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Sri Lanka


3.30 pm

Asked By Baroness Northover

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The Minister of State, Foreign and Commonwealth Office (Lord Malloch-Brown): My Lords, my right honourable friend the Prime Minister telephoned President Rajapaksa on 20 April to call for a renewed pause in fighting to allow civilians to leave. Since the UK first called for a ceasefire in January, the EU, the US, France and others have joined us in making similar calls. The Foreign Secretary and I remain actively engaged with our international counterparts and the United Nations in pressing for a renewed pause in the fighting.

Baroness Northover: My Lords, I thank the noble Lord for that reply. Surely the UN has a duty to protect trapped civilians in this kind of circumstance, so what more can be done to secure a ceasefire so that aid can be got in and people led to safety? Should not the alleged atrocities on both sides be subject to investigation under international humanitarian law? Unless these grievances are addressed in full, there will be no peace in Sri Lanka in the future.

Lord Malloch-Brown: My Lords, I certainly think that the UN is conscious of its responsibilities in this area. The Secretary-General dispatched his chief of staff to visit Colombo in recent days precisely to try to secure improved UN access to the civilians caught up in this fighting. Secondly, I completely agree with the noble Baroness that it is enormously important that this conflict, which has been taking place in the shadows due to the limited international presence, should be fully investigated and that, if war crimes have been committed, they should be identified.

The Lord Bishop of Portsmouth: My Lords, the Tamils are an ancient people and the conflict, which has ethnic as well as religious overtones, is not a modern one. Will the Government be as vociferous as possible in repudiating the language used by the President of Sri Lanka in describing this as a “war on terror”? Many people in this House and beyond regard that as a very unfortunate piece of modern jargon, coined by the former President of the USA.

Lord Malloch-Brown: My Lords, I share the view that “the war on terror” is a much abused and overused phrase. Obviously, this is a quarrel that has ancient roots. It is also an extremely violent quarrel, with appalling things being done by both sides.

Lord Eden of Winton: My Lords, I declare a personal interest in Sri Lanka. Is it not most important that the leaders of the LTTE call not only for a ceasefire but for an immediate halt to all suicide bombings, in so far as that lies within their control? Secondly, will the Sri Lankan Government be encouraged in talks to construct a framework that will result in a degree of autonomy for the Tamil north and to ensure that Tamils will not be excluded from employment anywhere in Sri Lanka just because they are Tamils?

Lord Malloch-Brown: My Lords, my right honourable friend the Prime Minister spoke to President Rajapaksa on Monday and asked that there be humanitarian access and a pause in hostilities. He also asked that a cross-party UK delegation be allowed to visit and is dispatching a DfID Minister tomorrow to assess the humanitarian situation. As he said in another place

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today, the key to a solution is, as the noble Lord said, political. This conflict will not be ended by military means and it is extraordinarily important that, once this phase of conflict comes to an end, a comprehensive political framework is indeed put in place to ensure rights for Tamils and a degree of self-government of their own affairs.

Lord Avebury: My Lords, the Minister has referred to the conversation with President Rajapaksa twice. Just now he said that President Rajapaksa has invited an all-party parliamentary mission. Have any steps been taken to consult the leaders of the Opposition about putting together the mission so that it is ready to go when arrangements are made at that end? The Minister also mentioned the UN’s consciousness of its responsibilities. Now that 122,000 people have escaped from the no-fire zone, is it possible for UNICEF, the WHO and so on to gain access to those refugees? What steps are being taken at the UN to mobilise resources to deal with the crisis?

Lord Malloch-Brown: My Lords, the noble Lord rightly brings to our attention the immediate humanitarian situation. The events of the past few days have been hard for the UN humanitarian agencies on the ground in Sri Lanka to follow, as they have been for those of us much further away, but those events have been extraordinary, as the success of the Sri Lankan military in piercing the Tamil Tiger cordon around the civilians has led to a massive exodus of people. There is a dispute about exactly what numbers have exited and there are huge concerns about collateral damage to civilians, with potential violence by both sides. My right honourable friend Des Browne visited New York on Monday to lobby hard for a strengthened UN humanitarian and, if possible, Security Council response. As to the noble Lord’s first question, I spoke with both the Prime Minister and the Foreign Secretary this morning about what would be the appropriate arrangements to begin to identify such a cross-party delegation.

The Countess of Mar: My Lords, the Minister cannot fail to be aware of the Tamils demonstrating outside these buildings. Does he agree that it is understandable that they are anxious about what is happening to their friends and relations whom they have left behind in Sri Lanka? Will he tell the House what Her Majesty’s Government are doing to inform the leaders of the demonstrations what the Government can do—there is not an awful lot except talk—and try to reassure them that we are doing our best?

Lord Malloch-Brown: My Lords, a potential human tragedy is unfolding outside the building at the moment. A young man is now in an advanced stage of a hunger strike and we are extremely concerned about his health. We have sought through the MPs who represent significant numbers of Tamils, including some of those outside at the moment, to communicate with them. We have intensive contacts with leaders of the Tamil community and we have tried to inform them both of what we are doing and of the situation on the ground, but in this situation the interpretation of events has become highly polarised and partisan, with fundamental disagreements about what is happening on the ground in Sri Lanka.

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Industry and Exports (Financial Support) Bill

First Reading

3.38 pm

The Bill was brought from the Commons, read a first time and ordered to be printed.

Perpetuities and Accumulations Bill [HL]

Bill Main Page
Copy of the Bill
Explanatory Notes

Motion to Refer to Second Reading Committee

Moved By Baroness Royall of Blaisdon

Motion agreed.

Disabled People (JCHR Report)

Copy of the Bill

Motion to Refer to Grand Committee

Moved By Baroness Royall of Blaisdon

Motion agreed.

European Communities (Definition of Treaties) (United Nations Convention on the Rights of Persons with Disabilities) Order 2009

Motion to Refer to Grand Committee

Moved By Baroness Royall of Blaisdon

Motion agreed.

Business Rate Supplements Bill

Second Reading

3.40 pm

Moved By Baroness Andrews

The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Andrews): My Lords, over the past 10 years, we have seen the relationship between local and central government profoundly change. Long gone are the days of diktats to local government from Whitehall, and the past few years have seen a massive reduction of targets for local authorities and a recognition that they work most effectively when they work in partnership with local service providers, the third sector and business in doing what is right for their area.

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We in central government have progressively provided local authorities with the tools they need to do what is right and appropriate for their local needs and aspirations and encouraged closer understanding and working with business and enterprise in strengthening the local economy and the local community. This Bill is another power for the local authority tool kit to build stronger foundations for the future.

It is a short Bill, but it is significant. During its passage through the Commons, I am delighted to say that it received extensive debate with three evidence sessions and six scrutiny sessions during its consideration in Public Bill Committee. It has been supported in principle, even where some of the detail has been challenged. I know that noble Lords will be delighted to hear that it reaches our House in pristine condition, unamended by either government or opposition amendment. What this means is that the other House has concluded that this Bill will work, which is something that we in this House always look for. It arrives with a degree of cross-party consensus that will not only create an effective mechanism to part fund the vital Crossrail funding package in London, but will also offer opportunities for economic initiatives in other parts of the country if local authorities and businesses together want to take ideas forward. I should stress that working together is what will take those new ideas forward.

What does the Bill do? It has been welcomed because it will provide a discretionary power for local authorities to use, in consultation with local partners, to promote the economic development of their area. The Bill strikes an important balance between providing true flexibility at the local level and reassurances and safeguards for those who may be liable to pay the supplement. The idea has an authoritative history and a distinguished pedigree of consultation. Perhaps I may take a moment to explain the background and how we came to legislate for such a power.

In March 2007, Sir Michael Lyons published his inquiry into local government and stated that,

A key part of this role is to support and encourage the economic development of the local area. The inquiry identified the need for local authorities to have a greater flexibility to raise revenue to invest in their local areas. In his final report, Sir Michael concluded and recommended that a new flexibility should be introduced for local authorities to set a supplement on the current national business rate.

The inquiry also recognised the success of business improvement districts as a way for local areas to raise funds and invest in projects supported by business. I know that BIDs have many fans around the House. However, it also noted that BIDs tend to be limited to tightly defined geographical areas and to deal with short-term and specific issues, and thus do not provide a mechanism for long-term development. As we will be discussing BIDs and BRS at different stages of the Bill, perhaps I should explain for the record that business improvement districts are small-scale agreements

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between local businesses, working together to raise funds to improve their area in ways such as improved security, street cleaning and the promotion of town centres. The framework for BIDs was set out in the Local Government Act 2003 and is another example of the evolution of the relationship between national and local government. BID schemes enjoy wide cross-party support across English local authorities and more than 70 are currently in operation, a quarter of which are in London.

The Bill builds on partnership and the practical success of BIDs and is in the same vein of local authorities and businesses working together to invest in the future economic development of their communities. However, BIDs are designed to do different things. They are typically local in design, whereas the business rate supplement will function at a different spatial level and enable local authorities to invest in larger scale, longer term projects. The Bill reflects those key differences.

We responded positively to the recommendations of Michael Lyons’s report through the Budget 2007.We stated that a local government supplement has the potential to support local economic development, but we also emphasised the need to provide safeguards: first, the need to build in credible accountability to ratepayers and real protections for businesses, particularly small to medium-sized enterprises, that might be disproportionately affected.

The other context is that progress has been made since then towards regional and sub-regional working. In July 2007 the Government published their review of sub-national economic development and regeneration, which stated that BRS has the potential to be a key tool for local authorities to invest in long-term economic development with a strong local voice for businesses. It also proposed that they should be introduced—I stress this—only when they can command support from all those affected.

Following the recommendations of both the Lyons inquiry and the SNR, in October 2007, along with the Pre-Budget Report, the Government published Business Rate Supplements: A White Paper. That is the basis for the Bill; it sets out the foundations on which it is built. It strikes that balance of local flexibility with a strong voice for business and strong safeguards to protect the business community. We published guidance in January which explained how it sits alongside other partnerships between local authorities and businesses, which are designed as a package coherently to enable local leaders to work together to promote economic and social development.

I know that in the course of our short debate today many noble Lords may raise the issue of timing—why now?—pointing out, although I do not think that it needs to be pointed out, that we are in a difficult economic situation, which the Budget response today was designed to address as strongly as possible. I would argue that if the idea was timely in 2007, it is now urgent. I understand that there are concerns, but this is not another tax on business; far from it. This is about releasing investment for mutual benefit across the community. There has never been more relevant a time to plan and anticipate the better use of our future resources. The timing is right, even if it is difficult.

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The Mayor of London said recently that the introduction of this Bill was necessary despite the economic downturn. It is necessary because the future will not take care of itself. We are clearly in a unique period of global and national economic turbulence. That fact underlines the need for active government, an active public sector, to protect the poorest, to correct flaws in the market and to exert the leverage to secure a proper role in the contribution required, in partnership, from the private sector for our mutual benefit. In times such as these we need to use foresight and to plan for the future because the alternative is simply to let the recession run its course, leaving the market to devise the upturn. That will not do because the future is going to be a different country.

We are strengthening the foundations for the upturn; the Budget today was the latest step in that and the Bill is a part of it. We understand that business is facing very tough times. We have introduced a number of measures, both short and long term, to protect homes, jobs and businesses, and to help businesses through these very difficult times. I remind noble Lords—I am sure that they do not need reminding—of how we have done this across a wide variety of agency. We have secured billions of additional finance for businesses, allowing them to spread the payment of their business taxes over a longer period; we have taken measures to help improve the cash flow for small to medium-size businesses; since the November Pre-Budget Report, HMRC has agreed the deferral of more than £1.7 billion in business taxes, including deferrals in VAT, corporation tax and PAYE, which will benefit more than 96,000 businesses across the UK.

Recently, we went further. On 31 March the Chancellor announced that many business ratepayers will be able to defer the payment of 60 per cent of the increases in their rates bill due in 2009-10 over the following two years. The deferral scheme will apply where rates bills have increased as a result of the annual adjustment and the phasing out of transitional relief.

To help small businesses that have found it particularly difficult to secure loans, we have introduced the government enterprise finance guarantee, which will enable banks to provide an additional £1.3 billion of credit to SMEs that have viable business plans but cannot access normal commercial credit because of the current economic conditions. We have also introduced the working capital scheme, which will secure up to £20 billion of working capital credit lines for companies, and the capital finance scheme, a new £75 million fund to help viable small businesses with high levels of existing debt.

Taken together, all those schemes will enable viable businesses to borrow money during the credit crunch, thereby ensuring that sound businesses survive the current recession. We are rebuilding the financial system for the future in many different ways as well, not least with the Bank of England’s cuts in interest rates over the past six months, which control inflation and ease the cost of borrowing. This is real help that we are giving to struggling businesses, which has been acknowledged: John Walker, the national policy chairman

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of the Federation of Small Businesses, stated last November that many of the measures in the PBR,

We are doing this because we know that businesses need assistance to weather the storm.

These measures are designed to prepare our country for the future in terms of economic development, which is where BRS comes in. It is vital that local communities have the tools in place to enable them to invest, and BRS does just that by enabling authorities and businesses to raise additional revenue to invest in local economies.

During these difficult financial times, we cannot afford to be so risk-averse that essential investment is sidelined because of short-term concerns. There is also a risk that we retreat to a centralist position, removing local discretion and flexibility where there are tough choices to be made and failing to put in place for the future the skills and work opportunities to guarantee a strong recovery. Investing in Crossrail, for example, is a graphic illustration of faith in the future; it is essential to building on opportunity and building recovery. No doubt there will be other projects in the coming years that will do the same for different parts of the country.

We accept that local authorities are key to driving local prosperity. They set out their clear vision for economic, social and environmental development, and local area agreements are the framework for driving that prosperity. It is only right that we provide local authorities with as many tools as we can to enable them to do what they need to.

I shall set out what the Bill does, and does not, do. Clauses 1 to 3 set out who may levy the supplement and the strict conditions that we have built in about how the money raised may be used. Clauses 4 to 10 set out the details of the development of a BRS prospectus, consultation and the conditions on which a ballot may be held.

Clauses 11 to 17 explain the details relating to liability, the rates that may be charged and reliefs. Clauses 18 to 23 set out the details of the administration of BRS, such as collection and enforcement, while the remainder of the Bill to Clause 32 sets out how regulations may be used, the guidance and the ultimate power of the Secretary of State to intervene and cancel a BRS.

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