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Lottery Proceeds: Distribution Policy

Baroness Sharples asked Her Majesty's Government:

The Parliamentary Under-Secretary of State, Scottish Office (The Earl of Lindsay): My right honourable friend the Secretary of State for Scotland is writing today to the Chairmen of the Scottish Lottery distributing bodies to consult them on a change to the policy directions issued to the Scottish Arts Council under Section 26(1) of the National Lottery etc. Act 1993. This would allow an amount of revenue funding to help arts organisations gain long-term financial viability in a way which would not substitute for existing grant in aid.

The programme would aim to help arts organisations consider and in some cases change their objectives and

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the markets within which they operate; inject new creative, technical and managerial skills into the organisations to help them achieve their objectives; provide balance sheet stability; and deliver better value for money.

The consultation will last until 23rd August and we will then consider the responses to the consultation process, with a view to announcing any change to the directions as soon as possible.

MoD Property Disposals

Lord Beaumont of Whitley asked Her Majesty's Government:

    Whether the sale of surplus service married quarters could not be undertaken at least as cost-effectively and with more care for the environment if undertaken by the Defence Estates Organisation (DEO) referred to on 18th June (WA 22) instead of by the private sector or whether they have any reason to be dissatisfied with the record of the DEO.

The Parliamentary Under-Secretary of State, Ministry of Defence (Earl Howe): Under the terms of the sale of the married quarters estate, we shall be able to dispose of surplus properties by simply terminating the relevant underlease at six month's notice. We believe that this mechanism will ensure a much quicker, simpler and more efficient release of surplus quarters in future.

G7 Summit, 27th-29th June

Lord Campbell of Alloway asked Her Majesty's Government:

    What was the outcome of the G7 Summit at Lyon.

The Lord Privy Seal (Viscount Cranborne): My right honourable friend the Prime Minister attended the Lyon Summit on 27th-29th June with my right honourable friend the Foreign Secretary and my right honourable and learned friend the Chancellor of the Exchequer.

The Prime Minister has placed in the Library of the House the communique, the Chairman's statement and other statements and documents issued by the Summit.

The Summit started with a discussion of economic matters among the G7. In President Yeltsin's absence, the Summit was joined by the Russian Prime Minister, Mr. Chernomyrdin, for a discussion of wider international issues. After the formal conclusion of the Summit, a meeting was held with the United Nations Secretary General and the heads of the International Monetary Fund, World Bank and World Trade Organisation to discuss the role of the international institutions, in particular on development.

On the first evening the Summit agreed and issued a Declaration on terrorism, condemning the appalling attack in Dhahran and other recent terrorist outrages. It

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pledged to fight terrorism by all legal means and agreed that the relevant Ministers should meet in Paris in July to discuss further action. My right honourable friend the Home Secretary plans to lead the United Kingdom delegation.

Discussion of the world economy demonstrated the extent to which the UK's economic policy agenda is now shared by all our partners in the G7. Although growth has slowed in some countries since last year, it is picking up again. Unemployment remains higher than many of us would wish, particularly in continental Europe, but the Summit agreed that the way to bring it down was by liberalising labour markets and through other supply side measures. This is reflected in the communique's endorsement of the conclusions of the G7 meeting in Lille earlier this year to discuss employment issues.

Following up initiatives originally launched by the UK, including ideas floated in 1994 in Valetta, the Summit endorsed further steps to offer a number of highly indebted poor countries an exit from the unsustainable debt burdens. The IMF will offer more concessional lending from the Enhanced Structural Adjustment Facility, to be funded primarily by optimising the management of the IMF's own reserves. The World Bank has offered to contribute in the order of 2 billion dollars from its own resources to this initiative. The Summit called on bilateral creditors to improve on the existing Naples Terms, which allow remission of up to 67 per cent. on a country's debts.

In discussion of trade, the Summit reaffirmed its desire for further liberalisation on the agenda for the forthcoming meeting of World Trade Organisation Trade Ministers in Singapore, including new tariff initiatives. Many members made clear to President Clinton their deep concern at recent US legislation of an extraterritorial nature relating to Cuba. Unilateral measures of this kind are a serious threat to an open world trading system.

They discussed a wide range of global and political issues with Prime Minister Chernomyrdin. He briefed them on the prospects for the second round of the Presidential elections in Russia. They welcomed the progress made on nuclear safety and security at the Moscow Summit last April, and urged all countries to examine closely the 40 recommendations on combating transnational organised crime drawn up by their experts following the remit they were given in Halifax.

There was considerable discussion of environmental issues. The Summit agreed that it was essential to maintain the impetus following from Rio and to play a positive role in the UN General Assembly's Special Session on the environment next June.

The pursuing non-proliferation, members affirmed their undertaking to conclude a Comprehensive Test Ban Treaty by the start of the next session of the UN General Assembly. They also called on all states to make every effort to secure a global ban on the proliferation and indiscriminate use of anti-personnel landmines, and welcomed the bans already adopted by some countries, including the UK, on the production, use and export of these weapons.

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A separate declaration was issued on Bosnia and Herzegovina which emphasised that the prime responsibility for implementation of the Dayton Agreement lies with the different communities and their leaders, and underlined the importance of the elections due to take place on 14th September. These should take place on time, in free and fair conditions. The Summit also made clear their insistence that Karadzic step down immediately and permanently from all public functions and take no part in governmental decisions. They reaffirmed the importance of all those indicted by the International War Crimes Tribunal appearing in The Hague for trial. They warned of the costs of non-compliance with Dayton in terms of sanctions and the availability of economic assistance. They also pledged their full support for Carl Bildt, the High Representative, and for efforts to accelerate economic reconstruction in order to encourage co-operation and reconciliation between the different communities.

There was also consensus on the policies necessary to maintain international monetary stability. The Summit endorsed the work done by Finance Ministers. Their report makes clear that the key to stability is not management or fixing of exchange rates but sound domestic economic policies.

In Halifax last year steps were agreed to make the international financial institutions more effective. Many have now been taken and the Summit welcomed the enhancement of the IMF's surveillance capacities and the agreement to increase the resources currently available to it under the General Arrangement to Borrow.

The Summit recognised, however, the need to improve the co-operation between regulators of

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financial markets in the light of growth in the volume and speed of transactions. They agreed to study in more detail UK ideas for "lead regulators" of internationally active financial institutions. Officials will meet soon to discuss detailed proposals and Finance Ministers will report back to the Denver Summit. They also agreed to co-operate more closely in combating financial crime.

They also reviewed progress in reforming the UN. Significant steps had been taken: 1,000 jobs have been cut, with high level posts reduced by 23 per cent.; there were 25 per cent. fewer staff than 10 years ago; and the 1996-97 budget incorporated a 10 per cent. cut in real terms. But much remains to be done and they agreed to review the situation at next year's Summit. In particular a rationalisation of the UN's role in development is necessary to avoid duplication and overlap between its various agencies.

Under President Chirac's theme of 'globalisation', and with valuable contributions from the heads of the IMF, World Bank and UN, the Summit looked at the problems of poorer countries and how they could best be helped. In particular, they focused on the countries of sub-Saharan Africa.

They agreed that in the long run no amount of aid would help unless these countries were willing to help themselves. Aid nevertheless has a crucial role to play, as long as it is effective. It must therefore continue to be conditional on sensible adjustment policies and good government. In particular, they agreed that bilateral donors should reinforce the international financial institutions' efforts to discourage unproductive expenditure by modifying their own aid and export credit policies. Aid should also be targeted at the poorest and focused on basic human needs such as health and education.

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