no tradition of people saving money for their children over the long term. We hope that the child trust fund will kick-start saving among families, and we believe, for two reasons, that that will be achieved—first, as a
response to the initial Government payments and later age-related payments; and secondly, as a result of financial education.We are particularly concerned about families on low incomes. The American experience with individual development accounts shows that incentives encourage people on lower incomes to save money, and our own pilots of the savings gateway—the interim report on which was published last week—show that people on very low incomes can make regular savings. That, too, was the conclusion of the financial services industry and of consumer groups. Recent research conducted by the Association of British Insurers found that 75 per cent. of parents who do not normally save for their children said that they intended to contribute to their child's trust fund. The National Consumer Council's research into the attitudes to saving of people on modest incomes in the 21-to-35 age group suggested that spontaneous references were made to the new fund by the participants.
We recognise, however, that it will be harder for families on low incomes to make contributions, and that is why the Government have decided to make an additional contribution to the accounts of those children whose parents are in receipt of the full child tax credit and whose income is below £13,230. The child trust fund is a good example of progressive universalism. It is a universal policy reaching out to all children, no matter what their financial circumstances, but it will target more resources on those children who need it most.
I welcome the conclusion of the Treasury Committee report published today, which says:
- "The Child Trust Fund is an ambitious, pioneering programme which seeks, through a significant long term investment by the Government, to provide a financial asset to all children when they reach the age of 18, and to change people's behaviour towards saving. Whilst those with higher income may make most use of the opportunity, we feel that this gives less well off families an unprecedented chance to build up a tax-free sum for their children."
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