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Over many years I have heard some thin gracious Speeches but this time the Speech was, dare I say it, positively anorexic on foreign affairs. We are in the midst of a triple series of major international crises and events, including a hideous global recession with huge political consequences on top of our own home-grown pickle. All this will shake and shape our lives for years ahead, and the gracious Speech had about 150 words on the whole world scene. That is all it could manage. This morning, it was reported by the BBC that there is a competition to tell the whole Christmas story in 30 seconds. Whoever drafted the overseas section of the gracious Speech must have thought that they were competing in it. There was nothing in the gracious Speech about our relations with the United States of America, although the noble and learned Lord, Lord Falconer, in his brilliant speech yesterday, had plenty to say about America. There was nothing about our very poor relations with Russia, which are very worrying. There was nothing about the

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importance of our links with the rising powers and wealth of Asia, precious little about looming energy security threats and nothing, but nothing at all, about the Commonwealth.

I was frankly amazed that there was not a single mention of the Commonwealth in the gracious Speech. It is an invaluable network that gives our international position and interests such advantages in the new world now emerging, with power and money lying increasingly in Asia. Other nations look with envy at the positioning and opportunities that our Commonwealth link offers, although here in London we seem persistently to underestimate and neglect them. The Commonwealth embraces at least six of the world’s fastest expanding and most dynamic nations. It is no wonder that our other friends, such as the Japanese, have a growing interest in contacts with the Commonwealth and its potential development as a 21st-century platform of democracy and transcontinental cohesion.

Why were all these issues, which are so vital to our national interest, left out of the gracious Speech? It is inevitable that our debates in the next few days are going to be about not so much what was in the gracious Speech but what was not in it. It is probably true to say that three matters of interest are at the forefront of our minds on foreign policy, each marking a potential watershed in world affairs and in our nation’s affairs. First, there is the coming financial tsunami. Indeed, it is already here, but the coming consequences threaten a deep and prolonged global recession and are bringing economic and political turmoil in their wake, causing great concern to every citizen of this country. Secondly, there is the advent of a new American President with, we hope, new and fresh approaches to current world crises. Thirdly, most obviously and dangerously, there is the now ever present threat of much more terrorist violence anywhere and anytime, but most bloodily and recently exemplified in the Mumbai slaughter a week ago. I do not propose to say much more on Mumbai while the full story is yet to come out, except to seek reassurance from Ministers that British citizens, who were specifically targeted, are being looked after and to pray that the recent Pakistan/India rapprochement, of which there used to be signs, will not be totally undermined by this horror. Pakistan, the apparent home of the assassins, is filled with countless madrassahs in which hatred and violence are constantly taught. President Zardari frankly admits that the Taliban has “the upper hand”. Mumbai is a warning that whatever occurred there a week ago is a direct threat to us all in this country as well.

I speak about Asia, but at the same time, we remain good Europeans because this is our region and Europe-wide stability and prosperity are essential to us. However, we must never let regional EU preoccupations weaken our resolve to maintain and strengthen strong bilateral ties with the newer and richer global powers which are tomorrow’s world leaders. That is something that our history and skills uniquely equip us to do. That is where our main interests and the sources of our stability and continuing prosperity will increasingly lie. Noble Lords debated the future of the European Union, some would say ad nauseam, back in the summer. Let me make clear once more how we view this whole issue. Contrary to many slanders, it is not a question

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of being pro- or anti-European. It is not like that. We on these Benches are not anti-Europeans, although we are certainly anti-rigidity and anti-centralism.

We want a Europe that is democratic, is efficient, retains its endless diversity and is not overambitious. That is why many of us like the tone of the famous Laeken declaration, which called for a less remote EU, and why we were deeply disappointed, as we made clear, in the subsequent power-centralising EU constitution, which was then served up again, after its rejection, thinly disguised as the Lisbon treaty, with its obsession with institutions rather than practical outcomes. We all remember that we on this side were voted down on the treaty. The truly remarkable noble Baroness, Lady Ashton, who I was sad to see go, sprayed us with government arguments at machine-gun speed—I doubt if the Brussels Commission yet knows what is going to hit it.

Since then, our Irish neighbours have expressed their concern through the referendum that we were outrageously denied. Our unease can only have been increased by subsequent events. There is the attempted bullying of Irish opinion, which we think deplorable. The suggestion from Paris that our robust Czech friends are somehow, because of their healthy doubts, not fit to hold the full responsibilities of the EU presidency is equally deplorable.

When will it be grasped that visions of a single EU defence force, which inevitably weaken an already troubled NATO, are remote from all realistic possibilities, as are fantasies about a single voice for EU foreign policy or dreams of the EU,

as one Euro-idealist suggested, into the world's trouble spots? Those are inflexible ideas. They are recipes not for action but for delay and committee deadlock. The outcome is always inevitably the lowest common denominator. They are redolent of past thinking which so much favoured superblocs and central control, and defy the common sense of the network age, which calls for patterns of co-operation that are altogether more flexible and adaptable. Other EU attempts at rigidifying bloc organisation and integration leave us just as unimpressed, such as the working time directive, due to be addressed in the European Parliament next week, which is quite unsuitable for our economy.

In our summer debates, we were told again and again by the most learned lawyers in this House that there was no escape whatever from the supremacy of EU law in ever wider areas covered or about to be covered by the treaties. We were told that there was nil possibility of protecting our constitution in the way that bodies such as the German Constitutional Court are empowered and minded to try, starting as it does from the utterly correct view of the EU not as an embryo federal state but as a Staatenverbund, which means a Europe solidly built on nation states.

One wonders whether it will ever be understood here in our Foreign Office or in policy-making circles that citizenship and nationhood go together. As our excellent EU Committee reported under the now sadly ending chairmanship of the genial and noble Lord, Lord Grenfell, the EU Commission's annual policy strategy spoke ambitiously of “putting the citizen

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first”, but citizenship means belonging. It means agreeing to be governed by people whom the citizen may not like. It means agreeing to be loyal or even to die for one’s country, knowing that, in the end, the lawmakers can always be held to account and removed—unless, of course, they have first been removed under arrest by the police.

The Lisbon treaty, which so obviously tilts the balance still further against accountable nationhood and in favour of still more institutionalised central power, went sliding through this House, aided and abetted by our Liberal Democrat friends and their manoeuvring, which left most of us dizzy. We all learnt to love the amusing speeches from the noble Lord, Lord McNally, but this time he showed yet another amazing skill as a top-league contortionist. We continue to marvel at his variety of skills.

We say here that if that unpopular treaty, which would certainly have been voted down in France and other member states had they been given the chance, has still not been ratified by some manoeuvre when we take office, the country will have the referendum originally promised by all parties.

As I said earlier, the gracious Speech oddly failed to reaffirm our close alliance with the United States. There is a view in the UK that we have a choice between being with America or with Europe. I do not accept this view for one moment, although the former Prime Minister, Tony Blair, seemed at times to oscillate, to most people’s bewilderment, between these two imaginary poles. However, there can be no doubt that our relations with the USA are extremely important, or that they are already undergoing considerable change and are likely to change much further as the direction of the Obama presidency becomes clear.

My hope is that Americans will start to talk less about asserting world leadership and more about co-operation and partnership with other nations within the global network; less about domination and imposing American values worldwide and more about playing on the team in a spirit of mutual obligation and respect for the values and cultures of others. One hears about the American insistence on leadership. Indeed, both the left and the right in America seem to start from the point that America must somehow take over the world and be the top dog again, but those days are gone.

Washington power is receding, Wall Street bankers are no longer masters of the universe, and the financial power is shifting instead to high-saving Asia and the cash-rich oil-producing world. These are now the surplus countries with the money and the sovereign funds, which are being called on to rescue banks, industries, car industries and debt-ridden western nations on both sides of the Atlantic. Frankly, he who pays the piper calls the tune. Only the other day, the Prime Minister, Gordon Brown, was travelling around the Gulf, urging the rulers there to use their enormous funds to buy up British assets. This is the begging-bowl economy to which we have now sunk.

It does not follow either that America’s colossal defence-spending, which is vastly bigger than everyone else’s put together, guarantees superior power and

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influence. The asymmetry of warfare changes the balance decisively against the mammoths, making the most expensive military hardware vulnerable to deadly but miniaturised weapons in suicidal hands. Nevertheless, we need to know now exactly how the new Administration will handle the withdrawal from Iraq and how the new status of forces agreement, which the Pentagon clearly dislikes and which defines the American military role for the next phase, affects us. We also need to know what the noble Baroness, Lady Taylor of Bolton, meant by the “long-term bilateral ... relationship” between Britain and Iraq that will now emerge. What are the legal, and many other, aspects of that?

We need to know whether Mr Obama and General Petraeus really still believe that another surge will work in Afghanistan. It seems that the whole Afghanistan strategy is now being rethought; there are reports to that effect in the English newspapers this morning and in the American newspapers last week. There also seems to be the recognition that there is no military solution and that political reconciliation with the Taliban is the only workable way forward. I hope that our input into that thinking is really good and that we are not simply pouring in 4,000 more of our brave troops to follow exactly the same path as before. I hope, too, that we are warning our American friends from experience and history about the dangers of trying to secure any kind of permanent victory in Afghanistan, where one can almost unendingly win ground by day and lose it every night, as our senior military people and diplomats have wisely pointed out.

We need to know whether America will join in engaging Iran more deftly, deploying both stick and carrot approaches, or whether it will carry on with the former axis-of-evil line, which frankly seems to be heading nowhere. We also need to see far more determined support from America, among others, for ending illegal Israeli settlements, for building a viable Palestinian state and for doing everything that it can to end the Fatah-Hamas zero-sum game. There is also an ambivalent Syria to be handled with patience, the dilemma of a still-growing Hezbollah in Lebanon and rising tensions in Egypt. All these things need to be watched. We should certainly work with the Americans, but I question whether we should acquiesce in their insistence on being the leaders and even trying to dominate. We should do more of our own thinking. In sum, our role with Washington should be that of the good but candid friend. We should be solid but not slavish, in the appropriate words of my right honourable friend William Hague.

The key to UK policy in all these complex areas is to have confidence in our own capacities and our own identity to know who we the British are and how we can uniquely and most effectively contribute to global stability. We must certainly work with others in a totally interdependent world, but not be run by others, as too often seemed the case in recent years. If we lack a clear lead and definition of our national purposes and potential, we will lack the inner unity and cohesion to make our own society successful and peaceful. The two go together. Foreign policy is not the poor relation of our national interest. In particular, we must now address some urgent and practical issues directly affecting our national interest and welfare.

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First and foremost, there is the question of the morale of our Armed Forces and the problems of equipment delays and inadequacies. My noble friend Lord Astor will return to these in detail later in the debate. It was always a central priority of British policy to have a first-rate, world-class fighting force. That has been allowed to lapse. We will not let that point go and I know my noble friend will make it.

Secondly, we have to ask whether the balance between a clearly underresourced Foreign Office and a much larger DfID budget is the right one, as it is plainly crippling our diplomatic efforts. I notice that even your Lordships’ Written Questions to the FCO have gone unanswered for weeks and months on end. The Minister told us that this is due to “an administrative error”. This is just not good enough. This department must get its act together.

This is supposed to be the age of soft power. Top-class Armed Forces should go hand-in-hand with the expanding deployment of soft power, cultural diplomacy and non-governmental networking as never before. Your Lordships’ House is probably one of the best endowed legislative bodies in the world in terms of sheer experience, international connections, culture, technical knowledge and diplomatic skills. We should surely never rest in demanding that these advantages be fully used in the national interest.

Further vital points must be discussed, particularly as regards Africa. I have not mentioned Zimbabwe, where cholera fills the streets and troops are rioting. It cannot be long before that nation collapses completely, unless and until Mr Mugabe goes. There are many other tragedies in Africa: we have debated the bloodshed in the Congo; Somalia is now a failed state, full of piracy; and there are dangers in southern Africa. No doubt those issues will be raised in the debate.

The most dangerous prospect for this country is that we are about to become again a major energy-importing nation. Security of supplies is again a critical issue of foreign policy. Thanks to dithering over new nuclear construction and overoptimism about costly renewables, we now face a serious possibility of electric power shortages in the coming years. When electric power fails, people die and society is paralysed. For the next few years we will be hugely dependent for power generation on imported gas, probably much of it from Russia, and on bad old coal, probably uncleaned and unfiltered. It will be for the simple reason that the economic carbon sequestration techniques so blithely demanded by our pundits have not yet been invented on a commercial scale.

We have here the full and terrible legacy. From the previous Prime Minister, Mr Blair, we have inherited an overcommitted military, which is involved in two long wars, Armed Forces who lack the support they deserve, an ambivalent national role and purpose, and now possibly blackouts to boot. From the present Prime Minister the legacy will be even worse. By the year after next I understand that we will be spending more on interest payments on our colossal borrowings than on the entire defence and schools budgets combined. The possibility of UK default is now being priced by traders into the market for the first time since the 14th century. These past 11 years have been truly the years eaten by the locusts of spin, incompetence,

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dithering and defeatism. We cannot have a strong and effective foreign policy or real sense of national unity, pride and purpose until this dismal period is ended and its authors depart the scene. They have sat here too long and they should go.

11.55 am

Baroness Northover: My Lords, on behalf of these Benches I, too, express our support for the tributes paid by the noble Baroness.

The Queen’s Speech mentioned next year’s G20 summit on the world economy, NATO, Iraq, Iran, the Middle East, Afghanistan and Pakistan. There was no mention of climate change, Africa, aid, the stalled trade talks and the other areas mentioned by the noble Lord, Lord Howell. It was a speech generally thin and vague on intention and timescale, so perhaps we can unpick some of it and suggest other areas where we would urge the Government to be active and on which I look forward to the Minister’s reply. My noble friends will also be highlighting a series of important issues in this wide area. I know that we will have an extremely impressive debate around the House and I look forward to it.

If we did not know it before, we clearly know now from our economic problems how something that happens in one part of the world can quickly have catastrophic effects elsewhere. As we seek to tackle our own problems of recession, house repossessions, people losing their jobs, pensions falling through the floor in value, investment in public services potentially being hit over the longer term as the Government cut back, rising taxes and huge uncertainty about the future, it would seem easy to forget the rest of the world. This crisis shows what a mistake that would be. We can see how a decline in the demand for toys in America means that factories in China are closing down and that recycled paper from the UK used in packaging is no longer required, so that companies here go under. The whole chain affects us all. It is therefore welcome that, in dealing with the economic crisis, countries such as China, India and Brazil are now involved. As President Lula of Brazil put it:

“There is no logic to making any political and economic decisions without the G20 members—developing countries must be part of the solution to the global financial crisis”.

However, the agreement and the meeting flagged up in the Queen’s Speech include only 20 countries. Many of the poorest and most vulnerable nations were not included in the recent summits, yet they may suffer most from the economic downturn. Let us take the case of Botswana. Concern about diamond sales may not be at the top of our agenda, much as we admired diamonds yesterday, but Botswana is hugely reliant on its diamond exports. It is therefore shocking to hear that last month Botswana received no revenue at all from this source, partly because western markets dried up and partly because diamond traders could get no credit. Just think of the effect of that on a country with extensive poverty, an incredibly high incidence of AIDS and little in the way of social protection.

Whatever the obvious moral case for concern, we must also recognise our own self-interest in this. We know that economic pressures force migrations and

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cause environmental destruction. Stability and prosperity go hand in hand. We know that economic exclusion plays into the hands of those who wish to exploit it for political, often extreme political, ends. We know, close to home, how much easier it was to bring peace to Northern Ireland once prosperity and social justice had made progress.

In this financial crisis, which overarching world organisations are grappling properly with the needs of the poorest countries? Do the developed countries see this area as a priority? Do the Government realise its significance? Can I have an assurance from the Minister that the Government will pledge not to cut development assistance but maintain their commitment to increasing it to their current target of 0.7 per cent of GNP by 2013? In addition, will they look to international action to extend credit to emerging markets that are in problems? As Simon Maxwell of the Overseas Development Institute—I declare an interest as a council member of the ODI—says:

“Development is in everyone’s interest”.

Yet he also rightly says that international development will not stay on the agenda,

It may be that it is up to us in the House of Lords to take the longer view.

What of the new Bretton Woods? How do we take forward international structures that can effectively tackle the economic, food and energy crises? We have to recognise that, in historical terms, the United Nations is a recent creation. It is clear that it and its various parts need to evolve further to increase its usefulness.

It is worrying that the Queen’s Speech mentioned nothing about climate change, which is clearly an area where there will be great pressure; for example, we hear today that Italy and Poland are resisting the EU stance in the current negotiations. We already know that climate change hits the poorest first. In the Climate Change Bill, the Government made significant and welcome commitments, but what will happen now? Will the Government put muscle behind a green strategy in the UK and the EU for getting out of this recession, or will green policies be sacrificed? If it is the latter, we store up for ourselves far more major problems down the track. Of course, Barack Obama has said that he will engage the United States at last in the battle against climate change, which is extremely welcome. I know that we have huge expectations of the new US President. Politics will constrain him no doubt, but, as we have heard, we see a different mindset, which is enormously welcome.

We may soon see the effect of the change of Administration on policies on Iraq and Afghanistan. The UK has been mired with the United States in Iraq. The Queen’s Speech refers to “continued progress” in Iraq. There is still no public recognition by the Government of what an error that war was. Might the Minister feel able to rectify that today? Might he also say something about the timescale for our withdrawal from Iraq? As we have heard, the British role is surely now marginal, reduced to Basra airport. We have heard about the huge commitment and the effect that this operation has had on the British forces. It must

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indeed be fairly unbearable for families and for the military itself to bear the danger and losses against a background of a lack of public support for this enterprise. We must at the very least make plain our unstinting support for the military’s efforts, whatever we felt about the enterprise as a whole.

By contrast, of course, there was international agreement about the engagement in Afghanistan. The noble Baroness clearly recognises the enormous significance of what is happening in Afghanistan by her concentration in her speech on what we are doing there. However, it is surely worrying that Afghanistan is associated with Iraq, in the eyes of some in the UK, as an illegal and inappropriate war. Is this not also an argument for getting out of Iraq as quickly as possible so that these operations can be separated out? I have heard this year disturbing comments, from Conservative MPs in particular, about the impossibility of this task and the need to consider pulling out. Clearly the noble Baroness recognises that. Does the noble Lord agree that there would be serious dangers if cross-party consensus were to break down? Not least, what would be the effect on NATO?

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