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4.39 pm
Baroness Symons of Vernham Dean: My Lords, my noble friend has expressed his gratitude to the British forces trying to help those British citizens who want to leave Beirut and Lebanon to do so. I hope he will be able also to express our gratitude to Her Majesty’s Ambassador in Beirut, James Watt, who, together with his very able staff, is struggling in difficult circumstances. I hope we can offer the diplomats there our support.
My noble friend mentioned the role of Egypt in the repeated Statement. He said that the British Government supported the mediation of Egypt between Israel, the Palestinian Authority and the militias holding Corporal Shalit. He went on to say that the British Government offered assistance. Will the Minister clarify that? He stated the view that it is not possible to talk directly with Hamas, but supported those who are doing so through this mediation process, and has offered further support from the British Government. Does that mean that there has been some modification to the British Government’s view on talking to Hamas, and, if so, would the same mediation be supported for the two Israeli soldiers held in Lebanon, who are widely believed to be held by Hezbollah? Many of us believe that it is not possible to have a successful resolution of this potentially appalling situation in the Middle East unless some talks go on with those who have hitherto been earmarked as beyond the pale for such discussions.
Lord Triesman: My Lords, I am very grateful to my noble friend Lady Symons for her congratulations, which I will readily convey to James Watt. I have spoken to him, as noble Lords can imagine. He and
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On who is talking to whom, I do not think that there is a modification of view. The Government’s position remains that we do not seek to talk to organisations that have espoused terrorism and argued that Israel should be wiped off the face of the map. That is their position, which is why we will not talk to them. They can remedy that very easily, and should do so. It is obviously important through intermediaries to try to find ways of getting some sort of discussion going. It is likely that intermediaries will have a greater impact on them than we might, particularly the Egyptian Government, who seem to have those links. I say cautiously, because I say it out of partial ignorance, that I do not think they have the same links with Hezbollah as they do with Hamas, but, none the less, there are those who do. The organisation should release all the Israeli soldiers it holds. It should desist from violence and the Israelis should act proportionately.
Baroness D'Souza: My Lords, if the conflict escalates to the point where an attack on Iran is considered possible or even likely, what will be the British Government’s attitude?
Lord Triesman: My Lords, no attack on Iran is contemplated.
Lord Dykes: My Lords, does the Minister agree that it was disappointing that, because of American unwillingness, the G8 summit did not respond to the French proposal for a simultaneous ceasefire on all sides?
Lord Triesman: My Lords, I understand—I was not in St Petersburg—that a number of ideas were canvassed and a good deal of creative work was done before the final statement was produced. Those ideas were thought through by the Sherpa teams working in the background for the G8 leaders. The G8 statement was not just endorsed by the leaders, but endorsed with some enthusiasm. None of them felt that they had been knocked back or set back and it is worth noting that in their own press statements they expressed some enthusiasm for it.
One of the key reasons for that enthusiasm is that as regards Lebanon and Gaza it is possible to see in the statement specific requirements expressed by G8 leaders, which, in my view, touch all the bases needed to stabilise the position. I will not go through them all because of time and other questions that noble Lords may wish to ask, but I strongly recommend that noble Lords look at the set of requirements that the G8 as the leading economies in the world placed on all the parties. I believe that noble Lords will see that the requirements are as strict and as stringent on both sides of the dispute as they should be in these circumstances.
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Lord Clinton-Davis: My Lords, does my noble friend agree that food, fuel, natural gas, medicines and electricity generators have passed from Israel to Gaza in recent days? Does he further agree that although evacuation from Lebanon has been mentioned, there should equally be evacuation plans—possibly not carried out immediately—of British nationals from Israel?
Lord Triesman: My Lords, some equipment, some food and some medicines have gone through. I heard an estimate of the number of lorries that have passed through Israel and into Gaza, but I do not want to speculate on the number because I am not 100 per cent certain how reliable it is. The situation in Gaza plainly requires much more food, medicines and materials. There are not enough. Unquestionably, there is a humanitarian problem of major dimensions in Gaza. Without anyone pointing fingers, I state that many civilians are under the kind of pressure that most of us would regard as intolerable. This morning, I was able to meet with Jan Egeland, the United Nations commissioner responsible for humanitarian issues. I am quite satisfied in my mind that the problems go well beyond the materials that have been delivered so far—although materials have been delivered.
Finally, I turn quickly to evacuation. At the moment, there has been no call for evacuation from Israel. We have evacuated a small number of British nationals across the northern border into Syria and we are bolstering our consular team in Syria on the grounds that we may have a need, not necessarily to evacuate people, but at least to assist them on their way home.
Lord Phillips of Sudbury: My Lords, does the noble Lord accept that the continuing colonisation of the West Bank, so that there are now nearly half a million Israelis living there—a colonisation that goes on month by month and year by year in complete disregard of the road map requirements—is a provocation for the Palestinians so intense that, frankly, one cannot be surprised that there was an increase in rocket firing from Gaza and the West Bank? Please will the Government accept that, unless something is done to stop building in the West Bank, which now is proposed virtually to encircle east Jerusalem, the last foothold of the Palestinians in Jerusalem, everything else is hot air and evasion?
As all of us are desperate for Israel to live behind secure borders, the Palestinians to live in a state of their own and the Middle East to cease to be the infection of the world's political bloodstream, I urge the Government to get beyond hand-wringing and, frankly, soft words and, if necessary, to break with the United States because, at present, the United States shows not the slightest inclination to accept that fundamental reality.
Lord Triesman: My Lords, I can hardly think of a prescription more likely to cause devastation to any prospects of peace than the quartet breaking up. It represents one of the most serious, united international forces to try to ensure that some form of negotiation
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I have a good deal more sympathy with the points made about the West Bank. I would not use the words that have been used, but it is true that some of the building in the West Bank, certainly in those parts east of Jerusalem that would make a contiguous and viable Palestinian state entirely impossible, is contrary to international law, as is the route of the wall. I have said so from this Dispatch Box, to Israelis in the Israeli Government and to their diplomatic representatives, and I repeat it, if it needs to be repeated, here today. I do not know what is meant by “something should be done to stop building east of Jerusalem”, short of detailed persuasion and key arguments being deployed about the future of peace and the two-state solution, to which we remain 100 per cent committed. I do not know what else is being contemplated.
All the key forces, including the United States, must be brought to bear to secure a return to the road-map negotiations. Anyone, at the UN or elsewhere, who is not disposed to violence as the first tool for dealing with this, believes that those negotiations are the only route to securing a peaceful settlement.
Lord Foulkes of Cumnock: My Lords, does my noble friend agree that, given the extremely dangerous situation and the danger of escalation, it does no good whatever to join in the blame game, as we have just heard, either of Israel or, as I would prefer, of Iran and Syria for financially supporting Hezbollah? I expressed my concern to the Iranian Foreign Minister at the weekend. It does not help to have the kind of academic discussions about the general situation that we have heard from some quarters. The G8 is now supporting the potentially viable solution of a ceasefire and an international stability force. What are the Government doing to get the support of other countries—we have the support of the Americans—and from other parties in this country for that solution, which is the only one for dealing with the immediate problem?
Lord Triesman: My Lords, I hope that, broadly speaking, people across the political spectrum in the United Kingdom believe in the two-state solution and the viability of both states as an international outcome. I wholly agree with my noble friend that the blame game is seldom profitable and that, at a time like this, it is most likely to be disruptive. I can see very little merit in it. We need stability, underpinned by an international force if necessary—you cannot simply intercede between warring parties. I understand that Javier Solana and the Secretary-General of the UN are discussing what kind of force that may be. Such a force may greatly encourage the parties to cease shooting at each other if it is believed to be capable of stopping rocket fire in one direction and the bombings in the other direction, in which case it would be well worth having such a disposition on
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Lord Roberts of Llandudno: My Lords, there are a number of Christian and other groups in Israel and Palestine at the moment. What is the advice to them, and can that advice be given to the thousands of people who are planning in the next month or so to be on pilgrimage or other holiday business in Israel?
Lord Triesman: My Lords, as the Minister responsible for consular matters, my advice to everyone, whether they are Christian, Islamic or Jewish visitors, is to behave with the greatest caution and to read the travel advice, which, as people can understand, is changing more or less day by day right across the region. We believe that most places in Israel are relatively—I repeat, relatively—safe, but that is changing all the time. I do not want anything that I have said today to be taken to be advice for people over the next couple of months. That would be foolish, and I will not do that. Our advice in respect of Lebanon is also extremely important. There are now more or less no secure places and no clear routes in or out of the country, although of course we are trying to establish routes out.
Lord Anderson of Swansea: My Lords, does my noble friend agree that there are clear points of leverage in respect of Hamas—be it Egypt or the European Union—but it is difficult to find equivalent points of leverage in respect of Hezbollah, which, it is asserted, has been preparing for this for six months or so? Hezbollah is well supplied with sophisticated weaponry and the countries that lean on it—Syria and Iran—have every interest in maintaining the problem. Where does my noble friend see any areas in which pressure could be applied on Hezbollah for restraint?
Lord Triesman: My Lords, I entirely accept my noble friend’s point that it is easier to identify where there might be some influence on Hamas; it is not easy to see where the influences on Hezbollah are other than among those who would prefer it to continue to fight than not. However, we are trying hard to persuade even those countries that their best interests and security will also, in the long term, be better provided for if they try to assist in ending the violence of Hezbollah across from Lebanon and into Israel.
The Lebanese Government are entitled to survive. One of the great difficulties in this phase of events is the risk to the Lebanese Government, who have, as a result of United Nations decisions—resolution 1559, in particular—had a responsibility to disarm Hezbollah. The other countries in the region, in as much as they have any regard for the survival of the Lebanese Government, should be assisting in that project.
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Lord Hannay of Chiswick: My Lords, the Minister has mentioned the possibility of a UN monitoring capability. Does he recognise that the UN’s experience in the Lebanon up to now has been fairly disastrous? UNIFIL has been there for many years in large numbers and quite a lot of people have been killed in the process. It has not managed to achieve very much because it has not had the backing of the international community against two forces that have treated it with contempt—the first being Hezbollah and the second being the Government of Israel, both of which have treated UNIFIL with no respect whatever. If UNIFIL, or another UN force, is to be asked to operate in southern Lebanon, will the Government give serious consideration to the sort of backing that will be required from all the major powers with respect to those two forces that have hitherto not respected UNIFIL?
Lord Triesman: My Lords, the simple answer is yes. I do not know whether such a force would be a bolstering of UNIFIL or another force. This is an early phase of what will be a complicated discussion, but there is no doubt that any military presence on the ground would have to respect UNIFIL, or any other force, or that approach could not conceivably work.
Baroness Ludford: My Lords, will the Minister make representations to the Israeli Government to ask them to desist from what I regard to be their unacceptable practice of creating sonic booms across the Palestinian territories? I speak as a member of the Liberal Democrat Friends of Israel, which is very conscious of Israel’s right to take action against threats to its security. I was disappointed because I wrote to the Israeli ambassador in December about this and I have not received a response. I cannot see the military utility of creating sonic booms which are intimidating and harassing the population.
Lord Triesman: My Lords, that is unquestionably a fair point. We are asking that no disproportionate action should take place. Things that cause terror to civilian populations most certainly count in that list.
Lord Monson: The noble Lord, Lord Triesman, rightly declared that the Israeli response to Hezbollah should be proportionate. Can he explain why the Israelis bombed Tripoli, killing a number of people, given that Tripoli is in the north of Lebanon, about as far from the Israeli border as can be imagined? Its population is largely Sunni Muslim, with a small Christian minority, and extremely few Shias who might be supporters of Hezbollah.
Lord Triesman: My Lords, very briefly, I am not party to the thinking of Israeli military strategists, but I understand the point that is being made. For what it is worth, it appears to me that there is an attempt to create a degree of isolation, which probably means that port installations more generally have been hit. We want to see this stopped and a peaceful outcome, and we expect everyone to behave in a way that gives peace a chance.
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Consolidated Fund (Appropriation) (No. 3) Bill
5 pm
Lord McKenzie of Luton: My Lords, I beg to move that this Bill be now read a second time.
Moved, That the Bill be now read a second time.—(Lord McKenzie of Luton.)
On Question, Bill read a second time; Committee negatived.
Then, Standing Order 47 having been dispensed with, Bill read a third time, and passed.
Finance (No. 2) Bill
5.02 pm
Lord McKenzie of Luton: My Lords, I beg to move that this Bill be now read a second time. In addition to covering the substance and main clauses of the Bill, I will address some of the issues raised by the report of the Economic Affairs Committee on the Finance Bill 2006. I also look forward to the maiden speech of the noble Lord, Lord Burnett; this is a good debate in which to start.
Let me first set the scene. In March, my right honourable friend the Chancellor outlined in the Budget the Government’s vision for Britain. The Government believe in a modern and fair tax system which keeps pace with the changing world, encourages work and saving, and ensures that everybody pays their fair share in delivering world-class public services. The long-term decisions taken by the Government—giving independence to the Bank of England, new fiscal rules and a reduction in debt—have created a strong platform of economic stability. The international economy has in recent years been affected by geopolitical uncertainty, rising oil prices, large current-account imbalances and shifting exchange rates between the US, Asia and Europe. Despite this, the UK has low and stable inflation and its economy is experiencing its longest unbroken expansion since quarterly records began, with 55 consecutive quarters of GDP growth. In fact, in the nine years since the Government came to office in 1997, UK GDP growth has risen by around 26 per cent. By contrast, in the nine years to 1997 the economy grew by 15 per cent. Based on internationally recognised measures of economic stability, the UK has moved from being last for stability of inflation among G7 competitors before 1997 to now being described by the OECD as a “paragon of stability”. The IMF has emphasised that the UK’s macroeconomic stability remains remarkable, being supported by,
- “sound policies implemented by strong institutions and underpinned by monetary, fiscal and structural policy frameworks that have increasingly instilled confidence in the authorities’ conduct of macroeconomic policies”.
Alongside that economic record, this Finance Bill delivers measures which enhance productivity, enterprise and competition; help the environment; ensure that the tax system is fair and targeted; tackle
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I should like to say a little about the debate on the perceived complexity in this Bill. These measures are designed to be as simple as possible while protecting revenue, encouraging growth and enterprise, and addressing market failures. Complexity is an issue that the Government take seriously. Tax systems in the modern world are inherently complicated, reflecting the complex economic and social realities in which we live. Recent research carried out by KPMG found that the UK tax system imposes administrative burdens of only around 0.41 per cent of GDP, comparing favourably with other countries. However, HMRC has been set challenging targets to reduce even further this burden. It will reduce the time spent dealing with forms by 10 per cent and with inspections by at least 15 per cent over the next five years. The Government have a strong record of engaging with business and intend to continue this dialogue. Large proportions of the Bill follow extensive consultations with business to ensure that the legislation is modernised to reflect the changing business environment. The—
Lord Forsyth of Drumlean: My Lords, I apologise for interrupting the Minister but could he tell the House what percentage of the clauses and how many of the pages in this 500-page Bill were debated in the House of Commons?
Lord McKenzie of Luton: My Lords, I do not have those data to hand, but, as I can, the noble Lord can look up the record and read the debates. I am sure that he has.
The Bill includes measures responding to those consultations: for example, we are expanding R&D tax credits, establishing a new film tax credit and creating real estate investment trusts. Stability in the tax system is key to economic security and we have undertaken a number of tax reforms to improve productivity, promote sustainable development and tackle market failures in the economy. This Finance Bill contains further measures to support the sustainability of the tax system. It allows business to plan for the long term on the basis of low and stable tax rates.
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