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I heard the lament of the noble Baroness, Lady Bonham-Carter, and the noble Lord, Lord Clement-Jones, about the diversion of lottery funds towards the Olympic Games. Let me make it clear again—I believe my right honourable friend the Secretary of State made this clear earlier this week—that the budget for the Games is fixed at £9.3 billion. That is what we will expect to see the Games deliver against those resources. Built into that figure is a significant contingency fund as well so the figures are realistic.

However, resources from the Lottery cause pain elsewhere where they might have been directed. While the noble Lord and the noble Baroness omitted the point from their contributions, I know that they are extremely knowledgeable in this area. I hope that they will give due regard to the fact that the Government substantially increased their grant-in-aid funding for the Arts Council England, so it should rise to £467 million by 2010-11—an increase well above inflation over the three years. I therefore hope it will be appreciated that of course the arts will play an important part of the inheritance that derives from the Games and the cultural legacy.

We do not intend to sell the arts short. It is also the case, as a number of noble Lords have emphasised—the right reverend Prelates the Bishop of London and the Bishop of Newcastle certainly did so—that it is important that communities become engaged constructively. A great deal of what will be achieved across the nation and presented both to the tourist and to the British visitor moving around the country will be the product not of central government stimulus—not all of it will come from central allocations from Lottery funds and the Arts Council—but because people are stimulated to play their part in a great opportunity for the nation in the cultural field as well as the sporting one.

I bear out the points made by the noble Baroness, Lady Valentine. She is right that co-ordination between local authorities and boroughs is important and that a masterplan in place. She will recognise that we intend to launch the masterplan fully shortly; it will be a product of the co-ordinating activity that undoubtedly is necessary when so many significant actors are on the scene.

In that respect, a contrary perspective was put by my noble friend Lady Whitaker that authorities have not always been entirely successful in their relationships with a minority group like the Travellers. I know the strength of her conviction on justice for Travellers and I know the work that she does. I regret that some mistakes have been made—there is no doubt about that—and apologies have been made to the Travellers for one group’s allocation to an unsatisfactory site. That was unacceptable. We will certainly be offering the Travellers the opportunity to return to the Olympic Park when the Games are over, if they so choose. We have pretty clear indications that the successful development of other sites in east London at present are proving satisfactory and, therefore, they may choose to stay where they are, rather than return to the Olympic site.

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I am grateful for the contributions from the noble Lords, Lord Coe and Lord Moynihan. They are playing very significant parts in the Olympics. Everyone recognises that without the work done at that level, we would not have made such rapid progress thus far. I know that they have been through trials and tribulations; after all, as the noble Lord, Lord Coe, emphasised, it is quite the biggest project that can be conceived of in the area of sport and athletics for many years, if at all. He is to be congratulated in the leadership that he has offered. The priorities are being responded to and they are clearly to the fore.

We do not have the slightest doubt that we are in position to create the best Olympic Games ever, but we are also in a position to move in a diametrically opposite direction from Sydney. I think the noble Lord, Lord Ouseley, made reference to the Sydney experience and the inheritance of the Games being of limited value to much of the city’s population, which is certainly true. We are concerned that the legacy will be of benefit to the whole nation. The nation will be stimulated by the Olympic Games, which will be held in London in 2012. We hope we have an excellent performance in the sport and athletics arenas and in the sports that are carried out throughout the country. I make the obvious point that Newcastle Football Club will expect its ground to be used for matches in the Olympic Games tournament.

It is important that, in addition, the cultural legacy is enhanced as a result of the Games, that the whole of Britain takes possession of the Games and that it is excited about one of the most significant developments that this country has seen for many years. The opportunity is so great in comparison with 1948. The Olympic movement was grateful to the United Kingdom and to London for its efforts in 1948, so shortly after the war and for picking up the Olympic Games at very short notice. Those Games operated under some pretty dire privations with limited ambitions but these Games have the greatest ambitions. It is the intention of the Government that those ambitions should be fulfilled.

2.04 pm

Lord Mawson: My Lords, with an eye on the clock, I thank the Minister for his very helpful comments and for the way in which he has responded to the debate. We need to keep the dialogue going. There is not time now to take further the points that he makes, but I will be happy to host a visit to the Bromley-by-Bow Centre for him and other noble Lords who are interested and to show you what the issues look like from the inside of a housing estate a few hundred yards from the Olympic site. I thank the noble Lords, Lord Coe and Lord Moynihan, for their contributions. I am very confident that they will ensure that we return with a very large bag of medals and that the sporting event will be run extremely well. I thank my noble friend Lady D'Souza for helping me to prepare for the debate.

I also thank all noble Lords who have taken part in what has been a far-reaching and, I hope, helpful debate. In the coming months and years, I shall try to

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keep these concerns before the House and update of the House on progress. My purpose in raising these issues is to attempt to give a view from the inside of the East End of London into what some of these complex issues look like on the ground and to share with your Lordships' House the opportunities that now exist to help us all to learn the lessons of the Dome and other regeneration projects that have not delivered the added value that we had hoped. I agree with the noble Lord, Lord Young, that the key is to bring together the macro-responsibilities of the public sector with the detailed micro-understanding of business and social entrepreneurs who are now delivering sustainable projects on the ground in the area.

The debate has enabled me to show your Lordships’ House the work of social entrepreneurs which is still too little understood but which has important national and international implications for how we regenerate some of our poorest communities. I hope that we have all found this a helpful debate. I beg leave to withdraw the Motion for Papers.

Motion for Papers, by leave, withdrawn.

British Council: Russia

2.06 pm

Baroness Royall of Blaisdon: My Lords, with the leave of the House, I shall now repeat a Statement made in another place by my right honourable friend the Foreign Secretary, on the Russian Government’s actions against the British Council in Russia. The Statement is as follows:

“The House will recall that, in October 2007, the Russian Government threatened to close down the British Council's operations outside Moscow from 1 January 2008. This was confirmed on 12 December and then again last week with the threat of a series of administrative measures against the British Council, including tax measures in St Petersburg and visa restrictions against British Council staff in St Petersburg and Ekaterinburg. The Russians also threatened to take measures against the British Council in Moscow, up to and including the removal of accreditation of British Council staff working in Russia.

“On Tuesday, the Prime Minister's foreign policy adviser held what we believed were productive talks in Moscow about a range of international and bilateral issues, including the British Council. Yet on the same day the Russian Government exerted further pressure on the British Council. The Russian security services summoned over 20 locally engaged members of British Council staff in St Petersburg and Ekaterinburg one by one for interviews. Ten members of staff were interviewed late at night in their homes after calls by the Russian tax police. Questioning ranged from the institutional status of the British Council to personal questions about the health and welfare of family pets. These Russian citizens have chosen to offer their skills and hard work to promote cultural contact between the people

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of Russia and the UK. As a result, they have been the subject of blatant intimidation from their own Government.

“I think the whole House will agree that such actions are reprehensible, not worthy of a great country, and contrary to the letter and spirit of the legal framework under which the British Council operates, notably international law, including the Vienna conventions, and the UK/Russia 1994 bilateral agreement on cultural co-operation which Russia has ratified. Russia has failed to show any legal reasons under Russian or international law why the British Council should not continue to operate. Russia has also failed to substantiate its claims that the British Council is avoiding paying tax. The British Council is in fact registered for tax in Russia and has complied with all requests of the tax authorities in respect of its activities. Therefore, instead of taking legal action against the council, they have resorted to intimidation of the council's staff. I am confident that the whole House will share the Government's anger and dismay at the actions of the Russian Government. We saw similar actions during the Cold War but thought they had been put behind us.

“The British Council's first priority is, rightly, the safety of its staff. Yet the actions of the Russian Government have made it impossible for staff to go about their business in a normal way. British Council offices in Ekaterinburg and St Petersburg have been prevented from operating, and therefore the British Council has taken the decision to suspend their operations in those two cities. The council is making an announcement to this effect as I speak. The staff concerned will continue to be supported while the Council considers its next steps.

“There has already been strong international condemnation of Russian actions. Following my conversation last night with the Slovenian Foreign Minister in his capacity as presidency of the EU, he agreed to issue a statement today on behalf of all European governments. The US Government have issued a statement of support calling for the British Council to be able to continue its good work in Russia. The Canadian Government are expressing their concerns in Moscow about developments. I am grateful also for the many expressions of support the British Council has received from Russians who have benefited from working with the British Council.

“Mr Speaker, the Russian Foreign Minister stated publicly on 12 December what the Russian Government had been saying to us in private; namely, that attacks on the British Council were linked to the Litvinenko issue. I announced on 16 July to this House a list of measures the Government had decided to adopt in response to Russia's failure to co-operate with our efforts to secure justice for Alexander Litvinenko. These included introducing visa restrictions for Russian officials travelling to the UK and suspending our visa consultations. The House can rest assured, Mr Speaker, that these measures will continue to be administered rigorously.

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“But we regard as entirely separate issues Mr Litvinenko's murder and the activities of the British Council to build up links between British and Russian schools and universities, to support English language teaching in Russia and Russian studies in the UK, and to promote the best of British drama, writing, music, and art. Nor do we believe that cultural activities should become a political football; in fact, educational and cultural activities are important ways of bringing people together. That is why I have decided not to take similar action against Russia's cultural activities in the UK, for example by sending back Russian masterpieces scheduled for show at the Royal Academy, or by taking measures against the two Russian diplomats at the Russian Embassy dedicated to cultural work. We have nothing to fear from these contacts; we welcome and encourage them. The immediate cost to the Russian people of the Russian Government's actions is their access to the benefits of British Council activity. The longer term cost is their country's standing in the world as a responsible international player. The British Council will continue its work in Moscow, meeting the demand from as many as possible of the 1.25 million Russian citizens who used the council's services nationwide last year.

“Mr Speaker, the council's experience in Russia is not repeated in any of the more than 100 British Council operations elsewhere in the world. Russia's actions therefore raise serious questions about her observance of international law, as well as about the standards of behaviour she is prepared to adopt towards her own citizens. This can only make the international community more cautious in its dealings with Russia in international negotiations and more doubtful about its existing international commitments.

“Russia remains an important international player in addressing key global issues and challenges, including climate change and energy security, as well as others, such as Iran and Kosovo. But I hope the whole House will agree with me that Russia's actions against the British Council are a stain on Russia's reputation and standing that will have been noted by countries all around the world. I will continue to keep the House informed of developments”.

My Lords, that concludes the Statement.

2.13 pm

Lord Howell of Guildford: My Lords, we are all extremely grateful to the noble Baroness for repeating the Statement by the Foreign and Commonwealth Secretary. We welcome it; it seems robust and measured. Nothing is to be gained by tit-for-tat reactions and threats or by claiming that one measure is “the logical consequence” of another, as the Russian Foreign Minister, Mr Lavrov, has been doing. This is childish and not the language of a great nation on the international stage.

It is impossible not to see a pattern of diplomatic ineptitude in this whole situation. Someone once said that the job of diplomats and foreign ministries was

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to prevent second-class matters becoming first-class rows. Here we have a string of undoubtedly serious but not strategic issues, starting with the Litvinenko-Lugovoi affair, which have somehow been allowed to coalesce into a situation with real bad blood when they should have been kept apart.

There cannot be, nor ought there to be, a conceivable connection between the need to track down the perpetrators of the Litvinenko crime and the hassling and harassment of British Council staff. The Russians claim, and their ambassador was saying the same only yesterday, that they “understand” the British position. They do not. Perhaps more might have been done to get over to them the true position both on this matter and on other areas of difference, such as in the Balkans and matters of missile defence. A better job could have been done.

The central point is that the British Council is not an instrument of British government policy and purposes—sometimes around the world it seems to be doing quite the opposite. Moscow has not grasped the concepts of the separation of powers and of truly independent agencies, which are complex and subtle. They ought to latch on to these ideas now because it seems that their own agencies have highly separate agendas. As the Minister has described, that is the only way one can make sense of the fact that, while the Moscow Foreign Ministry is having supposedly helpful and reassuring talks with UK officials, the Russian security bosses are harassing British Council workers and clients, visiting them in their homes in the night and generally acting like Soviet heavies from central casting.

There has been a lot of talk about the British Council’s legal position and I would like to ask the noble Baroness some questions about that. Is the 1994 agreement between our two countries on co-operation in education, science and culture legally binding? It specifically encourages close cultural ties and mentions in Article 14 the necessary role of the British Council in carrying forward these purposes. If it was legal last year, why it is not legal this year?

Russian Foreign Ministry officials have made much of the fact that cultural organisations from other countries, including France and Germany, are, they say, complying with Russian law as non-governmental organisations and operating without difficulties. Could we know under what conditions they are operating, and why and how they differ from the arrangements with the British Council? Russian officials have also been quoted as saying that the British Council’s Moscow offices could be targeted next if no agreement on the status of cultural organisations and the availability of British visas for Russian diplomats were reached. Can she confirm whether Russia has sought a new agreement on the status of cultural organisations if it does not like the present one? Have any other British institutions been subjected to similar pressures?

We insist on being friendly towards the Russian people. They are a nation that has been through harrowing times in the 20th century and with which we stood shoulder to shoulder against attack in the past. For centuries we have been linked by trade and

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commerce, and today we are Russia’s largest foreign investor. Our arts and literature are deeply interwoven and have been all along. From the time of Peter the Great, who spent time working in a British shipyard, the British have been Russia’s best friends in the West.

For the Russian authorities to act now in this way is not only—in that overworked diplomatic word—unacceptable, but it makes a leading nation like Russia look ridiculous and makes everyone else a lot more cautious in their dealings with Russia. How crazy, for instance, it would be for us to be dragged into trans-European networks for daily gas supplies relying on Russian suppliers. That would be the reaction of many people.

Far from bickering, we should be working more closely than ever with Russia on the great global and strategic issues in eastern and central Asia, in controlling nuclear proliferation, in the Middle East, and on environmental and energy issues. All those are directly in the Russian interest.

I hope that today’s Statement, and the sensible decision not to retaliate further against Russian cultural activities here, which we welcome, can mark a return to mature co-operation on all these future challenges between our two nations.

2.20 pm

Lord Wallace of Saltaire: My Lords, I was one of a group of Members of this House who visited Moscow last February and spoke to staff at the British embassy and British Council about the range of petty harassment that they were both suffering. My wife and I also informally visited the British Council in St Petersburg last April—Stephen Kinnock is a former student of my wife—and learnt something about the petty harassments which were already under way there. Therefore, we appreciate that this situation has not come out of the blue at all; it is a ratcheting up of pressures. We on these Benches approve strongly of the Government’s moderate response and their attempt to ensure that it is co-ordinated, first, with those of our partners in the European Union and then more widely with those of other members of the civilised community.

One of my strongest impressions following our week in Moscow last February was that the Russian interpretation of “sovereign democracy” is that, now that Russia has re-established itself after the humiliations of the 1990s, it be allowed to behave like a great power. There is an unfortunate interpretation of the way in which the Bush Administration behave as a great power, which is to say, “Great superpowers are above international law. We don’t have to obey the same rules as everyone else”. That is very much the way in which the current Russian Government interpret their position. Therefore, we have to insist that international law operates and that, if Russia wants to be considered a civilised and responsible member of the international community, it must also apply the rule of law domestically.

As I understand it, the accusation of illegality which is being brought against the British Council has not been made specific, and therefore part of our problem in responding is that we do not entirely know

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what illegal activities we are supposed to have been undertaking. That is absurd, and we clearly have to take this as a general problem for the international community and respond in that way. This seems to be a situation in which a co-ordinated European response is particularly appropriate, because the Russian Government are attempting to pick off European Governments one by one—Poland on some issues; Germany on others, and so on—in order to reassert their superiority in a number of areas. Solidarity and unity in responding is therefore clearly very important.

What can be done about the interests of local employees in British Council offices? I understand that several local employees have worked loyally for the British Council for many years, and we have to do our best to look after their interests. I have had conversations with a number of people from Russian universities about how they would like to build closer contacts with British universities. What is the appropriate response to both individual students and Russian institutions which want closer links with British educational institutions to be maintained when the British Council, which has done much to help in that regard, appears to be prevented from doing what we all want it to do—build closer links and pull Russian society and Russian intellectual life closer to our own?

2.24 pm

Baroness Royall of Blaisdon: My Lords, I am grateful to both noble Lords for their strong support of the British Government’s position on this very difficult situation. The noble Lord, Lord Howell, is absolutely right that we should not engage in tit for tat. That would be demeaning, and there should indeed be no connection between the Litvinenko case and the harassment of British Council staff. I do not think that British diplomats have failed in their work in any way; they have acted absolutely correctly throughout.

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