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Lord Renton of Mount Harry: My Lords, I thank the noble Baroness for that reply. Does she agree that the problem at the moment is how to make the Iraqi people partners in their own liberation? Whatever the Department for International Development has done so far, could not much more be done—as the time for humanitarian aid becomes more pressing—to encourage it to work with international agencies in the effort to convince the Iraqi people that post-Saddam peace and reconstruction is possible, but that preferably it should be done under a United Nations flag rather than the Stars and Stripes?

Baroness Crawley: My Lords, I very much agree with the noble Lord, Lord Renton, that it is essential for UN agencies to return to Iraq as soon as possible and that we have a phased development of humanitarian operations there. While it is too soon to go into detail on reconstruction plans for Iraq, it is

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important to draw to the attention of noble Lords the fact that yesterday my right honourable friend the Foreign Secretary made it clear that we shall work with the United Nations and others on the long-term redevelopment and rehabilitation of Iraq. We see that as an extremely important aim.

As the noble Lord, Lord Renton, will know, a couple of weeks ago an agreement was reached in the Azores between the United States and the United Kingdom to seek the urgent adoption of a new United Nations Security Council resolution that would affirm Iraq's territorial integrity, ensure the rapid delivery of humanitarian relief and endorse an appropriate post-conflict administration in Iraq.

Baroness Whitaker: My Lords, I believe that my right honourable friend Clare Short played a very active part in the successful renegotiation of the Oil for Food programme. Can my noble friend tell me how that is now working out in practice?

Baroness Crawley: My Lords, I thank my noble friend for that question. The Oil for Food programme is a massive humanitarian operation. Noble Lords will know that the programme spends 10 billion dollars each year from the proceeds of the sale of Iraqi oil on the essential requirements and necessities of the Iraqi people. I refer not only to food, but also to water and medical supplies. Securing a unanimous United Nations resolution on the Oil for Food programme was a great achievement. As soon as it is safe for the NGOs to go into Iraq and for the UN agencies to return, we want to get the Oil for Food programme up and running again.

Baroness Northover: My Lords, have the aid agencies been able to offer any useful advice on how best to distribute the very limited amount of aid that is currently reaching Iraq, so that it is not simply the strongest who receive it? If such advice has been provided, what recommendations have been made?

Baroness Crawley: My Lords, the noble Baroness will know that the Red Cross and the Red Crescent were extremely active during the early part of the conflict. DfID has been able to offer advice to the MoD and our forces. There are DfID advisers with the United Kingdom forces in Iraq. They are advising on how best to ensure that the most vulnerable members of the population are targeted so that it is not just the strong who receive the aid first. To that end, the Army is working closely with the MoD.

Lord Astor of Hever: My Lords, although it is early days, can the Minister say what contingency plans have been made for the provision of humanitarian aid should there be a lengthy siege of Baghdad?

Baroness Crawley: My Lords, there are a number of contingency plans. Decisions have been made in the past few days on the budget for humanitarian aid. A total DfID budget of 210 million is available for this crisis; a flash appeal has been made by the United

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Nations for 2.2 billion US dollars, to which we have contributed 65 million; and we have provided 30 million-worth of food and supplies, which the MoD is distributing through our forces.

The Lord Bishop of Guildford: My Lords, I rise to speak wearing my hat as chair of Christian Aid. We have a proper concern for the safety of our staff and the staff of our partners in the midst of conflict. Does the Minister accept the position unanimously adopted by the agencies that they can do their work only in complete independence of the military operation? The noble Baroness gave a helpful answer about the importance of the role of the United Nations. Can she confirm that the work of the agencies would be seriously compromised if that were compromised, as would the reputation of the British Government?

Baroness Crawley: My Lords, I agree absolutely with the right reverend Prelate. Our humanitarian strategy is to seek to provide support where there is the greatest need, not where certain occupying forces are.

Lord Chan: My Lords, does the Minister—

Lord Williams of Mostyn: My Lords, I am afraid we are out of time.

European Union: Fraud

2.52 p.m.

Lord Pearson of Rannoch asked Her Majesty's Government:

    Whether adequate progress is being made by the European Union Vice-President for Administration and Reform, Mr Neil Kinnock, and others to eradicate fraud and mismanagement in the European Union.

Lord McIntosh of Haringey: My Lords, since the publication of the reform White Paper in March 2000 there have been a series of major reforms of European Union governance and finance. The latest and most far reaching of these, the new financial regulation, came into force on 1st January this year. A major modernisation of the accounting framework and its supporting IT system is also being carried out. We expect that the bulk of these reforms, including a move to accruals accounting, will be implemented by 2005. This is an ambitious timetable and we strongly congratulate the EU Vice-President on the substantial reform programme that he has put in place.

Lord Pearson of Rannoch: My Lords, I thank the noble Lord for that reply and for doing his best to justify the unjustifiable. Does the noble Lord agree that it is now four years since the Commission resigned in disgrace and that at least five of the senior officials who blew the whistle have been silenced? Although the Minister said that the new accounting system is on the way, my understanding is that it will not be in place until 2006. In the mean time, no normal auditor would

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sign off any of these accounts. In these circumstances, is it not time that Her Majesty's Government stopped pouring so much of our money down such a hopelessly corrupt drain?

Lord McIntosh of Haringey: My Lords, the noble Lord, Lord Pearson, is right in his first and plainly historical point about the amount of time since the Santer Commission resigned. He is wrong about everything else. For example, if he is talking about Mrs Marta Andreasen, she herself has said that she was not a whistle blower and that she was not dismissed for criticising the reforms introduced by Neil Kinnock. The most recent accounts—those for 2000—were granted discharge by the European Parliament in April last year and the final stage of that is fast approaching. No accounts have failed to be given discharge by the European Parliament. As to the European Court of Auditors, it has rejected all of the last eight accounts. But it has done so on a basis which is generally recognised to be outdated—that is, a 5 per cent sample without any systems accounting procedures.

Lord Saatchi: My Lords, why did the EU pay out subsidies in Austria for 60 per cent more alpine pastures than exist? How did it manage to pay 2.5 billion euros to olive oil producers in Greece last year, despite the fact that there is no register of olive oil producers in that country?

Lord McIntosh of Haringey: My Lords, I am disappointed in the noble Lord, Lord Saatchi. He has forgotten about the import of bananas into southern Italy and tobacco subsidies in Greece. The newspapers are full of examples of fraud and irregularities. There is no doubt that there are both irregularities and fraud. Of course there are; there are in all systems. But the Question was about the reform programme—and the reform programme that Neil Kinnock is introducing is quite remarkable. The EU is moving over to accruals accounting, with a proper balance sheet, in a period of only four years. It took us seven years to do that and only three other European Union member states have succeeded in doing so.

Lord Wallace of Saltaire: My Lords, does the Minister agree that we need a strong and effective Commission and that Vice-President Kinnock's work to reform its working and accounting practices is extremely important? Can he assure the House that the British Government have given the fullest possible support to Vice-President Kinnock in his work?

Lord McIntosh of Haringey: My Lords, I hope that I said so in my Answer. I said that we congratulate the European Union Vice-President on the substantial reform programme that he has put into place. That continues to be our position. Incidentally, we are also supportive of the Budget Commissioner, Michaele Schreyer, because she has been responsible for many of the reforms involved.

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Lord Stoddart of Swindon: My Lords, I can assure the Minister that I have not forgotten the subsidisation of tobacco. I cannot help drawing attention to the incongruity of banning tobacco advertising while subsidising awful tobacco in Greece and other countries of the European Union by some hundreds of millions of pounds. Is it not a fact that most of the fraud in the European Union—I almost said "the United States of Europe", but that comes later—is due to the operation of the common agricultural policy? Is it not time that our Government and other governments took real action to end this awful, corrupt regime?

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