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Libya and the Middle East


5.32 pm

The Chancellor of the Duchy of Lancaster (Lord Strathclyde): My Lords, this might be a convenient moment for me to repeat a Statement that was made in another place by the Prime Minister earlier this afternoon. The Statement is as follows.

"Mr Speaker, I would like to update the House on the evacuation of British nationals from Libya, the actions that we are now pursuing against Colonel Gaddafi and his administration and developments in the wider region.

We have been working intensively to get our people out. As of now, we have successfully removed around 600 British nationals from Libya. The evacuation has centred on three locations: Tripoli airport, the port at Benghazi and the desert oil fields. At Tripoli airport, a series of six aircraft organised by the Foreign Office and an RAF C130 Hercules flight have brought out more than 380 British nationals and a similar number of foreign citizens. At Benghazi, HMS 'Cumberland' has carried out two evacuations from the port, taking out 119 British nationals and 303 foreign citizens. The first of these evacuations took place in very difficult sea conditions. The second arrived in Malta earlier today. These evacuations were assisted on the ground by five rapid deployment teams. In total nearly 30 extra staff from the Foreign Office helped marshal British citizens in the midst of chaotic scenes in and around the airports and ports.

The most challenging part of the evacuation has, of course, involved those British nationals scattered across over 20 different locations in the oil fields deep in the desert. On Friday evening, I authorized a military operation to bring as many as possible out of the desert. On Saturday, two RAF C130 aircraft flew into the eastern desert and picked up 74 British nationals and 102 foreign nationals at three different locations. A second mission took place yesterday, bringing out a further 21 British nationals and 168 foreign nationals. On the second mission, one of the aircraft involved suffered minor damage from small arms fire. This underlines the challenging environment in which the aircraft were operating.

Indeed, Britain has taken on a leading role in co-ordinating the international evacuation effort. Our AWACS aircraft are directing international aircraft involved. Brigadier Bashall, who is commanding the

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operation, has established a temporary joint headquarters in Malta. I have thanked the Maltese Prime Minister personally on behalf of the country. Not for the first time in our history we must pay tribute to Malta and her people. In terms of numbers of British citizens remaining in Libya, this is, of course, difficult to ascertain precisely given the situation on the ground. Many of them will be dual nationals and not all of them will want to leave. I asked for urgent work to be done on accurate numbers in both categories: those who wish to leave and those who currently do not. Our current indications are that, as of today, there are fewer than 150 British citizens remaining in Libya, of which only a very small proportion wish to leave. Clearly this can change at any time. We will keep the House regularly updated.

We will continue to do all we can to ensure that those who wish to leave can do so. HMS 'Cumberland' will remain in the area, together with HMS 'York', which also stands ready off Tripoli to assist. We have military aircraft, including C130s and a 146, in Malta ready to fly in at very short notice. The Government will continue to focus on making sure our citizens are safe. COBRA has met regularly to co-ordinate the effort and I personally chaired three meetings over the weekend. The National Security Council is looking at the overall strategic picture, meeting last Friday and again today, not least to look at other risks to British citizens in the wider region. As I said last week, there will be lessons we will wish to learn from this evacuation, including in respect of the hiring of charter aircraft, use of defence assets and the need for greater redundancy.

Clearly an important decision was when to extract the embassy. This was taken at the COBRA meeting on Friday and carried out on Saturday after the remaining civilians had been extracted from Tripoli airport in parallel with the start of desert operations, which were of course planned from Malta. Our judgment throughout has been that the risk to British citizens has been growing. The Americans, French and Germans have similarly suspended the operations of their embassies. Britain also retains a consul in Tripoli and a consular warden in Benghazi. We have arranged that Turkey, which still has several thousand of its own citizens in Libya, will look after British interests while our embassy's operations remain suspended.

I am sure that the whole House will want to put on record its thanks to all those who have made the rescue effort possible, to the skill of the RAF pilots, to all those involved from all three armed services, to our diplomatic service and to all those who put themselves in harm's way to help our people leave safely.

Let me turn to the pressure we are now putting on the Gaddafi regime. We should be clear. For the future of Libya and its people, Colonel Gaddafi's regime must end and he must leave. To that end we are taking every step possible to isolate the Gaddafi regime, deprive it of money, shrink its power and ensure that anyone responsible for abuses in Libya will be held to account.

With respect to all these actions, Britain is taking a lead. Over the weekend, we secured agreement for a UN Security Council resolution, which we had drafted and which is unusually strong, unanimous and includes

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all of our proposals. It condemns Gaddafi's actions, and imposes a travel ban and assets freeze on those at the top of his murderous regime. It demands an immediate end to the violence and the killing of protesters, access for international human rights monitors, the lifting of restrictions on the internet and media, an end to the intimidation and detention of journalists and refers Libya's current leaders to the International Criminal Court to face the justice they deserve.

We were also the driving force behind a special session of the UN Human Rights Council on Friday, which started work to eject Libya from the council; and the Foreign Secretary is in Geneva today along with US Secretary of State Hillary Clinton to see this work through. With our European partners, we have today secured agreement on freezing the assets of a wider group of individuals, banning them from entering the European Union and also imposing a wider arms embargo on the Libyan regime. Britain is also leading in implementing these direct measures against the regime.

I can tell the House today that here in the UK a special Privy Council session was held yesterday as a result of which we have now frozen the assets of Gaddafi, five of his family members, people acting for them or on their behalf and entities that are owned or controlled by them. The Treasury has stepped in to block a shipment of some £900 million in banknotes destined for Libya. The Government have revoked Colonel Gaddafi's immunity as a head of state and neither he nor his family may freely enter the UK any more. We have also revoked the visas of a number of Libyans linked to the regime who are now on immigration watch lists.

We will look at each and every way of stepping up pressure on this regime, including further isolation of the regime by expelling it from international organisations and further use of asset freezes and travel bans to give the clearest possible message to those on the fringes of the regime that now is the time to desert it. We do not in any way rule out the use of military assets. We must not tolerate this regime using military force against its own people. In that context, I have asked the Ministry of Defence and the Chief of the Defence Staff to work with our allies on plans for a military no-fly zone. It is clear that this is an illegitimate regime that has lost the consent of its people. My message to Colonel Gaddafi is simple: go now.

Everyone hopes this situation will be resolved quickly but there is a real danger now of a humanitarian crisis inside Libya. We are acutely conscious of the risks of shortages and are monitoring the situation closely. We have dispatched technical teams to be in place at both the Tunisian and Egyptian borders. Currently the most pressing need is assisting the large numbers of migrant workers into Egypt and Tunisia to get home. Tomorrow, in response to a request from the UN, Britain will fly in tents and blankets from our stocks in Dubai for use at the Tunisian border. The International Development Secretary will be visiting the region later this week to assess the situation on the ground for himself.

North Africa and the wider Middle East are now at the epicentre of momentous events. History is sweeping through this region. Yes, we must deal with the immediate consequences, especially for British citizens caught up in these developments, but we must also be clear about

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what these developments mean and how Britain and the West in general should respond. In many parts of the Arab world, hopes and aspirations which have been smothered for decades are stirring. People, especially young people, are seeking their rights, and in the vast majority of cases they are doing so peacefully and bravely. The parallels with what happened in Europe in 1989 are not, of course, precise, but there is no doubt that many of those who are demanding change in the wider Middle East can take inspiration from other peaceful movements for change, including the velvet revolutions in central and eastern Europe or the peaceful transition to democracy in Muslim countries like Indonesia. Of course there have been many disappointments in the past, but those of us who believe in democracy and open societies should be clear: this is a precious moment of opportunity.

While it is not for us to dictate how each country should meet the aspirations of its people, we must not remain silent in our belief that freedom and the rule of law are what best guarantee human progress and economic success. Freedom of expression, a free press, freedom of assembly, the right to demonstrate peacefully-these are basic rights, and they are as much the rights of people in Tahrir Square as Trafalgar Square. They are not British or western values but the values of human beings everywhere; so we need to take this opportunity to look again at our entire relationship with this region, at the billions of euros of EU funds, at our trade relationship and at our cultural ties. We need to be much clearer and tougher in linking our development assistance to real progress in promoting more open and plural societies, and we need to dispense once and for all with the outdated notion that democracy has no place in the Arab world.

Too often in the past, we have made a false choice between so-called stability on the one hand and reform and openness on the other. As recent events have confirmed, denying people their basic rights does not preserve stability, rather the reverse. We should be clear too that now is not the time to park the Middle East peace process, quite the opposite. This is a problem that is long overdue for resolution, and we should use developments in the region to drive forward progress, not hold it up. In short, reform, not repression, is the way to lasting stability. No one pretends that democracy and open societies can be built overnight. Democracy is the work of patient craftsmanship, and it takes time, as we know from our own history, to put its building blocks in place. What is happening in the wider Middle East is one of those once in a generation opportunities, a moment when history turns a page. That next page is not yet written. It falls to all of us to seize this chance to fashion a better future for this region, to build a better relationship between our peoples and to make a new start. As the inspiring opposition leaders I met in Tahrir Square said to me last week, 'we now have the opportunity of achieving freedoms that you in Britain take for granted'. I am determined that Britain will not let them down, and I commend this Statement to the House".

5.47 pm

Baroness Royall of Blaisdon: My Lords, I thank the Leader of the House for repeating the Statement on

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Libya and the Middle East made by the Prime Minister. I should like to ask him about four areas-the immediate safety of British nationals, the future of the Libyan regime, the wider Middle East, and the lessons learnt from this crisis. First, however, I should like to join the Leader in expressing the deep and abiding gratitude of this side of the House to the members of the British Armed Forces, who have succeeded, with such extraordinary courage and professionalism, in evacuating so many of our own citizens, and those of many other countries, from Libya over the past week. These brave men and women are a credit to our nation. I also add my thanks to the Foreign Office staff on the ground in Libya for their efforts.

Our first concern must always be the safety of our own people. For obvious operational and security reasons, I would not expect the Leader to discuss any future operations; but can he assure the House that all contingencies continue to be looked at in relation to any remaining UK citizens stranded against their will? Given the closure of the British embassy on Saturday, can he reassure us that everything is still being done to keep in close contact with those citizens who remain and tell us what means of communication are available to them?

On the question of Libya's political future, I think that the whole House will endorse the view, publicly expressed by the Prime Minister today, that the only acceptable future is one without Colonel Gaddafi and his regime. We welcome what the Leader of the House says about a possible no-fly zone. We also welcome the international isolation of Colonel Gaddafi expressed in UN Security Council Resolution 1970, including sanctions, an arms embargo and a decision to refer the killing of protestors to the International Criminal Court. The resolution imposes travel bans for 17 Gaddafi loyalists and asset freezes on six of those individuals. Do the Government think that the asset freezes go wide enough in covering all those beyond Colonel Gaddafi's immediate family who have made the decision to stand with him? Will the Government make full use of the provision in paragraph 23 of the resolution to nominate additional regime members who should be targeted by travel bans and asset freezes?

On the human rights situation, there is clearly a growing humanitarian crisis on the Tunisian and Egyptian borders. On these Benches, we welcome the Statement's points on British action to help the humanitarian assistance to displaced migrant workers, and we look forward to the report later this week on the visit of the International Development Secretary. I understand that one of the most pressing needs identified by the Tunisian Government is transport for displaced workers from Libya who wish to return to their own country. May I ask the Leader of the House to draw this to the attention of the Secretary of State for International Development for his consideration during his visit to the region this week?

I turn to events beyond Libya, in the wider region. The events now unfolding across the Middle East are as significant as the revolutions that liberated eastern Europe in 1989, as the Statement says. Our response to them needs to be equally ambitious. There is a popular will in many of these countries for democratic reform.

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This movement is in line with the values that we share, and the stability promised by the undemocratic regimes in many cases has turned out to be hollow. Does the Leader of the House therefore agree that there must be no question but that our hopes-indeed, our interests-lie unequivocally with those demanding economic and political reform?

Does the Leader agree that we need to build a strategic response, including closer economic ties, support for civil society and institution building? However, does he agree that, in order to do so, we have to embrace closer contact with civil society, including academic institutions and non-governmental organisations committed to building a democratic future for their citizens? In respect of that aim, does he agree that full support should be given to the work of bodies such as the British Council and the Westminster Foundation for Democracy, both of which have carried out important work in this area over the past few years?

Does the Leader concede that while there is much that we can and should do bilaterally, real progress will require sustained will and effort at a multilateral level, including via the European Union? Can he tell the House whether the negotiations for an EU-Libya association agreement on both free trade and human rights have been suspended? Libya is a member of both the Arab League and the African Union. Can the Leader say what efforts the Government have made with the countries of both organisations to bring pressure to bear on the current Libyan Government against the violence that we have seen? Does he also agree with these Benches that it would be a tragedy if in this moment of change the opportunity was not grasped to make progress on the issue of Israel/Palestine? I therefore give the support of these Benches to the Government's calls for the rapid resumption of talks between Israel and the Palestinians, and to the Government's decision to support the recent UN Security Council resolution on these settlements. Can he say what steps the UK will now be taking to get negotiations moving again? On the question of arms sales, can the Leader confirm that the Government will work with EU partners to strengthen the guidelines and their operation?

Finally, I should like to ask about the lessons to be learnt from the immediate crisis response during the past week. Many Members of your Lordships' House, on all Benches, have in recent days either been aware of or had close experience of people who have been deeply anxious about family members, friends, colleagues or others stranded in Libya. I add our thanks to those expressed by the Prime Minister to the Maltese Prime Minister for the evacuation of British nationals and everything else that he is doing to assist. However, does the Leader accept that the Foreign Office should have done more, as other countries did, to ensure that planes were on the ground in Libya on Tuesday, rather than late on Wednesday night, to evacuate our citizens? Can he explain why this happened? Given the scale of the emergency and the transparent need for co-ordination across government, do the Government now agree that the emergency committee, COBRA, should have been convened earlier than Thursday? Can he explain why this did not happen? Can he also

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share with the House the wider lessons that have been learnt on the Benches opposite about the running of the Government?

I think that the whole country has now, thankfully, seen the scale of response that can be mobilised to help our citizens, and we are grateful. However, can the Government promise that British nationals abroad in future will not be let down as they were by the chaos and incompetence of early last week?

The Statement mentions the crucial role played by HMS "Cumberland" in the evacuation of British and foreign nationals. I was in Plymouth myself on Saturday and the citizens in Plymouth were immensely proud of what that ship was doing. Can the Leader give the House a clear assurance that the defence cuts currently planned will not in future preclude such vital rescue tasks for our citizens caught up in violence overseas?

Is the Leader satisfied with the way in which the warden system has worked? There have been reports that some of those working in the oilfields have found it very difficult-for some, impossible-to make contact with our consuls or with the embassy. I would welcome the opportunity to raise one or two of these issues later with the Leader of the House on Privy Council terms, if he thought it were appropriate.

These are questions which need to be the subject of thorough investigation and consideration. Given the volatile nature of the position, not just in Libya, but throughout the region, this needs to be carried out rapidly. We all hope that the levels of violence that we have seen in Libya will not be repeated there or elsewhere in the region, but there are signs of unrest in other countries in the area. British nationals working and living in the region need to be confident that their Government and their country have both the capacity and the will to assist them, including bringing them home safely should the need to do so arise.

Finally, will the Leader give a commitment to this House that when these inquiries and considerations are completed, he will come back to your Lordships' House to report on both the findings and the lessons learnt for the future?

5.55 pm

Lord Strathclyde: My Lords, I thank the noble Baroness for her response, and I am largely in agreement with much of what she said. I will try to answer the questions that she raised, and I will write to her about those that I do not manage to deal with this afternoon. I thank her for the tribute that she gave to the Armed Forces and others who have worked immensely hard during these difficult few days, including those in the FCO.

The safety of UK citizens is paramount to the Government, as the noble Baroness would expect. She asked specifically, since the embassy has closed, about the steps that we are taking to keep in touch with those who are in the country. We are working hard to keep in touch with them, and we are reviewing various options to assist those who wish to leave. However, as the noble Baroness herself pointed out quite rightly, it would be inappropriate for me to speculate on what those options might be or to go into the detail of

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potential operations. Technology certainly exists in a number of ways for British nationals in Libya to contact the Government. There are phone lines that are manned 24 hours a day, 7 days a week. There is, of course, Skype, and there is an efficient tweeting system to send information out to people who would like to be kept informed.

The noble Baroness raised the issue of the Security Council resolution. I agree with her that this was an extremely important resolution, one which I believe will make a substantial difference. She asked whether the asset freeze goes far enough and whether we would seek to extend it. The answer to that is yes; if we felt that it was necessary to do so, then we would. It is very important that this asset freeze is seen to be as effective as possible so as to maximise the pressure on the leadership in Libya, who need to understand that the rest of the civilised world will not put up with the kind of internal violence that we have seen over the past few days.

I very much welcome the visit of my right honourable friend the Secretary of State for International Development, who hopes to visit the area later on this week. Of course we will report back to Parliament on his visit.

The displaced migrant workers leaving Libya and seeking to find their own way home are another important issue. I know that the department is well aware of it and that substantial groups of officials are at the border posts offering advice to try to get them home.

The noble Baroness asked about the significance of the wider issues. Nobody seeing this extraordinary, rapid development throughout north Africa over the past few weeks can fail to be amazed at the speed and the comprehensive nature of the changes taking place. Of course we need to have a strategic response, and we need a response at almost every level, as the noble Baroness pointed out, including with elements of civil society in these countries. I am glad to say that we have made wide-ranging contacts with civil society. We have always had them to some extent, and rightly so. The Foreign Secretary met some of these contacts on his recent visit to the region earlier this month, as well as meeting British Council colleagues who play such an important part in all of this.

We also look to other countries and other multinational bodies to exert influence and pressure on what remains of the Libyan Government. We should leave no stone unturned in making the Libyan Government understand that the best way forward for them is to leave office and to hand it over as peacefully as possible.

The noble Baroness finished with one or two comments about the role of the Foreign Office. Having looked at what has been done, I do not share the view that the Foreign Office should have done very much more very much more quickly. The Foreign and Commonwealth Office has long been a member of the Non-combatant Evacuations Operations-a planning group which is run by the MoD and the structure that led the joint planning for the mixed evacuation in Libya. Every crisis is different. Libya is different from Egypt and both are different from the 2006 evacuation from Lebanon. The NEO model is a flexible response to that reality.

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We put a consular rapid deployment team into Tripoli on Tuesday, 22 February to assist with the evacuation. We also deployed five rapid deployment teams totalling nearly 30 extra staff from the FCO. Those are the people who have done such a magnificent job in getting British nationals on planes in the horrific and dangerous circumstances at the airport. The Australian team arrived on Friday and the Canadians on Tuesday from Egypt. In any action of this kind-in any mission that comes out of nowhere-there are always lessons to be learnt. There will be a review and we will have to learn whatever lessons there are. But I am confident that the FCO reacted quickly and was prepared for this. One of the signs of that was the relative success of the operation that took place.

6.02 pm

Baroness Falkner of Margravine: My Lords, from these Benches, I share in the tributes that have been paid to our Diplomatic Service and armed services in helping to evacuate our citizens. Several noble Lords want to speak and I will be brief.

I congratulate the Prime Minister on securing Resolution 1970 through the Security Council. Do the Government see it in the context of the broader responsibility to protect? I speak specifically about the sentiments in the Statement about the no-fly zone. Will my noble friend reassure us that preparations are advancing? We know from the barbarous nature of this regime that we may well have to intervene on the responsibility to protect to take those minimal measures implied in a no-fly zone. I wonder whether we will be prepared to do that as part of a framework outside of the UN Security Council if we are not able to achieve agreement there.

On the broader sentiments on democracy, this is such a significant Statement from a UK Government: I do not believe that I have seen one in my 25 years of trying to think about democracy in the Middle East. Will my noble friend reassure us that with the Westminster Foundation for Democracy and through all the other work that the Government will do with civil society institutions they will bear in mind that women in the Middle East, as elsewhere, comprise the majority of the citizens of that region? They have for far too long not had a voice in the governance of the region. Will this Government be steadfast in ensuring that women's voices are heard in the reform process going forward?

Lord Strathclyde: My Lords, I thank my noble friend for her comments. On the no-fly zone, there are no details at present and there will not be until we have had discussions with various allies about the feasibility and speed with which it can be put up and about compliance with other international organisations to make sure that everything we do is entirely legal. But the preparations continue, and it is important that they should.

On the organisations that support democracy such as the Westminster Foundation for Democracy, I can confirm that in the current year the budget has been increased. There is nothing I can possibly add to what my noble friend said about the importance of women in politics, particularly in some of these countries. It is self-evidently true.

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Lord Lloyd of Berwick: My Lords, the Leader of the House referred to the Government having revoked Colonel Gaddafi's immunity as head of state. Can he tell us a little more about how that has been done? Will the revocation operate retrospectively and have any other Governments taken the same step? It sounds like a sound step if it can be done and perhaps other Governments should be encouraged to do the same.

Lord Strathclyde: My Lords, it has been done. I gather that it is a matter of state action that any Government can choose to take and the Government have so chosen. I understand that other countries have done something similar, but I cannot name which ones. As for the action being retrospective, I am not sure that it is important that it should be retrospective, but the noble and learned Lord may have been making a clever legal point that at the moment I have missed.

Lord Lloyd of Berwick: No.

Lord Strathclyde: I am glad to hear that the noble and learned Lord say no.

Again, it is part of putting pressure on the regime and senior supporters of the regime including looking at the role of the International Criminal Court. It should complete its investigations so that we can bring this truly appalling situation to an end as quickly as possible.

Baroness Liddell of Coatdyke: My Lords, I am grateful to the noble Lord for repeating the Statement from the Prime Minister and I am glad that the opportunity will be taken to learn lessons from the procedures, particularly around the evacuation. If one contrasts the evacuation from Libya with the evacuation just a couple of years ago from Lebanon, it was at a much slower pace. However, I have a much more mundane, long-term question. For the courageous young people that we have seen throughout the region to reach their aspirations, there will have to be a sound economy throughout that region. With the turbulence surrounding events of the past couple of weeks, we have seen oil prices rising to $120 a barrel. That has a direct impact on this economy and on the fragile economies of the developing world.

I am aware that the structures exist to bring together oil producers and consumers both within and outwith OPEC to discuss the operation of oil markets. Will the Leader of the House indicate whether there has been an opportunity to begin those discussions? If we do not secure stability in oil markets in the Middle East, many of these courageous young people will experience continuing poverty, and such poverty of aspiration is what brought them onto the streets in the first place.

Lord Strathclyde: My Lords, the noble Baroness did not ask a mundane question. It is a crucial one and goes to the heart of how the situation will develop possibly over the next few months but certainly over the course of the next few years. The key is about the economy in these countries. As the noble Baroness pointed out, a lot of that is dependent on the price of oil and how it is managed. The second part of her

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question was about the role of young people, the proportion of whom as a population appears to be far greater in some of these countries than in Europe.

To the specific question on whether discussions are ongoing with oil producers, particularly OPEC, the answer is yes, and they will continue. There are no easy answers to what the noble Baroness called her mundane question, but we are very much aware of them. The decisions, depending on how events pan out over the next few weeks, will have a great bearing on the success of the north African economy over the next few years.

Baroness Morris of Bolton: I thank my noble friend for repeating the Statement. I am delighted that the Prime Minister visited Tahrir Square and leaders of the opposition in Egypt last week. While it is absolutely right that the peoples of the Middle East should determine their own futures, we have a lot to offer in institution-building and in developing the concept of stable and effective opposition. I am delighted that my noble friend said that the Westminster Foundation for Democracy will receive funding and that the British Council and others will be encouraged to work with civil society. However, there are a number of opposition leaders in Arab countries who have not had the luxury of being able to travel here and who would like to come to visit different political parties and institutions. Will my noble friend do all that he can to facilitate that as quickly as possible? That has to be in all of our interests.

Lord Strathclyde: My Lords, I agree with my noble friend Lady Morris. She is right when she talks about institution-building and the role that we can play. That includes looking at the experience post-1989 and the building of democracy in central and eastern Europe. Bodies such as the Westminster Foundation for Democracy play a very important part. As I said in response to the noble Baroness, Lady Liddell, it is partly about building these institutions and partly about rebuilding their economies. The two very often go hand in hand, and we should be looking at the two in making sure that we can bring all of this to a successful conclusion.

Lord Maginnis of Drumglass: My Lords, I thank the noble Lord for bringing the Statement to the House. I congratulate the Government and our security services on how they have worked effectively together so that this operation has been completed without casualties. I suggest that perhaps the Government would do well to look at their relationship with the press, who appear to have been pre-emptive and working on a minimal amount of information when they evoked the initial criticism of the operation.

It is important that civilian firms employing British civilians overseas keep a proper record of who they employ and where they are employed. If they already do so, was that information available as quickly as it should have been to the Government? I should be grateful if the Minister could answer those two questions. Lastly, this House should and does acknowledge the gratitude due to our Turkish friends and allies, who have once again stepped into the breach to support us at this difficult time.

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Lord Strathclyde: My Lords, perhaps I may say how grateful we are for Turkish help in this developing crisis. They have now taken over the role of representing the United Kingdom in Libya. I thank the noble Lord, Lord Maginnis, for what he said about the role of the Armed Forces, the Government, and the security services, in this instance. I will not entirely follow him down the route of overly criticising the press, but it is certainly true, in planning these operations, that they are delicate, they need to be kept secret, there are enormously important elements of security, and our very free and open society is open to everyone, including Libyan armed forces. I hope that, over time, people will look back and see this process as having been rather more successful than was perhaps perceived at the end of last week.

The noble Lord asked a totally reasonable question about the amount of information that was made available on the whereabouts of individual employees. We are dealing with an area in the desert which is something like four times the size of the United Kingdom and I understand that some of the information we received was not as good as we would have wanted. No doubt that is one of the lessons we shall all learn.

Lord Gilbert: My Lords, will the Government make sure that any no-fly zone encompasses both rotary-wing and fixed-wing aircraft? This is a very obvious thing which has been overlooked occasionally in the past. I have confidence that Her Majesty's Government have been canvassing friendly countries as to who would wish to join in the enforcement of any no-fly zone. Can the noble Lord tell us how many positive answers he has had-I am not asking him to identify the individual countries-and have those answers come from states that are actually in a position to contribute to the enforcement of a no-fly zone, particularly with respect to possession of the right sort of air assets, attitudes, and all the other ingredients that are necessary to take part in that sort of activity?

Lord Strathclyde: My Lords, the noble Lord is entirely right, and he should not shrink from stating the obvious, that we should look carefully at whether a no-fly zone should ban both rotary-wing and fixed-wing aircraft. The rest of his questions are entirely fair, but I am not able to help him with them at the moment. Work is ongoing with allies and other multinational organisations to see how a no-fly zone could be best put into effect and policed. Only when the Government have that information available will we be able to make it public.

Baroness Hussein-Ece: My Lords, I thank the Leader of the House very much. This Statement will go a long way and will be welcomed by the many brave people we have seen on our television screens and read about, who are demonstrating and fighting for democracy and for their freedom. I think it is going to improve the reputation of this country tremendously in those places. I should like to ask two questions. First, specifically about the British nationals who are still scattered and missing, or who have not been located, in the oilfields in the desert, what contribution has been made by the oil companies that they work for to help to locate

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these people and to evacuate their own workers to safety? Presumably they have resources at their disposal to help that effort. Secondly, although I welcome my noble friend's comments and those of the Prime Minister about the outdated notion that democracy has no place in the Arab world, which has clearly been demonstrated now to have been a myth, what lessons have been learnt specifically regarding previous policies and the previous Government's policies in arming and cosying up to dictators who oppress their own people?

Lord Strathclyde: My Lords, I agree with my noble friend on the cause, which we have seen on our television screens, of people fighting for freedom and for democracy, but most of all for choice and for change and to remove these old regimes that have oppressed their people for so long. On the first question on UK nationals, I mentioned to the noble Lord, Lord Maginnis, some of the role undertaken by UK companies. Generally speaking, there has been a lot of support from UK companies in helping the Government to trace the employees, so that has on the whole been a reasonably good story.

As to the second question about cosying up to dictators, of course I agree with my noble friend. However, successive British Governments cannot always pick and choose the kind of Governments that countries have chosen for themselves or have had imposed on them. At different times, different Governments will work in different ways with all sorts of people, some of whom are deeply unsavoury.

Lord Craig of Radley: My Lords, I thank the Minister for repeating the Statement. He has rightly acknowledged the considerable contribution of the Armed Forces in this, and it is a great regret to me that they were not brought in earlier, as happened with the French and German air forces, which arrived in Tripoli at the beginning of last week.

Bearing in mind that some of the assets used on this occasion are about to be scrapped and that others have already gone that could be used on similar occasions, has not the time come for the Government to consider some quantitative easing of the defence budget?

Lord Strathclyde: My Lords, I understand exactly why the noble and gallant Lord has asked the question, and the way in which he did so. We believe that, even with the strains on the MoD budget, we still have the capability to carry out the evacuation process that has been carried out over the past few days.

Lord Davies of Coity: My Lords, I, too, express appreciation for the Statement made by the Leader of the House, repeating what the Prime Minister said. I am also pleased with the evacuation measures that have been taken. However, early on in this crisis, millions of British people saw the Foreign Secretary on the television saying that Colonel Gaddafi, the tyrant of this issue, was in Venezuela. Have the Government made any assessment of the impact that that incorrect statement has had on the British public?

Lord Strathclyde: No, my Lords, and I think that it would be impossible to do so.

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Lord Marlesford: My Lords, does my noble friend agree that the defection of senior Libyan diplomats from around the world may prove to have been a significant component in the removal of Gaddafi? Furthermore, in the context of the withdrawal of the British diplomatic mission from Tripoli, is there any news on what is happening to the Libyan embassy in London?

Lord Strathclyde: No, my Lords, there is no news on the embassy in London. But my noble friend is right that the defection of senior Libyan diplomats, particularly at the United Nations, was a signal to many others that this regime had come to an end. That is part of the combined exerted pressure that we wish to see to encourage more defections and bring this regime to an end as quickly as possible.

Public Bodies Bill [HL]

Committee (7th Day) (Continued)

6.23 pm

Amendment 48 not moved.

Amendment 49

Moved by Baroness Royall of Blaisdon

49: Schedule 1, page 17, leave out lines 15 to 22

Baroness Royall of Blaisdon: My Lords, it is clear from the amendment that these Benches seek to remove RDAs from Schedule 1, which legally enables their abolition. This debate on the chaotic and misguided abolition of RDAs announced by ministerial fiat comes at a time when there is clear evidence that economic growth has flat-lined and that the economic recovery has ground to a halt. Now, more than ever, we need the regions to be motors of economic growth in our country, instead of which the RDAs, which provide the architecture for regional economic development, are being dismantled.

As we have heard at Second Reading and throughout this Committee stage, the Conservative-led Government have failed to follow a satisfactory process or procedure for evaluating the efficiency and effectiveness of the bodies scheduled for abolition. The rushed decision-making and lack of consultation is nowhere more blatantly obvious than with the abolition of the RDAs. The White Paper outlining the Government's plans came after the decision to abolish RDAs had been announced, and it was a real surprise to these Benches to see their inclusion in Schedule 1. The House of Commons Public Administration Committee concluded that the Government did not consult properly on their proposals. It welcomed the Government's agreement to allow for further consultations and said that it expected,

What consultations have taken place since the abolition of RDAs was announced, and how have the conclusions of those consultations been taken into account?

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Even if the Government did not make a proper assessment of the value of RDAs, an independent evaluation by PwC found that since their inception RDAs helped to create thousands and thousands of jobs, well in excess of their target; assisted nearly 57,000 businesses-again, well in excess of their target; enabled £5.7 billion of funding to be levered in from the public and private sectors; and created over 8,500 new businesses. The evaluation also demonstrated that every pound spent by RDAs added approximately £4.50 to the regional economy. Other strengths of the RDA model include the ability to pursue a coherent vision for the region that could be turned into a strategy for economic development and investment.

So why are RDAs being dismantled with no credible alternatives? I am sure that the Minister will tell me that they are being replaced by local economic partnerships, which will see business and civic leaders work together to bring economic development, shifting power away from central government towards local communities, which really understand the barriers to growth. But it is not the case that all the RDAs are being localised. Some functions, such as inward investment, innovation, key sector development and response to economic shocks are going to be transferred to the national level. Inward investment is one of the real big successes of RDAs, offering one-stop shops in a region, with fantastic results-for example, Toyota in Derby or Nissan in the north-east. So how does centralising such a function square with the much-vaunted localism agenda? Are the Government really committed to devolving powers and functions when there is clear evidence that they are currently being well managed at regional level? I am more than a little confused about the role of regional government offices, and would be grateful if the Minister could help me. Is it true that Mr Cable is reversing elements of Mr Pickles's Maoist revolution by rebuilding parts of the regional infrastructure that were scrapped last summer? I very much hope that six regional government offices are being reinstated and that that will foreshadow other changes in regional policy.

I think that it will be clear from debates later this afternoon that some RDAs are more effective than others and that there are weaknesses as well as great strengths, but just because reform or change is necessary in some areas, why take the radical step of abolition, especially when it is apparent that the LEPs will not be able to provide the same impetus for regional development as the RDAs? In many areas of the country, there are simply no local economic partnerships; I think especially of my own region of the south-west. Could the Minister update us on how many LEPs have been approved and where the gaps are? How are the gaps going to be filled? It would be, or should be, unthinkable at any time, but especially when economic growth must be the means to kick-start and sustain recovery, that any part of the country should be without proper regional development.

There are many grey areas relating to funding. Can the Minister confirm that it could cost as much as £1.4 billion to wind down RDAs and complete existing programmes? Could he also confirm that funding from the regional growth fund will amount to £1.4 billion

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over three years, and that that is nowhere near the sum given to RDAs? If that is true, the money available is not adequate, and it suggests that the Government do not take regional growth seriously enough. I also wonder why the Government are approving only projects based on short-term job creation for the first £250 million of funding from the regional growth fund. Job creation is critical, of course, but what about strategic, long-term projects, which are essential for the economic well-being of any region? I would suggest that, by focusing on short-term job creation, the Government are being short-sighted, neglecting the potential for long-term economic growth as well as jobs.

6.30 pm

Then there is the question of land and property assets that are currently owned by the RDAs. Given the significant value of many of these assets and their role in future growth and development, I wonder what the Government are proposing to do with them. I would be grateful for reassurance from the Minister that they will not be disposed of in a fire sale, with little regard for the regional and strategic importance of many of the sites held. These assets should be retained and used locally to drive economic growth and recovery.

Many of the successes associated with RDAs are a consequence of the expertise and experience of the staff who have played a pivotal role in the agencies. I am concerned about the staff themselves, but also about the body of knowledge they have built up. What are the Government doing to minimise the number of redundancies which will occur with the abolition of RDAs? How will they ensure that the knowledge, skills, experience and expertise are not going to be lost?

My final question relates to funding from the European Regional Development Fund. Will the Minister confirm that the Government intend to centralise the delivery of ERDF funding into the DCLG? If so, it would appear that LEPs will be excluded and that the management of the funds will no longer have local and regional input, leadership and direction, with the risk that it will fail to reflect the priorities of the regions. Will he also confirm that the European Commission has expressed concern about the changes caused by the abolition of RDAs, and say whether the £1.5 billion of funding is at risk?

It appears that by dismantling RDAs, the Government are creating uncertainty and failing to support strong and credible organisations to replace them. At present, LEPs simply do not have the powers or resources to drive jobs or growth in our regions. It is widely recognised that LEP funding will not be guaranteed, and that they will certainly not have any start-up or core funding. The regional growth fund has already been oversubscribed in its first round, meaning that many strong bids that have already attracted private sector support look set to miss out because the Government are not prepared to invest in private sector growth. This does not bode well for regional growth and development, and I would urge the Government to think again-to reconsider the fine record of RDAs and the huge contribution they have made to the regions and the country as a whole. I beg to move.

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Lord Beecham: My Lords, in the coalition lexicon, there is a six-letter word missing: it is the word "region". It has been banished by Mr Pickles, and the use of it has been banished from PCTs by the Department of Health. Of course it is true, as my noble friend Lady Royall has implied, that there is a variable geometry about regions. They are not all the same: some are regarded as too big-one thinks perhaps of the south-east, where a predecessor television programme to "Strictly Come Dancing" was called "Come Dancing". Some of your Lordships may recall that then "Home Counties North" and "Home Counties South" were regarded as appropriate areas. Perhaps that might have been better than a single RDA for the south-east. Nevertheless, many of the RDAs have performed extremely well. If there were uncertainty about some of them, the question arises: why abolish all when there may be a very strong case for keeping some, if not all?

Nearly a year ago, Vincent Cable came to the north-east in his first few weeks as Secretary of State, and he declared his belief that the north-east was,

He was right about that, but he subsequently went on to propose the abolition of that agency. In any case, he understates the case.

Consider the report on the RDAs from the Select Committee on Business, Innovation and Skills. It found evidence of effective intervention in the face of economic shocks and strongly endorsed the RDAs' role because they,

It thought that some RDAs were, perhaps, too big to profit from local engagement, but it made it clear that,

Interestingly, the CBI recorded 66 per cent support for continuing regional co-ordination via the LEPs, if they were to be the new mechanism-and especially strong support in the Midlands and the north. Even in areas where the number of local enterprise partnerships was great, it saw the need for an overarching structure. The Select Committee recommended that regional groupings should be recognised where a clear wish was expressed. It also expressed a concern that inward investment and tackling economic shocks would be inadequate without local knowledge and support, as my noble friend has said, when functions were translated to Whitehall. This has been compounded by the proposed abolition of Government Offices for the Regions providing critical intelligence and contact from within the regions to government. Accordingly, the Select Committee recommended that government should devolve powers to regional structures where there was clear evidence of good management of resources.

A back-handed compliment was paid to the Government's policy from one witness to the Select Committee, who said:

"One good thing that the Westminster Government has done is to abolish regional development agencies in England",

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removing significant competition from the market. That witness was Dr Brian Gibbons, who is Minister for Economic Development in the Welsh Assembly. He clearly took the view-indeed he expressed it-that the Government's decision presented Wales with a significant opportunity at the expense of the English regions.

The Federation of Small Businesses said that the local enterprise partnerships should have the capacity to address all the issues impacting on development, including transport, planning and housing at a strategic level, tourism, the low carbon agenda and skills and training. But that long list begs the question of the scale of the organisation to carry out those functions and the resources it will need. The organisations that will take the place of the RDAs are the local enterprise partnerships and, as my noble friend has said, they will not have responsibility for significant areas of policy including the ERDF. They will be expected to work with government, whatever that is supposed to mean, on investment priorities, transport infrastructure, the regional growth funds and getting the jobless back to work. Again, there is the question of scale: you will have, as we have in the north-east, at least two organisations, perhaps with an overarching body as well. In other parts of the country there are none, in some there are numerous: how will these work together at the strategic level as opposed to the very local level?

Of course, as my noble friend has pointed out, the funding is very limited: £1.4 billion over three years is very little more than what the Secretary of State himself described as the "trifling" figure-I think that was the word-of £1 billion that was originally proposed. The committee was also concerned about the not-so-local knowledge, about the assets and about the potential for a massive success or failure if the debts were not adequately resourced. Of course, they are not being resourced: they will have no funding and no powers. As I have said previously in this Chamber, they are in danger of being penniless, powerless and pointless. That is a real risk.

There are serious questions to be asked about assets. The Government's plan is for the assets to be used to pursue economic development benefits through transferring assets to appropriate hosts. They qualify that promise, which on the face of it looks reasonable, by reference to the need to deliver maximum value on public sector investment in the context of deficit reduction. There is therefore a clear implication that the assets will be realised to meet that agenda. There is also a clear implication that that might lead to early disposal.

I have not had the advantage of reading the entire text because Wikipedia has not yet published it. I have seen only a redacted copy of the submission made by One North East, the agency with which I am most familiar, on the proposal for assets disposal. Interestingly, it is proposed to sell some at market value to local authorities. How local authorities are supposed to fund the acquisition of those assets in the present circumstances is beyond me. Some will eventually be put on the market for open market disposal, with an interim period of management by local authorities. Again, at a time of local authority cuts, where will the capacity exist to manage this estate? Similar difficulties

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arise in relation to intellectual property. There are no fewer than seven pages on that in the submission, including an interestingly little-known scheme called JEREMIE, which is spelt somewhat differently from the convention. It is to do with finance for business and has been extremely successful in the north-east.

What we have here is really an irony. This Government, above all, look to the private sector to lead and to make good the deficiencies in the economy. The RDAs, which they are about to abolish, are heavily engaged with the private sector. They are private-sector-led bodies, and yet they apparently cannot be trusted with economic development in the regions.

The proposals in the Bill bear all the hallmarks of a rush to misjudgment, like so many of the measures that the Government have brought forward. We have seen examples this very day of second thoughts having occurred. I hope that the Government will listen to their natural supporters, if you will, in the private sector, in business and across parties in parts of the country; and will pause, reflect and reconsider proposals that threaten to damage the economic recovery that is essential but seriously at risk in many regions.

Lord Shipley: My Lords, for much of the period since the Second World War-and indeed before-Governments have pursued some form of English regional policy. There have been several initiatives: regional Ministers in some or all regions; development corporations; development companies; and a variety of government office structures, so that Whitehall could be represented properly across all parts of England. Policies have been chopped and changed, but they have been clarified in recent years-first by the creation of the development agencies in the English regions, and secondly by the strengthening of government offices so that all Whitehall departments were housed in a single government office. The system was far from perfect and led to some unnecessary bureaucracy. There was a lack of democratic accountability within the regions. However, the system had one overriding virtue; it was regionally based and gave a clear and firm focus for each region in England that had previously been lacking.

Some regions did not like the structure because they did not feel that their region really existed as an entity. The south-east is the most obvious example. Others, such as parts of the south-west, felt distant from their RDA and government office. Perhaps it was a mistake by the previous Government to create an RDA in each region. Indeed, it is hard to see, in terms of strategic regeneration, why the south-east needed a development agency at all. However, that is history. What is not history is the decision to abolish all English RDAs.

In the north, people have identified with their RDA to a much greater extent than in the south. Maybe this is a function of the northern regions being further from London and the levers of power. It also reflects the greater needs of those regions, which require government intervention for the ultimate benefit of the UK as a whole. The decision to abolish the RDAs and government offices in the south-east may have been broadly popular but it is most certainly not a popular decision in my own region-the north-east. I

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declare my interest as a board member of One North East since 2005. There is a constitutional issue here, too. Why do Scotland, Wales, Northern Ireland and London have substantial devolved powers, some of which are set to increase, at the very same time that the English regions are being further centralised within London-based structures?

6.45 pm

The accusations against the RDAs were that they wasted money, competed with each other in, for example, tourism and inward investment, and had bloated staffing establishments with expenses systems that were open to abuse. Like all generalisations, such conclusions are exceedingly dangerous. The vast majority did not run bloated staffing structures or see abuse of expenses systems. Most did not compete directly with other RDAs, and all were subject to audit by the National Audit Office. All worked with the single purpose of generating economic growth in their regions. All can point to success stories that would not have been achieved without an RDA. We are now in a position where Scotland, Wales, Northern Ireland and London can spend money on tourism, for example, but the English regions with which they compete cannot. This cannot be right.

My noble friend Lord Beecham reminded us that the Business Secretary admitted publicly a few months ago that the process of abolishing the RDAs had been a bit "Maoist". I agree with him. It was done without any attempt to evaluate the sustainable achievements of each RDA and whether they had delivered value for money in long-term jobs growth. The decision-making on RDAs fell foul of the unhelpful fact that the DCLG had been funding the lion's share of RDAs, with BIS being very much the minority financial partner, even though BIS was the responsible Whitehall department. This has added to the confusion over who was responsible for what.

Can further sustainable jobs be delivered without an RDA structure in England? Can redistribution to the poorer regions and those more dependent on the public sector be achieved, too? While the creation of a regional growth fund, which has £1.4 billion to commit over three years, is designed to do just that, it has less to spend than the RDAs had. I declare an interest again as a member of the growth fund's advisory board. When account is taken of the new likely geographical spend and the fund's clear remit to generate sustainable private sector jobs, it will certainly be able to make a difference. I welcome that. However, it cannot be the whole story. At the heart of the matter lies this constitutional issue. I do not feel that sufficient thought is currently being given to English regional policy. Simply abolishing our RDAs where they proved valuable, making little attempt to save the good things they have achieved, is a mistake.

Not surprisingly, we now find that some Whitehall departments are deciding that they must continue to employ staff outside London. I understand that some 20 per cent of One North East's staff will now continue working in the north-east for Whitehall departments. However, they will be split up to work in departmental silos-so much for joined-up working. We cannot run everything in England from Whitehall. I thought we

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had learnt that lesson many years ago. No doubt local enterprise partnerships will give a focus to regeneration, but since they cover all of England they do not have a responsibility for assisting the weaker local economies, and neither do they have any central government money.

In practice, this is the last operational year for our RDAs. The Government should have paused for thought for longer than they did before deciding to cull them. The process that has been followed, and the absence of any clear regional structural policy behind it, is a matter of serious regret, from which I hope we can yet learn.

Baroness Armstrong of Hill Top: My Lords, I follow my noble friends Lord Beecham and Lord Shipley. Newcastle has spoken from both sides of the House today. I see that the noble Lord, Lord Bates, is waiting to represent the southern part of our region. I very much represent the middle of the region but also, I hope, the region as a whole. The north-east is a region and feels itself to be a region. It has a sense of identity and believes, partly because it is so near Scotland, that it has to fight both to maintain that identity-of which we are very proud-and to make the best of the enormous talent that is in the region.

Much government policy over the past 40 years has recognised that there is talent there and that the north-east laid the bedrock for much of the development of this country. If you think about the Industrial Revolution and the contribution that the north-east made then and in subsequent years to the growth of the economy across the nation, it was very important. As those prime industries began to decline, a regional voice, and action supported by central government, were seen as important to begin to rebuild. This case was being made very loudly before I became a Member of the other House. Indeed, when I did become a Member of the other House, my then neighbour and now my noble friend Lord Radice proposed a Private Member's Bill, which several of us supported, to enable the north-east to have a regional body that would take strategic decisions with government support. Of course, that was in the era of the Government run by the noble Baroness, Lady Thatcher, so the Government of the day saw the point and the need, and they responded, eventually, to the efforts made by my noble friend and others across the board.

The north-east is parochial, but it is not sectarian. We do not want to get into a situation in which one group fights another within the region for whatever scraps are around. We have always accepted the importance of trying to build the private sector because it is true that at the moment we have too many public sector jobs. Even though we increased the number of private sector jobs in recent years, it was by no means sufficient. That is still a huge job to be done in the north-east, but now we are losing the strategic means of doing it. I just ask the Government to think again.

I accept that there have to be cutbacks in public spending, but it frightens me to see how much money the RDA is having to spend on redundancy and run-down costs when that money ought to be put into economic development. The rise in unemployment, particularly among young people, is frightening. My generation will regret that for many years to come, because we thought we had got through it. We thought that we

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had got to the stage where we could promise young people in the north-east prospects and opportunities, and that is beginning to fall off the edge again. They see redundancy payments and the struggle to get rid of assets when they know that doing so at this time will not bring in the return that we should be getting from those assets. This is the moment for the Government to think again about the north-east.

The reaction to the Government's announcement on 23 June was bewilderment, particularly, as my noble friend Lord Beecham said, after the Secretary of State for Business, Vince Cable, said on 3 June that, having looked at things, he was convinced of the need for one body across the north-east. It was therefore with bewilderment that the private sector, the regional chamber of commerce and the regional CBI faced the prospect of months of, quite honestly, squabbling again about what the LEPs should look like, how they should be formed and all that, when the key issues of the day were actually slipping out of anyone's responsibility.

It was irresponsible of the Government to appoint a new chair of the RDA on 3 June, and then, on 23 June, to say that the organisation was being abolished. One of the key businessmen of the region was being put in place to manage redundancies. It is nonsense. He should be managing inward investment; he should be managing what possibly can be done with the manner in which the assets have been developed in the north-east, with partners, to draw the best strategic opportunities for the region. Instead, he is managing decline, which is a tragedy. There is no one who does not accept that the Government will have to put in less money this year, although they did with regard to One North East, and I hope that they recognise that from what my noble friend Lord Shipley has said. I acknowledge, welcome and am thankful for his contribution both to the RDA and to the new body. However, the new body-the national body-will not have particular reserves for the north-east. It will accept whatever bid comes from wherever. Therefore we might do more to unbalance the economy in this country rather than address the need to rebalance the economy in this country.

One North East was, according to all the independent audits, very successful in the number of jobs that it created, the number of new businesses that it supported and the number of people it helped to get into employment. I will talk about that in more detail at a later stage. The north-east has had a successful RDA. No one says that it achieved everything that we had ambition for it to achieve, but it is one region in England in which we know that progress was being made, and we know that it makes sense to have a strategic body across the region. We are, after all, a very small region, the smallest in the country. Its success was therefore dependent on being able to be strategic across the region. It had a plan for green jobs; it had been developing green policies in recent years. I know very well, from companies that I have talked to, the work that One North East was able to do in pulling together that strategy and in making sure that one company worked with another in a way that developed each of their interests while working in a more coherent and strategic way across businesses.

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As a result, Romag, the glass company, was able to support the development of more charge points for electric cars and to support the electric car makers in where they would be and how they would develop their business in a network of hubs around the country. All these ideas came out of the initiative of One North East. I hope that the Minister will take the opportunity to talk to Nissan about its support for One North East and how important it thinks it has been in its continued presence in the region and its ability to get the parent company to continue to invest in that factory in the north-east, which is, as we know, the most productive car factory across Europe, if not the world.

It is very difficult to talk without emotion about the north-east, a region that means so much to so many of us and to try to get the Government to think again. This does not mean, "You've got to put more money in", but that the money that is going in has to be used in the most strategic way and must not be fragmented. It should not be used in a way that does not maintain the consensus with business, trade unions and local authorities that we have had across the region for many a long month and year. The Government are breaking that consensus, which is incredibly dangerous. I ask them to think again.

7 pm

Lord Ramsbotham: I declare an interest: my son is the chairman of the North East Chamber of Commerce, which the noble Baroness mentioned. I endorse everything that has been said by the noble Lords, Lord Beecham and Lord Shipley, and by the noble Baroness, Lady Armstrong. Politically, people think of the north-east as being divided by rivers. Economically, the north-east is divided between the rivers. Now, instead of having one regional development agency, which has been looking over the whole of that area and easing that division, the Government are setting up local enterprise partnerships that are separating the region. It seems to be madness. All that I can say, from the points of view that I have heard from everyone, is that there was not just confusion but anger up there after Mr Cable made his announcement. Having observed the situation, the Government seemed to be prepared to listen to what people up there were saying and proving, but suddenly that was all dashed, apparently in alliance with a mantra that everything should be localised.

If there is one issue that should be borne in mind, it is communications. The communications system in the north-east is not all that good. There are not the motorways or the means of connecting the various areas. Why not? It is because, over the years, there has been all this local scrapping. Yes, bypasses have been built around areas and there have been local communications, but the region was never looked at as a whole until there was an RDA. Until and unless you get the region to be looked at properly, you will not get the communications that should be the hub of any future development. I join everyone who is begging that the north-east be, if necessary, taken as a separate area and looked at separately again, in order not to throw away what has happened.

Lord Bates: My Lords, in many ways, this debate reflects the sense of where we are with the whole Bill, because we have heard speech after speech about the

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north-east of England, which we all love dearly, pointing out what an exceptional region it is and how it needs special attention and help. People have been saying that it had a regional development agency that performed better than any other and was adhered to and held in affection by the business community of the region. It is a small region, with 2.6 million people. The Northwest Regional Development Agency, on the other hand, covers an area from the Scottish border to Cheshire. That is not a homogeneous region to which people can feel an affinity.

There are different views on this. We are having this debate, but let us remember that there is an option available to the local authorities and the business community of the north-east to have a single local enterprise partnership for the whole of the region. That offer was put forward and I supported it, so that there should be one voice for the north-east. However, the local authorities, in their wisdom, could not agree on that. We therefore have this breakaway on Teesside. In fairness to Teesside, and given my credentials in the north-east that I offer to this debate-I was born on Tyneside, represented a seat on Teesside and now live on Wearside-I understand what the noble Lord, Lord Ramsbotham, said about the region between the rivers. There are different perspectives. The people on Teesside felt strongly at the last general election that they had been let down by the regional development agency. The closure of Corus TCP was a real issue. The people felt that they wanted to reflect the fact that the economy and the process industry of the Tees valley made up a unique and discrete entity and that they might perform better on their own. I disagreed with them, but they took that decision, which was for them to take. It was on offer.

Perhaps I may offer this point of view. As well as the sort of romance that we have heard about One North East, let us remember-I am sure that my noble friend Lord Shipley from the board can confirm this-that its budget two years ago was £290 million. Under the previous Government, that was to be cut this year to £180 million. The idea that there was some sort of love-in and that somehow money was being poured into the good north-east was not true. A cutting back of the reach of that agency, and some may say its effectiveness, was already in train.

It is also worth putting this on record. Other noble Lords will also remember the time when I was Minister for the north-east under the previous Conservative Government. There were the Northern Development Company and the Teesside and Tyne and Wear development corporations, to which the noble Baroness, Lady Armstrong, referred. The development corporation for the north-east was fantastic and very well run under John Bridge, with George Russell as chairman-Ron Dearing was a previous chairman. These were terrific ambassadors for the region. They brought in significant amounts of foreign direct investment; 75,000 jobs were brought into the region during their time, although their organisation was very thin. They did phenomenal work. Our reward for having one regional development agency, going head-to-head with the Welsh Development Agency and Scottish Enterprise in trying to bid for projects, was that the incoming Labour Government created seven competitors for us in the

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other regional development agencies around the country. That was a mistake. There is a case for north-east exceptionalism in these matters. I should have preferred the continuation of a single entity, but that has not been possible.

In conclusion, we are entering a time when there is a change of approach. An interesting study into regionalism by the Smith Institute looked at a set of data covering a period between the peak before the recession hit and its trough. It showed that a recession born of the financial services industry, which should therefore have primarily impacted on the City of London, in fact hit the regions of the country, such as the north-east, Yorkshire and the north-west, hardest. That seemed to fly in the face of the argument that regionalism would balance the national economy. Regionalism was meant to give a little bit of emphasis and push to those regions that, because they were peripheral to the centre, struggled in economic terms. However, we were actually hit hardest.

The north-east will have a good and positive future, not because of organisations and institutions, but because of the quality of its entrepreneurs and businesses. The entire budget of One North East is only half as much as the amount by which Greggs increased its turnover last year, in terms of investment in the region. The company employs 18,000 people. The private sector is doing it. Companies such as Sage are doing fantastically well. I was at the opening of a new facility for OneX in Teesside, which is now exporting server capacity into Denmark through a new cable across the North Sea. There are some fantastic things happening.

It is worth remembering that the north-east is the only region in the country that exports more than it imports. That is a great place to start, and we have to have far greater confidence in our own ability. A good policy is the introduction for the first time of a difference in national insurance contributions, with a preference for allowing people outside the south-east and London to benefit from lower tax rates. Personally, I would go much further. There is a real case for reintroducing enterprise zones across places such as the north-east. In places such as Blyth, Easington and Middlesbrough, where there is no enterprise at all at present, you could create enterprise zones under which businesses could be set up.

The opportunity was there for us to have a single voice in the north-east, although it was not taken. However, the prospects are good, but only because our entrepreneurs and businessmen are good.

Baroness Whitaker: I rise to speak to Amendment 55, leaving the north-east. The grounds for my amendment, in contrast to the eloquent plea by my noble friend Lady Armstrong, are not that every part of the South East England Development Agency should remain exactly as it is now, but that, at present, without it, there is no adequate support for some of the poorest parts of the south-east. I am thinking in particular of Newhaven, next to where I live, where over a quarter of households earn 60 per cent less than the national median income. Newhaven would hugely repay investment. It is poised to become the key commercial port in Sussex and 30 per cent of local companies are in the

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manufacturing, construction and building sectors. But its high street is withering away and its residents have little spending power.

The Government have proposed local enterprise partnerships in place of the regional development agencies, as we discussed earlier. But at the moment Lewes district, where Newhaven sits, is covered by an LEP for East Sussex, Kent and Essex. This is hopeless. Newhaven has few links to the east. The travel-to-work area is west towards Brighton, north to Gatwick and Crawley, and, for commuters, north-west to London. Unless Newhaven can go into the Coast to Capital LEP, there is little hope for the prosperity of the hardworking and friendly people who live there.

There are acres of brownfield land designated for industrial and commercial use which will be of little interest to an LEP focused on Hastings, Kent, Essex and the Thames Gateway. But it is all ripe for investment. The town is well placed to provide work for the Brighton area and there are promising signs that land with planning permission for housing will soon be developed. The port owners are actively pursuing regeneration of the port, which again has few synergies with the east and north-east.

You could argue-indeed, it has been argued-that SEEDA is too big and there could be other solutions to the regional investment problem. But the worry is that places such as Newhaven will simply drop out of the loop unless the Government pay more attention to practical realities. I ask the Minister: what in the Government's arrangements for LEPs demonstrates any improvement for Newhaven?

7.15 pm

Lord Greaves: My Lords, we have heard a lot from the north-east during the discussion on these amendments and I want to broaden it a little to the rest of the north of England. I have Amendments 52 and 58 in this group, which refer to the three regions of northern England: the north-east, Yorkshire and the north-west. I speak as a Yorkshireman who lives in the north-west-just-and, in view of what I am going to say, I should remind the Committee that I am a member of Pendle Borough Council.

Here, we are dealing with a government policy based on the view that regions do not really exist in England. I think that that is a metropolitan/south-eastern view of life and does not apply in the north. I believe that regions exist. I certainly believe that the north-east exists but I have to say to the noble Lord, Lord Bates, that most people in the north-west are very clear that they live in the north-west. North-west England may be a boring name; nevertheless, most people in the north-west know perfectly well that they live in the north-west and they have an allegiance to it.

There are boundary problems, but there always are. I live in Pendle, which is on the border with Yorkshire. We have an area called West Craven, which includes the small towns of Barnoldswick and Earby, where everyone believes that they are still in Yorkshire for everything other than administrative purposes. There is always a problem with Cumbria, which in a sense is a mini-region on its own. If Cumbria had been twice

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the size it is, it would always have been a separate region. It has always had to choose whether to be tagged on to the north-east or the north-west. However, that is not to say that in Lancashire, Cheshire, Merseyside and Greater Manchester in particular, and in south Cumbria, people are not very clear that they are in the north-west, and they have an allegiance to it. I do not object to an attempt by the Government-if this is what they have done-to rationalise our regional structures and make them more efficient, more logical and more sensible.

Perhaps I may talk for a minute about regional structures in general in the north-west and about the government office for the north-west. A close member of my family had a job as a permanent temp in the regional office in Manchester for the best part of a year. This was a while back but not that far back. I do not want to breach lots of confidentialities concerning what she did there-she had to sign the Official Secrets Act to work there and she asked me whether it was all right to sign it. However, I think I can mention one thing without having her hauled off to the Tower of London. She said to me, "You know when MPs and people put questions down and ask questions of the Government?". I replied, "Yes", and she said, "Well, if they're about transport, I have to deal with them, find out the answers and send them back to London". I remind noble Lords that she was a temp. I thought about it and asked her what she meant by "and people", but she said, "Please don't, daddy".

The regional offices and the North-West Development Agency were probably overstaffed. They were not wholly efficient, but that is a reason for slimming them down, making them efficient and getting them to do their job more effectively rather than abolishing them. The North-West Development Agency had the same task as the others. It had to deal with business support, which I think is very valuable. It also had the task of directly stimulating development and regeneration by directing funds-many of them government funds-into schemes in the region. One problem is that a large number of those funds have dried up for the moment and there is no money to hand out. However, the present Government seem to be of the view that regeneration in terms of investment in the public realm and the public infrastructure is not efficient development and, unless the money goes directly to commercial activity to create jobs, it should not be done. However, who else is going to renovate the public realm and regenerate rundown areas if not the public sector? The commercial sector will come in and help but the underlying funding has to come from the public sector. However, it seems to me that that is drying up and it will need to be reinstated as soon as possible.

Furthermore, following the latest planning legislation, the regional development agencies were in charge of producing the regional strategies along with the leaders' boards, which had a temporary existence. I always thought, as I think my party did by and large, that it was not appropriate for an unelected regional development agency to act effectively as a regional planning authority. Whatever was going to happen to regional planning-it is currently being abolished, although it will probably have to come back-we would have had no problem at

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all if it had been taken away from regional development agencies, because it was not a suitable thing for them to do. I went back to the coalition agreement and it says:

"We will support the creation of local enterprise partnerships ... to replace regional development agencies (RDAs). These may take the form of the existing RDAs in areas where they are popular".

That was a fudge when the coalition agreement was hammered out, a compromise between the Liberal Democrat view that regional development agencies should continue to exist in areas such as the north of England and the Conservative view that they should be swept away. Within Government that turned into a turf war between BIS and the CLG and the CLG came out on top. Like the north-east, we in the north-west and people in Yorkshire thought that RDAs were going to continue in a slimmed-down form.

So what is happening? We are told that there's a regional growth fund, but there is much less to spend and it is being doled out centrally. The idea that politicians and civil servants in London are the right people to decide which projects in the north-west or in the other parts of the north of England-places 200 or 300 miles away-should be funded is not really credible. Decisions made in that way are not going to be good decisions. There is European funding-the ERDF-and the Rural Development Programme for England, but again the decisions are being taken centrally. A Written Statement from my noble friend Lady Hanham says:

"I have concluded that, in order to maintain compliance with the regulations and spending momentum, we should transfer the existing ERDF staff and functions into my department by the beginning of July".-[Official Report, 3/2/2011; col. WS 86.]

Except in London where it will be devolved to the Greater London Authority, presumably because the Greater London Authority exists. But in the rest of the country decisions about regional development funding are going to be made here in London. That just seems illogical.

Then we have the question of the transfer of assets. The regional development agencies have been asked to produce plans but they are not being allowed to make their own decisions. The decisions are going to be made by the CLG and BIS, depending on what those decisions are. Then, as one noble Lord pointed out, assets are going to be offered to local authorities at a commercial rate. In my experience in Pendle, some of the property which belongs to the regional development agency was bought by the RDA off local authorities in order to provide a source of regeneration funding by those local authorities. But the local authorities are not going to have that money-so what is now happening? People are realising that this is topsy-turvy and that it is not going to work. We are told that for future regional development agency funding, ERDF funding and rural funding, there are going to be teams based in the regions, perhaps collocated with the Homes and Communities Agency. We read in the papers that BIS is talking of setting up small regional offices in order to make sure that the decisions made are right for that region because people in London cannot do it. And we are told that for decisions on the regional growth fund the CLG is going to have teams of people in the regions because, again, people in London cannot do

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it. It is a scorched-earth policy. Everything is being abolished. I always thought that it would have to be rebuilt sometime. They are beginning to rebuild it at the very time they are abolishing what is there at the moment. There does not seem to be a great deal of logic about this.

The last thing I want to say is about LEPs-local enterprise partnerships-which are supposed to deliver the local growth policies, though they will have precious little government funding. The specific question I want to ask the Government-I do not expect my noble friend Lord Taylor to know but perhaps somebody can write to me and tell me afterwards-refers specifically to Pennine Lancashire, the part of Lancashire that wants to be a separate LEP from the rest of Lancashire based on Blackburn, Burnley, Hyndburn, Pendle, Rossendale and Ribble Valley, a very clear economic area which already has institutions in PLACE, which is a regeneration and development agency set up by the authorities in our part of Lancashire under a multi-area agreement. So we have a Government who tell us multi-area agreements are the way forward. We get on with it and produce an effective, genuine partnership between the local authorities, working very closely with the private sector, ready to go as a LEP. We know exactly what we want to do to convert it into a LEP and how to do it and still we are not being given the go-ahead. And yet the regional growth fund already exists. So who bids for our part of Lancashire? It is the body called PLACE which is the multi-area agreement body. That body exists and is bidding. Can the Government give an assurance that bids from areas like ours which are properly organised and properly submitted, even though we do not yet have an agreed LEP, will be treated on exactly the same basis as areas which already have a LEP? Otherwise we are being dreadfully discriminated against. I hope the answer will be yes but I would be grateful if somebody could write to me and tell me.

The regions in the north of England need to be recognised. Just because the existing RDAs have not managed to narrow the gap between areas like the north and London does not mean they have not done a good job. There is no evidence whatever that by maintaining the gap as it is, even if it has not been narrowed, they have not been doing a job. Without them the gap might now be a lot larger. Unless we see some research and proper evidence to the contrary, we will continue to believe that regional institutions are necessary.

Lord Knight of Weymouth: My Lords, I want to speak to Amendment 56, drawing on my experience as the Minister with responsibility for the south-west in the year running up to the last general election. I agree with much of what has been said in this debate so far, but I want to start by paying tribute to Sir Harry Studholme, the chair of SWRDA, and Jane Henderson, the chief executive, and all of their staff for the excellent work that I observed them doing during that year and the time preceding that when I was a Member of Parliament in the region. They were doing excellent work, largely on the supply side of the economy, developing sites such as Osprey Quay in my constituency, without which the Olympics would not be coming to the south-west, Gloucester Docks and the Science

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Park Network in the Bath and Bristol area. I endorse the questions that were asked by my noble friend Lord Beecham about assets and what happens to those assets owned by the regional development agency in reality.

SWRDA did excellent work in developing skills and 130,000 people have been provided with new work-related skills since 2002 in the south-west. Without SWRDA we would not have the combined university, the only university in Cornwall, which has been doing stunning work in developing the economy in that part of the region. Without it we would not have the marine skills centres across the south-west or the nuclear skills centre that is being developed in Somerset. SWRDA has been developing connectivity-the new generation broadband initiative in Cornwall, for example. It has been developing finance for business. The South West Angel and Investor Network comes to mind, as does the work that I was a part of in trying to get banks to focus on the needs of small businesses. Hooking banks up with a federation of small businesses in the region was very important as we were trying to respond to the recession.

So plenty of good work went on across the region, and although it is possible to argue that a region the size of Denmark will have some issues around its edges as to whether, for example, Bournemouth and Poole as a conurbation is best placed in the south-west or the south-east-and similarly with Swindon and Gloucestershire, given that Tewkesbury is closer to Scotland than it is to Land's End; these arguments will run-I would argue that we were just starting to get a sense of identity in the region as the RDAs were becoming successful.

I would argue that the sort of centralisation that we are getting, and which others have argued against, is a backward step. LEPs have already been announced across the south-west but there is none so far in Dorset, Bournemouth, Poole, Devon, Somerset Wiltshire or Gloucestershire. Huge swathes of my region will not have an LEP. Indeed, as the BBC reported, there is one down in Cornwall where we have the interesting spectacle of Sir John Banham being generously engaged for just over 20 days at half his daily rate-it is usually £4,000 but is now £2,000-to produce a strategy which has now been rejected. He has now left at a cost of more than £40,000 to the taxpayer. I cannot see that as good value for money from this new system.

7.30 pm

We are seeing a centralisation caused by Whitehall dictating what the LEP boundaries should be. As far as I can tell, the LEP proposals from the south-west have been knocked back because they do not appeal to Whitehall's notion of what the boundaries should be. The regional growth fund has been referred to, as has the centralisation of the Rural Development Programme for England and the ERDF. I had a conversation with a leading multinational technology company based in Swindon which said, "Once the RDAs are gone we cannot really have a good relationship with the two regions that are most important to us, as we do with other regional governments around Europe. Frankly, we haven't the energy to engage with lots of individual

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little LEPs, so we will engage with Swindon council and central government. We can't afford to do any more than that". We will have less engagement with the economy and less investment coming from a very important investor around the world.

I would also argue that there is an ideology attached to this. Clearly the Government are against regional policy even though it works in many other successful economies around the world. But they are also against an industrial policy and industrial activism. We would not have the Eden project were it not for the risks that were taken in part by the South West Regional Development Agency. Everyone knows the impact on south-west tourism to have Eden developed in Cornwall. As I said, we would also not have the Olympics. We should consider what has been done around creative hubs across the south-west, which is one of the strengths of our region, or for green industries. The Minister needs to give us an answer on whether the Wave Hub, which is so important in the south-west, would have been developed without a regional development agency. Could LEPs develop that? Would it just be one of the things that would bid into the regional growth fund? I do not know.

The composite centre, which I was pleased to open, built on the aerospace expertise of the region held by Rolls-Royce, GKN, Westland and Airbus. Aerospace manufacturers and the University of Bristol bring their expertise and they are supported not only by BIS in Whitehall but, crucially, the RDA. World-beating composite technology is being built in Bristol. Would that have happened with a LEP? Would it get through a much more competitive regional growth fund strategy? More than 100,000 public sector jobs are projected to be lost in the south-west, many of them in areas where LEPs are not set up. Under this new set-up, how will those jobs be filled in an area that is peripheral compared with the south-east?

My final substantive point concerns value for money. I have already mentioned the scandal of the amount of money that went to Sir John Banham. I looked at the independent evaluations of RDAs, and it appears that only 10 per cent of the overall budget was spent on administration and that it had a clean bill of health from the National Audit Office. That 10 per cent figure is something that many parts of the public sector and indeed some parts of the private sector would be pleased to score. I think that £238 million was spent on administration. That is all the saving that is potentially there. As has already been said, even if my party had been re-elected, we would have had to cut the overall budget and the administration costs with it. It is not a massive saving given that for every pound spent, £4.50-the more conservative estimate-is generated in the economy. These are the questions that the Government need to answer.

Lord Phillips of Sudbury: I am sorry to interrupt the noble Lord, but he has twice mentioned Sir John Banham, and his last reference was in terms of a scandal. Will he make it clear to the Committee that if scandal there be, it is not to be laid at the door of Sir John Banham, who is a friend of mine and a considerable public servant, but should be laid at the door of those who put him on the task?

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Lord Knight of Weymouth: I do not know Sir John Banham but it seems extraordinary that more than £40,000 has been paid out from the Cornish LEP to commission him to do a job that was then rejected. Something in that process has gone wrong. I know that he has done other work and given service in public life. I have nothing against him personally, but something has gone badly wrong. We need to learn lessons from that. If we are to make savings out of this process, which one assumes is part of the motivation, we cannot afford for any of those individual LEPs to be making £40,000 errors. That money needs to be spent on creating jobs, particularly for young people-to reprise what my noble friend Lady Armstrong said.

In summary the Minister needs to say why we are going for an ideological centralisation and anti-industrial policy position. Where is the value for money out of this abolition of the regional development agency?

House resumed. Committee to begin again not before 8.38 pm.


Question for Short Debate

7.38 pm

Asked By Lord Dykes

Lord Dykes: My Lords, this is again a very important moment to have a debate on this matter. I am grateful to the House for giving me the opportunity this evening.

Over the weekend it was good to see for once-unusually, and I suppose sadly-the unanimous decisions of the UN Security Council calling on Colonel Gaddafi to account for the abominable behaviour that he is wreaking on his own people. In contrast, how depressing it was to see-once again, and probably for the 42nd time-the previous weekend's United Nations Security Council session being ruined, even recklessly sabotaged, by another US veto concerning the Israel/Palestine issue. A seemingly unanimous decision in a moderately worded resolution asking Israel to obey its international law duties in occupied Palestine was deliberately-I am sad to use the verb-wrecked by the US. This time it caused universal resentment, even hatred, towards America among some of the other Security Council members. Some of them kept silent counsel, but they did so with great sadness.

Once again the US refused to condemn behaviour which even President Reagan repeatedly described as totally illegal: the continued colonisation of the West Bank and, of course, East Jerusalem. Once again the Arab street sees the double standards of the US. Saddam Hussein invaded Kuwait and was quite rightly expelled after a year. The UN, quite rightly, did not hesitate then. Israel invaded the West Bank 44 years ago, but it is still there.

I warmly congratulate the UK Government as well as the EU on their much more decisive stand in

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contrast to the still lingering, miserable and self-inflicted humiliation which is further eroding America's already tattered so-called leadership of the western world. Indeed, Barack Obama made it even worse by allowing the long-suffering Department of State-and I have enormous sympathy for many of its senior officials dealing with this matter-to leak the sad news that he imposed the veto with a heavy heart. The US ambassador to the UN, Susan Rice, was even allowed to make some harsh comments on the illegal colonisation policy. Even the former Israeli consul-general in New York, Alon Pinkas, said that this should be the last-ever veto since Americans in general were sick and tired of the continuing charade carried out in their name. Even Israel military radio carried a reaction of disbelief.

The cynical use of the veto by America so blatantly and so often is a madness that must not continue. Furthermore, against the background of the momentous events now in surrounding Arab countries, where the essence of the people's democracy is rising up against tyranny and the abuse of power, we see just how monumental have been the mistakes made by the US and by us, too, the West as a whole, in the frenzied, relentless search for oil at any price-any political price and any price of freedom. The whole history of the West's presence in Arabia is indeed a saga of wretchedness and despair for ordinary citizens in most of these countries, much of that manifested now in the words used by the rioting crowds in the various squares in the various countries when they are interviewed by the media.

As in Latin America for so many years, we remember with pain that the US in particular has always preferred the brutal dictator regimes, as it does now in Arabia. Surely now is the time for the former imperial powers and the US to restore the balance of hope in this crucial area by following an ethical foreign policy, as well as by curbing arms sales and stopping support for unacceptable regimes, even Saudi Arabia with its corrupt royal dictatorship. Above all, now is the time for Israel, too, to show decency and wisdom at long last in its policy towards the cruelly treated Palestinians.

Make no mistake, Israel is a country that I greatly admire, and I have done so for many years. I admire many of the people there. It is a great country. It has a great contribution to make in the Middle East.

Meanwhile, however, across the fence, we see Fatah struggling for the legitimacy that it lacks in the Arab street. That is one reason why it will not join in negotiations until Israel acknowledges its offences under international law and the Geneva conventions on the treatment of civilians and shows a complete change of heart. That is a responsibility that is as solemn for an occupying power as it is for a country that actually owns the territory legally. Can the present Israeli Government-who so sadly include a number of rather extremist members, though I will not mention any names tonight, and who have been such a disappointment -accept this reality at long last? I hope so. In doing so, they would be meeting the fervent wishes of millions of decent, fair-minded Israeli citizens who want peace and security and good relations with their Arab and Palestinian neighbours.

With the Palestinians seemingly prepared to accept that a two-state outcome will accord them a mere

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23 per cent of the original combined mandate territory, there is no longer any rational reason for Israel to prevaricate even if aided by a totally incompetent American support stance. That will mean that the settlers have to leave the illegally occupied lands. Let us repeat that loud and clear. The Israeli Government can easily provide financial assistance for resettlement back in Israel proper. There is, for example, plenty of spare space if the Negev, too, is properly developed with infrastructure and modernised in the future. This process has not yet even begun to take place on a massive scale. While they are about it, surely the Israelis can modernise their hopelessly outdated election system and reduce the blackmail of the tiny extremist parties in the Knesset.

Yes, it will mean that the international community has to accept the inclusion of Hamas in any fundamental, realistic negotiations for peace. It is outrageous that it has been excluded when it is the main Palestinian political grouping capable of securing a genuine democratic majority. What a contrast to the Fatah president's desperate and lamentable efforts to secure street support, having already blatantly exceeded the mandate period. At long last elections are now in the offing, thanks to the pressure that he was facing, but it will be outrageous if the Palestinian Authority seeks to exclude Hamas from the West Bank election activity-or, indeed, per contra, if Hamas seeks to consolidate one-party rule in Gaza, which is surely just as unacceptable, preventing other parties there from having a say. Leading Palestinian political commentators of all groups were certainly too eager to express support for the dodgy dictators, some of whom have now been removed, in Tunisia, Egypt and Libya. We are also now observing the events in Yemen.

Any elections in the near term must restore the confidence of the street in the West Bank. They must help local voters feel that they are playing a full part in the wider Arab uprising which we are now excitedly witnessing. Huge problems are still being caused by the long-running American stupidity and carelessness in the Middle East, and they will take time to sort out. Israel must show it can rise to the occasion at last. As William Hague stated on 14 February:

"We are calling for both sides to show the visionary boldness to return to talks and make genuine compromises ... the entire international community, including the United States, should now support 1967 borders as the basis for resumed negotiations. The result should be two states, with Jerusalem as the future capital of both".-[Official Report, Commons, 14/2/11; col. 716.]

After all the tears and madness of history, cannot the world work for the two friendly states, side by side, erasing the tragedy of Israel's failure to be magnanimous and generous after its spectacular 1967 victories? Then we could perhaps see a rewritten version of the Balfour declaration. Let me try this one to see if it is congenial: "As long as it is not to the detriment of the 62 year-old state of Israel, a renewed homeland will be created for the state of Palestine, a modern democratic and progressive republic, with financial assistance from the international community, the two neighbours respecting human rights and their reciprocal friendship, producing in due time the near east common market for the prosperity of all".

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7.46 pm

Lord Bates: My Lords, I thank my noble friend Lord Dykes for securing this timely debate and also for the way in which he has presented it. I believe that the only hope for the development of civilisation is to advance towards a society of states under a rules-based international order. The argument is that there is a community or society beyond the nation state of which we are all part and being part of that club comes with international rights and responsibilities.

The alternative to a rules-based international order is anarchy in which the powerful do as they will while the weak suffer as they must. That is the completely opposite end of the spectrum from which I am sure we all entered politics. We wanted justice to trump power and protect freedom and if anything have a bias to the weak and the oppressed. This too was the desire which led to the creation of the United Nations out of the carnage of World War II. Article 1 of the UN Charter says:

"To bring about by peaceful means, and in conformity with the principles of justice and international law, adjustment or settlement of international disputes".

Why is that relevant to this debate? Well it is relevant because we have voluntarily agreed along with 191 other nations to work for peace within a framework of law and non-violence. Why is that especially relevant to Israel? The state of Israel exists in international law only because the United Nations Special Committee of Palestine in 1947 proposed that it should be along with an Arab state of Palestine and because United Nations Resolution 181 said it existed in international law.

I would argue therefore that there is a special reason for the state of Israel to look benevolently upon the United Nations institution for it, more than any other nation or institution, has realised the aspirations of a Jewish national homeland and enshrined that in law. It therefore requires it to comply with its requests expressed through resolutions and work with the United Nations despite its manifold imperfections to bring about the creation of a viable Palestinian state as equal partners in an international society of nation states.

7.49 pm

Lord Judd: My Lords, I too congratulate the noble Lord, Lord Dykes, on having so firmly introduced this debate today. I would just like to make two or three points. First, I think historically it is a major tragedy that we have seen the United States behave as it has at the United Nations in recent weeks. It is while the United States still has ascendency in the international community that it is so important for it to throw its weight behind the strengthening of international institutions and international law. That is in the interests of the future of the people of the United States because it will not always have that ascendency. It will then-too late, perhaps-realise the importance of having strong international institutions and the rule of international law.

Secondly, what is so sad about what the United States has done is that it is absolutely counterproductive to the security of Israel. It will not help the people of Israel. No one cares more than I do about the future

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of Israel; I have many friends in Israel. I am glad that the noble Lord, Lord Bates, and the noble Lord, Lord Dykes, in introducing the debate, referred to the people of Israel letting down themselves. Many people in Israel want the debate in Israel to open up. They have a completely different perspective on the future. They see that the future of Israel, the strength of Israel and the safety of Israel lie in negotiated settlements and making peace with the people in the surrounding area.

If there is to be peace in the region, it is essential that negotiations are as inclusive as possible. That is where the noble Lord, Lord Dykes, is so right again-he has done it before-to emphasise the importance of Hamas. At the moment, there is a self-fulfilling prophecy: we strengthen the extremist elements in Hamas. They are not all extremists in Hamas; we should be strengthening the more moderate elements and bringing them in to help move the negotiations forward.

Finally, let us just remember that when we talk about aggression and the threat of aggression, of course it is wrong to kill innocent Israelis. That cannot be condoned, but what about the bombardments of the so-called buffer zone within Gaza? What about the 52 innocent people killed within the buffer zone last year? What about the embargo and the damage that it has done to the health, well-being, industry and economic life of Gaza? Is that not aggression? From every standpoint, the American position has been disastrous.

I congratulate the British Government with one reservation. Having made such a courageous, firm and sensible stand at the UN, why on earth did the Prime Minister at this very juncture go with a group of arms salesmen to the Gulf, sending a completely contrary message to that which is inherent in everything that we are arguing about how peace and security need to be achieved? That was counterproductivity of the first order.

7.52 pm

Baroness Falkner of Margravine: My Lords, I apologise to the House for my delay in attending the debate of my noble friend Lord Dykes. I was detained in my room momentarily.

It is nearly 18 years since the Oslo peace accords showed a ray of hope for a peace settlement; but 18 years later, we find ourselves at an impasse. The history of US involvement in recent times-we can go back to the Camp David accords, the Madrid conference, the Clinton parameters and Annapolis-should have yielded greater results than they have. Of course, it does not fall to the US alone to secure peace in our time in the Middle East, but recent US efforts have been particularly disappointing. We have had fine rhetoric since the inauguration of President Obama and the expression of lofty ideals, but we are no closer to a solution than at any time before Oslo.

If the US continues to be rebuffed in the manner that it is being rebuffed at the moment by the Israelis, the question is to be asked whether the will for peace exists between the Israelis and the Palestinians, because there will be a comprehensive peace only if both sides are prepared to sit down to sue for peace, irrespective of the position of other powers.

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There is little to bring Israel to the table when it can create facts on the ground with impunity in its settlements, its separation wall and, above all, its electoral system, which allows for its most extreme elements to sit at the table. The Palestinians, too, have settled for a dual-track strategy: that of securing economic growth by Fatah in the West Bank, while Hamas seems to be torn between being, on the one hand, the Government in Gaza and, on the other, still playing the role of insurgent when it suits it. Fatah, we hear, will try to seek a unilateral declaration of independence, but that, while giving it legitimacy, will not give it back East Jerusalem or freedom for the Occupied Territories and will certainly not give the people who languish in the camps the right of return.

My noble friend Lord Dykes talked of the democratic trends in the Middle East. If there is one silver lining, it is that the Arab nations together, once they move to more democratic and legitimate frameworks, could secure Israel by normalising relations with Israel. That would be a significant step forward. The West should stand by to facilitate that through encouraging democracy and pluralism in those countries but, ultimately, the peace, such as will come, will have to be made between the two countries alone.

7.55 pm

Lord Bew: My Lords, I, too, thank the noble Lord, Lord Dykes, for introducing the debate on this important subject. I start by declaring an interest as the incoming chairman of the Anglo-Israel Association and say that as someone who was a strong advocate in the early and mid-1990s of what became the Good Friday agreement solution in Northern Ireland, I am strongly committed to historic compromise as the means to overcome the tenacious problems of ethnic, religious and national political divides.

I want to concentrate on the issues surrounding the United States, the United Nations and our foreign policy in recent days. One point has to be made about the decision made by the American Administration in the lead-up to the recent United Nations vote: 110 congressmen wrote to the Administration to say, "Do not support this anti-Israel resolution". In the end, the Administration compromised. Critical points were made about Israeli policy. I say wryly and not with overwhelming pleasure after 30 years experience of the Irish question that 110 congressmen is 109 more than you need to countermand any dialogue between our Foreign Office and the State Department. We must respect profound political realities for any United States Administration.

On the United Nations decision, one point made by the American ambassador to the UN, Susan Rice, seems to me of some substance. She argued that, had the United States not vetoed the resolution, it would merely have hardened opinion on both sides. More profoundly, it is clearly the view of the United States that the United Nations-its resolutions and its theatre-is not the context for the resolution of the Middle Eastern problem. That is the message that the United States is sending to us. We may not like it, but we have been sent that message very firmly.

The problem is seen more profoundly as one of land for peace and of convincing enough Israelis, in

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the aftermath of the disappointment that many Israelis feel about the consequences of withdrawal from Gaza, in both the political class and the population at large, that land for peace is a gamble that they can take on. That is the fundamental problem. It is not helped by one-sided denunciations of Israel and the failure thus far in the debate to acknowledge the consequences for many Israelis and the disappointment felt because of one risk that was taken: the withdrawal from Gaza. That is the reality with which we are now faced in this context. The United Nations and its resolutions are, in a sense, background music.

7.59 pm

Lord Tugendhat: My Lords, I, too, thank the noble Lord, Lord Dykes, for launching this debate. The best reason for working closely with the United States in the past was that it always seemed to have the best chance of bringing about a just and peaceful resolution to the Israel-Palestine dispute. Sadly, we now seem to have reached the point where that is no longer the case. Israel remains obdurate. The United States is unwilling to act as a candid friend. The result is the recent vote in the United Nations Security Council, in which the United States found itself isolated, as did the Israeli position of settlements and occupation. I hope that the United States will learn from this embarrassing debacle, which has separated it from almost all its closest friends and allies. It is still the best hope for securing a just resolution to the Israel-Palestine dispute.

However, we, and other countries who believe that Israel's current contra mundi defiance is against its own long-term interest as well as a danger to peace, should no longer wait on the United States. At this critical stage in the Middle East, when hope and fear are so finely balanced, we must be open and frank about our abhorrence of Israel's current settlements policy and the concomitant occupation that it involves. We should bear in mind the wise words of David Shulman, the Renee Lang professor of humanistic studies at the Hebrew University of Jerusalem, when he talks about,

We must make clear the extent to which that policy diminishes our friendship for the Government-as distinct from the people-of Israel, with the practical consequences that must inevitably flow from this. It is very sad that we should be in this position. As the noble Lord, Lord Dykes, and others have said, there are many in Israel who do not share the views of its Government. I pay particular tribute to those Israeli soldiers who recently produced the book, Occupation of the Territories: Israeli Soldier Testimonies 2000-2010. It is to those voices in Israel that we should listen and not always to some of the advocates of the hard-line policies of the Government that we hear in this House.

8.02 pm

Lord Janner of Braunstone: My Lords, does this House recognise that Israel is the only democracy in the Middle East? Democracies, like Israel or this country, do not always elect the Governments whom we would

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vote for. However, in my view, Israel continues to play an important role in the international community. It represents a bridge between Europe and the Middle East. It represents democracy, liberty and freedom in a region that has long been filled with tyrannies and dictatorships. We have all seen the people's aspirations, which have long been suppressed, now released in recent revolutions in Tunisia, Egypt, Bahrain and now Libya, which we should welcome. We should recognise the fact that the only democracy in that area is the country that Members of this House have been attacking so readily this evening. The instability of the region has always been a major problem for Israel. However, the current revolutions in the Middle East present an opportunity for Israel and the world.

The primary role of a nation state is to defend its borders and citizens from attack. Israel faces a tough task. Its duty is to defend its citizens. Hamas is not a Government and Gaza is not a nation state. Hamas has been praised. However, Hamas is a terrorist group, which rains terrors on civilians in Israel. These terrorists ignore international law and they, not Israel, should be the key focus of this debate. Let me make it clear to this House: Israel does not target citizens, unlike Hamas and Hezbollah, which target citizens in many parts of Israel. Mistakes occur in warfare, just as mistakes have occurred in Afghanistan and Iraq. When these mistakes happen, investigations are launched and, where possible, justice is delivered. I would have been interested to hear how the noble Lord who triggered this debate would himself have responded if we in this nation suffered from attacks from terrorist entities, which is the position that Israel has to face. Many of these terrorists were funded and armed by an Iranian regime dedicated to the destruction of Israel and to attacks on Jewish people around the world. The true question for this House is who the real abusers of international law are: Israel, which defends its citizens, or the terrorists who target them.

8.05 pm

Baroness Tonge: My Lords, I congratulate my noble friend on introducing this debate tonight. I have somewhat had my breath blown away by the speech of the noble Lord, Lord Janner.

The international community is outraged by the behavior of Colonel Gaddafi towards his people in Libya and has rightly condemned his actions, which have violated human rights and international law. The reaction from our leaders has been swift and decisive. Sanctions are being imposed and bank accounts frozen-quite right too. Any Government who behave in this way should receive the same response. Why, then, has the Government of Israel, who defy all international law, never been called to account by the international community and, why, just last week-as we have heard from other noble Peers-did the USA veto the UN resolution on settlements after calling for a freeze on those settlements just a few months ago? Why has this happened when the behaviour of Israel towards the Palestinians lies at the very root of the problems in the Arab-Muslim world?

Tonight, I want to raise briefly the subject of prisoners and their treatment by Israel. At the end of January, there were 5,642 Palestinian prisoners in Israeli jails,

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621 of whom are still awaiting trial and 219 of whom are being held in administrative detention for no good reason, without any charge or prospect of trial. Since 2000, over 7,000 children have been held in Israeli prisons. There are currently 221 children in prison. A horrifying report has been submitted to the UN by the Defence for Children International. I beg your Lordships to read the report. Most children had been accused of throwing stones and were subjected to various forms of torture and forced to sign statements written in Hebrew. There is no time to give the detail. However, this is a sure way of providing embittered terrorists who will hate Israel for the rest of their lives.

After four years in prison, three members of the PLC are now threatened with deportation from their homes and constituencies in East Jerusalem and have taken refuge in the Red Cross. Is imprisonment for winning an election permitted under international law? I think not. Israel is immune to international law. We have to face this. The USA and Europe collude in it and I hope that the Minister will tell me why.

8.08 pm

Baroness Deech: My Lords, we have had a stream of similar questions over the past few months evincing a disproportionate focus by this House on Israel, now evident in the turmoil in the Middle East. These questions are based on some implicit but unsustainable assumptions-for example, that Britain has any influence over Israel and Palestine or that it should be following and supporting American policy, which has been criticised here tonight. The UK risks becoming a spent force in this area because it is no longer seen as even-handed by Israel. The Foreign Secretary's recent comments have made this situation even more partial. The judgment of the UK Government and their advisers over the Middle East is suspect. We have got it wrong for years.

As we speak, international humanitarian law is being ignored to the damage of millions in the region. Israel has not been the focus of the rising-up by the peoples of Tunisia, Bahrain, Egypt and Libya. Indeed, I once heard an ambassador from the region say to an audience that the Arab states did not really care about Israel at all, but it was a useful deflection from the problems internal to their states.

As far as the UN goes, one would have thought that to point out that Libya and Bahrain have seats on the United Nations Human Rights Council would suffice to make one sceptical, but the law and the resolutions are not clear. The fundamental issue is that Israel itself owes its existence to the League of Nations and the UN and has a right of self-determination and self-defence, which has been rejected wholesale ever since 1947 by its neighbours. For example, today is the last day of Gilad Shalit fortnight. This young Israeli solider has been held for four years by Hamas and denied all visits, even from the Red Cross, in breach of international humanitarian law. This is one matter that the UK Government can take up if they wish to promote the rule of law in the region.

The UK can also be constructive in building normal relations. The noble Lord, Lord Stone of Blackheath, made a moving and impressive speech on 11 February

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describing the work in which he is involved in bringing Israelis and Palestinians together in education, health and the environment and in fostering economic prosperity in the West Bank.

The UN is not the place to bring pressure on Israel to end the occupation and to freeze settlements. That has to be done by negotiation. This Government must support a two-state solution and reject the delegitimisation of Israel. They could encourage and help Arab leaders to invest in infrastructure, housing and general state-building for a future Palestine. They could promote the education of Palestinian youth towards a future of peace and co-operation, not rockets and hatred. They could rehabilitate housing so that refugee camps become decent habitats. There are obvious opportunities and responsibilities for the UK Government if they heed the voices of reason.

8.11 pm

Lord Palmer of Childs Hill: My Lords, I compliment my noble friend Lord Dykes on securing this short debate. I know that he, like me, seeks a lasting peace in the region based on a two-state solution with a secure state of Israel alongside a very viable Palestinian state. Of course, it is helpful if United Nations resolutions are complied with but, as my noble friend Lord Dykes pointed out, they are resolutions of the General Assembly, not of the Security Council. Israel has complied with every resolution of the Security Council, with all its faults. In fact, it complied with only one, on Lebanon. There have been no others.

However, my view is that, contrary to the name of this debate, trying to solve the long-standing conflict by United Nations resolutions is not the way forward. As my noble friend Lord Dykes suggests, Her Majesty's Government and the United States could have a role, but I am certain that the first step must be, as the noble Baroness, Lady Deech, said, to get the Israelis and the Palestinians to the negotiating table. I would add to that "without preconditions". That is the problem. The Palestinians say they will not go to the negotiating table unless something happens-for example, no settlements. The Israelis say they will not go unless they are recognised by everyone. My view is that the United States, the United Kingdom and others should ensure that they sit down at that negotiating table without any preconditions whatever. Once they are there at that table, I believe that things can be solved. For those who study the region-I am a former chairman of the Liberal Democrat Friends of Israel and I have studied it deeply-there is a desire for a solution. Most people know what that solution will be-where roughly the border will be. Once there is a border, the settlements that are on the non-Israeli side of the border will no longer be there as settlements. You solve it at a stroke. At the same time, we have to ensure that there is no psychological and practical warfare on Israel, where the towns of Sderot and Ashkelon in Israel are bombarded by rockets, producing a psychological and practical fear in Israel; it is this that produces some of the attitudes of the Israeli Government, of which many in this House might disapprove.

I ask noble Lords to think about the fact that our duty as a country is to get these people to the negotiating table and to bear in mind that this is not only about

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Palestinian refugees; 800,000 Jews fled Arab lands, of which 600,000 found a home in Israel. Refugees, sadly, are part of life. Many of us have been refugees or have parents who were so.

8.15 pm

Lord Beecham: My Lords, I come to this debate as a committed supporter of Israel and a committed critic of its Government: as a committed supporter of a two-state solution and an opponent of the settlements. The question of the legality of the settlements in international law is perhaps more arguable than is normally thought to be the case, but that is an irrelevance here; I certainly oppose the settlements. Whether, in the reported words of a distinguished Member of this House, this makes me an intelligent but prejudiced Jew, I do not know-I leave it to others to determine.

I agree with the noble Lord, Lord Dykes, in his criticism of the political system in Israel. Interestingly, of course, it is a very pure form of proportional representation, which presumably he would like to see in this country. He also referred to the 1947 resolution that created the state of Israel: a resolution that, if it had been complied with, would have led to the creation of an independent Palestine. It was not complied with because Egypt and Jordan decided not to implement it. Jordan occupied the West Bank and Egypt occupied Gaza. The reality is that, 60-odd years later, many of the states in the region still do not recognise the existence of the state of Israel-and more particularly, and crucially, neither does Hamas. If Hamas had followed Fatah and the Palestinian Authority in recognising the state of Israel, it would certainly be a legitimate partner in a dialogue. That is clearly a consolation that all of us here in your Lordships' House would like to see.

I will refer not so much to the general issues but to small yet positive steps that might be taken-and indeed have already been initiated-in developing the democratic structures within Israel and potentially within Palestine. So far as Israel is concerned, they relate to the Israeli Arab community. In my former days in the Local Government Association, I managed to initiate a scheme for capacity building within the Arab municipal sector in Israel, supported by the previous Government, with a modest amount of funding that is still available during the current year. I hope that the present Government will continue with that programme, and seek to extend it to the Palestinian Authority itself. It is clearly in everyone's interest-other speakers have referred to this-to promote democracy and state building within the Arab world. Here is an example of where it can happen.

The event two years ago in Israel, which saw people from local government in this country going over to work with newly elected Arab mayors, can be repeated-I hope it will be repeated. This is a principle that might well be extended to the territories. The Local Government Association signed agreements with both the local government associations of Palestine and Israel, and here local government can play a small positive role in developing the kind of structures-and ultimately the kind of contacts-that can only help lead to a peaceful resolution. If we were to concentrate more on the

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practical issues and a little less on the rhetoric about the serious problems of the region, we might see more progress.

8.18 pm

Lord Alderdice: My Lords, I think we are all grateful to my noble friend Lord Dykes for giving us an opportunity to address this serious question again, albeit in a very short time. Most of us have only three minutes. I will raise just three points; the first is an observation, the second is a fear, the third is an appeal.

My observation is that in these conflicts in general, and in this conflict in particular, it is not only those who are in the conflict who are exceptionally passionate about it; those outside who have any interest and concern-indeed, almost anyone who gets involved-are passionate on one side of the argument. It seems extremely difficult to contain the problem and feel strongly about it, but not feel strongly for one side and against another. The noble Lord, Lord Bew, will recognise that very much from our own experience, and we have seen that demonstrated here tonight. When people become very passionate, it becomes difficult to think clearly and reflectively about a problem.

My second point expresses a fear. I have been going backwards and forwards to the region for a number of years. When I first started to go, I was a little optimistic about the possibilities. In Israel, I met people in the Government, in the Opposition and in civic society. I met people on the Palestinian side in Fatah and Hamas, and in Lebanon, Syria, Jordan and Egypt, and I had a sense that people wanted to move forward, but in the past couple of years I have felt that opportunity for progress slipping away. A two-state solution would be an ideal thing to achieve, but increasingly it is beginning to slip off the agenda. Israel is the country that needs a two-state solution because I cannot for the life of me see how you can have a Jewish democratic state unless you have a homeland for the Palestinians, yet it is becoming harder seriously to believe that a two-state solution remains possible.

I hope that I can be persuaded otherwise by the facts and I want to see it, but those who believe in an historic existential right for Israel to extend the whole way from the sea to Jordan are mixed together with those who would like a two-state solution but feel that there is no possibility of a partner for peace in the Palestinians and those who want a two-state solution but now see no prospect of one. They are all mixed together and there is almost no other side of the argument in Israel. That is extremely worrying.

My final point is an appeal for international law. I tried to address the question of Gilad Shalit, which was mentioned by noble Baroness. I met his family and senior officials in Hamas and they said, "We found that this is the only way we can get our prisoners out. We cannot get them out by legal means so we get them out this way. We have found that we can do a deal with the Israeli Government". I hope for his sake and for his family that Gilad Shalit gets home soon. I hope that the Palestinian prisoners also get home soon, but that is what happens when international and domestic law are set aside because of passions. I appeal for a return to the rule of law, for without it there is only chaos in the Middle East.

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8.22 pm

Baroness Jones of Whitchurch: My Lords, I thank the noble Lord, Lord Dykes, for giving us the opportunity to debate this crucial issue this evening. As several noble Lords have said, the movement for democracy across the Middle East, while causing short-term anxiety about the loss of life and the intransigence of some regimes, must ultimately offer a precious moment when new politics and real change can be delivered. That is why the Foreign Secretary was right to say that the turmoil in the Middle East should be used as a springboard to reignite the peace process.

At the same time, it goes without saying that we have to be sensitive about our comments and/or interventions when the region is in such flux, particularly in the context of our own history. That is why the United Nations, imperfect though it is, continues to provide a respected forum for determining the common good and the rule of international law. That is why it continues to have an important role to play in the Middle East peace process.

We remain concerned that the peace talks initiated by the Obama Government appear to have stalled. No one underestimates the difficulty of the task involved in bringing the two sides together for meaningful dialogue, but with any new Government there is hope for a fresh approach and a renewed determination that they might make progress. In addition, President Obama himself signalled from an early stage that this would be a priority for his Administration and we desperately want him to succeed, but since the 10-month moratorium expired last September Israel has resumed construction in the West Bank and East Jerusalem-an act that it knows to be provocative not only to the Palestinians but to much of the rest of the world.

We also know that the Obama Administration has called on Israel to cease construction and return to the peace talks. However, that appeal appears to have been ignored and it may well be time to face the fact that diplomatic initiatives of the past need to be backed by other forms of pressure. Perhaps the Minister can update the House as to any discussions that are taking place between the Foreign Secretary and his US counterpart in this regard.

This brings us to the recent UN resolution that condemned the Israeli settlement construction in Palestinian territory. It was a resolution in accord with the stated policy of the US, but nevertheless the Administration chose to stand alone and veto it at the Security Council. As we have heard, their justification for this decision was that it would complicate efforts to resume the peace talks. With some sadness, I have to say that this position might have had some legitimacy if there had been any evidence of a pending breakthrough in kick-starting the peace talks, but as things stand, the US position has weakened both its own role and the UN's voice in bringing the parties together, and has regrettably encouraged further illegal construction of Israeli settlements.

I welcome our own Government's intervention on this, and the fact that we supported the UN resolution, and I hope that the Minister can update us on some further discussions that have taken place behind the scenes on this. Whatever route it takes, and whoever

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ultimately succeeds in bringing the two sides together, it remains the case that any settlement should include a two-state solution, with a permanent end to hostilities, an agreement on the boundaries of a new country of Palestine, an end to the West Bank settlement expansion, and a resettlement of illegal occupiers.

Finally, I hope that both our own Government and the United States can seize this chance and play their role in bringing about a lasting Middle East peace settlement based on these principles.

8.26 pm

The Minister of State, Foreign and Commonwealth Office (Lord Howell of Guildford): My Lords, I give warm thanks to the noble Lord, Lord Dykes, for opening this brief debate in such a robust fashion. I will come to some of his points in a moment. It has inevitably been a somewhat staccato debate, given the very short time in which noble Lords have been able to speak, but quite often in these very short debates we get the distillation of remarkable wisdom in very few words. Some very profound things have been said very clearly by a number of your Lordships who obviously have a huge hinterland of knowledge, but three minutes places a severe limit on what can be said. Whether in my few minutes I will be able to comment on every one of the contributions is in the hands of the gods. If I cannot do that, I apologise in advance, and will certainly discuss with or write to noble Lords who feel I have not addressed their points sufficiently.

Before I come to the detailed points in the debate, let me say that the United Kingdom Government are committed to upholding international law, as enshrined in the United Nations resolutions and the Geneva Conventions, and the Israel-Palestine conflict which we have been debating this evening is no exception. Our commitment was most recently demonstrated when, on Friday 18 February at the UN Security Council, the United Kingdom and others, including France and Germany, voted to reinforce our long-standing view that the Israeli settlements, including those in East Jerusalem, are illegal under international law, are an obstacle to peace, and constitute a threat to the two-state solution. It was a matter of regret that it remained a draft resolution, and that the UN Security Council could not speak with one voice on this issue. A number of your Lordships have concentrated on that very point.

The reasons for the US veto were given at some length by the spokesperson. They are, in a sense, the US's own reasons. They argue, as the noble Lord, Lord Bew, reminded us, that the UN Security Council was the wrong place, and that pursuing the issue there might make negotiations harder. The US delegate also reminded us that they rejected the legitimacy of settlement activity, which may be some sliver of comfort for those who have found this such a pity, but that they saw this as the wrong forum in which to push forward the proposals of the Palestinians and the Palestinian-initiated draft, and therefore opposed it. We were in regular contact with the US on the run-up to the vote. I have been asked what contact there has been between the Foreign Secretary and Secretary of State Hillary Clinton. The answer is that there has been contact; there was in the run-up and there has been since on

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this matter. The Foreign Secretary made it clear that Israel's obligations under international law are central to making progress toward a two-state solution. That remains our view.

I have heard some argue that current events in the region mean that this whole matter may be pushed aside by the turmoil that we have seen in north Africa and elsewhere. I think that that is completely wrong. Indeed, my right honourable friend the Prime Minister said as much this afternoon in his Statement in another place. We believe that Israel's security and the realisation of the Palestinians' right to statehood are not opposing goals at all. On the contrary, they are intimately intertwined objectives, and we should push ahead and make them with the MEPP, which becomes even more vital in the present circumstances.

Our main goal is to work with the United States and other international partners to return the parties as soon as possible to direct negotiations towards a two-state solution, on the basis of clear parameters. I know that the noble Lord, Lord Alderdice, with his great experience cast doubt on whether the two-state solution is still possible. We believe that it is, and that it remains a goal, and that we should go for an agreement on the borders of the two states, based on 4 June 1967 lines with equivalent land swaps, as may be agreed between the parties. That is the first basis of our approach. The second is to have security arrangements which, for Palestinians, respect their sovereignty and show that the occupation is over and, for Israelis, protect their security, prevent the resurgence of terrorism and deal effectively with new and emerging threats. That was a point of view that the noble Lord, Lord Janner, and others put in this debate, where we have witnessed the same divisions of view as exist in the wider world about this whole difficult matter, even in our brief contributions.

Thirdly, we believe that a just, fair and agreed solution to the refugee question should be the basis of progress. Fourthly, we believe in the fulfilment of the aspirations of both parties for Jerusalem. A way must be found through negotiations to resolve the status of Jerusalem as the future capital of both states.

In a few more of these precious minutes, I turn to a number of specific points raised. The noble Lord, Lord Dykes, spoke out very forcefully of his regrets about the position of the USA. Without necessarily approving of it-on the contrary, we voted the other way-I have tried to describe the view that the United States took. He also urged, as have other of your Lordships, both in this debate and many others, that we should talk to Hamas. The United Kingdom's view is that we should not talk to them until it renounces the ideology of violence, and that it should begin to emerge as part of the solution rather than part of the problem. That is the view of the Government at this time, although I know that some of your Lordships disagree with it.

My noble friend Lord Bates made an impassioned plea to comply with UN resolutions and reminded us of the vital point that the UN gave birth to Israel. Therefore, it is the duty of Israel to do all that it can to

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comply with UN resolutions. The noble Lord, Lord Janner, said that in many respects it has-but clearly in others it has not.

The noble Lord, Lord Judd, also said that negotiations ought to include Hamas, and made some sharp remarks on arms sales. He criticised my right honourable friend and his colleagues for travelling through the Middle East and arguing both that there should be more democracy and that there should be an arms trade. He has to face the fact, as my right honourable friend said, that democracies have to arm. The question is whether they should be armed by Chinese or Russian weapons, which are in ample supply-they can produce all kinds of unregulated, dangerous and lethal weapons-or whether the legitimate and properly controlled arms exports of this country should continue to play a part. That question has to be answered before one denounces completely the arms trade of this country.

My noble friend Lady Falkner spoke, as always, with great feeling. She asked whether we could normalise relations between the Arabs and Israel in the right context. I believe that we can. The noble Lord, Lord Bew, put the point of view of the United States quite fairly, as I, too, have done. We do not agree with it, but now at least we understand where they are coming from. My noble friend Lord Tugendhat gave an eloquent plea to listen to the moderate voices of Israel-those who really want to secure the longer range security of Israel, rather than some of the more extreme voices that many of us feel are anti-Israeli, though they come from Israeli personnel.

I have mentioned the noble Lord, Lord Janner, who believes that Hamas are terrorists. I have stated the UK Government's view towards them. My noble friend Lady Tonge, who is immensely experienced in these issues and in the details, asked about Palestinian prisoners. We raise the issue continuously, particularly the very worrying concerns about underage and juvenile prisoners and how they are held. We raise them all the time with the Israelis and will continue to do so. The noble Baroness, Lady Deech, mentioned the virtue of the kind of approach outlined by the noble Lord, Lord Stern, the other day: to make enterprise and business the way we can see Arabs and Israelis sew themselves and work together again, rather than be in endless conflict. The noble Lord, Lord Palmer of Childs Hill, took the side of those who said, like the Americans, that the UN was not the best forum for the way forward.

I think I have covered everything, including the question from the noble Baroness, Lady Jones, about the Foreign Secretary speaking with the Americans. He does so all the time. I have now run out of further time, so will say only that we believe in a peaceful and safe future for Israel that is best secured through a peace with the Palestinians which can, in turn, lead to a peace with the entire region that will strengthen the stability of the region. That is our hope and intention; we have demonstrated it by our position in the recent vote, and we have demonstrated it by our continuous actions. We will continue to do so in order that we can move forward through the agonising difficulties and divisions which this great issue has produced again and again.

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