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That major change must be a precursor to something else. Some of the very shrewd veterans of City practices are now saying, “My word, this means that the Government are already surreptitiously devaluing the pound”, which has fallen significantly from the summer pre-crisis rate to the present level. The pound has become a marginal international currency. There is no shame or excessive sadness in saying that; it is just the reality of the sweeping monetary movements that have occurred in the world over the past five decades. The pound sterling is now down to 4 per cent of total reserves. The leading reserve currency—the United States dollar—is now being approached more and more closely by the euro, which is emerging as the strongest currency in the world.

Although this debate concerns mainly foreign affairs, I am sure that the Minister would be prepared to refer, even briefly, to the question of Britain joining the euro—a matter that is moving more and more to the fore. Even if the British Government decide to submit that as a proposal, as we know, it would take some time for it to be achieved under the procedures of the European Central Bank. It would also be a very good opportunity for the Government to get rid of referendum-itis—the poison that is still in the British system—as they did, very bravely, with the Lisbon treaty. We on these Benches were glad about that and welcomed it, and we supported the Government wholeheartedly in what they did with that legislation. There is no intrinsic reason for the Government to hesitate on this matter. Therefore, I hope that there will be a strong Answer to my Oral Question, number 4, on Monday. President Barroso, one of the most respected Presidents of the European Commission, recently referred—rather provocatively, in the view of UKIP Members in the European Parliament—to the prospect of us joining the euro. He said that many more British politicians now want us to do so and would very much welcome it.

With apologies to my noble friend Lord Addington and others who mentioned important defence matters, I turn briefly to another major area that has emerged repeatedly in this debate—the Middle East and Israel/Palestine. This matter must now be tackled by our Government, as well as the European Union portion of the quartet. The recent meeting of the quartet in mid-November, with the French presidency taking the lead and Russia making much more of a contribution than usual, was encouraging for the first time. Russia will host the next meeting at the end of the first quarter of next year. However, when these matters were raised in the short debate on 13 October in the previous Session, there was nothing new to report. I say that with no disrespect to the Minister, whom we admire very much and welcome once again on this occasion. He has been a very patient listener to this long debate. He himself reiterated the position of the

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quartet and this country’s participation in it back in January and February. Now, surely the Government realise that there must be forward movement. I am sure that the Israeli Government realise it—there are signs of that.

I also saw Tzipi Livni very briefly at the European Parliament on Monday when she addressed the Foreign Affairs Committee. No one knows what will happen to her. Would she be Prime Minister if she managed to win? Perhaps it will be Mr Netanyahu instead, as people in Israel tend to expect. The polls in Israel show that people want to have discussions. They even want to talk to Hamas and the fringe parties in the Israeli political spectrum. The Shas and other parties privately say that they would like to talk to Hamas directly, behind the scenes to start with, but no one encourages them to do so.

It is not anti-Israel but pro-Israel to say that the time has come for that Government, and the new one after the elections next year, to seize this opportunity and do a deal. Israel has so much compared with Palestine. Palestine has 22 per cent of the territory left of the combined territory after partition in 1947. Now is the time for Israeli generosity, which will then help them to save the Zionist state of Israel, which I support, as does the noble Lord, Lord Steinberg. That is the only reality that matters. If they postpone again and look to the United States to give them artificial support by endless vetos of UN Security Council resolutions, that will be a blind alley that will eventually destroy the Zionist state.

Please, please, after so many powerful contributions made tonight—we are proud of the contributions from these Benches as well—can the Minister move forward and give us some powerful assurances that the quartet is not just a farce but a reality of international importance?

6.16 pm

Lord Astor of Hever: My Lords, this has been an excellent debate. We have a very impressive speakers list, but one name is missing—my noble friend Lady Park of Monmouth, who, I know, would have wanted to be here tonight to speak on Zimbabwe and defence issues, which she always does so well. I hope that I speak on behalf of all noble Lords who have spoken in wishing the noble Baroness a speedy recovery and that she will be back in her place very soon.

Like other noble Lords, I congratulate the right reverend Prelate the Bishop of Bath and Wells on a truly excellent maiden speech. I pay tribute to the noble Lord, Lord Grenfell, for his excellent chairmanship of the European Union Committee and I welcome in his place the noble Lord, Lord Roper, who took over his responsibilities yesterday.

As my noble friend Lord Howell said, I shall concentrate on the defence aspects of this debate. I am sorry that time precludes me from speaking on some very important issues that I should like to have addressed, particularly Zimbabwe, on which we heard eloquent speeches from the noble Baroness, Lady D’Souza, and my noble friend Lord Blaker. I congratulate him on his persistence on Zimbabwe issue. I listened intently to the right reverend Prelate the Bishop of Winchester

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on the Democratic Republic of Congo, and on Gaza/Israel, about which we heard thought-provoking speeches from my noble friend Lord Steinberg and the noble Lord, Lord Ahmed.

Over the past year I have been privileged to meet many service men and women from all three services. I have met people who have suffered life-changing injuries and those who have carried out significant acts of bravery. Every one has impressed me with their outstanding ability, determination and professional manner. The whole House recognises and pays tribute on sadly frequent occasions to those who have given their lives in the course of their duties in Afghanistan and elsewhere. At this time our heartfelt sympathy goes to the families of the two Royal Marines killed in Afghanistan last week.

I also pay tribute to the key role played by the voluntary organisations and the old comrades’ associations in supporting veterans and their families. They provide financial and other assistance to the families of those killed. We on these Benches welcome John Hutton as Defence Secretary of State and we are pleased that he does not have other ministerial responsibilities impinging on his time and attention. He will have to tackle head-on some very pressing issues, not least disengagement from Iraq, increasing pressure from the United States for a significant expansion in Afghanistan, procurement issues from the pressured defence budget and the latest figures showing the Armed Forces to be nearly 6,000 under strength. Happily, we are starting to see a real groundswell in public support for our Armed Forces, exemplified by the crowds that turned out in their thousands to support them and their families, the Royal British Poppy Appeal and the Help for Heroes campaign.

Many speakers mentioned Afghanistan. We agree with the Minister that we must be resolute. Abandoning Afghanistan is not an option. If we do not go to the Taliban, they will come to us. I share the welcome given by the noble Lord, Lord Owen, to effective French involvement. Yesterday, the Prime Minister announced in the other place that a review of our mission in Afghanistan will take place. We await the result with great interest, particularly on whether our force size is to be increased and whether the current level of resources, including transport aircraft and helicopters, is sufficient.

However, it is clear that something must be done about the Afghan Government’s rampant corruption. Many returning members of the Armed Forces take this issue up with me. They ask what cause their colleagues are dying for as they see the Afghan Government spending their time lining their pockets. We are annually putting £1.6 billion in aid into Afghanistan and apparently less than 4 per cent of it works through the system to ground level, largely due to corruption. It is outrageous that so little of our taxes go to improve the lives of ordinary Afghans. Far too much goes on luxuries such as cars and houses for Afghanistan’s new rich. DfID must urgently redirect its policy on this.

We on these Benches welcome the Government’s support for NATO, which was mentioned in the Queen’s Speech. There are members—not least this country—who

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are doing a disproportionate amount of the funding, the fighting and, consequently, the dying. This is simply not sustainable in the longer term. For NATO to work properly as a security alliance, members need to understand that membership brings implicit and explicit responsibilities to ensure that their militaries have the capability and the will to fight and win on a modern-day battlefield.

The noble and gallant Lord, Lord Bramall, stressed the importance of a joined-up approach in Afghanistan by the FCO, DfID and the MoD, and also mentioned the air bridge. I know how much the Minister is aware of this problem and how much she is doing behind the scenes to try to resolve it. I do not often see the service personnel whom I meet get really angry, but their anger is palpable at the seemingly endless, and entirely unacceptable, delays in getting them home to their families via the air bridge. To them, the shortcomings of this essential service seem to reflect complacent indifference on the part of those responsible. It is essential that all those responsible within the Armed Forces, the MoD and the Government as a whole act on an issue that is enormously damaging to morale. Can the Minister say something about the issue raised by the noble Lord, Lord Gilbert, of how the Government intend to plug the gap in strategic airlift capability caused not least by the delays to the A400M programme? As the noble Lord pointed out, this matters because the existing fleet of C130Ks is on its last legs and the Js and the C17s are being pushed to the limit by high-altitude flying. I share the noble Lord’s enthusiasm for the C17.

My noble friend Lord James was rightly concerned at the shortage of helicopters. He made the point that we are operating 14 different models as personnel carriers, which is ruinously inefficient for spares and maintenance rotation. He asked whether we should consider using civilian craft when the threat from increasingly sophisticated IEDs has grown and fewer than one in three of the Army’s Apache attack helicopters is fit for purpose for front-line operations or for the training of pilots in Britain. That helicopter is so essential to the mission in Helmand that troops rarely venture out on long-scale operations without its support. I hope that the Minister will urgently consider that issue.

We agree with the noble Baroness that real progress has been made in Iraq. I look forward to the noble Lord saying more on the timescale for withdrawal, as raised by the noble Baroness, Lady Northover, and the long-term defence relationship and the training aspects, mentioned by my noble friend Lord Howell.

Naval power, one of the most useful, flexible and historically successful arms of the state, continues to be run down with cavalier disregard for our total dependence on sea trade. As my noble friend Lord Selsdon said, the cold fact is that without sea trade, we would have little food, fuel, or goods. The Gulf of Aden is a vital pinch point in sea routes from the east, so we are very disappointed that the much trumpeted transport Bill to address the piracy problem off Somalia was not in the Queen’s Speech.

Senior naval officers are itching to deal with the dangerously underrated problem of Somali waters. They say that deterrence would not be too difficult

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with trained crews, fast ships and a clear mandate. In the mean time, we must not let antipiracy operations be hampered by multiple commands and institutions. Whitehall appears to be absurdly concerned with the pirates’ human rights.

The Minister mentioned UORs. I join her in paying tribute to the commitment and responsiveness of defence companies in reacting to UORs. Publication of the equipment review is expected before Parliament rises for Christmas. Can the noble Lord tell us when it is expected? It appears that the defence industry will not benefit from the fiscal stimulus package announced in the Pre-Budget Report. That oversight is very disappointing given the contribution that the industry will make to the UK’s economic recovery. The aerospace and defence sectors employ about 124,000 people in this country. I understand that Britain's defence companies have warned the Government that cutting projects jeopardises the country's reputation as a serious military power. We do not want to find ourselves in five or 10 years’ time unable to play a role in the world because we did not invest today.

It is sadly apparent that the Government have provided only grudgingly, at best, essential support for our Armed Forces to fulfil the tasks that they are sent to undertake on our behalf. It is therefore very welcome that my right honourable friend David Cameron, in a recent open letter to members of the Conservative Party, explicitly listed as the fourth of his six policy priorities his determination to offer our Armed Forces the support that they deserve.

6.28 pm

The Minister of State, Foreign and Commonwealth Office (Lord Malloch-Brown): My Lords, it is a great honour for a second year running to respond to this debate on Her gracious Majesty's Address to Parliament. I join those who have congratulated the right reverend Prelate the Bishop of Bath and Wells on his marvellous maiden speech. We look forward to many future contributions from him.

Let me immediately address the complaint of several noble Lords that there were absences in the gracious Speech—insufficient or no references, it was said, to Africa or to poverty, or even to climate change, it was suggested in one case, which in fact is addressed in the Speech. In the first sentence of the Speech, the word “global” appears. It appears because the philosophy of the Speech is very similar to the one which the noble Lord, Lord Ashdown, stated today: everything is global today. The theme of the Speech was a stripped-down emergency response to a financial crisis at home, generated by global conditions. In the vision of the Speech is the intention to respond globally to this crisis.

In that regard, I know that I speak for my right honourable friend the Prime Minister and all of us in government when I say that we imagine the G20 summit, to be held here at the beginning of April, to be an opportunity not only to take steps to reform the markets but to take concerted, co-ordinated action to protect global jobs and growth worldwide, not only in the G20 economies. We need to find ways to reach beyond that and include the poorer developing countries as well. Although the Speech was, as I said, a deliberately

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stripped-down speech that focused on the crisis faced here and around the world, it was intended to be a very global speech that acknowledges our mutual interdependence. Our economies and our prosperity are interlinked.

I completely concur with those who have commented on the changed mood of our meeting today compared with last year. Last year, we spoke a lot about globalisation and the shift of power to Asia—a theme of which the noble Lord, Lord Howell, frequently and importantly reminds us. There was a more ominous tone to this discussion today—a recognition that the shift of power brings with it dramatic risk, which has been accelerated by this crisis. That risk may well mean not only that power shifts more rapidly than we had foreseen, as countries that are in surplus in a sense benefit relatively during this period of turmoil, but that the turmoil and the turbulence may not necessarily be simply a short-term matter of economies stabilising—they may reflect the fact that our world has entered into an altogether more dangerous time.

I was therefore relieved to be able to clutch at a few straws of continuity. I was delighted that the right reverend Prelate the Bishop of Winchester once more set me a very difficult set of exam questions on the DRC. I fear that I may not be able to answer them all today for lack of time. Like everyone else in this House, I commend his complete moral dedication to this and the fact that he keeps it before us, and I will try to respond as much as I can today and more fully thereafter.

I was also absolutely delighted that proof that the world does not change came in the shape of a former FCO PUS, the noble Lord, Lord Jay, who gave me seven pieces of what he described as advice but which, as a junior Minister, I know to be instructions. They are well taken.

The other great theme that many noble Lords raised was that, despite the dark clouds that hang heavily over us in many senses at the moment, there is one astonishing beacon of light—the election of Barack Obama to the US presidency. It has energised the world, but it is much more than the remarkable and perhaps ultimately impossible expectations that people have vested in this individual; it is an astonishing tribute to the United States and its people after a very difficult campaign. As noble Lords have said in the Chamber tonight, he was accused of all sorts of things and was misrepresented in ugly ways on the internet by bloggers and others. People had confidence in this new and relatively untested figure, who came through an extraordinary route to the presidency, and gave him this mandate. That speaks not only to Barack Obama but to the men and women—the voters—of the United States. So many of us in this Chamber have said over recent years that we hope to see America leading again on the values of liberty, human rights and multilateralism around the world, for which it has always been so important. In that regard, I have no difficulty in confirming to my noble friend Lord Gilbert my extraordinary respect for the United States. Perhaps I may suggest to him that he is better on planes than he is on Ministers, because I have no doubt in acknowledging the very special relationship that the United Kingdom must have with the United States.



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Iraq was addressed at some length, very comprehensively and well by my noble friend Lady Taylor when she opened this debate. Let us be clear: as everyone has acknowledged today, there has been a strong improvement in the situation in Iraq, as regards both our own mission and, more importantly, its political and security situations. The surge has paid off in ways which even a year ago many did not foresee. As to when our mission will be complete and when we will leave, it is impossible at this stage to offer dates, particularly as negotiations are under way on governing future arrangements between ourselves and the Iraqi Government to follow on the US negotiation of its status of forces arrangements. As the Prime Minister has indicated, we very much expect that we are now far advanced in the process of moving to a much more normal, bilateral defence relationship where we can provide support of different kinds but are not actively engaged in the internal security arrangements of Iraq. The political and economic progress made in Basra and elsewhere is a tribute to what our soldiers and others who have served there have been able to do in recent years.

Our involvement in Afghanistan is not at a point where we can say that the problems are behind us. Very challenging problems are still ahead. The noble Lord, Lord Ashdown, and others spoke of the lessons of history. The noble and gallant Lord, Lord Bramall, spoke of the complexities of the mission and the need to make sure that, across our development, foreign affairs as well as defence activities remain truly tied together. It was very much with that in mind that the Prime Minister made the announcement yesterday in the Commons. We recognise that these efforts must work together.

We have always recognised that this is a political as well as a military effort and that there is a solution only if military pressure can create the conditions for a successful process of political reconciliation. I acknowledge the point made by the noble Lord, Lord Avebury, that often political reconciliation may in our minds be too limited as just a matter of winning over tribal leaders and those who are not committed to the ideologies of the Taliban, and that we need to do a better job of understanding the ideological dimensions of what is happening in Afghanistan.

A number of noble Lords, including the noble Lord, Lord Owen, referred to the situation in Pakistan. While a great focus is put on the review under way by General Petraeus for President-elect Obama on American strategy in Afghanistan and there is much speculation that it may involve a surge, at least as significant a contribution of that work will be to point out that you cannot solve the problem of Afghanistan without addressing the problems of Pakistan as well. For too long, as many have argued today and previously in this Chamber, there has been a bifurcated approach where there has not been sufficient attention to the very serious difficulties that Pakistan faces. There has been the extraordinary triumph over the tragic circumstances of the assassination of Benazir Bhutto. Elections were able to proceed. A democratic Government have come to power, but we see them challenged by a very difficult economic situation with high inflation in the economy and high food prices.



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We see also a challenge to civilian democratic rule in relations with the military. Without wanting to speculate too much on what happened in Mumbai, I regret that I cannot be quite as sanguine as my noble friend Lord Ahmed that we should wait to see what evidence is produced. Already at this stage one has to acknowledge that there was clear involvement on the part of not—I repeat, not—the Pakistan Government but of groups based in Pakistan. That poses a challenge to the Pakistani authorities, civilian and military, to make sure that they fully co-operate with the Indians in the investigation of these acts, and if necessary in the turning over of suspects to meet justice in India’s courts. Many of us can recall the near-war situation that arose in 2002 when a similar terrorist incident was not followed by necessary co-operation between the two Governments.

I turn to the Middle East, a subject that the noble Lord, Lord Dykes, knows I approach with some trepidation because I will never satisfy him. I recognise the validity of his point—that on the last occasion we debated these issues we were perhaps not able to offer sufficient in the way of a new response to his challenges and those of his colleagues. In that regard, the recent visit of the Foreign Secretary to the region merits attention. It is not just that he visited Syria, but that he was able to advocate strongly support for the Arab peace initiative. He was able to press very strongly both publicly and in private for the end of the humanitarian siege of Gaza and for supplies to be allowed in. He also pressed on making sure that illegal settlements are not the source of exports through trade agreements to the UK or to Europe. I hope that it is clear that he showed an even-handedness of approach that was intended on his part to try to fill the gap as one American Administration leaves office and another comes in. He was able to demonstrate some UK leadership on these issues.

There is no escaping the appalling humanitarian situation in Gaza, about which my noble friend Lord Ahmed was able to give us a first-hand account, and which the noble Lords, Lord Steel and Lord Wright—or as we now know him, “Lord Wright of”—reminded us about. The final plea made by the noble Lord, Lord Wright, for talks is one that I am sure is a theme that President-elect Obama will have in mind as he puts in place a team to move forward.

I want to say a word about Iran, which did not get much mention today. I shall say again that I think we all agree that there is an offer on the table to Iran, and more importantly there is now the clear intention of a new Administration in Washington similarly to take a fresh look at these issues and work out how to move forward effectively and successfully in curbing Iran’s nuclear ambitions while giving the country a sense of its own security, and thus allow it to progress, because progress so far has frustratingly eluded us.

Brief mention was made of nuclear issues and it is worth recording that the cluster munitions treaty, which is so important to many noble Lords, was just yesterday signed in Oslo by the Foreign Secretary.


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