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Lord Wallace of Saltaire: My Lords, now that the 30-year rule allows us to see what was happening in 1971, is the Minister aware that in that year the then Conservative Foreign Secretary was seriously entertaining the idea of yielding sovereignty to Spain in return for a long leaseback arrangement? Is she further aware that the compromise was floated within the Foreign Office that sovereignty might be offered to the Order of St John of Malta—the Sovereign Military Order of Malta, which was looking around for something to be sovereign over—and that a senior Foreign Office official scribbled in the margin of the document containing the proposal:

Is the Minister also aware that the national chairman of the Young Liberals in 1971 is now the Minister responsible for negotiations with Spain over Gibraltar?

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Baroness Symons of Vernham Dean: Well, my Lords, how very wise he was in 1971. By a lucky coincidence the Minister is now taking the negotiations forward. Interesting as the reflections on events in 1971 are, the fact is that in 1984 it was members of Her Majesty's Official Opposition who set up the Brussels Process under which we have been negotiating. It is important to concentrate on the facts rather than on the myth. The United Kingdom will not end Gibraltar's link with Britain. We would not pave the way for Spanish control of Gibraltar. We would not end the military arrangements that we have on Gibraltar. All these matters have been circulating as myths, and that is not the basis on which Her Majesty's Government have been proceeding.

Lord Howell of Guildford: My Lords, perhaps I may express sympathy for the Minister in regard to the minor injury that she seems to have suffered and wish her a rapid recovery. As to the matter of access to Gibraltar, is it not a fact that the ferries operated up to 1969, and the air links up to 1978? Both were terminated by unilateral action by the Spanish Government. Is not the whole question of access being used as a bargaining tool by Spain in the current, sadly mishandled negotiations—which, far from helping the Brussels Process, are clearly putting the entire system at risk? Would it not be wiser now, and a matter of common sense, to let the negotiations lapse? Should not the Prime Minister tell Mr Aznar that on Monday? If the negotiations are to be restarted, they should include Gibraltar in a proper way. They should ensure that Spain's disregard of its EU obligations to Gibraltar and its lack of respect for Gibraltar's rights under the EU are properly corrected, so that there is a genuine concern for the future of Gibraltar and that it is not settled over the heads of the people of Gibraltar?

Baroness Symons of Vernham Dean: My Lords, nothing will be settled over the heads of the people of Gibraltar, because, as the noble Lord knows full well, any agreement will be put to a referendum of the people of Gibraltar and they will have the final say. Of course it is important that proper links are established back with Gibraltar, but, as the noble Lord knows, as things stand that is not possible, given the rival expectations of the Government of Spain and the people of Gibraltar. That is what we have been trying to sort out, under a process that was established when the noble Lord's party was in office. We must continue to do what we believe to be right and in the interests of the people of Gibraltar, knowing that they will have a full say in the final decision.

I thank the noble Lord very much for his sympathy. It just goes to show that women of a certain age should not jump off garden walls.

Baroness Hooper: My Lords, it is a long time since 1984, when the Brussels Process started. Is not the Spanish Government's ban contrary to the European Union's policy of freedom of the skies? The fact that Gibraltar is involved should be irrelevant.

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Baroness Symons of Vernham Dean: My Lords, as the noble Baroness knows, that is very much the view of the Government. Alas, it is not shared by the Government of Spain. They have a claim for sovereignty over Gibraltar, which we do not recognise, given the terms of the Treaty of Utrecht. It is not possible to over-emphasise the importance of trying to get an airport in Gibraltar, which would serve not only the people of Gibraltar, but the people of the region and would act as a magnet for prosperity in the region. The same is true of establishing a ferry in the region. At this stage it is very attractive for those who oppose what the Government are doing, for reasons that I find hard to understand, to try and pick out separate little items of discussion. We have to look at the package of agreements that will be reached at the end of this painstaking process.

Commonwealth Development Corporation

2.52 p.m.

Baroness Rawlings asked Her Majesty's Government:

    What is their investment policy for the Commonwealth Development Corporation.

The Parliamentary Under-Secretary of State, Foreign and Commonwealth Office (Baroness Amos): My Lords, an investment policy was put in place when CDC became a public limited company in December 1999. This requires that 70 per cent of new investments, measured over a rolling five-year period, must be in poorer developing countries and that each year CDC should aim to make 50 per cent of new investments in sub-Saharan Africa and South Asia. The 70 per cent target has been exceeded in each of the past five years and the 50 per cent target has been exceeded in three out of the past five years.

Baroness Rawlings: My Lords, I thank the Minister for her Answer. While we applaud CDC Capital Partners for its evident business skills, building up to the partial sell-off, does the Minister accept that in the past two years China has had little difficulty attracting inward investment? Can she explain why CDC Capital Partners has now started investing in China?

Baroness Amos: My Lords, the purpose of CDC is to enlarge the resources available through the introduction of private capital in developing countries. We are doing that across a range of countries, including China. The noble Baroness is aware that our 1997 White Paper put the elimination of poverty at the core of our development strategy. That is why we are looking at poverty elimination across the world and investing in those countries where we think that a significant difference can be made.

Lord Shutt of Greetland: My Lords, does the Minister agree that there is a difference between aid and investment? Would she care to comment on the circumstances whereby, in the CDC accounts, the

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assets that it held from the pre-1998 investments, in a difficult investment year, were written down by 10 per cent, but the assets that have been acquired since 1998 have been written down by no less than 31 per cent? In such circumstances, does the Minister believe that the company is getting its investments right?

Baroness Amos: My Lords, we believe that the company is getting its investments right. This is a transition period for CDC. It became a public limited company only in 1999. We are keen to ensure that CDC observes the investment policy that 70 per cent of investments should be in the poorer countries of the world and that there should be an aim of 50 per cent in sub-Saharan Africa and in Asia. We all know that the operating environment in the past year has been extremely difficult for companies across the world.

NHS Pay System

2.56 p.m.

Lord MacKenzie of Culkein asked Her Majesty's Government:

    What is the reason for the delay in reaching agreement on the new National Health Service pay system.

Lord Hunt of Kings Heath: My Lords, final decisions on pay modernisation need to take account of the recent settlement for NHS funding. Considerable progress has been made in developing the new system. We aim to reach agreement as quickly as possible this year.

Lord MacKenzie of Culkein: My Lords, I thank my noble friend the Minister for that encouraging Answer. I am sure that he is aware that negotiations have been going on for a very long time, in response to ideas put forward by UNISON in late 1996. I declare an interest as a nurse and a former general secretary of the Confederation of Health Service Employees. In the 1980s, together with the late Trevor Clay of the Royal College of Nursing, I bore the scars of negotiating and trying to sell the new clinical grading structure.

A noble Lord: Question!

Lord MacKenzie of Culkein: My Lords, as my old sergeant used to say when I anticipated an order, "Wait for it. Wait for it".

Does my noble friend agree that it is important that we do not replicate the mistake that seriously damaged that clinical grading structure, when the Treasury refused to provide sufficient funding to secure the change in flexibility that was negotiated by the NHS management, CoHSE and the RCN? Instead, nurse was set against nurse. Does my noble friend agree that it is necessary that sufficient funding is available on this occasion to secure the completion of these negotiations in Agenda for Change? Does he further

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agree that it is vital that nurses and other health professionals are encouraged and supported if professional barriers are to be brought down as part of the investment and reform so needed by the National Health Service?

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