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Nick Harvey: I thank the hon. Gentleman for his remarks. We are grateful to those members of staff who battled in against the weather conditions and to those who worked extra hours. The House takes business continuity very seriously and has done everything possible to learn the lessons of last winter.

Leader of the House

The Leader of the House was asked-

Members' Expenses

25. John Mann (Bassetlaw) (Lab): When proposals will be brought forward to implement Sir Christopher Kelly's recommendations on hon. Members' expenses; and if she will make a statement. [312141]

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The Parliamentary Secretary, Office of the Leader of the House of Commons (Barbara Keeley): In relation to those recommendations of the Committee on Standards in Public Life that were identified as requiring legislation, a written ministerial statement was made by my right hon. and learned Friend the Leader of the House on 10 December 2009 detailing the Government's proposals for legislation. The House will have the opportunity to debate those proposals shortly.

John Mann: We have now got a real dog's breakfast from Sir Ian Kennedy, who has come up with a series of proposals that totally contradict Sir Christopher Kelly. Kennedy clearly does not understand the role of an MP-how he perceives it is more than 30 years out of date. Why are we not implementing Kelly's thought-through proposals in full, so that we can move beyond the problem of MPs' expenses?

Barbara Keeley: MPs did decide not to decide on their own allowances. We have legislated to make the Parliamentary Standards Authority independent, and that body is consulting. I note my hon. Friend's strength of feeling on the issue, but that body is two or three weeks into its consultation. If he has strong concerns, which he clearly does, I would urge him and other right hon. and hon. Members to get involved in that consultation and tell the independent authority what they believe should be happening.

Mr. Edward Leigh (Gainsborough) (Con): Does the deputy Leader of the House agree that if we are to build on the progress that we have made over 25 years in enabling women in particular to live with their families both in London as Members of Parliament and in their constituencies, it is vital that we should have an allowance system that facilitates that? Moving to a system whereby new Members would be forced to live in tiny state-run flats in London would not help families to stay together in London and their constituencies.

Barbara Keeley: As I have just pointed out, Members have opinions and comments that they want to make, and it is important that they should do so. Sir Ian Kennedy and some of the other IPSA board members were here for a meeting with Members on Monday. They are due to have three other meetings as part of their consultation. I urge the hon. Gentleman to make his points in one of those meetings or in writing, whichever he prefers.

Natascha Engel (North-East Derbyshire) (Lab): I want to add my voice to the concerns expressed about weakening Christopher Kelly's proposals, which were welcomed by every person in this House-well, most people. The proposals outlined by the Independent Parliamentary Standards Authority weaken his proposals on travel, employing relatives and the capital gains allowance. My hon. Friend really must keep an eye on the proposals coming out of IPSA, because they are deeply concerning to everybody.

Barbara Keeley: I have to keep re-emphasising that that body is independent. This is not the place to debate such matters. The place to talk about them is in the consultation, either in writing or at meetings; it is not in this Chamber.

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Tony Baldry (Banbury) (Con): Can the deputy Leader of the House explain to some of her colleagues that if Sir Christopher Kelly does not hold a proper consultation, any decision that he makes thereafter will be at risk of being challenged by judicial review? It is therefore in everyone's interest that, for future certainty, there should be a proper consultation, so that whatever proposals emerge are not vulnerable to being struck down by judicial review.

Barbara Keeley: Yes, indeed. The consultation process that is being embarked upon is statutory. The Parliamentary Standards Act 2009 says which Members are to be consulted, but in addition to the specific consultees who are listed, for the first time there will also be a substantial consultation with the public. The public can express their views, Members can and should express theirs, and I urge people to take part in that consultation.

Private Bills

26. Mr. Peter Bone (Wellingborough) (Con): If she will bring forward proposals for amendments to Standing Orders to reduce the number of private Bills introduced in a parliamentary Session. [312142]

The Parliamentary Secretary, Office of the Leader of the House of Commons (Barbara Keeley): Private Bills
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enable individual local authorities to obtain legal powers that are additional to those generally given to them. Reducing the number of private Bills would mean denying that facility to local authorities or other bodies. Private Bills are also needed to deal with those bodies that are established under private Acts such as the Crossrail Act 2008 and the Channel Tunnel Rail Link Act 1996, which can be amended only by private Bills. I therefore have no plans to bring forward changes to Standing Orders.

Mr. Bone: I regret the response of the deputy Leader of the House. She is quite correct that large-scale projects such as the channel tunnel should be dealt with through private Bills. However, a lot of cities are currently trying to change the law on pedlars through private Bills, which is wasting parliamentary time. This afternoon we will spend another three hours on such Bills. Their number should be limited.

Barbara Keeley: I have figures for the length of time that was spent on private Bills in the 2007-08 Session: it was less than 0.5 per cent. of our sitting time. I am slightly surprised that the hon. Gentleman cannot see the benefits of a localised approach that gives specific powers when they are needed. There tend to be only three or four private Bills each year, and they do help local authorities when they have specific issues.

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Exchange Rate Movements (FCO)

11.30 am

Mr. David Lidington (Aylesbury) (Con) (Urgent Question): To ask the Foreign Secretary if he will make a statement on the impact of exchange rate movements on Foreign and Commonwealth Office programmes.

The Minister for Europe (Chris Bryant): I am grateful for this opportunity to make a brief statement. The total Foreign and Commonwealth Office budget comes in at roughly £2 billion, of which only £830 million is discretionary spend, as £1.1 billion is spent on subscriptions to international organisations, peacekeeping and counter-conflict funding, the BBC World Service and the British Council. There are significant challenges to the Foreign and Commonwealth Office budget, not least because 50 per cent. of it is spent in foreign currency, and exchange rate volatility has made it difficult for the Foreign Office.

My right hon. Friend the Foreign Secretary said in a reply to the right hon. Member for Richmond, Yorks (Mr. Hague) on 7 December 2009 that the estimated impact, including that relating to the overseas pricing mechanism, comes to over £100 million in the financial year 2009-10. There has been quite a lot of speculation about what this means for counter-terrorism. The FCO's overseas counter-terrorism budget has increased significantly in recent years. In 2008-09, it was £35 million; in 2009-10, we will be spending £36.9 million, and we are projected to spend around £38 million in 2010-11.

Mr. Lidington: What the Minister failed to confirm-I hope he will do so in a moment-was that his noble Friend Baroness Kinnock explained to the House of Lords yesterday that the Foreign Office was cutting its expenditure on counter-terrorism programmes in Pakistan and on anti-narcotics programmes in Afghanistan, not through any reassessment of strategic priorities but because of the movement of exchange rates and the Government's overall debt crisis. That is not the way to run an effective foreign policy. It is appalling that, yesterday, we had the spectacle of the Prime Minister standing in the House of Commons talking about fighting terrorism, while at the same time in the House of Lords, his Minister was admitting that debt and exchange rate problems meant that the Government were cutting the very counter-terrorist programmes to which they attach such importance in their public statements. That suggests that we have a Government-and, in particular, a Prime Minister-who are indifferent to the point of negligence towards the global interests of the United Kingdom.

I have three questions for the Minister. First, can he explain how the Government got themselves into this mess? We know that the problem started with the decision to end the overseas price mechanism and to transfer exchange rate risk from the Treasury to the Foreign Office. Did Ministers not understand what harm might be done to Britain's international interests as a consequence of that decision, and why did the present Foreign Secretary allow it to happen on his watch?

Secondly, what is the scale of the damage done so far? Can the Minister confirm the figure given to the Foreign Affairs Select Committee by his permanent
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secretary-namely, that the cost to the FCO in 2008-09 was £60 million, and Baroness Kinnock's statement yesterday that the shortfall has risen to £110 million in the current financial year and is set to rise further in 2010-11? Will the Minister also confirm that that figure adds up to about a quarter of the budget for the FCO's core activities, once the ring-fenced budgets for the British Council and the BBC World Service have been stripped out?

We know from the permanent secretary's evidence that, as a consequence of this, the FCO has now "stopped most training" and put some staff on involuntary unpaid leave or four-day weeks. We know from what Baroness Kinnock said yesterday that there have been reductions in conflict prevention work in Africa and in climate change programmes-again those to which Ministers have said publicly that they attach great importance. Is it not time for the Government to come clean about what they are doing and to make public a full list of the cuts they are imposing as a result of the debacle of their exchange rate policy?

Thirdly, what are Ministers' intentions for the future? I have seen an internal FCO memorandum from December last year that says

but instead by stopping activity, closing posts and reducing staff numbers. Officials have apparently been instructed to work up contingency plans for substantial cuts, which

As always, the difficult decisions are postponed.

The memorandum also states that this plan was discussed with the Foreign Secretary and his ministerial team on 21 December 2009. Did the Minister and his colleagues approve this strategy? In particular, how far has work now proceeded on a contingency list of British posts overseas that now face closure? How many of our embassies face the axe because of the Government's decisions on exchange rate risk, and when will Ministers finally come clean to the House and to the British people about what they are planning?

Chris Bryant: I shall respond first to the hon. Gentleman's questions about counter-terrorism, which I think is accepted by all Members as the overriding and single most important element of the work we have to do. The total amount of money we are spending on counter-terrorism is rising each year and the percentage of the amount we are spending on Pakistan has increased. Pakistan now receives 28 per cent. of the total amount of counter-terrorism spending; Afghanistan 13 per cent.; Saudi Arabia 7 per cent.; east Africa 7 per cent.; and Yemen 5 per cent. We believe that those are the appropriate priorities.

The total spend on Pakistan has therefore gone up from £3.7 million in 2007-08 to £6.2 million in 2008-09, £8.3 million in 2009-10 and we project it to be somewhere between £9 million and £9.5 million in 2010-11. I gently point out to the hon. Gentleman that we have been able to increase that funding because we have taken the right economic decisions for this country. I have never heard from any shadow Treasury Ministers that they would even protect the Foreign Office budget, let alone increase it as we have over the last few years.

The hon. Gentleman referred to the overseas pricing mechanism. We have been completely open about the existence of a problem here, and I think that the hon.
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Gentleman must have written his comments before he heard what I said. I said quite clearly that the Foreign Secretary had replied to the right hon. Member for Richmond, Yorks, to whom I presume the hon. Gentleman occasionally talks. My right hon. Friend wrote to the right hon. Gentleman in December last year, saying that "the estimated impact" was going to be more than £100 million in 2009-10. The hon. Gentleman is absolutely right to say that the permanent secretary at the Foreign Office spoke openly and clearly on this matter when questioned by the Foreign Affairs Committee. At no point has there been any element of trying to obfuscate or hide the situation we face from the House or the public. No final decisions have been made about next year's budget. There are ongoing discussions with the Treasury and I hope that they will be fruitful.

Finally, the hon. Gentleman asked whether there is a list of posts that are going to be closed, whether some embassies are not protected and whether some work is going to come to an end. No, we believe it is vital to maintain our presence in the world, with Britain, as a great nation, making a significant difference around the world. We also believe that the overseas aid budget is an important part of the work we do in Pakistan. We are the second largest donor in the world, and will give £665 million over the period from 2009 to 2013. The hon. Gentleman can huff and puff as much as he wants about this, but unless he is prepared to make commitments about the Conservative party's funding after a general election, I do not think that anybody will take him seriously.

Mr. Edward Davey (Kingston and Surbiton) (LD): How does the Minister square what he has told the House with what his ministerial colleague Baroness Kinnock said in the House of Lords yesterday? She said:

In the light of the figures that have been given, is it not the case that the budget for counter-terrorism and counter-radicalisation in Pakistan was much higher at the beginning of this financial year? Why did the Foreign Secretary not demand that the Chancellor and Prime Minister make good any funding gap to secure such important programmes?

What representations have the British Government received from the United States or other allies in Europe and beyond about the impact of such dramatic cuts on our diplomatic efforts with them? If beating terrorism is the Government's top priority, they are clearly too shambolic to be trusted with the task. The country is at war to make Britain safe from terrorists. To do that, every military, political and diplomatic sinew should be strained. Our troops are risking their lives. If we do not put in the investment to counter the terrorist threat in Pakistan, we betray their efforts.

Chris Bryant: The hon. Gentleman mischaracterises the situation. As I have made clear- [Interruption.] He can point to House of Lords H ansard as often as he wants, but it will not make any difference to the facts. As I have articulated already, total counter-terrorism spending on Pakistan was £3.7 million in 2007-08,
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£6.2 million in 2008-09, £8.3 million in 2009-10, and we project next year's spending to be between £9 million and £9.5 million.

The hon. Gentleman is right in one sense: of course we would like to be more ambitious, but we have had to curtail our ambitions in this field. On burden sharing in counter-terrorism, the work that we do in Afghanistan and the work that we have done in Iraq, the truth is that this country bears a substantial burden. We have received no representations or criticism from other countries in that regard.

I find it a bit difficult to accept the hon. Gentleman's comments about the protection of people in this country, because his party has systematically opposed every measure that we felt necessary in that respect.

Keith Vaz (Leicester, East) (Lab): As the Minister knows, Lord West, the counter-terrorism Minister, has said that the budget for the security services has increased to £3.5 billion, a 250 per cent. increase. What concerns me about Baroness Kinnock's comments is the possible impact on the joint visa operation between FCO and Home Office staff. Abdulmutallab was denied a visa to come to this country to attend a bogus college because of the good work of our entry clearance operation. Will the Minister assure the House that that will not be affected by suggestions concerning changes in the rate of exchange, as it is an important way of preventing from coming to this country people who should not be here?

Chris Bryant: My right hon. Friend is right to say that the Foreign Office budget, and the £2 billion under discussion, is not the only budget that affects our relations with different countries. The UK Border Agency budget and the overseas development funding to Pakistan are also significant. We want to ensure that such funds are protected for aid and development, and are not siphoned off, as other parties have suggested, to deal with security issues. The figure does not include the funding of the Secret Intelligence Service, which is protected.

Sir Patrick Cormack (South Staffordshire) (Con): Will the Minister calmly and clearly tell the House whether Baroness Kinnock's comments were accurate or not?

Chris Bryant: As I have said to the hon. Member for Aylesbury (Mr. Lidington), Baroness Kinnock was right that the amount of money that we have spent on counter-terrorism in Pakistan has increased and will increase next year. There is not a cut; we will not spend less next year. However, we will be spending less than we had an ambition to spend.

Mr. Denis MacShane (Rotherham) (Lab): Is this not an artificial hullaballoo? Obviously if the exchange rate goes down, things will cost more abroad-every one of our constituents finds that out after taking the Eurostar to Paris. During my eight years as parliamentary private secretary and a Minister, we were constantly closing and opening posts and reallocating budgets.

I was shocked to learn that the actual real spend of the Foreign Office, as announced today, is £830 million, less than 1 per cent. of Government income. I think we should be spending more. However, the Conservatives
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have an answer: if they win power, they will shut everything down by isolating us from Europe and the rest of the world.

Chris Bryant: My right hon. Friend is right. Ultimately, overall spending on our Foreign Office budget and, for that matter, all the budgets that affect our relations with other countries-including the budget of the Department for International Development-is a question for the whole of Government; and given the Conservatives' deliberate intention to cut budgets now, I do not think they have a leg to stand on.

Mr. Tobias Ellwood (Bournemouth, East) (Con): The Minister has now acknowledged that we are going to spend less than was intended. Let me remind him what the Prime Minister said yesterday:

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