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Lord Bassam of Brighton: My Lords, we are obviously aware of that attack. The police are vigilant in these matters—they have been exceptionally vigilant. Special meetings take place regularly, and all police services in the United Kingdom are particularly aware of the issues that the noble Lord raises. I dispute the suggestion that the police lack vigilance; clearly, they care greatly and deeply, as we all do, about these matters. I add my congratulations to the general congratulations to the police service on tackling them.

Lord Mackenzie of Framwellgate: My Lords, given the fight against terrorism, to which we are all committed, and after the penetration of Buckingham Palace by a Daily Mirror reporter, does that not underline the necessity for a biometric national identity card? Members opposite complain about the police not doing their job, but it might help if they supported the police request for such a measure.

Lord Bassam of Brighton: My Lords, that is a little wide of the original Question. However, this is part of

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an ongoing debate. Yes, being able properly to identify people will make a very positive contribution to law enforcement.

Viscount Bridgeman: My Lords, does the Minister agree that the knock-on effect on other communities from what has happened in the synagogues is a danger? Will he ensure that the same welcome liaison that the police are making with the Jewish community will be extended to all other communities and their places of worship?

Lord Bassam of Brighton: My Lords, I am entirely at one with the noble Viscount. There are regular meetings between the various ethnic communities, who experience and feel threats most regularly. There is a general encouragement in the police service to ensure that racist attacks are dealt with and dealt with promptly. It is perhaps worth saying that, over the past couple of years, there has been a big increase in the number of cases brought forward by the police for prosecution with regard to racially motivated crime, and a very welcome increase in the number of defendants prosecuted and brought to justice.

Lord Clarke of Hampstead: My Lords, in the discussions that the Government have had with the security authorities, will they draw attention to the fact that each day, when children are at school, cars are pulling up and dropping off in a very short space of time? Could extra vigilance be given to those groups who have used the method of suicide bombing in the weekend atrocities in Turkey and other places? It is the most natural thing to see cars pulling up outside schools. Could schools, especially schools with Jewish children, have some special attention in that regard?

Lord Bassam of Brighton: My Lords, that is one of the issues that was discussed recently when the Jewish community met the Metropolitan Police Service. I know that the issue is being dealt with with the greatest seriousness.

Iraq: Reconstruction Contracts

3.3 p.m.

Lord Razzall asked Her Majesty's Government:

    What representations they have made to the United States administrator for Iraq, Paul Bremer, as to whether British companies can compete with American companies for primary contracts authorised for the rebuilding of Iraq.

Lord Sainsbury of Turville: My Lords, the 18.6 billion additional spending to be used on the reconstruction of Iraq will be administered by a new organisation, the Iraq Infrastructure Reconstruction Office. There is no clear agreement on what procurement rules will apply, but it is likely that the office will follow those of the US Department of Defense, whose procurement rules are more flexible than those used by US AID, which by law must give prime contracts to US companies.

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The Minister for International Trade and Investment visited Washington on 3rd November to discuss with senior members of the administration the disbursement of the supplemental budget and the role that the British private sector might play.

Lord Razzall: My Lords, I thank Minister for that Answer. I assume, incidentally, that he made a slip of the tongue and that 18.5 billion dollars, not pounds, have been allocated.

Will the Minister say whether he regards it as acceptable that, of the top 10 contracts to be let so far, all of them have been granted to American companies? Many have been granted to companies that were former employers of members of the administration, including Vice-President Cheney. Many have been awarded to companies that gave substantial donations to President Bush's election campaign. Do Her Majesty's Government regard that as acceptable behaviour, or as behaviour that would make even Lloyd George look parsimonious?

Lord Sainsbury of Turville: My Lords, it is difficult to see what proportion of contracts has been awarded to different countries, because no comprehensive list has been made. For the contracts given by a whole range of bodies, including the Coalition Provisional Authority, US AID and the US Army Corps, the last figures that we have seen are very out of date—they date back to August. The figures produced by Bechtel suggest that British companies have got a very reasonable proportion of the total number of contracts.

Baroness Miller of Hendon: My Lords, what effect does the Minister believe that the demonstrations in London and around the country against the President of the United States of America may have on any decisions that are taken by the American administrator in Iraq on the very question that the noble Lord, Lord Razzall, has asked?

Lord Sainsbury of Turville: My Lords, Mr Paul Bremer made it clear in a recent interview that he would welcome more British contracts. British companies are looking for those contracts to be given fairly and properly. When the Minister for International Trade and Investment went to Washington, he was warmly received and encouraged to put forward more bids.

Lord Watson of Richmond: My Lords, does the Minister agree that, even under more flexible rules, the probability is that no contracts will be awarded other than to foreign companies in joint venture agreements with US companies? If that is the case, where does that leave possible British contractors? Just as importantly, as the Government today confirmed, unemployment in Iraq is at 50 per cent. What are the chances for Iraqi companies to play any part in the reconstruction of their own country?

Lord Sainsbury of Turville: My Lords, under Department of Defense procurement rules, foreign

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firms are eligible to bid on prime contracts, although there is a presumption of giving preference to US firms that are able to carry out the work. In practice, most UK companies are either looking to bid on prime contracts in joint ventures with US partners or to bid for sub-contracts.

Iraqi companies are playing a very large part in the process. I mentioned the last figures that we have on the Bechtel situation, which showed that a higher percentage of the contracts were going to Iraqi companies than to American companies.

Earl Ferrers: My Lords, can the Minister say who pays for the contracts? Presumably it is not the Iraqis. Is it only the Americans, or does it go further than that?

Lord Sainsbury of Turville: My Lords, the money that we are talking about in this case is provided by the American Government.

Lord Elton: My Lords, is there any requirement on those who get the contracts to see that some of the benefit, in the form of labour and jobs, goes to local people in Iraq, and that the whole benefit does not accrue to the United States?

Lord Sainsbury of Turville: My Lords, as I have pointed out, a large number of the companies involved are Iraqi companies, which in many cases have been chosen for just that reason—because they will be using labour in Iraq. Clearly, that is very important to the reconstruction efforts and to the attempts to get the economy going again. Furthermore, given that the work is by and large infrastructure work, a great deal of it must by definition take place in the country.

Lord Brookman: My Lords, many of us are concerned about the American situation regarding steel. Will my noble friend comment on where we are with the American Administration regarding steel? To what extent does it involve our commitment and position regarding the restructuring of Iraq?

Lord Sainsbury of Turville: My Lords, they are two quite separate situations. Our views are well known on steel. The matter has gone to the WTO, which has made it clear that the subsidies for the tariffs on American steel are illegal. It is for the EU to take further action in due course, but that is a separate situation from the Iraq situation.

Earl Attlee: My Lords, would it not have been more helpful to UK companies if before hostilities commenced DfID had been more closely involved in the planning of the reconstruction of Iraq?

Lord Sainsbury of Turville: My Lords, I think it is very difficult to see how that would have taken place in practice. Clearly, it would have been desirable if more

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planning had taken place. However, I do not think that the particular issue of how contracts are allocated would have been deeply affected by that.

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