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Lord Howell of Guildford: My Lords, I begin by warmly welcoming the noble Lords, Lord Drayson and Lord Triesman, to their new portfolios. As the noble Lord, Lord Drayson, has already said, they have a very hard act to follow. Their predecessors did us proud in your Lordships' House and set a very high standard. So I hope we will have constructive debates; I am sure we shall.

While signalling departures, perhaps I may also note a little sadness at the departure of the Minister in another place concerned with Europe, Mr MacShane, whose endearing candour and frankness enlivened debates on Europe, and, frankly, he will be missed. I have mentioned the noble Baroness, Lady Symons, and the noble Lord, Lord Bach. Both will be genuinely missed in our debates, but I welcome the new performers.

I hope that the noble Lord, Lord Drayson, will understand why I shall not concentrate on defence in my comments at the beginning of the debate. I will leave that subject for my noble friend Lord Astor to deal with at the end, so that he will have more time to study what the noble Lord, Lord Drayson, has said; just as I hope the noble Lord, Lord Triesman, will have more time to study one or two questions that I want to raise, and to which I would dearly like answers at the end of the debate.

My theme will be—not entirely disagreeing with what the noble Lord, Lord Drayson, has said—that there really are icebergs ahead; that we are sailing into extremely dangerous waters in this nation and in a very unsettled world; and that it is the duty and the role of elected leaders to be absolutely open and frank about the coming dangers. If we have a concern on this side, it is that the gracious Speech, to which we are debating a humble Address of thanks, does not show fully the extreme nature of these dangers, some of which are unfamiliar and new and need explaining if there is to be proper leadership and effective government in this country.

Carrying on as before with the usual Foreign Office clichés about being at the heart of Europe or being a bridge with America will no longer do. We are dealing with a much more complex situation. We are entering new and treacherous waters. I notice that even the arch-Europhile of the Financial Times—although he is an excellent journalist, I do not agree with him—Philip Stephens admits:

We should recognise that.

Let me give some examples of the icebergs ahead that we must deal with. The most obvious one, which we will no doubt debate fully today, is here in our
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region of Europe, where we are clearly heading for a major crisis point. I believe that everyone recognised that the constitution proposal was going to run into appalling difficulties. I am not surprised, because I thought that it was flawed from the start. Yet, there is no plan B and no attempt that I can see by Her Majesty's Government to get a grip of the situation and steer the European Union in a better direction in line with what most citizens, if not their governments, really want.

Whether or not France and the Netherlands say "No" in a couple of weeks' time, we cannot go on burying our heads in the sand. We need to take a lead in the coming presidency. We must have a referendum, certainly, as the treaty obliges us to do. Unless the treaty is wiped out, we must have a referendum—and we should, although it will set us back 80 million quid, which is quite a lot of money. We then need to firm up a date for the referendum and firm up our views on the best way forward. There has been little sign of that so far; there may be more later in the debate. That is the prime task.

I note in passing that the French are having a marvellously vigorous debate and that the text of the constitution, which is not a cheery read, is, incredibly, at the top of the best seller list in France, even ahead of Bob Dylan's autobiography. I cannot help noticing the irony that the French "No" group, which is composed of disparate forces on Left and Right, says that it is all an Anglo-Saxon plot, while the UK Government say the same thing—they say that it is a British triumph, which is the same language and the same point. So, I suppose that if Her Majesty's Government had a vote in France, they would vote with the Left-wing "Nos", because the proponents of the "Yes" vote say that it is a French triumph, not a British one at all. So that is a real area of danger and we need a bit more leadership there.

Secondly, there is the position in the Middle East, United States policy and our policy, on which the noble Lord rightly touched. We are America's ally and friend, but friends should be candid, be heard, have influence and sometimes even impose restraint. They should not be poodles, nor should they be openly antagonistic towards America, as too many EU governments sound. I do not at all like the noises coming out of Germany at present, where an anti-American, anti-capitalist, anti-Western tone is being adopted by the ruling party. Trying to work with that sort of European partner is necessary—I realise that they are huge neighbours—but they are proving poor value in transatlantic dialogue and global security issues.

We must be good and involved Europeans, but our friends and interests go wider, to the Commonwealth and the rising Asian powers. We need to be allied with other true friends of America to have an effective dialogue as we enter the dangerous phase ahead, mentioned by the noble Lord, concerning Iran, which seems to have given the thumbs-down to the agreement that he mentioned and will push ahead with yellow cake conversion and uranium enrichment—as,
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I fear, it is entitled to do under the Nuclear Non-Proliferation Treaty. These are obviously dangerous times in Iraq, where the mass murder of Muslims by Muslims continues. These are dangerous times, as simplistic ideas about imposing democracy and about Islam circulate around the world, whether in the Middle East, in central Asia or in Uzbekistan, where, according to reports, there has been an horrific massacre in Andijan—in the name of what cause, except the upholding of the present dictatorship, it is not clear.

Those are worrying aspects. On the Arab-Israeli dispute, which the noble Lord also mentioned, I think that the Americans now really mean business under the new Bush Administration. Nevertheless, we must find better means of making them stick to that commitment and somehow checking Mr Ariel Sharon's West Bank building plans, which are most unwise and are going ahead far too fast. On United Nations reform, also mentioned by the noble Lord, we will certainly need to work with the Americans. Trying to set up reforms that go against the American attitude to the United Nations and how they want to develop it will lead nowhere. It will be difficult, but we must work with them, not against them.

Those are two dangers. A third danger is nuclear proliferation, which gets a mention in the gracious Speech. Where are we? Are the EU three, which I have already mentioned, being played along by Iran? Newspaper reports say that the initiative signed in Paris is about to be discarded by Tehran. Is there not a need for a wholesale rethink of the Non-Proliferation Treaty? Are there not now significant gaps in the legal and institutional NPT framework? Should not Russia be more closely consulted in that rethinking? Can the EU three continue to handle the situation, which is moving out of control?

Meanwhile, there is a fourth danger. We are drifting blindly as a nation into a vast energy vulnerability, as oil and gas imports grow again. The global energy network was never more risky or vulnerable. That has profound foreign policy implications, of which I see little recognition in the gracious Speech or in ministerial pronouncements. The idea that this nation can somehow carry on, now that we are becoming net importers again, with a facile dependence on wind power, which is increasingly unpopular, and by postponing nuclear power decisions is wrong and dangerous. As my noble friend Lady Miller said in our debate yesterday, nuclear power decisions are long overdue. There is no mention of that in the gracious Speech.

Meanwhile, China is going around the world scooping up long-term oil and raw material contracts, something that is of huge geopolitical significance—for instance, in Venezuela, right on the edge of the United States, in Sudan, Iran and elsewhere. Tensions are rising in the Pacific, especially between Japan and China. Where do we stand on all that? It may seem remote, but it is not. Do we just drift along with French ambitions to sell more arms to China? The Japanese, who used to see the United Kingdom as their best
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friend, think that we have gone quite mad. I sometimes think that Japan would be a better ally in dealing with global balance than some rather closer EU neighbours. Anyway, does geography matter at all nowadays when looking for affinity and partnership that truly protects and promotes British interests?

There is a fifth danger: terrorism and Islamic extremism. The noble Lord spoke with amazing competence, having grasped these matters in a few days, about our military forces and their need to be reformed to meet new threats. I shall leave my noble friend Lord Astor to say more about it, but I shall just observe that our procurement policy appears to be spattered with expensive messes that need rapid tidying-up.

I merely state three maxims about defence and leave my noble friend to elaborate on many of the details, of which he has a grasp. NATO must be protected and not weakened; our regimental system must be protected and not weakened, because that is what makes the British Army so incredibly good; and our troops themselves must be protected in law when obeying the decisions of commanding officers. If we depart from those three maxims, we will destroy the morale of the best army in the world. I leave it there, but no doubt my noble friend will say more.

The sixth danger, on which the gracious Speech is completely silent, is the rising power of Asia and the fact that, even now, the Asian central banks are financing the West, certainly America, through vast dollar holdings, which they may grow tired of holding at any minute. That highly precarious situation creates an extreme danger on which the Government are silent. I do not know whether the Government are even aware of that danger, but it could hit us all very suddenly.

Problem number seven, which was mentioned in the gracious Speech and by the noble Lord, is world poverty—billions of people are living in poverty. There has been lots of rhetoric about Africa in the gracious Speech and in Ministers' pronouncements. That is all commendable, but I plead with Ministers to understand that more aid does not equal more development. One could go even further and say that aid does not equal development; in fact, there is evidence that aid sometimes means minus development. The basic problem of Africa and the many millions living in poverty in Asia—let us not assume that all Asia is prosperous—is the miserable lack of investment in the developing world because there is a lack of good governance and trade opportunities in the poorest countries. Development policy needs a new emphasis on governance, the rule of law and property rights, which enable the capitalist process to take place and will lift people out of poverty. That has happened very successfully in some parts of the world—again, in Asia—but, alas, not in Africa.

The crying problem of all in Africa is bad governance. The prime example is Zimbabwe, which is now an utter disaster. We argued repeatedly that sanctions should be tougher and that a UN Security Council resolution should be sought before total starvation and paralysis take over. In Darfur, to which
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the noble Lord referred, the horrors continue, despite the African Union's efforts to broker a deal. Again, a new Security Council resolution is badly needed, although we fully recognise the difficulties.

To return to the problems in our immediate European neighbourhood, the question that hangs in the air is this: what kind of Europe will best protect and promote our British interests? A huge debate is going on. The European old guard are still clinging to the "little Europe" dream of a tight-knit Christian group at the western end of the Eurasian landmass. The admission of Bulgaria and Romania, which was referred to in the gracious Speech, will dilute that dream a little, and the admission of Turkey will end it completely and open new paths for Europe and Asia together, linking Eurasia with the western European grouping.

It is a very bold and challenging vision. I do not understand why the Government are pussyfooting about on that bolder vision. We all know that the Franco-German motor of the old Europe has stalled, with German unemployment at its highest since the 1930s and the French economy almost in a coma. The so-called European social model is obviously a loser. The Chancellor and individual Ministers recognise that, but we do not hear it trumpeted as clearly as it should be. We know that there is no advantage in joining the euro and that those who claimed that there was will have to eat their words. There is no benefit in an outdated and Eurocentric constitution—those who said that it was the answer to everything may shortly have to eat their words. There is no joy or gain from attempting to build a common EU foreign policy where none exists. We should be active and innovative Europeans, but we have much wider world interests, which are growing as the centre of world power moves to Asia.

Does that make us anti-European? Nonsense; we have sacrificed more than most to save Europe in the past. Does it make us insular? That is nonsense, too: we are governed and constrained, willingly, by hundreds of bilateral treaties and scores of multilateral ones, all of which make us deeply interdependent. The noble Lord, Lord Drayson, was right to emphasis the concept of interdependence, which we certainly recognise.

Today we are in danger of sleepwalking into this stormy future. We are closing embassies around the world and weakening Britain's legendary global touch just when tensions are rising everywhere. It is a measure of today's turbulence that, in my comments, which I shall now bring to an end—they have gone on too long—I have not even had time to mention Cyprus, Burma, Afghan drugs, Chechnya, Kosovo, Sierra Leone, Côte d'Ivoire, Rwanda, Gibraltar, Nepal, or even George Galloway. Those countries—I except Mr Galloway—may sound remote, but every one of them spells crisis and potential danger, not just for their people but for our people and peace in the world. Failure to spell out the full implications of what lies ahead, to prepare, protect and, where possible, prevent, would be the biggest betrayal and the grossest neglect of duty of all.
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11.45 am

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