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Baroness Scotland of Asthal: My Lords, I do understand. I wish that noble Lords would not run away on certain premises which are false. We have not been asked as yet for use of any of the facilities which

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the noble Lord described. If and when a request is made by our US allies, we will consider it and make a judicious judgment. That date has not yet arrived.

Baroness Rawlings: My Lords, is the Minister aware that the US Secretary of Defense, Donald Rumsfeld, told a conference held in Munich on 3rd February that America had a moral duty to press forward with the programme and wanted to discuss how to help the European nations and other allies to deploy missile defences? Does the Minister believe that it would be better for this country to be brought under the protection of a Russian missile defence system rather than a US-led NATO one? Does the Minister not agree that to work with the US rather than against it is the best way to proceed?

Baroness Scotland of Asthal: My Lords, perhaps I may say this, it is to be hoped, clearly and for the last time. We will work energetically with our oldest allies, the United States. This is an issue which we have been working on for quite some time. Noble Lords opposite should be left in no doubt that we understand the ambit of this issue and we will work with energy with all our allies. We are comforted by the fact that America and Russia are talking together about the self same issue.

Agrimonetary Compensation

3 p.m.

Lord Kimball asked Her Majesty's Government:

    Why the available agrimoney has not been claimed in full in the United Kingdom.

The Minister of State, Ministry of Agriculture, Fisheries and Food (Baroness Hayman): My Lords, the Government are providing 629 million of agrimonetary compensation, of which 233 million is optional, in recognition of the pressures faced by the agricultural industry. Agrimonetary compensation is partly compulsory and partly optional. Because much of the cost falls to the British taxpayer, either directly or indirectly through the Fontainebleau abatement, decisions on whether to pay the optional elements must be taken in the context of priorities for agriculture and other expenditure.

Lord Kimball: My Lords, I thank the Minister for that Answer. I ask the noble Baroness: why not, bearing in mind that the amount of money will run out in the course of the next two months and the incoming government will find it even more difficult, because if the full amount is not claimed this year the amount reduces next year?

Baroness Hayman: My Lords, I understand the point that the noble Lord makes. However, our policy remains what it has been in the past. On every occasion when agrimonetary compensation has become available, we have looked carefully at the state of the industry and the prospects of the sectors concerned, as

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well as at other calls on the UK exchequer. We shall examine the optional compensation, the details of which we shall learn at the end of this month, on the same basis.

Lord Tomlinson: My Lords, does my noble friend agree that essentially the impact of the Fontainebleau mechanism to which she referred in her Answer is that the UK remains responsible for paying the whole of it by virtue of lost income to the Chancellor of the Exchequer? In those circumstances, nowadays is it not perhaps much more effective to concentrate on fundamental reform of the common agricultural policy, which will certainly be necessary if British farmers are to survive in an enlarged European Union?

Baroness Hayman: My Lords, I have a great deal of sympathy with the point that my noble friend makes. It is wrong to represent agrimonetary compensation, as sometimes happens, as some kind of free good from Europe. Because of the rebate, the payment of only the EU contribution costs UK taxpayers about 71p for every pound spent, and when it involves matched funding the figure rises to 85p in the pound. As I said in response to the noble Lord, Lord Kimball, that is the reason why we have to look at whether the money is best directed at sustaining people in what are admittedly very difficult circumstances or trying to support them in the restructuring of agriculture for sustainable incomes in future.

Baroness Williams of Crosby: My Lords, can the Minister say whether there is any real conflict between the two? The Minister is well aware of the tremendous damage done to agriculture as a result of the difference between the high value of sterling and the cheaper euro, in addition to the BSE crisis and several others. Does the Minister agree that it is wise for the Treasury to match the funds available under the agrimonetary compensation scheme? Does she recognise that there is a very strong case for adding the problems of the agricultural industry to the five criteria which the Chancellor will consider in giving advice on whether or not this country should enter the euro-zone?

Baroness Hayman: My Lords, the criteria which the Chancellor will consider have been made absolutely clear in the past, and I am not sure that it would be of assistance to add to that at this stage. However, the noble Baroness makes the important point that the difference in the value of currencies has been one of the main difficulties faced by the agricultural industry. That is why 629 million in agrimonetary compensation has been drawn down in sectors like cereals, which may surprise people. However, this is public expenditure, and we must look not only at short-term support but also at the issue to which my noble friend referred--reform of the CAP--as well as at transfer into the rural development budget.

The Countess of Mar: My Lords, can the Minister say whether the ewe premium comes into agrimonetary compensation? Does it come directly

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from Brussels or does the Treasury have some part to play in it? If it is the former, can the Minister confirm that last year the Ministry overestimated the British sheep flock by 1 million, which represents a considerable loss? I have worked out that the loss to British farmers is about 50p per ewe.

Baroness Hayman: My Lords, I am not sure about the difficulties which may arise in terms of estimates of the national flock, and on that point I shall write to the noble Countess. The sheep annual premium is the difference between a Community-wide target price and average sheep prices on the Community market. If market prices are high, the SAP rate is low. Market prices in member states are reported to the Commission in national currencies. The Commission converts them into euros using current market rates. If the euro is weak, the conversion will provide higher euro rates nearer the target price, thus producing a lower rate of premium. I understand that the Commission is concerned about how the calculation is working currently and is looking at proposals which potentially make it slightly simpler.

Lord Boardman: My Lords, I declare an interest as a farmer. Does not the effect of the Minister's reply mean that the agricultural community is being deprived of funds from Europe to which it is entitled and which it desperately needs?

Baroness Hayman: My Lords, I have tried to make clear in my responses that we are not being deprived of funds from Europe. All the mandatory agrimonetary compensation is, by definition, mandatory and is drawn down. Decisions about optional agrimonetary compensation are taken by every eligible country on the basis of national circumstances. In this country the national circumstances are such that, because of Fontainebleau, compensation involves large amounts of UK rather than EU expenditure. Therefore, questions about the proper disposition of public expenditure come into the equation.

Lord Dubs: My Lords, does my noble friend agree that for British farmers the best way forward would be a substantial reform of the CAP, as her right honourable friend Mr Nick Brown endeavoured to bring about during the Agenda 2000 discussions in Brussels? Does my noble friend agree that reform of the CAP would help British farmers and in achieving European Union accessions?

Baroness Hayman: Yes, my Lords.


3.7 p.m.

The Minister of State, Ministry of Defence (Baroness Symons of Vernham Dean): My Lords, with the leave of the House I should like to make a Statement about coalition operations to enforce the no-fly zones over Iraq. Since the end of the Gulf conflict in 1991, the goal

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of our policy has been to contain the threat to regional security posed by Saddam Hussein's Iraq. This policy has been successful. Without our efforts, Saddam would have been free to maintain and develop his weapons of mass destruction and military capability, and he would have been free to bully and threaten his neighbours with impunity as he did in the past. As we approach the anniversary of the liberation of Kuwait, we can look back with satisfaction that these aims have been achieved.

As your Lordships will be aware, coalition patrols of the no-fly zones have been conducted since the early 1990s in support of UN Security Council Resolution 688, which demanded an end to Saddam Hussein's repression of his own people. They have served a vital humanitarian purpose over the past decade in limiting Saddam's ability brutally to repress the Shias and the Kurds. Without them Saddam would be free, as he was prior to their establishment, to use aircraft and helicopter gunships to further his barbarous ends. The patrols are justified in international law as a legitimate response to prevent a grave humanitarian crisis.

Since January 1999 Saddam's air defence units have mounted sustained and concerted efforts to shoot down coalition aircraft conducting this legitimate task. Over that period there have been over 1,200 attempts to shoot them down, using surface-to-air missiles and anti-aircraft artillery. Coalition aircraft have rightly been authorised to respond to this aggression in self-defence, and have done so on some 250 occasions over the past two years. They do so entirely within the constraints of international law, attacking only those military facilities that contribute, as part of the Iraqi integrated air defence system, to the threat to coalition aircraft. All targets are carefully selected with a view to minimising and, if possible, avoiding civilian casualties.

Military commanders have been able to manage this risk, with 2000 seeing a reduction in the number of threats compared with 1999. Over the past few weeks, however, the Iraqis have redoubled their efforts which amount to a qualitative and quantitative increase in the threat to coalition aircraft. January saw more surface-to-air missile firings than were effected in the whole of 2000. We have seen the Iraqis using innovative tactics, including the use of radars and command centres located outside the southern zone to cue offensive systems, linked by a new secure communications network, within it. The threat is real: Saddam Hussein is trying to kill our aircrew.

Friday evening's action was planned and carried out against that background. It was a proportionate response in self-defence, taken solely in order to reduce the risk to our aircrew carrying out routine patrols of the southern no-fly zone. As such, it was entirely in keeping with all such operations conducted over the period since January 1999 when Iraq started challenging our patrols.

The operation was carefully planned and cleared by Ministers on both sides of the Atlantic. Targets were carefully selected and precision guided weapons used to minimise and, if at all possible, avoid the risk of civilian

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casualties. In all, six sites were engaged, comprising elements of the Iraqi integrated air defence system, including radar, command and communications sites. Five of the targets were north of the zone, ranging up to no closer than 10 miles from Baghdad. All were directly involved in threatening coalition aircraft. Aircraft conducting patrols of the northern no-fly zone have previously engaged targets south of the 36th parallel, but this is the first time that coalition aircraft have attacked targets outside the southern no-fly zone--above the 33rd parallel--since Operation Desert Fox.

RAF participation included four Tornado GR1 strike aircraft, two Tornado F3 air defence aircraft and two VC10 tankers. All aircraft returned safely. Although detailed battle damage assessment is still ongoing, initial reports are that our attack was successful with weapons impacting on or very close to the targets. We are confident that the mission degraded the Iraqi air defence system and reduced the threat to coalition pilots.

We cannot confirm Iraqi allegations of civilian casualties. No military action is without risk, and we deeply regret any casualties. But we learnt long ago to distrust Saddam Hussein's claims. He routinely claims that there were civilian casualties on days when coalition aircraft have not released weapons; and we know that on occasions he has alleged civilian casualties when only military personnel have been injured. We suspect that to be the case on this occasion.

The operation was conducted in response to an escalation on the part of the Iraqis. It does not represent a change in policy. RAF aircrew undertake a difficult and dangerous mission with great skill and fortitude. Faced with a substantial increase in the threat to them in recent weeks, we had no choice but to act to protect our people. All this could stop now if Saddam stopped trying to kill our aircrew.

3.13 p.m.

Lord Burnham: My Lords, the House is very grateful to the Minister for the Statement. However, the Minister rose to speak at seven minutes past three. We received the Statement at 2.41 p.m. That really--I suspect I speak too for the spokesman from the Liberal Democrat Benches--has not given us sufficient time to make a reasoned response. I must ask that in future more consideration is given to the Opposition parties.

Having said that, on these Benches we believe that the action was fully justified. Ten years on from the Gulf War Saddam Hussein is still a source of aggression in the Gulf. The need for the Government to develop a resolute policy is as strong as ever. The no-fly zones were essentially the invention of my right honourable colleague John Major. It is appropriate that from these Benches we should support fully the current policy.

The Minister made it clear that Friday's air strikes were against military targets, including radar and command and control sites, around Baghdad. The attacks were aimed at defence installations which threatened allied warplanes in one of the no-fly zones.

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President Bush stressed that it was a "routine" enforcement of the no-fly zones. If the no-fly zones are to be supported, the need to use our air power pre-emptively from time to time against Iraq's anti-aircraft missile system is an inevitable consequence of our continuing to enforce the no-fly zones.

The Minister made the point that the no-fly zones are the inevitable consequence of Saddam Hussein's continued persecution of his minorities--the Kurds in the north and the marsh Arabs in the south. Our patrols have successfully prevented Saddam Hussein from using his helicopter gunships and using air-delivered chemical weapons to wage war against these minorities, which he did previously. The Iraqis cannot be allowed to do that with impunity. They have been playing a game of cat and mouse with our jets, and have tested the scope of the no-fly zone.

The Minister stated the major increase in surface-to-air missile figures for the month of January. Even if these missiles are not fired, it is not possible for an aircraft, or any of its systems, to decide whether the radar or system facing it is actually loaded and is intended to be fired. It is right that we should do all we can to ensure that the threat to our airmen flying patrols over Iraq is reduced as far as possible. For years Saddam Hussein has built up his weapons of mass destruction, including biological weapons. He has increased their range. He has possibly even come near to the possession of nuclear devices. He poses a serious and growing threat, both to the region and to Europe.

I have some questions. First, what happens now? Does this presage the tightening of sanctions against Iraq? What is the attitude to the regime and to the ballistic missiles? We note that when push comes to shove it is the United States and Britain who stand up and actually act to protect the minorities and the countries which are affected by dictator-run regimes like Iraq. We have had no response from Germany, and, with the response we have had from France it is clear that the other countries are not so resolute in their determination to act in the way that we have done.

I have one further point. If matters get worse--Saddam Hussein has been threatening retaliation as a result of these strikes--will the United States and this country and other countries be able to act as they did in 1991? Will they be able to produce the firepower and the activities that will once and for all ensure that Saddam Hussein is unable to behave in the same manner as he has for the past 11 years?

3.19 p.m.

Lord Wallace of Saltaire: My Lords, we on the Liberal Democrat Benches support the action which has been taken within the limited context in which it has been taken. Clearly, any action which lessens the danger to British pilots and aircraft is necessary. We have no illusions about the nature of Saddam Hussein's regime. However, we are concerned about the long-term context in which this action has taken

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place and about the dangers of continuing with an action for which the strategic rationale appears less and less convincing.

We are also concerned about the wider Middle East context of the action taken against Iraq against the background of the most serious situation in the Arab-Israeli conflict that we have seen for some years. Anything which contributes to increasing Saddam Hussein's popularity among Arab radicals in the current circumstances should not be done lightly.

We are also somewhat concerned about the overuse of the term "humanitarian intervention". We have already heard in other contexts from the Russians that humanitarian intervention seems to them to be being used by the United States as an all-purpose justification for unilateral intervention in defence of western interests as defined by the United States. We see this as containment, as the Statement says at one point, but the humanitarian elements seem to us less clear than they were 10 years ago, given that the United Kingdom is not committed to the division of Iraq and that the prospects for a change of regime are rather less optimistic than they were.

There are reports in the newspapers that there are to be talks on 26th February between the United Nations and Iraq on the inspection regime. I note that the Egyptian Foreign Minister, Mr Amr Moussa, is quoted in one of today's newspapers as saying that this action could seriously undermine those talks. I note that the non-White Paper, The Future Strategic Context for Defence, states on page 17 that the UK has an important role to play in preventing misunderstanding between the United States and European partners. How are we playing that role at the present moment and what plans do we have to consult with our allies in the EU as well as the with the US? What plans are there for the British Government to reconsider the long-term guidelines for the containment policy?

3.23 p.m.

Baroness Symons of Vernham Dean: My Lords, I thank the noble Lords, Lord Burnham and Lord Wallace of Saltaire, for the support they have offered Her Majesty's Government in the action that has been taken in reinforcing our position in the no-fly zones. I am sorry that the noble Lord, Lord Burnham, was disappointed by the short notice he had in receiving the Statement. I asked for the Statement to be somewhat fuller than it was in its original form. I believe that in so doing, although there may have been some slight delay, I was able to present more information to your Lordships as a result. It is always a difficult issue trying to balance both the time given to Opposition parties, which I recognise is very important, and trying to get as much information into a Statement as possible.

The noble Lord, Lord Burnham, is quite right that the no-fly zones were established under the previous Prime Minister, the right honourable Mr Major, and of course we have continued to support those no-fly zones throughout the lifetime of this Government.

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Indeed, when the Iraqis started to attack the coalition aircraft, that did not deter us in any way. I am grateful to both noble Lords for recognising that.

The noble Lord, Lord Burnham, described the Friday night air strikes as pre-emptive. But actually they were a response to the increased activities of the Iraqis. I wish to make it clear to the House that this could all stop if only the Iraqis would stop trying to shoot down coalition aircraft. I remind the House that in January this year there were more attacks than we saw in the whole of last year. To have more attacks in a single month than in the whole of last year represented a significant increase.

It is important for us to remember why the no-fly zones were established. The noble Lord, Lord Wallace of Saltaire, was concerned about what he described as the overuse of the word "humanitarian". The noble Lord does not need to be reminded of the appalling atrocities that were carried out against Halabja in the north no-fly zone, when more than 5,000 civilians were murdered by the activities of Saddam Hussein's forces. The Shias and the marsh Arabs in the southern no-fly zone suffered appalling attacks as a result of the activities of Saddam's helicopter gunships. I believe that the no-fly zones and their protection are at the heart of what we are talking about.

Both noble Lords asked what will happen now. We believe that we have taken out some of the offensive capacity. As I hope the Statement made clear, we are still assessing just how much of that offensive capacity we have been able to deal with. That will be important if it means that there are fewer attacks on coalition aircrew as a result. However, the basic policy remains the same--the pursuit of UNSCR 1284, a resolution that was supported in the United Nations not only by the coalition but also by the Arab nations.

The noble Lord, Lord Burnham, asked what will happen if the situation gets worse. If it gets worse, that will have to be assessed against the threat as it evolves. It is difficult to answer that question hypothetically, but, as all of us will be aware, it is an issue which demands constant vigilance, as indeed it has, from the coalition forces. We did not go into this action lightly. Of course the issues around the delicacy of the Middle East peace process have been considered very fully, but I am glad not to be having to stand before the House today to present noble Lords with a Statement about our aircrew having been shot down. The House must recognise that that was the possible alternative if we had done nothing to try to take out these installations.

We all recognise that Saddam Hussein has never wasted an opportunity to present himself as a champion of the Arab cause. Those of us who know the Gulf states and the Middle East will realise how deeply embarrassing many of his Arab neighbours find his self-portrayal in that way.

The humanitarian basis of establishing the no-fly zones is at the heart of what has been going on here. Of course we should like to see the inspections resumed. That is clear in UNSCR 1284. And of course the noble Lord, Lord Wallace of Saltaire, is entirely right.

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Consultations on this matter should not be just across the Atlantic; we also have to consult closely with our allies in Europe and elsewhere. We have to put before them the incontrovertible evidence that we have about the way in which Saddam Hussein has been building up his military capability to try to shoot down coalition aircraft. That is why this action was so necessary.

3.29 p.m.

Lord Shore of Stepney: My Lords, I thank my noble friend for making the Statement and assure her that as long as we have no-fly zones none of us will seriously object to making certain that our aircraft are properly protected or are able to protect themselves. However, is not the problem that the relevance of the no-fly zones to our real purposes in dealing with Iraq is not now as clear as it was?

As my noble friend reminded us, Saddam Hussein remains a major threat to stability in the whole area. I should like to think that weapons of mass destruction are not again being, as it were, recreated in Iraq. But what can we do about getting the UN inspectorate back into that country in order to make certain that Saddam Hussein has not been able--we know how near he was--to manufacture nuclear weapons and other weapons of mass destruction?

Furthermore, how do we propose to react to his reiterated public threat made only a week or two ago to the independence of Kuwait? While I do not object to our actions, what we are dealing with here is only one symptom of the major problem.

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