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The Minister may say that all departments must take a little pain. That really is not so, as we all know. The cuts in the FCO at the moment amount to some £18 million. For example, there is no cut to the DfID budget of more than £178 million for China. I share that concern with the noble Baroness, Lady Morris. We were told explicitly that it was not possible to cut the budget for this year and yet budgets have been cut in the FCO for this year and potentially in a very damaging way. It is uncomfortable to hear one set of priorities announced so enthusiastically on camera and to hear another set of cuts quietly announced elsewhere.

We are promised more speeches and more cuts. I hope that the Foreign Secretary will read the speech of the noble Lord, Lord Kerr, as it was an excellent speech which I warmly support. He may want to spend a little more time in advance of making his cuts and his speeches on getting some real consistency between the two.

4.16 pm

The Minister of State, Foreign and Commonwealth Office (Lord Howell of Guildford): My Lords, I join noble Lords in thanking my noble and learned friend Lord Howe, one of our wisest Foreign Secretaries and someone whom I greatly respect, for initiating this debate and on seizing the moment. I shall turn to some of the things that he said in a moment.

I greatly enjoyed the maiden speech of my old colleague, my noble friend Lord Maples, who speaks with great expertise. He rightly focused on the need to identify and promote our national interests in this complicated world, a matter that is sometimes forgotten. I am also grateful to the noble Baroness, Lady Symons, who has just summed up from her side. I think that her broad strategic stance was supportive, although she asked many detailed questions, which I shall try to answer, although in less than 20 minutes I cannot possibly do justice to all the points that have been made in the debate.

At least one central message emerges vividly and insistently from the debate: the global landscape has changed and is changing significantly. That point was made with eloquence by my noble and learned friend Lord Howe, by the noble Lord, Lord Desai, by my noble friend Lady Williams, by the noble Baroness, Lady Taylor, and by many others. International events and trends that may seem far removed from our day-to-day domestic concerns are proving decisive in shaping everyone's lives in this country. We are entering a less western age and in some ways a more dangerous and unpredictable age. Against that background, there is an ever more urgent need for clear direction, objectives and purposes in our nation's foreign policy, as the noble Lord, Lord Kerr of Kinlochard, rightly insisted. That is what my right honourable friend the Prime Minister and the Foreign and Commonwealth Secretary have been regularly spelling out over the past few weeks. As many noble Lords have observed, only this

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morning my right honourable friend the Foreign Secretary set out these matters again in a major scene-setting and strategic survey.

Of course we want to maintain a close and frank relationship with the United States and a positive and fully constructive role with our fellow European Union states. As the Foreign Secretary has said, we shall be highly active within the European Union and we shall urge our fellow members to overcome the severe current challenges that they face and to adapt to the needs and demands of the new global landscape. Mr Hague has also said that we shall reach out to work with Europe's smallest states, as we did in the more distant past, a view that I greatly welcome.

Aside from those almost obvious positioning statements, we will also have our own agenda, which, as the Foreign Secretary has also explained, will require new forms of engagement. The key underlying themes in this new approach will be: first, bringing strategic decisions about our foreign policy, our security policy and our development programmes together in a National Security Council-that is already done; secondly, building up vigorous British bilateral engagements beyond Europe and North America, including new partnerships in the Gulf and with the rising Asian, Latin American and other powers; thirdly, working to reform international institutions to maximise their effectiveness and to develop new platforms; and, fourthly, upholding the highest values of our society while we pursue our legitimate interests and contribute to an increasingly interwoven world.

We need to use every ounce of our united brainpower, national talents, intelligence and experience to handle and influence this new world and to reconstruct and preserve our own national strength and prosperity. Obviously the threat of financial turmoil these past two years has been extremely difficult and great, but that does not mean that this is the time for the UK to retreat from the international stage. On the contrary, it is the coalition's view that we should move forward with renewed purpose and carve out a distinct foreign policy that truly promotes our interests in the wider sense.

It may be said-and I want to reflect what has already been said in this debate-that our obviously constrained national resources cannot possibly support such a newly ambitious approach to foreign policy or to the work of the Foreign and Commonwealth Office. Indeed, the resource issue has been raised by many of your Lordships, including my noble and learned friend, Lord Howe, the noble Lords, Lord Butler and Lord Hannay, the noble Baroness, Lady Williams, and many, many others. We may be criticised, but we have inherited an appalling situation and savings have to be found.

In answer to the point made by the noble Baroness, Lady Symons, we want to sustain the scholarship programme. I will write to her about the details as they arise from the recently announced list of cuts made by my right honourable friend, but we are fully aware of the significance of the scholarship element in our relationships. However, we strongly believe generally that more can be done with less-indeed, it must be-and with a more skilful balance of resources on the overseas side, and that economic recovery will

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strengthen our diplomacy and our international capacities as they must be strengthened. If that sounds like wishful thinking, I urge your Lordships, as did my noble and learned friend Lord Howe, to glance at the most recent Chatham House pamphlet, Rethinking the UK's Role in a Changing World, which shows how a realistic path forward for our country can be shaped. Indeed, it echoes much of the thinking that informs our new policy.

Our new approach requires that much stronger bilateral bonds must be forged with such key centres of influence as Japan, South Korea-incidentally, the G20 summit, which the Prime Minister will attend, will be held there next November-India, Malaysia, South Africa, Brazil, Turkey, the central Asian republics and the Gulf states. In particular, as the Foreign Secretary made clear this morning and many times before, it means elevating significantly our links with India and China, to which Hong Kong continues to provide a brilliant gateway, as the noble Lord, Lord Wilson, who knows more about this than most people, reminded us a moment ago. These are the new nations of universities, technology, advanced skills and capital investment right across the globe-Chinese investment is everywhere-and of massive new consumer markets with which we have both to relate and to compete and which we must address with respect, understanding and language skills, as the noble Lord, Lord Kerr, rightly reminded us.

Our approach means that, rather than just resting on our already extensive membership of international institutions, we have to connect to new global platforms such as the so-called BASIC platform-Brazil, South Africa, India and China-and to a reinvigorated Commonwealth network, to which my noble friend Lord Sheikh rightly referred. We want a Commonwealth which develops a flourishing soft power network of similar values and offers a direct source of benefit to our international purposes and interests-a role which I believe it can fulfil, and which I am personally determined to ensure that it does.

Our more intense contacts will not be confined to government channels. We will encourage a structure of linkages-many already in existence-through trade, educational exchange and services, culture, sport, science and active informal networks. Parliament, its committees, and the universities, with their growing outreach, about which the wonderful lady behind me-my noble friend Lady Morris-referred, will play a key and expanding role in the widened interface between our nation and others. All those points will reinforce our strategy.

One of this Government's first actions was to create a National Security Council. The council will provide a coherent government response to face the challenges and potential threats to our national security, including the situation in Afghanistan, Pakistan, Iran, the Middle East, and the threat of nuclear proliferation, about which the noble Baroness, Lady Williams, spoke so eloquently and with such expertise.

I realise that time is against us in these debates and does not allow me to explore with your Lordships all those subjects in greater detail. I hope that your Lordships will forgive a brief, broad-brush approach. In the

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remaining few minutes, I should like to outline the Government's foreign policy intentions toward the areas that I listed.

The top national security and foreign policy priority at the moment is, of course, Afghanistan, about which your Lordships have spoken. Our objective is to help the Afghans reach the point at which they can look after their own security without presenting a danger to the rest of the world. The sooner that the Afghan state and the Afghan security forces can withstand the range of security threats that are currently in the country, the sooner our troops, who have made such sacrifices, will be able to come home. Of course, our aspiration is that they should come home in due course, by a certain time-but that is an aspiration.

Recognising that our time here today is limited, let me say something about Pakistan, which my right honourable friend has just visited-a country whose fortunes, like ours, are entwined with those of neighbouring Afghanistan. The Government want to help to ensure the democratic, stable and prosperous future that the Pakistani people deserve. Myriad ties bind the UK and Pakistan together, and Britain will continue to support Pakistan in the difficult challenges that it now faces.

To come even closer to home, my honourable friend the Minister with responsibility for the Middle East, Mr Jeremy Browne, set out the Government's policy towards the Middle East region two weeks ago. He made the point that we are extremely well placed to work in partnership with the countries of the Middle East in a way that benefits their peoples and ours. The countries of the Middle East and the Gulf will continue to be essential suppliers of the world's energy needs, and there are similar mutual benefits of flows of trade and investment between Britain and the region. This week, I had the pleasure of welcoming trade delegations from Egypt and Saudi Arabia, and the honour of meeting their respective Ministers for trade and industry. As the noble Baroness, Lady Symons, reminded us, we have launched a joint task force with the United Arab Emirates as part of that process. I reaffirm to her, as I think she already knows, that the Government have appointed Mark Prisk, Minister of State at the BIS department, to cover trade-admittedly, on a temporary basis. We have further intentions on that front, but Mr Prisk is the Minister in place, with reinforcement from many other Ministers.

We will also work to try to resolve the Arab-Israeli conflict, the poison of the Middle East, support the proximity talks which are currently under way, and pursue the concerns so graphically described by the noble Lord, Lord Wright of Richmond, my noble friend Lady Morris-whose name has now come back into my overloaded mind-and the noble Lord, Lord Hylton.

We remain resolved in addressing the international concerns about Iran's nuclear programme and the role that that programme could play in creating havoc and instability in the Middle East. We accept the obvious point that Iran's neighbours have a key role. Indeed, as the noble Lord, Lord Hylton, suggested, Turkey may have an increasing importance in this respect as it

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readjusts its foreign policy position-not immediately favourably to the West but, in the long run, possibly in a very favourable way indeed. There are some very interesting developments going on there.

We will continue to work with the European Union as well as with NATO and other powers to counter yet another threat, not much mentioned in this debate, which comes from Somali piracy. The international response to the very dangerous situation in the Gulf of Aden and the wider Indian Ocean has seen unprecedented levels of co-operation and co-ordination between the EU, NATO and independently deployed navies. That comprehensive approach is very interesting as it is relevant not only in that kind of environment but in dealing with other security challenges and threats which require an innovative mix of military and non-military responses-hard power and soft power interwoven. In fact a broader recognition that the channels of influence now lie in less traditional places, such as the G20, will be the key to future stability.

We have got to look beyond our traditional horizons for our energy security and energy needs. The emerging economies all need reliable and affordable energy to develop further, but that has a direct impact not only on climate change but on worldwide energy security. There is huge growth of demand for energy in oil-producing Middle East countries which are becoming major consumers as well as producers. We are working with countries such as China and India to help develop, make economic and deploy cleaner technologies, such as carbon capture and storage, and to improve energy efficiency in a vast range of new ways being developed by technology. There is the fascinating development of shale gas, which has changed the energy landscape in the US. If it is replicated elsewhere, it could be fundamental in altering the energy vista in every continent, with great rewards for countries as far afield as China and Poland, although there are some uncertainties about how the whole development can be managed. Other countries, such as Brazil, with its enormous oil finds and sugar cane biofuel, also have a great deal to offer the United Kingdom and the European Union, but we need to make sure that they see British companies and a transparent, open and global market as being in their best interests.

There is a point that I should make to the noble Lord, Lord Hannay, and other noble Lords about the strategic defence review. It will be guided by foreign policy requirements. It would be absurd if it were narrowed into the silos of departmental Whitehall, of which the noble Lord, Lord Butler, reminded us. That is not our approach at all. We have to embrace our thinking in all these areas within the overall framework of our positioning in the world, our foreign policy and our purposes, which in turn reflect back into the greater social cohesion in our own country with its many minorities and multi-ethnic patterns.

We will support closely the opening out of all links, supply chains and investment flows that take us deep into the great emerging markets of today and tomorrow. We badly want to see the Doha round of trade liberalisation help this process. In doing so, we will all along strive at the same time-and it will not be easy-to uphold our commitments to human rights,

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political freedoms, open and free trade, capital flows and poverty reduction. We will do this by working more closely with our economic partners than ever before. These are big tasks, which this coalition Government are not afraid to tackle. There are big challenges, which the coalition is not afraid to surmount in a united fashion. This is plainly what the country now wants and what it is now our duty to deliver.

4.34 pm

Lord Howe of Aberavon: My Lords, I rise with some strength of feeling that I might be allowed to say a little more than one normally might at the end of a debate of this kind. The note of determination and optimism that has dominated the discussion deserves the tribute of a sentence or two. I do so also rather conceitedly because, to some extent, the entire debate has been like a slice of the television programme "This is Your Life". It is as though I have been back on a television screen with these surprise creatures being presented to me.

I have known my noble friend Lord Howell probably for longer than anyone else, and I will come back to him. But the contributions made by the mandarin corps-four from the Foreign and Commonwealth Office and the noble Lord, Lord Butler, as an additional recruit-remind me of the potential of that great institution, of what it has achieved in the past and of the importance of our making sure that it is recharged and sustained with the urgency that it deserves at this time, as well as the diversity of context between some of the politicians who have joined in this discussion. The huge tome that I have here is the bound volume of the issues of Crossbow from 1960 to 1962. It was a period of great importance because it was when I handed over the editorship of that journal to my noble friend Lord Howell. I was prescribed a special supplement from Dennis Thompson on the subject of the Rome treaty and the law, which was inserted in the subsequent issue edited by my noble friend Lord Howell. It therefore shadows, curiously, many of the hazards that we have encountered and many of the opportunities.

Others who have taken part in the debate have reminded me of episodes of some significance. For example, the noble Baroness, Lady Williams, and I have shared some curious experiences. I remember vividly when we were helping to put together the economic advisory council to the Supreme Rada of Ukraine. We went to Independence Square shortly after it had achieved independence to see the statue of Lenin, which was surrounded by scaffolding. A poster was pasted on it, which said, "We apologise for this temporary inconvenience". The next time we returned to the square, there was much better news than that. Instead there was a picture of the Madonna-the Blessed Virgin Mary. It moved the noble Baroness, Lady Williams, even more than it did me as a Methodist and she as a Catholic. I turned to her saying, "Do you

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remember what Stalin said? 'How many divisions has the Pope?'". We both agreed that he did appear to have had sufficient divisions.

I have another personal reminiscence. I was guided through the state of Qatar, which I had not much known before, by the noble Baroness, Lady Symons. She persuaded me to go to one of the annual fiestas supporting the case for democracy, freedom and freedom of trade, which is also an important component.

There has been throughout the debate a sense of common purpose despite the contributions having been made from different positions. In a political context, I mention the noble Lord, Lord Maples, for whom I have a kind of illegitimate proprietary title because for many years and until recently he was our Member of Parliament. We live in his constituency, and it is fine to find him reborn in this even more distinguished capacity.

Finally, I turn to the contribution made by my right honourable friend the Secretary of State. For me he is yet another symbol: this infant prodigy who burst upon the Tory Party Conference in 1968 or whenever it was, and who was my special adviser/personal assistant in the 1983 election. He is a man of formidable ability, quite apart from his precocious rhetorical skills. His speech today has been welcomed by everyone who has spoken about it.

So it is good to know that all these spirits are coming together in what I believe is a powerful sense of unity. I get the feeling that we do recognise the nature of the changes we have been through and that we have to face the challenge of those changes. The divisions that sometimes divide us so crudely-on whether the European Union is a good thing or not or whether what we have with the United States is a good friendship or not-all come together because the fact is that they are the relations with which we have to work and they are the relations with which this House is well qualified to work in the light of the contributions made to the debate today. I thank all those who have said kind things about me and I apologise for making a second speech. I beg leave to withdraw the Motion that stands in my name.

Motion withdrawn

London Local Authorities Bill [HL]

First Reading and Remaining Stages

The Chairman of Committees informed the House that, pursuant to Private Business Standing Order 150B (Revival of Bills), the bill had been deposited in the Office of the Clerk of the Parliaments together with the declaration of the agent. The bill was presented, read a first time, passed though all its remaining stages pro forma and sent to the Commons..

House adjourned at 4.41 pm.


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