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In opening the debate, the noble Lord, Lord Howell, whose appointment has been widely welcomed, given his great experience of many aspects of foreign policy, recognised the extensiveness of the dangers that we face in the world today. We heard from him a long list of interests and concerns, which have been echoed and magnified throughout the debate. We heard about natural disasters, poverty, malnutrition, the exploitation

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of the less well off, the threats of disease, uncontrolled population growth, the settlement of disputes by force rather than according to the edicts or prescriptions of public international law and the lack of certainty about what the rules of public international law are or ought to be on the use of force in humanitarian crises. We also heard about the violation of human rights and many other matters. All these things require us to focus as a nation on what our priorities must be.

Never has that been truer than at the moment, when our economic weaknesses have been displayed in a humiliating fashion. We must intervene effectively in the global issues that have been discussed. We should not underestimate our capacity, but we have to be realistic about our capabilities and not exaggerate what we can effect beneficently.

I hope that the words of the noble Lord, Lord Owen, on the Strategic Defence Review will be listened to. He has always been concerned about that aspect of our national interest. He made the important recommendation that the review should be far-reaching. He said that we should not accept any limitation on the commitments that we can afford and those that we cannot afford and that we should consider what makes most sense.

I want to speak in particular about the European Union, because I do not entirely accept what the noble Lord, Lord Owen, said about the danger of being locked into the EU strategically. I argue that our capacity for influencing the issues that have been raised in this debate will be immensely strengthened if the European Union speaks with one voice. As the noble Lord, Lord Eatwell, pointed out, we should not differentiate ourselves from and hold at arm's length the economic problems of the eurozone. We must recognise that those problems impact directly on this country. The fact that we did not join the euro has, if anything, diminished our capacity to avoid the crisis and has to some extent weakened our voice in coming to grips with it. We must not for a moment stand back in a vain-in both senses of the word-attempt to proclaim a superiority that we certainly do not merit.

If the European Union is not embroiling and entangling us, but making a serious contribution to such matters as climate change, on which it conspicuously failed to make any significant impact in the outcome of the Copenhagen conference, there is a lesson for us. Our voice and interests-what has been referred to as our international network of historic contacts in the Commonwealth and other alliances-will be amplified immensely if we can come together with the European Union. If we recognise the limitations of our diplomatic capacity, which are reflected to some extent in the cuts that have been made in the departmental spending of our Foreign and Commonwealth Office, let us welcome the setting up of the External Action Service. Let us back that, where we can, with a political attempt to bring together the understanding of the member countries of the European Union, and utilise our connections and theirs-many of them also have colonial and imperial links-so that we can play a part in settling international disputes and holding risks and terrors at bay by exercising the weight that the European Union's state of development really does require of us.

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9.41 pm

Baroness Taylor of Bolton: My Lords, I start by paying tribute to those in our Armed Forces who do so much to command our admiration and respect. I pay particular tribute to those serving in Afghanistan and, most of all, those who have made the ultimate sacrifice on our behalf. We must never forget them, or indeed their families.

Several people have commented that debates in this House on foreign affairs and defence are always extremely wide-ranging, knowledgeable and-speaking from experience-very challenging for the Minister, who aims to reply to the many and varied points that have inevitably been raised. It is, I must acknowledge, an almost impossible task. I congratulate the noble Lord, Lord Astor, on his appointment; I welcome him and wish him well in the future. I also thank him and the House for the tolerance and assistance that I received when I was in his place at that Dispatch Box. We will continue to have differences of opinion but I think our objectives, particularly in foreign affairs and defence, are the same. We may disagree on the means, but our objectives are to promote national security and our national interests. The good will that should go with that common objective should see us through some of the disagreements that we will have.

It is right that I should start with Afghanistan, an area that has such a high priority in the Ministry of Defence because of operations. Mention has already been made in today's debate of the recent visit by the new Secretary of State for Defence and the Secretary of State for International Development. As has been mentioned, that visit seems to have led to some confusion about whether we need to redefine or clarify our roles. That was not a particularly auspicious start. I hope that the Minister this evening will ensure that he clarifies exactly what happened and, perhaps more importantly, will use his good influence to make sure that stories like that do not appear again. It cannot be in anyone's interests-ours, those of our Armed Forces, or those of the people in Afghanistan-if the Government send out mixed messages about our mission there.

I said repeatedly in government, and will continue to say in opposition, that we are in Afghanistan for the sake of the security of people here in the United Kingdom. The danger of Afghanistan once again becoming a safe haven for terrorists is very real and it is not just the UK that believes that. We are there under successive UN resolutions and with more than 40 other countries. We will achieve our objective partly by beating the insurgents and partly, and essentially, by creating the conditions for stable government and development to be established. Some may try to divide these objectives but we have to get Afghanistan into a position where it is no longer a threat to us in the long term. That is the challenge that we face.

I have seen the Statement by the Secretary of State today-I was grateful to the noble Lord, Lord Astor, for sight of that-and I am glad to say that I did not detect a new strategy there. I am pleased about that because we need to consolidate and build on the progress that we are making. We have to be clear that Afghanistan has been challenging to all of us all through. It will continue to be challenging and it is not a static situation. One of the frustrations of being a

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Minister in the Ministry of Defence is the simplicity with which some in the press seem to present complex issues.

I noticed that during his visit the Secretary of State made some general but rather sweeping statements about equipment. Indeed, my noble friend Lady Dean pointed out that he made a general statement about operational allowances. I give a friendly word of caution that we will be looking at all the details that will come from this. There are no panaceas, easy solutions or decisions that can be made at one time which will see you through the whole of the rest of that situation. We are fighting an insurgency where there are ever changing tactics and challenges and we have to work very hard indeed to be able to retain the upper hand and make the progress that we want. We cannot always anticipate what the next priority will be, so Ministers are wise to be cautious about any solutions which are offered.

I wish to say a few words about the Strategic Defence Review. A lot of work has already gone on in preparation for this, but I should like to make a few points. I was interested in what the noble Lord, Lord Owen, and others said, much of which could be very constructive in terms of the way forward. I hope that the SDR-or the defence and security review, whatever we call it-will be policy-driven and not cost-driven because otherwise I do not believe that we can get the right answers. What we do in defence is based on our view of the world and the threats that we perceive exist out there which could be damaging to us. It is about our security and our foreign policy and it has to involve the whole of government.

The Green Paper Adaptability and Partnership, which we published in February this year, was well received on all sides of the House. Its analysis of global trends and its questions about the role that the UK must play to protect our interests is a very good basis on which to conduct the review. I am not pretending that affordability is not an issue though I remind the House that we have just seen, under Labour, the longest period of sustained real-terms growth in the defence budget for decades, and that is before we add the Treasury money that has come from the reserves for operations. What I am saying is that policy must be determined by threat analysis and then we must work out how we counter those threats, what we can do alone, what we have to do with others and in what circumstances. We cannot just say, "This is the equipment we have or we want, and so this is what we will do". When I was in the MoD, I said that the SDR had to be policy-driven, and I say it again.

However, on a slightly different matter, I hope that it will be possible for the Government to continue what was started with the Green Paper-namely, to widen the debate-because these issues are important and deserve widespread consideration. The work of the Defence Advisory Forum, set up during the construction of the Green Paper, was extremely useful, and the themes in that Green Paper, including adaptability and partnership, will stand everyone in good stead when they are looking to the future and to the review.

I mentioned affordability and I want to say a few words about equipment procurement as a process. There is no doubt that a great deal of work has been done to improve procurement processes within the

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Ministry of Defence. There is also no doubt that the National Audit Office will still produce reports that are critical of certain projects for being over time and over budget. Some, although by no means all, of that criticism will have some justification. However, some developments within the MoD in the past few years have been helpful and we should build on them. The move to through-life capability management has been a good thing and must be developed further. There is still some way to go, but some progress has been made in terms of thinking about capabilities rather than platforms. Not everyone is totally sold on that idea, but it is there to stay and should be built on. There is greater scope not just for open architecture in design-with the concept of "fitted for", not "fitted with"-but generally for a more incremental approach to procurement. All these, together with what we learnt from the very successful urgent operational requirement procedures, mean that we can move forward. I should be interested to know what the Government's line will be on the commitment to transparency which the Labour Government gave in terms of future defence procurement plans.

However, I have one concern which I wish to share with the Minister at an early stage. I sometimes thought that if a project had enough noughts on the end of it, it was safe and could not be touched, but that projects with small-scale budgets were all too vulnerable. If we are to look at everything that is costly, we need also to look at some of the big projects.

While on the subject of small-scale budgets, I want to make a plea for proper consideration and priority to be given to what is generally called soft power. This area will be increasingly important, and we will pay a very heavy price in terms of all our interests if we neglect it. Future threats are not predictable. They may come from terrorism, failing states or, indeed, international crime. What we can assess, and what we said in the Green Paper, is that they are most likely to involve distant places, asymmetrical methods, complex political situations and complex security environments. The situation we face will be ever changing and ever challenging. Moreover, personally, I think that the public threshold for military intervention will be even higher. Therefore, we need even greater emphasis on conflict prevention and security promotion-which means soft power. It must be a mainstream part of defence activity, but we actually spend less than 0.5 per cent of our defence budget in this area. We get a tremendous return for it in terms of influence throughout the world, but soft power is so important and has so much potential that we would do well to consider what more we can do in this area. It is not a substitute for hard power-they complement each other-but we must ensure that we give soft power sufficient priority in the future.

Finally, I must say that it was a great experience to work within the Ministry of Defence, with so many professional and dedicated civilians as well as military personnel. I was also proud to work alongside my colleagues, in particular Bob Ainsworth, who, as Armed Forces Minister and then as Secretary of State for Defence, did so much for those in the Armed Forces. The service personnel Command Paper was the first time that any Government had produced a document,

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given undertakings and done such detailed work to improve the lot of those in the Armed Forces and their families. That work made great strides forward, as did our spending, referred to by my noble friend Lady Dean, on the backlog of housing problems.

We also introduced the compensation scheme, which has been criticised and improved-but we should remember that it did not exist until a Labour Government introduced it. It was right that we made such improvements, but a little acknowledgement is perhaps in order this evening. We created a strong basis in that area for the Government to build on. I do not expect us to get all the details this evening. I do not even expect the Minister to answer all the questions that have been raised on important issues such as mental health. However, I hope that he will continue the tradition of writing to those Members whose questions he cannot answer.

Ministers have big and significant responsibilities, and there will always be new challenges. I am proud of what the Labour Government did. As the noble Baroness, Lady Royall, pointed out yesterday, we will assist this Government whenever we think that they are doing the right thing. Perhaps there will be more examples of that in foreign and defence policy than in some other areas. We will also be rigorous in holding the Government to account. We wish all Ministers well in their new responsibilities.

9.56 pm

The Parliamentary Under-Secretary of State, Ministry of Defence (Lord Astor of Hever): My Lords, it gives me great pleasure to close this excellent debate-my first as Under-Secretary of State for Defence in this House. This is a huge honour. Noble Lords should have no doubt that I, as a former soldier, will do my utmost to support the Armed Forces from all services. I am always ready to listen to the advice from defence experts-which this House has in abundance-that has been offered to me by noble, and noble and gallant, Lords from all parts of the House during my six years as shadow Defence Minister. My doors are open to all noble Lords from all quarters of the House. I particularly look forward to working with the noble Baroness, Lady Dean, and with my noble friend Lord Lyell, who ran the All-Party Defence Group so efficiently.

I am sure that I speak for the whole House in also recognising the exceptional job at our Armed Forces do, wherever they are in the world, on behalf of our nation. Tragically, our people sometimes make the ultimate sacrifice. Tonight, I humbly offer the condolences of the whole House to the family and friends of Corporal Stephen Walker from 40 Commando Royal Marines, serving as part of Combined Force Sangin, who was killed in an explosion on 21 May. Corporal Walker was conducting a joint foot patrol with the Afghan National Army to reassure, and improve security for, the local population. It is also with great sadness that I report that a soldier from 4th Regiment Royal Artillery was killed this morning in Afghanistan.

I will say something about the noble Baroness, Lady Taylor of Bolton. She left office with the admiration of the whole House, and has served this country well

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over many years. I have always admired her wealth of experience and her ability to make the most complicated issues accessible to all noble Lords. The noble Baroness will be a very hard act to follow. I also pay tribute to the noble Lord, Lord Drayson, for the innovations that he brought to equipping and supporting our Armed Forces. I also pay tribute to the noble Lord, Lord Tunnicliffe, who often stood in for defence Ministers at the Dispatch Box and did a very good job, as did my noble friend Lord Lee of Trafford, formerly the Liberal Democrat defence spokesman. I was always full of admiration for my noble friend and he always seemed to ask the questions that I wished I had thought of.

Finally, I am sure that the whole House will want to join me in wishing Black Rod well after his recent stroke. He took a great interest in defence issues in this House, and I know that he would have wanted to be here for a lot of today's debate.

I should like to focus on Afghanistan and our plans for a much needed Strategic Defence and Security Review. We are in Afghanistan out of necessity, not choice. Let us be clear: our mission in Afghanistan is vital for our national security; it is vital for the security of the region as a whole; and it is vital for global stability. It was in Afghanistan that the attacks of 9/11 were planned. We must not allow Afghanistan to be used again as a safe haven for terrorists or a launch pad for attacks on this country or those of our allies. Earlier today, as the noble Baroness, Lady Taylor, said, I laid a Written Ministerial Statement before this House, which sets out recent changes to the command arrangements to enable ISAF to make optimal use of the increased forces now deploying in southern Afghanistan. As the noble Baroness, Lady Taylor, said, the international coalition has a mandate from the United Nations, and 46 different countries are now providing forces.

As the Foreign Secretary has set out in the other place, our national objective in Afghanistan is to help Afghans to reach the point where they can look after their own security without presenting a danger to the rest of the world. Therein lies their security and ours. That is why the counterinsurgency strategy devised by General McChrystal last year is rightly focused on the Afghan people. Over the past two years, the authority of the Afghan Government has been extended from six to 11 of the 13 provinces in Helmand.

The training that the Afghan security forces are receiving will, over time, enable the transition of lead security responsibility from NATO's mission to the Government of Afghanistan, starting in some parts of the country at the end of this year or early next year. This is part of a wider political strategy, including anti-corruption measures, improvements in governance and economic development, that will then allow us to bring our forces home. The Government remain committed to doing so as quickly as possible, but only when the time is right and not to some arbitrary deadline. To achieve this, the Government of Afghanistan as a whole must have the capacity to maintain a more stable and safer state. The Afghan national security forces must be able to stand firm on their own against the enemies of their Government. That means building the capabilities and confidence of the Afghan Government

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at a national and local level to bring leadership. That is where our comprehensive approach can be applied most effectively. By drawing on the skills across government, such as political understanding, reconciliation and development, a comprehensive approach is able to offer a more tailored response to the complex problems in Afghanistan. One thing is certain. Through their courage and bravery, our Armed Forces have dealt a severe blow to the Taliban-led insurgents and the terrorist networks supporting them.

I now turn to the Government's defence policy. My noble friend Lord Howell opened this debate with an explanation of the underpinning of the active, hard-headed and practical foreign and security policy that the new Government will implement. This is the dawn of a new era for our defence policy. It is about acting in Britain's national interest to shape the world, not just be shaped by it. The security environment can change rapidly. I have already mentioned that we face an increasingly diverse range of global security challenges. Keeping al-Qaeda out of Afghanistan is just one part of the campaign against international terrorism. Working closely with the Government of Pakistan to tackle extremism and its underlying causes in the border regions is another. We face many enduring and emerging threats. Iran and North Korea are examples of the former and cyber warfare is an example of a threat that is only now emerging. That is why the priority for our defence policy will be the strategic defence and security review.

As the noble Baroness agreed, defence cannot be immune from the economic realities that we as a country face. The noble Lord, Lord Owen, said that we face difficulties. All defence programmes, including equipment, will need to demonstrate their value for money, but we should use the difficult challenges to grasp the opportunity of radical thinking and reform. Let me reassure noble Lords that the SDSR will be a strategic, cross-government and comprehensive exercise overseen by the newly formed National Security Council to provide a coherent approach to security. We have to ensure that we have the right balance of resources to meet our commitments so that our service men and women have what they need to do what we ask of them. As a nation we have a responsibility to give our Armed Forces our full support in return for the selfless service and sacrifice they are prepared to make in our name.

Our objective is to double the operational allowance of those serving in Afghanistan and we are discussing how rest and recuperation leave can be maximised. We place great emphasis on giving a high priority to anyone suffering from enduring health problems as a result of service, particularly those with serious injuries and mental health problems. We will deal with the invisible wounds of war as well as the visible ones. We must make sure that every penny spent on defence counts.

I shall turn to some of the questions asked today. Some very important issues have been raised and there is no way that I can answer all of them, but both myself and my noble friend Lord Howell will do our very best. The noble Baroness, Lady Kinnock, asked about our commitment to spend 0.7 per cent on

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development aid. This Government are fully committed to achieving from 2013 the UN target of spending 0.7 per cent of GNI on overseas aid and we will enshrine this commitment in law. That was made clear in last week's coalition agreement. Locking in our commitment on aid is both morally right and in our national interest. It will place our country in a position of clear international leadership and we will encourage other countries to live up to their commitment. Value for money will be central to everything that we do. DfID will use the power of independent evaluation, transparency and a focus on results to drive a step change in the effectiveness of the UK's aid efforts.

The noble Baroness, Lady Symons, asked about aid to China. DfID's bilateral trade programme is planned to end by March next year and we will review which other countries should get UK aid and focus more on the poorest.

I can confirm to the noble Baroness that my noble friend Lady Verma is the international development spokeswoman in this House. I can also confirm that French co-operation has not disappeared. At the risk of disappointing the noble Lord, Lord Gilbert, interesting discussions are taking place at a very high level with our French friends. I have some good news for the noble Lord, Lord Gilbert: the seventh C17 will go ahead with an in-service date of March next year.

The noble Baroness also asked me about NATO. Of course, NATO is the cornerstone of our defence policy. My noble friend Lord Lee asked me when the 25 per cent reduction in MoD running costs will be achieved. We are committed to that reduction and work is ongoing on how it will be implemented. With regard to Trident, the Government remain committed to the maintenance of the nuclear deterrent. However, as announced by the Prime Minister and the Deputy Prime Minister, that will be scrutinised for value for money.

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