Examination of Witness (Questions 1-131)|
RT HON DAVID CAMERON MP
18 NOVEMBER 2010
Q1 Chair: Welcome, Prime Minister.
It is your first appearance before the Liaison Committee, the
Chairs of the House's Committees which scrutinise Departments,
oversee the effectiveness of Government and manage the House itself.
The purpose of these sessionsI reiterate this not for your
benefit, as you know very well, but for othersis quite
different from Wednesday's Question Time.
Mr Cameron: That's a relief.
Q2 Chair: They are not for
political jousting between leaders. They are not for quick exchanges
on constituency or national grievance points, but they are designed
to explore in greater depth and hold to account the role that
you play and your office at No. 10 plays in the determination
and delivery of Government policy. We are looking at a number
of areas where we think your own input has been decisive or significant.
We scrutinise our individual Departments in our own Committees
and we call Ministers before us, so now it's your turn.
We will start with a major section on the comprehensive
spending review. The Chief Secretary has already been questioned
in detail by the Treasury Committee, and other Ministers by other
Committees, but what about your role? How often were you involved
simply in order to broker agreement or referee arguments between
the Treasury and Departments? How often was that the reason for
Mr Cameron: Well, I was involved
from the start setting the strategy for the comprehensive spending
review. Obviously that went back before the Budget, and involved
setting the overall fiscal mandate for the Government: how much
we were trying to get debt down and by when. When it came to the
comprehensive spending review itself, I was involved both in setting
the strategywhich Departments would we try to protect,
what areas would we to try to invest in, what was the thinking
behind where to make cuts and how to make themand then
I was involved in two other ways. One was through what became
known as the Quad. We had a quadrilateral meeting of the Deputy
Prime Minister, me, the Chancellor and the Chief Secretary, which
I think occurred nine times, and we would use those meetings to
go through some of the difficult areas and try to work out what
the right policies and approach were. So setting the strategy;
running the Quad meetings, which I think were very successful
in making it a collective decision; obviously chairing Cabinet,
and Cabinet had about nine discussions on the spending review;
and then, yes, I was involved in helping to settle some of the
individual Departments, particularly some of the tricky, difficult
issues. There are some really difficult issues involved. Defence
was one, but some other Departments were involved too. It was
a mixture of things but, I hope, it was mostly strategic and trying
to make sure the process was more collegiate and collective than
it has been in the past.
Q3 Chair: But the cases where
there was a dispute were not necessarily the ones in which you
had the greatest interest in steering the policy in a particular
direction. So how often were you intervening in this process because
you had a particularly strong view about what the policy should
Mr Cameron: It wasn't so much
that. There were disputes, obviously, between the Treasury and
the individual Departments. I didn't get involved in all of those.
I would get involved if they weren't being resolved and so there
were one or two areas where they weren't being resolved and I
got involved in order to help resolve them. Given the scale of
the public spending reductions we are trying to achieve, the process
worked very well partly, I think, because the Treasury did a good
job at meeting early on with Cabinet colleagues. Also in this
Quad process, where we went through difficult areas like how we
were going to try to protect education and early years, what were
we going to do about housing, how were going to make sense of
welfare, we had proper, substantial meetings between both Conservative
and Liberal Democrat colleagues in the coalition to talk through
One other point: I think the reason why it went
relatively smoothly is that we took a big decision at the beginning,
which I think is inevitable if you are trying to reduce public
spending and get a deficit under control, that you've got to look
at the very big areas of public spending like pay, pensions and
welfare. If you do not do that you are going to make unacceptable
cuts in schools, hospitals and policing. We did, I think, make
some quite big decisions on welfareI think £18 billion,
if you put the Budget and the spending round together, of reductions.
As you know, we have frozen public sector pay for two years. In
public sector pensions, there will be increased contributions.
So those three big areas and big decisions made the rest of the
spending review not easyit was extremely difficult because
of the reductions we were looking forbut it set the framework.
Q4 Chair: It made it more
difficult, didn't it, in some areas?
Mr Cameron: No, because, as I
say, if you don't do things on welfare, pay and pensions, you
would have to be cutting, by far more, education and other areas.
I thought that that was unacceptable. If you want to get the
Budget deficit under control, you have got to look at the big
areas of public spending, as I've said, rather than just think
you can just have cuts across the board in every Department. That
would have been very unstrategic. We took a strategic view that
we wanted to protect various Departments: the health service,
overseas aid and, effectively, the schools budget. We took a view
that we wanted to protect capital spending, because we wanted
to invest in the recovery, and we protected capital spending.
We wanted to make sure that, while we were making spending reductions,
there was a strong element of fairness, and particularly social
mobility. So, in the decision, for instance, to increase nursery
education for two, three and four-year-olds, to introduce a pupil
premium to help young people from low-income backgrounds go to
university, I would say that there is a strong strain of social
mobility helping to create a more fair society that also goes
right through the spending round decisions. We took those decisions
early on. So those were the aims, and the spending decisions had
to flow from those aims, rather than just trying to make the numbers
Q5 Chair: Did those issues
about early years education and the pupil premium require late
intervention from you and the Deputy Prime Minister?
Mr Cameron: They were decided
at the Quad meetings, so the Deputy Prime Minister, myself, the
Chancellor and the Chief Secretary, and sometimes other Ministers
as wellwhen we were discussing welfare, Iain Duncan Smith
was there. That is where we decided the strategy for, as I say,
which Departments to protect, the strain of fairness that we wanted
to run through the spending round, and the decision to support
the recovery by not seeking further reductions in capital spending.
Indeed, we have actually increased capital spending from the plans
that we inherited.
Q6 Mr Tyrie: This spending
review is described as comprehensive, but it wasn't really, was
it? There were quite a number of areas which had already been
hived off as untouchable at the start.
Mr Cameron: That's right. I mean,
in the Conservative manifesto we said we wanted to protect the
NHS and we ensured that, in our negotiation with the Liberal Democrats
that went into the coalition agreement, the NHS would be protected.
I know that is a contentious decision that some people do not
agree with. I think it is right on two grounds. One is that the
cost pressures in the health service are huge anywaydrugs
budget, ageing population, new treatments coming on streamso
I think it is difficult enough to have a NHS budget that is just
increasing with inflation. Secondly, and I make no bones about
this, if you are trying to get from the biggest budget deficit
in the G20 to a position where you are balancing the books, you
have got to try and take the country with you. The thing I care
about most, and I think most people in this country care about
most, is our national health service; that it is there for us
if we get sick. So I think it is right, morally, as you are asking
the country to come together and go through a difficult time to
get to a better future, to protect the one thing that we all care
about very deeply.
Q7 Mr Tyrie: Still, you are
agreeing, it wasn't a comprehensive review; it was a semi-comprehensive
review at best, and you bought off various pieces of opposition
to take, as you put it, the country with you by excluding a number
Mr Cameron: I think it was a comprehensive
review in that we took decisions right across every single Department.
We took a decision about the health service. There will have to
be efficiencies in the health service. There is a big programme
to reduce bureaucracy in the health service. That was part of
a comprehensive set of decisions.
Q8 Mr Tyrie: You'll understand
that Ireland is very high in the news at the moment. I passed
warning to your office that I might ask about Ireland. Do you
want, now, to quash the widespread reports that, on a contingency
basis, plans are afoot for a bilateral bail-out?
Mr Cameron: First, I don't think
it would be right to speculate about the financial health of another
country in the European Union, a country that is a close neighbour,
a good friend, and a country that we have very close political
and economic relations with. Obviously, if you look at the relationship
between Britain and Ireland, it is one of our biggest export markets.
As I said in the House the other day, we export more to Ireland
than we do to Brazil, Russia, India and China combined. Perhaps
that's not a great reflection of how well we're doing in the rest
of the world, but those, nonetheless, are the facts. Our banks
are very connected to the Irish banks. We have an interest not
only in the eurozone being a success, but in Ireland being a success,
so I certainly don't want to rule things out, but, as I say, I
don't think we should be speculating.
Q9 Mr Tyrie: So there would
be special conditionsa special relationship that we have
with Irelandthat might lead one to want to do a bilateral
bail-out rather than use the purely European mechanism?
Mr Cameron: Well, let me make
one point about the European mechanism, so that everybody understands,
because I think it is important. The previous Government, before
the new Government came to office, agreed in the European Union
this European financial mechanism which is basically there to
help countries that get in trouble. It is established under qualified
majority voting. It was supported by the previous Government;
it was not something that we advised. That is a mechanism that
is there and can pay out money to support countries that are in
trouble. That exists, and we are part of it whether we like it
Q10 Mr Tyrie: Perhaps I could
just ask one general question with respect to all this. Have you,
in your planningI presume there is planningtaken
on board the fact that a bilateral bail-out will come out of the
bottom line? It will therefore increase the deficit and also therefore
alter the numbers in the CSR, unlike the contingency liabilities
created by a European bail-out.
Mr Cameron: We're not speculating.
If I may just give a technical answer, let me say that the point
you make is absolutely right. Money lent to other countries via
the mechanism is a contingent liability. They just use the headroom
between the European budgetwhat the European Union spendsand
what it is able to spend. They use that headroom to make a contingent
loan. That is not actually money that you have to go out and raise,
whereas a bilateral loan is money that you go out and raise in
order to lend. Technically, you are making a
Q11 Mr Tyrie: And you have
to come to the House for approval on a supplementary estimate.
Mr Cameron: I think, in any event,
if these things were to happen, one would want to have an early
discussion in the House of Commons.
Q12 Mr Tyrie: And one can
take it from your answers that you are heavily engaged in these
debates and issues.
Mr Cameron: I think I've tried
to answer the question as best I can.
Chair: Mr Cash has a supplementary about
Q13 Mr Cash: Yes. Prime Minister,
given that article 3 of the mechanism that you have referred to
can only be activated, under the European regulation that governs
this, by Ireland itself and not by qualified majority vote. Given
that Ireland has not activated that, are the Chancellor and the
coalition Government joining Germany and the other member states
to participate in this mechanism before it is activated? Why are
the European Bank and the Commission in Dublin before the regulation
is activated? Doesn't it look rather as if we are trying to coerce
Ireland against the views, expressed by their Prime Minister,
that they can manage for the time being? Why are we taking part
in this mechanism and not doing a bilateral arrangement, which
will enable us to be able to do it outside the European framework?
Mr Cameron: First of all, I'd
say that we're certainly not trying to coerce Ireland to do anything.
That is not any part of our plans. I think the technical position,
as you put it, is absolutely right. I don't really want to go
into any conversations in Europe that are taking place and all
the rest of it. I think that counts as speculation. But I think
the position, as you and I understand it, is that this mechanism
exists, it is operated by QMV, Britain is a part of it, because
of the action of the previous Government, it has funds available,
because of the way it was set up, and that is the situation that
Q14 Mr Cash: But the QMV only
operates once you've got into the system. It has to be activated
by Ireland, and they've said they don't want to get into this
at this stage.
Mr Cameron: I can't answer for
the Irish Government, obviously.
Q15 Chair: At the moment,
we take it that both options are still open. Although, of course,
neither might be pursuedthat is to say, the European mechanism
and the bilateral mechanism.
Mr Cameron: I think you'd be right
in saying that, but as I say, I think going any further would
be speculating into the fate of another country, and I don't think
we should do that.
Q16 Margaret Hodge: I want
to get us back to the breadth of the comprehensive spending review.
You have saidI think there is consensus on this throughout
Parliamentthat we should do all we can to find value-for-money
back-office savings to protect front-line service. My Committee
undertook a study of the value-for-money savings that were sought
in the last comprehensive spending review, and I think that, despite
its being a political imperative, the machinery of governmentthe
Departmentsfailed to deliver. Only 40% of savings were
found, and only a third of those were genuine value-for-money
savings as opposed to cuts. I wish you the best in your attempt
to succeed in this endeavour to find genuine value-for-money savings,
but were you to fail, would you then find other cuts or would
you lower the £81 billion target?
Mr Cameron: You put the question
very fairly. I think that one of the reasons why, in the past,
some of the value-for-money savings haven't been found is that
there wasn't quite the same need to find them. Departments were
often faced with rising baselines and told, "Go ahead and
save some more money if you can, to spend even more," and
those savings weren't found. We are in a different situation,
because Departments really can see that, in some cases, their
baselines are being reduced. So they are going to have to work,
with the help of the Cabinet Office and others, to really make
sure that they look at back-office costs and central administration
first. They are being helped by a Government who are freezing
public sector pay, reducing welfare payments and dealing with
the issue of public sector pensionstwo of which benefit
Departments at the same time. We are not planning for failure
in finding these savings, but the savings we have set out across
the four years need to be achieved and we want to achieve the
maximum amount of them through the sorts of efficiencies that
you talk about.
Q17 Margaret Hodge: And if
you don't? That was really the question. Gus O'Donnell gave us
evidence yesterday, so I can see that there is real endeavour,
ironically, to centralise control rather strongly in the Cabinet
Office to ensure that the savings are secured. But I have to say
that I am sceptical as to whether you will achieve what you have
set out to do. What I am interested in is: were that to happen,
would you then come back for further cuts, or would you reconsider
your £81 billion target?
Mr Cameron: The baseline of reductions
is set out and we want to stick to that.
Margaret Hodge: So you would have to
come back for further cuts?
Mr Cameron: No, the Departments
have to deliver those reductions. They are being helped, as I
say, because we are freezing public sector pay, improving procurement
and reducing back-office costs. We are doing things to help them,
but in the end those Departments have to deliver those reductions.
Take the example of policing, which we discussed
yesterday in the Chamber. HMIC Her Majesty's inspectorate
of constabularysays that it is quite possible to get 12%
reductions in police spending without reducing the number of officers
on the beat. How do you make up the gap between that and the reduction
in Home Office spending that we are talking about? Well, obviously
we are adding a two-year pay freeze
Chair: We will come to that later.
Mr Cameron: I know, but I am just
using it as an example. We are making changes to police pay and
conditions, and we are changing paperwork, which will go in addition
to what HMIC is saying. In the end, the Departments have to deliver
this. It is worth rewinding and asking why we are doing this and
trying to do so much within a Parliament. The fact is that if
we weren't doing this and if we took the plans we inherited, at
the end of the Parliament we would still have a structural deficit
of 3% and we would still be adding to our debt-GDP ratio. In simple
terms, it would still be getting worse. So after all the pain
of cuts, the situation would still be getting worse. That would
not be a sensible way to go about it. We have to get to a situation
where, within this Parliament, we will have effectively dealt
with most of the worst part of the programme.
Q18 Margaret Hodge: I hear
that. I am sceptical as to whether the Departments will find it
without tackling front-line services, but I hear your intent.
May I give you three examples from the work we have done to date
of where I think it is either a short-term decision that can have
a longer term impact, or an unintended consequence of a decision?
HMIC is the first of my three examples. It is facing a cut in
staff and has 18 million accounts, going back to between 2004-05
and 2007-08, unreconciled as to whether people have paid too much
or too little in tax. HMRC told us last Friday that it is writing
off three of those four years in terms of money owed to Government.
We are therefore writing off about £650 million. With its
lack of staff HMRC is unlikely to be able to tackle '07-'08 properly,
and the total amount owed to Government is £1.4 billion.
Your unintended consequence there is cutting staff then losing
money, which leads to further cuts elsewhere.
Mr Cameron: I'll ask the Treasury
to look specifically at that issue, but in the spending review
we actually announced, "Yes, there are some efficiencies
that are being driven through HMRC, as there are in other Departments,"
but we announced a specific extra bit of investment into a part
Q19 Margaret Hodge: Can I
stop you there?
Mr Cameron: Hang on a second;
let me just finishin order to raise an additional amount
Q20 Margaret Hodge: Apologies
for saying this to you, but we have been told by HMRC that that
is a separate, additional amount for a separate £7 billion.
Mr Cameron: That is exactly
the point I made. It is separate.
Q21 Margaret Hodge: And HMRC
still has to lose the staff who would be collecting the £1.4
billion owed to us.
Mr Cameron: We can't exempt Departments
from trying to be more efficient. As I have said, there was a
separate decision made in HMRC to try and recover £7 billion,
I think, of revenue; I can confirm that figure to you if you like.
Q22 Margaret Hodge: Let me
take another example, which is the decision to delay Trident.
I can understand the political reasons for delaying it, but the
reality is that we will have to spend £1.2 billion to £1.4
billion extra on extending the life of the Vanguard submarines,
and we will have to spend an extra £1 billion on an extra
order for a hunter-killer submarine to keep the Barrow shipbuilding
capacity going. Is that sensible?
Mr Cameron: I don't agree with
you about the second part. The hunter-killer submarinethe
seventh Astute submarinewas part of the defence programme.
You are shaking your head, but it was, and we think it should
be, part of the programme. I would separate that decision, which
I think is the right decision and which we took in the strategic
defence review, from the decision we have taken over Trident.
I asked very specifically, "Can we look
very closely at the costs of the Trident replacement, and see
how much it is necessary to spend both now and in the future?
Now that we have all the experience of the current Vanguard submarines
operating, can we make a better estimate of how long their life
is?" The advice that came back very clearly from officials,
which we accepted, was that you could make the decision a little
bit later; that you could put off some of the spending from this
Parliament; that overall that would not add to the costs; and
that it was the right decision to take. I know that we are going
to come on to the strategic defence review; that was part of a
very thorough piece of work.
Q23 Margaret Hodge: Well,
I have to say to you that we don't yet know what it will mean
in terms of additional costs of Trident if we go ahead, and we
know the additional cost in extending the life of the Vanguard
submarines. From the Committee's point of view of value for money,
it looks like a short-term decision with a long-term extra expenditure
Mr Cameron: I believe it is a
reduction of £750 million over the spending review period
and some £3 billion over the next 10 years, but I am sure
that a Defence Minister or a Treasury Minister would be happy
to come in front of your Committee and go through it in detail.
As I have said, we were doing a defence review,
and I think it was important that we looked at the costs of Trident
in that review. We have managed to save more than £700 million
in the spending review period. We are still spending significantly
on Trident's replacement during this period. I was assured that
we could do this having no gap of capability between the existing
and new submarines, and I was told it was possible to do so without
suspending continuous at-sea deterrence. It seemed to me, therefore,
if you could save some money it was a perfectly sensible thing
Chair: As we have moved into defence,
I would like to bring in James Arbuthnot at this point.
Q24 Mr Arbuthnot: Prime Minister,
what role did you play in the strategic defence review?
Mr Cameron: Again, a chairmanship
role, I would say. I chair the National Security Council. That
is a new Committee; it is the leading Cabinet Committee that we
have established, which I think works extremely well. It has met
about 18 times since the Government were formed. Seven of those
meetings specifically covered the strategic defence review. I
chaired those meetings, in order to first set the strategy that
we wanted to follow as a country: "What are the biggest threats
and opportunities to us?" and flowing from that strategy,
"What is the defence posture that we ought to take?"
and then, flowing from that, "What are the decisions we ought
to take about submarines, destroyers and frigates and all the
rest of it?"
In addition to that chairmanship role, obviously
the service chiefs have a direct line to the Prime Minister and
they like to come and make their views known, which they did.
We had very good exchanges and conversations. I had a number of
bilateral meetings with the Defence Secretary and the Chancellor,
and I played quite a role at the end. There was a gap between
the Treasury and the Ministry of Defence, which was quite widely
reported on, so I don't think I'm breaking any great confidences,
and I helped to bring together both parties at the end to get
what I think was a good, sensible outcome. It was mostly a strategic,
chairman-like role, I hope, but with a bit of interference at
Q25 Mr Arbuthnot: So, was
it the most difficult area of the whole of the comprehensive spending
Mr Cameron: Yes, I think it was,
for a couple of reasons. The first is that it was one of the most
overspent Departments. It was a bit of a train crash when we took
over, in terms of £30 billion of excessive commitments and
overspends. Plus, it is fantastically important
Q26 Mr Arbuthnot: Is that
a change from the £38 billion?
Mr Cameron: Sorry, it was £38
billion, you're right£38 billion of overspends. Plus,
it is a fantastically important area, which we have to get right.
And, defence was part of an overall strategic security and defence
review that included other areas as well, which made it particularly
complicated. Within it, there were one or two areas, such as the
decision over the aircraft carriers, which was a fantastically
difficult question to try and get the right answer to. I profoundly
believe that we got the right answers, but it took a lot of time
and work, and it was tough.
Q27 Mr Arbuthnot: You said
that you particularly got involved right at the end. At that stage,
we had the letter from the Secretary of State for Defence to you,
which somehow found its way to The Daily Telegraph. What
effect did that letter have on the entire process?
Mr Cameron: I don't think it had
a huge impact. You know as well as I do that Ministers stand up
for their Departments and make the case for them. Sometimes they
do it orally and sometimes it appears in a letter; regrettably,
sometimes it appears in the newspapers. There is a problemthat
Department does seem to have had a bit of a problem with leaks,
which is worrying when it is the Department responsible for security.
However, I don't think it made a huge difference.
The fact is that I think it was a good outcome,
in terms of saying, "Here we are as a country with this vast
deficit. We have to deal with it." Defence made a modest
contribution with an 8% real-terms reduction over a four-year
period, and that doesn't touch at all what we are doing in Afghanistan,
because that's funded out of the reserve. A set of good and long-term
decisions were made over things such as carriers, Army numbers
and future requirements for the Air Force, which I think are right.
We can come on to that.
Q28 Mr Arbuthnot: Sticking
with that letter just for a moment, it would not have been so
influential if it had just been between him and you, would it?
If it hadn't been leaked, it would surely not have had nearly
so big an effect.
Mr Cameron: I think the point
is that because it was the most difficult area to deal with, there
were always going to be more discussions about defence and a trickier
process of getting it right than perhaps with other Departments.
Leaked letters don't help. I'm not trying to be evasive. They
don't helpof course they don't; they add to the public
pressures. They mean the meetings that you are having are under
huge external scrutiny, and everyone wants to know what happened
after this National Security Council or that National Security
Council, whereas in a normal week, you can have a meeting and
no one is in the slightest bit interested. So of course, it adds
to the pressure, but I don't think it materially changed what
was a genuinely collective discussion, and I don't want to underestimate
When we talked about the defence needs of the
United Kingdom, for the first time in a long time in the National
Security Council, there was the Business Department, the Chancellor
of the Exchequer, Development, Defence, the Prime Minister and
the Foreign Secretary, who were having a proper discussion about
what the right defence posture was for the UK, and where we needed
to spend our money in order to deliver it. That is very helpful.
Throughout this whole spending review process, I've tried to make
it more collective and collegiate, and more about the Government
coming together and discussing such things as a Government, rather
than bilaterally between the Chancellor and a Secretary of State,
or between just the Prime Minister and the Chancellor sitting
on the sofa. We tried to have more of a collective discussion
about those things.
Q29 Mr Arbuthnot: I'll come
on to that precise process in just a moment. There is one question
that concerns mewell, there are several questions that
concern mewhich is that of the uplift for the defence budget
from 2015 onwards. You said on the day of the strategic defence
and security review, "My own strong view is that this structure
will require year-on-year real-terms growth in the defence budget
in the years beyond 2015." So that is your own strong view,
and it is clearly the Defence Secretary's own strong view, but,
rather oddly, it seems not to be Government policy. What do you
intend to do to turn your own strong view into Government policy?
Mr Cameron: I suppose that the
short answer to that is: put it in a manifesto and win an election.
Q30 Mr Arbuthnot: That won't
work, will it? If that view is not Government policy, the Ministry
of Defence will have to start making really severe cuts with effect
from 2012 onwards.
Mr Cameron: I don't accept that.
I think the point is that the Ministry of Defence now has what
it hasn't had for a long time. It has its budget numbers out until
2015, and it knows that one party has absolutely committed to
real-terms increasesI haven't specified how muchbetween
2015 and 2020. I think that that is necessary to deliver the sort
of force levels and effect that we've talked about for 2020. It
is obviously for other parties to make their views clear, but,
frankly, I think that that is a greater planning horizon than
the MOD has had for a long time. If you think of the MOD, two
years ago, three years ago, it was massively overspent£38
billion in the redwithout a clue of what was going to happen
next. I think it has a much better position now, with a departmental
budget that is basically a flat £34 billion, give or take
a bit, through five years. What we have to do is make sure that
we have good people in the Ministry of Defence making sure that
we get value for money. I am enthusiastic that we've got a new
Permanent Secretary, a new Chief of the Defence Staffwe
need to get a new Chief of Defence Materiéland good
people in the Department to make sure that it delivers on the
very large amount of taxpayers' money that is going into it.
Q31 Mr Arbuthnot: Okay, but
in the defence review you also announced a 10-year rolling budget
for the Ministry of Defence. Presumably, you'll be building into
a comprehensive spending review before the next election the sort
of uplift that you are saying it is your strong view should be
Mr Cameron: That's a very good
question, and there are two answers to that. One is that we think
we should have a defence review every four or five years, which
will help that process. Secondly, yes, of course there will be
a debate within Government about what more we can say on defence
spending, which will be discussed and debated every year between
now and 2015. We are in a coalition, and I think we've come to
a very good outcome on a defence review. We have shown that, actually,
two parties that have slightly different track records and different
policies on this matter can come together and make sense of a
really difficult set of questions, and I am sure we can continue
Q32 Mr Jenkin: It is widely
understood that the decision to withdraw the Harrier and Ark Royal
under the SDSR was a
last-minute decision made over the weekend before the review,
and, until then, they were to stay. That decision was very roundly
attacked by the former First Sea Lord, Admiral Lord West. That
provoked a reaction from the chiefs of staff, which was published
as a letter in The Times. Did No. 10 have any role in suggesting
or promoting the idea of that letter and in encouraging them to
try to close down the debate?
Mr Cameron: I've read both letters,
and I am delighted that the chiefs of staff wrote such a powerful
letter in defence of the decision we made, but I don't know all
of the details of how that letter came into being.
Q33 Mr Jenkin: Did No. 10
have any role in it?
Mr Cameron: I simply don't know.
I wouldn't be at all surprised, but I don't know.
Q34 Mr Jenkin: So it might
have been a suggestion from No. 10?
Mr Cameron: I cannot answer the
question, because I don't know. I am very happy to write to you.
I would much rather deal with the substance of the issue, which
I think is genuinely difficult and fascinating. Who wrote what
letter is, frankly, less important. The reason the decision was
made relatively late was that it was the most difficult question
at the heart of the defence review, which we debated and discussed
as a National Security Council over and over again.
I shall explain how my view changed, to give
a sense of how deeply the matter was discussed. Coming at it as
an amateur, it seemed at first cut that the obvious answer was
to keep the existing carriers, and also to keep the Harrier, which
could be used as a bridge to the new carriers. That is the simple,
amateur, straightforward view: there is no capability gap, so
the Tornado is retired instead of the Harrier. However, by the
end of the process, I was convinced that although that decision
was the easiest to explain in Parliament, and to the media and
the public, it was the wrong decision. I profoundly believe that
we have now made the right decision, which is to keep the Tornado
and retire the Harrier, except in respect of a capability gap
between having a carrier now and having one in future. I take
that view for the following reasons. First, Tornado is a more
capable aircraft than Harrier. The Harrier has a fantastic record.
I grew up full of admiration for what that aircraft did in the
Falklands, but the fact is that, today, the Tornado is a more
effective ground attack aircraft. It is operating now in Afghanistan.
Secondly, the big question for us right now is: how can we best
support our troops and our effort in Afghanistan? That is by
keeping the Tornado.
Chair: I think that most of us are familiar
with that argument.
Mr Cameron: That is why we came
to the more difficult, complicated and nuanced viewbut
the right view. I wanted to try to explain that to the Committee,
in a way to try to prove that this was a discussion and debate
process, rather than saying, "Let's do what is easy or politically
convenient." It would have been much easier to keep Ark
Royal, keep the Harriers, retire the Tornadoes and say, "There
we are, what a simple answer to the question." It would
have been the wrong answer. That is why I feel so strongly.
Q35 Mr Tyrie: Many of us will
find it unacceptable if it turns out that No. 10 did prompt chiefs
of staff to enter political controversy in that way. It is very
important that we get to the bottom of that, and we await your
When Lord Turnbull gave evidence to the Treasury
Committee, he said that Liam Fox's letter was written to be leaked.
I am sure you did not see it that way, Prime Minister.
Mr Cameron: No, it was a letter
written to put the Secretary of State's view about the importance
of not making excessively deep cuts in defence. Over four years,
7.51% real-terms reductions are a lot lower than reductions in
other Departments. Let us look at the effect that we are getting
for that money, whether in the Royal Navy, the Army or the Air
Force. We still have the fourth biggest defence budget in the
world. We can overdo the gloom. We are going to have the best
hunter-killer submarines anyone has got in the world. We are going
to have a brand-new aircraft carrier.
Chair: Prime Minister, I know there are
messages you want to deliver to us, but there are a lot of things
we want to ask you about.
Mr Cameron: Sorry, I do not want
to get carried away.
Q36 Mr Tyrie: On the carrier
decision, how thoroughly did you personally explore the scope
for renegotiation of that contract.
Mr Cameron: Fairly thoroughly.
Q37 Mr Tyrie: This is a monopoly
supplier, and a monopoly purchaser. That normally creates some
basis for negotiation, does it not?
Mr Cameron: Absolutely. This
was a question I asked repeatedly: "Can we go back to BAE,
can we look at the contracts, can we see whether we can change
the contracts?" But the answer was pretty clear. This is
something that a Select Committee might want to look into. These
contracts were pretty tightly drawn, and if we had even cancelled
the second of the two carriers it would have cost a huge sum of
Q38 Mr Tyrie: In order to
look into the matter, a Select Committee will need the contract.
I recognise that some aspects of the contract will be security
confidential, but would you agree to provide that contract to
my Select Committee with the security aspects redacted to enable
us to examine the extent and limits of the scope for negotiation?
Mr Cameron: I will be happy to
provide the maximum that we can under the rules, but it was an
Mr Tyrie: You make the rules, Prime Minister.
Mr Cameron: I wish it was as simple
as that. You find out in this job that you don't make quite as
many rules as you would like, but I will certainly look into it
and we will do what we can.
Q39 Mr Bailey: You and your
party have said that you are committed to widening participation
in higher education. A recent study by the Institute for Fiscal
Studies reported that education maintenance allowances have "significantly
raised" stay-on rates for post-16 students from lower-income
backgrounds and, indeed, the educational success arising actually
pays for itself. If the Government were committed to this in the
run-up to the general election, why is it now being removed and
what steps are being taken to replace it?
Mr Cameron: We've had to look
at every area of spending very closely because of the catastrophic
state of the public finances that we inherited: an 11% budget
deficit, the biggest in the G20, a situation that put us into
the economic danger zone which we had to come out of. We looked
at the education maintenance allowance specifically and while
there is the piece of research that you quote, there is another
piece of quite well-thought-through research that shows that 90%
of the money is effectively dead-weight cost, paid to people who
would stay on anyway. It seems to me that there are two points
to make. First, we are going to be legislating to raise the effective
participation age in education to 18 so does it really make sense
to pay people to stay on at the same time as doing that? Secondly,
as part of a process of trying to drive trust and decision making
down to the lowest levels in this country, we will be enhancing
the amount of money and resources that college and school heads
have to try to target that sort of money on people who need it
most. That is, frankly, a better approach than the one that we
inherited. But I accept that there will be a spending reduction
in this area.
Q40 Mr Bailey: When do you
expect your proposals to come on stream?
Mr Cameron: We are looking at
this at the moment. I think an announcement will be forthcoming.
I don't have the exact date for when this will be introduced.
Q41 Mr Bailey: There is a
considerable gap between the implementation of the cuts and the
implementation of these proposals which seek to address the issues.
What is going to happen in the meantime?
Mr Cameron: I don't think there
should be a gap. There will be a phasing out of EMAs and then
the introduction of the discretionary learner fund. That should,
we hope, be quite a smooth process because, as I say, we are moving
to a situation where we will legislate to raise the participation
age to 18. We have to make big decisions about how to focus the
money on education. The big decision we have made is to put the
money into the schools budget. That's why the spending per pupil
is being frozen in cash terms across the Parliament and we are
introducing a £2.5 billion pupil premium over and above that
so that pupils from the poorest backgrounds have more money following
them to whichever school they choose to go to, which is going
to hardwire some real progressive thinking into our education
system. At the same time we are getting rid of a lot of specific
grants, trusting the head teachers with the maximum amount of
money we can for them to choose how they best spend it. That is
a different approach from that of the last Government, who had
a lot of different budgets for education, which made it very complicated,
and we think it is right to trust head teachers more.
Q42 Mr Bailey: Will you have a mechanism
for funding FE colleges?
Mr Cameron: Yes, we will. Again,
we are looking for a more decentralised, less bureaucratic mechanism
than what we have inherited. I don't know what you have found
but always when I have gone round FE colleges, they have complained
about the massive duplication of the number of bodies that they
have to go to for funding and they would like a simpler system.
A bit like a HEFC for
universities, they are going to have an FEFC, a further education
funding council, which will be much simpler than the myriad bodies
we have inherited.
Q43 Mr Bailey: Can I go on
to the implications of the rise in tuition fees because as a result
of these proposals, somebody going through university could potentially
accumulate up to £40,000 of debt on tuition and accommodation?
Given that it is much harder to sell the benefits of a university
education to students from low-income and low-aspiration families,
it will be a huge challenge to keep the level of applications
up. Indeed, the latest statistics show that after a rise up to
about 2008, it has been dropping in comparison with the private
sector. That puts additional responsibilities on organisations
like Aim Higher. Are you going to keep it and if not, what are
you going to replace it with? Aim Higher has been very successful
in this area.
Mr Cameron: I can't give you specifics
on Aim Higher, but I think the most important thing is that the
new system we are introducing is a more progressive system, because
students won't pay anything up front and no one will start paying
back until they earn £21,000 compared with £15,000 now.
I think it will be possible to encourage people from low-income
backgrounds to go to university with that sort of system. It comes
out of the Browne review, which was an all-party review commissioned
by the Labour Government, but with Conservative support, and it
gives a boost to the maintenance arrangements. That combination
of better maintenance arrangements, nobody paying anything up
front and not paying anything back until you earn £21,000
makes it a much more progressive system.
I totally accept that we still have a challenge
to get out to schools in deprived areas and encourage people to
apply to university. We will never get more social mobility unless
we do that. But looking at the policies we are adopting as a wholehelp
at nursery school, the pupil premium, and children on free school
meals getting some free time at universityall of those
things can help us as a Government and as a country to encourage
people from low-income backgrounds to apply to university.
Chair: Much as I would like to explore
these issues, I have to bring in Mr Miller.
Q44 Andrew Miller: I want
to move on to the science budget as a whole. I am on record praising
the work that David Willetts has done in maintaining flat cash
for the research councils' budgets. You said in earlier responses
that you tried to have collective discussions. I've been probing
an area that I can't get a straight answer on. Perhaps you will
give it to me, Prime Minister. There is an interaction between
the Browne report, the science settlement, departmental science
budgets, the immigration cap and the closure of the RDAs
on the effect on our overall capacity for science in the UK. What
advice were you given on the interaction of those things?
Mr Cameron: Crikey, if two-brains
Willetts can't answer that question, I don't know what hope there
is for me, but let me try. First of all, the flat cash settlement
for science gives a good baseline for science in our country.
There is an interaction between what's happening at university
and, as you say, the immigration rules as well. I would argue
that they are all heading in a pro-science direction. On the university
changes, HEFCE will
focus support on science degrees. I think that this system of
graduate contributions is going to focus the mind of the undergraduate
much more on, "What is a good course? What is a good university?
What will give me a good start in life?" I think all of that
is very pro-science.
On immigration, we are looking at overhauling
the system we inherited and, yes, having the tighter control of
immigration that this country badly needs200,000 net immigration
each year is too high and needs to come down. Within that, we
should have proper regard for people who can come to this country
and make a real contribution. Right now, the system doesn't really
work like that. As I tried to say in the House yesterday, people
are coming in under so-called tier 1 rules and are doing unskilled
Chair: Prime Minister, never feel it
is necessary to repeat what you said in the House yesterday.
Mr Cameron: Sorry, you are quite
right. Quoting your own speech is the first sign of madness; I
will stop it at once.
Q45 Chair: Perhaps you could
tell us, if I might interrupt for a moment, when you expect the
criteria to be known.
Mr Cameron: On the immigration
system, we are getting through this very effectively. I would
hope that, next week, we might be able to make enough progress
to make an announcement.
Q46 Andrew Miller: All of
your answer was predicated on "I think," so I am correct
in saying that you didn't receive any advice on the collective
impact of all of those issues, one upon another. That might need
some thinking about. We haven't got a strategy that engages us
on issues like whether we are going to attract people to come
in and be our successful Nobel prize winners. How many university
departments are going to close as a result of this policy? You
don't know the answer to that, do you?
Mr Cameron: I specifically asked
to see the chief scientific adviser when I became Prime Minister
and had a proper meeting with him about the big items on his agenda
to make sure that this was a pro-science Government. I have appointed
as our Science Minister someone whom you said you supportDavid
Willetts is one of the brightest talents in the House of Commons.
I think this is a pro-science Government. Of course, lots of different
policies will have an impact on science and I think, as I hope
to demonstrate, that they will have a good effect. That is why
we have a chief scientific adviser.
Q47 Andrew Miller: Finally,
it is therefore a great pity that the chief scientific adviser
said to the Lords that he was disappointed at the failure to be
consulted on changes in his own Department. The Times Higher
Education yesterday had the headline, "'Stupid, ignorant,
foolish': peers express dismay at potential loss of scientific
expertise in merged BIS post". Now, although David Willetts
has assured me today that my concerns and the concerns of the
scientific community will be met, isn't it time we had some more
transparency, proper engagement, with the scientific community
to stop these mistakes being made?
Mr Cameron: Perhaps I should take
away what you say and have a greater think about it. What I'm
finding is that the system of having a chief scientific adviser,
and indeed scientific advisers in each Department, is a way of
helping to make Government policy science-friendly. Have we cracked
the problem completely? No, I don't think we have, but I think
that is quite a good start.
Chair: Thanks very much indeed. May I
turn to transport and to Louise Ellman?
Q48 Mrs Ellman: At the beginning
of this meeting you told us that you had been involved in taking
a strategic look at the cuts and that you had wanted to protect
capital spending. You named a number of service areas that you
had taken that approach to. I was a little disappointed you didn't
mention transport in that. Looking at the actual facts, rather
than the rhetoric around the facts, capital spending in transport
is actually being cut by 11% and resource spending cut by 20%.
Now, that does not suggest that, in reality, you see transport
as such an important engine for growth.
Mr Cameron: I am afraid that I
would dispute your figures. We are going to be spending more than
£30 billion on transport infrastructure in the next four
years. That is actually more than what the previous Government
had planned, so those are the facts. Overall, we are spending
about £9 billion more on capital projects than the previous
Government planned. The reason I didn't have to get too involved
in the transport budget is that the negotiations between the Department
for Transport and the Treasury went quite well.
Chair: That is the point that I think
Mr Cameron: The reason it went
well is because
Q49 Mrs Ellman: But Prime
Minister, the figures I am using are figures from the review and
figures from the Treasury review. They are not figures that have
come from anywhere else. It might be true that it all could have
been worse, but you can't say that you protected capital spending
in transport in the way that you are alleging.
Mr Cameron: I think we can. The
point is, the previous Government announced a lot of cuts in capital
spending. We inherited that situation. We took that and, in some
cases, we added back in money. That is why I am able to say to
you that spending more than £30 billion on transport infrastructure
in the next four years is more than the previous Government planned.
That is a fact, and I think that's important.
The reason it was a relatively straightforward
negotiation between the Treasury and the Department for Transport
is because we had decided, strategically, to try to protect capital
and where possible to enhance capital, so I didn't get involved
in that particular area. I did have conversations with the Mayor
of London about the importance of the tube upgrade and the importance
of Crossrail, both of which we have managed to protect and are
going ahead, so I think it is a good settlement for transport
capital. Yes, like every other Department there are reductions
in departmental spending, but in terms of capital spending I would
say it is a very good outcome.
Q50 Mrs Ellman: There is clearly
a dispute on the figures and the facts, which we will pursue elsewhere.
At the moment there are very successful regional
structures that have permitted local authorities, working with
business, to decide strategic priorities for transport. Those
are now being dismantled and there is widespread agreement that
the proposed local enterprise partnerships will not be able to
replace those bodies looking at strategic, rather than very localised
transport. What are you going to do to make sure that regional,
rather than very localised priorities are determined in an effective
way and that areas outside London don't lose out?
Mr Cameron: That is a very important
point. I would come at it from a slightly different angle, because
I think that the regional bodies were often quite bureaucratic,
quite distant and, in some cases, there were endless studies done
but not much actual action. So I don't think it was a perfect
Q51 Mrs Ellman: In this instance
I am talking specifically about transport and specifically about
how regional allocations for transport were decided. All the evidence
from around the country is that the existing structureslocal
authorities working with businesswere very effective in
that regard. They are going. There is no clear effective replacement,
and we've heard from our Committee in Birmingham, in Hull, and,
in the last couple of weeks, from your own Secretary of State,
who said that some other structure will have to be put forward
for transport. Are you going to take a personal interest in this?
Mr Cameron: Yes, I will. It is
important that we allocate money properly. It should be done on
the basis of what has the greatest economic return. When we look
at these transport capital projects, we ask very good questions
about what is going to have the greatest impact on growth. For
instance, we are going ahead with the A11 in Norfolk, the improvements
on the M4 and M5 north of Bristol
Chair: Again, I don't think today is
the day for that valuable catalogue. Otherwise I will start asking
you about the A1.
Mr Cameron: Sadly, I'm afraid
that is not on my list.
Chair: I think Mrs Ellman is trying to
get at the issue of how you are going to get decisions of regional
Q52 Mrs Ellman: The danger
is that, without an effective regional structure for making decisions
on regional, rather than local, schemes, either decisions won't
be made effectively or they will become centralised. Your Secretary
of State has admitted to the Transport Committee that, if the
criteria adopted nationally were applied absolutely, we would
have more and more investment in London and the south-eastan
overheating of the south-eastand less investment in the
other regions. That is why it is very important that there is
a regional perspective. Will you take a personal interest in ensuring
that, in this change that you have already decided on, regional
perspective and regional prioritisation will not be lost in the
case of transport?
Mr Cameron: Yes, absolutely. All
I would say is that we can make a success of the local enterprise
partnerships, because they will go with the grain of what people
want locally and regionally. If you look at the decisions we took
in the spending round, there were some major investments into
the regions, and there are even more that will be announced. The
Government are extremely conscious of that.
Q53 Chair: Can I make a helpful
suggestion that you might like to write to us just to clarify
the answer to Mrs Ellman's question?
Mr Cameron: Delighted to.
Q54 Sir Alan Haselhurst: If
we look back over 60 years, we surely cannot be content about
the current state of the rail networkapart from one or
two shining examples of major improvementand passengers
are currently bracing themselves for another hike in fares. Doesn't
this make it more important that we get the nature of franchising
right? Such evidence as there is suggests that longer franchises
will encourage the successful bidder to invest more, actually
in partnership with Network Rail, to bring about the kinds of
improvement that will ease bottlenecks, improve flow and actually
then add, in total, to the amount of money that is being spent
to improve the network.
Mr Cameron: I basically agree
with that. I think that short-term franchises have meant that
there isn't the incentive on the operator to invest in the long-term
health of the line and its success. I think where we need to go
is longer-term franchises, but with tough penalties if they don't
live up to the things that they've promised to do. I think we
also have to have a really good look at why costs in the railway
industry have got so out of control. Roy McNulty is doing this
review for us, and I put a lot of store by that, becauseyou
may have had experiences in your own constituencywhen there
has been an examination of the case for an extension of a line
or for a new line, the cost figures are absolutely astronomical.
We have to get to the bottom of why that is the case.
Q55 Mr Betts: I want to look
at the way in which you've helped to try and join up Government
thinking in a number of respects, particularly looking at the
housing benefit changes. Do you accept that the fundamental problem
here is that the level of the housing benefit bill has risen because
the cost of housing has risen, which, fundamentally, is because
of a shortage of supply? If it is the Government's objective to
rectify that and, as the Housing Minister said, to build more
houses than were being built before the recession, why, in the
CSR, has the money for new affordable housing been cut by more
Mr Cameron: It is an extremely
good question. We have got to ask ourselves why we've been chasing
ourselves round in a circuit of increased housing benefit and
increased costs and, all the while, not building very many houses.
It seems to me that we've got to do two things. One is, for the
deficit problem, that we've got to look at the explosion of housing
benefitup by 50% over the past five years. We have to look
at that, because we have to get on top of the deficit. We also
have to ask ourselves whether we can have a system that would
encourage more house building, which would ease the constraints
of supply. Although I completely accept that we have cut the capital
money going into house building, I would argue that that system
wasn't working. We had big capital allocations going into housing
for the last decade, but it hasn't worked. It has pushed up the
price of land; anyone owning a bit of land outside one of the
towns we represent has done extremely well, thank you, but we
don't seem to have built very many houses.
What we are doing, as I have said, is getting
on top of housing benefit and making some difficult decisions,
but we are introducing some real changes to how we support social
housing and how we support and encourage house building, which
I believe will make a difference. For instance, the new homes
bonus will mean that from now on when local authorities build
houses in their areas, or allow houses to be built, they will
actually benefit. Right now, there isn't much of a benefit to
any of our local authorities deciding to support house building.
We need to change that fundamental regard in a more decentralised
system, which I think will answer your very good point.
Q56 Mr Betts: I am not sure
it does, Prime Minister. On the first point about new ways of
funding affordable housing, the new way is actually to make new
lettings of existing houses, or of the new houses that are built,
at 80% of market rates. Has any calculation been done as to how
that will increase the bill for housing benefit?
Mr Cameron: First of all, how
will it affect increased house building? I think the fact is if
you go to a rent-based model, it gives house builders the confidence
that if they build social housing, they know the sort of rent
they will be able to get.
Q57 Mr Betts: But it will
increase the housing benefit bill, won't it?
Mr Cameron: It will put some pressure
on the housing benefit bill, which is another reason why we are
trying to make sure that we get on top of the housing benefit
Q58 Mr Betts: Just in terms
of the new homes bonus, can you point to one piece of evidence
that shows that if you redistribute the planning grant that is
available for this purpose among the number of houses that you
need to build to beat the previous Government's progress before
the recession came, that would amount to about £1,300 per
property? Is that really going to be a sufficient incentive to
get you building more than 200,000 homes in this country? Is there
any evidence for that?
Mr Cameron: Yes; ask local
Q59 Mr Betts: No, is there
Mr Cameron: Yes; if you ask local
authority leaders, the ones I have spoken to say, "Right
now, although there are a lot of targets, there's not really much
in it for us as a local authority if we build houses, because
we don't really keep the revenue." Under the new homes bonus,
they will keep the additional revenue that they get. It is quite
a big move we are trying to make from a very top-down, centralised
system to a system where we say to local authorities, "If
you attract new business into your area, you keep the business
rate. If you get new houses built, you keep the revenue for those
extra houses." It is a change in the system, but given that
what we have just had didn't produce the houses and produced this
rocketing housing benefit bill with record numbers of people on
housing waiting lists, I think it's time to try something new.
Q60 Mr Betts: Given there
is quite a lot of evidence that the housing benefit changesnot
just in London but outsideand particularly the 30th percentile
rule, will actually mean that areas of cities such as Sheffield
are no longer affordable for people on housing benefit, including
those in work on low incomes, is it still the Government's policy
to have mixed communities or is there now a disjunction between
the policy of DWP and the policy of CLG?
Mr Cameron: Of course we want
to have mixed communities, but what we are trying to dosomething
that is quite widely shared across the political spectrumis
to move to a situation where we are not asking working people
to pay taxes to support people in housing benefit-funded houses
that they couldn't live in themselves.
Q61 Mr Betts: Many of whom
are in work. Many people on housing benefit actually work.
Mr Cameron: Absolutely. But I
think the general principle that I just enunciated
Q62 Mr Betts: So that actually
goes against the policy of mixed communities, then, does it?
Mr Cameron: No. As I explained,
we support mixed communities, but we have a situation now where
you have people claiming £20,000, £30,000, £40,000
or £50,000 per year in housing benefit. You have people in
Sheffield paying their taxes so that people can live in houses
that they themselves couldn't dream of living in.
Chair: Order. Anne Begg.
Q63 Miss Begg: Thank you,
Picking up on what you have just said, Prime
Minister, a lot of people accept that the housing benefit bill
had to be brought under control, and you have given us some examples.
There are quite a lot of different aspects to the policy and to
the cuts in housing benefit, and I want to home in on one particular
one, because I don't understand the rationale for it. I have heard
the rationale for all the others, and you have just given some
detail about why the caps have been brought in. This one is about
those who have been a year on jobseeker's allowance. After they've
been on jobseeker's allowance for a year, they are to lose 10%
of their housing benefit. I've looked through everything I've
received as Chair of the Select Committee and from elsewhere,
but I cannot see, and I haven't heard, a Government Minister explaining
the rationale behind that particular decision to cut 10% from
the housing benefit of those who have been out of work for a year.
Mr Cameron: I think the rationale
is this: everybody knows that, in some cases, the fact that somebody
is on jobseeker's allowance and housing benefit means that the
incentive to work is less, because there is a danger of losing
the jobseeker's allowance and the housing benefit. So the idea
behind that 10% reduction is to sharpen the incentives to work.
Taking the example of London, in London there are 34,000 people
who have been on jobseeker's allowance for longer than a year.
They are all people who are supposed to be available for work
and seeking a job, and in London there are 30,000 new vacancies
in any given month400,000 new vacancies each yearso
that is the reason for that.
Let me make one more point: 90% of people on
JSA do find a job before the end of a year, and we will be introducing
the Work Programme to make sure that we try to help everybody
find a job as quickly as possible. So I hope that this policy
will have as little effect as possible but, none the less, because
of the link between JSA, housing benefit and incentives to work,
I think that it is worth pursuing.
Q64 Miss Begg: Let's hope
that it has quite a lot of effect, because in the Red Book it
is proposed to save £100 million in the first year and £110
million the year after, so these are not small amounts of money.
You are looking perhaps to lessen the marginal tax rate for someone
going into work, but it shouldn't be the case that someone who
has been out of work for a year loses 10% of their housing benefit,
regardless of whether in that year they have moved house to find
somewhere cheaper. We may have a position where someone has done
everything that the Government have asked of them, but will still
be affected. They have signed up for workthey are on JSA,
yes, but they have gone to all the appointments that Jobcentre
Plus has made for themthey have gone to all the interviews,
they have applied for hundreds of jobs, and, with the best will
in the world, they have not been able to find a job. This will
be the first time in the welfare history of this country that
sanctions are brought against such a person who has done everything
that the Government have asked of them. They will still be sanctioned
and they will still lose their housing benefit. That is quite
a big change so, again, I come back to my original question: what's
the rationale behind that? It's not going to encourage people
into work, because that sanction will follow them wherever they
try to move. They are going to have less money with which to get
into work, because they won't have the money to pay for transport
and all the other costs associated with work.
Mr Cameron: I don't really accept
that it won't increase the incentive to work because, as I have
said, there is a problem. We all know that there is a problem
where people are on jobseeker's allowance and maximum housing
benefit, which can be an incentive not to work.
Q65 Miss Begg: But some of
those individuals might already have moved to the cheapest house
that they can find, but after a year they will still lose 10%
of their housing benefit. If you are on £65 a week JSA, to
lose 10% of your housing benefit is quite a large proportion of
your income, which is meant to help you get into work. That just
won't happen, so what you're saying really doesn't add up.
Mr Cameron: We're saying that
we want to do much more than currently happens to help such people
to get work in the first place. The whole point of the Work Programme
is that it will give tailored help and supportnot just
from the state, but from voluntary bodies and private sector organisationsto
help those people into work. So, yes, there is a number scored
in the Red Book, but, obviously, if we can get people into work
faster than that and reduce that number, we will be getting more
tax revenue from the people who we get into work.
I have to bring you back to the problem of housing
benefit. Here is that benefit, which is up 50% in the past five
yearseveryone accepts that it's out of controlso
we have to take steps to deal with it. We have tried to take a
range of different steps: introducing the housing benefit caps;
moving to the 30th percentile; this issue; and a number of other
things, including the single room rate extension. None of those
steps is easyI completely accept that none of those things
is easy. It's no good saying, "We're all in favour of getting
on top of housing benefit," but then saying, "Well,
I don't like this change, that change or the other change."
We have to try to find a package of changes for housing benefit.
It's not going to be radically reduced; all we're going to be
able to do is to try and stem the increase and perhaps have a
Miss Begg: But I
think my point is that this particular measure is actually counter
to everything else you're trying to do. It's also worth pointing
out that people won't go into the Work Programme until they've
been on JSA for a year, so they only get the help once they've
already been sanctioned.
Chair: I think we have come to a straight
point of disagreement. No doubt you will want to take Miss Begg's
thoughts away and reflect on them. Margaret Hodge has a quick
Q66 Margaret Hodge: This is
just from a constituency point of view. Prime Minister, you said
that you support mixed communities, but it is undoubtedly the
case that the cap and the 30th percentile that you will be introducing
in the housing benefit changes will mean that poorer people cannot
afford to live in rented accommodation in Notting Hill, where
you live, Islington, where I live, or in Westminster, where we
all work. They will be forced out to places such as the one I
representBarkingwhere you know that pressure and
social unrest is already being caused by very rapid changes in
population and the lack of affordable housing. I simply ask you
whether social unrest is a price worth paying and about the impact
that can have with the extreme right.
Mr Cameron: Margaret, find me
a street in your constituency, and let's go down it together and
ask the people living there who are earning £20,000, £25,000
or £30,000 whether they are happy to be paying towards the
rent bills of £30,000, £40,000 or £50,000 of people
living in central London. Frankly, I think that is more likely
to lead to social unrestwhen people find out how much money
they're paying in taxes for people to live in houses they couldn't
dream of living in themselves.
Q67 Margaret Hodge: I don't think
you understand the anger in my constituency at the inability to
Chair: Order. This is not Wednesday afternoon.
Mr Cameron: They're not helped
by the fact that we are wasting money.
Chair: Order. Prime Minister, we do constituency
business on Wednesday afternoons.
Q68 Keith Vaz: I think we'd
all like to come down this street in Islington when you and Margaret
Hodge go for a visit.
Yesterday, the deputy leader of the Labour party
and you had a robust exchange over police numbers. This morning,
I telephoned the chief constable of Greater Manchester, who confirmed
that if these cuts are implemented, he will lose a quarter of
his work force in four years. As you know, the Police Federation
has talked about 20,000 front-line officers going and KPMG, in
an independent study, has talked about 18,000. That is definitely
going to affect front-line services. Do you agree?
Mr Cameron: I don't necessarily
agree, because it's going to depend on how well we manage our
police forces. I didn't use this quote yesterday, so I'm not breaking
our rule of the first sign of madness being quoting your own speeches,
but Peter Fahy, the chief constable said: "the end result
will be more resources put into frontline policing and a more
efficient and effective service for the people of Greater Manchester."
Sorry; I should have read the first bit of the quote too: "While
the situation is obviously unsettling"and clearly
it is unsettling, which is why we are having this debate"the
end result will be more resources put into frontline policing".
Since yesterday, I have found some more figures.
The total number of police officers in Greater Manchester is
8,000, and there is a total police staff of 4,200. Whoever was
in governmentif Gordon Brown were sitting herewould
have to reduce the Home Office budget and make difficult decisions,
and we'd be saying to the police, "You are going to have
less money over the next four years." As politicians, leaders,
and the rest of it, the question is to work out whether we can
try and get more for less. I don't want to single out Greater
Manchester, but when you look at 4,000 staff as opposed to 8,000
officers, and when you look at 187 people in human resources,
we have to do better than that. If he himself seems to be saying
that the end result will be more resources put into front-line
policing, let's get behind him and try to deliver that.
Q69 Keith Vaz: Sure. Yesterday
you were very clear, and you are clear today, that there are back-office
staff, who you kept mentioning yesterday in your reply. I have
a list of 86 different kinds of posts that exist in a local police
office. The fact is that we are not expecting police officers
who we want to see on the beatvisible policing, which is
what our constituents wantto do the jobs of, for example,
a telephonist, a payroll manager or a caretaker. There has to
be a line.
Mr Cameron: Absolutely. No, if
anything, one of the problems was that because the last Government,
for understandable reasons, targeted the number of officers, we
ended up with officers doing HR, IT and back-office functions.
When you set a target like that, people do rather perverse things
in order to meet it. What we have to focus on is visible policing
on our streets and trying to minimise the back office that is
there to support that.
Now, what are we doing to help this process?
Well, we are freezing police pay for two yearsit is a difficult
decision, but that will help police forces. We are looking at
the allowances and trying to rationalise some of them. We are
getting rid of the forms I mentioned yesterdaythe stop
form and otherswhich will massively reduce the hours spent
on police time. But we all need to say to our police forces, and
I will have this conversation in the Thames Valley, "What
are you doing to procure your vehicles with other forces? What
are you doing to share helicopter assets? What are you doing to
combine your diver teams?" There is a huge amount. I don't
want to see force amalgamations. I think that was a mistake the
last Government madepeople don't want itbut you
can certainly amalgamate a lot of support functions, saving money.
I think there is a big agenda there. We have hardly even scratched
Q70 Keith Vaz: Prime Minister,
you are right that there is a big agenda but your own chief constable,
Sara Thornton, said that she would see a noticeable reduction
in service. That means not providing something that was provided
before. If, as a result of these cuts, crime rises in Thames Valley,
for example, and in other parts of the country, would you look
again at the police budget in order to make sure that they have
the resources they need?
Mr Cameron: Of course, this Government
will have an ongoing process of looking at how well we are doing,
how money is being spent, whether we are getting value for money
and the rest of it, but I think we should start from the proposition
that we have got to try to get more value for less from the police.
Sara Thornton, the chief constable, actually came to my constituency
surgery to discuss this and she saidI hope I'm not misquoting
herthat looking at things like a 15% reduction was manageable.
Now if we can make the difference between the 15% that some police
forces think is manageable and the figures set out in the Red
Bookwe can do that through the freeze, through paperwork
reductions and through changing allowancesI think this
is deliverable without seeing a reduction in visible front-line
policing. It is going to be challengingof course it isbut
let's start from the proposition that all of us should be saying
to our forces, "What are you doing to try to take costs out
of the back office?"
Q71 Keith Vaz: A final question
about the disorders of last week or the week before last. Clearly,
mistakes were made and there is going to be an investigation by
the Metropolitan Police Commissioner. If it is found that a lack
of resources contributed to this problem, would they be provided
by the Government in the future?
Mr Cameron: I spoke to Paul Stephenson,
the Metropolitan Police Commissioner. I was in Korea, obviously,
for the G20. In our conversation, he did not mention resources
at all. I am not surprised. Frankly, this was a failure, as he
put itI'm not criticising him and I think he was very candid,
upfront and honest about itof intelligence and a failure
of planning, and it shouldn't happen again. It was an extremely
thin blue line in front of that building, and we saw that blue
line, frankly, pushed away, swept away almost by that very badly
behaved crowd of people, who did appalling things when they got
into that building, by the way. That should not happen again,
and I know that Paul Stephenson won't let that happen again. There
are, I think, plenty of police officers in London to stop that
from happening again. I don't think it was a shortage of resources;
it was a failure of planning and intelligence, as he himself has
Q72 Mr Robertson: Prime Minister,
the background to my question on Northern Ireland is the increasing
terrorist threat which was recognised by the Home Secretary back
in September, when she increased the assessment level. I know
that the decision on the police budget is devolved, but obviously
you have responsibility overall for security. Is it your understanding
that the police budget in Northern Ireland will remain the same?
Or will it be increased or lowered in the coming years?
Mr Cameron: Obviously, it is a
devolved issue; it is a matter for them. I completely agree with
you that the security situation is troubling. It is an issue that
has been discussed by the National Security Council. We clearly
look at all the things that we can do to help and all the contingency
plans that we have to make. I think we are standing by the commitments
made by the former Prime Minister in terms of the training college
for police and other servicesthe capital expenditure. Obviously,
the decision makers in Northern Ireland will need to make their
decisions about how to spend their money, but security must be
a very great concern with what we have seen.
Q73 Mr Robertson: As you are
aware at Hillsborough just before policing was devolved an agreement
was made by the last Government which the Conservative party said
it would honour. Again, I understand that the matter is devolved,
but will the Northern Ireland Executive have sufficient money
to be able to provide the police with the resources they need?
There is a growing threat. A third of the police budget, according
to the Chief Constable, is spent entirely on security matters;
they have all the other issues to deal with, just as police forces
Mr Cameron: We believe they have
what they need. We are standing by the commitments made by the
former Prime Minister and believe that we are meeting them. Obviously,
this is something we have to keep under review and look very closely
at the circumstances they are in. There was agreed access to the
reserve, as proposed by the former Prime Minister. We stick to
that. On devolved policing and justice, it is important that we
say to colleagues in Northern Ireland, "You must try to make
the best decisions you can with the budget you have, allot your
resources accordingly and then come back to us if there is a real
problem." Having devolved, we shouldn't try to stand on their
shoulders the entire time. It is important that that is the case.
Q74 Mr Robertson: I understand
it is up to them to decide how they allocate the money they are
given, but it is your decision how much they are given. The Select
Committee was in Ireland just last week, and the Assistant Commissioner
of the Garda, in spite of the difficulties they have, gave us
an absolute, categorical assurance that there would be no let-up
on policing, particularly of the border area with the Republic.
Can we give that same guarantee in Northern Ireland?
Mr Cameron: Yes, I believe that
we can. Perhaps I could write to you, because this is a very important
area and I don't want to mislead you in any way. I believe that
we can. That is the question we asked in the National Security
Council and the discussion that we had. I would make the general
point to remember that it is important for all the devolved areas.
In Northern Ireland, public spending is 25% per head higher than
in the UK, and its overall settlement is -6.9%, compared with
a situation in many Departments that is a lot tougher than that.
Perhaps I will drop you a line about the precise terms and what
guarantee I think we can give about the level of border security.
Q75 Mr Robertson: Finally,
the Secretary of State has said that there won't be any more open-ended,
very expensive public inquiries into the past, and that that will
be the responsibility of the Historical Enquiries Team. Again,
given the budget constraints, will that team be able to carry
out the work that it needs to carry outif it is going to
be responsible for itto the satisfaction of people in Northern
Ireland, who have been so desperately and badly affected by the
Mr Cameron: That's a very good
question. I hope it will be able to. I think that, following Saville,
we should try to avoid open-ended inquiries in the way that you
say. That puts a burden on the Historical Enquiries Team, which
has a huge amount of work to do and limited resources. Of course,
that is something we can look at. Coming to terms with the past
is a very big part of the peace process. I completely understand
that and would like us to try to do it, while avoiding big inquiries
if we can.
Chair: The major part of our time has
been devoted to the spending review, so I want to turn to some
other issues. The first is the Government's claim and aspiration
to be the greenest Government ever.
Q76 Joan Walley: Prime Minister,
you said that you want this to be the greenest Government ever
and have given a great fanfare to that. Listening to the exchanges
so far, it struck me that, on transport policy, you said that
money is to be allocated properly on the basis of greatest economic
return. Where is sustainable development in all of this? What
are you doing to embed sustainable development, so that when decisions
are being made, it is not just economic decisions, but environmental,
social and right the way in this cross-cutting way?
The coalition Government have abolished the
Sustainable Development Commission, so there is real concern about
what will take its place, how sustainable development will be
embedded and how it can be monitored. Will there be targets? How
will we know that they have been the greenest Government ever?
Mr Cameron: Okay. You are quite
right to pull me up on my answer on transport. All transport projects
are looked at in terms of not only their economic benefit, but
their environmental impact.
Q77 Joan Walley: How? That
is the question.
Mr Cameron: By taking into account
their impact on the environment, carbon and all those issues.
In terms of the Sustainable Development Commission, what we have
tried to do, in a difficult spending round, is to put money into
things that will make a differencelike the green deal,
like carbon capture and storage, and like a green investment bank,
which will have real money to spendrather than have quite
so much monitoring and evaluation.
In terms of how we will know how we're getting
on, because of the last Government's Climate Change Bill, which
we supported and in many ways proposed, we have the carbon budgets
so that we can see how we are making progress. Look, obviously,
we made difficult decisions in the spending round, but I think,
overall, when you look at what we managed to do on the green front
in terms of CCS, feed-in
tariffs, renewable heat incentive and the rest of it, I think
it got a pretty warm welcome from green groups and I think deservedly
so, because we took some difficult decisions to safeguard some
Q78 Joan Walley: I want to
ask briefly about the proposals for the green investment bank
and those measures that you have just described, but just before
we leave this subject about embedding sustainable development,
surely, it has to be done in a cross-cutting way. Is this something
that you are going to give your own personal commitment to? Is
there going to be a Cabinet cross-cutting committee? Because it
is not just about how green are your Government estate policies;
it is how you embed it into every piece of regional policy, transport
and defence. I haven't heard that mentioned at all just now.
Mr Cameron: That's a very good
point. What we've done across Government is have, for each Department,
quite clear structural reform plans. So instead of setting targets,
we've actually just set out what each Department is going to do
in terms of the legislation it will pass, the appointments it
will make and the regulations it will introduceexplaining
what it will do to reach the outcomes we all want. Obviously,
that begs a huge question: what about things that cut across Government?
With carbon and greenery, we need to have a cross-cutting structural
reform plan, which we will put in place. I think that you are
completely right about that and perhaps I can write to you with
some details about how that will work.
There are some issues that cut right across Departments, and this
is obviously the most important one.
Q79 Joan Walley: Just one
quick question then: you employed Sir Philip Green to review Government
efficiency and to look at the whole issue of procurement. Did
his specification from you include what to look at in terms of
Mr Cameron: His commission was
really to look at cost saving. It wasn't part of a green agenda;
it was really: let's just get someone from the outside to come
and look at things such as procurement, IT and some of things
that Government do centrally. I think he produced a reportit
goes back to Margaret Hodge's question, reallycan we have
some confidence that we can actually remove some of these back-office
costs without cutting the front line? That is more what it was
Q80 Joan Walley: But isn't
the danger, before you have a look at your briefing there, that
that will set the whole ship of Government in one direction and
not look at embedding sustainable development and actual green
procurement, which could do huge amounts to improve local economies
and, at the same time, reduce emissions right the way across the
Mr Cameron: I don't think it will
embed that thinking because we are providing transparent information
on environmental performanceand transparency is the best
thing you can do on this frontand we are going to be publishing
the carbon footprint of our supply chain. Those things are embedded,
but the specific purpose of Sir Philip Green was to just look
broadly across Government at cost-saving measures and what they
could achieve. Certainly, because we have carbon budgets through
the Bill, because we have this approach on transparent information
and the carbon footprinting of our procurement, I think all those
things will beI'm going to sound like a jargon kinghardwired
into our approach. There we areI'll try not to roll out
any more pilot schemes in the next 10 minutes.
Q81 Joan Walley: Finally,
on the green investment bank, which I think everybody agrees is
going to be so important, is it really, truly going to be a bank,
or is it going to be a fund? Is there likely to be a dispute between
the Treasury and the Department for Business, Innovation and Skills,
and might you be taking as keen an interest in this at Cabinet
level, as you did in the comprehensive spending review that we
have just heard about?
Mr Cameron: Yes, yes, yes and
yes to all of those questions.
Q82 Mr Yeo: Prime Minister,
there is no more ardent supporter of your aim to lead the greenest
Government ever than myself, though another policy I am equally
enthusiastic about is that for fixed-term, five-year Parliaments.
Now we know that the next general election is in 2015, can you
tell us what criteria you will use to judge the success or failure
of your Government as the greenest Government ever?
Mr Cameron: When we produce the
structural reform plan that goes across Government for carbon
and greenery, we will be giving you the weapons, as it were, to
beat us if we don't fulfil all the things that we said we would
do. These structural reform plans are not a thrilling read, I
have to accept, but they are very clear. In the one for Chris
Huhne's Department, it says: set up a green investment bank, deliver
the carbon capture and storage pilot, establish the green deal
with all sorts of benchmarks about when it needs to be done, introduce
the renewable heat initiative by a certain date. I don't just
want to wait for five years to see whether we've been any good
at this stuff. I want to give you the tools, so that when I come
back herewhenever it isyou can say, "Your structural
reform plan said you were going to have done X by now. Why haven't
you done it?"
It is not targets, because what tended to happen
in the past is that we set targets for things, missed them and
then said, "Well, shucks, that's life." This is actually
setting the actual act that you've got to take, and then you can
see whether you've taken it or not. I think we've got a good list
of things in this area, such as introducing feed-in tariffs. I
have mentioned the renewable heat initiative and CCS. There is
electricity market reform and the 10% cuts for Government Departments
by the end of the first year. There is a pretty good set of things
that I think you'll be able to judge us againstall within
the carbon budgets that were set out by the previous Government.
Q83 Mr Yeo: There will be
some quantifiable measurements. You may not want to call them
targets, but we will know how many million homes have availed
themselves of the green deal and how many renewable, low-carbon
energy projects, which have got planning consent and have been
funded, are in the pipeline. So we'll know what we'll have by
2020. We'll know how much money the green investment bank has
lent or invested. Those will actually all be measurable.
Mr Cameron: Absolutely. The proof,
as it were, is that Cabinet Ministers are already complaining
that they've had to put things into their structural reform plans
that they may not be able to meet, and it'll make life very awkward
in front a Committee like this or the House of Commons. That is
part of the point in a way, which is to try to have a set of plans
that are quite measurable and verifiable and that are not all
in far-off target land. They are on actual concrete things that
you do on the ground. So I hope that we'll be able to chart the
progress as we go along.
Q84 Mr Yeo: Do you accept
the suggestion from the Climate Change Committee that electricity
generation should be substantially decarbonised by 2030? Just
to put that into context, it would mean an 80% reduction in emissions
per unit generated by 2030.
Mr Cameron: Basically, yes, for
the reason that people are only just waking up to, which is that
if we are going to move to a world of electric cars and more ground-source
heat pumps and, effectively, electricity-backed heating in our
homes, we are going to see a potentially massive increase in electricity
demand. If we don't decarbonise electricity, we've got no hope
of meeting all the targets that we're all committed to. There
are intensive discussions in Government right now about how we
best reform the electricity market to make that happento
what extent do we need all the different tools to make this happen
and what sort of energy mix is likely to result in terms of nuclear,
gas, wind and other renewables? So, yes, I do accept the basic
proposition, and a huge amount of work is being done, and I think
the DECC is doing it very well.
Q85 Mr Yeo: You have mentioned
carbon capture and storage, and the first competition is fundedit
was announced in the CSR at £1 billion. Have you decided
how to fund the remaining three competitions to which the Government
Mr Cameron: No, we haven't yet.
We are committed to them, as you said. It was important to have
that £1 billionit is quite difficult to hold on to
£1 billion in a tough spending roundfor the first
carbon capture and storage project. It will put Britain a long
way ahead of other countries, but, obviously, we couldn't do everything
we wanted to.
Q86 Mr Yeo: Do you accept
that, if we are going to achieve these goals of decarbonising
electricity, which in turn will enable us to achieve the carbon
budgets that the Climate Change Committee is setting outanother
one is coming next monththe inevitable consequence of that,
coupled with our concerns about security of energy supplies, is
significantly higher electricity prices?
Mr Cameron: I think that electricity
prices were going to rise anywayif I can put it that waybecause
so much of our electricity infrastructure is out of date and because
so much of our nuclear industry is about to come to the end of
its life. There was an increase in electricity prices built in
The debate that we're having at the moment is
on what sort of model our electricity market should be going forward.
Do we want to go on with this quite market-based model and to
just have targets for carbon reduction and allow the market to
deliver that carbon reduction? Or do we want to take the slightly
more planned view that we want to try and effectively shield the
public from excessive further rises in electricity prices by having
some quite long-term guaranteed feed-in prices. There is a proper
debate going on around the table, as with the other areas of Government,
about what sort of model will deliver what I think we all want,
which is decarbonised electricity, good security of supply and
some certainty about pricing.
You are quite right, however, that prices are
on an upward trajectory. They would have been anyway, but if we
go for a slightly more planned approach we may be able to protect
people from very big oscillations in prices. Frankly, no one knows
what will happen to oil and gas prices, particularly with the
discovery of so much shale gas. Is that a real game changer in
energy prices? I don't think we know that yet, and I don't think
we should take a risk on that basis.
Q87 Chair: When do you expect
a conclusion of this debate? We are just entering winter, when
people are going to be worrying about energy prices.
Mr Cameron: This debate doesn't
really affect the current year; it is more about looking ahead
at how we will structure the electricity market. With all these
subjects on which the coalition hasn't yet completed its workwhether
that's immigration, control orders or this issue of energy policyso
far, I would argue, we have gone through difficult subjects such
as higher education, the comprehensive spending review and defence
and we have come up with good, well-thought-through answers. We
will do the same on this, but it will take a little bit of time.
Q88 Miss McIntosh: Prime Minister,
you have described DEFRA as the "fourth emergency service".
It is responsible for two of the greatest risks that the country
might face; first, as in Cornwall at the moment, the risk of flooding
and, secondly, the risk of animal disease outbreak. Why did you
impose the second largest budget cut on the green Department?
Mr Cameron: Describing these cuts
as imposed is a slightly pejorative way of putting it. We had
to find reductions across Government, and the Departments that
were not protected had to find some quite big reductions. What
we have done in DEFRA is to preserve the important areas of spending.
On flooding, for instance, we will be spending £2.1 billion
on flood and coastal defences over the next four years, which
is broadly the same as the amount we spent over the past four
years. We can actually add to the Pitt review, because it should
be possible for local areas to top up grants that are given to
them for flood defences.
In terms of animal health, we are spending £356
million a year on this, and it is only fair that we ask the agricultural
industry to share some of this cost. Obviously, it should be able
to share some of the decision making about how the money is spent.
Q89 Miss McIntosh: I'd be
interested to know how you think the local areas are going to
top up, when we are already topping up through levies to the flood
defence committees. In your debate in May 2008 after the flooding
in Witney, you were very concerned about the level of funding
of the Environment Agency. The rural communities were not benefiting
quite so much and there was a severe shortage of flood engineers.
We know what is in the comprehensive spending review regarding
flood defences, but we are not aware of how the cuts to local
authorities will impact on flood defence spending when they take
over the role for flood risk management schemes from 1 April.
Mr Cameron: That is an extremely
good point. I would say that the Government have their responsibility
to fund flood defences properly, which I think we are doing. I
have found in my constituency that, yes, there is a concern that
rural areas get left out, because you can never find the same
number of houses at risk as you can in large urban areas, but
I also find a frustration that, sometimes, just because you don't
make the mark for what the EA would fund, you tend to get nothing
rather than everything. The idea that Sir Michael Pitt looked
at, which we support and will be making some announcements about,
is that it should be possible for local areas and communities
to say, "Even if we can just get a little bit of funding
for that project, we can add to it ourselves." At the moment,
there is quite a lot of all or nothing in the way it works.
Q90 Miss McIntosh: We know
that you like trees; are the Government still committed to their
tree-planting programme? Can you give an assurance today that
in the sell-off of any part of the Forestry Commission estate,
elevated projects such as the one in North Yorkshire at the momentwhere
trees are being planted and peatlands are being created; it has
biodiversity and flood defence issueswill not be jeopardised
in any way?
Mr Cameron: I think I can give
that assurance. We need to have a good tree-planting programme
in this country, but in terms of the Forestry Commission I don't
think it is absolutely vital who owns a piece of forest. The question
is whether there is good access to it, whether it is well kept,
and whether it supports biodiversity. Those are the questions
Almost 70% of England's forests are owned by
private companies or individuals. There is an idea that a forest
is only worth while and benefiting the nation and the public if
it is publicly owned. We don't apply that idea to other areas,
and I am not sure that we need to apply it to forestry. We want
it to be properly regulated, and we want the Forestry Commission
to do its job, but I think that people shouldn't be worried about
the innovative financing that we are looking at.
Q91 Miss McIntosh: Finally,
are you aware that one of the perverse consequences of the Fixed-Term
Parliaments Bill and the fact that there won't be a Queen's Speech
until November 2012 is that there will be a delay to the Water
Bill, which is meant to be a flagship policy?
Mr Cameron: I am not aware of
that. I don't necessarily see why it should cause a delay, because
the reason for this long Session is to get in sync with Queen's
Speeches in the spring/summer, when the election would be, which
is a logical move. That doesn't stop us introducing legislation
before the next Queen's Speech. That might just be an excuse that
you're being given. I will go away and see if I can find out.
Perhaps they haven't finished drafting it, or something, rather
Chair: A very quick word from Mr Clifton-Brown.
Q92 Geoffrey Clifton-Brown:
Sorry, Prime Minister, but I want to go back. In terms of decarbonising
the electricity sector, do you accept that in the future we will
need a substantial nuclear power-generating capacity? If you do,
do you accept that urgent decisions are needed, so that we get
new nuclear power stations built in time for when the existing
ones are decommissioned?
Mr Cameron: I do think that nuclear
is likely to play a good part in the new mix of electricity. I
think that it should be done on the basis of no specific nuclear
subsidy. I hold to that, and I think that it's right. We shouldn't
be giving guarantees to businesses on clean-up costs for which
they are not prepared to take responsibility. I am encouraged,
and I have had meetings with EDF, which is going ahead with building
nuclear power stations in this country. I think that EDF is confident
that the decisions that need to be made are being made to give
it the certainty to make the investment. It seems to me that we're
cracking on with the decisions that are necessary to give that
Chair: I hope that Mr Miller has a question
that admits of a short answer.
Q93 Andrew Miller: In your
answers to the previous four questioners, you covered issues that
have massive science and engineering implications, yet earlier
you seemed to accept that there hasn't been such cross-cutting
collaboration in the establishment of your science policy. Starting
tomorrow, are we going to see such cross-cutting work in all areas
of science and engineering?
Mr Cameron: I think, Andrew, that
you are saying that I need to spend more time with my scientific
advisers, and I will certainly do that.
Q94 Mr Jenkin: On the questions of
national strategy, forgive me for asking a slightly cheeky question,
but did you ever hear of an organisation called ARAG?
Q95 Mr Jenkin: Well, it was an organisation
based at Shrivenham Defence Academy. ARAG forecast that there
would be a banking collapse and that it would be the largest risk
to the security of the nation. Unfortunately, the then Prime Minister,
Gordon Brown, excluded it from his national security strategyhe
very deliberately did soand it was abolished to save £1
million. Do you agree that there is a lack of such strategic thinking
capacity in government?
Mr Cameron: I
think that the answer to that is probably yes. In the modern world,
Governments inevitably get very focused on the short term, on
what has to be delivered, on the next Queen's Speech and on the
legislation that is being drawn up. It is important to try to
get Governments, or people in government, to stop, to sit back
and to look at the big picture, to think strategically and to
take time to think. It's extremely difficult to do that, because
of all the pressures of political and Government life. I hope
that we did that in our strategic defence review. We purposefully
separated the security strategy from the subsequent work so we
could spend some time looking at the risks and opportunities for
Britain. Did we spend long enough? People will always be able
to make an argument for spending longer, but I accept the general
premise that there is not enough strategic thinking in government
as a whole. That is because of all the pressures that are faced.
Q96 Mr Jenkin: In our report "Who
does UK National Strategy?" we very much welcomed the establishment
of a National Security Council as a big step towards better strategic
thinking, but we also recommended that the Government should recognise
that there is a community of strategic thinkers in government
who should be treated and trained as such. There used to be a
six-month Civil Service College course on strategic thinking;
there is now only a one-week module. Will you take forward these
recommendations that we should educate strategic thinkers across
Government, like we educate statisticians and finance managers,
so that Ministers are given better support on all the possibilities,
analysis and assessment of the parameters of the decisions that
they have to make?
Mr Cameron: I will certainly look
at it. Part of the problem, and it sort of goes to Andrew Miller's
question about how we consider science, is that it is all very
well training up the strategic thinkers and having Government
scientists, you need to make sure that the politicians have got
a bit of time to stand back and listen to what the strategists,
the scientists and others are telling them. That is the difficult
thing because inevitably there are the huge pressures of what
has to be done today, tomorrow, this year, next year, rather than
trying to think five or 10 years in advance. We have to try to
find a way to do that better. It is about how Parliament works.
It is about how the national debate works. It probably has something
to do with m'learned friends from the press as well. We have to
try to do that better as a country. I don't think there is any
one single answer. I suspect that having good, well-trained people
to help you do it is part of the answer.
Q97 Mr Jenkin: Part of our
report is about understanding what we mean by strategy, which
has become a ubiquitous term that we use in place of "plan"
or "plan of action". Strategy is about reacting to the
short term intelligently, as well as planning for the long termit
is not just about horizon scanning. Could I invite you to consider
that Ministers will be able to do their jobs better if they are
more often confronted with alternative scenarios and different
parameters? If that staff workif that business of analysis
and assessmentis done, much like it is done through the
Joint Intelligence Committee and the joint assessment staff for
intelligence and security purposes, it needs to be across a broader
range of policy.
Mr Cameron: I agree with that.
Chair: We didn't think you would say
no to it.
Mr Cameron: I do agree
with that. You have to make sure that this is not just motherhood
and apple pie and, "Yes, we must all spend more time thinking
strategically." You are right that it is sometimes about
how you react to short-term things as well as planning for the
long term. I have been pleasantly surprised by the way that if
you create something like the National Security Council, the machinery
in the Cabinet Office underneath it enjoys doing, and does do
quite a lot of, strategic thinking about resilience, about threats
and about future developments. Things like cyber warfare will
be a massive problem today and in the future. I have been quite
impressed that people are thinking strategically and advising
us strategically about these issues.
Q98 Mr Jenkin: But the NSC
has very few staff and we recommend that it be given a responsibility
for national strategy, rather than just threats and contingencies
and the negative stuffabout the positive possibilities
and opportunities facing our country as well as the risks.
Mr Cameron: I saw that
bit of your report. I think the only difficulty is that if you
are not careful, national strategy then becomes what the Cabinet
ought to be. If you so broaden it, you might find that the National
Security Council loses its very important focus on security and
goes off into all sorts of different tracks, and we lose something
that is really vital: that we are thinking about our national
security in the round.
Q99 Richard Ottaway: Prime
Minister, one of the welcome objectives of the National Security
Council is its efforts to improve cross-departmental co-operation.
But going against the grain of that, we've got single departmental
budgets, which tend to hinder cross-departmental work, and we
have abolished public service agreements, which used to set cross-Government
goals. Do you think you are doing enough to incentivise cross-departmental
co-operation in this field?
Mr Cameron: That's a very good
question. I think so. We looked at this in opposition and again
in governmentshould you do more to pool budgets? It gets
fantastically complicated. It seems to me that the right answer
is that if the National Security Council is discussing Pakistan,
and it comes to a series of conclusions about what our stance
and relations should be, every Department should follow those
conclusions. So, DFID will be spending more money on mending a
fragile state, the FCO should be upgrading its relationship, and
so on. Every Department has a consequence from what the National
Security Council has decided. I do not think that it matters that
the whole budget is not pooled, as long as Ministers are incentivised
and judged on whether they are delivering what the National Security
Council has decided.
Q100 Richard Ottaway: Moving
on, I had the privilege of being there when you signed the bilateral
treaty with France the other day. What priority are you going
to give to bilateral agreements over multilateral agreements,
such as the NATO agreement? How do you see the two slotting into
Mr Cameron: I don't think that
it's an either/or. NATO is the cornerstone of our security. I
am going to the NATO Council this weekend. The reason for the
French agreement was that we are just two countries with very
similar armed forces which both want to see sovereign capability
enhanced, so it makes sense to combine in some areas, because
we will get more bang for our buckor, indeed, our franc.
Sorry, not franc; euro. I don't want to contribute any further
to euro woes. Where was I?
I don't think that you have to choose between
the two. The question I ask is: what is in our national interest
and what maximises our national interest? Does membership of NATO?
Yes, of course it does. Does a big aid budget? Yes, it does. Does
a deal with France over defence? Yes, it does. It is simple: what
is our national security and how do we best deliver it?
Q101 Richard Ottaway: Can
you see us offering bilateral assistance to France in one of its
Mr Cameron: If, for instance,
the French came to us and said we should work together because
there is a problem in Kosovo or an African country, we would decide
separately on each occasion. There is no danger of us being corralled
into some French adventure, or vice versa. We would have the capability
to do things together, as we have done in the Balkans, for instance,
and that would all be to the good. Some people wrote that this
was the end of the British armed forces being independent. That
was completely ridiculous. It is does not affect the independence
of the British armed forces at all. It enhances our sovereign
capability. It means that we can have more A400Ms, we can have
better equipped tanker aircraft, we can have more effective armoured
vehiclesthat is what we can get out of thisand we
can save money on nuclear research, all of which we can put back
into defence for more effect. It certainly doesn't mean that we
will suddenly be careering off around the world because the Elysée
soof course not.
Q102 Richard Ottaway: As you
have just said, you are off to Lisbon tomorrow. What do you see
coming out of Lisbon at the moment? Will it be a landmark summit?
The strategic concept process is rather split between those who
want to stick to the old territorial limits and those who want
to see an out-of-area expeditionary capability. On which side
of that debate do we sit?
Mr Cameron: I think that the strategic
conceptlook, in this life that we all lead, you read enough
boring official documents that are completely impenetrablewas
beautifully clear in how it was written. I told its author the
Secretary-General that myself. I think that it is a good vision
for NATO which is about both European defence and about being
able to act collectively for our wider security, as we do in Afghanistan.
I hope that what comes out of the Council is real solidarity over
Afghanistanthat we are making progress, that we must do
this together, that we must fill the training mission, and that
we must go on training up the Afghan army and police. That should
be the pre-eminent conclusion of it.
Chair: We will be turning to that in
Q103 Richard Ottaway: The
strategic defence review places emphasis on the importance of
the World Service. As you know, the responsibility for that is
being transferred to the BBC. The Foreign Secretary will have
the last word on direction, but the editorial content will be
decided by the BBC. How do you think that that will impact on
the opening and closing of services of the World Service?
Mr Cameron: I think, as you say,
that the Foreign Secretary has the determination of where, and
the BBC has editorial control. It seems to me that that is the
right division. I think that this was a good agreement with the
BBC. I think that the BBC should not be immune from the difficult
spending decisions that Government Departments have had to make.
The agreement where it funds part of the World Service and gives
licence fee payers a six-year freeze in the licence fee is a reduction
of its budget over the spending period that is equivalent to what
is happening to the British Library or British Museumfrom
memory, I think it's about 15%. It seems to me that that is quite
a fair agreement for all concerned, and the licence fee payer
benefits by having a freeze in the licence fee for six years.
Q104 Joan Walley: Can I just
ask a supplementary on that? In terms of the importance of the
BBC World Service, and what was said just now about greening governments,
as well as the importance of environmental literacy and there
being an understanding around the planet of the importance of
the environment and sustainable development with respect to global
security, is that something that you intend to pursue and ensure
is taken up in the new arrangements applying to the BBC World
Mr Cameron: Obviously it will
have editorial independence but I think it has been quite effective
in putting forward good thinking on the environment. I'd also
argue that it's a very good role for the British Council. I was
in China recently, and the British Council has a fantastic programme
in Chinese schools trying to encourage children to think about
the environment. Across our soft-power institutionsthe
BBC and the British Council are great examples of thosethat
is a really good example of what they can do.
Q105 Keith Vaz: Prime Minister,
as you know, the creation of the National Security Council was
a recommendation of the Home Affairs Committee in the last Parliament
because of our concern about the co-ordination of counter-terrorism
policy. Can you tell us practically how that works with regard
to a country such as Yemen? We all accept that terrorism does
not have any boundaries and, as you know, a parcel bomb was found
at East Midlands airport that originated in Yemen. Cobra would
deal with the emergency situation. The NSC would meet monthly
to consider strategy, would it not? Presumably you've started
a strategy on Yemen. How would that strategy actually be implemented
to diminish the risks relating to Yemen?
Mr Cameron: The National Security
Council meets every week. The way I want it to workand
it has made good progressis with all the Ministers who
have a role in national security there, so Energy, Business, the
Treasury, the Foreign Office, DFID and the Prime Minister. In
addition, crucially, you have the experts, who include the Chief
of the Defence Staff, the heads of the security services and GCHQ,
and if we're discussing resilience or whatever, you might have
people from DEFRA or the Environment Agency.
The idea is that it meets every week. It normally
has an update on the key prioritiesterrorism; Afghanistanto
make sure that the decision makers are getting the latest information
from the experts. Then, each week, we try and have a discussion
about a particular issue that needs a strategic approach. We have
had very good discussions on Pakistan and Yemen, on looking at
terrorism in Northern Ireland and on other subjects. So, we try
to pick one off each week.
Yemen is a good example. We have a range of
engagement with Yemen. Obviously, we have a big aid budget. We
have a bilateral relationship; I have spoken to President Saleh
and met him myself. We have a relationship in terms of security,
and we're also a leading part of the Friends of Yemen, which we
jointly chair with Saudi Arabia. We try to use all those tools
to make sure that what is happening in Yemen is moving in the
right direction. It's a country with great difficulties, as you
know. There is huge poverty, declining oil resources, a very
challenged economy, massive population growth, and rebels in the
north and in the south. It's very challenged, and it is also a
base now for al-Qaeda in the Arabian Peninsula. What we aim to
do is bring all the tools we have, with regard to our relationship
with Yemen, to try and make sure we're enhancing our national
Sorry, that was a very long answer, but it's
a classic example of where you ought to be trying to think across
Government, rather than just relying on the Foreign Office to
have a good bilateral relationship.
Q106 Keith Vaz: Would you
see the possibility of the head of the NSCobviously you
chair it so you are the head, but your chief civil servantnot
being a civil servant, which would be like in America?
Mr Cameron: Sorry, I missed out
the key person on the National Security Council: the national
security adviser, Peter Ricketts, who was the Permanent Secretary
at the Foreign Office.
Q107 Keith Vaz: But he is
a civil servant. Would you have an American-style national security
figurea Condoleezza Rice-type figure?
Mr Cameron: I certainly wouldn't
rule that out. Peter Ricketts is doing a brilliant job; he's brought
the organisation together very well. One of the reasons I think
he's done it so well is that, having come from the Foreign Office,
he has got the Foreign Office to buy into the whole process, because
this is a much more collective way of making foreign policy as
well. But no, I certainly wouldn't rule out having a different
sort of person in future.
The key thingwhat I'm trying to do with
the whole Government, whether it is discussing the spending round
or foreign policyis to try to have a more collective discussion
at the centre, which the Prime Minister should try and chair,
rather than being the chief executive.
Q108 Miss McIntosh: Prime
Minister, we're very focused on terrorism, but mindful of the
fact that we have just had two hostages released who had been
taken from their yacht off the coast of Somalia, are we doing
enough, both as a country and internationally, to combat the situation
in Somalia that leads to piracy?
Mr Cameron: It's a very good question.
We are trying but, as you can see with the level of piracy and
the level of hostage and kidnap, the world's efforts in the Horn
of Africa and its coastal waters are, at the moment, not as effective
as they should be. I think that the basic problem is Somalia.
You can have many ships patrolling those watersand there
are quite a fewbut while Somalia is a fairly broken and
ungovernable country, it is extremely difficult. There is no easy
answer, but again it's a combination of factors that we need to
bring to bear to try and make some progress.
Q109 Malcolm Bruce: Prime
Minister, you have given us some quite interesting insights into
how the National Security Council is working. I just wonder if
I could probe you on one or two more points. First, has the composition
changed? On 12 May, when it was announced, the Secretary of State
for International Development was identified as a full-time member,
and you have confirmed that that is the case. It was said that
the Secretary of State for Energy and Climate Change would attend
from time to time, yet you've implied that he is now a full member.
Just for clarification, what is the actual composition?
Mr Cameron: I haven't got the
list in front of me, but certainly for the big discussions, for
instance, when we were discussing Harriers, carriers and defence,
I remember specifically that Chris Huhne and Vince Cable were
both there. Energy is a key national security issue. I don't have
the exact membership in front of me. I can let you know, but Andrew
Mitchell is certainly a member.
Q110 Malcolm Bruce: The follow
through from that is, who actually determines the agenda? You
say it meets every week. Obviously, the interest I have in this
particular section is the international development agenda. To
what extent is it driven by foreign policy or defence considerations?
Who sets the agenda?
Mr Cameron: It's driven by national
security concerns, so the agenda is set by me on the advice of
the national security adviser. I think that so far, it has had
quite a lot of discussions that really do impinge on the excellent
work that DFID does, and DFID plays a very important role in it.
We have made some changes to development policy and have focused
it more on to areas where there is a national security concern.
So we are doing more in terms of broken states and more on conflict
prevention. Now, I know that is contentious with some people,
but I think that is important and right, actually.
Q111 Malcolm Bruce: It's not
contentious, but there is concern about what people call the securitisation
of development. We boosted the budget in Afghanistan and we are
doing so in Pakistan as well. I suppose the two questions that
follow are: to what extent do you think the increased development
budget actually improves national security; and how can you reassure
people that it does that in a way that delivers poverty reduction
and development, rather than sustaining defence activities or
other, more conventional security areas?
Mr Cameron: I'll put my cards
on the table. In order to make the argument for a growing DFID
budget at a time of national austerity, I think we need, correctly,
to broaden the argument for the budget. There is a moral argument,
which is that even in a time of difficulty, there are desperately
poor people in other parts of the world who we should be supporting.
That is part of the reason for the DFID budget and that is why
a lot of the money goes to the poorest people in the poorest countries.
But I think we should expand the argument and actually say, quite
clearly, that the DFID budget is also about conflict prevention
and trying to stop upstream things that will cost us even more
money downstream, whether that is mass migration, climate change,
or conflict prevention. Preventing a conflict is always cheaper
than taking part in it.
Also, frankly, we should be clear that the development
budget gives Britain clout and influence in the world. Six months
into the job, I really feel that. When you sit round the table
at the G8 or G20 discussing Haiti, Pakistan or Yemen, often the
modern equivalent of a battleship is the C17 loaded with aid and
the brilliant Oxfam team that is going to go in and help deliver
water or whatever. They are real tools of foreign policy and influence
and heft in the world. We should be quite frank about that, and
not be embarrassed about it.
Q112 Malcolm Bruce: You don't
have to persuade me, Prime Minister, but you may have to persuade
the wider public. The other thing that relates to that on climate
change is that you have talked about mass migration and the extent
to which climate change in poor countries could lead to people
being displaced and therefore migrating even to these shores.
There is a £2.9 billion international climate finance initiative
coming from DFID, DECC and DEFRA. Will that all be classed as
development assistance and will it be targeted specifically at
poor people in poor countries?
Mr Cameron: My understanding is
that there are very strict rules for what qualifies as ODA spending.
We will make sure that we are within those rules. I think there
is a limit put on the amount that can be spent on climate change
and climate change finance, and we will be within those rules
as well. I have just commissioned a bit of work myself to find
out what other countries are spending on climate finance, because
I want to see that others are following the lead that we have
taken. Perhaps I can let you into the secret when I find out the
Q113 Malcolm Bruce: Thank
you for that. Just as a matter of interest, the Permanent Secretary
and her team gave evidence to the Committee indicating that, across
the Government budget, that would amount to about 7.5% of our
overseas development assistance, which is within the range that
the previous Government set as a targetthey said that 10%
should be the upper limit. Your Government have not repeated that
particular guarantee, but do you accept that that is the ballpark
Mr Cameron: My understanding is
that we broadly accept what was previously laid down. We are within
that and should go on doing it. We have to make sure that, even
as we make what I think is a slightly refreshed argument for the
development budget, as I have tried to explain, we keep people's
confidence that this money is actually helping the poorest in
the world. I personally think that conflict and conflict prevention
is one of the most important drivers and one of the best ways
to prevent poverty, so we shouldn't be embarrassed about the change.
Q114 Malcolm Bruce: Thank
you for that. May I move on to Afghanistan, because that is obviously
where a significant increase in the budget has taken place£700
million over the period, which is a 40% increase? Are you in a
position to say how that is going to be spent? Our defence engagement
is in Helmand, but one would presume that our development spending
is not confined to Helmand. Are you able to say how it will be
distributed both within Helmand and across the rest of Afghanistan,
and, indeed, whether there are any particular sectoral priorities?
Mr Cameron: We have been doing
a number of things. One is, as you say, the support directly into
Helmand, where we have built more than 80 km of roads and are
providing clean water. We have also been improving farmers' livelihoods
through the wheat seed distribution centre, which I have visited.
As well as putting money into other parts of Afghanistan, we are
doing some direct Government support to try to build the capacity
of that Government to, for instance, raise their own revenue.
In the end, we have to try to build an Afghanistan that is not
so dependent on foreign aid and support, so we are doing some
direct Government-to-Government support where we are going in
and helping them build the capacity to run an effective Government,
which is challenging. For instance, we are spending £20 million
supporting the Afghan revenue department and, since 2004, tax
revenues have gone from $200 million to almost $1.28 billion.
That is a good example of capacity building at the centre of Government.
Q115 Malcolm Bruce: There
are some quite good success stories in Afghanistan. The poppy
growing has reduced a lot and the commitment on health and education
delivery has improved. What can you do to try to reassure people
that what we are doing in development terms in Afghanistan is
actually working? Before you answer that question, there is obvious
concern about the level of corruption that exists within the system,
and concern that President Karzai's crackdown on corruption is
rather lacking in commitment. That undermines people's confidence.
Is there anything you feel you can do to reassure people that,
first of all, the money is being effective and, secondly, there
is genuine recognition that corruption is the worst way to ensure
that people will have confidence in future delivery?
Mr Cameron: It is extremely difficult.
I think that our aid programmes are seen across the world as being
relatively good at making sure the money gets to the front line,
is not diverted and is not supporting corruption. We have to do
what we can to reassure people about that.
I approach the argument in a slightly different
way; I think we need to explain that the reason for being in Afghanistan
is national security. We are not going to create a perfect country,
we just want an Afghanistan that can take care of its own security
and deny the space to terrorists. That should be our pre-eminent
concern with Afghanistan. The aid and development work we do is
to help build up that country's capacity in all the ways that
you suggest. I think the tiering of it is that national security
is the first part of the answer, and the development picture is
subsidiary to that.
Q116 Malcolm Bruce: A small
final supplementary. I think the distribution of the previous
budget before it was increased was 20% in Helmand and 80% across
Afghanistan. Are you in a position to say whether that proportion
has significantly changed in the increased budget?
Mr Cameron: All that the figures
I have here show is that about 50% of DFID's funding is channelled
through the Government. I don't have the breakdown of the funding
between Helmand and the rest of the country, but I am sure I can
get that for you.
Q117 Richard Ottaway: Prime
Minister, the justification for our still being in Afghanistan
has been, as I understand it, to prevent the return of al-Qaeda.
It is quite important to distinguish between the Taliban, who
are the locals, and al-Qaeda, who are international terrorists.
Are you still getting advice to the effect that al-Qaeda will
return to Afghanistan if we pull the troops out?
Mr Cameron: That is the advice,
yes, because "Taliban" is a term that covers a huge
range of different people. At one end you have tribes who have
been ignored either by the Government, by private security firms
or whatever else, who have taken up arms as insurgents but who
aren't really connected to the Taliban movement. It goes all the
way from that right up to people who still have a link and a strong
association with al-Qaeda, and there are many degrees in between.
Is it the case that if we literally left now,
and Afghanistan was left as a basket-case country with the Taliban
controlling part of it, with all the bad people we know are in
the tribal areas of Pakistan, al-Qaeda could return to Afghanistan
and re-establish a base there? Yes, I think that is the case.
The success we are havingI don't want to overstate itis
that we are having more tactical success on the ground in Helmand.
Because we have an effective strategy, working with the Pakistanis,
of squeezing this problem from both sides, and serious attrition
of al-Qaeda in the tribal areas of Pakistan, is why we are having
some success. If you pull back on either side, either in Pakistan
or in Afghanistan, you create a larger amount of space for al-Qaeda
to exist in. Part of that could be in Afghanistan if we weren't
there. Sorry, that was a very long answer, but I think it is important
to think about it like that.
Q118 Richard Ottaway: The
military tell us that we are achieving success on the ground,
and that should not be surprising because we are right at the
height of the surge. But you are left with the feeling that when
the military start to wind down the Taliban will come back out
of the woodwork and reoccupy ground that the military hold, unless
we can start talking to them and negotiate a peaceful settlement.
That means having talks at a high level. Do you agree that we
should start talking to the Taliban sooner rather than later?
Mr Cameron: I think this is something
for the Afghan Government to take the lead on and determine. The
way I see it is that most counter-insurgencies the world over
and through history have ended through a combination of force
of arms and some sort of political settlement. I spoke to President
Karzai this morning, and he has said that if people who take a
quite fundamentally strong religious viewsouthern Pashtuns
who have become associated with the Talibanput down their
arms; if they sever connections with al-Qaeda; and if they accept
the broad outlines of the Afghan constitution, they can become
part of the future of Afghanistan. So, some combination of military
success and reintegration of low-level Taliban, and some reconciliation
as well, is part of the answer, but it should be led by the Afghans.
Ottaway: But do you think that the Afghans are strong enough
to do that at the moment?
Mr Cameron: I spent four years
as Leader of Opposition going to Afghanistan every year, and what
I have observed that has changed and is positivethere are
lots of things that are not so positiveis that the relationship
between Afghanistan and Pakistan, between President Karzai and
President Zardari, is much better than it was. In a way, that
is very important to making sure that any form of reconciliation
strategy can work.
Q120 Mr Jenkin:
Prime Minister, you hosted a one-day seminar at Chequers soon
after the election. Was that useful?
Mr Cameron: Yes. It goes back
to our strategic thinking debate earlier. I was very keen as a
new Prime Minister, having taken over an existing Afghan strategy,
to tryalthough I agreed with the main tenets of itto
stand back and have a proper think about what we were doing and
how we were doing it, and how we could get to the end point that
we all want, which is an Afghanistan running its own affairs and
our troops back home as quickly as possible. So, I got people
such as Paddy Ashdown, Rory Stewart, and the former taskforce
commander in Helmand General Graeme Lamb. A number of people came,
and it was a good session to try to think about what we were doing
and how best to do it.
Q121 Mr Jenkin:
And that was with a number of people from within Whitehall and
the military and from outside Whitehall and the military, people
who agreed and people who disagreed with the Government's policy.
Mr Cameron: Yes.
Q122 Mr Jenkin: Don't you
think that it is that kind of strategic thinking that needs to
be permanently available to the National Security Council, and
indeed to the Cabinet if the Cabinet is going to effectively lead
Mr Cameron: I do. You don't have
a huge amount of time though. We're involved in an Afghan situation
in which it is critical that this year and next year we make really
good tactical progress on the ground so that people can see we
are safeguarding the population, denying the Taliban space and
making progress with the other things that I talked about. So
there wasn't a lot of time to have a great strategic rethink.
I just wanted to have a stop and check to see how we should be
touching the tiller slightly to alter the strategy. I would say
that since then it's been much more national security focused,
more hard-headed in its approachas I've tried to explainand
a bit more realistic about what's achievable.
Chair: Order. I must let Richard Ottaway
come back in.
Q123 Richard Ottaway: You
were talking about the Afghans being strong enough to deal with
this. To what extent do you think that the United States ought
to be involved here? You know that it is opposed to the reconciliation
process and opening talks. Can you put some influence on it to
make it change its mind?
Mr Cameron: My experience,
such as it is, is that this part of the relationship between Britain
and America works best if you are talking candidly as friends,
as we are, rather than trying to do it too much in a sort of public
forum. The idea that there is some great disagreement between
different countries in the alliance about the combination of military
success and political settlement is not the case, I think.
Ottaway: Do you think that Pakistan's got to be involved in
Mr Cameron: Obviously, the short
answer is yes, because we have to convince Pakistan that it is
in its interests to have a stable Afghanistan as a neighbour,
and we have to convince it, as I think we are doing, that terrorism
in Pakistan is part of the problemnot part of the solutionand
has to be defeated. I think that you can see what the Pakistanis
have done in South Waziristan and the Swat valley. They are really
putting a lot of pressurewe'd like them to put even moreon
the bad guys.
Ottaway: By 2013, it will become pretty clear whether the
policy's working, and obviously we want it to be seen to be working.
If it doesn't work, do we have a plan B?
Mr Cameron: I am a great
believer in giving plan A everything you've got, and I think that
General Petraeus's troop surge and plan has worked well. I have
said what I've said about the vital importance of training up
the Afghan army and police, and the importance of reintegration
and reconciliation. I think that if we do all those things there
is no reason why we shouldn't succeed.
Chair: Finally, James Arbuthnot.
Q126 Mr Arbuthnot: Prime Minister,
can I come back to that plan B? Let's suppose that the targets
that President Karzai has set himself and the targets that we
all want to see achieved are not achieved. Do we nevertheless
withdraw combat troops from Afghanistan, come hell or high water?
Mr Cameron: I am not contemplating
us not having a successful strategy, but I will be as clear as
I possibly can. I said very clearly that I did not want us to
have combat troops or troops in large numbers in Afghanistan by
2015 for a very good reason, which is this. We have been in Afghanistan
since 2001. We have been in Helmand since 2006. Britain, by 2015,
will have played a huge role, made a massive contribution, made
massive sacrifices for a better, safer and stronger Afghanistan,
and I think the British public deserve to know that there is an
end point to thisthere is a point at which we won't be
in a combat role or have large numbers of troops.
That is why I set the deadline of 2015; and
yes, it is a deadline. I think deadlines sometimes help to focus
minds: help to focus the mind of the Afghan Government that we
have to make progress, help to focus the mind of the military
planners to know that this cannot go on for ever. In my judgment,
that's the right approach for the United Kingdom. We are five
years away from that point. We have a huge amount of effort to
give, and we will put our shoulders to the wheel. We are the second
biggest troop contributor; we are making an extraordinary contribution
to that country in all sorts of ways, including aid, as we've
discussed. But I think the British public deserve to know that
there is an end point to all this, it is 2015 and that's clear.
Q127 Mr Arbuthnot: Why do
you take this view in relation to Afghanistan when you didn't
take it in relation to Iraq?
Mr Cameron: I'm in the position
now of taking responsibility for what we are doing in Afghanistan,
and in the end you have to make a judgment, as Prime Minister,
on what strategy you want to set and whether you want to set a
time limit on it, and I've taken the decision that we should.
They are different situations in Iraq and Afghanistan.
I think I've given a pretty clear answer. We've already been in
Helmand for four years. By the time we are not in a combat role
and with much reduced troop levels, it will be more like nine
years. That is a massive contribution to the security of that
country, and I think we should use the fact that we have given
so much, spent so much and lost so much life to encourage others
in NATO and our trusted partners to make sure that, even if they
can't be in a combat role, they are in that training mission,
they are helping that country.
Let me just make one more thing clear. Yes,
of course we won't be in a combat role; we won't have anything
like the troops that we have now. But should Britain go on having
a relationship with Afghanistan where we're helping that country,
helping train its military, helping support its Treasury, helping
build its capacity? Yes. Because I think we learned the lesson
in the past of walking away from Afghanistan. I'm not proposing
that, but I think the British public deserve to know that our
young men will not go on in the situation they are for ever.
Q128 Mr Arbuthnot: So you
said what you said in Canada in order to reassure the British
public. Was there some pressure coming upon you from the British
public to make such a statement?
Mr Cameron: No, it's not that
This is what I feel, having looked at the defence arguments and
the foreign policy arguments and the national security arguments,
and wanting to take the country through what is a difficult timewe
have suffered some great losses in Afghanistanand wanting
to make sure that we can take the country in the most united way
we can through this situation, for our own national good, of what
we're doing in Afghanistan, and to take people with us. I think
that is actually important.
Q129 Mr Arbuthnot: You will
see the twinfold risk that we might be encouraging the Taliban
to think that they can just wait us out, and that we might therefore
be encouraging the local residents of Afghanistan to support the
Taliban rather than us. That's the first risk.
Mr Cameron: Absolutely. Can I
Chair: Let's take the two risks together.
Q130 Mr Arbuthnot: The second risk
is that we leave Afghanistan and leave the job of combat troops
to our allies, which is not, surely, in the British tradition.
Mr Cameron: Okay. Let me try to
answer those as best I can. First, I think that setting a 2015
deadline rather takes the pressure off what I think other Governments
have felt, which is, "I must insist on this many troops out
by that month" or "that many troops out by that month."
That is actually a more dangerous situation to get yourself into,
because this transition we want to see has got to be in respect
of conditions based on the ground, and we mustn't rush it; we've
got to get it right. So I think it's better to set a later, firmer
deadline than to try to set too many individual deadlines before.
Mr Arbuthnot: I like the notion of "conditions
Mr Cameron: This is five years
we are talking, effectivelywell, four years. But it's a
long period of time.
Secondly, on leaving Afghanistan, what I would
say is this. We have over 10,000 troops in Afghanistan. We have
been in the toughest part of the country for the longest period
of time. When you look at the price we've paid and the casualties
that we've taken, I think we can hold our heads up high in NATO
and say that we have played a huge part in trying to get this
country to a better place. I think other NATO members respect
and understand that and I am extraordinarily proud of what our
troops have done. It's been incredibly tough.
What I have tried to do is first of all make
sure that in the mission we are involved in, we have a proper
spread of troops to deliver that mission. That is why I was absolutely
clear we had to come out of Sangin. We were overstretched. As
well as 10,000 UK troops, there were 20,000 US troops. I wanted
to make sure we were covering an appropriate amount of ground
so we could deliver the job and do it properly. We have served
magnificently in Sangin. Incredibly brave people did extraordinary
things in that town. I have been there and seen it for myself.
But I think it was right to make the decision to say, "Let
us focus on Central Helmand, where we have enough troops to do
the job properly, to deliver the effect on the ground," and
that is now happening. I am confident that was absolutely the
right decision that I insisted was taken. That's the first point.
The second point is, it will be a serious amount
of time that we will have been there, and I think we can hold
our heads up high and say we have played our role absolutely to
the full and we can be proud right now of what we have done, irrespective
of what we will continue to do over the next few years.
Mr Arbuthnot: With that I agree.
Q131 Chair: Thank you, Prime
Minister, for the tribute to our troops and for the fact that
you continue to remind us week by week of the names of those who
have given their lives in this still very costly conflict.
Prime Minister, as you know, we want to have
these occasions a little more frequently than your predecessors
did. I hope we can resume discussions about that. Is there anything
you want to add before we conclude these proceedings?
Mr Cameron: On a happier note,
it's a pleasure to be the first Prime Minister to appear in front
of a fully elected Committee of Select Committee Chairs. This
is democracy in action. Also, I am sure everyone would want to
put on record the happy news we announced yesterday in the House
of Commons about the royal wedding. We are looking forward to
that. There is a debate I think we ought to haveobviously,
we do not know the date yetabout whether there ought to
be a bank holiday. If it's in the middle of the week, it will
be a very good idea to have a bank holiday, and even if it's at
the weekendthis is entirely a decision for the royal familyI
think there would be a great temptation to have a bank holiday,
a day of national celebration, to mark what is happening.
Chair: That sounds like a decision. Thank
you, Prime Minister.
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