Lord Taylor of Holbeach: My Lords, the big society is about putting more power into people's hands-a massive transfer from Whitehall to local communities. What we have announced in the spending review will help communities and individuals to take on more responsibility through community empowerment, through opening up opportunities to deliver public services to other organisations, and through social action such as the national citizen service, enabling young people to play a more active role in society.
Lord Roberts of Conwy: My Lords, I am grateful to my noble friend for that reply. Is it not absolutely clear from the alarmingly high structural deficit that this Government have inherited and the inevitable reductions in spending after the spending review that the state has become hyperactive and has overreached itself to an unaffordable, unsustainable extent, as it has done before under Labour? Some of us remember 1975-76 and the IMF marching in. Is it not clear that there must be a change of approach and that, among other things, the private and voluntary sectors in their broadest sense must be strongly encouraged and empowered, as my noble friend said, to take up more of the responsibilities currently foisted on the state?
Lord Taylor of Holbeach: My noble friend makes a valuable point. That is why we are working to open up public services to small businesses, voluntary organisations and social enterprises and to enable those currently in the public sector to spin out from the state through mutualisation. The Government are also providing support for the voluntary, community and social enterprise sectors via a £100 million transition fund and the establishment of a big society bank, which will provide new resources of finance.
Lord Howarth of Newport: My Lords, in acknowledging that this Government believe in a less ambitious state, do they, however, accept that it is the irreducible responsibility of the state to do what it can to ensure that the poor and the vulnerable are sheltered from the storm? If they do, how is it consistent with that responsibility to introduce policies that are bound to increase homelessness?
Lord Taylor of Holbeach: The noble Lord will be aware that this side of the House is very conscious of its responsibilities in government and, indeed, to protect the vulnerable. I acknowledge that this is a difficult time for the country as we take necessary action to reduce the deficit. The voluntary and community sector has always been there for vulnerable people in tough times, and I know that it will be there again. That is why we are looking to support it.
Lord Waddington: Does my noble friend agree that successive Governments have in fact been reducing the role of the state for years and years by farming out difficult decisions, such as whether there should be a law of privacy or whether prisoners should have votes, to bodies such as the European Court of Human Rights, and farming out virtually all their other powers to the bureaucracy in Brussels? Is it not about time that we went for the repatriation of some of our powers?
Lord Taylor of Blackburn: My Lords, instead of creating all these new organisations and societies, would it not be better to support existing organisations, such as the citizens advice bureaux, which are suffering a great deal because of the cuts?
Lord Taylor of Holbeach: We are indeed supporting the citizens advice bureaux and we are hoping to strengthen them under proposals that the Public Bodies Bill will bring forward. The truth of the matter is that there is enormous scope to provide for community action and decision-making at local level. This Government believe in that and are prepared to introduce policies that take it forward.
Lord Maclennan of Rogart: My Lords, in this age of chronic insecurity, do the Government not recognise that, while assistance to individuals to help localities and sectoral interests is important, we need, above all, strong, central and communally trusted government that is capable of reinstating the security that we lack?
Lord Taylor of Holbeach: I hope that the way in which this Government have tackled the deficit issue indicates that this is a confident and competent Government. Indeed, that is the leadership which Governments exist to provide, but it is important to stimulate local communities and make them feel empowered so that they, too, have a role to play in the governance of the country.
Baroness Armstrong of Hill Top: My Lords, in the light of his earlier responses, will the noble Lord tell us how many new state organisations the Government envisage will be created if the ambitions of the health White Paper are realised?
Lord Taylor of Holbeach: I am not in a position to answer that question definitively, but I will ask my noble friend, the Minister responsible, to write to the noble Baroness on that issue. However, we do not see the bodies that are being created under the proposals that I have been talking about as state bodies. They will be community governed and community empowered.
Lord Taylor of Holbeach: Yes; I suppose each to his own. Government centrally certainly has fundamental responsibilities for the security and stability of the society in which we live. However, the policy direction of the Question was about the devolution to local communities of responsibilities that are not necessarily matters for the security and establishment of the state. I was able to give an affirmative answer to my noble friend Lord Roberts of Conwy's request that that is government policy.
The Commercial Secretary to the Treasury (Lord Sassoon): My Lords, the Monetary Policy Committee of the Bank of England takes into account the path for fiscal policy in judging the outlook for growth and inflation, and hence in its monetary policy decisions. As provided for in the Bank of England Act 1998, a Treasury representative attends, and may speak at, the monthly MPC meetings. The non-voting representative plays a key role in ensuring appropriate co-ordination of fiscal and monetary policy, including by briefing the MPC on the Budget.
Lord Barnett: I thank the Minister very much for that Answer. Did he notice a recent speech by Dr Posen, a new member of the Monetary Policy Committee who presumably was appointed by the new Government, in which he said that we should not get too excited about the welcoming figures on growth that we saw last week-which of course did not come from the present Government's responsibilities? I would never seek to accuse the noble Lord of getting overexcited about anything, but perhaps I could refer to a Written Answer he gave me on the question of the non-voting senior Treasury official who attends the Monetary Policy Committee. He said that he,
It would be interesting to know what the Government mean by "appropriate". Would that include telling the Bank that the Treasury wanted to see something done to help growth, for example by increasing capital investment, which is desperately needed and would also help considerably with unemployment?
Lord Sassoon: My Lords, first, since the noble Lord, Lord Barnett, draws attention to the fact that we did have a strong third quarter of growth at 0.8 per cent, we should celebrate the fact that we have had a third consecutive quarter of growth. The recovery will no doubt be choppy, and I am sure that at certain points what happens will suddenly become our responsibility, not theirs. That aside, the responsibility of the Treasury official who attends the Monetary Policy Committee is essentially to bring to the attention of committee members matters of which they ought to be aware in coming to their independent conclusions on monetary policy judgments. That includes briefing them, for example, on the judgments that have been made in the Treasury's Budget so that they can factor them into account in their deliberations.
Lord Forsyth of Drumlean: My Lords, has my noble friend seen the reports today on the mid-term elections in America, which state that President Obama's deficit reduction council is set to recommend that the best way to reduce the deficit is to cut the burden of taxation on the private sector in order to create wealth?
Lord Sassoon: My Lords, in the judgments that my right honourable friend the Chancellor of the Exchequer made about how to achieve the huge and very necessary consolidation of the fiscal position here, by the end of the consolidation period, 77 per cent of the burden will have been taken by expenditure cuts and only 23 per cent by taxation, because it is precisely by not raising taxes and choking off growth that we will get the economy growing again in a balanced way. I am grateful to my noble friend for bringing our attention to that matter.
Lord Peston: My Lords, the Minister rightly reminded us of the legislation under which the Monetary Policy Committee operates, which obliges it to hit an inflation target. There is also a "subject to" clause that has troubled all of us for years. Will the Minister interpret for us the Government's present view of "subject to"? In particular, where do the Government stand on the restoration of full employment as an aim in our economy and as an achievement?
Lord Sassoon: My Lords, the Chancellor writes a very clear mandate letter to the Governor of the Bank of England for the Monetary Policy Committee to hit a target of 2 per cent for the 12-month rise in the CPI. Of course, that is the same target that was set under the previous Government. It is up to the governor and the MPC to interpret the Act in the appropriate way. As far as concerns employment, we must think about the OBR forecast which says that on the Government's policies laid out in the Budget, unemployment will fall and employment will rise in every period considered by the forecast.
Lord Hamilton of Epsom: Does my noble friend accept that, if we are to see a revival in the economy, it is going to come from the private sector and from low interest rates, and that those interest rates would be very much higher if this Government were not addressing the appalling structural deficit that we inherited from the previous Government?
Lord Sassoon: I completely agree and am grateful to my noble friend for drawing our attention to that. Indeed, only 10 days ago, after the spending review, Standard and Poor's, one of the leading rating agencies, moved our rating from negative to stable. It is that confidence that keeps interest rates low and enables businesses to invest.
Lord Soley: First, I thank the Minister for what I think was the first open acknowledgement, and the clearest indication yet, that the last three quarters' growth has been down to the previous Government, not this Government. Secondly, going back to his first Answer, how much importance do the Government attach to the growth of the economy? After all, on many occasions over the past 200 years national debt in the United Kingdom has been far higher than it is now, and it has always been primarily growth that has got us out of it. Therefore, should we not put growth at the very top of the agenda and should not the Government start saying that?
Lord Sassoon: My Lords, first, I made no admission. I do not think that we have time today to apportion credit and blame but I merely note that I look forward to seeing when the party opposite decides that something relating to the economy is its fault. As to the size of the debt, as a Government we inherited the largest peacetime deficit in our history-indeed, the largest deficit in Europe-and there are all sorts of measures of this. We have needed to engage in an £81 billion consolidation of the fiscal situation in order to retain, as we have done, the confidence of the market to enable growth policies to be underpinned.
To ask Her Majesty's Government what assessment they have made of the threat posed to United Kingdom corporate interests by illicit attempts to acquire proprietary technology and other intellectual capital.
The Minister of State, Home Office (Baroness Neville-Jones): My Lords, this Government recognise the risk to the prosperity of the United Kingdom from the loss of intellectual assets, and work is afoot to obtain accurate information as to the size and nature of that loss. The Government provide advice to private sector companies on defending their systems against cyberthreats. The transformative cybersecurity strategy, which the
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Viscount Goschen: My Lords, I thank my noble friend for that reassuring and informative Answer. Does she accept that the protection of proprietary, valuable technology is absolutely critical to companies' ability, and indeed willingness, to invest in long-term research and development, and indeed to our ability as a country to attract inward investment?
Baroness Neville-Jones: My Lords, I think that the whole House will endorse the view that an economy such as ours depends crucially for its advance and future prosperity on its capacity to innovate and the intellectual capital on which that depends. Therefore, a central part of the Government's strategy is very much concern not just with national security but with developing, with the private sector, a secure cyberplatform on which investment in this country from both domestic companies and companies abroad can be based.
Lord Rosser: Bearing in mind the increasing threat posed by the type of crime raised in this Question and the importance of developing still further links and levels of co-operation with other countries on this issue, can the Minister give a categorical assurance that the Government's intention to merge the Serious Organised Crime Agency with the new national crime agency will not result in any diminution of personnel and resources directed at fighting crime of this kind? Furthermore, will the Government's recently announced review of intellectual property and its value to the UK economy also address the threat posed by intellectual property crime?
Baroness Neville-Jones: My Lords, of course many sorts of crime are involved. The original Question was clearly about espionage but there is also theft, to which the noble Lord referred-that is, crime of a more straightforward kind-and both those aspects of our intellectual underpinning in this country need to be addressed. I can give the assurance that there will be no change in the status of SOCA, which will remain central-and I mean central-to crime-fighting in this country, so there will be no diminution in our efforts on that front. As those on the Benches opposite may know, we will produce a strategy for cybercrime by the end of the year. Therefore, I can give that assurance, and we agree with those on the Benches opposite that this is a matter of high national importance.
Baroness Hamwee: My Lords, will the Minister tell the House of any work that is being undertaken internationally since it seems that work with other countries should be central to management of the ware?
Baroness Neville-Jones: Yes, I can give several instances but two in particular. First, the UK is developing a vision for our handling of cyber issues in the future which we will share with close allies. Secondly, noble Lords may have observed that it was announced today
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Lord Reid of Cardowan: My Lords, the Minister and the Government were correct in identifying cyber as a major new priority in the strategic security review, but does she accept that if we are to counter the use of malware, industrial espionage, or, God forbid, cyberattacks from terrorists, possibly in our emergency systems or in the financial sector, we will require above all a new cadre of well-developed, trained and selected young people who are at the very frontiers of thinking in this direction? Can she tell the House what measures have been taken to encourage and identify such a cadre?
Baroness Neville-Jones: The noble Lord puts his finger on a very important issue, and one that will be a concrete and identified part of the strategy that the Government are developing. Clearly we need to have proper competences in government and co-operation with the private sector, and to build skills in this country, which means enhancing the necessary studies at our universities. We must also encourage best practice and good behaviour among all cyberusers-individuals as well as companies.
Lord West of Spithead: My Lords, I know that the noble Baroness shares my view about the importance of cyber, and I welcome the extended work on that. However, her initial Answer did not quite give the right impression that we are still looking at the problem. Am I not right in saying that whole areas-for example, whole engines and their entire design specification, and whole aircraft and their design specification have been taken from companies in this country and America? We know that that has happened. That information is already there and it is important that it is acknowledged by the Government-it was certainly acknowledged by the previous one.
This might be more difficult, but I would be interested to know the answer. Mr Jonathan Evans, head of the Security Service, mentioned China as a specific country. Would the noble Baroness be willing to agree with that, or is it too sensitive to talk about?
Baroness Neville-Jones: I think that I will refrain from rising to that one. The noble Lord is quite right that this is one of the reasons why we have fixed our eyes on this threat. It is real. There is evidence that theft has taken place and it must be stopped, so there is no dispute between us. In my original Answer I was saying that we are trying to put a value on the losses. In other words, we are doing some historical work but also looking at the trend lines to be able to know more than we do at the moment about both the volume and the nature of the threat we face.
Lord Clark of Windermere: My Lords, the Government very sensibly in the spending review announced an increase of expenditure on cybertechnology and
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Baroness Neville-Jones: My Lords, the lead department is the Cabinet Office and I am the Minister responsible in that department. The answer to the noble Lord's question is that we are extraordinarily aware, as I am sure the previous Administration were, of the need for co-ordination. We are building on what the preceding Administration did to strengthen the co-ordination, but we want rather more than that. We want a single strategy that all the departments follow, and do not want simply to co-ordinate existing efforts but to have everybody involved in an overall strategy in which they each pursue their delegated part.
The Minister of State, Home Office (Baroness Neville-Jones): My Lords, the vast majority of people who are being removed from this country depart voluntarily. There is a small category of people who resist. It is known policy that escorts may be used to control and restrain such individuals and that these techniques are accredited by the National Offender Management Service.
Following the death of Mr Mubenga, the UK Border Agency temporarily suspended the use of control and restraint on scheduled flights for a 10-day period between 15 and 25 October. That was for the purpose of carrying out an immediate review to see whether the techniques used on the aircraft were appropriate.
The use has been reinstated. The National Offender Management Service, which conducted this review, has said that there is no substantiation to the claims that have been made that the restraints being used were inherently dangerous. We are now going on to conduct more investigation of the appropriateness and utility of restraint. We do not believe that we have anything like achieved the last word. So I can assure the House that this issue, which I know is a matter of anxiety to us all, will be taken forward and that we are examining what needs to be done very thoroughly.
Baroness Neuberger: I thank my noble friend the Minister for her reply. It is very reassuring to hear what she said. Given the news that we are now to have a new contractor, Reliance, conducting these deportations, perhaps I may ask whether its contract will spell out in greater detail than hitherto what control can be used, and, indeed, whether the individual staff members will have to sign up to a code of practice. I think that that would give the House considerable reassurance.
Baroness Neville-Jones: The noble Baroness raises some of the absolutely pertinent issues which our further review needs to take into account. I cannot comment precisely on the contract of the company that will be employed in addition to G4S but I think it fair to say that the Government feel they need to look at all aspects of the services provided. They need to start with the contract and go right through to what happens on the aircraft.
Lord Rosser: My Lords, what checks will the Government be making to ensure that the new private security firm involved in deportations carries them out in accordance with the laid-down practices and procedures, including, in particular, the use of force?
Baroness Neville-Jones: My Lords, as the House may know, there are several control and monitoring systems in place. Contrary, perhaps, to some of the prevalent views, they are in fact very active. The Chief Inspector of Prisons has oversight of all the detention facilities, which includes the escorts, and he conducts inspection visits on an unannounced basis. The independent monitoring board is based at Heathrow. After the last Question that I was asked on this subject I inquired how active that independent monitoring board was, and I was told that it is very active. It has produced critical comment on some of the practices it has observed, although not in this area, and it has said specifically that it does not think that there is a systemic problem, which I know is one of the anxieties in the House. Furthermore, detainees themselves have the right to make complaints. Those go to the Prisons and Probation Ombudsman and he reviews them. There are many controls trying to ensure that there is both a good system and proper practice.
Lord Anderson of Swansea: My Lords, voluntary departures are clearly much more humane and give much better value to the taxpayer. Are the Government convinced that there are enough incentives available for people who depart voluntarily?
Baroness Neville-Jones: We are trying to increase the number of people who are willing to depart voluntarily. Nevertheless, we also encourage people, when we have to oblige them to go, to do so in a compliant fashion. We are making very great efforts to ensure two things: first, that the maximum number of people who are not entitled to stay do depart this country; and, secondly, that when they have to be escorted, it is done in a proper, humane fashion.
Baroness O'Loan: My Lord, can the Minister tell us what alternative methods to the distraction techniques that are used by detention officers exist? Can she tell us, possibly at a later date, what distraction techniques are used in other parts of these islands by the various detention services? Does she agree that the use of pain-induced compliance requires much more stringent management and that such management will inevitably incur further cost?
Baroness Neville-Jones: I hope the noble Baroness will forgive me, but I did not hear all her question, although I heard the last part. One of our objectives is not to be put in a position where any pain-induced compliance technique has to be used. As a result of this latest incident, not only have we gone through with all escorting officers their duties and the methods of restraint they use, but we have taken them all the way through in detail with particular emphasis on the health and safety aspects of the job, including positional asphyxia, which is a particular source of attention at the moment. We clearly need to have extremely well informed and educated guards on duty.
Baroness Williams of Crosby: May I express to the Minister our appreciation for the energetic way in which she has followed up the concerns of the House? Will she consider allowing the guidance offered by the UK Border Agency to private companies, which is currently not in the public domain, to be made available in the Library to Members of both Houses? That would help us in sustaining the very high standards that she wants to see.
The Chancellor of the Duchy of Lancaster (Lord Strathclyde): My Lords, I rise to inform the House about the publication tomorrow of an interim report from the Leader's Group appointed to identify options for allowing Members to leave the House of Lords permanently. The group, ably chaired by my noble friend Lord Hunt of Wirral, has produced the interim report summarising the views presented to it by a number of Members of your Lordships' House and inviting further comment by 23 November. In order to facilitate the next stage of consultation, the usual channels have agreed that the House will be given the opportunity to debate the interim report on Tuesday 16 November. The group's interim report will be available from 10 o'clock tomorrow morning in the Printed Paper Office and online.
Baroness Anelay of St Johns: My Lords, my noble friend Lord Strathclyde will now repeat a Statement on the European Council. There will then follow the debate in the name of my noble friend Lord Marland and then, at a convenient point very shortly after 4.30 pm, my noble friend Lord Astor of Hever will repeat an Urgent Question as a Statement on the proposed treaties with France.
The Chancellor of the Duchy of Lancaster (Lord Strathclyde): My Lords, I hope that it is now convenient to repeat a Statement that was made in another place by the Prime Minister yesterday afternoon. The reason for the delay was to give this House the maximum amount of time to discuss the comprehensive spending review, an opportunity that was taken up by many of your Lordships.
"With Permission, Mr Speaker, I would like to make a Statement. Clearly the whole country has been focused this weekend on the terrorist threat, and the Home Secretary will make a full Statement after this, but I want to put on record my thanks for all those involved in the international police and intelligence operation, whose efforts clearly prevented the terrorists from killing and maiming many innocent people, whether here or elsewhere in the world.
The fact that the device was being carried from Yemen to the UAE to Germany to Britain en route to America shows the interest of the whole world in coming together to deal with this and, while we are rightly engaged in Afghanistan to deny the terrorists there, the threat from the Arabian peninsula, and from Yemen in particular, has grown, so as well as the immediate steps that the Home Secretary will outline it is clear that we must take every possible step to work with our partners in the Arab world to cut out the terrorist cancer that lurks in the Arabian peninsula.
Let me turn to last week's European Council. This Council's main business was going to be economic governance in the light of the serious problems that the eurozone has faced. But I was clear that we would not talk about the need for fiscal rigour in the EU's member states without also talking about the need for fiscal rigour in the EU budget-both next year and for the future. So we ensured that the EU budget was also on the agenda.
Let me go through both issues. The first is the budget for 2011. From the outset in May, we wanted a freeze. We pressed for a freeze. In July, we voted for a freeze seeking to block the 2.9 per cent proposed by the presidency. Finland, Sweden, Denmark, the Netherlands, the Czech Republic and Austria all voted with us. Unfortunately, together we were just short of the numbers needed for a blocking minority. So, in August, the Council agreed a 2.9 per cent increase.
In October, that went to the European Parliament, which voted for around a 6 per cent increase. This was the frankly outrageous proposal with which we were confronted at this European Council. What normally happens in these situations is that you take the position of the EU Council and the position of the EU Parliament and negotiate, which ends in splitting the difference. Indeed, that is precisely what happened last year.
So before the Council started we began building an alliance to take a different approach and insist on 2.9 per cent. I made phone calls to my counterparts in Sweden, France and Germany, among others, and continued to press the case during the Council. Twelve
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Let me explain what this means. Either the Council and Parliament now have to agree to 2.9 per cent or there will be deadlock, in which case the EU will have to live on a repeat of last year's budget settlement handed out in twelfths over the next 12 months, an outcome with which we would be perfectly content.
Next, and more important, Britain secured a significant breakthrough on a fundamental principle for the longer term. As well as the individual budget negotiations for 2011, 2012 and 2013, there is also a big negotiation about to happen for the future funding of the EU over the period between 2014 and 2020. We clearly want to make sure that all these negotiations go the right way and what we agreed at the Council was a big step forward. The European Commission was wholly opposed to it, but the Council agreed that,
From now on, the EU budget must reflect what we are doing in our own countries and it is quite apparent that almost every country in Europe is seeing very tough spending settlements. This new principle applies to the 2012 and 2013 budgets and the crucial 2014 to 2020 EU spending framework. Just as countries have had to change their financial plans because of the crisis, so the EU must change its financial plans, too.
If you look at the published conclusions, you see that language on the budget formed a very prominent part, even though it was never originally on the agenda. I think that this is an important step forward. In my discussion with Chancellor Merkel at the weekend, we agreed to take forward some joint work to bring some transparency to the EU budget-salaries, allowances and grants. This work has just not been done properly. It is about time that the citizens of the EU knew what the EU spends its money on. This is the spotlight that needs to be shone and that is exactly what we are going to do.
On economic governance, there are two issues. First, there is Herman van Rompuy's report from the task force on economic governance, which was set up after the sovereign debt crisis. My right honourable friend the Chancellor and the Treasury have been fully involved. Secondly, there is the additional proposal made by the Germans and in principle agreed by the Council for a treaty amendment focusing on putting the EU's temporary bailout mechanism on to a permanent basis. Let me take each in turn.
On van Rompuy's report, there are some sensible proposals. For example, the eurozone clearly needs reinforced fiscal discipline to ensure its stability. The crisis has shown that in a global economy you need early warning about imbalances between different
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In addition to the issue of sanctions, a number of concerns have been raised. Let me address each of them head on. First, will we have to present our Budget to Europe before this House? No. Secondly, will we have to give Europe access to information for budgetary surveillance that is not similarly shared with organisations such as the IMF or publicly available on the internet? No. Thirdly, will powers over our Budget be transferred from Westminster to Brussels? No.
Turning to the proposal mentioned in the Council conclusions for limited treaty amendment, we have established that any possible future treaty change, should it occur, would not affect the UK and I will not agree to it if it does. The proposal to put the temporary bailout mechanism on a permanent footing is important for the eurozone. Eurozone stability is important for the UK; nearly half our trade is with the eurozone and London is Europe's international financial centre.
Let me be clear. Throughout this process, I have been focused on our national interest. It is in our national interest that the eurozone sorts itself out. It is in our national interest that Europe avoids being paralysed by another debt crisis, as it was with Greece in May, and it is absolutely in our national interest that Britain is not drawn into having to help with any future bailout. This is what we have secured.
Let me turn briefly to the other business of the Council. On the G20, the Council discussed its priorities for the upcoming summit in Seoul. Again, our interests are clear. We are an open trading nation and we want progress on Doha. This has been going for nearly a decade and 2011 is the year when we must try to achieve a deal. We believe that the world has suffered from economic imbalances. We want countries with fiscal deficits to deal with them and countries with trade surpluses over time to look at structural and currency reforms. We recognise the importance of strengthening global financial stability and that is why we support the recent Basel agreement on stronger banking regulations. We also want global institutions reformed to reflect the growth of emerging powers, so we will see through the work that my right honourable friend the Chancellor has led on reform of IMF votes and board seats. Finally, on Cancun, we are committed to making progress towards a legally binding UN agreement.
This Council demonstrates that it is perfectly possible to deliver for our national interest while protecting our national sovereignty. Tomorrow, the British and French Governments will sign new defence and security co-operation treaties, which will be laid before Parliament in the usual way. These follow the same principle: partnership, yes, but giving away sovereignty, no. At this Council, Britain helped Europe to take the first vital steps in bringing its finances under control. We prevented a crazy 6 per cent rise in the EU budget next year. We made sure that the budget reflects domestic spending cuts in all future years and we protected the UK taxpayer from having to bail out eurozone countries that get themselves into trouble. There is a long way to go, but we have made a strong start. I commend this Statement to the House".
Baroness Royall of Blaisdon: My Lords, I thank the Leader of the House for repeating the Statement made yesterday by the Prime Minister in the other place on the conclusions of the European summit last week. Europe is indeed an important issue for this country and we know how vital it is for our economy, for trade and for jobs. But we on this side of the House recognise that it is a difficult issue for the Benches opposite because not only are they divided on the issue itself, they are doubly divided. On Europe, the Liberal Democrats are fundamentally opposed to the formal position of the Conservative Party, as the debates in this House showed so clearly when we took through the Bill to put in place the Lisbon treaty. The Liberal Democrats stood shoulder to shoulder with this party on the Bill and on Europe, to the fury of the Conservative Party, now their partners in government. However, the splitting does not end there because Europe is still a fault line within the Conservative Party itself-a party which can combine the noble Lord, Lord Tebbit, at one end of the spectrum on Europe, and in the other House the Member for Rushcliffe, the right honourable Ken Clarke, at the other end of the spectrum. It is, indeed, a remarkable containment, even if the party has to keep them in separate Houses of Parliament to do it.
I pay tribute to the skill of the Prime Minister in keeping the lid on these divisions by the simple stratagem of not talking about the issue of Europe at all. Strange, then, that the Prime Minister should so carelessly abandon this tactic in the way he dealt with last week's European Council, especially on the question of the EU budget. Far from remaining silent he talked. Indeed, he talked and he talked and he talked. He talked about how outrageous some proposals were and about what needed to be done-clearly much to the puzzlement of other European leaders. They had not realised that they were there to debate the EU budget, principally because they, like the Prime Minster, knew that it had all been settled in August and that therefore there was nothing else to talk about. However, that did not stop the Prime Minister because he mostly talked about the historic triumph he had managed to bring about.
When people talk quite as much as the Prime Minister did about what he, and he alone, had achieved, it tends to make most people count the political spoons.
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I turn now to the question of treaty amendments. The Conservative Party tried in vain during the passage of the Lisbon treaty Bill to attack this party on the issue of a referendum. However much it tries to scream and shout about it, this party's position on a referendum was clear: we said that we would hold a referendum on a new constitution for the EU and that, because Lisbon was a further treaty like Amsterdam and Maastricht, it was not a constitution and so it was appropriate for Parliament to consider it just as it had done with Amsterdam and Maastricht. Indeed, when we debated this matter and voted on it, a majority in this House understood that point clearly.
In response, the Conservative Party made two promises: it promised to hold a referendum on Lisbon and it promised to hold a referendum if there were, as it likes to put it, any further transfers of power from Britain to Brussels. We know that the Conservative Party has already explicitly broken its promise on Lisbon because there was no referendum. We now see the Conservative Government-I am sorry, the coalition Government-apparently in the process of breaking that second promise by walking away from the pledge to hold a referendum on any so-called transfer of powers. Can the Leader of the House confirm that proposals for change to the Lisbon treaty are likely? Can he confirm that proposals for treaty change will flow from the conclusions of this summit? Can he confirm that if such proposals are made for treaty change, the Government will put these proposals to a referendum of the British people? Can he confirm that if it does not, the Conservative Party will indeed have broken the second promise it has made to the British people on these issues?
I suspect that the EU leaders who attended last week's summit would be astonished at these being the issues debated in your Lordships' House today and
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On the first issue, economic governance, we welcome sensible proposals for greater co-operation to secure economic stability across Europe. In principle, we also welcome the idea of putting in place clear arrangements for providing help to eurozone countries which get into difficulty, rather than relying on a more informal, ad hoc approach. However, we also believe that the right balance needs to be struck between the need for stability and the need for growth in the eurozone.
With regard to the forthcoming G20 summit in Seoul, on the prospects for the world economy, the Leader of the House will know that an increase in trade accounts for almost half the growth that the Office for Budgetary Responsibility forecasts for the UK next year. We shall see whether that prediction is maintained when the OBR brings forward its updated forecast on 29 November. In advance of that, will the Leader inform the House what discussions were had at the European Council on uncertainty in the world economy and what part Europe can play in helping ensure that economic demand is sustained?
Thirdly, on the forthcoming Cancun conference on climate change, the prospects do not look bright for completing the unfinished work of the Copenhagen conference. Will the Leader set out in greater detail than was given in the cursory mention of Cancun in the Statement what the Government will do to advance a deal on finance, which is both a precondition of progress and an essential objective for Cancun?
For the Benches opposite, Europe remains an awkward and embarrassing issue in different ways and for different reasons. But that awkwardness cannot be brushed aside by the bluster which the Prime Minister so unfortunately engaged in last week. Everyone in this country whose job, contract or business depends on Europe knows how important an issue Europe is. It is too important for the political posturing that we saw from the Government last week. We need sensible discussion and proper engagement on Europe from this Government for the benefit of Britain and of Europe. On these Benches, we all hope that the posture on Europe that the Prime Minister tried to strike last week will be a singular folly rather than a sustained strategy. Once is more than enough. The parties opposite cannot heal their divisions on Europe, but no one will be convinced by their attempts to camouflage them. Distraction is not a strategy; proper engagement is. We look to the Government in future to pursue it.
Lord Strathclyde: My Lords, I must congratulate the Leader of the Opposition on having almost comprehensively misunderstood everything that the Prime Minister was trying to do and the way that he went about doing it. I would have hoped, with 24 hours to read the Statement and the exchanges in
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The noble Baroness teases us for being divided and strives to put a wedge between the Conservative Party-indeed, within the Conservative Party-and our coalition partners, the Liberal Democrats. I assure her that we of course have healthy discussions about a variety of matters to do with Europe, but there is no difference of opinion on this Statement and the direction of travel that the United Kingdom is taking on Europe.
I shall try to answer some of the noble Baroness's specific questions about the Statement. It is true that the Council agreed in August that there should be an increase of 2.9 per cent in the EU budget. I have to say to the House that this was not our preferred option; we believe that there should have been a freeze. Given that we are not only freezing but seeking a reduction in public expenditure in the United Kingdom, we thought that it was wrong that Europe should spend more money and that 2.9 per cent was too much. However, between August and now, the European Parliament, supported by the noble Baroness's friends-Labour MEPs did not seek to oppose it-voted for a 6 per cent increase. Therefore, we were very keen to ensure that if we could not rest at nil increase, we could agree at no increase above 2.9 per cent. That is the achievement and the agreement that we have struck with many of our partners-enough of our partners to make sure that that is what will happen.
On the treaty change, I was impressed that the noble Baroness should mention Labour's broken promise on the referendum on the Lisbon treaty. We have only to re-examine the manifesto of 2005, promising to the British people a referendum-a promise which was cruelly broken-to see what was undoubtedly one of the reasons why Labour did so badly in May 2010. The Conservative Party promised a referendum on Lisbon if it were not ratified, but it was ratified, and therefore there would be no referendum.
The noble Baroness asked a really good question-and I do not mean that patronisingly; it was a good question, because it goes to the heart of our position on Europe. It was about the transfer of power. We have a strongly held view and policy that any future transfer of power from the United Kingdom Parliament to Europe should be subject to a referendum. The noble Baroness asked if we believe that the current position is that there is a state transfer of power. We do not. If there were to be a treaty change which meant that there was a transfer of power from the United Kingdom to the European Union then, yes, we would seek a referendum.
The noble Baroness also asked questions about debates on uncertainty in the world economy and on the Doha trade round. I have nothing to add to what was mentioned in the Statement. A series of international meetings is taking place over the next few weeks-in the G20, for instance-where all those matters will no doubt be discussed, and I shall report back in due course to the House.
Lord Alderdice: My Lords, I thank my noble friend for repeating the Statement made in the other place by the Prime Minister and wish to associate myself and
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Turning to Europe, does my noble friend accept that the outcome of the important European Council meeting held early in this coalition Government has demonstrated that those of us in the coalition who are Euro-enthusiasts-I count myself one of them-are not so starry eyed about the European Union that we do not believe that it must be held firmly to account, especially on spending, and that it must share in the relative austerity being experienced by member states and their citizens? The Prime Minister has striven to do that. Does my noble friend also agree that those in the coalition who are more Eurosceptic-the Prime Minister declared himself one of those-also see that a successful European Union and an economically secure eurozone are strongly in the national interest of this country? They are not a matter of disinterest, still less of a threat, but a matter of vital national interest to this country, and so to be followed through with enthusiasm and positive engagement-which, again, I believe that the Prime Minister did on this occasion.
Does my noble friend further agree that not only in the context of the European Union but otherwise directly-we will come to this later in the afternoon- there are opportunities for direct co-operation on a bilateral basis between European Union countries, such as the proposed co-operation between Britain and France, which we on these Benches also strongly welcome?
Lord Strathclyde: I think that the whole House will agree-and if not, they should do-that he spoke with tremendous good sense in support of the Statement and of the Prime Minister. Of course, there are others in this House-in both Houses-who have a division of view between Euro-enthusiasts and Eurosceptics. However, that need not divide us on the broad direction that we should remain part of the European Union and that we should argue for change internally, which is what we have been doing in the past week in laying out a very clear framework for budgetary change over the next 10 years. We will be at the forefront of making those arguments. Following on from what my noble friend said, we are not alone in this or isolated in Europe in wanting a proper budgetary discipline. The noble Lords opposite had an opportunity, over the past 10 years, to get this right and spectacularly failed to do so.
Lord Williamson of Horton: My Lords, on the EU budget for 2011, I thank the noble Lord the Leader of the House for making it clear in the Statement not only that the European Council will not accept more than 2.9 per cent but that if the Parliament and the Council do not agree, there will be no increase at all. I think that would apply not only to EU policies but to the expense rates, travel allowances and things of that kind in the European institutions. Under the provisional twelfths regime, money at this year's level-but no more-will be available on a month-by-month basis. In view of this, will the noble Lord the Leader of the House keep the House informed on the discussions
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Lord Strathclyde: My Lords, the noble Lord, Lord Williamson, brings a wealth of experience to the House and real knowledge of the workings of the European Commission and European Parliament. What he outlined is entirely correct; if there is no agreement to the 2.9 per cent then there is agreement on no increase at all. The current spending pattern would be rolled over to next year and it would be paid on a monthly basis-it would be divided by 12 and paid out on those terms. It also includes all expenditure: expenses, allowances, salaries and so forth. We would greatly welcome that result and it would be very nice to hear from the noble Lords opposite whether they would welcome it too.
Lord Tebbit: My Lords, is my noble friend aware that I had the pleasure of being seated at dinner last week next to our right honourable friend Mr Kenneth Clarke but that he did not talk to me, whereas the Chancellor of the Exchequer, who was opposite, was quite chatty? I particularly enjoyed a long conversation with our coalition partner the Viscount Thurso, who is of course a Member of the House of Commons.
Lord Tomlinson: My Lords, the Statement is in two parts. Might I ask a question about each? On the terrorist incident, perhaps the noble Lord could explain why the Prime Minister was not informed about the terrorist threat at East Midlands Airport until lunchtime on Saturday, when it became quite clear yesterday, in the answers given by the noble Baroness, Lady Neville-Jones, that other Ministers in the Cabinet knew some hours earlier. I hope that he can explain that to us.
Turning to the European Council, I noticed with great interest that the noble Lord read over it very quickly, without his customary emphasis. He was, of course, trying to divert us from some of its content. First, we have it quite clearly in the Statement that,
We had the spectacle of our Prime Minister almost trying to deceive the people of this country by standing on the steps of the Council and claiming that he was going in there to fight for a zero increase when, as we now know from his Statement, he had before going into the Council meeting tried to build an alliance for 2.9 per cent. Does he think it an honest way of dealing with Parliament and the British people to try to pretend that he was fighting for a freeze on the one hand when, before he went in to fight for it, he was already seeking an alliance to support 2.9 per cent?
Will the noble Lord concede that if he really wants to get to grips with budget discipline, he should not be arguing just about the size of the budget? It would be
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Lord Strathclyde: My Lords, I cannot help the noble Lord on his question about the terrorist incident. I am sorry that he did not have the opportunity to ask my noble friend yesterday when she made the Statement.
I do not know what the noble Lord has been dreaming about on the role of the Prime Minister, the 2.9 per cent, when it was agreed and so on. I am utterly clear that unless the Prime Minister had taken a firm stand on the 2.9 per cent, we could well have seen what happened before-it happened last year when the Labour Government were in charge-where the negotiation between the Council and the Parliament ended up with a middle way, a sort of halfway house between the two figures. We wanted to avoid that; we wanted to ensure that not one extra pound should be spent, and that is what has happened. I also note that the noble Lord would have been perfectly happy to have signed up to 6 per cent. That is what most of his colleagues did in the European Council, and it is of course the cost that has increased exponentially over the past few years.
Lord Lawson of Blaby: My Lords, does my noble friend the Leader of the House recall that almost the last act performed by Mr Blair before he stepped down as Prime Minister was to sell this country down the river by surrendering, for nothing in return, a large and growing part of the UK rebate that had been negotiated by my noble friend Lady Thatcher? There were unworthy thoughts that he may have been interested in the job as president of the European Union at the time; I am sure that could not have been the reason, but certainly he got nothing whatever in return. Will my noble friend, who is such an ornament of the present Government, give an undertaking that this Government will not surrender any of what remains of the British rebate?
Lord Strathclyde: My Lords, anyone would think that I had planted that question with my noble friend, but he will readily confirm that I did not. He is correct on both counts: not only did the former Prime Minister, Mr Blair, surrender a large part of our rebate-worth, I think, some £8 billion-and get absolutely nothing in return, but I can give a firm commitment that under this Government no more of the rebate will be handed back.
Lord Martin of Springburn: My Lords, mention is made in the Statement of a military treaty between France and our country. When will we be likely to get the detail of such a treaty? My thoughts go to the fact
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Lord Strathclyde: My Lords, the noble Lord, Lord Martin, asks a good question. It is not that I am trying to duck out of it, but my noble friend Lord Astor of Hever will be repeating a Statement at a convenient moment after 4.30 pm, and I am sure that he will be able to give the noble Lord an answer.
Lord Grenfell: My Lords, I put two brief questions to the noble Lord the Leader of the House. We now know that from now on the EU budget must reflect what we are doing in our own countries. Let us suppose that the debt and deficit position in this country and others in Europe is put back on a sustainable path. Would that mean that a Conservative or a Conservative/Liberal Democrat Government would continue to oppose any increase in the budget, although the situation had changed?
God forbid that the United Kingdom should ever find itself in the same position as Greece, but if it did would it mean that the Government would be ideologically and firmly opposed to anybody helping us out?
Lord Strathclyde: My Lords, on the second question, if a tragedy occurred and we needed to be bailed out-as we have been in the past, sometimes-there is no reason why we should not go to the IMF. That is what the IMF is for. I think the point behind the noble Lord's first question was that if we were in a different position and budgetary environment, would we be ideologically opposed ever to seeing an increase in the budget? Some of us would be very opposed to seeing an increase in the EU budget when there are still so many uncertainties and inefficiencies built into the process of budget-making, grant-making and handing out money. We would like to see a comprehensive review of how this money is spent so that there is firm control by member states and the Commission over how it is all done.
Lord Waddington: My Lords, an undertaking was given that the setting up of the European External Action Service would be revenue-neutral. Have the strongest representations been made to the noble Baroness, Lady Ashton, that the overall overrun that has been announced is quite unacceptable and, if one looks at some of the expenses now contemplated by the European External Action Service, clearly avoidable? If representations are not made about this clear breach of faith, I shall be very disappointed in Her Majesty's Government.
Lord Strathclyde: My Lords, my noble friend is right that certain considerations were discussed at the passage of the Lisbon treaty. Indeed, as a party, we rather opposed the setting up of the External Action Service. However, it is a fact that it is being set up. The noble Baroness, Lady Ashton, is in charge. It needs to be supported. As part of our general opposition to increase in expenditure, we have made several points about the EU budget. I am not aware that we have specifically raised the EAS annual budget, which will be £5.8 billion-a substantial amount of money. However, we hope that as it is rolled out it will be to the benefit of not just the European Commission but the member states of the European Union.
Lord McConnell of Glenscorrodale: My Lords, there is a connection between the first and second parts of the Prime Minister's Statement. While any genuine attempt to reduce waste and inefficiency in the European Union's institutions will be welcomed by all of us, can the Government guarantee that the work of the European Union in development activity, peacebuilding and peacekeeping-which will contribute to our security as well as that of the developing world-will not be affected by the decisions that were made last week in Brussels?
Lord Strathclyde: My Lords, I think I can give the noble Lord that assurance. He knows that the Government have given an absolute priority to meeting the target of spending 0.7 per cent of gross national income on overseas aid by 2013. We remain committed to that. We wish to work closely with our European partners so that they also achieve that target. Therefore, I see no reason why there should be any slippage in that aim.
Lord Campbell of Alloway: My Lords, this is a very short question. The House will be aware that the EU budget has not been approved by the Court of Auditors for 14 years. With the help of the noble Lord, Lord Tomlinson, who knows more about this than I, we raised this matter with the Government in May. I have not, alas, seen the paperwork. That is not the fault of the Government; they have to negotiate with other powers. I have tabled a Question for Short Debate on whether the grounds on which the Court of Auditors has not approved the budget for 14 years should be examined. That will be a matter for the House in due course.
Lord Strathclyde: My Lords, my noble friend said he had a short question, but it is a huge subject. I look forward to his debate. It is completely unacceptable that the European Court of Auditors has not been able to sign off the EU accounts. I understand that the majority of the errors are not due to fraud but to the sheer complexity of the rules and regulations. We need to address the root cause and press for simplification of EU financial management alongside reform of the budget itself.
Lord Stoddart of Swindon: My Lords, I wish to ask the noble Lord about economic governance and the German Chancellor's proposal to revise the treaty. Why are the Government agreeing to that? Can any
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Lord Strathclyde: My Lords, on economic governance, we take very seriously the stability of the eurozone. Some 40 per cent of our exports go into the eurozone and 50 per cent of our exports go to the EU, so it is a massively important market to us and financial stability is important. However, we maintain two things: first, we would rather not see a change in the treaty; and, secondly, we would rather not see any change involving a transfer of powers from the UK to the EU. We are not certain that a treaty amendment is required, but if it is and we are assured that there is no such transfer of powers, a referendum in this country would be unnecessary. If there were a transfer of powers, we would not agree to it.
Lord Marland: My Lords, I should like to thank the House and all noble Lords in advance for joining this debate today. I should also like to thank the noble Lord, Lord Smith of Finsbury, for giving the debate its name.
The future of energy policy is a question absolutely at the heart of the coalition. Our central theme is twofold: energy security and the low-carbon economy, with value for money for the taxpayer. For years we have relied on the bounty of North Sea oil and not invested in the new energy sources that we will need in the future, or invested the proceeds of North Sea oil to meet our future demands. That must change, and we need to get on with it fast.
I have said in the House many times that the delivery of energy supply transcends many government periods. It is incumbent on us to be part of a broad coalition for the benefit of Britain. Later this year, we in this House will have it in our power to provide a clear pathway to the future, with legislation in the form of the next energy Bill to make that happen.
Since May, many noble Lords have asked recurring questions. Are we serious about nuclear? Will the first cut be CCS? Are we serious about the growth agenda? There are some who think that we should not be serious about the green agenda. Let me emphatically provide noble Lords with the coalition's response. On Monday 18 October, we announced the key government deliverables that will help pave the way for the building of our new nuclear power. Following the spending review announcement of up to £1 billion for the first CCS demonstration project, last week I started the process of detailed negotiations with Scottish Power on its proposals for that project.
My Lords, whether you like it or not, we intend to be the greenest Government ever. This will require showing leadership and setting an example. Therefore, we will reduce the carbon footprint of central government by 10 per cent this year. Our green agenda will launch the green deal, implement the green investment bank and-through RHI and FITs-encourage renewable development. All of those equal moving to a secure energy supply, new jobs and vital investment.
However, we must do more, and we will. It has been said that we are not providing enough stability to the energy market, so we are pursuing an ambitious energy market reform programme that will support the delivery of a secure, low-carbon, affordable energy mix for the 2020s and beyond. A framework to give a solid carbon price is the first step in providing the incentives for the investment that we so urgently need. Last week, 144 licences were granted to extract oil and gas from UK waters in the 26th licensing round.
My Lords, I could go on, and I will. We have already extended the carbon emissions reduction target-CERT-whereby 3.5 million more homes will be lagged. We have also introduced proposals to accelerate smart meter rollout by comparison with previously published targets. Our wind, biomass, wave and tidal resources make us a natural world leader for renewable energy, but Britain has not realised its potential. We have the highest tidal reach, 40 per cent of Europe's wind and 11,000 miles of coastline to take advantage of. That is why we committed £200 million in funding for low-carbon technologies, including offshore wind technology. We are providing up to £60 million to meet the needs of offshore wind infrastructure at our ports. We have boosted the UK's gas storage capability by 15 per cent already, by giving consent for a new facility in Lincolnshire. The renewable heat incentive is the first scheme to provide long-term support for renewable heat technologies and will drive a more than tenfold increase in renewable heat in the UK over the coming decade.
Even with the most laborious of economic circumstances in which to start governing, we have shown that we are open for business and there is a clear pathway. Investors now have certainty about the environment in which they are investing. We must look to build a new kind of economy to ensure global competitiveness and protect ourselves from price shocks.
On our nuclear legacy, public safety is paramount. The funding of nuclear decommissioning will therefore increase by £2.5 billion in 2014-15, so that we really get to grips with our waste legacy issues. I have also commissioned a strategy on how we can further develop our expertise in waste management in the nuclear field.
This debate, though, is our opportunity as the Government to hear your Lordships' views. We have in this House the greatest brains and experience on this subject covering all sides of the spectrum. All these views will be respected and I hope that I can count on your support to deliver a secure energy supply for generations to come.
Lord Grantchester: There is now general consent that climate change is happening and that human activity is contributing to the change. While there has
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Europe currently produces more than 10 per cent of its energy from renewables. In the UK, the figure is just 3 per cent. This country must continue and intensify the progress initiated by the previous Administration. We must push forward to reach the accepted targets and press on with policies to get us there. The coalition Government have confirmed a commitment to 15 per cent renewables by 2020, but this is still behind the EU-wide target of 20 per cent, with several countries exceeding the target, most notably Sweden, which shortly will hit 50 per cent. The coalition Government will have to seriously consider raising their game if they are to earn the title of the greenest Government ever.
Everyone recognises the dynamic advances made in communications over the past few years. In the energy sector we need no less of a step change in our thinking. We need to move away from thinking that energy flow is one-way down pipes and wires from a big industrial complex somewhere over the hills and beyond our influence. The energy sector is regulated by government, and this Government need to make wise choices to ensure that we meet our climate change commitments. These must include public education so that everyone understands the contributions necessary in the home and in the workplace.
I declare my interest as a food producer when I say that the risks of unrestrained carbon emissions are significant for three key reasons. First, the country's food supply is at risk from rising sea levels. Eighty per cent of the best grade 1 agricultural land lies at or below current sea levels. Secondly, rural businesses rely on a secure and steady energy supply. Because of greater distances and vulnerability of supply, these businesses are at an increased risk of interruption from storm events. Thirdly, the agricultural industry is likely to suffer because of the increased risk of water shortage. Recently the University of Reading released a report entitled Water for Agriculture, commissioned by the Royal Agricultural Society of England. Scientists found that climate extremes such as droughts and flooding are likely to reduce the amount of water for agriculture and water culture, which will pose a major challenge to farmers, researchers, plant breeders and policy advisers. Given that agriculture and the food sector are recognisably responsible for a disproportionate amount of greenhouse gases when compared with the value of their production, they have challenged the conventional mindset of being seen as the problem. Instead, they can help to show the change that is necessary by being part of the solution. I am greatly interested in the Government's response to the findings of the University of Reading report, and in how they plan to interact with farmers and food producers to address their concerns, both immediate and long-term.
In the broader economy, energy historically has been a major driver of inflation. A major characteristic of renewables is a stable price, as much renewable energy is ambient and therefore free. The bigger implication of low-inflation energy for economic stability is a huge opportunity to be grasped, especially against the recent background of rises in energy prices of 125 per cent. The need to ensure national strategic objectives can be met by means of an effective planning system, particularly in relation to wind power.
The suspension of the coming into force of the planning infrastructure legislation puts the country back into delay and uncertainty. In addition, many of the renewable projects are under 50 megawatts and are therefore decided at local level. It is unclear how the local planning framework will work. Can the Minister say how this country will be able to meet its targets? The regional spatial strategies are vital for getting approvals granted but these have now gone.
Can the Minister confirm when he will bring into reality the extension of permitted development rights for small-scale renewables-a matter that I understand is on his desk? Will this also ensure planning presumption in favour of renewables outside nationally protected areas and for small-scale-up to 5 megawatt-schemes in national parks and the green belt? This will demonstrate increased ambition for PV, helping to provide clarity for the UK PV industry, where there is a need to address urgently what is meant by "higher than expected deployment" requiring an "early review". When will this start? Will the Minister also confirm that the coalition Government will not act on the Conservative proposal to bring in a third-party right of appeal to planning consent, which will only increase delay and frustrate investment?
The introduction of feed-in tariffs from 1 April under the previous Administration has provided the opportunity to make a step change in renewable energy. The renewables obligation has supported only the cheapest, very large-scale projects. This feed-in tariff extends support to projects of any scale up to 5 megawatts where individual local co-operatives and developers can get on with their own investments at the small, local level. The benefit that this can bring to renewable supply is best demonstrated by Germany, which has operated in this way for 15 years. There, 80 per cent of renewable power is from small-scale sources and only 20 per cent from major infrastructure schemes. In contrast, in the UK 96 per cent of renewables is provided by the large power companies. This opportunity must not be frustrated by the planning regime of local authorities operating under the present severe financial restraint. The Minister can free up a huge surge in activity.
The feed-in tariff pays different rates to differing project scales and sources of supply, and, generally speaking, pays the correct amount to guarantee a return on investment of between 6 and 8 per cent. First, will the Minister ensure that this support is protected under any future review, that it extends well beyond 2013 and that it will not be subjected to meddling and cuts? Secondly, he is urgently required to review the regime regarding small-scale waste plants, particularly on farm anaerobic digestion schemes. Regrettably, although the price is correct for commercial
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The Government recently committed £1 billion for the green investment bank. This bank was a policy idea first raised by the previous Labour Administration and it is therefore one that we are happy, in principle, to see adopted. Is the Minister able to clarify the specifics of this policy? How does he see the functions of the green investment bank? Will it be able to raise money on the financial markets? Has the department made any forecasts of the total funding that will be available in each of the next five years, and what leverage will this have with the private sector? Our vision was to have the green bank supported by both public and private funding-a dynamic partnership to champion social and environmental change.
On the carbon reduction commitment, there is the bizarre situation where, if a company claims feed-in tariffs or renewable obligation certificates as a company for on-site renewables, it has to count these renewables as producing carbon in the same way as average grid-mix electricity. The shake-up to the CRC announced in the CSR means that the Treasury will keep all this revenue. If this rule is not changed, we will be in the position of the Treasury taking money from companies investing in renewables for carbon that they did not emit. The situation needs urgent attention as it is vital that the commercial sector also invests in renewables.
Under the Labour Administration, the department instigated a marine energy action plan to which industry contributed enthusiastically. Much valuable data and many useful suggestions were assembled within the four work streams of finance, infrastructure, planning and technology, but the impetus was lost during the general election. The department now faces the challenge of utilising that work with the new policies of the coalition Government, who state that they will introduce measures to encourage marine energy. In the July annual energy statement the department promised to consider how the development of marine energy parks around the British coast can help to support marine energy in the UK. Detailed proposals are expected by the end of the year. The UK cannot afford to lose its lead on marine. We need to see five renewable obligation certificates for wave and tide. Once again we need to catch up on lost momentum.
On the RTFO, we need the mandatory EU sustainability standards to be implemented as soon as possible for both renewable transport fuels and liquids for power generation. They should be implemented by the end of this year but the Government are waiting until 1 April. We would like to see good-quality biofuels, as the UK biofuel industry has risen superbly to the sustainability challenge and has, since the beginning of the scheme, been producing biofuels that perform acceptably well against the RTFO sustainability criteria. The reports from the Renewable Fuels Agency on the
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Within my sub-region of Cheshire, there have been many projects that can be identified as examples of best practice. Envirolink Northwest is doing excellent work with smaller projects, both on farms and in businesses, supporting the installation of renewable energy technologies. This momentum is in serious danger of being lost with the abolition of the NWDA. It remains to be seen what resources and commitment will be given to the new area local enterprise partnerships. Once again, momentum is being lost. It is important not to take our foot off the accelerator. The department under the Labour Government made some real strides forward. It remains to be seen whether many of the projects and policies mentioned will come to fruition under the coalition Government. It is positive to see that the renewable heat incentive and plugged-in places funding survived the cuts, albeit in depleted form. I think that Envirolink would argue that grid connection and finance are the two real sticking points at the moment. For example, even with the arrival of feed-in tariffs for solar panels, for many people the up-front capital costs mean that they will remain prohibitively expensive. Our loss of the co-ordination role from the North West Development Agency is a real blow as there is no other organisation to take up effectively the mantle of sub-national climate change. The LEPs will struggle to really deliver a low-carbon agenda on the ground without any funding or co-ordination and support.
Developing renewable energies is an integral part of our fight against climate change. Notwithstanding the Government's slogan of wanting to be the greenest Government ever, it remains behind Scotland's challenge of 80 per cent renewables and behind the comparatively modest European target of 20 per cent renewables by 2020.
There is not enough urgency in the Government's policies compared with what was in train and proposed under the previous Labour Administration. They are missing a major injection of funding for infrastructure and research. One related planning policy that will undoubtedly impact the future of renewable energies in this country is the Government's plans for the Infrastructure Planning Commission. The commission is proposed to be replaced by the major infrastructure planning unit-a policy that we are anticipating to see in more detail when this House considers the decentralisation and localism Bill. Through this change the Government are promising to continue a fast-track approach to planning applications, for example for wind farms, while at the same time promising the public a greater opportunity for influencing these decisions. We look forward to seeing how they plan to reconcile these two competing parts of the process when the Bill reaches this House.
Lord Teverson: My Lords, I very much welcome this debate. This House has had great debates about climate change and energy and I am glad to see that we will
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One thing that I want to do in my introductory remarks is to say how much I appreciated the work of the noble Lord, Lord Hunt of Kings Heath, in the latter part of the Labour Government. I appreciate his commitment to these issues and what he worked hard to achieve. However, I remind the noble Lord, Lord Grantchester, that the previous Government's successes in this area are perhaps rather more measured than he might think.
Let us take something as important as the Climate Change Act, a great milestone in addressing climate change for this Parliament and the UK. The previous Government were good at setting out targets and their aspirations for what they wanted to do, but it was rather more difficult to achieve those targets and aspirations. The Labour Party had its own manifesto targets on the carbon footprint, which it failed to meet. From 1997 to just prior to the last year of the previous Government, the United Kingdom's carbon footprint very much flat-lined and we did not achieve the targets. We met them in the last year, but that was due more to international economic meltdown than to anything else. We had a lot of talk about renewables and some investment in the latter stages, but all we have done so far in relation to the 27 member states is to progress from overtaking Malta to moving ahead of Luxembourg as well. As for carbon capture and storage, we had tenders, we talked about it and we were enthusiastic about it, but we still do not have any commitments on it. Smart meters and feed-in tariffs were delivered in the last Energy Act, which was a great move forward, but it was rather beyond the 11th hour in terms of making the changes that are required for this agenda.
I want to spend my time today looking at the poor relation in energy and climate change-energy savings. I am not saying for a moment that the other areas are not important but I want to concentrate on this one. It is a Cinderella subject that is left out too regularly. Energy prices are currently higher than they have ever been. In fact, retail prices seem to be moving further than they have ever been from wholesale prices, perhaps due to a lack of reform in the way in which the industry was regulated over the past few years. I was speaking two weeks ago with some representatives of the industry, who told me that energy costs in most of industry are still a sufficiently small percentage of the overall costs that the management does not really concentrate on them. That is true of a number of households-though not all households-as well. I will come back to that issue.
The fact is that buildings account for some 40 per cent of our electricity and energy costs. It is one of the biggest challenges that we have. I absolutely agree with one thing that I read in the previous Government's White Papers-that energy savings are the most efficient and economic way of tackling climate change. Investment in this area produces a bigger return than any other tool for meeting the strategy of decarbonising our economy.
I was in India last month and in China last year. Energy savings are the big headline in climate change there and what people are trying to do. It is an exciting subject. In the previous five-year plan, China had a 20 per cent reduction target from energy efficiency, which I believe it is just about to achieve. Under the Copenhagen accord, the decarbonisation of its economy is largely met through energy efficiency and there is a target of 40 per cent savings by 2020. In the global context, that is a big deal and a major way of moving forward. I think that in the UK and Europe we sometimes understate it. If we look at Europe, under the 2020 package, we had a target of 20 per cent renewables and a 20 per cent reduction in carbon footprint. Both are statutory European targets, but the third 20 per cent- 20 per cent energy reduction by 2020-is only an indicative target. Again, even within the European context, that shows that it is the poor relation.
Here in the UK, we had the important Warm Front scheme, which we debated briefly last week, and the carbon reduction commitment, which was a strange way of moving around what was originally an energy target. I congratulate the Government because over the summer they rather contentiously started to stop the free issue of units under the CRC scheme. That is an important move forward. We had the CERT scheme, under which several years ago we used to receive 10 energy-saving light bulbs in our post nearly every day. We put the energy companies in charge of saving energy, which was rather like putting Dracula in charge of the blood bank or perhaps the bishops in charge of Lords reform. It seemed quite inappropriate and something that would not work. I hope that there will be changes in that area.
To me, energy saving is not just a virtuous circle; it is a virtuous spiral. Let me explain why. We have estimates from Ofgem that we need £230 billion-worth of investment in our generating and electricity supply industry over the next few years to meet our energy gap. It is obvious that the more we meet our energy savings targets and go beyond them, the less we need of that investment. In terms of energy savings, we have the planning system, which was mentioned earlier. We do not have to ask for planning permission for energy saving. It can go ahead without delays. In fact, energy saving is one of the ways in which we can meet targets without the great changes that we need otherwise.
Let me take one or two other issues. One of the ironies about carbon leakage is that, although we are about to meet our Kyoto targets at the end of 2012, as measured by carbon production, we will increase our carbon consumption by some 19 per cent over that time in comparison with 1990 levels. By saving energy, we do not have that conflict; indeed, we reduce it. On renewables, I am in favour of them, but we have a problem with intermittence in wind power. Yet with energy saving, we have a completely non-intermittent way of meeting our energy requirements.
However, there are two other much more important areas. The first is fuel poverty. One of the great problems in the past two years was that, with energy prices rising, more people were entering fuel poverty. I know that these figures have been quoted before, but something like 4.5 million households are now in energy poverty.
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I say to the Minister that the Government should not ignore this poor relation but make sure that they keep focused on it, as well as on the many other technological solutions. I look forward very much to the energy Bill that will be coming through this House, the green deal, which I know is targeted to meet a number of these issues, and the green investment bank, which could provide investment in the right sectors. Energy saving is not a very sexy subject, but it could really help us to meet our climate change targets. It is one area where perhaps we could follow the developing world rather than trying to lead it.
Lord Lawson of Blaby: My Lords, I congratulate the Government on one of the decisions that they have taken, one which was criticised by the noble Lord who spoke for the Labour Front Bench; that is, the decision to take the £1 billion taxation in effect from the carbon-reduction scheme and apply it to reducing the appalling deficit with which this Government are landed, rather than keep with the idea of the previous Government. The purpose of taxation is to give money to the Treasury for the needs that it has in order to finance necessary public expenditure and to maintain public finances in good order. I congratulate the Government on that.
There is little else on which I feel that I can congratulate the Government. But I begin by declaring an interest as the founder and chairman of the Global Warming Policy Foundation, which celebrates its first anniversary later this month. As its name implies, it is concerned above all with the policy aspects, which we are discussing in this debate, of this whole multidimensional climate change issue. I speak, incidentally, for myself and not for the foundation, which does not have a corporate view.
Because various remarks have been made, I should say that the foundation is financed by a range of generous donors. But one thing is absolute: in order to show that there is no possibility of our not being independent, we do not accept a penny of money from the energy industry or anyone who has a significant interest in it. I am glad to say that this is monitored by my excellent board of trustees, most of whom are Members of this House. All the Benches are represented. I am the only Tory. There are two from the Labour Benches, who I am glad to say are in their places. There is one from Liberal Democrat Benches. There are two from the Cross Benches and one from the Bench of Bishops. It is fully monitored that we do not raise any money from the energy industry.
In his admirably brief opening speech, the Minister mentioned two things which the Government generally-I do not want to single my noble friend out because he was just speaking the Government's policy-are trying to make out. They say that there is a real energy security problem, which we have to meet by decarbonising
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Carbon-based energy has never been more abundant than now. It is commercially extractable because, not least, of the exciting recent technological development of the commercial extraction of gas from shale. This not only increases enormously the commercially winnable carbon energy resources of the world, but it is fortunate that shale is abundant throughout the world-in North America, Europe, South America and so on. We do not have to feel that we are dependent on the Middle East, which may be unstable, or on Mr Putin, who may be unreliable. The development of the liquid natural gas business has also increased security on the gas front very significantly. So there is no energy security problem. In so far as there is an energy security problem, it is because we may come to rely too much on intermittent wind power, when the lights might indeed go out, but that is the only problem we have.
I turn to the idea of raising substantially the price of carbon. It is the essence of the Government's policy because it is only way you can shift to so-called green energy, which is much more expensive. Somehow, it is claimed that this will produce an economic benefit and create jobs. I am reminded of the distinguished 19th-century French economist, Frederic Bastiat. He pointed out that if you went around breaking windows everywhere, you could create an enormous number of jobs for glaziers, but that did not mean that it was a sensible thing to do. That is a parable of the Government's policy. When we debated this issue just before the Summer Recess, the noble Lord, Lord Giddens, who I respect and am glad to see will be speaking later, pointed out that the creation of jobs argument is complete nonsense and rubbish.
On this front, I want to mention two of the economic consequences of the Climate Change Act 2008, to which this Government, like the previous Government, are wedded. Perhaps I may quote from an interesting article on energy in the current issue of the Economist. It begins:
"Many factors were responsible for the industrial revolution. But the use of fossil fuels was clearly vital in driving a step change in rates of economic and population growth. So the current rise in the cost of extracting such fuels should be the subject of considerable concern".
The increase in the cost of extraction will be nothing compared with the increase in the cost of energy if we go from carbon-based energy to non-carbon energy. We in the United Kingdom do not use carbon-based energy because we have a love affair with or addiction to carbon, and we do not use it because the oil companies are so powerful that they force us to do so. We and the rest of the world use it, quite simply, because it is by far and away the cheapest source of energy. Anything else is more expensive. It may not be so for ever, but for the foreseeable future that is the case.
Despite energy savings, there will be a huge increase in fuel poverty in this country, something I do not want to see, as well as in costs generally. The Minister mentioned the green investment bank. This is what the chairman of the green investment bank commission had to say in an interview published in the Daily Telegraph on 3 July:
"The total estimated cost of meeting our current climate change carbon reduction targets is between £800bn and £1 trillion ... There's really been nothing like this since the post-World War Two reconstruction programme".
That is the appalling burden we are saddling ourselves with, and what for? The purpose is to decarbonise, as it were, the world economy. My noble friend referred to the objective, which is to reach a global agreement in Cancun in December at the United Nations climate change conference to decarbonise the world's economies, faster for the developed world, of course, than for the developing world, but it is accepted that it makes sense only if every country-China and India as well as the developed countries-takes its share. This is not going to happen. The lessons of the Copenhagen conference last December should have been clear. Why is that? The reason why the Copenhagen conference was a fiasco and no global agreement could be secured was because of the position of the developing countries, with which I have considerable sympathy. There was, incidentally, a prior meeting between the so-called BASIC countries-Brazil, South Africa, India and China-in Beijing on the eve of the Copenhagen conference, and they agreed that none of them would agree to a binding global carbon-reduction agreement in which they were participants. They were very happy for the developed world to cut back its carbon but they were not going to take part.
Why? Because they have a real problem with poverty and its consequences. Hundreds of millions of their people still suffer from preventable disease, malnutrition and premature death and they know that to get these people out of poverty as quickly as possible they need the fastest rate of economic development. That requires among other things-it is not the only thing-using the cheapest available form of energy, and that is carbon-based energy. That is why they would not agree at Cancun either, and they are absolutely right. That is why China is building a new massive coal-fired power station every week, and why it is the new imperial power in sub-Saharan Africa and is getting its hands on all the raw material resources it can, including gas, oil and coal. It is not making this great diplomatic, financial, economic and political expenditure because it does not mean to use them-it will use them. That is how it sees the future and it is absolutely right. So the idea that there will be a global agreement on this is unwarranted. There may be a global agreement on adaptation aid to the poor countries should that be needed-I would be content with that-but there is not going to be a decarbonisation agreement. As to us going it alone, the total amount of emissions that we are responsible for is less than the growth in emissions from China in one year.
Another reason the global agreement will not happen is because after China the biggest emitter of carbon dioxides is the United States. Unlike George Bush Jr, President Obama came in saying that he was going to
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There is no way this is going happen. It is complete madness; it does not make sense. As their predecessors did, the Government trumpet that we are the only country in the world to have a Climate Change Act which binds us legally to an 80 per cent reduction by 2050, when some of your Lordships-not me-might even be alive. They say that no other country has this commitment. Of course no other country has this: no other country is so stupid. The policy simply does not add up.
What is it all in aid of anyway? It is a fear that global warming, which has paused for the past 10 years, may resume. I do not know if it will-no one knows-and I am certainly prepared to confess that I do not know. I am one of the few people in this business who does not know what the temperature of the globe is going to be in 100 years. It may be warmer than it is today, but so what? We can adapt, which is what people do in different parts of the world where temperature varies enormously. As economic development takes place, capacity to adapt is greater than ever; as technology develops, the capacity to adapt is greater than ever.
The Intergovernmental Panel on Climate Change, which makes the projections on which the Government ostensibly base their policies, gives certain warnings for the next 100 years. It thinks that the temperature will go up between 1.8 degrees Celsius and 4 degrees Celsius. It says that a rise at the upper end, of 4 degrees Celsius, would mean a loss of global GDP of somewhere between 1 per cent and 5 per cent. We in this country will benefit from global warming, as most of us instinctively and intuitively sense, but there will be parts of the developing world which will not. Let us assume for the developing world a loss not of 5 per cent but of 10 per cent. That would still mean on the panel's growth projections that living standards in the developing world in 100 years would be only eight times rather than nine times as high as they are today.
Lord Lawson of Blaby: I speak very seldom in this House and I hope that I will be allowed a little bit of a margin on this issue, but I am so grateful to the noble Lord opposite for the reminder. I have often wondered what he spends his time doing. It is obviously reading the Companion, which is a very sensible thing to do. I shall conclude soon.
Noble Lords may say, "Well, surely the panel is being a little bit optimistic in projecting that this century is going to be far and away the best century economically that the world has ever seen". Perhaps
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I could say more, but I shall not. The only conclusion that I can reach about the Government's policy, which is no different from the Opposition's policy, is that it is both intellectually incoherent and economically illiterate.
The Parliamentary Under-Secretary of State, Ministry of Defence (Lord Astor of Hever): My Lords, with the permission of the House, I shall now repeat a Statement made earlier today in the other place by my right honourable friend the Secretary of State for Defence.
"First, I am sure that the whole House will wish to join me in paying tribute to Sapper William Blanchard from 101 (City of London) Engineer Regiment (Explosive Ordnance Disposal), who died on operations in Afghanistan on Saturday. Our thoughts and prayers are with his family and friends at this dreadful time.
The Prime Minister and President Sarkozy this afternoon signed two treaties that mark a deepening of the UK-France bilateral relationship. The two treaties will next be laid before Parliament, allowing honourable Members the opportunity to consider them as part of the process towards ratification. Separately, the texts of both treaties will be placed in the Libraries of both Houses today.
The UK-France relationship is a strategic partnership of sovereign nations working together to tackle the biggest challenges facing our two countries at a new level of co-operation. The treaties do not diminish in any way our ability to act independently when the national interest decides. They provide us with greater capability when we do decide to act together.
The UK has welcomed the recent French decision to rejoin NATO's integrated military structure. We believe that this is good for NATO, good for the UK and good for France. It makes sense for us now to achieve maximum interoperability, greater commonality of doctrine and more efficient use of equipment. Closer co-operation with France will also provide better value for money for the British taxpayer.
Let me give the House a sense of the scope of both treaties. First, the Defence and Security Co-operation Treaty will develop closer co-operation between our Armed Forces, the sharing and pooling of materials and equipment, the building of joint facilities, mutual access to each other's defence markets, and industrial and technological co-operation. The treaty provides the framework; details will emerge over time as more detailed work is done.
The second treaty covers collaboration in the technology associated with nuclear stockpile stewardship in support of our respective independent nuclear deterrent capabilities, in full compliance with our international obligations. The treaty provides for the joint construction and operation of a new hydrodynamics facility at Valduc in France and technology development centre at the Atomic Weapons Establishment in the UK. The facilities will be operational from 2015. This programme, named Teutates, will assist both countries in maintaining the safety and reliability of their respective nuclear stockpiles and improve expertise in countering nuclear terrorism.
The facilities will enable each country to undertake hydrodynamic experiments in a secure environment. The hydrodynamics facilities use radiography to measure the performance of materials at extremes of temperature and pressure. This enables us to model the performance and safety of the nuclear weapons in our stockpile without undertaking nuclear explosive tests.
Today's summit is only the start of long-term deepening of the UK-France bilateral relationship. France is the UK's natural partner in Europe for defence co-operation. France and the UK have some of the most capable and experienced Armed Forces and the largest defence industry. We are by a long way Europe's two biggest defence spenders.
Achieving the envisaged level of co-operation will take time and will require changes to long-established ways of working. We will put in place measures to deliver long-term commitment to joint projects, and we expect to announce new areas of work at regular intervals.
A stronger defence relationship with France does not mean a weaker relationship with the United States, Germany, or any other partner but quite the reverse, as the increased capability and effectiveness that we will achieve through this co-operation will make us stronger partners. In the multilateral context also, our NATO allies and EU partners want UK and French forces, as well as those of other nations, to be as capable and interoperable as possible, which is exactly what the new programme of co-operation is intended to achieve."
Lord Tunnicliffe: My Lords, I thank the Minister for repeating to this House as a Statement the Answer given in another place. I start by associating myself and those on these Benches with the tribute paid to Sapper William Blanchard of the 101 (City of London) Engineer Regiment. I see once again the words in brackets "explosive ordnance disposal". The bravery displayed by those who do that job is, frankly, beyond my comprehension, and I greatly admire them.
Turning to the Statement, I protest once again that we in this House and in Parliament in general are the last to hear about this treaty being signed. The media, the French public, our allies and enemies and, I understand, the French Parliament have heard about it first. Everybody has. I will not go on about it, but we
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Having said that, because of its suddenness and brevity this Statement raises an awful lot of questions. First, there is the very ratification process. The processes for ratifying treaties in Parliament-international treaties which have no impact on domestic legislation-are extremely poor. The previous Government brought forward proposals to improve that, as the present Ponsonby convention is extremely weak, and I see some hint that we are going to do something more. I see that although two treaties have been signed, we are to have an opportunity to consider them as part of the process towards ratification. That seems rather fuller than the convention and I invite the Minister to write to me-or, indeed, to produce a Written Statement-setting out exactly how we are going to have the opportunity to debate this extremely important convention or treaty, whatever the right term for it is, because so many important matters are opened up by the very concept.
The words flowing around in the media are of a 50-year "binding agreement". Now, what does a binding agreement with the French mean? How are we going to adjudicate when we disagree? Is there going to be some supreme court for us? The history of the French nation over the past few centuries shows a chequered record on binding agreements. Indeed, there is a somewhat dark side to some of it. Of course, that will not be the case in future, but any concept of "binding agreement" has to have behind it some meaningful process otherwise, sadly, it will be just words. It is particularly difficult to envisage-I am not saying that it is impossible-how a binding agreement will survive the five-yearly defence reviews that we support. We think they are a good idea, but what will be the mechanism for those reviews?
Finally, can the Minister explain how this will change our relationship with our allies? We have this complex relationship in NATO; we are developing another complex relationship within the EU. We support those, but in among all of that we are going to have some special relationship with the French. How will that be achieved and not weaken those important relationships, particularly the NATO relationship? People-even, I dare say, of our generation-forget just how important that NATO relationship has been over the decades and how important it is that we do nothing to weaken it.
Turning to the nuclear stockpile, I found this somewhat surprising. I do not mean that it is not right but that I was not privy to the extent of this development. My understanding is that the 1958 mutual defence agreement with the US was special and complex, and that the extent of the co-operation between the two countries was extremely different. The French had to work a lot harder on the outside of that agreement. Since we are told that our American allies are content with this agreement, are we to understand that the French, in terms of support for their weapons, are going to
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We are talking about sharing a nuclear facility with the French. I think that I understand what those words mean, but how can we share that facility without sharing nuclear secrets? Do we accept that the French will have effective full access to our nuclear secrets?
The document seems to imply-once again, I am sorry that I have not read it over and over, but I have had very little time to study it-that we are making a financial commitment to the nuclear facility. This is very interesting. Does it mean that the Government, almost as an aside in this Statement, are affirming beyond all reasonable doubt that we are going to have a deterrent? The facility will not open until 2015; if we have a financial commitment to it, we are clearly going to spend substantial money on the nuclear deterrent over and above anything that we understood from the SDSR.
If this is a Statement about the deterrent, does this co-operation in any way reduce the independence of our deterrent? In simple terms, will we continue to be able to target our weapon and fire it unconstrained by any other nation? I should value the Minister's confirmation of that.
I turn to the more conventional side. To what extent does this weaken our ability to work alone? Mutual co-operation, almost by definition, ends up meaning mutual dependence. Will that dependence mean that we cannot act by ourselves? Will we, in a sense, only ever go to war again-this may be a good or a bad thing; on balance, I think the House would say that it was a bad thing-if we are in agreement with the French? They are lovely people but, over 50 years, will we always have to have their agreement to go to war, and indeed will they have to have ours? Are we in fact going to have a genuine capability for independent operation?
One cannot in these circumstances do other than reflect on the carrier. If I understand the way that the carrier decisions have gone, we are to lose our Harrier capabilities and fixed-wing strike capability, but we are going to build a carrier on which French aircraft can operate until we get our own. That is great if you say it quickly. Does that mean that, when this carrier is in the vicinity of a place where we want to take independent action, the French fixed-wing aircraft on board will go and bomb the targets that we ask them to, or will they have to call Paris first?
I have questions about the whole picture of the interdependence around the carrier. What happens when it is in refit? What happens when we lend the carrier-do we take all our secret bits out or rub all the symbols of Britishness off? It is very complicated.
Lord Astor of Hever: My Lords, I am grateful for the noble Lord's general support. With regard to his opening comments about the sapper who, sadly, was
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The noble Lord asked me about the meaning of "binding". I confirm that all treaties are binding and that as a country we are fully committed. I will write to him about the opportunity to have a debate in order to look into this matter in greater detail. I agree that it is an important issue; indeed, it is close to my heart, so I would welcome that.
"Tomorrow, the British and French Governments will sign new defence and security co-operation treaties, which will be laid before Parliament in the usual way. This follows the same principle: partnership, yes; giving away sovereignty, no".-[Official Report, Commons, 1/11/10; col. 615.]
I understood that the noble Lord asked whether the United Kingdom is now giving priority to France over other EU member states. We are working more closely with all our allies; that was obviously one of the key arguments of the SDSR. We are collaborating closely with France because, with the UK, France has some of the most capable forces in Europe and it shares the UK's level of defence spending and ambition. However, co-operation with our other European allies and partners is also vital and will remain a fundamental part of our approach. Existing co-operation will continue. For example, the UK/Netherlands amphibious force will remain in operation. We are also looking to increase bilateral co-operation with EU partners such as Germany, Italy, the Netherlands and Spain, with which we have a history of close equipment or other defence co-operation. We will also increase our engagement with smaller and newer states in the EU.
The noble Lord asked about the UK/France nuclear collaboration and how it might affect the United States. We are satisfied that our proposals are fully compliant with our obligations under the mutual defence agreement and Polaris sales agreement with the United States. The Prime Minister and the Secretary of State have both made a commitment to renew the deterrent. It does not in any way reduce the independence of use of our deterrent.
The noble Lord asked whether the UK would have to join France if it decided to invade another country. The answer is no. Only a UK Government will ever decide when to deploy British troops, with whom and under what conditions. Article 5 of the treaty confirms that deployment and employment of the armed forces of each party remains a national responsibility at all times. Both France and the United Kingdom will continue to maintain a full spectrum of capabilities. This will allow us to deploy independently, should France choose not to be involved, and vice versa. Decisions by either country to support the other in an operation where only one is engaged will be taken nationally on a case-by-case basis.
Lord Lee of Trafford: My Lords, I join these Benches in the earlier tribute. My noble friend will know that on many occasions I have argued for greater co-operation between Britain and France. Thus, I am very encouraged by the defence treaties signed today. According to media reports, the chief executives of BAE Systems and Dassault have written to their respective Governments, making the point that greater collaboration in the production of future combat aircraft and UAVs is absolutely vital. Does my noble friend not agree that, to make collaboration easier, there has to be greater consolidation between defence industries and, particularly, between British and French defence companies?
Lord Astor of Hever: My Lords, I am well aware of my noble friend's views on greater co-operation with the French, which I share. When we were in opposition, I went to France with the Secretary of State. We had a fruitful day's discussion with French leaders, military and civilian, at the highest level. As far as the unmanned air systems are concerned, these have become central to both our armed forces. We have agreed to work together on the next generation of medium-altitude long-endurance unmanned air surveillance systems. Co-operation will enable the potential sharing of development, support and training costs and ensure that our forces can work together. We will launch a jointly funded competitive assessment phase in 2011 with a view to new equipment delivery between 2015 and 2020. In the longer term, we will jointly assess requirements and options for the next generation of unmanned combat air systems from 2030 onwards, building on work already started under the direction of the UK/France high-level working group. Over the next two years, we will develop a joint technological and industrial road map, which could lead to a decision in 2012 to launch a joint technology and operational demonstration programme from 2013 to 2018.
Lord Gilbert: My Lords, does the Minister understand some of the risks involved in what he has just been talking about? It is clear to everybody that our relationship with the United States makes what he has been talking about pale into insignificance. I have two questions. First, President Obama recently fired his Director of National Intelligence because he recommended that the United States should create with France the arrangements that have existed between us and the Americans for many years, whereby neither country engages in intelligence activities on the soil of its partner. Is it contemplated that we will engage in such an agreement with the French? Secondly, will the Minister be so kind as to tell us exactly what arrangements are being made with respect to our access to the research establishments of the American defence industry? This in my view is by far the most important element in the special relationship. I hope that I can have his assurance that nothing at all will be done to weaken that and therefore that the French will have to be told-will they not?-that we are going to share a whole lot of things with the Americans that we are not going to share with them.
Lord Astor of Hever: My Lords, I say to the noble Lord that there are obviously risks in everything. The Opposition when they were in government had similar discussions with the French and I am sure that they would have come up with a similar arrangement to what we have come up with. I share the noble Lord's views on relations with the United States. I have always expressed those views. In fact, I have just come back from Qatar. I spent all of yesterday with United States forces out there and admire absolutely everything that they do. I give the noble Lord the assurance that we will do nothing to weaken our relationship with the United States. There is nothing here that will weaken that relationship.
Lord Maples: My Lords, I wholly welcome the Statement. If the European arm of NATO is to mean anything, enhanced co-operation between France and the United Kingdom is very important, but the big problem that we both have is over procurement. We cannot afford the equipment that we want and neither of us has a good system for managing procurement projects. The history of this is not very encouraging. The French did not participate in Tornado or Typhoon, while the Horizon joint project to build a frigate-one of the simpler naval vessels-collapsed about 10 years ago because we could not agree on the shape of the hull. The acid test of this agreement will be whether we can make a joint procurement project work. The noble Lord has mentioned UAVs, but that seems to be a research project. Can he say when the first effort between the two of us to develop a major piece of military hardware together will occur?
Lord Astor of Hever: My Lords, it is far too early to be that specific; the treaties were signed only this afternoon. However, all our weapons will need to be replaced at some point. The Typhoon and the Rafale will need to be replaced. There are huge areas where we can co-operate with the French. We start off with the UAVs.
Lord Touhig: My Lords, I entirely endorse the comments by my noble friend on the Front Bench that Parliament should be the first body to be told of an important matter such as this, and it is not sufficient for the Minister simply to say that it was trailed by the Prime Minister in the other place yesterday.
However, I certainly welcome the progress that is being made in closer co-operation with our French neighbours. They are our closest neighbour, a good ally and, now that they have rejoined NATO, there is a great opportunity for us to work more closely together. In President Sarkozy we have the first President at the Elysée palace in my lifetime who does not have a problem with the British-American special relationship, and that is good. However, if closer co-operation with our French neighbours is to succeed, three elements are necessary. There must be political buy-in, military buy-in and a buy-in from the defence industries. There will certainly be a political buy-in, and I know that my colleague on the other side, the noble Lord, Lord Lee of Trafford, with whom I was recently at a meeting in Paris, agrees. I am also certain that there will be a buy-in from the defence industries. However, after
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Lord Astor of Hever: My Lords, a big effort will be made to get a lot more of our troops to learn French, which will be a good start. I meet a lot of French officers, sailors and air men and women in a lot of different ways, and they tend to speak brilliant English. I welcome anything that gets France back closer into NATO. As the noble Lord said, President Sarkozy has been very brave in bringing France back to the centre of NATO and I will encourage anything to see that that continues.
Lord Martin of Springburn: My Lords, I asked a question earlier and I ask it again. My concern is on the military chain of command. For example, every officer in command and all troops in the British Army give an oath of allegiance to Her Majesty the Queen. Given these new circumstances, can the Minister put information in the Library as to how this will work? There could be commanding officers who have not made that allegiance to Her Majesty. In this day and age, we have to protect our soldiers to ensure that they never face a court martial because they understood that they were entitled to reject an order from someone from another country.
Lord Astor of Hever: My Lords, I am quite happy to put that in the Library. This concern can be exaggerated. France and the United Kingdom have been in NATO together for many years, we have served happily together, and I remind the noble Lord that the French and the British fought successfully together in World War 1 and World War 2. In World War 1, we served under General Foch. My grandfather was a British commander-in-chief and he was very happy to take his orders from him.
Lord Selkirk of Douglas: My Lords, can the Minister say a little more about the implications of strategic co-operation with France on maritime reconnaissance? Can he confirm that there will be a sufficiency of European sea and air resources to combat piracy off Somalia, and that, in particular, when the Nimrods come off the supply line, they will for the time being be mothballed, not dismantled?
Lord Astor of Hever: My Lords, I cannot give my noble friend the assurance on his last point regarding the MRA4, but I can assure him that we are working closely with the French on maritime reconnaissance and on how we can help each other on that. As regards piracy, we are part of the EU's Operation Atalanta, which also involves other nations.
Lord Davies of Stamford: My Lords, like the noble Lord, Lord Lee, I have long been a strong promoter of the idea of greater defence co-operation with our European allies, particularly the French. When I was in government I started a number of initiatives along those lines, including the Mantis UAV programme,
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Will the Minister confirm that as the deployment of the Armed Forces under this treaty will be a matter for national decision on a case-by-case basis, the treaty will do nothing to fill the enormous gaps created in our defence capability by the Government's strategic defence review? For example, the fact that we are not going to have any aircraft on our carriers for 10 years will not be compensated for by the fact that the French might be able to fly off the carriers, because they might decide not to take part in an operation that might arise, for example, to defend the Falklands, where purely British national interests are at stake.
Lord Astor of Hever: My Lords, I am sorry that the noble Lord was not here when I read out the Statement. Having said that, I am aware of the part that he played in securing greater co-operation with the French. The noble Lord said that we would have carriers with no aircraft flying off them. The idea is that the aircraft and carrier will come in at the same time. We will put the cats and traps on the carrier when the JSF comes in, in 2019 or 2020.
Lord Morris of Aberavon: My Lords, I recall that, when I was a Minister for Defence a long time ago, the United Kingdom had a certain degree of dependence on the United States, and we were governed by fairly tight treaty arrangements for the maintenance of our so-called independent nuclear deterrent. There were limitations in particular on the sharing of knowledge. What happens to knowledge or material that the United States is prepared to share with us but with no one else?
Lord Astor of Hever: My Lords, that is a very good question. I have reams of briefing on this and it would probably be better if I wrote to the noble and learned Lord in reply, because it is a technical question.
Lord Anderson of Swansea: Is there not a danger of misunderstanding with the French on two matters? First, the French are notoriously nationalistic in their defence procurement. How will that square with what the Statement says about mutual access to each other's defence markets? Will the French alter their position, as they clearly have not done, for example, on rolling stock for the Channel Tunnel? Secondly, is there not a danger of a misunderstanding in terms of British and French attitudes? Throughout, the British have stressed independence and sovereignty and have not dared to whisper the name of the European Union. The French, of course, share a brigade with Germany, and will do nothing to stand in the way of closer co-operation within the European Union. Therefore, is there not a danger of misunderstanding, given our Defence Secretary's rather narrow, nationalistic views and the French view of how this will develop?
Lord Astor of Hever: My Lords, in answer to the noble Lord's first question, we are committed to improving access to each other's defence markets. This commitment is clear in the defence and security co-operation treaty.
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Lord Boyce: My Lords, I declare an interest as a non-executive director of WS Atkins. Does the Minister agree that there has been a certain amount of overreaction and hype with regard to some aspects of this initiative, especially naval co-operation? Does he agree that we have provided escorts with great success to the French carrier battle group, and vice versa, over the past 15 years or so? However, will he also acknowledge that he has been somewhat complacent when he says that we will maintain a full spectrum of capability to allow independent operations? This simply will not be the case with carrier strike when only one carrier is available. Does he agree that this will be an area of high risk in our ability to operate independently, and in the ability of the French to operate independently, when we are in a one-carrier situation? Does he agree that it is difficult to imagine how we will mitigate the risk in the years to come?
Lord Astor of Hever: My Lords, I agree with the noble and gallant Lord about the overreaction and hype. There are a lot of successes. I have been on a number of Royal Navy ships and have witnessed our personnel exercising very successfully with the French and indeed socialising with them afterwards. I have seen warm relations between the two navies; it is the same with the Royal Air Force and increasingly so with the Army. I am looking forward to witnessing Operation Flanders next spring, when our two armies will be exercising together in northern Europe. There are obviously risks in everything that we do, but we have considered this matter carefully and believe that the risk is manageable.
Lord Burnett: My Lords, I am reassured by my noble friend saying that none of this will in any way jeopardise our close links with our allies in the United States. He talked about achieving better value for money for the British taxpayer. Does he believe that there will be any savings and, if there are, will they be retained by the Ministry of Defence? Furthermore, will some of those savings be used to retain our Harrier aircraft, which are vital to our defence capability?
Lord Astor of Hever: My Lords, I wish that I could give my noble friend the answer that he is looking for but, sadly, I cannot give him that assurance. As I said last week, this was a difficult decision. We looked at the matter very carefully. The decision to retire the Harrier fleet from next April was taken with the greatest reluctance and only because that was the military advice. As politicians, we have to accept military advice.
Lord Soley: I think that it is the turn of this side-my patience is being rewarded. I welcome the Statement and the two agreements, but I really do not like the
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Lord Astor of Hever: My Lords, I do not accept the premise that the noble Lord makes and I did not feel that I was putting any spin on the matter. I was simply trying to point out the reality of the situation.
Lord Inglewood: My Lords, can my noble friend tell the House whether the Government have any aspirations to extend this new relationship between the United Kingdom and France to any other countries in the world, be it the United States or other members of the European Union?
Lord Astor of Hever: My Lords, we have always had excellent relations with the United States and I know that those will continue. We talk to other countries in the European Union and to our NATO allies at all times, but this Statement was about relations with France, which I very much welcome.
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