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Lord Bach: My Lords, I have to remind the House that when the European Court of Human Rights ruled on the appeal in October 2005, about three and-a-half years ago, it did not specify which prisoners should be given the vote. Indeed, the Court held that the blanket ban was unlawful, but expressly recognised that each member state had some discretion as to who should be given the vote. The Court expressly stated that it was not for it to impose on the UK full voting rights for all prisoners, but it was for the UK, through its democratically elected Parliament, to implement the judgment, taking into account its constitutional

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traditions. That is why in the second consultation paper, produced earlier this month, we set out a number of different options. Indeed, we invite noble Lords with views on this to answer the consultation.

Lord Tebbit: My Lords, is it not clear that despite the judicial imperialism, to which we are becoming accustomed, the British people have not been asked to give their view on the matter, and that the Parliament of this Kingdom has not yet been invited to give its view on this matter? The noble Lord and his colleagues are to be congratulated on resisting the judicial imperialism, of which we hear far too much.

Lord Bach: My Lords, I am tempted to thank the noble Lord. However, I will resist that temptation because we do not see this as judicial imperialism. I have to say that the judgment of the Court could just as easily have been made when the Government of which he was a distinguished member were in power, and it would have been just as necessary for them to react to it in the same way.

Lord Grocott: My Lords, whether or not prisoners have the right to vote in European elections, is it not worth reflecting on a broader note? Of those who have the right to vote in European elections, a substantial majority do not bother to exercise it. Is not one of the reasons for this that elections to the European Parliament are conducted on the basis of proportional representation, a system that removes the relationship between the elected and the electors? Would it not be wise to take a lesson from recent history, that the best system for European and any other elections in this country is that of first past the post?

Lord Bach: My Lords, I have waited for this moment for some time: to be able to say to my noble friend, my ex-Chief Whip, that his question is slightly wide of the Question to which I originally responded.

Conflict Prevention Operations


3 pm

Asked By Lord Hannay of Chiswick

The Minister of State, Foreign and Commonwealth Office (Lord Malloch-Brown): My Lords, the process of prioritising conflict resources for 2009-10 has involved difficult decisions. We cannot fund all activity to the same level as in previous years, including civilian secondees. However, rigorous prioritisation and the additional £71 million of departmental resources have allowed us to maintain our significant contribution to international peacekeeping and to fund priority conflict prevention and stabilisation activity. We will keep the allocation under review to ensure that it focuses on the highest priority areas.

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Lord Hannay of Chiswick: My Lords, I thank the noble Lord for that somewhat discouraging reply. Is it not the case that not only are the Government not restoring any of the cuts that they are making, but that, if you read the Written Statement given to this House and the other place on 25 March, you see that in the event of assessed contributions—that is, legally enforceable contributions to UN operations—increasing, or the exchange rate falling again, this discretionary spending on civilian peacekeeping will be further squeezed? Is this not the worst possible time for the British Government to be cutting their contribution to these programmes? Does that not set an appalling precedent for other major donors?

Lord Malloch-Brown: My Lords, we probably all share the noble Lord’s concern. Since he first raised this matter in a letter to the Financial Times with others of his colleagues in this House, we were able through great efforts by three departments—the Department for International Development, the Ministry of Defence and the Foreign Office—to add £71 million to our total peacekeeping budget. This year it will stand at £627 million as against just under £560 million last year, so we have increased the resources. The difficulty, as the noble Lord indicated, is that the assessed contributions—the UN and other operations for which we pay a fixed proportion of the cost—have increased because the number of those operations has grown.

Lord Astor of Hever: My Lords, the Minister mentioned the Ministry of Defence. Does he agree that the Armed Forces are now so stretched by current operations that they are unable simultaneously to perform the peacekeeping roles that they have so successfully performed in the past?

Lord Malloch-Brown: My Lords, the UN-mandated peacekeeping operations, OSCE operations and others involve quite small numbers of UK forces. We therefore very much hope that we will be able to hold our own and remain involved with both military advisers and civilian expertise where required.

Lord Wallace of Saltaire: My Lords, does the Minister accept that this is just one of a series of notifications that we have had in recent months about squeezes on defence spending and further squeezes on the Foreign Office budget? It is now clear that, whoever wins the next election, there will have to be some fundamental thinking about how much we spend on foreign policy, defence and overseas aid and how that money is distributed. Some of us are old enough to remember the painful all-party commissions on that subject in the 1960s. Would it not be sensible for the Government to invite the other parties to support an all-party review of how much we spend on what, ready for whoever comes into office after the next election?

Lord Malloch-Brown: My Lords, I suggest that one of the noble Lord’s colleagues asks that question of the Chancellor in the other House. If we believe what we read in the newspapers this week, all government spending will be squeezed significantly; that is a cost of the recession and the necessary response to it. However, I point out to noble Lords that on this issue

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we have increased our spending by £71 million precisely because we share the concern of many here that we must try to maintain our role in peacebuilding and conflict prevention.

Baroness Amos: My Lords, on the reality behind those figures, what impact will this have in Liberia, which I visited recently on behalf of the FCO, where I saw for myself the important work of peacekeepers in bringing a degree of security and stability to a country which is still feeling the impact of the ravages of civil war, and where theft and violence, particularly sexual violence, are a reality of daily life for many of its citizens?

Lord Malloch-Brown: My Lords, I do not have the exact figures for Liberia. However, in Sierra Leone, which I visited recently and which has had a major UK programme, there are real costs, as there are in Ghana. Overall, we will see a reduction of something like £45 million in our conflict prevention and peacebuilding spending in Africa. I stress that there is an enlarged envelope, but peacekeeping operations such as those in Darfur are now reaching full deployment and the costs of those assessed contributions are squeezing out the funds available for discretionary ones.

Baroness O'Cathain: My Lords, are other countries playing their role? There is no doubt that the British Government are doing an enormous amount in all these areas, and have a high reputation in that regard, but the perception is that, proportionately, other major economies are not doing anything like what we are doing. Can we put pressure on them to pay up?

Lord Malloch-Brown: My Lords, the noble Baroness will have noticed that at the G20 summit the UK pressed heavily for other countries to meet their commitments to development assistance and will do so at the forthcoming G8 summit. Our track record is without equal, at least among the G8 countries. I acknowledge the tripartisan support that has enjoyed here and in the other place. Although we carry a disproportionate part of the peacebuilding and peacekeeping burden in theatres such as Afghanistan, other European countries do proportionately much more than we do in other, much smaller operations such as the Balkans.

Arrangement of Business


3.07 pm

Lord Bassam of Brighton: My Lords, with the leave of the House, my noble friend Lord Myners will now repeat the Statement on the G20 summit made in the Commons before the Easter Recess on 2 April. Given the level of interest on the G20 summit in the House, the usual channels have agreed to extend the period of time for Back-Bench questions and answers by 10 minutes, from 20 minutes to 30 minutes. My noble friend Lord West of Spithead will then repeat the Statement on Operation Pathway.

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3.08 pm

The Financial Services Secretary to the Treasury (Lord Myners): My Lords, with the leave of the House, I will now repeat a Statement made in another place by my right honourable friend the Chancellor of the Exchequer on the G20 meeting held on 2 April. The Statement is as follows:

“Today, leaders and Finance Ministers from countries all over the world have come together in an unprecedented show of unity to take action on the greatest economic crisis of modern times. That crisis has deepened since the last G20 summit and it is now affecting the lives of people in every country. Today, we have agreed to do whatever is necessary to restore confidence and growth in our economies, to repair the financial system, to restore lending, to strengthen regulation and supervision, to rebuild trust in the financial system, to fund and reform the international financial institutions to overcome this crisis and prevent further ones, to promote international trade and reject protectionism, and, crucially, to build an inclusive, green and sustainable recovery.

There are no quick fixes, but, because of the progress that we have made today, by agreeing to work together we can help to restore confidence, save jobs and bring the world economy out of recession.

First, we agreed to deliver the scale of sustained fiscal effort necessary to restore growth. That does not mean that all countries will act in exactly the same way or at exactly the same time, but it does mean that an agreement has been made to take whatever action is necessary to restore growth. We are confident that the action agreed today will accelerate a return to trade growth.

Since the summit in Washington in the autumn, G20 countries have announced and are now implementing the greatest macroeconomic boost the world has ever seen. The combined fiscal expansion across the G20 will put an additional $5 trillion into the world economy by the end of next year. That will save or create millions of jobs across the world this year alone.

Central banks across the G20 countries are also taking exceptional action, cutting interest rates aggressively in most countries and using all levers available to put money into their economies to support growth. We have already made available significant support for individual banking systems through liquidity, recapitalisation and dealing with problem assets in line with our agreed framework for restoring lending. In all the actions to support the economy, there is a determination to ensure long-term sustainability and price stability, as well as exit strategies for Governments’ involvement in the banking sector.

The immediate cause of this crisis is a failure in the global financial sector and in global financial regulation. It is imperative that we rebuild trust and clean up the global banking system. As part of that, we must build stronger regulatory systems that support growth and serve the needs of people and business. Domestic financial regulation must be reformed to promote integrity, guard against all types of risk, discourage

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excessive risk-taking, dampen rather than amplify the effect of financial shocks and protect consumers as well as investors.

We also want a more globally consistent regulatory system. To that end, we agreed today to establish a new Financial Stability Board, with wider groups of developed and emerging countries as members, which will work together with the International Monetary Fund to spot risks and provide early warning. We also agreed to endorse and implement new tough principles on pay and compensation and to expand regulatory oversight to all systemically important financial institutions, including hedge funds.

We will also take action to protect the world’s financial system—and therefore our public finances—by cracking down on tax havens, and we note that the OECD has today published a list of countries assessed by the global forum against the international standard for the exchange of tax information.

We must give international financial institutions, such as the IMF and the World Bank, the legitimacy and the power to provide surveillance and support. It is crucial that emerging and developing economies can continue to receive the flows of capital on which they depend. Over the past few years, some 70 per cent of world economic growth has come from those economies, and we must not let them down now.

We have agreed a trebling in the resources available to the IMF, from $250 billion to $750 billion. We also support a substantial increase in lending of at least $100 billion by the multilateral development banks, including to low-income countries.

We have also agreed to support an injection of a further $250 billion into the world economy, increasing global liquidity through a greater allocation of IMF special drawing rights. These steps will provide an additional $850 billion of financing to support growth in developing and emerging countries, which will be able to continue trading with us and other G20 economies, in turn supporting global growth and employment.

Hand in hand with more resources will come reform of the IMF and the World Bank. Emerging and developing countries need to be represented too, so we agreed that the next review of IMF representation should be concluded by January 2011, while World Bank reforms must be completed by next spring.

World trade has underpinned rising prosperity for half a century, but today it is falling for the first time in 25 years, so we have agreed to support international trade as a crucial driver of growth in countries everywhere. International trade is currently being undermined by a shortfall in trade finance, on which 90 per cent of all world trade depends, so we have agreed today to make available over the next two years not $100 billion but $250 billion through G20 export credit and investment agencies. So in total, we have agreed over $1 trillion of additional support for the world economy, and this will support trade, growth and jobs.

We remain committed to reaching an ambitious and balanced conclusion of the Doha development round, as we believe that this could boost the global economy by a further $150 billion a year.

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The fifth element of the agreement today is a commitment to help the world’s developing and emerging countries. We reaffirmed our historic agreement to meet the millennium development goals and to achieve our respective pledges on aid, debt relief and development.

This action, and the decisions that we have taken today, will increase the resources available to low-income countries by $50 billion, for social protection and long-term food security, for example. We will act and do everything possible to build a fair and sustainable recovery.

We agreed also to make sure that when we support our economies, we do so in a way that also protects the environment. We will support investment in clean, innovative and resource-efficient low-carbon technologies.

We will also support those affected by the crisis by creating job opportunities and through income support measures. We will support employment by stimulating growth and investing in education, and through active labour market policies that focus on the most vulnerable.

This is a global crisis, and today there has been a global response. We will play our full part, and I commend this Statement to the House”.

That concludes my right honourable friend’s Statement.

3.17 pm

Baroness Noakes: My Lords, I thank the Minister for repeating the Statement made in another place immediately prior to the Recess. It is, of course, unusual for Statements to be repeated after the lapse of so much time, but this Statement was due to be made after this House had risen for the Recess, and we therefore agreed that the House would be better served by taking the Statement today.

The G20 leaders are now long departed, having duly praised themselves at the concluding press conferences, and we have had the intervening two and a half weeks to reflect on what the G20 meeting achieved. The G20 has barely left the headlines in the media in the past couple of weeks, but for all the wrong reasons. The behaviour of the police, at the G20 demonstrations and subsequently, has raised serious questions about the acts of individual police officers and the strategy for dealing with demonstrations.

The Minister did not repeat what the Chancellor actually said in the other place. The Minister omitted an expression of the Government’s thanks to the police for their effectiveness and professionalism. For the most part that was justified praise, but we cannot airbrush the problems away. I hope that the Minister will agree with me that it is vital that the Independent Police Complaints Commission conducts its inquiry into the death of Mr Tomlinson and into the other complaints as rapidly as possible.

The Prime Minister puffed the G20 meeting in advance as creating “a new world order” and “a new Bretton Woods”. Of course, it did nothing of the kind, and the Chancellor’s Statement had the good sense not to claim that. Nor was it an abject failure. It avoided disagreement, although this was achieved by avoiding contentious issues such as the impact of China’s trade surpluses and currency policy, and by appeasing our quarrelsome European neighbours. It

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did achieve agreement to some important things, such as reform of the World Bank and the IMF, at least in terms of direction if not yet in terms of tangible outcome. It did not seem to agree to some things which are manifestly wrong or harmful. For example, despite all the Prime Minister’s efforts to the contrary, the G20 did not advocate a further fiscal stimulus.

We are thankful that the communiqué referred specifically to the need to preserve long-term fiscal sustainability and to credible exit strategies from the measures already taken. We hope that the Chancellor has taken this to heart. The Budget later this week must not be an exercise in avoiding the truth about the country’s financiers and must recognise, as the G20 did, the need for fiscal sustainability.

One area where the G20 was disappointing was on world trade, where there was talk of remaining committed to reaching a conclusion to the Doha round but no associated actions. Can the Minister explain what this commitment means in practice? What precisely is going to happen to the Doha round and when?

More generally on trade, the communiqué reaffirms the Washington commitment to refraining from raising new trade barriers without even acknowledging that 17 of the G20 have, since last November’s meeting, raised barriers or tariffs. This commitment has been extended only to the end of 2010, which sounds like a free-for-all waiting in the wings. Can the Minister explain what the Washington commitment now amounts to?

Lastly on trade, the communiqué refers to at least $250 billion of trade finance over two years. Can the Minister say what this means in monetary terms in each of 2009 and 2010? By how much do UK exporters benefit, and is this new money or is it a reannouncement of existing commitments? The back-up documents show only $3 billion to $4 billion going into an IFC liquidity pool but what about the rest of the $250 billion? Which countries is that coming from and where will it go? How much will the UK provide?

The Statement referred to more than $1 trillion of additional support for the world economy, which was a fine headline-grabbing amount of money. Apart from trade finance, to which I have just referred, the IMF will get $500 billion in increased resources and $250 billion of special drawing rights. Was all the $500 billion new money agreed at the G20 or did it, as the Prime Minister has appeared to suggest, include $200 billion of money already pledged by Japan and the EU? How much is the UK contributing and when? Will it show up in this week’s Budget Statement? Can the Minister say how much of the $500 billion is being paid to the IMF in hard cash, and when will the IMF receive it?

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