UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 709-ii

House of COMMONS

MINUTES OF EVIDENCE

TAKEN BEFORE

LIAISON COMMITTEE

 

 

THE PRIME MINISTER

 

 

Tuesday 7 FEBRUARY 2006

RT HON TONY BLAIR MP

Evidence heard in Public Questions 180-313

 

 

USE OF THE TRANSCRIPT

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Oral Evidence

Taken before the Liaison Committee

on Tuesday 7 February 2006

Members present

Mr Alan Williams, in the Chair

Mr James Arbuthnot

Mr Kevin Barron

Mr Alan Beith

Mr John Denham

Mr Andrew Dismore

Mr Frank Doran

Mrs Gwyneth Dunwoody

Mike Gapes

Mr Jimmy Hood

Mr Michael Jack

Mr Edward Leigh

Peter Luff

Andrew Miller

Mr Mohammad Sarwar

Mr Barry Sheerman

Dr Phyllis Starkey

Mr John Whittingdale

Mr Phil Willis

Dr Tony Wright

Mr Tim Yeo

Sir George Young

________________

Witness: Rt Hon Tony Blair, a Member of the House, Prime Minister, gave evidence.

 

Chairman: Welcome yet again, Prime Minister, to the eighth session. There has been speculation, of which I am sure you are aware, but I assume that we can expect to at least see double figures together in these meetings! As usual, there are three themes and you have been notified of those in advance and, as everyone knows, you are not told the questions. Today's three themes are, firstly, the outcome of the UK Presidencies of G8 and EU; secondly, the Government's reform agenda, primarily health and schools; and, finally, relations with Iran and the impact of the electoral outcome in Palestine. So it is a rather heavy programme and we will move straight into the questioning and start with John Denham.

Q180 Mr Denham: Prime Minister, looking at the outcome of the UK Presidencies, a major issue in the past year and for you personally is climate change. It is true to say, is it not, that even if all of the agreements that were reached in the last 12 months were actually implemented in full and on time, they would not begin to match up to the scale of the problem that the world is now facing?

Mr Blair: Absolutely. We have got to do a lot more. The most important thing about the last 12 months is that at long last we have a process in which America, India and China are coming together as part of an international dialogue, hopefully, to set a post‑Kyoto Protocol framework for the years following 2012, but even if we implemented Kyoto it would only stabilise greenhouse gas emissions, it would not reduce them by the amount we need to reduce them.

Q181 Mr Denham: The scientific consensus, and I think this was reflected in the report produced for you last week, is that, unlike many other issues, there is a point with climate change where no action we take would be able to reverse the processes that we have set in train. How long do you think personally, knowing the evidence as you do, that governments in the world have got to take and implement the necessary decisions so that we can be confident of avoiding that tipping point?

Mr Blair: That is a good question. I think that if we do not get the right agreement internationally for the period after which the Kyoto Protocol will have expired, that is 2012, if we do not do that, then I think we are in serious trouble.

Q182 Mr Denham: So you would say then that really within the next seven years critical decisions have to be taken and implementation started?

Mr Blair: Yes, and I think that the only way we are going to get that agreement is if America and, as I say, China and India are part of the deal. I think the good news is that everybody even if they are coming at it from different angles - and the Americans will stress security of supply rather than climate change; the Chinese and the Indians are very, very concerned about their economic development for obvious reasons - but from whatever angle people are coming, I think there is the beginnings of an international consensus. I am not overstating it; it is the beginnings. We have to then make sure that we agree both the overall framework and the measures in order to get there.

Mr Denham: Thank you, I think that is a statement that will focus a lot of minds.

Q183 Mr Jack: Prime Minister, you have very much put your own personal imprint onto the climate change agenda. In your response to John Denham's question you indicated the worth after the recent Gleneagles Summit of getting the Americans, the Chinese and the Indians on board. You have regular contact with President Bush, either personally or by videophone or in telephone conversations. When did you last speak to him about the climate change issue in the follow‑up to Gleneagles?

Mr Blair: It is a continual part of our dialogue, virtually the whole time. That is partly because you have got a G8 summit that is coming up with Russia hosting it. Obviously I talked to him, too, about his State of the Union address just ten days ago. Look, my assessment of the situation is this: that America is very wary, for understandable reasons, of having some external target unrelated to their economic growth pushed upon them from the outside. That is their concern and their worry. On the other hand, I think they can see the evidence as much as anyone else and there are real issues to do with security of supply. I cannot myself remember the last time the President's State of the Union Address had a headline out of it about the American addiction to oil. I think there are real signs of change and, of course, as I was saying, the fact that Russia is going to concentrate its G8 summit on energy will be interesting for all sorts of reasons but will obviously give us an opportunity to go back into this issue.

Q184 Mr Jack: But in your regular discussions with President Bush, have you discussed any specific way in which the United States can become engaged in the post‑Kyoto programme beyond the encouraging noises coming out of the State of the Union message? For example, have you talked to President Bush specifically about what would have to happen to have an international emissions trading system in which the United States would want to participate?

Mr Blair: The whole range of discussions, including what type of systems, emissions trading systems, whether you can have targets or not, is part of the discussion the entire time. It is fair to say that America has got a very clear position at the present time on this, but I think if we could find a way of ensuring that the right incentives were given without America feeling there was some desire to inhibit its economic growth, then I think we can find a way through. There is no point in me speculating on the American position until the conversations and discussions have concluded. My own view, as I say, is that they have moved a long way in the past couple of years, but obviously I and many others want to see America move much further.

Q185 Mr Jack: Have you actually in your conversations with President Bush got any feeling that he wants to personally and specifically move the agenda forward? The State of the Union message was very good in potentially providing, if you like, a technological way out of engaging with the greenhouse gas issue and actually being able to demonstrate you are doing something about it. When the President's own adviser on science will not talk to the President, as I understand it, about greenhouse gas emissions, whereas the Department of Energy takes a rather different view, I wonder just how united the American position is.

Mr Blair: Obviously I do not know what you mean by his adviser, but I think this debate is continuing the entire time. Look, in the end what is necessary to get a climate change deal is to have a framework of incentives so that the private sector together with the public sector develops the science and technology that is necessary for clean energy. It is only going to come through that science and technology being developed. One thing that is absolutely essential in this area, in my view, is to dispose of a lot of the nonsense that simply points the finger at America and says America is the only problem in relation to climate change. Let us be quite clear, we are one of only four countries, I think, in the European Union that is going to hit their Kyoto targets. China and India are not yet part of any binding framework. It is not surprising that America ‑ and let us be clear the Europeans are pretty much in the same position ‑ is going to say that any future framework has to involve them as well. When we take account of the fact ‑ and it is not my job to speak up for the administration ‑ that America spends more on clean energy technology than any other country, I think it is just as well to put that in the mix when we come to analyse who is doing what. However, to state it again, in my view, this can only be done if you have a framework in the end that has targets within it. If you do not get to that point then the danger is ‑ and I have discussed this with a lot of American private sector companies ‑ you never have the right incentives for the private sector to invest heavily in clean technology, so the question is how do we get from here to there? I am not saying that Gleneagles has started anything more than a dialogue but for the first time that is a dialogue that is happening ‑ and Montreal took it on further ‑ with America, China and India involved, and if they are not involved, then this is what I keep saying to people about the UK, obviously it is important we do our bit but, let us be clear, whether the climate changes or not is not going to depend on the UK. It is dependent on those huge economic motors and in particular China and India ‑ China has a new power station every week or every two weeks ‑ if we cannot develop the science and technology and then transfer it to them, we can make whatever agreement we like here or in Europe, it is not going to do the trick in the end.

Q186 Andrew Miller: That is absolutely right, Prime Minister. The consumption of energy by China and India is in direct correlation obviously to their huge economic growth. Climate change is therefore an enormous priority just because of those countries alone, and you have mentioned it several times. What discussions have you or your ministers had directly with the Chinese and Indian administrations about the specific technologies of carbon capture and nuclear power?

Mr Blair: I have discussed both of those technologies with both the Indian and the Chinese leaderships, most notably last September when I was in both countries. Again, I think that the good news is that the Chinese and the Indians are very, very anxious to find a way of growing sustainably. The trouble is, as both the leaderships pointed out to me, each of them has several hundred million people living in severe poverty, economic growth is the answer to their poverty, and they cannot have an artificial constraint on their economic growth, particularly, as they say, "You guys have grown in the Western world and now you want us to dampen our growth." That is not going to work. That is why I say the only realistic thing is to get the framework to develop the technology and then to spread the technology. For example, Europe has agreed now with China that we will build a clean coal plant. With India and China obviously there are discussions on nuclear power because India and China are both building new nuclear power stations and they have been, I think, more enthusiastic in terms of both the Gleneagles and Montreal dialogue than people expected, and although obviously you always want to go further in these circumstances, a lot of people thought prior to Gleneagles you would never get a G8 Plus Five dialogue going specifically on the climate change issue; we have got it going. The key thing however, as I say, over the next few years is to take those discussions to the point where you get a framework, the investment goes in to develop the technology, and there are mechanisms for spreading that technology to China and India, in particular.

Q187 Mr Denham: Prime Minister, a few minutes ago you gave a very tight timetable, seven years or so, to get key decisions implemented. A year ago you asked this Committee how many politicians facing a potential election at some point in the not‑too‑distant future would vote to end cheap air travel. Is not one of the problems, Prime Minister, that you are quite pessimistic about the ability of politicians to persuade the public that we do need to make changes in the way we live our lives?

Mr Blair: Whether I am pessimistic about the politicians --- maybe that is not a wise sentence to finish! I think that you have just got to be realistic about this. I think that the answer is to develop, for example with the motor vehicle fuel cell technology, more environmentally sustainable ways of aviation travel. I think if you get into the point of trying to agree ‑ and it would have to be done again on a multilateral basis because there is no point in us preventing British people getting on planes - I just think it is unrealistic to think that you will get some restriction on air travel at an international level, and therefore I think necessarily the best way to go is to recognise that that is just the reality and instead see how you can develop the technology that is able to reduce the harmful emissions as a result of aviation travel. For example, the big new Airbus because of the technology used in its construction, I think, burns something like 30 per cent less fuel. All I am saying is in the end, in my view, that is the way the argument will go and of course the fact is, and this is why I would like to see a significant uplift in investment in this type of technology, if we were really putting in the investment into carbon sequestration, into developing the best forms of renewable energy, then I think we could find the savings (because I think there is an answer to this) reasonably easily.

Q188 Mr Yeo: Just staying with aviation for the moment though specifically, emissions from international aviation for the last published year (2004) rose by 12 per cent and they have more than doubled since 1990, and they are really out of control now. Is not relying, as the Government seems to be doing, on including aviation within the EU Emissions Trading Scheme a hopelessly inadequate response to the one factor which could derail the whole international approach to climate change?

Mr Blair: Well, I do not think it is an inadequate response. I think it is important and again the struggle to do it indicates that some people are not very keen on doing this, but I think putting it as part of the emissions trading system is a very important first step. All I am saying, Tim, is that I will wait and see it, but, if you really want to impede air travel, to cut it back significantly, for example, through some taxation mechanism, it would have to be a fairly hefty whack. I know we are all undergoing periods of policy change in this area, but I will await it with interest.

Q189 Mr Yeo: But waiting and seeing, I think in your own words in the foreword to the Extra Report, is exactly what the world cannot do. Here we have one factor, as I say, which is actually threatening to increase emissions at such a rate that it is out of control. Now, emissions trading for aviation is hideously complex and the target for trying to include it half way through perhaps phase two of the EU's scheme looks extremely ambitious, given the complexity. From what you have just said, it appears that really it is a matter of hoping for the best here rather than actually having any specific policy to address this very real problem.

Mr Blair: No, because I think you do have both the means to develop the actual frame of the aircraft so that it uses less fuel and also of course there is research going into better forms of aviation fuel. Now, all of that is important and all I am saying to you is, and I am happy to listen to any suggestions, but I cannot see myself that you are going to be able artificially, through mechanisms based on the consumer, to interfere with aviation travel. I just cannot see you would get international agreement to that effect and I would certainly worry about putting some special levy on people in the UK because I do not think it would be very sensible.

Q190 Mr Yeo: Hang on a minute. That is just exactly what we could consider. I can see that, for international flights, it is very difficult, but there is nothing to stop either the EU or Britain alone or Britain acting bilaterally with another EU country from introducing some form of tax or charge on flights or on aviation fuel for those flights and that would be to use the price mechanism which in most other areas we think is a good way of sending signals on climate change into this area. It would be much faster than the technological improvements which you have referred to, which may come into effect a decade or so from now, and it would address the problem immediately. Why have we not considered that?

Mr Blair: Well, because I think, in order to make a real difference, it would have to be pretty hefty and I cannot see myself that we would be in a position to say to the British consumer, even if you did it on a bilateral basis, "This is worth your while because of the impact on overall climate change". I just think it is one of these things where in the end let us just face the reality and the reality is that, unless we get an international agreement and you are developing, as I say, the science and technology at an international level and then spreading it, you can end up taking measures that may harm your own economy without actually helping the issue of climate change. That is why I think we have got to be extremely careful of the measures that we take here. It is why I think you need a certain amount of flexibility. As I say, I am happy to listen to any suggestions that people make, but, if you really wanted to stop people travelling, be clear, it would be a pretty hefty whack you would have to put on travel within the UK or between the UK and another country and I will wait to see who first proposes it.

Mr Leigh: Well said!

Q191 Mr Yeo: Well, you could say that, if it is not hurting, it is not working.

Mr Blair: Yes, there was a politician who said that, I think!

Q192 Mr Yeo: I thought you might remember!

Mr Blair: I am not quite sure what happened to him!

Q193 Mr Yeo: But the fact remains that actually it does mean a pretty hefty pricing on it if it is to make any difference at all. If there was a cross-party consensus on this, then would that make a difference?

Mr Blair: Well, I have a feeling that intra-party consensus looks a little troublesome. To be serious, the problem is this, and I watched this debate very carefully and went through all the Kyoto negotiations, but there are two things that can be done in this are. One is very important, symbolic actions, and I think we have got to look, for example, at how we make it easier for people themselves to take action in their own lives and their own lifestyle in order to help the environment, but I think one has to be very realistic, that you are almost making a point by doing that. Then I think there is a really hard-headed analysis of what this climate change issue is and who can affect it. When you come to that hard-headed analysis, that was always my problem with Kyoto, that, if it did not involve America and it did not involve binding targets on China and India, then my worry was with Kyoto, all the way through, though I fully support it incidentally and, as I say, we will meet its targets, but my worry was that it was not dealing with the three great engines of climate change and greenhouse gas emissions and, therefore, I think, if we want really to deal with this, you cannot deal with it other than at an international level and by the means I have described.

Q194 Dr Starkey: Prime Minister, can I turn to an area of UK domestic policy where we could do something about climate change and where the technology is already available, and that is the area of domestic housing which contributes 27 per cent of our carbon emissions. Why has the proposed Code for Sustainable Building been watered down so that it does not apply to commercial buildings at all and it is only proposed that it should be voluntary for market housing, although it is mandatory for social housing? Are we not missing an opportunity here to provide leadership?

Mr Blair: I think the idea, through the Code, is indeed to provide incentives for people when there is new build and to make sure that we incorporate sustainability into that. I was not aware that we had watered down all the aspects of that. I thought we had still made it clear within the Code that actually we expect certain criteria to be met in order for new build to take place. I would also say incidentally in respect of public sector buildings, and of course there is a big hospital- and school-building programme, we are examining now how we build environmental sustainability into the criteria for that build too.

Q195 Dr Starkey: Well, important though it is to have environmental sustainability in social housing, market housing is the majority and there are already clear differences in design standards, for example, where ----

Mr Blair: Have we taken them all? I thought we had still left certain criteria in there.

Q196 Dr Starkey: The Code is there, but it is not mandatory and all the experience in the existing growth areas with design standards, for example, is that the private sector chooses not to follow those design standards, so you will have social housing of high-quality design and next door you will have poor-quality design, private housing, so all the evidence is that you will have the same thing over the Code for sustainable housing. It will be followed for social housing because it is mandatory for that, but the private housing will not follow it and that will mean that that new housing will be less environmentally friendly. Given that the Government's own figures demonstrate that it only adds a cost of £608 per house, which is more or less insignificant, why is the Government missing this opportunity to make the Code mandatory and send a strong signal?

Mr Blair: Can I come back to you on that specific point because I had thought the position was a little more nuanced than that, but let me come back to you specifically on that.

Dr Starkey: Thank you very much.

Q197 Mr Jack: Prime Minister, one of the interesting questions is that you have not appointed a Minister for climate change, somebody who is obviously in charge. When I looked across the spectrum of departments which have a finger in this pie, you have, for example, Defra which is pursuing the environmental agendas, biofuels, making an effort to reduce the greenhouse gas emissions, but you have the transport sector where the reverse is occurring and you have arguments between, seemingly, Defra and the DTI and you have the Treasury, for example on biofuels, trying to stimulate a UK industry, but without a lot of success, through a concession on taxation. Just who actually is in charge in the UK of the climate change agenda? Are you in charge?

Mr Blair: Well, there is an Energy and Environment Cabinet Committee which I chair and, you are right, there are different departments with different responsibilities, but our position on climate change, and indeed on the Government's response to it, is done through the Cabinet committee process and I think, by and large, they actually do more or less work together on it. For example, in respect of Kyoto and in respect of Gleneagles and Montreal, I think we have got a pretty well worked-out position that generally is considered a fairly leading position in the world. Obviously there are always going to be clashes in this because those who are looking at it from an environmental point of view and those who are looking at it from an energy point of view may come to a different conclusion. There are obviously differences between transport and the environment and again, even within the energy sector, there are issues to do with, "If you want to have clean energy, what's the best way of getting it? Is it to have more renewables? Is it putting nuclear on the agenda?" and so on. To be honest, I think that is inevitable. You are not going to have one person who is going to be able to do all of that, but we do bring it together in the Cabinet Committee and, by and large, I think that process works reasonably well.

Q198 Mr Jack: Defra are due to be producing their own review of the UK's Climate Change Programme. Will that document come before the Committee that you are chairing and, if so, when?

Mr Blair: Yes, it will. I do not know exactly when, but I have a meeting, I think, coming up with the Committee in the next couple of weeks.

Q199 Mr Denham: Prime Minister, thank you for those answers. Can we move on to the European Union, the Presidency there. In a speech last week, I think you expressed a bit of frustration that expectations about what can be achieved in the six-month Presidency were too high. In June, you told the European Parliament, "The people are blowing the trumpets round the city walls...The people of Europe are speaking to us...They are wanting our leadership. It is time we gave it to them". Can the people put their trumpets away?

Mr Blair: No, absolutely not, but I think there is a change, as I described in my speech, a change of mood towards reform and I think we have a Commission more openly committed to economic and regulatory reform than any Commission before it, and President Barroso is someone who kind of embodies that spirit, and I think, both at Hampton Court and in the budget reform process that was agreed in December in Brussels, we have the opportunity to take forward this agenda. No, I think it is important that we keep up the pressure.

Q200 Mr Hood: Prime Minister, can I just comment on, and invite you to comment on, enlargement. The UK has long championed enlargement, but there appears to be some enlargement fatigue in some Member States at present. How many new members can the EU take with its current institutional structure?

Mr Blair: Well, I think it is very difficult for Europe to operate effectively at 25 with its present institutional structure, in particular, a revolving six-monthly Presidency. However, having said that, I think enlargement has done Europe a power of good and I think that there is a major, major question for Europe and for people in Europe to decide, and that is really about whether we are an open Europe, both economically and in terms of openness to enlargement, or whether we are a closed Europe, and that is essentially the battle that is going on. As I say, I think that it is being won by the reformers, but that is the battle that is there. I think you are right in implying that it is difficult at 25. Already you can tell, when you go to a European Summit with 25 people sitting around the table, each with their own national interest, that it is very hard, unless there is massive concentration by the Presidency in the run-up to the Summit with a lot of expertise and resource, for the thing to be properly handled.

Q201 Mr Hood: A safeguard clause has already been introduced for Bulgaria and Romania. Do you see the need for a similar, tougher approach with Croatia, Turkey and the Balkans, and what about Ukraine?

Mr Blair: Ukraine is obviously in a different position from the others. We have opened accession negotiations with Turkey and Croatia and they will be judged according to the criteria. Bulgaria and Romania will come in, provided they meet the criteria, but I think you are right and, look, there is a mood in Europe about enlargement that is not altogether positive, but I think it is important that we try, with other allies, to turn that around.

Q202 Mr Hood: What is the UK response to these initiatives coming from the Austrian Presidency, supported by the European Parliament, about looking at revisiting and resurrecting the Constitutional Treaty?

Mr Blair: I think most people are pretty realistic about this. We have had two noes in Europe from France and Holland and, unless those are reversed, that is the position. We have already agreed that we will revisit this issue, but I said in my speech last Thursday, and I think others have been saying in Europe as well, "Let's not return to focusing on that exclusively". That is an issue about the rules that govern the European Union, but actually our main priority is to carry through the reform agenda, economic liberalisation, these issues like energy policy, for example, which in fact should be a far bigger part of the European agenda, what we can do in common defence and foreign policy, and of course the budget reform process that will take place in 2008/09.

Q203 Mike Gapes: Prime Minister, Romania and Bulgaria are supposed to join in 2007 or 2008. There are high levels of corruption in Romania at present and 20 per cent of the citizens of Moldova have got Romanian passports. How confident can we be about the security of the EU's new external borders?

Mr Blair: Well, I think it is precisely for that reason that we need to focus on that issue and that was one part of the conclusions we reached at the December Summit, though it did not get much publicity for obvious reasons. Yes, it is a real worry and we have to make sure that one of the things we agreed to do at the December Summit is start using our power collectively, as the European Union, to get certain external assurances from countries that border the European Union or indeed obviously from countries that are coming into the European Union.

Q204 Mike Gapes: If we do not get those assurances, will their membership be prevented?

Mr Blair: Well, their membership is decided according to criteria that the European Commission judge, so that is a process where it is probably best for me not to enter into that debate, but the European Union obviously needs certain assurances that they will abide by agreements and then the European Commission gives us a report to say whether that is so or not. What is interesting about this issue is that it is Spain that has been driving this as an issue in the European Union, but it is something we have obviously been talking about for a long time, and I think again the mood on this has completely changed. Most of us believe that we should be using the neighbouring countries' desire to have good relations with the European Union to insist on certain procedures being put in place because organised crime, people-trafficking and illegal immigration are real problems coming in from the borders to Europe.

Q205 Mike Gapes: In your answer to Jimmy Hood, you said that it was difficult to operate with the present institutional structure. Half of the European Union Member States have ratified the Constitutional Treaty. Do you believe that that Constitutional Treaty will have to be revisited or is it dead?

Mr Blair: Well, whenever people ask the question of whether the Treaty is dead or not, the fact is that that depends not just on the UK, but on all the other countries. It is going to be revisited as an issue and what comes out of that, I do not know. I think myself that people understand that the rules have to change to make Europe work more effectively, but you can see from the statements coming out of certain of the French politicians and so on recently that there is no great appetite to go back into this in a way that makes this, as I say, the focus of all our activities.

Q206 Mike Gapes: You have mentioned France. Does that mean we will not be able to deal with the issue until after the next French presidential elections and the constitutional negotiations will start perhaps in 2009?

Mr Blair: I do not know again whether really I should comment on that, but I think it is a statement of the obvious ----

Q207 Mike Gapes: Why not?

Mr Blair: Because I am trying to be diplomatic! I think it is a statement of the obvious that, unless the French decision is reversed, it stands and that is why I think, when people somewhat glibly say in certain parts of Europe, "Well, we'll just put it back on the agenda again", this thing can only happen if those two referendum votes are reversed in some way, so that is a reasonably large hurdle to overcome. Having said that, we have already agreed, and I think we said that we would have, a period of reflection and that period of reflection is due then to culminate in a discussion mid-way through this year, but I think President Barroso and the Commission were saying the other day, "Look, let's get the reform agenda going and not [as I say] put all the concentration on the Constitution", which for the moment obviously cannot be implemented because Member States are not in agreement.

Q208 Mike Gapes: But in the meantime between now and when that happens, presumably there is an argument for cherry-picking parts of that Constitutional Treaty which can be in order to make the institutions function better than they do at the moment?

Mr Blair: Well, whatever the argument, there are again other States that have said they will not agree to that, so you have got a bit of an impasse there.

Q209 Mike Gapes: It does not look very good, does it, for the next few years?

Mr Blair: I think it all depends what Europe wants to concentrate on. As I say, I think there is a real problem with the way European business can be handled with the revolving six-month Presidency. When you have got a country the size of Britain, it can be done, but nowadays even that is done with an incredible amount of energy, resource, commitment and so on. We had to spend a very large part of the last two months of last year focusing on European Union business. I think, when you get a Europe of 25 and then 27 and you have got several small countries in immediate succession to each other handling the whole of the Presidency, if you take something like the budget or the Turkish accession negotiations, which are huge pieces of political sort of engineering, if you like, which have to be done, I think it is very, very hard to see how that can happen. I think at some point, as I say, you will have to return to this issue. However, having said all of that, I have no doubt at all what people in Europe want to see Europe concentrating on, and you raised the issue right at the very beginning, Mike, quite rightly. They think, "Look, what are the big issues facing Europe today? The state of its economy, illegal immigration, organised crime, can we make Europe's voice count in the world where we want to. Concentrate on that and then come back to the institutional questions". I think that is where the commonsense view in Europe is today.

Q210 Mr Jack: Prime Minister, I think it would be helpful if we just probed a little further what you have just been saying and also the Barroso reform agenda because one of the bits of rhetoric that has come out of Europe in the last few years that gave some hope that Europe had recognised the changed nature of the highly competitive world in which it operated was the Lisbon Accord, but, in your recent speech, you said that it had been "more honoured in its breach than its observance". During our Presidency, did you have any candid exchanges with fellow European leaders to explore why it was that that breach was the way you put it and that we just did not seem to be moving in terms of achieving the objectives of Lisbon, if nothing else, to address the 20 million of our fellow European citizens who are not in employment?

Mr Blair: I had a lot of candid discussions about it, but you have got to get a consensus around the issue of change and reform. Now, there has been some progress on this, let us be clear, it is not that nothing has happened, but not enough has happened. I think the big test will be whether in the next few months we can agree the Services Directive which is tremendously important for our country and for other countries too, and whether we can get this Working Time Directive sorted, which we very nearly did in our own Presidency, but not quite. Of course you are absolutely right, the issue is the 20 million people who are unemployed.

Q211 Mr Jack: Let me ask you this: is there a real appreciation in other parts of Europe? In the United Kingdom we believe in open markets, we recognise the competitive forces and we try to run our economy to respond to them. The impression I get is that a lot of the rest of Europe is very happy with a high-cost social model and it almost wants to shut the door to what is happening. You mentioned two initiatives, and the Services Directive was one of them, as to things that should happen. If you were to construct another road map towards achieving Lisbon, what would be the key milestones on that journey that we have got to achieve and over what timescale have we got to do it because, for every day that passes, the problem gets worse?

Mr Blair: Well, there is a major debate going on in Europe and has been. To be fair, I think this debate has been going on probably for the last 20 years and the question really is: in which direction is it moving? My view, but it is on balance, is that it has tipped towards the reform agenda, so there are people still saying what you say. This is why, if there are certain politicians in Europe that go in and advocate the British way, they will get a pretty fierce reaction from parts of their electorate. On the other hand, I think that the argument that really did strike a cord when I used it in June in the European Parliament was: what type of social model is it when you have got all these people unemployed? If the purpose of the social model is social justice, how is that compatible with large levels of unemployment? Of course it is not. All I would say is that I think that argument is gradually being won and I think over the next few months we have got three important tests: the Services Directive; the Working Time Directive; and then, thirdly, the deregulation initiative of the European Commission. Now, there will be compromises along the way no doubt on all three, but, if we can secure those, then I think it is some indication that we are beginning to move in a different direction and I think that, when electricity liberalisation comes in, I think it is, in 2007, that again will be a big test. You know, you are right, that is what people say. What people say is, "If you open up the market, then we lose X thousand jobs". I think what is important for us to do, and you have got precisely the same argument over the world trade talks, is to say to people, "In the end, you are gaining far more and more jobs come and you have a greater degree of economic success if you open up", but that is a debate, is it not? That is why I think it is important that Britain remains at the centre of that debate, because we are obviously a very strong proponent for that type of politics, but it is interesting, for example, on the economic reform agenda that a country like Spain, which had a very sharp disagreement or its Prime Minister did over foreign policy with the UK, is very much with us on the issue of economic reform. I think that the new Chancellor in Germany obviously is again an advocate of reform both within Germany and in the European Union, so all I am saying is I think you can see ways in which this argument is shifting the right way for us, which is why it is important that we remain stuck in there.

Q212 Chairman: Do you think there is any limit on the amount of expansion the EU can afford to undertake?

Mr Blair: That is a very difficult question. I think that, for the countries in the Balkans, the offer, the perspective of European membership is a very important part of changing those countries. When you then get beyond that, I do not know. It is very difficult. Obviously we have a neighbourhood partnership with countries like Ukraine, but we have to take this step by step. As Jimmy was implying, there is no doubt at all and if you had referendums, and incidentally you will have to have referendums, in some countries on new membership of the European Union today, they would have a tough struggle on their hands and I think over Turkey there will be obviously a big debate and I think that debate will be very, very important for the future of Europe.

Q213 Chairman: Do you have any vision at all of how far east we can go or where the limit would come or do you envisage, for example, that we can go as far as seeing Russia join in with Europe?

Mr Blair: This may not be the time for such an announcement!

Q214 Chairman: I do not know if it is a propitious time, but it is a question that needs to be addressed for the long term.

Mr Blair: Yes, it does, maybe in the long term! For the moment, we have got Bulgaria and Romania coming in, Turkey is going to be, let us be clear, a huge decision about the future of Europe, what type of Europe that Europe will be and then you have got the Balkan countries. There are all sorts of relationships other than the membership that you can have with countries as well. Who can tell what will happen in the very long-distant future, but I do not think that is something on the agenda at the moment.

Chairman: We now move on to the second theme, the reform agenda.

Q215 Dr Wright: Prime Minister, we are going to ask you mainly about education and health policy and some issues around that. Although there seems to be an outbreak of consensus now on the Government's education proposals, and it was a bit of a mystery to me why it has had so much difficulty, I wonder if one of the reasons is that, as is often said, the quality of White Papers has rather fallen off over the years. What I want to do, if I may, is take you back to your own preface to the Education White Paper which has caused so much difficulty. You say, "There is increasing international evidence that school choice systems can maintain high levels of equity and improve standards". Now, as you know, there is a huge argument about all of this as to whether choice systems improve standards across the board or whether in fact they lead to cream-skimming and social segregation. Now, having given us that statement in the preface, you would expect the underlying analysis and the evidence to be picked up in the White Paper because there is a kind of theory trying to get out in the White Paper which you give us a glimpse of at the beginning, but, if you go to the body of the White Paper, there is no further reference to any of this evidence. Is that not part of the difficulty?

Mr Blair: Well, Tony, the real point is that there is a mass of evidence from here as well. Essentially what the school reforms do is that they take the system of governance of the voluntary aided, ie the church schools, they take the freedoms of foundation schools, they take the ability to have external partnerships of the city academies and, to a lesser extent, the specialist schools and they put them in one place and allow schools as of right to go down that road. Now, we have got ample evidence, and there is international evidence, but actually we have ample evidence for what happens in this country.

Q216 Dr Wright: Yes, we know that, but you are telling us there is all this evidence supporting the approach that the Government wants to take. I happen to think there is a good deal of evidence, but the problem is that it is not available anywhere and it is not in the White Paper. In your preface again, you mention Sweden. Why do you mention Sweden?

Mr Blair: Because they introduced forms of school choice, not the same as we are doing, but they have introduced forms of school choice and greater diversity that has been extremely popular there.

Q217 Dr Wright: When the Education Secretary gave evidence to the Education Select Committee the other day, she said, "What I can tell the Committee is that this is not based on the Swedish model".

Mr Blair: As I said, it is not the same as the Swedish model.

Q218 Dr Wright: But why cite Sweden in your preface when Sweden is repudiated by the Secretary of State when giving evidence to the Education Select Committee?

Mr Blair: I do not know that she repudiated them. We are not proposing the same model as Sweden, but there are elements to do with parental choice and diversity of supply that are the same. However, having said all that, I think the point you make is a fair one in a way and actually one of the things I think we should do in the next few weeks, and the Department is actually working on this, is to try and produce some of the international evidence about different school systems and how it works. I think the general point you are making actually is a perfectly fair one.

Q219 Dr Wright: You mentioned Florida in your preface. If I ask the same question about how does Florida relate to what is being proposed here, your answer will be, "Florida does not relate to what we propose here", so why mention it? What is interesting about the United States are the charter schools which again are not analysed at all in the White Paper and when the Education Secretary again gave evidence to the Education Select Committee, she said, "Charter schools do not inform this White Paper". You see why it is all very confusing?

Mr Blair: I entirely understand the point you are making, although I would say that, for charter schools again, there are elements to that which are similar to what we are proposing, but ours is not the charter school model. Now, having said all that, I think the general point you are making is actually a perfectly fair one and I think it would help if, over the next few weeks as we prepare to publish the Bill and then have the debates in Parliament, we publish the evidence on what happens abroad. I think then people will see that there are, as I say, elements of diversity of supply and parental choice that are being introduced by countries right across the world. However, if I can go back to my original point, the main reason we have introduced these reforms is not because of any foreign model, Swedish or otherwise, but because of what has happened here in this country. The reason why I feel so strongly about this is that I think the great thing about the British education system is the myth is that we do not know what works, but actually we do know what works. It is perfectly obvious and, if you look at the school system today, you can see the schools that are the ones that are pushing ahead and they are the ones which, within proper rules in relation to selection and so on, develop their own independent sense of culture and ethos and are able to give a sense that the school is not just part of a system, but is a school that is special in itself.

Q220 Dr Wright: If we can just stay for a second with these charter schools, one feature of the charter schools in the United States is that they take as axiomatic that, if these schools are oversubscribed, then they have a lottery to see who goes in. They think that is the only fair way to do admissions. Now, that would have been an interesting model to have brought here, but that is not part of what you are proposing.

Mr Blair: No, it is not and that is why I say it is not exactly the same. However, what is an element in charter schools and in what happens in Sweden and indeed in other countries too is this idea that you have in today's world in public services a far greater diversity of supply. My whole point about the education system is that we went through the period of divide, richer divide, grammar schools, secondary moderns, and the comprehensive system was then an attempt to say, "No, we shouldn't divide kids up into successes and failures, aged 11". What I am saying is, "Look, now is the time not to get rid of that principle, but to understand that it has to be modernised for today's world", and the way of doing that is to create far greater diversity of supply, have external partners, have schools with the freedom to manage their own assets, to manage their own staff, and to develop their own independent sense of culture.

Q221 Dr Wright: Just to come back to the point that I started with, when my Committee took evidence from the head of your Strategy Unit the other day, we asked him whether in fact there had been work done on these kind of underlying issues that bear on the Education White Paper, and he said, "Yes, we have done work of this kind". Then we asked if it had been published and he said that it had not been published. It just seemed to me daft to have the kind of discussion that we are having about this at the moment without having available to us the kind of work that is being done in government that bears directly on it, so are you giving us an assurance now that over this next period, while the Education Bill is being discussed, all this work that is being done in government will be made available?

Mr Blair: It is exactly what I have just said a moment or two ago. I think it would be very sensible because I think you have got a perfectly fair point and in fact, as I say, I some time ago asked the Department to bring together this evidence so that people can see it. Now, I am not exactly sure what particular documents are going to be published, but the basis of it, I think, is a perfectly fair point. Also, because I think this would help indeed in health as well, sometimes we almost have the impression that this debate on public service reform is going on in this country, but not anywhere else. It is going on everywhere. All countries of a similar type, ie modern, industrial countries, are looking at a situation where they are spending large sums of money on public services, universal public services, and they are looking at: how do we make those services more responsive to the user, more responsive to the patient or to the parent? It is perfectly natural that all of us should be looking at this way of doing it and that is why I think it is a very sensible idea that we do this in education, but we should do the same in health frankly.

Dr Wright: Absolutely and that is why it seems daft, in the spirit of evidence-based policy, that we did not make the evidence available.

Q222 Mr Sheerman: Prime Minister, you said just now that we know what works. To a large degree, and many people would agree, we do know what works when we are talking about the majority of students in our school system, but when Ruth Kelly came before our Committee fairly recently, she said, "This White Paper is all about driving up standards for the most disadvantaged children", and we shall take this as the measure on which to judge the White Paper. Do you really think that there is enough in the White Paper to focus on those most disadvantaged children and help them to get the education they deserve?

Mr Blair: Yes, I do obviously. I think, once we give the reassurance we needed to do on no return to academic selection and that the local authorities would have the powers that local authorities have got to have in order to do things that only they can do, then we are now free to make the argument as to why for children, particularly from the most disadvantaged backgrounds, the present system is not working well enough for them. Far too many still fail their exams and some of them are in schools still where under 30 per cent of the kids get five good GCSEs. We have seen, through the city academies, through the CTCs, through the specialist schools, that engaging external partners and giving the school greater freedom can help improve the schooling for the most disadvantaged kids. Let us build on that and drive it through the whole system and the Schools Commissioner will have the role specifically of ensuring that he or she can focus on the most disadvantaged kids in the schools with greatest difficulty and then try to get them the right external partners to help because the one thing the city academy programme has shown is that there is a huge amount of energy out there in the charitable, the voluntary and the business foundation sector waiting to come in and help.

Q223 Mr Sheerman: Prime Minister, what do you say about the remarks from Peter Hyman who worked for you for ten years both in and out of government and he went off to become a teacher in a pretty tough-condition school in Islington? He says, "It is not partnerships or trusts that will really help a disadvantaged child" in his school. "What will really help is the quality of what happens in the classroom, and particularly the size of the school and the size of the class". Is that not where we should be concentrating our efforts?

Mr Blair: Absolutely, but the question is: to what degree does structure help achieve that? Actually I think in Peter's school, they are making changes in the status of the school themselves, but of course in the end it is like everything else, that the reforms are a means to an end, but they are not an end in themselves. It is like choice in the Health Service. Choice in the Health Service is not the end, but it is a means to an end. It means that, if people cannot get a decent service in place X, they are able to go to place Y in exactly the same way for the schools. The reason why we want to introduce these freedoms for schools and the ability to have external partners is not because in themselves those are the things that matter, but because the evidence is that that then helps change what happens in the classroom. Of course you are absolutely right, that what happens in the classroom is what determines whether a kid gets a decent education or not, but all I am saying to people is let us just think of what has happened. In the past eight years we have put a massive investment into education and none of us, I would suspect, could go into our constituencies and not see the difference the investment has made and, it is true, school results have improved significantly. Even if you, on any basis, look at the results at age 16 for GCSE, they have significantly improved in the last eight years, but they have not improved enough.

Q224 Mr Sheerman: Prime Minister, I think we would all agree with you, but what I am pushing you on is the most disadvantaged children. What we do know, and Peter Hyman also says this, is, "It is the social mix that comes into the school that is so important in terms of helping to drive up standards". I take it from his view that he agrees with many members of my Committee, that, if you have total social mixes with all middle-class, professional background children or all kids coming from backgrounds that are more working class and perhaps less interested in supporting their children in education, both scenarios are wrong and you need a good social mix. What are we doing about that, Prime Minister?

Mr Blair: Well, in the end you get the good social mix by one of two ways. You can try and sort of force that to happen, and I just do not think that works. My own view of this is that, whatever system you put in place, middle-class parents will try to do their very best for their kids and, in the end, you can go and move house in order to get next to a good school and, incidentally, who can blame them? In the end, they are going to do the best for their children. We all want to do the best for our children. The question is: how do you get more good schools, how do you get more schools which a mix of kids will go to? The thing that I feel most strongly about at the moment is that we do not have a single-tier system in our education system, but it is perfectly obvious that you get schools in some of the poorest areas where all the poor kids go. Now, the way of changing that is to make that school better because, if it becomes better, then a broader mix of people go into it. You cannot expect parents to send their kid to a school as a piece of sort of social engineering, but they are going to send their kid to a school if they think the school is good. Now, what has happened with city academies, and this is one of the great myths, and there was an article in one of the papers the other day, saying, "This school academy used to have X percentage of kids with free school meals and now it has got Y percentage of kids with free school meals. That is a lower percentage and that means that this school is not going to help the poorest kids". Rubbish. What actually happens with the city academies is that you get more kids going into them and yes, some of those are not poorer kids, which is in fact good because you do not want a school where just the poor kids go.

Q225 Mr Sheerman: Last night, Prime Minister, as you probably know, I had a letter from the Secretary of State which had some very encouraging responses to the Select Committee inquiry into the White Paper, but the one bit that is not referred to strongly enough, just taking quite a weak benchmarking exercise, is that for every university in the land, we do not push, we do not have quotas in higher education, but HEFCE does have a benchmark of the social mix that is flowing into all our universities, whether it is the University of Huddersfield or the University of Cambridge. The fact of the matter is that we merely wanted the Schools Commissioner to have a similar role in terms of secondary schools. Why would you not embark on that one?

Mr Blair: Because I think we felt in the end that it was better to do this through the Admissions Forum. Incidentally, I thought the Select Committee report was a very good and careful piece of work and there are certain things that we are able to do that meet the points that you made. I just think that in the end the most important thing is to create a broader band of good schools rather than think you are going to be able, by any exercise, to force people to go to a school they do not want to go to. I know you were not suggesting that, but in the end I think doing this through the Admissions Forum and through strengthening its powers is the best way to do it, but I want to tell you very honestly that I do not think that, whatever mechanisms we in government use, that is going to do the trick. What will do the trick is more good schools because people all want to go to better schools and that is why I think, as I say, that, where the city academies have been introduced, despite all the controversy, and you only have to look at the subscription rates, these schools which were basically undersubscribed are now oversubscribed and sometimes massively.

Q226 Mr Sheerman: Prime Minister, 13,500 of our schools are community schools, regular community schools. What rate of change do you see happening there? Two thirds of them are community schools and there is again one slight rub from last night's letter, that community schools are going to be a possibility, but why do they have to jump through the hoop of the Secretary of State approving on course to the adjudicator making the decision?

Mr Blair: Because I think it is very important here, and we listen to what the Local Government Association and other people are saying, that, if the key is parental choice, how can you then say that you are excluding, even if the parents want it, the possibility of a new community school? In order to make sure it is really what the parents want then to have that new school there is the open competition and the local authority can enter it, but they do not then decide it; that has to be decided objectively. The Secretary of State obviously needs to be sure that there is that real parental demand. In a way it is a change that makes it more consistent with the spirit of the White Paper in the sense that it is what the parents want that is the key thing, but we do have to be clear that that should only happen if the parents really do want it and in those circumstances there is an open competition and it is not decided by the local authority itself. It is a change that the Local Government Association wanted and in a way it is fair enough because it means that the local authority competes on equal terms, but we cannot end up in a situation where people do not have the ability to have trusts if that is what they want.

Q227 Mr Willis: Prime Minister, considering you once said you do not have a reverse gear, you have made a spectacular change from when you first announced this White Paper to the point we ended up with last night, with Ruth Kelly's climb down on a number of key issues.

Mr Blair: Is that your press release or an analysis, Phil?

Q228 Mr Willis: It is a bit of both. You have had a very easy time so far. Is this a result of Labour backbench rebellions or the fear of Conservative support for your proposals?

Mr Blair: I would like to think that, now that we are all agreed we do not want to return to academic selection, the reassurance on that is perfectly sensible. The problem that I found with the original proposal in the White Paper was, if parental choice was the key, how could you say that, even if the parents wanted it, the local authority was not able to propose a community school when it was not going to decide the outcome of the competition? That is a change fully consistent with the White Paper. The essence of the change that I hope you can support is that schools should have as of right the freedom to own their own assets, manage their own staff and develop their own independent culture and ethos. That is the essence of the Bill and that remains the case.

Q229 Mr Willis: Having spent 34 years in state schools, not the private sector, I support anything that will actually remove one million children who are continuing to fail in our education system just as they were in 1997. Yesterday Steven Patriarca, the Headteacher of William Hulme's Grammar School in Oldham, said that his governors were taking the school out of the independent sector to put it into the state sector. This was the quote he made: "The White Paper was an enlightened document because it enhanced a move towards the privatisation of education." Was he reflecting your views?

Mr Blair: It is obviously not the privatisation of education, is it, because the trust schools are maintained schools that are within the state sector? There are a lot fewer children today failing than there were in 1997. The results have increased significantly, in some cases dramatically, for example in London. You used to have many boroughs in London where fewer than 30 per cent of the kids would get five good GCSEs. No London borough gets less than 40 per cent today. There is something like treble the number of schools in London that get over 70 per cent good GCSEs. If the system as it is was the answer to the problems of the kids that still do not get a decent education it would have sorted them out a long time ago, which is why, with the greatest respect to you, however long you spent in the state education system, it is time we made changes.

Q230 Mr Willis: I am not disagreeing with that one iota. In 2002 there was an Education Act passed which gave schools freedoms to innovate provided the Secretary of State agreed. Do you know how many have applied for those powers to innovate?

Mr Blair: There are lots of schools that are foundation schools.

Q231 Mr Willis: Until last year there were three and they wanted to change the time of the school day. I do not know where this thirst is for the change you made.

Mr Blair: For example, city academies and the foundation schools operate with a far greater degree of flexibility and like to do it. One of the things that this Bill will do is increase the ease with which schools can innovate. Some of the best schools are innovating about how they use the National Curriculum and how they teach and I think that is fantastic. The Internet and all the new technology offers good opportunities for people to teach in a different way.

Q232 Mr Willis: One of the key drivers and every piece of research - and no doubt when you make the research available it will demonstrate this - shows that in terms of actually turning youngsters on to education, it is what is actually taught in the classroom by enlightened and innovative teachers that makes a difference and yet the whole curriculum changes which Tomlinson actually proposed you chose to throw out on the very day on which they were announced.

Mr Blair: I have not thrown them out. In my view the bit of Tomlinson that I found difficult was the idea that you then replaced A levels because I think people have gone through enough of all that. What they really want to know is, whether it is A levels or GCSEs, there is sufficient rigour. The bit of Tomlinson I totally agree with and we will implement is the bit to do with vocational education and a proper vocational education stream, reducing the numbers of qualifications significantly and ensuring that kids aged 14, if they want to go down that vocational route, can do so. That bit of Tomlinson, which is the heart of Tomlinson, we most certainly intend to introduce. Of course it is true, what is taught in the classroom matters, but the reason we have had to intervene very heavily with some of the failing schools and turn them around is because what was being taught in the classroom was not good enough. If you can bring in external partners and new providers of schools that are going to do a better job, let us do it. Let us have nothing stand in the way of getting the best education for the kids.

Q233 Mr Willis: With the greatest of respect, Prime Minister, that is happening in many of the schools that are described as being "bog standard" in the country at the moment. Let us just return to the issue of social segregation because that is one of the key issues here. Over the next ten years half a million fewer school places will be needed simply because of the demographic changes. If you are going to allow new schools to set up as trust schools and you are going to allow popular schools to expand, who do you think will be left behind in the schools that remain? What is going to happen to those? The children who at the moment are the most disadvantaged, with parents who are not able or not willing to advocate for them, what is going to happen to those children in this grand new vision?

Mr Blair: First of all, the local authorities, as the White Paper makes clear, retain the strategic role in respect of things like falling rolls. If you have a situation in which a school is under-subscribed and people are not going to it, the first question that I would ask is why are people not wanting to go to that school? I would not say the first question you ask is how do you prevent a good school expanding?

Q234 Mr Willis: I did not ask you that. I asked you what is going to happen to those schools. You are just going to let them wither on the vine. They are just going to die.

Mr Blair: I am not saying they are just going to die. What should happen is the local education authority - and the best ones are already doing this - should be asking the question why is this school not getting the parental demand? Why are people not queuing up to join this school?

Q235 Mr Willis: With respect, you are not allowing the local authorities to manage this situation. You are actually taking it away from them by allowing all schools to become trust schools with their own admission arrangements.

Mr Blair: You know perfectly well that being their own admissions authority - which voluntary-aided and foundation schools already are, in other words a third of secondary schools already are - is not the same as deciding their own admissions policy. That is why we have given clear reassurance that there will not be a return to selection. That is not what is going to happen. When you said a moment or two ago that some of these schools had made great improvements as so-called "bog standard" comprehensives ---

Q236 Mr Willis: Your phrase!

Mr Blair: There has been huge improvement in some of the worst schools in the country, that is why you have got very many fewer failing schools, but that has often been as a result of things like Excellence in Cities, federations and new partnerships. It has not happened because we left the system up to itself. In the end we have got to decide a very clear thing. There will be people who debate about if we have changed the essence of the White Paper or not. It is absolutely clear, the basic freedoms will remain, ie the freedom to own your own assets, manage your own staff, develop your own school in the way you want, with an external partner if that is what the school wants. We have given the reassurance on selection that people need, but in the end we have got to decide who are the people that are going to make the changes in our schools system and I suggest the real innovators are the people who are running the school, who are actually in the school and where the parents and the teachers at a school want to take it down this path, let them do so, let there be no restraint on them being able to do so. That is the essence of the proposal. The reason we have put it forward is because we can see from what we have already done in the British system over the past few years, as I say, what works and what does not. The purpose of this is not to end up in a situation where you just cut a school adrift if it is not doing well. On the contrary, it is to give the local education authority and others greater powers to intervene to make sure those standards are raised. In my view we are not going to achieve the step change I want in education unless we are prepared to be fully supportive of those things.

Q237 Mr Willis: Will you rule out categorically that there will be no interview of parents in terms of admission policies, there will be no interview of students as far as admissions policies are concerned and that there will be blind applications for schools for the allocation of additional places within those schools? Will you confirm those three things?

Mr Blair: We made it clear in the Code of Practice that interviews are bad practice. We have strengthened that by saying that that will not be allowed as a means of academic selection by the back door.

Q238 Mr Leigh: Prime Minister, why are you, therefore, under the concessions last night, explicitly going to ban The London Oratory from interviewing parents?

Mr Blair: Because the Churches have already said - and this is what the Code of Practice says - that it is bad practice to use an interview as a means of selection. I am not getting into The Oratory or any other individual school. There is a considerable view not just within the education world but also within the Churches that run these schools that what is there in the Code already is bad practice and should not be allowed.

Q239 Mr Leigh: John McIntosh, the Headmaster, has built up a superb school. There is no problem in the leafy suburbs and the rural constituencies. My constituency is full of wonderful grammar schools and superb comprehensive schools. I am talking about inner London here. There you have The London Oratory which has a fantastic social mix. You accept that, do you not? It is full of middle class people and working class people. John McIntosh has built up that school. You are now going to ban him from interviewing parents. You are going to ban him from maintaining the Catholic ethos or the general ethos of his school. How can you do that to him?

Mr Blair: That really is not right.

Q240 Mr Leigh: Well, you are. It is a concession you made last night. He has fought a court case and he has won his court case. The concessions made last night are going to ban this man from running the school in this way. You know about the Phoenix School down the road. No middle class person wants to go to that school; they want to go to The London Oratory. It is hugely over-subscribed. Why can he not run his school in his own way?

Mr Blair: What you are saying is entirely incorrect. We are not stopping Catholic schools having a Catholic ethos. The vast bulk of Catholic schools do not use interviews as a method of selection. I am not entering into whether The Oratory do or do not. It is already made bad practice in the Code. The Churches themselves have said they do not approve of it. It would be absurd to say, when the Code of Practice already says that it should not and when the Church schools themselves say that it should not, that is destroying the religious ethos of the school.

Q241 Mr Leigh: Where under the concessions made last night are you going to allow Hammersmith Council to challenge any expansion plans that John McIntosh has?

Mr Blair: It is already the case that if the local authority wants to challenge a school expansion scheme it can do so. The difference is the school now as of right can expand and the local authority have an appeal, whereas at the moment it goes to the school organisation committee and unless the school organisation committee agree the school cannot expand.

Q242 Mr Leigh: The fact of the matter is that after these great reforms, this lion has roared and a mouse has appeared. John McIntosh will have considerably less independence in the way he is running his school than before because he cannot interview any more and his expansion plans can be challenged.

Mr Blair: The expansion plans always could be challenged and that is there in the White Paper, but the difference is schools are entitled to expand as of right with an appeal by the local authority. On the interviews, I think it is absurd to say that that is the difference between a good school and a bad school. There are only a handful of schools in the entire country that do interviews as a method of selection and the Churches have already indicated that that is bad practice. The freedoms that will remain are precisely the freedoms set out in the White Paper. Schools will have the freedom as a right to become self-governing trusts, they will be able to own their own assets, manage their own staff, develop their own independent sense of freedom and culture and that is the heart of the reform and that remains in full.

Q243 Mr Beith: Prime Minister, you have said that parental choice is an essential means of driving up high standards. So what is the means of promoting high standards in those areas, rural areas and small towns, where there can only be one secondary school and the nearest alternative is 20 or 30 miles away?

Mr Blair: It is worth pointing out that the vast bulk of the population do live within quite a short distance of more than one school.

Q244 Mr Beith: Some of us represent the rest though.

Mr Blair: Exactly so. There are those who do not. In those circumstances, of course, it means less than it does in circumstances where you are living in a city with a plethora of different schools. I have got a rural constituency myself. We are already looking at what external partners we can bring in and how we can develop the school. For example, a school like Sedgefield Comprehensive is already looking at the possibilities of federating with other schools. The fact that you do not have a mass of schools all clumped together does not mean to say the White Paper cannot still bring real benefits.

Q245 Mr Beith: When you cannot provide parental choice there are alternative means of driving up standards.

Mr Blair: Exactly, yes. I cannot force there to be more than one school in an area. Obviously in some of the rural areas there will be one key school. I think the ability to bring in external partners is something that will be very important and very helpful. If we look at the evidence of what has happened in specialist schools - and remember, the majority of comprehensives are now specialist schools - they already have some external link with local business people or others within the community, and I think most of the schools think that works very well.

Q246 Dr Starkey: Prime Minister, you spoke very passionately about improving education for members of disadvantaged groups. At our last meeting in November I raised with you the gap in outcome for the black and minority ethic population with the majority population in both education and employment. Since then, the ODPM Autumn Performance Report for 2005 has shown that the gap in employment rates between black and minority ethnic groups and the rest of the population has widened. What is the point in measuring the gap if the Government does not also have targets for improving employment in education amongst black and minority ethnic children and adults?

Mr Blair: You can always argue about whether it is wise to have a target or not. With a lot of the programmes that we have got they are specifically geared to helping particularly those ethnic minorities that traditionally have had real problems with employment and with living standards.

Q247 Dr Starkey: It has not worked in employment.

Mr Blair: The levels of employment have increased for everyone. I think this is one of the reasons why we are looking through Jobcentre Plus and the New Deal at focusing specific help on certain groups of people. There are difficulties and some of those difficulties can be to do with language and to do sometimes with culture as well. The one thing I would say is that it is important in relation to the schooling to recognise that there again, as Trevor Phillips was saying the other day, there is the possibility that by bringing in external partners and by giving a school a greater sense of independence we can help kids in some of those most deprived areas from ethnic minority backgrounds.

Dr Wright: Prime Minister, we would like to turn the focus to health for a few minutes.

Q248 Mr Barron: I want to raise the issue of NHS expenditure. In the year 2004/05 the total net expenditure for the NHS was £69.38 billion. That rose from the year before by £6.7 billion. If you look at it in terms of total expenditure since 1997, it has doubled since 1997. The deficit for 2004/05 was over £250 million. I think most taxpayers would want to know why that is the case when such massive increases are taking place in terms of the NHS?

Mr Blair: I think the first thing to say is that as a result of the additional capacity and also the changes of course the National Health Service is delivering more than ever before. There are more operations than ever before and waiting time lists have come down dramatically. For certain operations, like cardiac or cataract operations, people are being seen now within months whereas they used to wait years. All of that has happened. Why are the deficits in certain of the hospital trusts? I think there are two reasons. First of all, we have now got far greater financial transparency and with payment by results coming in across the whole of the system hospitals are now gearing up for what will be a different financial accounting system. Secondly, and it is incredibly important people understand this, ten per cent of the trusts account for 75 per cent of the deficit. In other words, this is not a generalised deficit across the board. The majority of hospital organisations are breaking even or are in surplus. It is within certain of these trusts and indeed some of them have been recurrently, over a number of years, in difficulty. There are good reasons and bad reasons for that, but what we are doing is looking specifically at each one of them.

Q249 Mr Barron: In the December figures for this financial year that were published the actual deficit is somewhere in the region of about £620 million. Whilst you say that ten per cent of trusts have created this deficit, it is actually growing in terms of the number of trusts that are now in deficit. Under those circumstances it seems difficult to understand if we will learn anything from the changes that took place in 2004/05 about not letting trusts roll on deficits year-on-year now. What action are we going to take now that is going to stop this, or are we likely to see a situation where we could have a deficit in the next financial year twice as high as the one that we had two years ago?

Mr Blair: That is a very good point. What we are actually seeing for the first time is a proper system of financial accountability where trusts are expected to live within the allocation and where they have got to make sure that they do that. As I say to people when I am answering questions in the Commons, there is a limit to what any government can put in in terms of money. We believe we are putting in very substantial additional sums of investment, they are yielding results within the system, but hospital trusts and others have got to live within their means.

Q250 Mr Barron: Is it the case that the management is not capable of managing budgets in this way? It is not the culture of the NHS of ten years ago that they would be taking the decisions they are today. Is there a deficiency in terms of the quality of management?

Mr Blair: When I said there were good and bad reasons, there are two different types of situation. One is where you have had poor financial management. I think it is important we realise that to an extent - and I choose my words carefully - any public service is a business to this extent. How they manage their affairs, procure equipment and so on is very much a business function and that has got to be performed to the highest possible standards and we probably need more of that expertise in the public service. There are issues to do with financial management. On the other hand, to be fair, I think there are hospitals, for example, where they have got split sites and where it really is not cost-effective to maintain the services in the configuration they have got them. They are trying to go through difficult reorganisations and no one ever likes that, you always get huge complaint about it and if we are not careful we end up in a situation where we are both attacking change within the National Health Service and attacking them for not doing their job properly at the same time. One of the things these chief executives often say to me is if you want us to sort out our financial problems that means change in the way that we run our services and we need your backing on that rather than every time there is a problem the finger is pointed at us, and I think that is a fair point.

Q251 Mr Barron: Is that likely to be assisted by the implication of these turnaround teams that we have heard about in the last few weeks that are going to go into these trusts that have got the deficits? Do you think that will happen?

Mr Blair: We did something very similar with accident and emergency departments. You have to be very careful about this because whenever you say this somebody turns up who has just had a bad experience in accident and emergency. So apologies to anyone around the table who has just had it! I think most people would recognise that accident and emergency departments are a lot better today than they were a few years ago. That was done in part not just through extra money but through a specific dedicated team led by experts who went in to each and every accident and emergency department and said, "This is how you are going to organise it, this is how you can make changes." The turnaround teams will go in and work with the hospitals, particularly those with the worst financial deficits because it is a small number that account for the bulk of the deficit and help them. Because the figures of money we are talking about are very large, the total deficit, even if it is at the end of the year £600 million, that is less than one per cent of the NHS budget, which in most organisations would not be considered extraordinary.

Q252 Mr Beith: Prime Minister, you believe that patient choice is essential and needs to be widened, but you also believe in the Private Finance Initiative as the best mechanism for hospital building. The PFI means that the taxpayer has to go on paying for a hospital for decades even if patients have chosen in quite large numbers to go elsewhere. It is not an asset you can sell. It is a commitment to continue paying that charge. What are you going to give up, patient choice or the Private Finance Initiative?

Mr Blair: The reason for the PFI is that it was the way of spreading the cost over a significant period and also tying in commercial contractors to a better system of financial management. It always amuses me over this PFI debate that it is almost as if in the old days the surgeons and the nurses would go and build the hospital. Hospitals have always been built by the private sector. The question is what the terms are upon which it is built. By having to spend the money upfront as a capital spend, the truth is, that was such a large expenditure governments were not doing it. As I was saying the other day, over half of the hospital stock was built before the NHS existed. Now there is the biggest hospital building programme the country has ever seen going on and it would not happen without the PFI. Of course there are issues going forward with how you spread the cost over a period of time, but let us be clear, the PFI contracts on the whole have been on budget and on time which the other ones were not and we would never have got the hospital building programme underway and all the new facilities that I can see just outside my own constituency unless we had done that.

Q253 Mr Beith: What the contracts do is require the taxpayer to go on paying even if at some point you decide that it is too costly an asset, you can do the job in some other way. You have just likened the NHS to a business, but here you have locked that business in to something which is creating deficits in some instances and that destroys any flexibility that the health managers ought to have.

Mr Blair: You have got to achieve a balance here. It is true that there is a further financial obligation on the particular sector of the Health Service to do well and that is an issue for them as they carry the costs forward. On the other hand, I think if you talk to most chief executives about the benefits that PFI have brought you will find that those outweigh the deficits.

Q254 Mr Beith: It was the only show in town, was it not? It was the only way they were going to get a hospital.

Mr Blair: I think that was the realistic truth. Before the PFI it was not happening. I know everyone always says but you could have put in all the money upfront as a capital investment. Well, you could have but no one had.

Q255 Mr Beith: You could have borrowed it at more favourable rates because you are the Government.

Mr Blair: You still have to pay it back on the borrowing. The question is would you get the most effective deal to get the private sector involved and in the end we believe that PFI is the best way to do it. I do not doubt the argument will go on for years about that. If you look around the world, most people are looking at this type of public-private finance initiative to get money into their private services.

Dr Wright: What Alan is suggesting to you is that all that was true, but then the introduction of patient choice and payment by results has put a spanner in the works as far as the PFI is concerned, and I think this is something that Andrew Dismore wants to take further.

Q256 Mr Dismore: I have got a PFI hospital in my patch. It is a nice new hospital although there are some problems with the design, particularly of the A&E department. The cost in terms of capital charges to the local trust is £5.7 million. Until recently that was being covered by the Department of Health and now that has been tapered off. By the next financial year, after the forthcoming one, they will have to find that £5.7 million themselves. It is one of those that you have put a turnaround team into because it is already struggling with its deficit. They have made a lot of progress in trying to deal with that deficit but it is simply being dragged down and increasingly so by the impact of the PFI charges. I am not going to get into an argument about whether the PFI is a good thing or a bad thing because we would not have a hospital without it. My concern is how the financing of that is going to become a burden increasingly on a trust that is trying to deliver services in such a difficult financial situation.

Mr Blair: The cost is a burden on somebody no matter where it falls. In other words, if you end up financing it, for example through borrowing, then the state has to carry those borrowing costs. I think we are moving to a public service system which is far more devolved down and it is true, obviously with choice and payment by results the hospital is going to have to keep up its revenue stream by operating effectively. Whatever system you have, you have got to have a system of financial management and the whole purpose of the combination of practice-based commissioning, payment by results and choice is to push power down to the front line and say, "Look, you are going to operate within a system now where the better you do the higher your income stream will be, but that is important because the better do you is being driven by the choice of the patient".

Q257 Mr Dismore: I would like to come back to how the cost of the PFI is met. If you are telling my trust you have got to have a turnaround team to try and sort your finances, despite what they have been able to do, with the existing management who I think are doing the best they can in the face of dramatically increasing demand from the wider population, the problem for them is the Department of Health has moved the goalposts. Whereas before the capital charge was met by the Department of Health, now it is something for the trust itself to meet. It is an additional burden beyond what they would have had before the PFI.

Mr Blair: Was that not always foreseen?

Q258 Mr Dismore: No, I do not think it was.

Mr Blair: Let me come back to you about that.

Q259 Mr Dismore: Let me go on to the point that you make about patient choice. One of the answers that you gave to the previous question was the problems facing hospitals with a split site and the need to reorganize. That again is our trust, that is one of the problems. They are trying to reconvene the services as the Department of Health want. The trouble is the local community do not want it, there has been massive opposition and for good reason, because you cannot physically get from one to the other hospital except within an hour or a two-hour public transport journey which is not achievable. What they have factored in, in accordance with the guidance policy of the strategic health authority, is a drop of five per cent in elective surgery which will impact on their income again. How does the trust cope with a dramatically changing client base, doing fewer operations with the money at the same time as trying to maintain this fixed cost of the PFI?

Mr Blair: I agree it is a very difficult situation for those trusts that are having to undergo substantial reorganisation and change. My point is this - and maybe I could come back to you on the detail of your particular hospital ---

Q260 Mr Dismore: I am just using that as an illustration.

Mr Blair: I appreciate it is an illustration of an issue. You need a system of financial accountability. What is the best system? The best system is one in which the service is being configured around the needs and desires of the patient rather than the other way around. I cannot answer the point about the particular reconfiguration of your services and what is happening there. The whole purpose of practice-based commissioning, payment by results and choice is as far as possible to get systems of financial accountability - given there will be a limit on the amount of money any government can put in - that puts the patient in the driving seat. I suspect in certain situations, whatever system you have, when you come to make change it is going to be difficult. Even under the old system, everybody who has ever dealt with a potential hospital closure knows what the problem is.

Q261 Mr Dismore: Tell me about it with an age-old hospital!

Mr Blair: Exactly. It is very hard. Sometimes you get a situation where you will even get the clinicians saying, for example, antenatal services are better done in one central place or cancer services are better done in one central place rather than in district hospitals and there is absolute hell going on locally about it, but you are going to get that whatever system you have.

Q262 Mr Dismore: That is not the problem I am raising with you. The problem here is that the solution that has been offered by the Department of Health is you have got to reconfigure the services by moving the services from one place to another. The problem is the patients will not do that because patient choice gives them other more attractive options to go elsewhere, taking their money with them. The trust has been told to factor in a five per cent drop. In practice the drop, if they do what they are told to do, will be significantly greater, therefore significantly increasing the financial problems which come back partly to the fixed costs.

Mr Blair: I understand that. Whatever system you have the cost has got to fall somewhere. I just do not know enough about the individual circumstance.

Q263 Mr Dismore: This is just an illustration.

Mr Blair: I appreciate that. Whatever system of financial accountability you have, you are going to have a situation where there may be a clash between the configuration of services on particular sites and what the income stream of the hospital is going to be. I agree and I accept that the fact that they have to carry the servicing of PFI is an additional burden, but the burden either gets carried locally or it gets carried nationally. The whole purpose of the changes that we are making is to push power downwards. There is a symmetry between what we are trying to do in education and in health and indeed in other local government provision, which is to say in the end the best system of financial accountability is one devolved downwards where the user of the service is in pole position. I suspect that whatever system you have you may get situations like the one that you are describing. I do not know what the actual answer to it is in your own case, but whatever system of financial accountability you use you are going to have these types of problems.

Q264 Mr Dismore: The only difference with the PFI is it is not something over which the local trust has any control. It is a fixed burden that they cannot reorganise themselves around or change around. That is a dead weight.

Mr Blair: That is a cost as a result of having the PFI. The only alternative to do that is to bring it all back into the centre and carry it as a borrowing cost. If you are putting that money there then you have got to take it from somewhere else.

Q265 Mr Dismore: The advantage of doing it that way is that patient choice does not impact in the way it would do in trying ---

Mr Blair: Patient choice is always going to impact. There is an upside and a downside with how you make a system like this work and I think the upside outweighs the downside, but that is the debate. In the end, if you put patient choice in so that the money follows the patient and you have a payment by results system you are going to have a situation - leaving aside all your problems, there is no PFI, no reconfiguration - where if patients stop going to hospital X and go to hospital Y then hospital X is going to have a financial problem.

Q266 Mr Beith: Then you can sell it. You do not have to go on paying for it.

Mr Blair: That is not going to get you out of your problem with the people in the hospital saying as a result of patient choice you have given me a financial problem.

Q267 Mr Dismore: The question really is whether the dead weight is carried locally or nationally.

Mr Blair: It is. If you carry it nationally and therefore you carry your burden in your £5 million nationally, that £5 million has got to be compensated for somewhere else in the system.

Mr Dismore: If the patients are moving around all over the place and moving away from the hospital that has got the dead weight burden ---

Q268 Dr Wright: The issue is that the PFI depends upon predictability on both sides and we are deliberately now, for all kinds of good reason, introducing unpredictability into the system through patient choice and through payment by results and it is the conflict between the predictability that the PFI needs and these other elements which were not thought about at the beginning. We have opened it up. We shall no doubt return to it again.

Mr Blair: It is not the only unpredictability. Even if you took that unpredictability out of it, in a system driven by patient choice and payment by results you will have unpredictability whatever system you have.

Q269 Dr Wright: I find that my constituents who are in Middle England are saying to me increasingly that they are worried by the fact that measures that are being passed that apply only to England are being voted on by Members of Parliament from Scotland and Wales who have their own parliaments. We are shortly to have a vote on smoking in public places. This is being decided separately in Scotland, it is being decided separately in Wales, it has even been decided separately in Northern Ireland so as to apply to England and yet it is to be voted on by Scottish MPs, by Welsh MPs and by MPs from Northern Ireland. So you can see why the cry is going up from my constituents who say "Why can't we have English votes on English laws?"

Mr Blair: I understand the argument. The reason I do not agree with it is the reason that was given back in the 1960s when this argument first arose in respect of Ulster MPs and that is because I think if you try to have two classes of MP it just does not work. This is a debate we are going to continue having over the next few years, but I just do not agree with it.

Q270 Chairman: Prime Minister, the more you expand devolution the more England-only legislation there is. I have raised this point with you before and you dismissed it, but you cannot dismiss it indefinitely. It will not go away. As I said in the debate on Welsh devolution the other day, it is going to come back and bite us. Eventually the English voter will not put up with me coming and telling them what they can or cannot do when I am not accountable for a single England vote.

Mr Blair: Some of those round the table may agree with this. I do not because I think if you end up with two classes of MP you will end up with a host of real problems.

Q271 Chairman: It is not second-class MPs, Prime Minister. You have altered the constitutional balance with devolution. I am against devolution and I always have been. You cannot argue from a position of a balance of power pre-devolution that devolution has altered the relationship and the House of Commons has to come to terms with that. You think we can get away indefinitely with failing to address it and we cannot.

Mr Blair: I am not failing to address it. I am simply saying I do not agree with you and the reason I do not agree is that English MPs remain in the overwhelming majority, the public spending is decided by a majority of English MPs and that has a Scottish and English dimension to it. I think if you try creating two classes of MP you will get yourself into all sorts of trouble and you will find it very, very hard to start distinguishing between those things that are purely English, those things that are purely Welsh or Scottish. I can totally understand why our Conservative colleagues wish that to be the case, but I do not agree with it and never have. It is not that I am avoiding addressing it, I am just saying I do not agree.

Q272 Chairman: By the nature of the Labour Party votes it is inevitable that when you get the smaller Labour majorities the Labour majority is dependent on the Scottish and the Welsh votes. At that time you will not have an English majority or the party would not have an English majority in the House of Commons.

Mr Blair: We have got a UK Parliament.

Q273 Chairman: How do you deal with that? It should have been thought about when the devolution programme was being pressed forward but no-one would face it.

Mr Blair: I am sorry, it was thought about. It is not as if this argument has not been fought over. You will remember it better than me from the 1970s for heaven's sake. I totally understand why people from other political parties think it is a good idea. I think in the end if you try to divide MPs up into two categories and then you have to define the legislation they are able to vote on and they are not able to vote on you will find it very hard. That is why I confidently predict that although there will be a lot of debate and argument about it, I doubt that a government is going to introduce this. This debate has gone on forever. It is not as if the issue has not been addressed.

Chairman: We will probably return to this.

Dr Wright: Kevin wants a final word about cancer.

Q274 Mr Barron: I will resist the temptation of asking you where you will be next Tuesday afternoon when the Health Bill is on the floor of the House. In relation to the Cancer Plan, the Committee of Public Accounts last month gave a review of the National Cancer Plan, and it is five years in now since its launch. The very positive thing they said about it was that the many important targets had been achieved. By June 2005 there were 975 extra cancer consultants in post and more than £400 million of new equipment had been delivered and more than 99 per cent of patients referred urgently by a GP are now seen by consultants within two weeks. That is clearly a success in relation to that. However, an analysis suggested that surviving cancer still depends on where you live, with those in London and the South having a better chance of beating the disease and better access to drugs. One of the examples was the breast cancer drug Herceptin, not the current debate but the prescribing patterns in the year 2003, where in some areas they had a prescribing pattern of 90 per cent of women receiving the drug and in others it was as low as ten per cent. How would you see the issue of this inequality that there is at the moment still within cancer treatment in this country is going to be really addressed in the next five years of the national cancer plan, and how will that happen?

Mr Blair: I think it is important, first of all, that we make sure that in the areas of greatest need we put the resource in that is necessary, and the Cancer Plan will allow us to do that. I think the White Paper that was published on community health care will also have an impact and on some of the issues to do with lifestyle, and so on, again, the public health agenda will help. However, I think the most important thing is to recognise that there has been enormous progress of the field of cancer - I think that is accepted by everybody - but we still have a tremendous amount to do. In particular, what we need to make sure is that for issues to do with prescribing there is a general practice that is obeyed right across the country, and that is what we are trying to do. As you know, we have been in touch with the PCTs to tell them they should be making sure that they are following the protocols on this and that the people who need the drugs get them.

Chairman: Thank you. We must now move on to the final stage, which is the international relations section: relationships with Iran and the impact of the recent elections in Palestine.

Sir George Young: Prime Minister, we want to spend the bulk of this session on Iran, but before we move on to that we want a relatively short exchange about the UK's nuclear deterrent, not whether or not we should have one but the parameters for the debate on how we take this forward.

Q275 Mr Arbuthnot: Prime Minister, you said that it was likely that decisions on the strategic nuclear deterrent should be taken during the course of this Parliament. You have said that there needs to be a public debate about it. When do you intend to begin that debate?

Mr Blair: Well, at the risk of giving a sort of non-answer by saying: "When we are ready to do so", I cannot give you a specific time, but I think we are beginning to get to the point, if you see what I mean. By the end of this year we should have a very clear idea of the timeline, I would say, for it. I know, incidentally, too, that the Defence Select Committee are very interested in this and we are looking at how we can make sure we assist them also in that deliberation.

Q276 Mr Arbuthnot: Would you expect there to be a vote in Parliament about the nuclear deterrent?

Mr Blair: I do not know. We have not committed ourselves on that yet but I always think that these issues - if people really desire to have a vote there is always a way found for them having one. I do not know that we need, specifically, to have a vote - I have not come to a view on that - but I am sure there will be the fullest possible Parliamentary debate and there will obviously be that. It is a huge decision for the country and it will probably be done in a far more open way than the decisions have been taken before.

Q277 Mr Arbuthnot: You are not committing yourself to a vote in Parliament on this?

Mr Blair: I am not committing myself to it but I am not ruling it out either. As I say, I think, in the end, these things have a way of -- that is why I think some of this stuff is somewhat overdone about Parliament not being consulted. The truth is that a decision like this, particularly taken in today's world, is not going to suddenly pop out one day.

Mr Arbuthnot: Thank you.

Q278 Sir George Young: Can we move on to Iran? This is what you have said about Iran: "There has been a long time in which I have been answering questions on Iran, with everyone saying to me: 'Tell us you are not going to do anything about Iran'. If they carry on like this", you said, "the question people are going to be asking us is: When are you going to do something about this? Because you imagine a state like that, with an attitude like that, having a nuclear weapon." You said that three months ago, since when they have "carried on like that". So to answer your own question, when is something going to be done?

Mr Blair: The first step is the reporting to the Security Council. Then there is the fact that the Atomic Energy Board agreed, I think with 27 votes and 3 abstentions, to make that report is an important first step. We have got to discuss with allies how we proceed. The answers are not easy, incidentally, but I think we are in a situation where at least some parts of public opinion are indeed asking: "What are you going to do, rather than give us an assurance you will not do anything?"

Q279 Sir George Young: Would you agree with Senator John McCain, who said over the weekend: "Every option must remain on the table. There is only one thing worse than military action; that is a nuclear-armed Iran"?

Mr Blair: It is a statement of fact in respect of American policy that all options remain on the table.

Q280 Sir George Young: Does that also remain the position for the UK?

Mr Blair: You can never say "never" in any of these situations, but at the same time I have made it clear that we are trying to pursue this by peaceful and diplomatic means. That is our intention and that is our desire. I just think you can get into a sort of argument where people start speculating that people are drawing up plans for military action where they are not. On the other hand, there is a real concern about Iran, at the moment - there has got to be. Not just on the nuclear weapons front, incidentally, but in respect of their support for terrorists.

Q281 Sir George Young: Is there not a risk that the regime in Iran will come to a view that there is no appetite in America or the UK for military action and, therefore, they will just carry on? They will take the view, perhaps, that after Iraq a lot of military and political capital has been expended and there is not the appetite for another confrontation and, therefore, they will just call the bluff and carry on with their programme?

Mr Blair: It would be very unwise to do that. However, I entirely understand why you say that, and I think the President of Iran the other day referred to the Western world as "the mangy old lions who were not up to it any more", or some such. I think they would make a very grave mistake if they did that. However, we shall proceed very carefully. As I say, the report to the Security Council is the first step in that. Iran is not Iraq, although my own belief is that if Iraq becomes a proper stable democracy, as its people want, that will have a huge impact on Iran as well, which is obviously why Iran is not too happy about that prospect.

Q282 Sir George Young: Iran is not Iraq, but if you stood back and looked at the relative threat to stability in the Middle East from Iran and Iraq, you could make the case that actually the threat from Iran was the greater one in terms of proximity to weapons of mass destruction and declared threats of hostility to near neighbours. Is there not a risk that, having exhausted a lot of capital on the one, you have not got the resources to tackle, potentially, the bigger one?

Mr Blair: I do not agree with that. Just think of the Middle East at the moment, with what is happening in Iran, Syria, Lebanon and Palestine, and think if you also had Saddam still in power. It would not be a great prospect; it would not be a prospect that would encourage anyone to think that the situation was going to become more stable. The UN resolutions you had to start somewhere, and Iraq was the place to start. I do not think Iran is Iraq. I think you have got a civic society in Iran and a people in Iran who desperately want to have change, and in any event the nature of the Iranian regime is different. However, you are right in saying it is an increasing concern for all international policy makers, which is why, no doubt, Senator McCain is speaking, and so are others. I think that this can be dealt with through peaceful and diplomatic means, and that is what we are looking to do, but it is interesting that over the past few months I think there has been a change of mood in Europe as well as in the United States, and you have the situation where there is certainly a greater degree of concern and unity in Europe.

Q283 Sir George Young: So was the Foreign Secretary right to say, on January 16: "In the real world the truth is that military action is not on anyone's agenda"?

Mr Blair: It is not on our agenda.

Q284 Sir George Young: Have you not then weakened your negotiating position, if you have ruled it out?

Mr Blair: No, I think the position of the Americans is very clear. You know what the difficulty is, George. If you are not careful, you put a word out of place and people think you are about to go and invade Iran. Then people try and pin you down into saying no matter what happens you are never going to do anything. We all know what that particular game is and it is difficult. The fact is, however, we are pursuing what we are pursuing by peaceful and diplomatic means. However, Iran, I think (and I have said this before), would make a very, very serious mistake if it thinks the international community is going to allow it to develop nuclear weapons capability. There is an additional problem which I think Iran should be aware of, which is that when its President makes statements, such as the ones made about the State of Israel, that then enhances people's concern about the fact of their having nuclear weapons capability. When they are then, in addition, trying to export and support terrorism round the whole of that region, it is a problem. When they are trying to meddle in Iraq, it is a problem. These problems, when they combine together, then give the international community even more concern about whether they can be trusted in respect of the programme that they say is merely a nuclear energy programme.

Sir George Young: I think Mike Gapes wants to pursue this line of argument.

Q285 Mike Gapes: Prime Minister, the Iranians for 18 years were secretly cheating on their undertakings. The Iranian President has made very clear - he talks about "fake super powers" - that the Iranian Government is determined to go ahead with this programme. What, in practice, can we do? Can we actually prevent Iran from developing nuclear weapons?

Mr Blair: If we can bring Iran into compliance with its Atomic Energy Authority obligations then, yes, we can, and that is the right and proper way to do it. Iran says it will comply, but it has done things over the past few months that give people serious cause for concern, which is why the report to the Security Council has happened.

Q286 Mike Gapes: They also got information from the AQ Khan network and they also appear to have a very demagogic nationalistic approach, whereby they argue: "India has nuclear weapons, Pakistan has nuclear weapons, Israel has nuclear weapons, the rest of world has not done anything about that, so why shouldn't we, as Iranians, have nuclear weapons?"

Mr Blair: That is exactly what they do say, which is why people have increasing concern about them. The question is then: "What do you do?" I think the proper step is, first of all, as I say, the report to the Security Council. However, it is difficult to see exactly what the purpose of the Iranian President's rhetoric, which is extremely inflammatory, is. It is very difficult for us to see. My view of this, again, is that I think there is an increasing recognition of the fact that there is a virus of extremism and fanaticism that comes out of the cocktail of religious fanaticism and political repression in the Middle East that has now been exported to different parts of the world, and we can see the impact even here in this country. The recognition, increasingly, I believe, is that we will only secure our own future if we are dealing with every single aspect of that problem out there. That is why I think, in the end, when people look back on it, they will realise that we needed to do Iraq. We do need to ensure that Iran comes into compliance with its obligations; we need to resolve the Middle East peace process and we need to help those countries like Lebanon and other Arab countries that want to move towards democracy to do so. I have a very clear view now which is that our future security depends on sorting out the stability of that region.

Q287 Mike Gapes: Can I put it to you that if the Iranian regime refuses the Russian proposal to have reprocessing carried out on Russian territory, or if it does so under terms whereby they are still allowed to do some nuclear conversion which could still give them a route to a nuclear weapon, even though they were perhaps allegedly complying with international requirements, we could be facing a very clear situation within a relatively short time where this regime, with its rhetoric, with the statements about Israel and so on, has got nuclear weapons?

Mr Blair: That is the risk.

Q288 Mike Gapes: So, in those circumstances, when would it be necessary to take pre-emptive military action?

Mr Blair: As I say, that is not a debate that is being had at the moment, and for all sorts of reasons it is not very sensible to have it. You are right in drawing attention. This is the problem, in the end. I think, as I say, for the first time, people are saying: "Well, what are you going to do about it?" All I am saying, at the moment, is you move to the Security Council, and I think it is important that this is done in a way that does not raise what would be false fears of some military invasion. That is not on anyone's agenda. However, it is nonetheless true that the concern about Iran is growing very, very substantially, and the more that the President of Iran carries on using this type of language, saying what he says about the State of Israel, the more people get worried that the timeline between political change in Iran and their development of nuclear weapons capability gets out of kilter.

Q289 Mike Gapes: Does that mean, then, we are just left with sanctions?

Mr Blair: It means that you take this a step at a time.

Sir George Young: On sanctions, I think Frank Doran wants to pursue that line of argument.

Q290 Mr Doran: Before I get to that, my prepared question was to ask what the UK is trying to do in the present process, but in the answers to Sir George Young and Mike Gapes you seem to have expanded a little beyond Iraq to the whole situation in the Middle East. What is the end game?

Mr Blair: My political view starts from the world being interdependent. I think it is very, very obvious now that the nature of the global threat we face arises out of the combination of circumstances that you have had in the Middle East, and we need a very clear vision and strategy for that region that is about the encouragement of democracy and stability and human rights in every part of it. That is why we are sitting down with states in the Gulf region and working out how we help them towards democracy; it is why it is important to protect Lebanon from Syrian interference in Lebanon's democracy; it is why Iraq stabilising as a democracy is a huge prize, if we can achieve it, and it is why, in respect of Iran, we have to make clear what is acceptable and what it is unacceptable. In respect of the Palestinian issue, we have to be able to take forward this process because, in my view, that is the one issue that has the capability of uniting moderate and extreme opinion on the Middle East in a way that, if we are not careful, is deeply unhelpful to what we are trying to achieve. Therefore, I think it is extremely important within the confines of the two-state solution that we make progress on it. I just think the more you look at what is happening - even if you look at what is happening in Afghanistan, what is happening in Afghanistan is that it is an export, effectively, from that region. If you look at what is happening here or all over Europe at the moment - I do not mean the legitimate and perfectly fair-minded protests but I mean with the small numbers of extremists - it is a virus in the system. We have to confront it from both within Islam and outside it. That is, in a nutshell, the view that I have of how we deal with this. In a sense, what I think is very obvious is the Iranians have a poor (?) strategy. It is not a coincidence that the moment this latest issue has arisen over the cartoons, and all the rest of it, the Iranians have leapt straight into the struggle, trying to be, frankly, as unhelpful as possible about it. It is no surprise to me they have the opposite view; they have the view that it is important that democracy does not get a foothold in that region, because they believe if there is a proper democracy in Iran they would not be in government.

Q291 Mr Doran: It sounds almost like a modern domino theory you are presenting to us. Is it your view that if we resolve the problems in Iran then we can go some way to resolving the other problems in the Middle East?

Mr Blair: I think if you work towards a clear strategic vision in the company of the modernisers that there are within that region then, yes, I think we are well on the way to sorting out our own long-term security, if you believe, as I believe, that it is this religious fanaticism based on a perversion of the proper faith of Islam that is driving this.

Q292 Mr Doran: We move on to the question of sanctions. Most commentators think that it is unlikely that you will get a unanimous decision in the Security Council for sanctions because of the vested interests of the Chinese and, perhaps, the Russians as well. That leads to the possibility - you are not ruling out military action and I understand why you do not want to talk about it at the moment - that we will appear fairly powerless in front of the Iranians. Is there any prospect that the UK, if there is no UN decision in favour of sanctions, will side, for example, with the Americans who are already imposing sanctions, and try to get a coalition to effect economic sanctions against Iran?

Mr Blair: Again, as I say, one of the benefits of this process has been that the Germans, the French and the British are working very closely together and with the Americans. I think we want, as far as possible, to stick together, and that is what we will try to do. As I say, I cannot predict what might happen further down the line, but I certainly think, for the moment, we are working on a path where we keep everyone together. I think one of the interesting things about this is that there is a greater degree of transatlantic co-operation on this than I have noticed for some time. Indeed, I think it is somewhat bringing in a different relationship on a whole series of issues as a result of that.

Q293 Mr Doran: Just one final question: on the question of sanctions it is very difficult to see what economic pressure we can put on Iran that does not harm us as much as it harms them, particularly on the oil front. Have you made any assessments of the impact - the economic impact, in particular on the oil price - if there were to be economic sanctions against Iran?

Mr Blair: It is a factor we take into account, obviously, but it is not so much a specific assessment because we have not got to the stage of assessing what action we might take but I suppose what that does, again, is indicate why it is so important that in respect of energy policy Europe has a more concerted view. I think one of the things that is happening round the world today is that energy is being used as a political lever in a far more pointed way than I can remember for several decades.

Q294 Mr Doran: Do you accept there would be a serious consequence?

Mr Blair: It depends on whatever we might propose and it depends on what the Iranian response is. Obviously, they have a certain position within the energy market but that should not, in my view, deter us from taking action if that is where we get to. The reason I am being somewhat coy here is we made this report to the Security Council but we are not at the stage yet of agreeing what we are going to do and I do not want, obviously, when there are discussions going on as to what we might or might not do, to start committing myself and getting everyone in trouble.

Sir George Young: Thank you. Can I bring in Andrew Miller?

Q295 Andrew Miller: Can I take a step back to some of Mike Gapes' questions and then pose them to you in the context of some of the issues around technology transfer in the energy industry, and particularly in respect of nuclear power, and then some of that spills over into nuclear weapons, obviously. It is a rather important issue in my neck of the woods, with Capenhurst just down the road from us. Just put the debate into perspective. What is your estimate of how long it would take Iran to acquire a nuclear weapon with their current technologies?

Mr Blair: I do not know, Andrew.

Q296 Andrew Miller: We are assuming they have started enrichment processes.

Mr Blair: I am not an expert on this and you would have to ask the Atomic Energy Authority. The trouble is that no one quite knows what stage they are at. Someone mentioned earlier AQ Khan, and that network, fortunately, has now been shut down. Obviously, there is a worry, too, about the capability of buying expertise from outside. People always assume this is something countries develop within their own country, but, as the AQ Kahn network showed, there is an export market in this, and we have to be careful of that as well.

Q297 Andrew Miller: Does the proposed or speculated Russian intervention prevent any further technology transfer to Iran?

Mr Blair: No. I think people are willing to have a close look at what the Russians were offering, but I think, as the Russians themselves have now said, they are worried about what the Iranian intentions really are. One of the worries, as Mike was quite rightly saying earlier, is if they then start refusing what appear to be perfectly reasonable offers in order to give reassurance to people, then you wonder why they are refusing them. So that then increases people's anxiety.

Q298 Andrew Miller: There is obviously a huge risk, as we share technologies around the world to help in the energy debate, that there will be some disadvantages spilling out from it. Of course, EURENCO's work, from where the leak occurred (fortunately, not our part of EURENCO but in Holland where the AQ Khan network was focused) under the Treaty of Almeno (?) is focused upon power, it is not focused upon nuclear weapons. Are you confident that there has been a complete close-down of risks like that within the international community?

Mr Blair: I do not think we can be fully confident at all, not when you have still got countries like North Korea operating in the way that they are. I think the AQ Khan network we can be relatively sure of. Libya has, as we are clear about, given up its nuclear/chemical weapons ambitions. Other countries who have potential in this area have been dealt with and, obviously, Iraq. No, there is a market in this internationally. The one thing I would say is that post-September 11 the counter-proliferation initiative has had some success in trying to deal with those networks, but you have got to watch this the whole time. The trouble is, if you get a highly unstable regime whose leaders use the type of rhetoric that Iran has used about Israel in the past few months, which, after all, is a pretty extraordinary thing to say about another state - that you, literally, want to wipe them off the face of the map. This is my point, really: in the end I have come to the conclusion that your only long-term stability is when you are dealing with a regime that is properly accountable to its people who, I have no doubt, want to get on with their lives and live in peace. But it is a worry when you have got a country saying these things, and prepared to operate in this way. That is why we are having the debate we are having.

Sir George Young: We may want to come back, if we have a moment later on, about the role of Parliament and public opinion in this country on where we go next on Iran. Can we just have a session on Hamas and the elections in Palestine?

Q299 Mr Sarwar: Was the Prime Minister surprised by the resounding victory of Hamas in the recent elections? Can the Prime Minister outline what kind of diplomatic contacts the UK Government will have with a Hamas-led government?

Mr Blair: Well, as the election went on I think we were increasingly less surprised by the result. Democracy is democracy. That is what people have said in Palestine and we should understand, maybe, some of the reasons why they have said that. We have said we will not be able to have contact with an Hamas-led government unless it is clear that they are prepared to forswear that part of their constitution that says they want rid of the State of Israel and that they are prepared to embrace democratic and not violent means of achieving an independent, viable Palestinian state - which we want to achieve, incidentally. It is important that we get it, but if they do not make those changes that will stand in the way of us being able to help.

Q300 Mr Sarwar: Prime Minister, I can understand that, but is it right for the international community to sit and watch the deteriorating humanitarian situation under a Hamas-led government?

Mr Blair: No, I think what is important is that we find a way of ensuring that we can help the people, whatever happens, but it is very difficult for us to help the government, as such, if the government is committed to the abolition of the State of Israel. If the leadership of Hamas - and, obviously, there will be a debate going on within that leadership as to what to do - have the imagination I have no doubt at all that America and the world community want to take this process forward. If Hamas were to change is policy on the abolition of the State of Israel and embrace the democratic way forward, I have no doubt at all that America and the rest of the international community would stand ready to help them achieve what the Palestinian people want, but it has got to be on that clear basis. Otherwise the danger is here are we saying - and it is a consensus now - "We want a two-state solution", and you have got one of the partners to that saying: "But actually we don't; we want a one-state solution". I believe that the overwhelming majority of Palestinian people (and I think there is some evidence to indicate this) whatever reasons they had for supporting Hamas, did not actually support them in order to get rid of the State of Israel - they may have supported them for all sorts of different reasons. Therefore, I think if Hamas have a real political leadership and imagination they can make the change and they should understand if they do make that change the international community stands ready to partner them.

Q301 Mr Sarwar: Prime Minister there is an old saying that opposition parties do not win the elections; governments lose them. It might be the case that the failure of Fatah to root out corruption from society has helped Hamas to win the election. But if we do not engage ourselves with the Government of Palestine and do not respect the democratic will of the people then what kind of messages will we be sending to the Muslim and Arab world about our commitment to democracy?

Mr Blair: I totally agree, Mohammed. It is a very, very difficult question this, because we have to respect the mandate; they have voted, quite possibly for the reasons you say, in the way that they have; we cannot ignore that, that is a democratically-established mandate. The problem is what do we then do? Now, my point is this: that if they want our help, both financially and to take the peace process forward, we have to have a clear understanding of the basis of that, and the basis is a two-state solution, the existence of Israel respected and an independent, viable Palestinian state. We are prepared and President Bush is prepared - I have talked this through with him very closely indeed - to move this whole process forward, and wants to move it forward, but it is hard to do that if one of the main two parties to the process is saying: "Actually, we want rid of the other party". I hope and believe that they can exercise the political leadership to change that but otherwise it is going to be very difficult. It is difficult for Europe, and Europe puts £500 million a year into the Palestinian Authority; it is hard for us to put that money in to the actual Authority itself in circumstances where the Authority is saying: "We neither renounce violence nor the desire to get rid of Israel". So I think what has got to happen is that the pressure is put on, in part, as you rightly imply, from the Arab and Muslim world, to say to them: "This is your chance. You have got your democratic mandate, people respect that, but if you want our help - in other words, we have got to step up to the mark - we can only do that on these terms."

Q302 Mr Sarwar: Prime Minister, the participation of Hamas in the democratic process may be a step further towards disengagement from the violence. Of course, I want to see Hamas renounce violence and accept the existence of the State of Israel but, according to The Financial Times, more than 50 per cent of the Israelis believe that their government should talk to the Hamas-led government. Do you not think it is incumbent on the international community to follow, and that greater isolation of Hamas-led government might further radicalise the situation (?)?

Mr Blair: You are expressing what is the conundrum when you are dealing with a situation like this. The real point I would make is this: that I think everyone wants to engage with Hamas because they recognise they have established a democratic mandate. The problem is quite simply this: that if you engage with them in circumstances where there is some ambiguity about the terms upon which we can take this forward, I think that does no one any favours. I agree there is a battle over what some parts of Arab and Muslim opinion may say is: "You are not respecting the democratic mandate" but I am making it very clear, and I want to repeat this publicly here, we entirely respect their democratic mandate, we stand absolutely ready, willing and able to take this process forward with Hamas, provided that it is clear what this process is about. It is about a two-state solution and you cannot have a two-state solution if one partner in that process wants to get rid of the other state. If we can shift that so that they embrace (which I think everyone else understands has to happen) the recognition of Israel and embrace democratic and non-violent means to achieve it, we stand ready to do it. I think the most frustrating thing about the whole Middle East peace process is it is obvious from what is happening in Israel that actually Israeli opinion does want a two-state solution. However, you can imagine Israel is not going to feel confident of its security if the state that is created next door is saying: "We want rid of you". That is the problem. Therefore, in the end, what is this? We all of us are familiar with the shibboleths within our own parties. I cannot really believe that the Hamas leadership is foolish enough to think that anyone is ever going to get rid of the State of Israel. So the best thing for them to do, as actually with much of the Arab world, is simply to accept the reality; there is going to be a State of Israel. Accept it, agree that the Israelis can be confident of that and then we can all get on with what we want to see. After all, the international community now has a consensus for the first time of a two-state solution.

Sir George Young: Can we come back to the subject I touched on a moment ago, about Parliamentary involvement in the broader Middle East debate?

Q303 Mike Gapes: Prime Minister, in 2003 we had a vote on March 18 before the military action in Iraq, and before then there was a process of involvement of the Members of Parliament which was unprecedented before any military action. Can I have your assurance that if we get to a question of possible military action with regard to Iran that we will have a similar process and that Members of Parliament will be able to make that decision?

Mr Blair: Before I answer that I had better make it clear that in respect of any military action - and I am certainly not saying there is going to be military action in respect of Iran - the reality is, which is why, I think, with great respect to other political parties, you can overdo all this stuff about the Royal Prerogative. The fact of the matter is that I cannot conceive of a situation in which a government (and I think I have said this before, even here) is going to go to war - except in circumstances where militarily for the security of the country it needs to act immediately - without a full Parliamentary debate. Actually, as I say, the irony is, although people keep talking about this as a result of the Iraq conflict, I think the one thing you could not say is that we did not have a full Parliamentary debate or that we did not have a vote - because we did. I think the reality is that that is the way it will happen in practice, unless you have a circumstance where you need to act urgently.

Q304 Mike Gapes: Do you, therefore, accept that because of what happened in 2003 and the importance to keep public support, that the days when a British Government could do what we did, for example, over the Falklands have definitely gone for all time, and from now on Parliament will have a say on these issues?

Mr Blair: I think, to be fair again, Parliament probably - this was a Saturday ----

Q305 Mike Gapes: After the event.

Mr Blair: I thought they met on the Saturday. I cannot really remember.

Sir George Young: We were recalled on the Saturday.

Q306 Mike Gapes: Parliament at that time was recalled.

Mr Blair: As I say, I think one of the ironies of the situation is despite us, as a political class, continually saying that Parliament is bypassed, etcetera, etcetera, etcetera, we have discussed two things, namely the renewal of our nuclear deterrent and potential military action, in which I would suggest there is a higher probability of extensive Parliamentary debate now, today, than there ever would have been 30, 40 or 50 years ago.

Q307 Mr Arbuthnot: I was just going to come on to that. You almost committed yourself there to a vote because of the reality of the situation would be that any action on Iran would be -----

Mr Blair: I am not talking about Iran specifically - I just want to make that clear. I do not want to be suddenly - not that I am sure I would be misinterpreted in any way at all by those sitting behind you.

Q308 Mr Arbuthnot: Yet you expressly refused to commit yourself to a vote on the issue of the nuclear deterrent. Do you not find that rather odd?

Mr Blair: I have not committed myself to it. I understand the argument. All I am saying, though, is, James, on any basis we debate these things a lot more extensively in public than actually we did 40, 50 years ago. Which is why I actually think, when we are talking about Parliament and so on - and, incidentally, of course, this is the first time Prime Ministers appear in front of the Liaison Committee - there is a myth about bypassing Parliament which is to do with bypassing Parliament because of politicians and what we are not actually looking at is the real reasons why there is a problem in Parliament today, which in my view is somewhat different. Anyway, that is another argument which we can come to at another time, maybe.

Q309 Mr Arbuthnot: So do you really agree with Ken Livingstone's view that if voting changed anything they would abolish it?

Mr Blair: You gave me a bit of a shock there. Come again? What was that? I am sorry, James. Go on. What was it Ken Livingstone said?

Q310 Mr Arbuthnot: I said Ken Livingstone's view was that if voting changed anything they would abolish it. I wonder if that is a view that -----

Mr Blair: I think that was before he ran for re-election.

Sir George Young: Can I bring in Edward Leigh on something you mentioned a few moments ago, which were the protests?

Q311 Mr Leigh: You have taken me to task when I have criticised you over the invasion of Iraq. You said that there are people who hate our way of life so much that whether we had invaded Iraq it would have made no difference. So what are we going to do about what happened in London last week? There is a feeling in the country that if other groups of people had gone around central London talking about beheading people and dressing as suicide bombers, that the police would have gone straight in under public order legislation - existing legislation, so they obviously have the powers - but somehow they were treating people with kid gloves. Maybe there were double standards; maybe they were frightened of being accused of being racist or attacking Muslims. There is a feeling in the country, is there not, that this was an intolerable situation.

Mr Blair: There is a feeling, I think, entirely justifiably, of outrage when people see some of the placards that were there. I am very pleased that leading members of the Muslim community have expressed their abhorrence along with everyone else in the country. The police had a difficult situation to manage on the day. I think it is perfectly sensible for them to say: "Look, we want to study the evidence and come to conclusions", but let me make it absolutely clear, the police will have our full support in any prosecutions they mount, but that is for them to decide. You are right; I think there is a real sense of outrage. I think what is more healthy about the situation, though, (and I think it is very, very important that we emphasise this the whole time) is that that sense of outrage stretches across all communities. In my view there is a real issue about how the sensible, moderate Muslim leaders go into their community and confront this type of extremism, and that is something we discuss with them continually. However, it is very important for our overall good relations in this country that people understand there is no political correctness that should keep the police from taking whatever action they think is necessary. That is my position one hundred per cent.

Sir George Young: Unless other colleagues wish to come in, Chairman, we have finished our session.

Q312 Chairman: Thank you. Prime Minister, it is interesting to reflect way back into history when I was last here enjoying the joys of office in government, and in the late-1970s I sat on a Cabinet Committee looking at proliferation. At that time we were trying to work out how to frustrate the aspirations of the then Shah who was going to get in on the early days of nuclear capability. So it may not just be a regime factor. Our next session is due to be towards the end of the year. Can I just put up a flag? I will not ask you to commit yourself now but I ask you to take this away and think about it. This is the only Parliamentary Committee to which the Prime Minister comes, and we are grateful to you for the fact you have introduced this innovation. Can I ask you (and, hopefully, it will not arise) if between now and the time of the next session there were to be a dramatic deterioration in the situation in Iran, would you consider having an interim, briefer meeting - say, an hour to an hour-and-a-half - with this Committee, where we could have the same sort of exchanges as we have had today in reflection of this international situation? I do not want you to commit yourself, but go away and think about it.

Mr Blair: I am very happy to think about it, but I do want to emphasise there is nothing that should make people anticipate that something is about to ----

Q313 Chairman: When the US says: "We will not rule out the use of military force" one has to note that it was not gunboat diplomacy the last time they said it! Thank you, Prime Minister. It has been a very interesting exchange. Thank you very much.

Mr Blair: Thank you.