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The noble Baroness, Lady Emerton, powerfully emphasised the importance of chemotherapy at home. The NHS operating framework for this year confirmed the direction of travel towards having more services closer to home. Where there are skilled and experienced staff, chemotherapy in community settings can help to meet increasing demand and provide greater choice for patients.

The noble Baronesses, Lady Finlay and Lady Thornton, asked about our tobacco policy. At the moment, we are considering options for the display of tobacco in shops. We seek to balance public health priorities with reducing burdens on business. Those matters are under consideration by Ministers. It is probably premature for me to discuss the details of the options that we are considering, but an announcement will be made in due course.

I am aware that time has run out. Suffice it to say that I believe that this has been an excellent debate. I undertake to write to those noble Lords whose questions I have not been able to cover. I think that we all agree that advances in medical science mean that cancer is no longer the death sentence that it once was. That is a cause for satisfaction and for congratulating those cancer specialists in the NHS who do such wonderful work. We want to build on those achievements to take cancer care to new heights, to ensure that those beginning treatment for cancer do so with confidence and hope.

2.01 pm

Baroness Finlay of Llandaff: My Lords, I thank the Minister for his reply and all noble Lords who have spoken in this outstanding debate. I particularly thank the noble Lord, Lord Howard of Lympne, for having decided for his maiden speech to contribute to this debate. He raised the tone even higher than that set by everyone else in this House.

There are some very clear messages here. People want the choice to be treated well at all times and, to cite the title of the book by the late Lady Beecham, to be moving forward with their cancer and living with it. Integration, not fragmentation, must be the way that the changes take us in the new world that we face. Outcomes can and must improve. Prevention must continue. We must not lose sight of tobacco control.

I finish simply. There has been a call for information from around the House. In the words of the late Vicky

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Clement-Jones, whom I had the privilege to know, knowledge is the antidote to fear. This debate has demonstrated that.

Motion withdrawn.

Welfare Reform


2.03 pm

The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud): My Lords, with the leave of the House, I shall repeat a Statement on welfare reform made earlier today in the other place by the Secretary of State, Iain Duncan Smith. The statement is as follows.

"In this House, in October, I set out our resolve to secure a welfare system fit for the 21st century, where work always pays and is seen to pay.

Following consultation, a broad positive consensus has emerged-from Citizens Advice to the Institute for Fiscal Studies, and across the political divide. The White Paper that we are publishing sets out reforms to ensure that people will be consistently and transparently better off for each hour they work and every pound they earn. We will cut through complexity to make it easier for people to access benefits. We will cut costs, reduce error and do better at tackling fraud. The detail is published today and the White Paper is available in the Library. Let me take this opportunity to thank all who have helped build and write these reforms.

Let me remind the House of the problem that we are trying to solve: 5 million people of working age are on out-of-work benefits; 1.4 million people have been on out-of-work benefits for nine of the past 10 years; 2.6 million working-age people are claiming incapacity benefits, of which about 1 million have been claiming for a decade; and almost 2 million children are growing up in workless households-one of the worst rates in Europe.

Some have said recently that it is jobs-not reform-that is important, but in doing so, they miss the point. This is a long-standing problem in this country. We have a group of people who have been left behind, even in periods of high growth. Even as 4 million jobs were created over 63 quarters of consecutive growth, millions of people in Britain remained detached from the labour market. Four and a half million people were on out-of-work benefits even before this recession started. These reforms are about bringing them back in. I want them to be supported and ready to take up the 450,000 vacancies that are currently available in our economy. If we solve this problem, we begin to solve the wider social problems associated with worklessness.

The measures in the White Paper get this process under way. They are the first key strand of our welfare reform. By creating a simpler benefits system, we will make sure that work always pays more than benefits. By reducing complexity, we will reduce the opportunities for fraud and error, which currently cost the taxpayer more than £5 billion a year.

Work is the best route out of poverty. At present, some of the poorest who take modestly-paid jobs can risk losing £9 or more out of every £10 extra they earn.

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The universal credit puts an end to some of those perverse disincentives that make it so risky for the poorest to move into work. The highest marginal deduction rates for in-work households will fall from 95.8 per cent to 76.2 per cent. That is the absolute maximum, incorporating both tax and the withdrawal of benefits. There will be a single taper rate of about 65 per cent before tax. That means that about 1.3 million households facing the choice to move into work for 10 hours a week will see a virtual elimination of participation tax rates of more than 70 per cent. With single tapers and higher disregards, the system will be simpler and easier, and people will keep far more cash in their pockets when they move into work.

Our guarantee is crystal clear: if you take a job, you will receive more income. Some 2.5 million households will get higher entitlements as a result of the move to universal credit. The new transparency in the system will also produce a substantial increase in the take-up of benefits and tax credits. Taken together, we estimate that these effects will help lift as many as 350,000 children and 500,000 adults out of poverty. That is our analysis of just the static effects of reform. Analysing the dynamic effects is not easy, but we estimate that the reforms could reduce the number of workless households by about 300,000. Let me also provide assurance about the transition. We will financially protect those who move across to the universal credit system. There will be no losers.

A far simpler system that operates on the basis of real-time earnings will also reduce the scope for underpayments and overpayments, which we all know can create anxiety and disruption and can prove very difficult to correct. This simplification and reform will help end that problem. As well as reducing official error, these changes will also make life far more difficult for those who set out to defraud the system-they are a small group, but nevertheless they are there. The system will be simpler, safer, more secure, fairer and more effective.

That will require investment, with £2.1 billion being set aside to fund the implementation of the universal credit over the spending review period. I have been assisted in this work by my right honourable friend the Chancellor, who has agreed to this investment programme. This is not just expenditure but investment, and investing to break the cycle of welfare dependency is a price worth paying. The universal credit will provide a huge boost to the individuals who are stuck in the benefit trap by reducing the risk of taking work and lifting 850,000 out of poverty in the process.

This investment will produce a flow of savings, as a simpler system helps drive out over £1 billion of losses due to fraud, error and overpayments each year. In the wider economy, dynamic labour supply effects will produce net benefits for the country as greater flexibility helps business and fuels growth, particularly in the high street. We are investing £2.1 billion in spending review 2010, and we are seeking a multibillion pound return.

That is how we will make work pay, but that is not enough on its own as we also have to support people as they make their move back to work-the two issues cannot be separated. That is why we are moving ahead

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with our new work programme, which will provide integrated back-to-work support, and that is why we have already started a three-year programme to reassess 1.5 million people who have been abandoned for years on incapacity benefit-something that the Opposition started before the election for the flow of new claims. We are now trialling that programme in two cities in the UK.

This is our contract: we will make work pay and support you through the work programme to find a job, but in return we expect you to co-operate. That is why we are developing sanctions for those who refuse to play by the rules as well as targeted work activity for those who need to get used to the habits of work. This work activity will be targeted at those who need it most: those who face the most significant challenges engaging with the labour market. Furthermore, evidence from the work capability assessment-36 per cent of people have withdrawn their application before reaching the stage where they are assessed-underlines the effect this could have on those currently working while claiming benefits.

This new contract represents a fair deal for the taxpayer and a fair deal for those who need our help. I commend these reforms and this White Paper to the House".

My Lords, that concludes the Statement.

2.12 pm

Lord McKenzie of Luton: My Lords, I thank the noble Lord, Lord Freud, for repeating the Statement that was given in another place today and acknowledge his personal and detailed engagement in the development of these proposals. On this side, we are grateful for advance sight of today's Statement. Beyond the normal courtesy of being sent an advance copy and being able to hear it in the other place, we have of course been able to read about it in the newspapers over the past couple of months.

On the substance of the Statement, we have always been clear that we agree with the broad principles of what the Government are doing. We made good progress through the introduction of tax credits and the minimum wage to make work pay, and we made good progress in reducing the number of workless families by 350,000 and the number of unemployed lone parents by a similar amount, but there is plenty more to be done. The system is too complex at present.

The right honourable Secretary of State and the Minister have on more than one occasion gone on the record in acknowledging the work that we did in government that they are building on. We agree that work is the best route out of poverty and we agree with strong conditionality in the welfare system so that benefit recipients get something for doing something. We agree with the principle of a single welfare-to-work programme-we were introducing the personalised employment programme to do just that but at a much more modest pace than the Government are proposing in the work programme. In successive policy, we set out our long-term aspiration for a single working-age benefit papers that would simplify the system, as the universal credit seeks to do. Attaining that would be a

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significant technical as well as policy achievement, so on our part there is no opposition for opposition's sake.

On this side, we will offer constructive opposition to try to help the Government make their principles a successful reality. It is in that spirit that I raise some concerns. First, it is right that there should be a contract setting out the expectation between the state and the claimant to enshrine the something-for-something nature of things, but as well as providing benefit is there not an obligation on the state to grow employment? Will the Minister agree to publish, perhaps with his friends in the Treasury, targets for employment growth and unemployment reduction? I notice the claims in the media, which we have heard repeated today, that the tougher conditionality will reduce unemployment by 350,000. I would be interested to see the evidence supporting that.

The noble Lord, Lord Freud, will recall our extensive debates on conditionality during the passage of the Welfare Reform Act 2009. In particular, he will recall the consensus that lone parents, particularly mums, should not have to be available for work outside school hours, that there needs to be affordable childcare and that transport costs should be taken into account in assessing availability for work. Can the Minister confirm that tougher conditionality is not to weaken these protections and that good cause will still apply? What is proposed for the protection of children when benefits are withdrawn? Will hardship payments still be available and, if so, at what level of benefit?

Through the future jobs fund and the young person's guarantee, we found that offering a real job on the minimum wage lifted people's aspirations and got a lot of really good work done for the community. That is what the unemployed-all the way back to the "Boys from the Blackstuff" in the 1980s-have always wanted: they want a job. The new work programme is dependent on successful job outcomes, so they need this too. When will the Government publish a credible plan for jobs growth? The Bank of England said this week that the prospects for growth are highly uncertain, but it is certain that more than 1 million people will lose their jobs as a result of the comprehensive spending review. Can the Minister give hope to those who are currently unemployed that the number of vacancies will start increasing again?

The benefit of work is in building self-confidence and self-esteem. How will the work experience proposals offer that and other gains such as something on the CV and a good reference? How will it be different from the community payback work that we successfully introduced in government? Will it just look like another form of punishment? How will he find these work placements and guarantee us and the work programme providers that the scheme will not just displace other jobs that are needed to get people permanently off benefit? In our experience, as with apprenticeships, it is easy to announce the policy and the funding, but it is much harder to persuade employers to take them up.

On universal credit, there are many points of detail that we wish to explore about how the credit will operate, but those questions are mostly for other occasions. We recognise that the proposal is ambitious, but can

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the Minister comment on the reports that, in order to fulfil the commitment that no one will be worse off under the proposals, up to an additional £2 billion a year will be required after 2016? Given the time that will be taken to introduce the universal credit, has any thought been given to utilising the better-off-in-work credit in the interim?

We will need to explore the detail in the White Paper on what is included within the credit. Can the Minister say today whether DLA is in or out and whether it is to be subject to the taper? Given that the previously announced decision that council tax benefit-with a 10 per cent cut, of course-is to be devolved to local authorities will potentially lead to differential arrangements up and down the country, what is the Minister's understanding of what that will mean for the universal credit?

There has been much debate about the draconian changes to the housing benefit regime. In due course, we will want not only to unpick the evidence base on which that is predicated but to look for answers, which to date have not been forthcoming. Will the universal credit allow the separate net identification of components of the credit, given the possible combination of overall caps, individual rent caps and the standard tapers? Does that preclude the direct payment of rent to RSLs and landlords in the private rented sector? If child benefit is to be included, how does the Minister respond to the point that one consequence will be potentially to reverse the hard-won campaign that such support should be a resource that transfers from the pay packet to the purse?

I reiterate our concerns about what is being cut to pay for the proposals. The arguments setting out our opposition to the unfair and damaging cuts to housing and child benefit are well rehearsed and will be made again and again. I should also say that the noble Lord could avoid these damaging cuts by taking more time and, in doing so, he could possibly lower the risks around the delivery of the proposals. We can achieve political consensus on this and agree a programme that goes beyond a single Parliament. That would allow time to build employment in the economy, get reassurance about the success of the IT upgrade on which the universal credit is dependent and allow a smoother transition from the flexible New Deal to the work programme, thus avoiding a damaging gap in provision that potentially will hurt contractors and, more important, vulnerable job seekers.

Let me be clear that we support the strategic direction of the proposals, but what counts is the decency with which they are implemented. We will work constructively with the Government to seek to ensure that that is the case.

2.21 pm

Lord Freud: My Lords, I thank the noble Lord, Lord McKenzie, for his gracious speech. I welcome his overview that this transformation is going in the right strategic direction and that he and his party are prepared to make sure that we get the very best out of it. There is much consensus around this issue and, as anyone who has looked at my career over the past few years will recognise, it may be that I almost personalise some elements of that consensus. I do acknowledge, as

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the Secretary of State has acknowledged, that we are building on elements, but we are making them truly transformational by ensuring that people will be able to understand that it is always worth working in a way that, because of the complexity of the current system, it has been impossible for them to do.

The noble Lord put a series of questions to me and I shall do my best to answer all or virtually all of them. He queried the obligation, as he put it, in the contract to grow employment at the same time. I want to make it clear that two separate things are happening here. In the 16 or 17 years to 2008 we had the longest boom in growth that this country, in common with the rest of the western world, has seen. However, we still ended up with a lot of people trapped on out-of-work benefits. What is key here is to untrap them because during the boom we were sucking in labour from abroad which proved to be much more flexible. Before we worry about anything else, we must unlock the people who are living here so that they can play their part in the workplace. That is what these reforms are about.

On the noble Lord's question about lone parent conditionality, we will of course maintain the good cause provisions that are agreed. We are very sensitive to the school hours measures and so forth, and they will be taken through. Hardship payments will be available, and the exact levels will have to be determined. He made the point that people need self-confidence and good self-esteem to be able to get back into work. The whole point of the work programme is to put in place a structure where providers are incentivised to get people back into the workplace whatever it takes. My own expectation, for what it is worth, is that one of the things that work providers will spend a lot of time on is rebuilding the self-confidence that people need to get back into work. So I expect that to be happening.

We have talked about mandatory placements. They are not a punishment, but are to be used for those for whom working for four weeks will be transformational in how they interrelate with work and in getting used to the basic disciplines of work. The placements will be designed for those people for whom we think they will be of the most value. Clearly there is a secondary issue, which is that making people do something for four weeks when they actually have another job anyway is a useful winnowing tool.

The noble Lord queried the costs and mentioned stories about an extra £2 billion in the next Parliament or at the next spending review. Frankly, we are talking about a very complicated series of movements, and any figures at this stage would be simplistic. The point is that by the next Parliament, the new system will be locked in, so that in the next spending review we will have to take account of what that system is, along with its costs.

I am not sure whether we will be running ahead with the "better off in work" credit because there is so much to do in bringing forward the universal credit. We need to concentrate on the big picture rather than amelioration of bits and pieces of the existing system. The plan is to bring in the universal credit from October 2013 and then start to move as soon as we possibly can the people for whom those incentive effects will work the best. They will be the earliest people to move across.

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I can assure the noble Lord that the disability living allowance is out of the universal credit because we accept the reason for the allowance, which is to provide for all people with disabilities who need help with the costs involved in their support, whether they are in work or out of work. Those costs do not change in line with levels of wealth. They represent a basic strapline of expenditure according to an individual's disability, so we have decided to leave DLA out. On council tax benefit or rebate, depending on what we call it, we are looking to devolve this so that local authorities can start to shape where it goes. We are also determined to make sure that it works with the incentive structure of our taper on the universal credit. This will ensure that we do not have something working against that set of incentives.

I turn to housing benefit, which is effectively one element of the universal credit. We have some work to do on exactly how it will go in and at what rate, but in practice the universal credit is a basic credit with disability add-ons, child add-ons, housing add-ons and so forth. We aim to see the portfolio of an individual's universal credit build up depending on who they are. On the question of direct payments to RSLs, we will make sure that the risks to RSLs in terms of getting payments are not increased. Their anxiety is that their ability to finance will be undermined, but we are determined to ensure that, whatever we do with this, it does not undermine that ability. We are looking at quite a few options where we can achieve our aim without necessarily having direct payments.

Is child benefit included? No, it is not. As to the noble Lord's concern about wallet and purse, which would apply also to the universal credit-he did not ask the question but I am happy to answer a question he did not ask but should have-we want to ensure that the credit gets paid to one member of the household, although we will explore ways of dividing it. One hundred per cent may well go to the purse or to the wallet, but we need to consider the middle and whether we should make special arrangements for those people who would like it there.

The noble Lord asked me to take more time. This is a big project and we are doing it at the speed we can. Nevertheless, it will take a long time. We will have the system ready to roll in October 2013 and people will migrate steadily on to it; we will not throw everyone in at the same time. Up to half of the people involved-particularly those who are most incentivised by being in the system-will be in the system by April/May 2015, and the remainder in the next two years. It is a longish process.

I welcome the noble Lord's closing words-that this will go beyond a second Parliament-but one never knows what will happen in an election. I welcome the fact that the party opposite has indicated that it will be supportive and co-operative because you never know who will be in charge in 2016.

2.32 pm

Lord German: I congratulate the Minister on the Statement, particularly on him and his team securing £2.1 billion of expenditure to overhaul a system that has had many epithets, including "complex", "cumbersome"

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and "inefficient". I am sure that if we wrote a dictionary of the problems of the current system, we would see the need for making progress towards change.

I am keen to explore the key area of the Statement-that 850,000 people in our land will be lifted out of poverty as a result of these measures. That would be a tremendous achievement for the Government, one which we have not seen in the past. Can the Minister explain how that figure is arrived at and the Government's direction of travel? It is an aim worth achieving in itself, although it is not the only ambition they have.

Given that there will be a long period of transition, how will the existing benefit structure begin to look to the new benefit structure? Clearly you do not want to continue the old system and change rapidly; you will need to ensure that the sense of direction is towards the new structure. I am sure the House will wish the Government every good speed in doing this, but "crawling" is not the epithet that I would use at the moment.

Lord Freud: I thank my noble friend Lord German for raising the issue of the impact on poverty. I have a much shorter word on record: it is not "complex", "cumbersome" or "inefficient"; I call it a mess.

How will this work? In effect, by having more generous tapers and disregards we are putting money into the pockets of people doing small amounts of work. So there is the direct economic impact of that money going in. There will be a second order impact, which will be twice as large because we will simplify the system and have only one form. This will encourage a much higher take-up rate and, in practice, will almost eliminate the scourge of in-work poverty. So that is where the figure of 850,000 comes from.

There will also be the dynamic or incentive effect of always knowing that it is worth working, and being incentivised to work will reduce the number of workless households by about 300,000. We have not put that poverty impact in the Statement; it is in addition to it. Some households will be pulled above the artificial 60 per cent median line, and we expect the poverty impact to be even greater than the 850,000 we have referred to. These are big figures. I remind the House that, on conventional analysis, the reduction in child poverty during the 13 years of the previous Government was about 600,000 children, so we are looking at making a big relative effect in one go.

Lord Clinton-Davis: I wish I could share the Minister's optimism. I believe that immense difficulties will arise in practice.

I wish to ask about handicapped people. Are any changes envisaged in this approach in regard to those claiming to be handicapped? Will they have a right of appeal if they are turned down-after all, experts can be wrong-and will legal aid be available in the vast majority of cases? If it is denied, that will not be fair-and, after all, fairness goes to the heart of what we are talking about.

Lord Freud: I thank the noble Lord, Lord Clinton-Davis, for his question. I hope I am not being too optimistic. On the handicapped issue, there are a few concepts buried in the question and I shall try to disentangle them.

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First, how does the universal credit look to a disabled person? In the present system we have a conflation between disability and inactivity in the labour market. It is one or the other; you can do a little work, but not much. The beauty of the universal credit is that people on disability benefit will be on the same taper as others, with generous disregards, so that they are not in the desperate position of being inactive on disability benefit or working. We should remember that 40 per cent of people with disabilities are in the workforce-they want to be in the workforce-and that some of the most heavily disabled people want to work. We want to build up a system to help them to do so.

The second element of the noble Lord's question deals with the work capability assessment process that we are now trialling. There will be an independent and elaborate tribunal process through which people can go. They can bring in legal support if they want but, in reality, most people do not need it because it has been accepted as a relatively balanced process, and robust systems will be in place to make sure that people do not get put into the wrong category. However, putting the money aside for one minute-clearly one likes to have more money than less and to be on a higher rather than a lower benefit-the reform will unlock the inactivity that we are in effect forcing on too many disabled people.

Lord Bilimoria: My Lords, I served on the New Deal taskforce for many years and then on the National Employment Panel for seven years. I am delighted and heartened by many of the initiatives in the Government's programme for welfare-to-work reform, in particular tackling the benefits trap.

We used to talk about the Australian experience. I spoke to John Howard after he stepped down as Prime Minister and asked him about Australia's welfare-to-work experience, which we used to look to as a great success. He said that he did not want to remove the safety net but to get people back to work. One way in which his Government had sought to do that was a programme whereby people were made to do some community service. He thought that it would be a very unpopular move; it turned out to be very popular, because people who worked and paid taxes did not like to see people, quite a few of whom could have worked, not working. As a result, the Australian Government got public support for it. Have the Government looked at the Australian experience? Have they learnt from it? Do they think that it was a good and effective scheme, and will their scheme be as effective?

Lord Freud: My Lords, I thank the noble Lord, Lord Bilimoria, for that question. We have spent a lot of time looking at the lessons from abroad. When I was doing an independent report three and a half years or so ago, Australia was one of the places that I looked at very closely. I had someone who had been working there to inform me about what was happening. Australia and Holland are two places from which we learn a lot of lessons. There is a debate about whether action should be mandatory or voluntary. Voluntary action works if people have the self-confidence to say, "Yes, I want to try something", but when you have been out of work for a long time, one of the first things that goes is your self-confidence. That is why

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mandatory action is not cruel. You need to pick people up and make them do things, because they do not have the self-confidence otherwise. That is one of the main lessons to be learnt from the Australian experience.

Lord Mawhinney: My Lords, perhaps I may say how many of us appreciate the fact that, in trying to unlock lives and aspirations, the Minister is focusing on allowing people to keep more of what they earn and trying to build self-confidence. There may be two other locks that he needs to unpick. The longer someone has not been in employment, the more inadequate or perhaps absent altogether will be their education and training. It would be my guess that those locks will need to be unpicked for very many people. Does he share that view? If so, who will have responsibility for addressing proven lack of education and training, and who will pay for it?

Lord Freud: My Lords, I thank the noble Lord for that question. I not only share his concern but am very firmly on the record as being very concerned about the division between the Work First strategies that we have been adopting in this country and skills and training. One of the mainstream drivers of the work programme philosophy is an attempt to pull training and employment strategies together. It does that partly by price differentiation, so as people become tougher to put into work, the price goes up. We need to find the right mechanisms to make sure that we price up. It does it also by ensuring that the payments system in the work programme is based on sustainment in work, which can be for one, two or three years. You do not sustain someone in work for a long time unless you pull in the whole training and education element. That kind of change should be going through.

Lord Christopher: My Lords-

Lord Beecham: My Lords-

Lord Young of Norwood Green: My Lords, I, too, welcome the direction of travel of the Government. If there is a doubt, it is about whether, after the comprehensive spending review, their growth strategy is coherent. The Statement referred to 450,000 vacancies, but that is before we have seen the impact of the comprehensive spending review. The Minister has just mentioned skills. We have concern about the Government's abolition of the Train to Gain programme and the funded NVQ programme.

I shall focus on two areas on which I would welcome some further explanation. As I think the Minister would readily acknowledge, matching people to jobs will in some cases require an awful lot of support. In the other place, the Secretary of State talked of mentoring, not only to get people into work but to provide support when they are in work. The Minister has spoken of integrated back-to-work support. Who will provide this support and will it be resourced and properly costed?

The Secretary of State denied in the other place that the Access to Work grants had been cut, saying that they had just been refocused on larger employers.

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However, on other occasions, the Minister has stated that job growth will come from SMEs. That is a contradiction. If the Government want people with disabilities to get back into work, Access to Work grants are an important part of creating employment opportunities.

Lord Freud: My Lords, I thank the noble Lord, Lord Young, for that question. We have an integrated strategy. Measures in the CSR will ensure that mentoring takes place; there is also the new enterprise allowance and so on. We are building those packages and will announce details in due course. Our main change to Access to Work is to make sure that when someone goes for a job they have the funding required. No one will take someone if they do not know whether they will receive Access to Work. That is the main way in which we are refocusing Access to Work, which we think is a good programme.

Baroness Thomas of Winchester: My Lords, I, too, warmly welcome my noble friend's repeated Statement today. I have one very simple, fundamental question to which I do not know the answer. How much discretion will decision-makers at Jobcentre Plus have about the sorts of work that jobseekers will be compelled to take? We hear that the conditionality rules will be tougher than those set by the previous Government. Let us suppose that a graduate or a highly qualified person can find only a cleaning job. Will they be compelled to take it and does the decision-maker have any discretion about that?

Lord Freud: My Lords, I thank the noble Baroness, Lady Thomas, who has been incredibly involved and interested in the development of the universal credit. Jobcentre Plus is structured in such a way that there is a very light touch in the early months which becomes gradually firmer and starts being a heavy hand on the shoulder after six months. There is a reality period. Most people look after themselves and find a job, but some need to have the reality of their position in the marketplace brought home to them, so that they match what work they can realistically expect to do with what is out there. You are much better off being in work and looking for a better job from an in-work position than from an ever longer period of inactivity.

Baroness Afshar: My Lords-

Lord Christopher: My Lords-

Noble Lords: Cross Bench!

Baroness Afshar: Thank you very much. I am very grateful that you allowed me in. I have two related points. First, the welfare legislation that did not get final approval put the welfare of children at its centre. It was the first thing that was stated. Can we hope that the current measures will begin with that statement?

Secondly, there are minority women, particularly Muslim women, who would find it very hard to front up and be consulted by a man who told them what to do. We need to have much more appropriate arrangements, because jobcentres have targets to meet. A specific

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woman may not want a job that staff think is appropriate. We need leeway and I wonder whether there will be room.

Lord Freud: I thank the noble Baroness, Lady Afshar. Children are at the heart of this. In our view, intergenerational poverty and joblessness are the basic reasons for the much too great child poverty that we have. This measure is designed with children in mind-right at the heart.

I take the noble Baroness's point about cultural differences. One of the things I expect to see in the work programme-I know it is not in Jobcentre Plus-is quite sophisticated addressing of particular cultures. It is designed to force individualisation. In the work programme at least we will see start the kind of responses the noble Baroness is looking for.

Lord Christopher: My Lords-

Noble Lords: This side!

Lord Christopher: I am not giving away after the 19th minute. I have tried four times.

Following the question asked by the noble Lord, Lord Mawhinney, will the Government produce proposals to deal with the situation that is bound to arise where the number of unemployed far outstrips the number of jobs available, which is particularly the case in the north? Will the Minister confirm that the Government have carefully considered ILO Convention No. 29, which Governments of this country have supported for 80 years? Is what the Government doing in accordance with that?

Lord Freud: My Lords, what we are announcing today is a structure that will encourage people to take the jobs that there are. A snapshot figure of 450,000 vacancies in Jobcentre Plus does not show the whole picture. There were 1 million vacancies in jobcentres in the past three months. In devising this strategy we will have looked at all conventions to make sure that we comply with them.

Lord Christopher: What about the second question?

Public Disorder at NUS Rally


2.53 pm

The Minister of State, Home Office (Baroness Neville-Jones): My Lords, I beg leave to repeat a Statement made earlier in the other place by my right honourable friend the Minister of State for Policing and Criminal Justice. The Statement is as follows:

"With permission, Mr Speaker, I would like to make a Statement on yesterday's public disorder at the National Union of Students rally.

The House will be aware that yesterday, following a peaceful demonstration organised by the National Union of Students, a violent faction directed a series of criminal acts against the office complex on Millbank, which houses a number of organisations and businesses.

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This Government have been clear that we are committed to supporting peaceful protest. Indeed, we included the restoration of the right to peaceful protest in our coalition agreement. However, as the Prime Minister said this morning, we are equally clear that when people are bent on violence and on destruction of property, that is completely unacceptable.

The operational response to the violence is quite rightly a matter for the Metropolitan Police, but I want to give the House an early indication of what happened yesterday, the action taken by the police and the follow-up action that will now be necessary. This information was provided at 9 this morning by the Metropolitan Police Service.

The NUS had predicted that yesterday's protest would attract around 5,000 demonstrators. This estimate was then revised upwards to 15,000. The police had planned to deploy around 225 officers to the protest. As the situation developed during the day, an additional 225 officers were deployed.

In the initial stages, the march passed the Palace of Westminster in an orderly manner. However, this meant that vehicle access to the Palace was not possible for around two and a half hours.

At about 1.10 pm, the front of the march reached the rally point at Millbank. At the same time, a group of protestors ran towards the Millbank office complex, which houses the Conservative campaign headquarters. Protesters from the main march then seemed to be encouraged by a number of individuals to storm the building and throw missiles. Windows were broken and significant damage to the property was caused. Some protestors also managed to gain entry to the building and some got on to the roof.

At its height, it is estimated that about 2,000 people were around Millbank, though many appeared not to be directly involved in violence. It is now clear that a small hard core within this group were intent on violence. Additional officers were then deployed in public order protective equipment. The Department for Business, Innovation and Skills was also attacked by a small number of protesters.

At about 3 pm, the police were informed that members of staff within the Millbank complex were concerned for their safety. They advised them to stay in the building. Officers were deployed to make contact with the staff and secure their safety. This took some time to achieve. By 4 pm, police officers had located the staff members and, over time, arrangements were put in place to escort them from the building.

The police then undertook a search of the office complex and made 47 arrests for criminal damage and aggravated trespass. The British Transport Police also made three arrests. Around 250 individuals were also searched, photographed and then released pending further investigation. Forty-one police officers received injuries. A small number were taken to hospital for treatment and were subsequently released.

The police are committed to bringing the criminals who carried out this violence in front of a court. The whole House will join me in condemning the minority who carried out these violent and criminal acts. There is no place for such behaviour in Britain's democracy. I

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would also like to thank the police officers who were deployed to the scene and who helped to protect innocent bystanders. They acted with great courage, particularly those who were holding the line until reinforcements arrived.

Yesterday, during the violence, the Home Secretary was in contact with the Metropolitan Police Commissioner, Sir Paul Stephenson. The Home Secretary also spoke to the Mayor of London and I spoke to Kit Malthouse, the chair of the Metropolitan Police Authority, which has responsibility for the governance of policing in London. I would like to praise Sir Paul for his swift and candid response to yesterday's events.

I spoke to Sir Paul this morning. He confirmed to me that the Metropolitan Police will also be undertaking an immediate and thorough review of their operational response to the incident. This will include an examination of why numbers and violence on this scale were not anticipated.

The police have to strike a balance between dealing promptly and robustly with violent and unlawful activity on the one hand and allowing the right to protest on the other. Clearly, in this case the balance was wrong, but these are difficult decisions and they are not taken lightly.

Let me finish by saying this. Yesterday did not go according to plan and the police will learn the lessons, but the blame and responsibility for yesterday's appalling scenes of violence lie squarely and solely with those who carried them out. I commend this Statement to the House".

That concludes the Statement. In the course of questions afterwards, my right honourable friend the Minister for Policing and Criminal Justice corrected himself. The Home Secretary did not in fact speak to the head of the Metropolitan Police yesterday. However, my right honourable friend did.

2.59 pm

Lord Hunt of Kings Heath: My Lords, I am grateful to the noble Baroness for repeating the Statement and for the further clarification that she has just given regarding the Home Secretary.

I start by agreeing with the Minister's right honourable friend, the Police Minister. The right to peaceful protest is a fundamental part of our democracy, supported on all sides of this House. Tens of thousands of students and lecturers came to London from across the country yesterday to exercise that right and to make their voices heard. However, the Police Minister is right to say, as the Prime Minister said last night, that the vandalism and violence that we saw yesterday were completely unacceptable. They were perpetrated by a small minority of thugs who hijacked what was planned to be a legitimate and peaceful demonstration and in so doing denied tens of thousands of students the right to have their voices properly heard.

The Metropolitan Police have told us that the National Union of Students worked closely and co-operatively with them before and during yesterday's events, as it has done in the past. The president of the NUS rightly said yesterday that the actions of a small minority were despicable and designed to hijack a peaceful

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protest. We on this side of the House are clear that there is no excuse whatever for such criminal behaviour and that those responsible must be brought to justice. We note that 50 arrests have been made. It is the job of the police not only to tackle crime and protect the safety of all our communities but also to keep public order as they ensure that the law-abiding majority can exercise their democratic right to protest and make their voices heard. The police ensure that thousands of major events and demonstrations pass off peacefully each year, often in difficult and challenging circumstances. I am sure that all noble Lords will want to join me in commending the hundreds of individual officers involved in yesterday's events, particularly the small number outside 30 Millbank and Millbank Tower early yesterday afternoon, for their bravery and dedication.

When things go wrong, it is vital that we ask questions, find out what happened and learn lessons for the future, so we welcome the urgent investigation that was ordered later yesterday afternoon by the commissioner of the Metropolitan Police and his straightforward and responsible admission that these events were "an embarrassment for London" and that there were lessons to be learnt. The Metropolitan Police have acknowledged that there was an operational failure and it seems sensible and appropriate in this instance that the investigation be conducted by the police themselves quickly and reported to the independent police authority.

I am sure that this investigation will look at a number of operational policing issues, including: whether sufficient officers were on duty to police what was expected to be a peaceful demonstration; why, when estimates of the size of the demonstration were revised up from 5,000 people to 15,000 and then 25,000, the Metropolitan Police made the judgment that this would be a peaceful demonstration; and whether there was any intelligence to suggest that violent actions were pre-planned. We also need to know whether sufficient back-up was available, how quickly it was able to be deployed and how operational decisions were made about which buildings and public spaces to protect.

However, wider questions were raised by yesterday's events, which go beyond the direct operational responsibilities of the commissioner and the Metropolitan Police and which are rightly also matters for the Home Secretary and the Government. Given the failure of intelligence in this case, will the Home Secretary assess whether the gathering of intelligence by the police and security services was sufficient and sufficiently well co-ordinated? Will she discuss the procedures for assessing risk and intelligence in advance of protests of this kind to ensure that the full risks are understood in advance? Given that yesterday and on previous occasions mobile phones and social networking have been used during demonstrations to co-ordinate actions and build momentum at short notice, what work are she, the Home Secretary and her ministerial colleagues doing to support the police and others in responding to this new challenge and what wider public order issues does this raise?

Given that this was a demonstration against a controversial aspect of government policy and that police officers were deployed outside the party

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headquarters of the Conservatives and the Liberal Democrats, did the Home Secretary or her advisers have any advance discussions of possible risks with the Metropolitan Police and lead party officials? At what time was the Police Minister alerted to the risk of elements in the demonstration becoming violent? What plans does the Home Secretary have to update the House following the conclusion of the Metropolitan Police investigation and the wider investigations that are now taking place?

Yesterday's events were at root the fault of no one but a small minority of violent demonstrators, whom we all roundly condemn. They are a timely reminder of how all of us are reliant on the police to maintain public order and ensure legitimate and peaceful protest. Is the Minister confident that the police will have the resources that they need in the coming years to deal with threats to our national security, to tackle organised crime, to ensure a safe and successful Olympic and Paralympic Games, to continue to provide visible neighbourhood policing in all our communities and to ensure public order at major events?

3.06 pm

Baroness Neville-Jones: My Lords, I am extremely grateful to the noble Lord for his endorsement. I think that it is the shared sentiment of the House that we do not accept violence as an accompaniment to the right to demonstrate. He was correct to commend the officers who were involved in dealing with the violence in Millbank Tower. Of course it is right that the police will want to learn lessons; the head of the Metropolitan Police has made that clear and has himself said that there was an operational failure. I have no doubt that it betokens a serious and detailed investigation that he will want to take place and I am confident that we can expect that. Of course, he will be reporting to the Metropolitan Police Authority.

As for the questions that the noble Lord put to me, in the first instance it is clearly for the police to decide how it was that a failure of intelligence arose. They were clearly not aware of the faction that appears to have come to the scene. It will be for them to assess why that was the case. There is no reason to suppose that it was in any way a result of a failure of resources. If the head of the Metropolitan Police decides to come to talk to the Home Secretary about some of his findings, I have no doubt that my right honourable friend will wish to listen to him and see where, if anywhere, the Home Office can offer help. However, in the first instance, it is clearly for the Metropolitan Police to make these judgments.

On the noble Lord's other points, I do not know whether there was advance discussion about Millbank Tower. It is clear from the dispositions of the police that they were aware of some of the sensitive buildings along the route. The Police Minister was certainly in touch with the Metropolitan Police during the demonstration, although I cannot give the noble Lord a precise time. As for the resources available, this is not a resource question; it is very clear that that was not the issue yesterday. I am confident that the measures that the Government have taken in relation to policing will not in any way impede an adequate response to all

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the various points that he mentioned in his list of issues, which undoubtedly we will need to take care of in future years.

3.09 pm

Baroness Hamwee: My Lords, there will be criticism no doubt that the policing was too light on this occasion and there was criticism that the policing of the G20 demonstrations was too heavy. Does the Minister agree that it is important that the pendulum does not keep swinging and that we seek the right level of policing for such demonstrations?

Baroness Neville-Jones: My noble friend puts the point, which I am sure we all appreciate, that these decisions are difficult. Getting the balance right between protecting the legitimate right to peaceful protest and safeguarding the public against illegitimate activity-and certainly violence-is precisely the issue that the police face. She is also right to say that in the past the police have been criticised for being too heavy-handed, whereas this time there was clearly not quite enough resource immediately available. However, once the police had learnt the nature of the situation, they were pretty fast in bringing the right sort of people in protective gear to the scene. I am sure that this is the aspect that the head of the Metropolitan Police will be looking at with great care.

Lord Bilimoria: My Lords, yesterday I was rushing to get to the House for our weekly Cross-Bench Peers meeting at 2 pm, but I was stuck on the Embankment for an hour. I eventually made it to just below Big Ben, where a policeman kindly let me through after I showed my pass and I drove, very slowly and carefully, through the mass of protesters. In front of the House of Commons, I was then surrounded by demonstrators with placards, who started to get violent and then lay down in front of my car and refused to let me move. The police standing around immediately came to my rescue. Four of them removed the demonstrators and I was able to proceed. When I made it here into the House the doorkeeper, when he heard my story, said, "My Lord, either you are the bravest Peer in this House or out of your mind to drive through that".

Only afterwards did I learn of the violence that had taken place, but when I was in that car I did not feel scared. I just thought to myself, "You're not doing any favours to your cause. There is no place for violence". There is every place for peaceful demonstration and I have every sympathy for the students who were demonstrating peacefully. I want to place on record my thanks-I request the Minister to convey them-to the police who saved me yesterday.

Baroness Neville-Jones: My Lords, I am sure that the police will be extremely grateful for what the noble Lord has just quite rightly said. I am sure that one of the points that the head of the Metropolitan Police will be looking at is the question of access to the House, which was not available to vehicles for rather more than two hours. I am sure that he will want to look at the whole question of how you combine the right to peaceful protest with continuing to enable Members of the House and, indeed, members of the

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public to gain access to the Palace of Westminster during protests. Perhaps I might say that the president of the NUS, to do him credit, has written to the head of the Metropolitan Police saying in formal terms that he is willing to co-operate with the police in their investigation, which shows a good sign of responsibility on the part of the NUS and its president.

Lord Dubs: My Lords, I join in praising the police for their efforts yesterday and in condemning those demonstrators who resorted to violence, thereby weakening their case. I am pleased that the Government have committed themselves to the right of peaceful protest, as we all do. However, I have one difficulty with what the Minister said: that it was not a matter of resources. If the police are using what intelligence they have to assess the likely amount of trouble that may be associated with a demo, the pressure on the police will be to have police officers in reserve and sitting in their vans in case trouble should develop. The difficulty for the police is that keeping those officers there is pretty expensive in overtime. I should like an assurance that the pressures on police finances, through the Government's decisions, will not be allowed to affect the right and the ability of the police to have officers in reserve, should they seek to do so.

Baroness Neville-Jones: My Lords, I should perhaps have been more specific when I commented that it was not a matter of resources. It was not a matter of the availability of resources. This was not a case where the police were constrained from having the necessary resources available. I think that it was an operational decision that they were not necessary but, as regards the future, that is obviously going to be very important. I am sure that the police will wish to make sure that in the resources available to them are the resources necessary for policing this kind of demonstration.

Lord Brooke of Sutton Mandeville: My Lords, I first declare an interest as somebody who, perhaps surprisingly, was once elected deputy president of the National Union of Students. The Official Opposition spokesman raised the fact that the estimates of those who were going to attend rose steadily in the 48 hours before the protest. Do the police have a figure for those whom they believe to have been involved at the end of the day?

Baroness Neville-Jones: My Lords, I think I am right in saying that the figure is 40,000 involved. Certainly, there was a relatively late surge and the figures rose. I am sure that is precisely the point which the Metropolitan Police Commissioner, when he is investigating how they did their planning, will want to look at-including whether they had enough regard to possible, last-minute additional numbers joining the demonstration. Until we have had the results of that investigation, it is quite hard to go any further in examining the whys and wherefores or the lessons that we need to draw.

Lord Clinton-Davis: The Minister was quite right to underline the fact that most students conducted themselves in a seemly manner and that it was a minority who

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misbehaved, but will she also direct her attention to the way that the press-some of the press, not all of them-have depicted the view that a large section of the protesters encouraged riotous behaviour? It was unseemly of that section of the press to so behave.

Baroness Neville-Jones: Well, my Lords, we have a free press, do we not, and we may not always agree with either what they say or do. This is not quite so germane to the noble Lord's question, but it turns out that the correction I made was erroneous. The Home Secretary did not speak to the mayor; I had said it was the Metropolitan Police Commissioner, so I apologise to the House. However, as is clear from the Statement, there was contact between the Government and the police. There has also, obviously, been extensive contact today as a basis for giving accurate information to the House.

Lord Brett: My Lords, yesterday when watching television I had a sense of déjà vu watching the disgraceful events in Millbank Tower. The déjà vu was: 1996 in Seattle with the World Trade Organisation, where I was one of the people inadvertently suffering from pepper gas and tear gas, because the police were seeking to protect the delegates but had the Seattle sound with a 30 mile an hour wind to put up with. The thing that was in common was watching people dressed entirely in black and wearing hard hats, smashing into Millbank Tower then encouraging young people to go in and themselves, noticeably, not necessarily going in but walking away. That is exactly what I saw when a Starbucks coffee house was burnt out in Seattle. The gentleman who threw the brazier in-he had lit a whole pile of rubbish-then walked away, taking off his black shirt and putting it underneath his other T-shirt.

It is therefore not necessarily just a question of students, because I suspect that some of the people have nothing to do with being students. I trust that the investigation will therefore look at that. More particularly, there was intelligence about Millbank Tower, where I used to work. It is a large building with lots of staff who must have been very terrified when that happened. If there was such intelligence, was the management of the building informed of the likelihood of such dangers?

Baroness Neville-Jones: The noble Lord makes some good observations about what went on. The Statement was rather careful in just referring to a "faction", because at this stage we simply do not know exactly who was involved. He is quite right, and anyone who viewed television saw what he saw, that there was obviously preparation; you do not come along with a mask without the intention of doing something, or indeed with, I believe, a hammer. Clearly there was premeditation.

The noble Lord is also right to say that this must have been pretty frightening for those who were in the building. I would say that one of the first cares of the police when they arrived in that building was to secure the safety of those in it and, thereafter, to begin to eject the intruders.

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I cannot answer the question about the information to the management. I would hope that because of the route, and given that the police were there, the management of the building had some forewarning.

Lord Marlesford: My Lords, I am sure we all agree that peaceful protest is a crucial element of democracy and that the right place to protest against Parliament is Parliament Square. Unfortunately, Parliament Square is barely available now to protesters. Because of the misuse of the whole green area over a long period, it has all had to be closed off, and now the pavement in front of that area is occupied by a permanent camp. Will my noble friend recognise that Parliament Square should be kept as an open space, available for protest, and that the way of achieving that is to say that there should be no permanent camps in the square? I suggest that at some stage in future-I do not know whether it needs legislation-all impedimenta is removed between midnight and 6 am. People can come and protest any time they like but, between midnight and 6 am, anything that has been left behind is removed by appropriate vehicles. That at least will mean that Parliament Square is then available for protest, which is such an important aspect of our liberty.

Baroness Neville-Jones: The noble Lord is right to say that we need to have Parliament Square available for protest. The House had a big discussion of this issue a few days ago and I repeat what I said then: we entirely agree that that is the case. At the moment the grass is being reseeded, which is why the square is not available. The Government intend to bring forward a first Session Bill not so much directed at in any way limiting or trying to curtail the right to organise a protest but to deal with those things that get in the way of and frustrate the right to peaceful protest, which will include encampments.

Lord Elystan-Morgan: My Lords, I commend to the Minister the wisdom of the late James Callaghan, whom I had the honour of serving in the Home Office some 40 years ago when there were some very robust protests, as she will remember. He used to say, "It is far better to have a surplus of officers on the scene rather than the other way round. The more officers you have, the less likely will be the need to resort to violence".

Baroness Neville-Jones: I have no doubt that the head of the Metropolitan Police will heed those words. It is obviously not just the number of policemen that is important; it is how they manage the protest as well. It is clear, though, that one has less chance of being able to police it satisfactorily if the numbers are not adequate.

Lord Brooke of Alverthorpe: My Lords, the demonstrations yesterday were about tuition fees. Today we have the announcement about welfare reform. Next year we will start to see the consequences of the housing benefit changes being introduced and there will be a growing mood, as I am sure most people will agree, of dissatisfaction in many quarters. Do the Government have appropriate resources available, following on from my noble friend Lord Hunt's question, for the appropriate intelligence research to be undertaken?

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As a side issue, I draw attention to what happened in Newcastle when there was the debacle with Mr Moat. We saw that a substantial website was quickly established, with thousands of people signing up to it and supporting him, quite contrary to the view expressed on behalf of the public by the Prime Minister. We then saw a funeral that literally hundreds of people attended, contrary to what most people would have thought would happen. There is a distinct possibility, with the technology that is now available to us-we see this when surprise parties are called by teenagers and thousands of people descend on their home for a party-that in 2011 we will see a different mood entirely, with a different technology available that could lead to demonstrations of a nature that we have not previously experienced. Are we geared up for this when we face substantial cuts in the Home Office?

Baroness Neville-Jones: My Lords, as I said previously, I am confident that this is not a question of whether the numbers and resources are available for the acquisition of intelligence. The noble Lord makes a good point when he says that modern technology-mobile telephony, combined with the use of the internet-can produce situations that can change rapidly, as in the immediate run-up to a demonstration of this kind. That is clearly something that the police will need to take into account in how they use their intelligence resources with the help of other agencies, and how they plan for demonstrations. I am confident that the police have both the resources and the capability to do this.

Baroness Sharp of Guildford: My Lords, were any police resources outside those of the Metropolitan Police used to help to police this demonstration?

Baroness Neville-Jones: I am afraid I do not know the answer to that question. I will have to write to the noble Baroness. Clearly, students came from some distance so it would be logical for there to have been contact, but I do not specifically know.



3.25 pm

Moved By Lord Hannay of Chiswick

Lord Hannay of Chiswick: My Lords, the timing of this debate on the case for Britain to have an active and well resourced diplomacy is fortunate, not just fortuitous. If we had been holding this debate in advance of the comprehensive spending review, it could easily have been dismissed as a piece of special pleading on behalf of one of many government departments about to face deep cuts-all the more so since I have to declare an interest as a former member of the Diplomatic Service. But now that the comprehensive spending review is out on the table, the opportunity is

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there to focus not on the overall quantum but on how best to put it to good and effective use in the national interest-how to ensure that doing more with less is not just one of those meaningless and infuriating mantras but is a reality.

It was well over a century ago that Lord Salisbury gave his often repeated prescription for British foreign policy-that it should be like floating down a river, fending off the bank from time to time. In fact, this classical description of a passive, purely reactive foreign policy was out of date even when it was coined. As the country found at the time of the Boer War, it could well lead to splendid, or rather not so splendid, isolation; and that discovery led to a hasty scramble to acquire allies in the failed attempt to stabilise Europe, which culminated in two world wars. Out of date then, any such prescription is a great deal more out of date now.

The hard fact is that a country that is a global superpower, as Britain was then, needs an active diplomacy less than a middle-ranking power with worldwide interests, such as we are now. Everyone beats a path to the door of a superpower, which can take its time in responding because it is so indispensable. But a middle-ranking power has to work actively to further and protect its interests if they are not to go by default, and it needs to have strong alliances and networks in good working order for when they are needed. That is a lesson which was very clearly drawn in the recent national security strategy and in the defence and security review.

Such networks and allies do not simply drop effortlessly into our lap; nor can their policies be shaped to fit our as well as others' interests without ceaseless diplomatic work. Add to this the fact that multilateral diplomacy, which now makes up so much of the foreign policy mix, is a labour-intensive industry necessitating work not just where a particular organisation is headquartered but in the capitals of each of the members of that organisation, and you have a lot on your hands. It was considerations such as those which led the Callaghan Government, some 30 years ago in the midst of an earlier period of cuts and austerity, to reject the view of the Berrill report that Britain could no longer afford what was charmingly described as the luxury of a first-class diplomatic service. Those considerations are even more compelling today than they were then.

If we are successfully to do more with less then we will have to increase the coherence of the foreign policy instruments at our disposal and the way they are deployed. We will need to marry our hard power-now considerably diminished-to our soft power and ensure, as we have not always done in the recent past, that together they are up to the demands we are putting on them. We will need to break down the stovepipes in which policy is formulated at home and executed abroad-security, diplomacy, development, energy, climate change and so on. We must also ensure that the practitioners-the diplomats, the military and the development aid experts-understand each other's work much better and gain experience of each other's work and how to work together and not in competition with each other.

We will need, too, to make the best possible use of the new European External Action Service, which is gradually taking shape in Brussels and around the

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world. To treat it as, at best, a tiresome and duplicative nonsense and, at worst, a competitor would be to miss a golden opportunity. We surely need to be thinking imaginatively about what the European External Action Service can do collectively for us and for the rest of the EU and what we should therefore no longer be trying to do individually ourselves. We need to second good people to the EEAS and support its efforts to reduce turf fighting between the European institutions, to achieve greater policy coherence among the EU's external policies, to increase its own professionalism and to extend its outreach so that less time and effort are spent on cobbling together tortuous internal European compromises, and more time is spent on persuading third countries of the value of the EU's policies and on public diplomacy.

Let me turn to the issue of resources, without which all that I have said previously in general terms could just remain empty words. Here are a few suggestions. First, I hope that we will avoid falling into the false dichotomy of thinking that there is a choice to be made between bilateral and multilateral diplomacy. One does occasionally hear echoes of that sort of approach in ministerial statements and briefing. But this is surely not an either/or matter but, rather, one of both/and. The two forms of diplomacy are now inextricably linked and need to be mutually supporting if we are to further our interests successfully.

Secondly, on the exchange rate risk to British diplomacy's overseas expenditure-that is, most of it-I do not wish to delve too deeply into the background to the decision a few years ago to remove the existing policy of compensating losses as a result of exchange rate fluctuations. It reflects credit on neither the Treasury, which imposed it, nor the Foreign and Commonwealth Office, which accepted it. The result when sterling dropped sharply in 2008 was a double whammy for the Foreign and Commonwealth Office of external and internal cuts. Can the Minister tell the House that this will not happen again?

Thirdly, I hope the temptation to save by closing more diplomatic posts will be resisted. Multiple accreditation-having a mission in another country that serves the country in which you have closed down on a very random basis, visiting once or twice a year-is not a viable alternative to a presence, however small, on the spot. I still remember the helplessness I felt as ambassador at the UN when we had no post in Kigali when the Rwandan genocide broke, no post in Kabul in the years after the Soviet withdrawal and no post in Mogadishu through the UN's troubled experience there. If very small posts have to operate somewhat differently from larger ones, and we have to accept that we can get fewer services from them, I would say "So be it". We will just have to get used to that, but let us avoid ending up with a diplomatic cloak full of holes. I hope the Minister can say something on that aspect too.

Fourthly, my view is that the decision to shift the funding of the BBC World Service from the Foreign Office budget to that of the BBC should be a plus, at least in presentational terms. I have to admit that I never managed to persuade a single foreign interlocutor of the BBC World Service's total editorial independence

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every time I had to admit that it was in fact being financed from the Foreign Office budget. That should be easier to achieve now. But how are we to be sure, under the new arrangements, that the World Service is not being bled to meet the BBC's domestic demands? How, too, is the World Service's coverage and editorial autonomy to be protected from interference by the BBC's management, as it was from interference by the Foreign and Commonwealth Office? I wonder whether the Minister could give us a bit more detail on this; not very much has been said so far about this really important aspect of our foreign policy and our soft power. Could he also say something about that other crucial part of Britain's projection of soft power, the British Council?

Of course, the resources that really matter in diplomacy are the Diplomatic Service's human resources. I have the impression that in recent years those resources and their morale have been under considerable stress. Recent losses through early retirement, while perhaps unavoidable, have resulted in the departure of many top-class diplomats whom Britain could hardly afford to do without. I am, however, struck when travelling abroad by how well the morale and quality of our diplomats is holding up. But it is surely time that a bit more effort was put into reducing the stresses on them. We often speak, quite rightly, in this House about our admiration for Britain's Armed Forces; not so often about our admiration for our diplomats, who also run very considerable risks. We should not forget what the Duke of Wellington said when asked, towards the end of his life, what he would have done differently. He replied, "I should have given more praise".

I hope I have managed, in opening this debate, to set out a compelling case for Britain having an active and well resourced diplomacy. If we are successfully to meet the challenges of the increasingly multi-polar world in which we now live, that is what we will need. If we are to work effectively for an increasingly rules-based world, which I believe it is in our interests to achieve, that, too, is what we will need.

I conclude with a perhaps slightly eccentric plea for less frequent use of the phrase, "Britain punches above its weight". I admit that I may have been partly responsible for its entry into our diplomatic lexicon but it tends to play to a strain of post-imperial nostalgia which I believe we must now leave behind us. Like courage, it is surely one of those characteristics which are better noted by others and not bestowed on ourselves. I beg to move.

3.37 pm

Lord Bates: My Lords, it is a privilege to speak in this debate. I congratulate the noble Lord, Lord Hannay, on securing it and on the way in which he has introduced it. He has certainly made the case for an active and well resourced diplomacy.

Had the great minds who organise the sequence of speakers known something of the content of the contributions, mine would probably have come a little further down the list as it is more esoteric in nature and focuses particularly on an instrument called the Olympic Truce. The noble Lord, Lord Hannay, will be familiar with the subject as we had a debate on it in

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this House on 11 October. I want to place it in the context of public diplomacy and the comments about soft power.

In a speech in the Foreign Office on 1 July setting out the new direction of foreign policy under the coalition Government, my right honourable friend the Foreign Secretary said that the coalition Government's goal was to,

That is absolutely right. Influence matters in the modern world, as the ability for nation states to act alone is severely constrained in the modern era-and many of us would say rightly so. Modern diplomacy, like politics, is now the art of persuasion, and as in any exercise in persuasion, reputation is vital, hence the unarguable importance to the Foreign and Commonwealth Office and to British diplomacy of the BBC World Service, the British Council, the Chevening and Marshall scholarships and Wilton Park. They set the mood music around which the negotiations, discussions and diplomacy are conducted.

There has been some discussion about whether it was right to separate DfID from the Foreign and Commonwealth Office, as the valued work that DfID does around the world is phenomenal. I am immensely proud to be a member of the coalition Government who will increase overseas aid to the 0.7 per cent figure to which we have aspired for so long. We should be very proud of that.

The Olympic Games are referred to on the Foreign and Commonwealth Office website under the heading "Public diplomacy". It states that it is:

"A once in a generation opportunity",

and that:

"As 2012 approaches, the London Olympic Games will focus the world's attention on Britain. The Games offer unique stimulus to invite people from around the globe to re-examine their views about the UK.

The FCO and our Public Diplomacy Partners view this as a remarkable opportunity to demonstrate the open, connected, dynamic and creative country that is Britain today".

Nobody would argue with that. It is absolutely right that the eyes of the world are on London. The success that the Olympic Games are having is amazing. The stadium will be finished a year in advance. The velodrome, one of the largest facilities, will be opened in a few months. When the Chinese were doing that sort of thing for the Beijing Games, we all stood in awe; when the British do it, somehow we do not take the same pride, but it is a tremendous tribute to the reputations of the people who have worked on the Games and the leadership of the noble Lord, Lord Coe.

The Olympic Truce is a convention stretching from the original Games which says that, during the period of the Games themselves, the member states will,

That truce is moved in the United Nations General Assembly by the host nation, so it will be moved by the Government at the 65th session of the United Nations, next year. Her Majesty's Government, like any previous Government in this country, have no intention whatsoever to take any initiative for peace or reconciliation during the Games at all. For not doing so, Britain will not be

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regarded as a pariah state because none of the other 191 countries that signs up to the Olympic Truce at the UN General Assembly, saying that they will pursue initiatives for peace and reconciliation during the Games, will do anything either.

I am trying to make the case for this being a great opportunity for British diplomacy. It can show us at our best. It is a once-in-a-generation opportunity to do something worth while. The United Nations truce will be the only element of the Olympic Games that falls directly within the bailiwick of the Foreign and Commonwealth Office. It is therefore astounding that there is no mention of it on the website. Yesterday, the Foreign and Commonwealth Select Committee in the other place had a hearing on public diplomacy at the London 2012 Games. During that, Jeremy Browne, the Minister, gave evidence for an hour but did not mention the truce once. In advance of that meeting, there was a 50-point statement as to what the Foreign Office would do on public diplomacy surrounding the Olympic Games, but it made no mention of the Olympic Truce.

I urge my noble friend to consider the Olympic Truce and give it its right place so that it can be an important element of how Britain is seen around the world, and in promoting good around the world.

3.43 pm

Lord Anderson of Swansea: My Lords, I have just excised from my speech the phrase "punching above our weight".

Britain's Diplomatic Service is a centre of excellence admired worldwide and the noble Lord, Lord Hannay, is an outstanding example of the service at its best. I have had close contact with the FCO since 1960, when I entered as a third secretary. Traditionally, the service has been able to take a major share of the available pool of talent and, from my experience even over recent years, I am convinced that it still attracts high-quality personnel. The question, therefore, is whether that will continue as the CSR cuts bite. What will be the effects on recruitment and morale?

There are some welcome features in the CSR, such as the new foreign currency mechanism that will increase stability, but the settlement overall will have a disproportionate and negative effect on the service, with 25 per cent in cuts over four years. By 2014, the FCO budget will be £1.3 billion, which is only just above the UK's contribution to the European External Action Service. By then, DfID will have £11.56 billion-nine times as much as the FCO. DfID officials will not easily substitute for FCO officials.

Of course, traditional diplomacy has its faults. The "déformation professionelle" results in excessive caution and a yearning for the quiet life, but officials are immensely competent and loyal to the Government of the day, even when they feel under fire from that Government. For example, it was claimed that the noble Baroness, Lady Thatcher, in the 1980s said that the Ministry of Agriculture represented farmers and the FCO represented foreigners. Echoes of this arise in the talk of a cull of faceless bureaucrats in London. Is it right that over four years there will be a reduction of 10 per cent in the number of diplomats overseas? How

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many compulsory redundancies are planned for? Given the number of redundancy payments, how long will it be before the savings actually begin? Will the payment of school fees for diplomats' children continue after the redundancy of their parents?

Even within the reduced total, the traditional diplomatic role will be reduced. That is, a larger share of the reduced budget will reflect changes in our society and mobility worldwide, such as the increase in consular and visa work. Will the Minister give an assurance that personnel, building security and counterterrorism will not suffer, and that language training will not be reduced? Our hard language ability is much admired and, of course, costly. I am sceptical about the claims of a revolution based on the new emphasis on trade promotion. For many years, the path to promotion has lain through expertise in trade. Trade envoys-yes, but ambassadors from the business community-no. Apart from the reduction in salary, the job is very different.

How do we mitigate the effects? I have time to give only some headlines. On the selling of the FCO estate, much has already been done, for instance, in the Lisbon and Vienna residencies. Is there a threat even to the Paris residence? As the noble Lord, Lord Jay, will evidence, it is much used for trade promotion. More locally engaged staff can have only a limited effect because there is clearly a ceiling for their promotion. If there are more jobs in London and development of the hub concept, we may lose the value of personal contacts cultivated over time and the facilitation of networks and alliances. As for co-location and overlapping subject areas with DfID, there is some scope in the fields of governance and conflict prevention.

On greater co-operation with allies, now that there is new Franco-British co-operation in defence, why not in foreign affairs? There are potential benefits in premises and personnel, particularly in west Africa. Co-operation with the European External Action Service includes the co-location of embassies and delegations and long-term personnel secondment. It is an interesting paradox that, by these cuts, a Conservative-led Government will lead to the posts in the European External Action Service, with its budget of £8 billion, having greater weight than our own diplomatic personnel.

Clearly, the role of diplomacy is misunderstood and undervalued. If we want a still substantial global role, we will have to pay for it. Development aid cannot be effective if there are problems of governance, as we have seen in Somalia. It is odd that a Conservative-led coalition is reducing our strategic strengths and promoting a "littler England". Is this our "east of Suez moment" in foreign affairs?

Finally, the Independent of 8 July stated that after the FCO leadership conference, which was attended by more than 200 ambassadors and high commissioners, the Prime Minister addressed business leaders at Downing Street. The newspaper said:

"Mr Cameron laughed: 'We made them all travel economy class, wherever they came from, I'm pleased to say'. The assembled audience laughed".

Is the aim, or at least the effect, of these cuts to reduce a first-class service to an economy-class service?

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3.50 pm

Baroness Falkner of Margravine: My Lords, I, too, thank the noble Lord, Lord Hannay of Chiswick, for initiating this debate. It is now nearly 50 years since Dean Acheson said that Britain had lost an empire but had not yet found a role. In many ways, this is still true today. We continue to have tremendous reach. Senior membership of the United Nations Security Council, the EU, NATO, the Commonwealth and a host of other multilateral institutions are all admirable roles. However, alongside our desire to sit at the top table, there seems to be a lack of vision about how this middle-sized country on the edge of Europe can project its capabilities in a fashion commensurate with its ambitions.

The record of the recent past is poor in vision. Mr Blair's Chicago speech of 1998 on liberal interventionism seems as anachronistic as Britain's rhetoric at the time of Suez. Through our use of force, we have lurched from the positive power projection of the 1990s to international criticism and domestic cleavage. I say to the noble Lord, Lord Anderson, that if we have a "little England", it is partly due to his Government's extravagances rather than to anything that was planned or preordained. This Government have moved with admirable speed to come to grips with what a national security strategy should look like. However, a security strategy inevitably does not cover the central question of how the Diplomatic Service should serve our national interest.

Despite the Foreign Secretary's excellent speeches in recent months, we are not yet clear about the shape and form of our Diplomatic Service in this period of austerity. While financial savings can and must be found, they will be least damaging if we have a clearer sense of our priorities. Building Britain's prosperity and safeguarding her security are not always compatible or obtainable in equal measure. The two require very different skill sets and capabilities in policy and diplomacy. The balance between them becomes ever more important in a democracy in which every citizen, through the internet and news media, becomes a freestanding and engaged foreign policy expert. On the high street, the exigencies of national interest are not always understood or supported. A recent YouGov poll, in advance of the Prime Minister's visit to China, showed that nearly 64 per cent of people were less concerned about our security, trade and economic interests there than in the plight of Tibet.

The national security strategy highlights how we find ourselves in a world that is more uncertain than it has ever been. Globalisation is in a "long crisis", according to a recent Chatham House paper. This extended period of volatility, where demographic, economic and security challenges extend across the globe and where nationalism and interdependence are rising together, opens up a fresh set of challenges. Our values and outward-looking posture mean that we are better suited than most to confront these new trends, yet the comprehensive spending review has left our foreign policy capabilities rather weaker. In these circumstances, perhaps we need to define our power and those capabilities rather more narrowly than our ambitions would suggest.

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Alongside the national security strategy, we need a more pragmatic view of our foreign policy priorities. Principal among these must be a realistic assessment of our global reach. I suggest that it should be somewhat more limited than the fully adaptive posture that the strategic defence and security review suggests. In these austere yet unpredictable times, we may well have to make a case for defining our international mission more accurately as managing global risks on behalf of British citizens. In practical terms, this should result in our lending more support to the EU's External Action Service than we have given to date to allow it to do more representational work for us while our own independent presence is reduced.

While there may be some specific differences in foreign policy among our EU partners, overall our values and priorities are surely more aligned than divergent, and we should consider how we might use the External Action Service as an opportunity rather than view it as an inconvenience. The vision of our strategic reach must nevertheless not be constrained merely to our commercial or national security imperatives. DfID's budget and objectives should rightly be more closely aligned with our Foreign and Commonwealth Office-led interests, and indeed with the MoD's capabilities, particularly in conflict-afflicted states, and I welcome the direction of travel in that regard.

The projection of our soft power is the reason why we are still well regarded in the world. Our language is spoken across the Commonwealth and beyond, our universities are worldwide centres of excellence, and the BBC and the British Council are almost as important for projecting influence as our military is for projecting power. Although the CSR has been "creative" in spreading the costs of these institutions across other bodies, they have all undoubtedly been rendered more vulnerable with the cuts. The danger is that years of success will be lost over a short period, with a cost to the nation over the longer term.

Therefore, we now find ourselves with these substantial reductions in budgets, which necessarily will have been arrived at without forethought. What is now needed is a hard-headed judgment of what we can achieve and, where these goals are more limited than those we have aspired to in the past, we need to set out and prepare for them in a more considered and coherent manner. That should be the basis of an active diplomacy that has risen to the new challenges, and I hope the Minister will be able to give us an indication of how he intends to achieve that.

3.56 pm

Baroness Afshar: My Lords, I thank my noble friend Lord Hannay for placing this debate on the agenda. I have to declare an interest because I shall be speaking about Iran. I was born and raised in Iran and I worked there as a journalist. However, what I really remember from my past is the extraordinary influence that Britain had on Iranian politics during my childhood-so much so that I remember whenever anything happened to the soup, our cook would immediately say, "Poltiqueh inglissas". It took me a while to understand that she meant, "It's because of the politics of the English". It seemed to have an influence right across our lives.

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I suggest that the BBC in particular retains the kind of punch that it has had for a long time. In Iran at the moment, with many of our journalists languishing in prison, it is regarded as one of the most reliable sources of information there. I can tell your Lordships that the BBC has been listened to and watched by Iranians for ever. I remember, as a young student, giving an interview to the BBC and inadvertently admitting that I was helping behind the scenes of the local pantomime. I was suddenly hit by an avalanche of calls and letters from irate aunts and uncles telling me how I should not be mixing with thespians. They had all heard the programme, in which I had thought I was just having a chat in an interview.

I find that appearing on BBC television has exactly the same impact. Iranians watch it. The Iranian Vice-President is on record as admitting that he does not like BBC Persian Television, although he has watched it during a Cabinet meeting. Therefore, it seems to me that Britain is punching above its weight in the case of Iran. That is not surprising, particularly as BBC Persian Television is run by people who have been largely recruited in Iran, including many young journalists who have found the situation there impossible. Therefore, not only to avoid imprisonment but also to have a voice, they have come to work for the BBC, and I assure your Lordships that their voice is being heard loud and clear in Iran. It seems to me that, in response, the Iranians provide the BBC with an enormous amount of information.

Interactive connections exist with the BBC, and I understand that at some point eight videos per minute were sent to the BBC during times of crisis in Iran, when no one in Iran could broadcast them but the BBC could. It became a source of information for many news agencies around the world. That interactivity is feared by the Iranian Government but respected by Iranians, because they do not see the BBC as the voice of the British Government. Often, the BBC reports the unheard voices of Iranians, and many of us rely on the BBC reports because our e-mails are checked and we do not get phone calls that are not controlled. Therefore, it is crucial that the BBC retains its ability to broadcast to Iran. We know that the Government fear it by the number of jammings of BBC programmes that have occurred again and again.

Given this important impact, given that Britain needs all the friends it can possibly get in the Middle East in general and in Iran in particular, and given that the nuclear debate has been very counterproductive in its impact on the popular mind in Iran, the BBC-radio, and television-is the most effective informal channel not only to influence Iranians but to convey Iranian views abroad. It is therefore a matter of great regret that, as I understand it, the Foreign Office has taken a 10 per cent cut in its budget but the BBC World Service is about to take a 16 per cent cut. Does the Minister consider that there is any room for reconsideration?

4.02 pm

Lord Monks: My Lords, it is a pleasure to follow the noble Lord, Lord Hannay, in a debate on diplomatic questions because of his immense knowledge and experience of world diplomacy. I lay claim to some

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experience, if not expertise, in that field; I currently work in Brussels for the European TUC as general secretary. The UK diplomatic representation, inelegantly called UKRep, is generally admired as the classiest operation, the top team, around the town-even by the French.

I do not always agree with what UKRep does on behalf of Her Majesty's Government. It has blocked progress on some important social issues dear to my heart, such as insisting on maintaining the working time opt-out. Why is it that UK workers can be pressed to work what are on average the longest hours in the European Union? On posted migrant workers-the category of migrants who are brought with an employer to fulfil a contract-why do only the minimum rates need apply in the UK, not the rate for the job? They often undercut British workers, and then people are surprised when there is some anti-migrant feeling.

Why do successive UK Governments continue to oppose a social clause in the single market and downplay the need for the single market to have a social dimension? Without such a dimension, hostility is likely to grow against free trade and the single market. That will encourage the protectionism that we saw in last week's American elections.

These are questions on which I battle weekly with the UK representation. Ruefully, I have to subscribe to the chorus of admiration for the skilful way in which it plays its cards. It is a powerful agent for UK government policy, and diplomacy is truly an area of British excellence.

I am conscious that I am very privileged to join this House. I hope to bring some insights, especially into economic and employment policy and European affairs. Eighteen years, first as general secretary of the TUC-it is good to see a quintet at least of former members of the General Council of the TUC, including the trio in front of me-and another eight years after that as general secretary of the European TUC, have strengthened a deep commitment to trade unionism as a force for good in our society. I hope that the economic crisis that we have at the moment will be rather like the 1930s in one respect in that people in difficulties will turn again to the union movement in democracies and that it will take its full and proper place in the national life of the country, not just as the awkward squad but as a real force for constructive engagement, especially on promoting greater equality, skills, productivity and, critically, higher standards of performance and governance in many of our companies.

I was addressing a City audience not long ago and making the case for more long-termist perspectives from investors and entrepreneurs. One financial executive smirked and said, "I have some long-term investments; they were short-term investments, but they have gone wrong, and I can't sell them". Short-termism is a British problem. It is a major reason why so many of our private sector companies, not just Manchester United and Liverpool, are carrying so much debt, why our manufacturing sector has shrunk to worrying levels and why foreign companies are able to pick up household names at bargain prices.

I certainly do not knock foreign companies generally. Some are exemplary long-term players, and they show up the weaknesses in too many of our own firms, but

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we need more home-grown companies that can hold their own in the world and do not sell out at the first whiff of a big cheque for shareholders and top executives. How company boards run themselves, which interests are included on the board, whether shareholder value should be the sole goal of companies, how to organise takeovers, and, if necessary, block them, and what to do about the often excessive levels of boardroom pay that risk directors being regarded, in Richard Lambert's memorable phrase, as "aliens", and in my words as the Bourbons of our age, are all questions that are ripe for powerful scrutiny and new thinking. I am watching carefully the right honourable Vincent Cable, who has expressed himself strongly on these issues, to see whether he will maintain his interest and not get swamped by urgent, but not more important, questions.

Today is Armistice Day, and we remember all those who made and make the ultimate sacrifice for the country. The European Union was born out of the wreckage of the Second World War and has been a major part of ensuring that any repeat now seems a remote prospect. That is a huge achievement in a continent scarred by too many bloody battlefields and haunting cemeteries. Britain's place is in Europe, not just for reasons of the past, but for the future too, as new, major, formidable economies emerge to take a prominent place in the world. It is not just aircraft carriers that will need sharing in our corner of this world if European influence is to be sustained. Indeed, as the noble Lord, Lord Hannay, said, the European External Action Service, under the capable leadership of the distinguished former Leader of this House, the noble Baroness, Lady Ashton, is recognition that diplomatic efforts can usefully be shared in many parts of the world. I am sure that British diplomats will flourish on this particular European stage.

I finish by thanking noble Lords, the Clerks and, indeed, all the staff of the House for the friendly welcome that has been extended to me from all sides. I am very much looking forward to making my contribution to the work of the House.

4.09 pm

The Lord Bishop of London: It is a great privilege to follow the maiden speech of the noble Lord, Lord Monks, on which I congratulate him. I also congratulate him on his-in the American phrase-non-remunerated endorsement of UKRep and its excellence in Brussels. As he reminded us, he speaks with a lifetime's experience of industrial relations in this country and throughout Europe, not least in his service with ACAS, so he speaks about diplomacy as a practitioner. Offering the possibility of reflecting on the Stürm und Drang of professional life in the relative tranquillity of the British senate is one of the ways in which your Lordships' House plays a unique and valuable role in our constitution. The speech of the noble Lord, Lord Monks, was a notable contribution to this tradition and I know that the whole House hopes that his voice will be more frequently heard in the future.

I am grateful to the noble Lord, Lord Hannay, for introducing this debate and for doing so in a way that acknowledged the alliance between the traditional actors in diplomacy and others who represent a multitrack

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approach. The dissolution of the Soviet Union brought to a close the period in which a single international conflict dominated the international system. Instead, we have seen intra-state rather than inter-state conflicts, ethnic conflicts, secessions and struggles often, alas, fortified by religious rhetoric and symbols become the norm. As we speak, the turbulence and the suffering in Iraq continue, not least on the part of the ancient Christian community, which has suffered grievously in recent days.

During the Cold War, international relations were largely the preserve of the professionals, the diplomats and the politicians. I think that we should pay tribute to a number of pioneers in the US and Europe who saw the potential of applying approaches that were being developed in the setting of industrial relations. These have played an enormously important part in the development of a multitrack approach and in community mediation work through their application to conflict in general, including civil and international conflict.

At this point the question arises as to whether, in addition to being part of the problem, the faith communities may have a contribution to make in the field of conflict prevention. It is a question that has aroused some academic interest in the Anglo-American world ever since the publication, well before 9/11, of Professor Samuel Huntingdon's book The Clash of Civilizations and the Remaking of World Order. It is evident that many of the violent conflicts in the modern world are rooted in threats to identity. Religion in many parts of the world is crucial to social cohesion and is therefore likely to be co-opted in any struggle that centres on identity. Folk wisdom easily understands how the highest ideals are bent to the most malign purposes. Jonathan Swift, that Irish dean and the author of Gulliver's Travels, lamented:

"We have just enough religion to make us hate, but not enough to make us love one another".

However, are there positive resources within the traditions and institutions of the world's faith communities capable of making a contribution to conflict prevention and peacemaking? Is it possible that, as the title of an influential book from the Washington-based Center for Strategic and International Studies suggests, religion is a missing dimension of statecraft? It seems obvious now that US monitoring of Iranian politics ought always to have included the religious dimension, but a report from CSIS reveals:

"The one recorded attempt to do just that within the CIA, before the revolution, was vetoed on the grounds that it would amount to mere sociology, a term apparently used in intelligence circles to mean the time-wasting study of factors deemed politically irrelevant".

No one, so far as I am aware, is calling for the call-up of platoons of clerics and mullahs to shuttle between capitals like ersatz diplomats, but we must try to be practical.

Here I must declare an interest as the founder and current chairman of St Ethelburga's Centre for Reconciliation and Peace. St Ethelburga's is a little church that survived the great fire of 1666 and the blitz but not the effects of an IRA bomb in 1993. That bomb, from a conflict that has a religious dimension, made us determined, encouraged by the late Cardinal

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Hume, to rebuild the church as a centre for reconciliation and peace. Over the past two years, 20,000 people have participated in our programmes.

I make a plea that, as we enter the dangerous second decade of the 21st century, where even the editor of the Economist has written a book suggesting that God is back, we should look to develop our active and well resourced diplomacy by making deeper alliances with the new resources for conflict prevention that the faith communities, not only the Christian ones, have developed.

4.15 pm

Lord Lea of Crondall: My Lords, I welcome the debate introduced by my friend-if I may call him that, as he is my friend-the noble Lord, Lord Hannay. I was in the UKREP office referred to by the noble Lord, Lord Monks, on the very day that David Hannay's name was in the papers-I think it was the Daily Mail-as being appointed a people's peer. The people in UKREP said that they had not heard anything so funny in their lives.

I add my thanks to the right reverend Prelate the Bishop of London, about whose diplomatic experience, in the broadest sense of the word, we have just heard. I have witnessed the remarkable outreach job that he does in the St Paul's area and in London generally-a job that the Anglican community does in many countries around the world.

My noble friend Lord Monks-John Monks-is the fifth former general secretary of the Trade Union Congress to come to this House. He joins an illustrious list: Walter Citrine, who had an historic reputation in the trade union movement, including for his short book, The ABC of Chairmanship, which is used from the Pacific Islands to the Falkland Islands; Vincent Tewson, who followed Lord Citrine; and Victor Feather-George Woodcock must have declined the invitation, but I do not know that for a fact-who took the TUC through the difficult years of 1969 to 1973, from the proposals of Donovan and In Place of Strife to Ted Heath and all of that.

John's only fault is that he is too fond of irony. At a meeting with Mrs Thatcher in 1980 on the issue of red tape-too much regulation on small firms and so on-John asked, tongue in cheek, "So why not exclude small firms from the 30 miles an hour speed limit?", at which point Mrs Thatcher turned to a civil servant and said "Take a note of that". The white van man has certainly taken a note of it.

There is another similarity between working for the TUC and the Diplomatic Service. I was reminded of this only yesterday when the noble Lord, Lord Hannay, chaired a meeting with senior American diplomats on Afghanistan through the All-Party Group on Multilateral Nuclear Disarmament and Non-Proliferation, of which I am the secretary. One of them remarked that it might be useful to distinguish process from outcomes. I recognised that distinction and noted that trade union officials do that every day of the week. Before John mentioned the trio-now the duo-sitting in front here, I thought that perhaps the TUC should do some job swaps with the Foreign Office, but I think that they are probably already doing it.

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I have given the Minister-whom I admire without always agreeing with him-notice of this question: what is the headcount of the FCO and DfID at the present time, both in Britain and overseas? In the latter case, there is also the separate category of locally employed staff. We need to be able to track where, when and how this transition takes place, with the position before the cuts being the benchmark or starting line.

I know from experience that, if there are missions from five, six, seven or eight different European countries in a small African or South American country giving different advice about auditing, project finance or whatever, the messages from London, Berlin, Paris and Stockholm and so on are different, no matter that they get together once a week. Reality stands all this talk about defending the national interest on its head, because small countries often have only one man and a dog to listen to all the conflicting advice. That can be counterproductive and give a totally wrong impression. I have seen countries in many parts of the world waste the time of a very small number of competent people.

Someone should, therefore, challenge the doctrine of keeping all the UK missions quite separate. As we have very distinguished diplomats, we should-here I follow the message of the noble Lord, Lord Hannay-be on the front foot in the European External Action Service.

Coming to my final sentence, I have some sympathy with the argument about the cuts-

Lord Wallace of Saltaire: My Lords, we are very tight on time.

Lord Lea of Crondall: But that is an economic argument that goes wider than this debate.

4.22 pm

Lord Patel of Blackburn: I thank the noble Lord, Lord Hannay, for introducing and securing this debate. I, too, congratulate the noble Lord, Lord Monks, on his excellent speech.

The work of the FCO is fundamental to the work of this Government. I consider it an honour to have worked with the FCO on a number of projects and programmes. The work ultimately involved promoting British interests abroad.

We as a nation have much more to work towards in dealing with conflict in too many parts of the world, so the FCO will be key to ensuring a safe, prosperous and strong Britain. The FCO's consular services have an enviable reputation across the world as being among the best. Their support, advice and guidance are second to none and are essential if we bear in mind the huge number of Britons who travel abroad. During a time of hardship, the FCO is also essential in bringing in inward investment and exporting our goods and services.

I have been privileged to have been asked to lead FCO delegations to Egypt, Malaysia, Indonesia, Sudan, Pakistan and Bangladesh among others. The work of those delegations was to engage in dialogue and to highlight what Britain has to offer-its diversity and equality of opportunity being two key themes.

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In 1999, the UK was the first non-Muslim country to send a delegation to Saudi Arabia for the hajj pilgrimage to cater for the approximately 25,000 British pilgrims who attend over a two-to-four week period. Since 2001, I have led this delegation. The work involves providing consular, medical and support services to British pilgrims. The cost of the delegation is almost insignificant when compared to, let us say, a state dinner.

An FCO-commissioned independent evaluation published in 2006 clearly demonstrates that, for the cost of £120,000, the benefit to the UK of that delegation is estimated at more than £1.6 million. The benefits that the report identified were in four key areas: economic productivity lost as a result of illness back in the UK; reducing NHS hospital consultations in the UK; reducing in-patient readmissions in the UK; and reducing GP consultations in the UK.

I am sure that noble Lords would all agree that saving one life is valuable enough. Over the past 10 years, the delegation has saved thousands of lives. For example, a female British pilgrim was going into a coma at 2 am when a doctor from the delegation went to her tent. He was able to stabilise her while Saudi authorities responded. She would otherwise have died.

This year, without any formal consultation, the delegation has been cut. That is in spite of the fact that the delegation saves the UK money and works because of volunteer doctors. It is a true example of the big society, in which individuals give up their time to help others and ultimately the state. As stated, more than £1.6 million a year is saved. Given the monumental scope of last month's comprehensive spending review, the cut is just not logical.

Despite the reasons presented by the FCO and the noble Baroness, Lady Warsi, in her letter to me, Saudi medical services have improved, but given the high level of demand, more than 3 million pilgrims are still relatively inaccessible save in the most serious cases. The examples that I have stated rely heavily on early intervention to prevent serious or life-threatening cases from developing-a stitch in time saves 10 in the future.

The value of British doctors is great. They know and understand the diseases and symptoms that are particular to British pilgrims. For example, the delegation was successful in convincing Saudi medical authorities not to amputate a British pilgrim's leg because of infection and instead insisted on a course of drugs that removed the life-threatening infection.

Why did no public consultation take place? More importantly, why was there no consultation with Muslim organisations given that the service of the delegation in Saudi Arabia positively benefits British nationals? Was the Department of Health consulted? The FCO report of 2006 stated that the work of the delegation formed part of the FCO's race equality scheme to demonstrate its statutory duty under the Race Relations Act. Was a race equality impact assessment undertaken for the decision and, if so, what was the outcome, or is the FCO in breach of its statutory obligations?

Finally, I understand but do not agree with the rationale to abolish a delegation that saves more than £1.6 million per annum to the state. Did the FCO

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undertake a cost benefit analysis before it decided to end the delegation? Will it finalise figures to demonstrate how it came to that conclusion? Thank you.

4.28 pm

Lord Janvrin: My Lords, I add my thanks to my noble friend Lord Hannay for securing this Motion for debate today. I, too, declare an interest as a former member of the Diplomatic Service, although it was of a more humble status and variety than that of my noble friend.

This is a Motion of major importance and it is perhaps appropriate to be discussing it on Remembrance Day. If ever there was a reason to have a properly resourced and active diplomacy, it is to try to solve the world's problems, in Churchill's memorable phrase, through "jaw, jaw" rather than "war, war". Beyond this, many of the other reasons for speaking in support of this Motion have been eloquently put forward by others, including in particular the importance of soft power, the World Service and the work done by the British Council.

I share many of the views expressed and particularly welcome the noble Lord, Lord Monks, and commend his maiden contribution today. I shall add my voice on two points-the issue of resources and the importance of retaining an active global network. On the issue of resources, I recognise that many government departments contribute to our diplomacy, but I should like to focus on the FCO's resources. This to my mind is the budget which is so crucial to the orchestration of our diplomatic activities overseas. The FCO's departmental expenditure limit in 2010-11, including the World Service and the British Council, is £1.6 billion. This represents less than 0.5 per cent of the Government's total budget. If you take out the new arrangements for the World Service funding, the FCO budget is to be cut by 10 per cent over the period of the spending review. Are we able to say now, "Thus far and no further"?

I do not doubt that there might still be some efficiency savings to make, but anything more than limited savings should in my view be strongly resisted, for two reasons. First, the Diplomatic Service has recently had to reduce its budget savagely in the light of exchange rate fluctuations, as my noble friend Lord Hannay reminded us. I welcome the spending review commitment to introduce a new foreign currency mechanism to manage exchange rate pressures. This must surely be right for the proper management of our diplomatic effort. I welcome anything that the Minister can tell us about this mechanism. Secondly, and most obviously, we are talking about really small amounts of money in overall government expenditure terms. Squeezing even limited savings out of the FCO budget will have a major impact on our diplomatic effectiveness; it will have precious little part to play in reducing our wider national budget deficit and we ought to recognise this.

This brings me to our global presence. We could trim our diplomatic reach to fit an ever smaller budget, but is this really the moment to do that? The world order is shifting; we have moved from superpower duopoly to G7/8 and now G20. The politics of globalisation, the economics of the emerging markets

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and the international consequences of climate change are shaping our diplomatic agenda. We have moved on from BRICs and are already looking at the emerging markets of tomorrow, including South Africa, Turkey, Indonesia, South Korea. The map of diplomatic and economic power is changing fast. We need to respond to the opportunities and the challenges of globalisation, not by withdrawing in on ourselves but by playing to our huge historical advantage of being an outward-looking trading nation with global links.

It is only by having a global network that we can be in a position to deal with the unexpected in this increasingly globalised world. We cannot know now what will be the future threats to our security, the opportunities for our business, or indeed the new pressures on our consular services. A properly resourced global presence must be part of the answer to dealing with the uncertainties of the future.

This brings me to my final point. Regardless of the internet and instant communication, it is only by having people in post and active on the ground around the world that we can continue to build and retain that deep political insight, that economic knowledge and that cultural perspective along with the language skills and the lasting, reliable contacts which are of real value to government and business. We need to retain that global network because once you close a mission, you lose it.

In conclusion, I pay tribute to the many men and women serving at home and overseas who are part of our national diplomatic effort. Many of them work in difficult and dangerous circumstances and they are certainly often the subject of admiration around the world. I am pleased to have this opportunity to speak in their support this afternoon.

4.36 pm

Baroness Drake: My Lords, the Foreign Secretary's speech delivered in July outlined the coalition Government's diplomatic vision. Britain's foreign policy is to be shaped around a number of key geopolitical challenges. Foremost among them is the establishment of stronger links to emerging economic powers, in order to gain influence and an improved foothold in the burgeoning markets of countries such as China, India and Indonesia. Britain's need to generate wealth through trade is paramount, so few would argue that this kind of relationship-building should not be a top international priority. The process behind it is both complex and demanding, so the case for Britain to be equipped with a properly resourced and active diplomacy should be universally apparent. The reservation I have lies in the terms on which Britain's future is articulated.

A pertinent question for debate centres on what, substantively, our diplomatic approach should be. When we talk of the need to build relationships with emerging economic powers, it effectively translates into a process of engagement with their Governments in the hope that mutually beneficial trade agreements can be established. The greatest challenge surrounding this endeavour is often identified as being that many of those countries do not share the same historical development as the UK and its counterparts in western Europe and North America, and that therefore they

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do not possess the same priorities and world views. Commitments to human rights, gender equality and political liberalisation, for example, may not be as strong in these societies as they are in our own. Such a diagnosis can indeed seem intuitive in light of the prevalence of misunderstanding and antipathy that is identifiable across the world today.

That is not a new problem. Experience has taught us that it is neither advisable nor feasible to expect another country to accept automatically that, in order for it to gain entry into the family of leading nations, it must embrace what we and others understand as the pillars of acceptable governance. For Britain, therefore, a dilemma presents itself-one that I am certain we will encounter increasingly in the future: that balance between the importance of our own economic prosperity and the well-being of the citizens of the countries with which we do business. Like the noble Baroness, Lady Falkner, I feel that we need to establish with greater clarity our international priorities.

There is no straightforward blueprint for the encouragement of social freedoms. I do not, however, subscribe to the view that certain cultures are intrinsically resistant to liberalisation. On the contrary, I believe that the universality of democracy and human rights lies in their universal appeal. We must avoid the adoption of a "clash of civilisations" world view that inadequately explains the international environment, portraying it as a series of rival and largely incompatible systems. This only serves to reinforce the already robust barriers that divide nations and ferment antagonism. If we are to learn anything from the global events of the last decade, it is that we must develop a more nuanced understanding of the world around us-one that avoids assumption, cliché and stereotype.

If it is to be lasting, the respect for human rights must be organic and possess credibility within the society concerned. Achieving this will be extremely difficult. There will be times when we should acknowledge that we have no political or indeed moral right to get our own way, especially when it is at the expense of ordinary people of other nations. While we continue to promote the introduction of democracy and human rights in tandem with economic pursuits, the temptation to relax the former for the benefit of the latter will always remain.

Actively building relationships with new economic powers is an opportunity to develop novel and lasting international alliances that cement Britain's reputation as a country that operates globally, according to an intelligent mix of pragmatism and principled action. To achieve this, though, we need not only to build bilateral partnerships but to promote multilateral action. In the face of unpredictable geopolitical circumstances, we must alter our outlook from one that focuses on what divides us from these other nations to one that emphasises the inherent and shared interests and characteristics identifiable in all human beings. Our diplomacy must be properly active.

Britain's future and international priorities must be articulated and pursued in such a way that our efforts to encourage liberalisation within the societies of new global partners are not rendered perfunctory by the pursuit of our own economic interests. For real results

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to be achieved, the freedoms and safeguards that we value must be framed in such a way as to appeal to as many different parties as possible. I argue that this is a diplomacy that is also properly resourced in its psychology, and one that is more likely to meet with success.

Like my other colleagues, I take this opportunity to add my thanks to the noble Lord, Lord Hannay, for securing this debate.

4.42 pm

Lord Parekh: My Lords, I, too, thank the noble Lord, Lord Hannay, for securing and introducing this debate. As he rightly said, we are a middle-ranking power with limited resources but, thanks to our history, we have a global presence and a good reputation. Although our uncritical support for the US-led invasion of Iraq did us great damage, we are widely respected for our commitment to certain values and our ability to blend political realism with moral idealism.

Being a middle-ranking power, our hard power is limited. So far as what is called "soft power" is concerned, I am not sure that the term really makes much sense. It is a metaphor based on "hard power" and, like all metaphors, it is indeterminate and ambiguous. I have debated this with the father of the phrase, Professor Joseph Nye, and he takes it to mean "the ability to get others to think the way that we do". I am not sure why we would want to do that; it has an element of intellectual seduction and manipulation, and I should have thought that diversity of view had much to be said for it. I would rather think that our concern should be to ensure that others think well of us, take care of our interests, are concerned about us and wish to be close to us. In other words, rather than talk about power, soft or otherwise, we should be thinking of building bonds of interest and affection with other countries.

If that is the goal, and it ought to be, there are three or four things that we should be aiming at. First, as a country, given our history and geography, we stand for certain values like human rights and mutual respect between nations. We ought to be able to display those values in our foreign policy. We should also encourage them in other countries, but never in a hectoring or arrogant spirit. The banal dichotomy of either intervention or indifference is not an option. I would like to think that the Prime Minister has shown how this can be done in his recent talk to students in China, talking about human rights, not as if it were a western export but rather something that China itself should want in order to create a stable and vibrant society.

Secondly, we live in a world of free and proud nations with different cultural traditions. It is extremely important that we should conduct our relations with them in a manner that does not offend or alienate them. There have been hilarious examples in recent years of how we can easily end up offending them. I was told-I hope this is not true-that one of our Foreign Secretaries, on a visit to India, addressed the Indian Prime Minister by his first name. You do not do that kind of thing. I was also told that the first Indian Prime Minister, Pandit Nehru, once complained to Sir Isaiah Berlin that, although he found American diplomats brash and full of themselves, he could handle

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them, while he had some difficulty with the British, whom he thought were rather patronising with an effortless air of superiority. He said, "I can't handle that, having suffered it when I was a student at Cambridge".

Having talked to Indian diplomats in recent years, I am told that things have changed considerably but, nevertheless, there are occasional glimpses of that effortless superiority. We ought to be careful about that. In other words, I am suggesting that we make sure that our diplomats are multiculturally literate and able to talk to people in other countries in the terms of the language and traditions that they share.

My third point has to do with the fact that the Foreign and Commonwealth Office should be open to new ideas and long-term perspectives. I am thinking not simply about tactical responses to this or that crisis, but rather about the deeper factors that influence a situation so that our response to a crisis is grounded in a long-term analysis. That will require that more of our academics and journalists are involved in the formulation of FCO thinking. In that context I ask the Minister: how many of the senior personnel in the FCO and in our diplomatic missions come from the ethnic minorities? My feeling is that, despite being a multiethnic society, we tend to present a rather monocultural, mono-ethnic profile to the world outside.

My fourth point has to do with our educational institutions, which play a crucial role. Overseas students are attracted to our great universities, and they are tomorrow's leaders in government, business and the arts. It is very important that we should attract them, fund them and invest in them. The Chevening scholarships should therefore not be reduced. They are one way in which we invest in our own future.

In that context, we must also take a second look at the BBC World Service. It is widely respected as a source of unbiased information. As the noble Baroness, Lady Afshar, pointed out, the BBC's Persian service, for example, is widely respected. It is striking that President Obama chose to give an interview to the BBC's Persian service to reach out to the people of Iran and to refute President Ahmadinejad's comments before the United Nations General Assembly in September. It would be a great mistake to deprive the BBC of this capacity to reach out to many people.

Finally, I greatly welcome the fact that the Prime Minister has set his heart on having special relations with India. The two countries have had close ties over the centuries, not just because of the imperial connection but going back further. This does not mean that Britain should be silent in those areas where India is wrong-for example, over Kashmir. I have protested strongly over the years that India's policy in Kashmir is to be deeply faulted. At the same time, this can be done in different ways. Given the presence of the Indian diaspora, it is important that its people should be involved in formulating Britain's policy and liaising with India.

4.49 pm

Lord Sheikh: My Lords, I also express gratitude to the noble Lord, Lord Hannay, for securing this debate. Effective diplomacy is paramount in dealing with the

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emerging and existing challenges facing our nation, including tackling the effects of climate change, promoting free trade and protecting human rights. It is important not just to focus on our historic relationships but to seek avenues for building new friendships and influence with emerging players.

First, our diplomacy should recognise the importance of greater dialogue between the Department for International Development, the Ministry of Defence and the Foreign and Commonwealth Office. These departments are paramount in achieving progress through active and efficient diplomacy. The challenges facing our nation and the world at large require a multifaceted approach to how we conduct future relations. I was surprised to learn that officials from different government departments operating abroad do not work together routinely and are often located in different buildings. That is unsatisfactory and can only add to the expense while also undermining our effectiveness in projecting foreign policy abroad. I am pleased that the Government appear to have this in hand and hope that the Minister will be able to offer clear assurances on this point.

While strengthening existing relationships, we must forge greater ties with emerging economies such as the BRIC countries and the Gulf states where economic growth is likely to be considerable. During the year I visited Russia, Turkey, Qatar, Kuwait, Brussels and the United Arab Emirates, where I spoke at international conferences on boosting trade and achieving sustainable development. I recently visited Sri Lanka as a member of the Commonwealth Parliamentary Association delegation. I was impressed with the quality of our high commissioner and his staff but feel that there are business opportunities which we can pursue. We can also consider providing resources to aid in rebuilding the country.

I am pleased to note that the Secretary of State has undertaken to overhaul our network of foreign embassies, turning them into engines for trade that support our ambitions for an export-led recovery from the current economic situation. I see no reason why leading business people should not be appointed to diplomatic posts, and I commend the Secretary of State on his vision in making this announcement and undertaking to deliver on it. This accords directly with my experience of travelling across the world and speaking with key figures. The recruitment of senior business people should provide a new impetus for us to maximise trade opportunities, to deliver economic and political benefits to all parties.

I have established and maintained good relationships with the ambassadors and high commissioners of a number of countries and their diaspora. There is good will towards the United Kingdom but we need to build on these relationships further.

I support the Government's effort to strengthen our economic strategy and commercial relationships with China and India. I was very pleased that our trade delegation to both countries was headed by the Prime Minister. We need to rectify the difficulties caused by our present economic situation. We can achieve this through spending cuts and raising taxes but we need also to look at ways of strengthening our business activities overseas. By increasing our trade with overseas

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countries, we not only generate wealth but also strengthen our political, social and cultural ties with them. Diplomacy has a key role to play in achieving these objectives.

I have spoken on several occasions and led a debate in your Lordships' House on the importance of the Commonwealth. The linguistic and administrative legacy of British rule suggests that it costs less to trade within the Commonwealth than outside it. We need to work towards building closer business and social links with Commonwealth countries. However, we should not embark upon this at the expense of building wider alliances. We cannot use the opportunity to look at the issue of diplomatic activities without also considering the impact of the European External Action Service. A consequence of the Lisbon treaty, this approach could have a profound impact on our diplomatic footprint. We should not allow our footprint to diminish at the expense of European infrastructure that may be less efficient or effective.

I believe that the European External Action Service, now that it exists, should be harnessed to exert maximum influence. We should be proactive in helping to shape its agenda so that it can contribute positively on the international stage.

I would welcome further proposals to expand the United Nations Security Council. The emerging global order suggests that such an expansion is inevitable. I acknowledge that this will indeed result in challenges to our diplomacy as it will require efforts to extend and increase our influence among a larger group of countries. Effective diplomacy is necessary in order to secure our international prosperity. Our diplomacy requires a flexible and steadfast approach to how we further our interests in the emerging world order. This will undoubtedly contribute towards the reinforcement of British influence and prestige in global affairs.

Finally, I have been on pilgrimage to Saudi Arabia several times and agree with all the points made by the noble Lord, Lord Patel of Blackburn. I might add that I chair the Conservative Muslim Forum but there was no consultation on this with me or my members.

4.55 pm

Baroness Taylor of Bolton: My Lords, I congratulate the noble Lord, Lord Hannay, on initiating this debate. I agreed with most of what he said and was particularly pleased that he sought further clarification from the Minister on our response to the EAS. I am glad that those remarks have just been echoed. I was also particularly pleased with his comments on cross-departmental co-operation, a subject to which I shall come back in a moment. I congratulate my noble friend Lord Monks. I do not know how many noble Lords noticed that he managed to slip in a reference to Manchester United in a debate on diplomacy. We may hear other such interventions in future but I am sure that they will be welcome, even on the part of those who do not support that team.

I wish to take up the final point made by the noble Lord, Lord Sheikh, who referred to the remarks of my noble friend Lord Patel of Blackburn. My noble friend spoke about a topic that he knows well. I suspect that few noble Lords have experienced the difficulties to which my noble friend referred in connection with hajj

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pilgrimages. When representing my former constituency in another place I was very well aware of those problems. I congratulate my noble friend on the very significant improvements that he has made. It is important to recognise that these are very real problems, not least because of the language difficulties that sometimes arise when people attend this important event. I hope that the Minister will look at that issue again as it is very important.

The noble Lord, Lord Hannay, said that this debate was timely given the announcement of the comprehensive spending review. It is also timely as tomorrow we will debate the strategic defence review. While that debate will rightly concentrate on aircraft carriers and Harrier jets, the two issues need to be considered together as we want a joined-up approach. It is important that we concentrate on that. In that context I remind the House of the Ministry of Defence Green Paper published in February this year entitled Adaptability and Partnership, which is a very important reference document for today's discussion and tomorrow's. Today's theme is active diplomacy. One of the questions posed in the Green Paper is how we can deploy the Armed Forces more effectively to support wider efforts to prevent conflict and strengthen international stability. In the section of the Green Paper on adaptability and influence, mention is made of the work carried out by the Foreign and Commonwealth Office, the Ministry of Defence and DfID in order to understand better the contribution that defence diplomacy and security co-operation can make to wider government efforts.

My purpose in intervening today is to underline how important it is not to lose sight of the very important, sometimes critical, and often unique, role that defence diplomacy can play. During my time at the MoD I saw many examples of this work. I understand that we cannot always talk openly about this but defence diplomacy makes significant contributions across a wide field that people sometimes forget. I shall mention just one. The British Military Advisory and Training Team, based in the Czech Republic, works with it and others to provide multinational training courses both on peacekeeping operations and on the wider basis. It is important to realise that we are not just working with NATO allies in that; there are 31 partner countries, from central Asia, the Caucasus, the Balkans and north Africa. Indeed, when I visited, I was impressed to see someone from Azerbaijan sitting next to an Armenian, which you would not get in most circumstances. That approach shows the influence of soft power and the fact that this country can be extremely important in making sure that such things happen.

Time is short, so I shall just say that I think that those working in aid are sometimes apprehensive about people in military uniform providing advice in a country. However, as the DfID White Paper of last year pointed out, unless you have security and stability on the ground, it is often impossible to provide aid. Very often, people in fragile states who are in uniform will take advice only from other people in uniform. It is important that we build on that sort of thing.

I emphasise a significant step forward-the establishment of the stabilisation unit. That brought together not just funds from the FCO, MoD and

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DfID, but many of the personnel who now work together in a productive way.

I hope that the Minister will confirm that, in this compelling case for an active diplomacy, there is also a compelling case for defence diplomacy, and that the words in support of that uttered by Ministers will not just be words but will be translated into very direct and very positive support.

5.02 pm

Lord Jones of Cheltenham: My Lords, I thank the noble Lord, Lord Hannay, for securing this important debate. He has great experience in the field and has made an unanswerable case today for a properly resourced and active diplomacy. I congratulate the noble Lord, Lord Monks, on his maiden speech. It is some years since he and I marched shoulder to shoulder with many others-including the noble Baroness, Lady Symons, the noble Lord, Lord Brett, and probably the noble Lord, Lord Lea-in support of GCHQ trade unionists in Cheltenham. He made an excellent speech today and I hope that we will hear more from him soon. I make him this offer: if Cheltenham Town are drawn at home to Manchester United in the FA Cup this year, I will make sure that he gets a ticket. If we are drawn away, I hope that he will do the same for me.

I want to make three points. The first is to thank those diplomats I have met in this country and overseas. The second is to give some anecdotal examples of the work that I have seen them do. The third is to express frustration that in recent years we have undervalued and underresourced our diplomacy.

One of the most challenging projects on which I worked before entering Parliament was in Iraq during Saddam Hussein's era. My task was to ensure that new British computer systems installed at Baghdad University did what was required of them. At the time I did wonder why we were selling computer systems to the Iraqi regime, which was at war. I was more concerned when I was asked to provide support to British systems in the Iraqi defence department. British Ministers gave their approval to those exports; the logic was that Iraq's being opposed to Iran meant that Iraq was on our side. How things change. These systems were mentioned in the Scott inquiry into arms for Iraq.

I wonder what advice our diplomats in Baghdad gave to our Government of the time on whether those "sales" were advisable. A properly resourced diplomacy can and should give timely advice to the Government on commercial, cultural and security issues, and the Government should take notice of that advice before taking decisions which could have far reaching implications. I know that our diplomats gave advice on new missile systems produced by Iraq when I was there. The al-Hussein missile was powered by a lawnmower engine. The later al-Samoud missile was similar in design, but powered by an uprated lawnmower engine. The guidance system was such that the launchers put their fingers in the air to judge the strength of the wind, made a calculation and filled the device with the appropriate amount of fuel. When the fuel ran out, the missile dropped out of the sky onto whatever lay beneath. They were not the most accurate of missiles.

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I know that our diplomats fed back information on Iraq's military capabilities, so I wonder how the infamous "dodgy dossier" prior to the second Gulf conflict came into being to justify the claim that Iraq posed a threat to the United Kingdom and could launch weapons of mass destruction in 45 minutes. Why was advice from our diplomats in Iraq not heeded? A lot of lives, as well as a lot of money and Britain's reputation, could have been saved if we had avoided that unnecessary conflict.

I take a special interest in Africa and have visited many countries where I have seen the work of our diplomats. I have literally been saved by several of them. On a Commonwealth visit to Malawi, our vehicle was in a collision with a passing cyclist. Immediately, we were surrounded by a huge and angry crowd demanding vengeance on our driver. It was a very nasty situation. One of the diplomats, a lady, shepherded the MPs to another vehicle, ordering, "Get the VIPs out of here", before calmly dealing with the crowd, taking the cyclist to hospital, where it was discovered that he was drunk and not badly hurt, and she arranged for a new bicycle to be delivered to him.

While observing elections in the Gambia, our delegation came across a riot in which at least one person had been shot dead and a Minister's house set on fire. After listening to what the crowd had to say, we returned to our vehicle and shots rang out again. It felt as though we were being shot at. Fortunately, the British high commissioner and his staff helped us to recover.

Another incident occurred while observing elections in Ghana at the end of Flight Lieutenant Jerry Rawlings's presidency. On the eve of poll, the British deputy high commissioner explained that there had been trouble in northern Ghana. We went to an independent radio station, Joy FM, which, through its sister station, Love FM, confirmed that a melee had taken place and a dozen or more people had been arrested, including an opposition candidate. When this news was broadcast, a group of large, uniformed, armed men arrived and told the radio station to stop broadcasting. I found these men from the Bureau of National Intelligence to be intimidating, but they were nowhere near intimidating enough for the deputy high commissioner who pointed out: first, that democracies do not close down independent radio stations; secondly, that international election observers were present and would include this incident in their report on the conduct of the elections; and thirdly, that if they did close down the radio station, the elections might well be judged not to have been free and fair, and it would all be the fault of the men in uniform. Eventually the men turned and left. If we had not been there, and if that diplomat had not taken calm and considered action, Ghana 2000 might well have joined a long list of failed elections around the world. As things turned out, there was a peaceful change of Government, which was a credit to the growing maturity of Ghana's democracy.

That diplomat-now no longer in the service-was Craig Murray, who became our ambassador in Uzbekistan. During his time there he discovered and reported back on appalling incidents of torture, implicating the United States, which was believed to be receiving information obtained under torture. Instead

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of acting on the information provided by one of his most senior diplomats, the Foreign Secretary recalled him to the UK and dismissed him. That was a great injustice.

In many of the places I have visited, diplomats have told me of their frustration that the United Kingdom could and should be doing so much more if only our diplomatic services were properly resourced. The advantages are self-evident in terms of trade and in relation to human rights and progress. Recent reductions of British diplomatic presence in certain parts of the world give the unfair impression that we cannot be bothered any more. In his reply, I hope that the Minister will set our minds at rest that the coalition Government understand what has been said in this debate and will ensure that in future we have a properly resourced and active diplomacy.

5.09 pm

Viscount Waverley: My Lords, I am grateful for the suggestion that the Diplomatic Service be open to new ideas. While there is apprehension about the cuts, active diplomacy in certain areas can deliver mechanisms to achieve results with less. The way forward might be to recognise that the role of government in bilateral relations, and by extension diplomatic endeavours, should be to create the environment to allow all the sectors that make up those relations to thrive, and that the United Kingdom is essentially a private sector-driven economy and that it is not the role of government to deliver for the private sector a better structured public sector/private sector partnership, whether for the benefit of trade or for the myriad other benefits that make up relationships.

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