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Mr. Eddie McGrady (South Down) (SDLP): Will the Secretary of State inform the House whether, over the past two years, he has had negotiations or discussions
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with the Ulster Volunteer Force, the Ulster Defence Association, dissident republicans and other such groups, for the purposes of obtaining ceasefires and decommissioning? If not, what has led to the change of Government policy and strategy?

Mr. Woodward: Again, the figures demonstrate the huge elements of progress that have been made. Whether we are talking about dissident republican activity or dissident loyalist activity, to which the hon. Gentleman referred, regrettably there are still elements out there who wish to behave in a criminal way. There is, of course, as the last IMC report indicated, more that needs to be done through action, and not just words, by dissident loyalist groups, but I look forward to receiving the next IMC report, which I am confident will show that further progress has been made.

Rev. Ian Paisley (North Antrim) (DUP): Will the Secretary of State make a statement on the serious rioting in Londonderry at the weekend? When illegal parades on the Protestant side of the community take place, an attempt by the police to stop those involved from gathering is usually successful, but it seems that in the incident in question people could gather. In fact, for the first time in a very long time, 40 petrol bombs were recovered by the police, and there was a savage attack on the police in Londonderry. Would the Secretary of State not think it better, at this time, to concentrate on helping the police, rather than to enter into an engagement on whether power should be devolved to Stormont? Any organisation that has an army council associated with violence should not have anything to do with the police.

Mr. Woodward: I think that this is the first chance that I have had since the right hon. Gentleman announced that he will stand down as First Minister in May to put on record in the House what a huge debt the House owes him for the work that he has done, both in leading his party and as First Minister.

On the events that the right hon. Gentleman mentioned in Londonderry, I think that no sensibly minded person would do anything, in any shape or form, other than condemn the behaviour on the streets over the weekend. Petrol bombs and attacks on the police are a thing of the past and should be utterly condemned. I remind all hon. Members that this weekend Sinn Fein were as strong as any in condemning the activity that took place. He is right to talk about the importance of devolution of policing and criminal justice, and to point out the attention that the Government continue to pay to the issue. I just say to him that, while I condemn without reservation the behaviour of those criminals on the streets in Londonderry this weekend, I make no apology for continuing to encourage momentum on devolution, because that is the best way for us to secure long-term peace on the streets of every part of Northern Ireland.

Criminal Justice and Policing

5. Miss Anne McIntosh (Vale of York) (Con): If he will make a statement on the progress of devolution of criminal justice and policing to Northern Ireland. [195501]

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The Secretary of State for Northern Ireland (Mr. Shaun Woodward): Since May last year, huge progress has been made in Northern Ireland, not least with the publication of the Assembly’s progress report, which I laid before Parliament yesterday. Perhaps there is no better indication of the progress made in Northern Ireland than the visit last week by Her Majesty the Queen, who was able for the first time to attend a maundy service there—and, even more significantly, a maundy service in Armagh.

Miss McIntosh: The St. Andrews agreement is due to come into effect in May, and criminal justice and policing in particular go to the heart of that agreement. We have just heard that there may well be reasons why that deadline is not met. Will the Secretary of State meet that deadline, and if not, what does he expect will happen?

Mr. Woodward: The St. Andrews agreement began in May last year with the first stage of devolution, and I am pleased to report just how successful in all the areas where devolution has taken place the power-sharing Government have been. There remains the second stage of devolution, which in the agreement was envisaged to take place this year, hopefully in May. However, the hon. Lady rightly asks whether we will be able to complete it. The Government will have completed their promises and their arrangements, so that when the Assembly and the Executive have cross-community support and ask for devolution to take place, the Government will be able to fulfil their promises and objectives.

David Simpson (Upper Bann) (DUP): The Secretary of State will be aware of the comments made by Mary McAleese, the President of the Republic of Ireland, when she said that Her Majesty the Queen could be invited to the Irish Republic only when policing and justice powers were devolved. Does the right hon. Gentleman agree that that statement was scandalous and shameful?

Mr. Woodward: I understand the emotions that are inevitably raised on the issue, and I understand the comments made by the hon. Gentleman, but the comments made by President McAleese last week must be seen in the context of a reply to a question from a journalist. They were heartfelt and they followed what had been said by the Taoiseach. Let us be clear. A visit by the Queen to the Republic will be agreed between the Palace and the Irish Government, and it will be a matter decided upon by the Queen at a time of her choosing.

Mr. Owen Paterson (North Shropshire) (Con): The key to devolution of policing and justice is to build cross-community confidence. What discussions has the Minister had with senior members of the republican movement to ensure that the IRA army council is disbanded?

Mr. Woodward: The hon. Gentleman is right to talk about cross-community support. As he knows, recent polls in Northern Ireland have consistently shown that a majority of people not only support the devolution of policing and justice powers, but that they support that sooner rather than later, and that a majority would like it to be in May this year. On the specific question about
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discussions with republicans about the future of paramilitary structures, let me be equally clear. All the paramilitary structures, the army council included, are vestiges of the past. It would be better if they were gone this afternoon, and the sooner any leaders in any party can bear down on getting rid of the vestiges of Northern Ireland’s paramilitary past, the better.

Mr. Paterson: Actions speak louder than words. What steps is the Minister taking to encourage full republican co-operation, which is essential to solving the McCartney and Quinn murders and would go a long way to encouraging Unionists to support devolution?

Mr. Woodward: The hon. Gentleman is right; actions do speak better than words, which is why we are seeing an unprecedented level of co-operation between the community and PSNI precisely in areas where, for example, the terrible Quinn murder happened, as the hon. Gentleman is aware from his own discussions with the Chief Constable. Further to that, let me say once again to the hon. Gentleman that none of those structures, the army council included, has any place in tomorrow’s or even today’s Northern Ireland, and I welcome his support in joining me to apply pressure wherever it can be applied to ensure that those paramilitary structures belong in the dustbin of history.

Mr. Jeffrey M. Donaldson (Lagan Valley) (DUP): Surely the greatest leverage that the Government can apply on the republican movement is to insist that the army council is removed before there is devolution of policing and justice. That is the one lever that the Government have, and instead of putting it up to the political parties in Northern Ireland, is it not time that the Government used their position and influence to press for that and insist on it before there is any question of further devolution?

Mr. Woodward: Let me put on record again my thanks to the right hon. Gentleman for the work that he has done with his Assembly and Executive Review Committee over the past six months to prepare the political parties of Northern Ireland for devolution. It is perfectly clear that he shares with all other hon. Members the view that there is no place in the future for any vestiges of paramilitary activity. He knows as well as I do that it is intention that matters. For that reason, I urge him to be careful about setting pre-conditions and to remain focused on intent and on building cross-community confidence. I remind him of what he said about policing and criminal justice only last week:

Provisional Army Council

7. Mr. Andrew Robathan (Blaby) (Con): What assessment he has made of the likelihood of the Provisional army council disbanding. [195503]

The Secretary of State for Northern Ireland (Mr. Shaun Woodward): I am sure that everybody looks forward to the day when all vestiges of Northern Ireland’s paramilitary history, including the army council, have been relegated to where they belong: the past.

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Mr. Robathan: The Provisional army council is not some branch of the Royal British Legion, but a terror command structure. Given that the Government’s policies have put terrorists and murderers into government in part of the United Kingdom, and given that the self-same people were and may still be members of that terror command structure, how can the Secretary of State even contemplate having them in charge of policing the criminal justice system?

Mr. Woodward: I am sorry to disappoint the hon. Gentleman, but he will know that the Belfast agreement, subsequently built on by the St. Andrews agreement, enables the politicians and people of Northern Ireland to determine their future. As such, we built into the St. Andrews agreement that it would be for the parties to agree on the matter, that it would be an issue of cross-community confidence, and that when a motion was brought before and agreed by the Assembly, it would finally have to come before this House before we could move forward on devolution.

As for the idea of terrorists being put into positions of power, I simply say this to the hon. Gentleman: all those members of the Executive have taken an oath of office, and they are required, both now and in future, to live up to that oath.

Prime Minister

The Prime Minister was asked—


Q1. [196463] Gwyn Prosser (Dover) (Lab): If he will list his official engagements for Wednesday 26 March.

The Prime Minister (Mr. Gordon Brown): This morning I had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall have further such meetings later today.

Gwyn Prosser: No one knows better than my constituents the huge effects that cross-channel co-operation and our new border controls have had on clamping down on illegal immigration, but there is more work to be done. What will my right hon. Friend be discussing tomorrow with our new friend, President Sarkozy, to continue the work of improving and reforming our immigration schemes, to strengthen our economies and to get a grip on the militants at Calais— [Interruption.]

Mr. Speaker: Order.

The Prime Minister: Let me first of all thank my hon. Friend for his question, and welcome President Sarkozy and his wife to Britain. I believe that our talks in the next few days will be very constructive. My hon. Friend is absolutely right about illegal immigration and I hope that in our talks today and tomorrow, the President and I can agree to tighten up controls at Calais. I hope also that we can have an agreement that there will be no further immigration centres like Sangatte, and that they will not exist in the future. Given the present global financial turbulence and the
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fact that in one country in the last day interest rates have moved to 15 per cent., I also believe that it is right that France and Britain agree measures, which we can put to the international institutions over the next few days, that will strengthen the stability of our economies, deal with problems of lack of transparency in financial information and make sure that the European economies can continue to grow together. That is possible only because we want a Britain at the heart of Europe and not detached from Europe.

Mr. David Cameron (Witney) (Con): I join the Prime Minister in welcoming President and Mrs. Sarkozy to Britain.

It is now nearly eight months since the start of the credit crunch, and one of the key questions is how well prepared we are. Does the Prime Minister now accept that in terms of financial regulation, the UK has been shown to have some serious failings?

The Prime Minister: We have already looked at some of the changes that can be made, both in the Financial Services Authority—there is a report of the Treasury Committee today—and in the Bank of England. But if I may say so, if the right hon. Gentleman now looks around the world and sees what happened to Bear Stearns, sees that three banks have fallen in Germany and sees what happened to Société Générale in France, he will realise that we have been better protected than other countries against the global financial turbulence, and that that is precisely because we did not take the Opposition advice that would have caused instability.

Mr. Cameron: People around the world are making a contrast between Bear Stearns, where a rescue was organised in just a few days, and Northern Rock, where there were months of dithering. I know that the Prime Minister created the regulatory system, but he needs to be frank about its failings. Today’s FSA report is a remarkable report, which says:

yet not a word about that from the Prime Minister. The director general of the CBI says that this was the first new test of the tripartite system, and it failed to deliver the goods. So that we are better prepared in future, does the Prime Minister agree that the Bank of England, not the Financial Services Authority, should be in charge of rescuing banks that fail?

The Prime Minister: First of all, until a few weeks ago the right hon. Gentleman supported what we did on Northern Rock, so it makes no sense for him to criticise now. Secondly, as far as the Financial Services Authority is concerned, it is true that it has been regulating for solvency, and it has done a good job. The problem arose in terms of liquidity, and that is where further efforts have got to be made. That is true, as the President of America’s report is saying, for the American financial system, and it is true of the French and the German financial systems as well. All countries are realising that more has to be done to protect against illiquidity, and they also know that there has to be greater transparency in the financial system. I repeat: the lessons that are being learned are being learned around the world.

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The Conservative party published a document in the past two days saying that far from Britain doing badly, real living standards in Britain among pensioners had risen by £1,500 since 2001; for single women pensioners, by £1,000; and for couples, by £700. That is on page 16 of the Conservatives’ own document.

Mr. Cameron: I tell you what that document said: it said that since this man became Prime Minister, the price of milk is up 17 per cent., the price of eggs is up 28 per cent. and the price of bread is up 34 per cent. That is the real cost of living under Labour.

In his answer, the Prime Minister said an extraordinary thing—that the Financial Services Authority has done a good job. What he has not read is the report out today by the Financial Services Authority that says:

Are not those the absolutely key things that are needed to be a regulator? Is not that why the Bank of England should be in charge of these rescues rather than the Financial Services Authority? The Chancellor— [ Interruption. ] They do not like to hear the extent of the failure of the system put in place by the Prime Minister. The Prime Minister and the Chancellor have made several U-turns recently; why do they not make one more U-turn and make the Bank of England responsible?

The Prime Minister: I know what the chairman of the right hon. Gentleman’s defence commission, Frederick Forsyth, meant when he said that David Cameron has a

because he does not understand what is happening. The FSA has admitted that it must do more about liquidity problems, but every financial organisation around the world that is regulating markets is accepting the need to do more. He would be better addressing the real problems that we face—off balance sheet activities, write-offs that have not been properly declared, and credit rating agencies that have done the job of being advisers as well as raters. Those are the problems that have got to be addressed. Instead of just blaming the Financial Services Authority, he should look at the real problems that President Sarkozy and I will address. The real problems will not be solved by someone who has no basic grasp of arithmetic. [ Interruption. ]

Mr. Speaker: Order. The Leader of the Opposition.

Mr. Cameron: It is time that the Prime Minister and the Chancellor— [ Interruption. ]

Mr. Speaker: Order. The Leader of the Opposition.

Mr. Cameron: It is time that the Prime Minister and the Chancellor realised that one of the real problems facing Britain is their economic mismanagement. It is frankly pathetic to listen to the Prime Minister of the United Kingdom read out quotes from a novelist when he ought to be reading out from the Financial Services Authority’s report. A key point in terms of how well prepared we are is the size of the Government’s budget deficit. Out of 55 major world economies, only three
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economies have a bigger budget deficit than Britain. That is why he is putting up taxes. Most other countries are helping families with the cost of living; this Government are hitting them. Can he name one other major country that has just introduced a Budget putting up taxes? Name one.

The Prime Minister: We are injecting more money into the economy this year. We are not taking money out of the economy; we are cutting the basic rate of income tax to 20p. Let us compare what was happening during the last world downturn: 15 per cent. interest rates, 10 per cent. inflation, 3 million people unemployed, public spending being cut, and taxes rising dramatically with VAT on fuel. Let us compare that with what is happening now: we have low inflation, low interest rates, the highest levels of employment in our history, unemployment at its lowest since 1975 and public services continuing to expand. If the right hon. Gentleman does not accept that today, he should remember that he said on Monday on BBC Radio London:

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