5.25 pm

Baroness Suttie (LD): My Lords, I start by apologising sincerely to the House for my late arrival to the debate this afternoon. In particular, I apologise to my noble friend the Minister.

The debate this afternoon has illustrated just what a complex, difficult and rapidly developing issue this is. As someone who has studied, lived in and worked in Russia over many years since the late 1980s, I will limit myself this afternoon to issues surrounding the context of recent events. That context is extremely important in setting out why western rhetoric following these deeply dangerous events is not always matched by reality. Clearly, Sunday’s referendum was not legitimate. It had a heavily rigged set of questions and was carried out in a true Putin-esque spirit of “managed democracy”. None the less, the scale of the result illustrates all too clearly the problem in Crimea.

Last week, Henry Kissinger wrote an interesting article on Ukraine in the Washington Post. He stated that:

“The test of policy is how it ends, not how it begins”.

Whatever our individual views about what is happening in Ukraine, I believe all noble Lords agree that we want a democratic, open and liberal Ukraine. We all want to see a Ukrainian Government who allow free speech, work to fight against corruption and speak for

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all Ukrainians—Ukrainian and Russian speakers, Tatars, Muslims and other minorities. However, we cannot successfully achieve such a Ukraine by forcing it artificially to decide between Russia and the West. To do so risks splitting the country and aggravating even moderate Russians.

As many noble Lords have already remarked, the situation in Ukraine is highly complex. There are families of Ukrainian origin living in Russia and Russian-speaking Ukrainians living in Ukraine. After over 70 years of the Soviet Union, the two countries are inextricably linked. For many Russians—including many liberal, anti-Putin Russians—Ukraine is not just any other neighbouring country. As several noble Lords have already remarked today, Kievan Rus is at the heart of Russian history. We should recall that Crimea was Russian as recently as 1954—in the lifetime of many Russians and Ukrainians. There remain many emotional and family ties, as well as, of course, the Black Sea fleet in Sevastopol.

One of the side effects of the end of the Cold War is that fewer people have studied Russia, its language, politics and history. It has been seen as less of a priority. As we have seen more and more Russians shopping in Bond Street and buying properties in Hampstead, we have tended to assume that it was all “getting better over there”. Sadly, the EU’s eastern dimension policy has not been as united or successful as it should have been. Our approach has been overly based on bilateral financial and energy deals rather than achieving a successful, united and holistic approach to Russia and its near neighbours. In particular, we have failed to deal effectively with the increasingly authoritarian Mr Putin with one clear and united voice. He has carefully exploited those divisions. We have such great financial, economic and, especially, energy interests with Russia that all too often over the past decade we have turned a convenient blind eye to some of Mr Putin’s increasingly authoritarian behaviour.

The situation in Ukraine is undoubtedly complex, but it is in the West’s best interest to have a stable, democratic Ukraine. That should not involve it having to become either Moscow’s or the West’s buffer zone against the other side. Ukraine must not become an excuse for hawks on either side to reignite the Cold War. Indeed, Ukraine could serve as an effective bridge from western Europe to Russia.

I believe that some errors were made in the early stages of this crisis. As a result, there is a risk of increasingly dangerous extremism on both sides of the political divide in Ukraine. For example, it was deeply insensitive and unwise of the interim Ukrainian Government to demote the Russian language immediately after taking power. From the start, they should have emphasised that they sought to represent all Ukrainians, including Russian speakers, Tatars and other minorities. That policy has now been reversed, but the damage has already been done in Crimea and eastern Ukraine. It has provided Mr Putin with the excuse that he needed.

Moscow, for its part, has clearly breached international law through trying to annex Crimea. Mr Putin has used the mostly non-existent threat against Russian speakers in Ukraine as an excuse for his actions. There can be little doubt that in the short term, this has given

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a boost to popularity back at home, although it should be noted—as my noble friend Lord Chidgey already has—that liberals, particularly Yabloko, in both Moscow and St Petersburg have expressed deep concern at Mr Putin’s response. Accepting the transfer of Crimea to Russia would set a very dangerous precedent—not least for the countries of the former Soviet Union and, in particular, Moldova.

I believe that we should concentrate all diplomatic efforts now on getting all parties, including Russia, focused on electing a democratically legitimate Government in Kiev on 25 May. Those elections must proceed on that date as agreed and they must be fair, free and properly and fully observed. Any attempts to postpone those elections should be resisted. Ukraine must be allowed to decide its own future. Work should also continue on providing economic assistance and support to fighting the, sadly, currently endemic levels of corruption and promoting judicial, political and economic reform in Ukraine.

There is no doubt that these will be challenging weeks ahead but when we look at how we want this policy to end we have to ensure that, at the end of this process, Moscow understands that if it wants to be a respected player on the world stage it has to put its Cold War-style behaviour in the past where it belongs. The EU, for its part, should work to build a genuinely coherent eastern dimension policy, one which works to improve democracy and could serve as a bridge from the EU to Russia and beyond.

5.32 pm

Lord Hylton (CB): My Lords, it is a pleasure to follow a speaker who has much long experience in Moscow. I well remember the Soviet invasions of Hungary and Czechoslovakia and the threats that were made in the last years of the old Soviet Union to what have now become the Baltic states. Nevertheless, in today’s situation, I suggest that we need to be calm and firm. We should work to prevent ill judged adventures which could have very serious consequences.

Ukraine is no banana republic, but rather a country with a population estimated in 2012 to exceed 45 million. It has, alas, suffered poor leadership and much corruption. Looking from the Russian point of view, one can understand their historic connection with Kievan Rus and with the adoption of the Christian faith. The victory at Poltava in Ukraine in the early 18th century marked the end of a major threat from Sweden. Today, many Russians have a strong sense of the near abroad and value having a base at Sevastopol for their Black Sea fleet. None of that, however, justifies attempts to dictate to their nearest neighbour, which has a clear idea of its own identity and, indeed, sought to establish independence between 1917 and 1920. As the noble Lords, Lord Chidgey and Lord Soley, have already mentioned, in 1994 the Budapest memorandum gave Ukraine full recognition and guaranteed its independence. In return, Ukraine gave up any ambition to be armed with nuclear weapons and indeed surrendered its Soviet arsenal. Three years earlier, Crimea had become an autonomous republic within Ukraine. In 2005, that autonomy was modified to provide a permanent share of power for the distinctive Crimean Tatars, who had suffered so heavily under Stalin.

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In the present situation, I suggest that we have to find ways for Russia to come back from rash adventures and leave aside any coercion while avoiding loss of face. I believe that the OSCE provides the ideal mechanism. This organisation and its companion, the Office for Democratic Institutions and Human Rights, stem from the Helsinki agreements of the mid-1970s. It is an intergovernmental body but not a military organisation. It is worth noting that its membership is far larger than that of the European Union. In the past the OSCE did good work in the Baltic states where, as we know, there are sizeable Russian minorities. It tried hard over many years after the civil war in Moldova, where alas things were not helped by having too many mediators.

What was shown in that case, however, was that a mediated peace process was fully compatible with a simultaneous analytical conflict-resolution process. The same combination could happen again in today’s circumstances—if possible, before they become too embittered. NGOs and local government could also help to implement any new agreements that could be reached. The OSCE has the great advantage that it already has observers on the ground in Ukraine, though they have not been allowed to enter Crimea. Seventeen member states are taking part in the monitoring mission. It is also fortunate that the current chairman-in-office of the OSCE is Swiss. I am glad to learn that he has already spoken directly with President Putin.

What would be an acceptable result? First, there should be a democratic Ukraine, able to negotiate its own relations with Russia and the EU. This might include special arrangements: for example, on dual nationality for Russian people in the eastern provinces, as indeed happens in Northern Ireland, and for the Russian language. Secondly, Crimea should be enabled to determine its own future, whether that might be independence or an agreed linkage with either Russia or Ukraine. A velvet divorce, on the lines of the agreed separation of the Czech and Slovak republics, would be a possible way forward. This is something quite different and distinct from the rushed referendum of last Sunday. It is essential to have sufficient time for any popular consultation. The issues must be fully explained, while the voters need time for thought before giving a considered verdict. All military or paramilitary pressure should be excluded. Independent observers should verify the process before, during and after the voting.

There are two well known principles in international law: the territorial integrity of states and the right to self-determination of peoples. Quite often those principles conflict and the art is to reconcile them without resort to violence. Here, religious leaders and other people of good will can help the politicians. Above all, the OSCE holds the key to the peaceful resolution of problems involving national identity and country.

I am a direct descendant of someone who survived the charge of the Light Brigade. That was not a good way to solve things. Do Her Majesty’s Government agree that the Geneva declaration of 2006, which was signed by 42 states, is still relevant? It argued against armed violence and on behalf of human security. In that spirit, will the Government use their best efforts to achieve agreed political solutions?

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5.40 pm

Lord Spicer (Con): My Lords, I imagine the noble Lord, Lord Hylton, is not a relation of the sergeant who got back at the end of the charge of the Light Brigade and asked his commanding officer, “Same again, Sir?”.

I shall be very brief. The West’s response to the outrageous annexation of Crimea by Russia has been twofold. The first has been to suggest—in fact now, to implement—some punishments, including the removal of trade in certain goods and today we have had mention of the closing down of some negotiations that have been going on on military matters between the West and the former Soviet Union. Secondly, there has been the call for more negotiations. I shall spend a bit of time on the negotiations point without further ado.

However, I want to mention one anecdote about the punishments. I was in Saint Petersburg two or three months ago, and I bumped into a British admiral who was rather irate, which admirals are allowed to be. I discovered why he was irate. He was the commander of the NATO naval force and was there with other NATO officers to negotiate a deal on British and NATO help with saving submarines, because the Russians had that disaster a few years before and we have the technology to help with saving submarines. On his arrival that day, he had been called by, I think, Putin’s office, but certainly by a very high person in the Russian Government, to say that the meeting was off. I am not quite sure who was punishing whom at that point because it was Putin’s office that closed down that negotiation. I pass that on as an anecdote.

On negotiations, clearly it is true that jaw-jaw is better than war-war, but what the noble Lord, Lord Solely, said is also true: unless it is done very sensitively and astutely, it could simply open up a Pandora’s box of further Russian activity. It is true that one does not have to believe in “peace in our time” to know that negotiations can be dangerous. If one is always on the back foot in negotiations and is always responding to the other side in a negative way, it can look defeatist and send wrong signals to rogue states, such as North Korea, Iran and so on. So there is a problem here.

I shall suggest one way in which we can overcome these problems and the difficulties we have in negotiations. Clearly, if we are going to negotiate, we want to do it properly. There are two principles in negotiation that need to be stuck with. The first is that we must be realistic. We have to accept that certain countries are within the Russian sphere of influence, and Ukraine is one of those countries. It is a buffer between the West and the East. We cannot describe it any other way. It is a divided country, and Crimea, as has already been said in this debate, has on the whole been part of Russia. These are facts of life that we have to accept in any negotiations. We have to be realistic.

The second, and much the most important, point is that we have to be on the front foot in these negotiations. We cannot just respond to other people’s actions and proposals; we have to have our own proposals. This is extremely important, because otherwise we will always be on the back foot and will be defeatist and retreating backwards from other people’s propositions.

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One of the really interesting things about the debate so far is that a number of proposals have come forward. There is my noble friend Lord Howell’s proposal for a democratic and stable Government in Kiev. There is another proposal for trying to get some stability in Crimea. My own view, for what it is worth, is that we will have to have a much more devolved Ukraine. I cannot see how the present Ukraine can carry on in a stable way. It has got to be more devolved and possibly even split. The West is going to have to take a view about this. It will be terribly important for those Governments to have a view in order to sit down and negotiate. We cannot just go in hoping for something to come out of the negotiations and retreat backwards the whole time in the way that has largely been the case up to now.

I say strongly to our Front Bench that it must work out what we want out of these negotiations. There have been all sorts of suggestions coming out of this debate, which has been very fruitful. I hope that the Government will start taking up some of these views and coming forward with their own propositions in these negotiations so that we are not on the back foot, looking defeatist and having the kind of repercussions that the noble Lord, Lord Solely, wisely warned the House could come about.

5.46 pm

Lord Lea of Crondall (Lab): My Lords, the State Duma in Moscow has just cancelled a delegation from our All-Party Parliamentary Russia Group a month from now. It so happens that I chaired the previous meeting here. Before we started the agenda, the formidable lady chair of the Duma asked me point blank, “Do you think we are a European country?”. I thought for a second and said, “Well, of course: Chekov, Tolstoy, Pushkin, Shostakovich, Stravinsky”—you know, just to show how cultured I was. However, I wondered whether I should add, “Actually, no, you are not. Why are all eight of you from the United Russia party? You are not a normal European country, because we have multi-party democracy”.

The schizophrenia in Russia is very general. Putin himself wants to be acknowledged on the world stage, such as at the G8—the Olympics is an example par excellence—and not to be a pariah. There are multi- national economic facts of life—energy, whatever—and the huge role of shipping across the northern sea route from the Far East to Europe, et cetera. That internationalism is in sharp antithesis to the other half of his brain, which is demotic nationalism.

We have to try. Somebody mentioned having regard to people’s sensitivities. That is a very wise thing to say. A number of the points of the Minister, the noble Baroness, Lady Warsi, have great validity. Some other key points and perspectives had certainly not been made until the debate got under way. It is time to try to be constructive, as many people have said; it might sound facile. The noble Lord, Lord Anderson, asked, “Why not have guarantees for the Russian minority as part of the solution?”. Yes, but we both made mistakes, did we not? It was only recently that the new Government did exactly the opposite on the question, which was highly provocative.

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I say to the noble Lord, Lord Hylton, that this is not the time that Russia should be thrown out of the OSCE. The Secretary-General of the United Nations could not chair a meeting at the moment because he is defending the territorial integrity of member states. However, that is highly nuanced in the case of Crimea, and I will add my two pennies on that.

I very much agreed with the noble Baroness, Lady Suttie—I am sorry if I pronounce her name wrong. Yesterday’s proposals by the Russian Foreign Minister were rejected out of hand on the grounds that we would absolutely never accept the idea that Crimea could be either independent or part of Russia, because it must be part of the territorial integrity of Ukraine.

I also very much agreed with the noble Lord, Lord Howell, who made an excellent speech. I will qualify two points from my understanding of it. I very much agreed when he said, “Never use the word ‘never’”, but I will pick up the question of elections. I have now raised three times in the House the unsustainability of the constitution of Ukraine, which it has had for a long time. It is 50:50, a bit like the two sides in Northern Ireland, which I have mentioned. In that situation you cannot have elections in which the winner takes it all—51:49—and you certainly do not then arrest and imprison the leader of the Opposition on charges of treason. We do not want later this month—is it in May?—those sort of elections. The cart is being put before the horse as regards constitution-making.

On the talks in Northern Ireland, I am not saying that Dublin equals Moscow or anything but religion defines the situation. The right reverend Prelate the Bishop of St Albans spoke about the two types of Orthodox in the east and the west. We can also look at a bit of history. Many noble Lords have mentioned history, but I will add one point. Churchill agreed with Stalin and Roosevelt at Yalta—aptly enough—in 1945 that the Ukrainian, Belarusian and Russian SSRs would become members of the United Nations, but that was rather illusory until after Gorbachev, perestroika and the collapse of the USSR. However, what was done in Yalta was to shift Poland to the west, to the Oder-Neisse line, and to shift Ukraine’s western border to the left-hand side—to the west—which has created the exact balance which we now inherit. Galicia—which also had a Roman Catholic element, going back to the Austro-Hungarian empire—became part of Ukraine because of the shift after Yalta in 1945. We therefore have a country which I will not say is slightly artificial, as that would be a very bad thing to say. However, in historical terms, as we have historical memories, it is a relatively recent country. Perhaps that is why people are all so hypersensitive.

Crimea is in a very special position. I remember hiring a car not so long ago in Simferopol, staying in Yalta and going to Balaklava. I got to the esplanade in the middle of Sevastopol and got in a launch. I paid someone some roubles and he showed me around the Russian Black Sea fleet. Only 50 yards away is the Ukrainian Black Sea fleet. You see monuments all around for all the wars that Russia fought—three major ones in defence of Sevastopol. Tolstoy was wounded there, and much of War and Peace, in terms of what it is like to fight, is from Sevastopol in 1855.

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That novel is based on Sevastopol in that sense; it is almost learnt by heart, although that might be difficult, by every Russian schoolchild. The heroic defence happened not only in the 19th and early 20th century but as recently as 1941 and 1942.

In the centre of Sevastopol by the esplanade is an administrative building with a Russian flag on top of it. That has been true for a long time. As I understand it, the deal implicitly is in the treaty to have the sovereign bases, just as we have in Cyprus—that is, the naval bases in Sevastopol. But that treaty runs out in 2018, and I think that Putin has that in mind. All the Ukrainians whom we met in Kiev said, “Of course they’ll have to hand them back to Ukrainian control—we’re not going to renew that treaty”. Well, I do not need to teach anyone to suck eggs about the problem of access through the Dardanelles. Of course, Russia could build another base further along to the east, but I think that it is very committed to Sevastopol, almost as much as to the memory of Stalingrad in recent times.

Finally, I echo what the right reverend Prelate the Bishop of St Albans said, that the Greek Orthodox missionaries first landed in Sevastopol—I think that I am picking up the point correctly—and, incidentally, brought the Cyrillic alphabet. Anyone who goes to Athens and gets the hang of the Cyrillic alphabet does not have too much problem trying to understand the road signs in Crimea, and it is true of the whole of the ex-USSR; everyone understands Cyrillic. So this history is terribly important.

What we have to do now is to put a lot of eggs in the basket of how a new constitution would actually work. We have to find a form of words that does not say “Never” about Ukraine but tries to acknowledge that there have been mistakes on both sides—and I have mentioned a couple of them. We have to find a constitutional formula where there is buy-in from both main parties in the ethnic or religious sense. I do not dissent from everything that the Government and the West are doing at the moment, but my instinctive reaction, for what it is worth—and I would be interested to hear the Minister’s comment on this—is that we have to do what we can to give Putin an excuse not to do something stupid in the Donbas.

We must not be too provocative. Although people may be killed in a very tragic situation—take my analogy with Northern Ireland—it does not change what you then try to do. We must recognise the rights of the two sides to be part of a united Ukraine, even with a question mark over Crimea, and ensure that Russia comes to the table. I think that Putin is now looking for that. I may be wrong but that is my instinct.

6 pm

Lord Goodhart (LD): My Lords, I want to speak briefly on this occasion and to concentrate on Crimea. We need to study the past of Crimea as well as its recent features.

Crimea has been an important Russian district ever since the great Queen Catherine secured it in the latter half of the 18th century. In the 1860s, as we all know, a Russian army was fighting attacks by the British and French armies in Crimea. After that, Crimea remained

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an important part of Russia. Crimea gathered important places—think of Simferopol, Sevastopol, Balaklava and Yalta, all of them full of Russian people and often Russian buildings. Yalta was, and is, a very special city. For example, it was for several years the home of Chekhov, the greatest Russian author of his day, and was the summer home of the Russian tsars until Tsar Nicholas II and his wife and children were taken away and murdered by the Bolsheviks. In 1944, Stalin secured in Yalta a conference with Roosevelt and Churchill to plan the end of the war against the Germans. None of this was part of Ukraine. Crimea was not treated as part of Ukraine until 1960. At that time, Russia, Ukraine and Crimea were parts of the Soviet Union. It was, I believe, at that time assumed that the Soviet Union would continue to be permanently in charge of Russia and Ukraine.

It was not until some years later, in about 1992, that the Soviet Union ceased to exist. Crimea remained in Ukraine. I believe that this was a mistake and that Crimea should have been made either an independent state or a section of Russia. I do not want the people of Crimea to be forced into abiding by the decisions of the inhabitants of the rest of Ukraine because they are very different. That being so, I believe that we should not do anything to restore Crimea to membership of Ukraine. The Crimean people should not be forced back into Ukraine. Crimea and Ukraine are different and should be recognised as separate places. I agree that there should continue to be Ukraine areas, except in Crimea. The majority of Ukraine and the majority of the citizens of Crimea should be kept separate. If that happens, things will go better, as they should. What we have seen in the past few weeks is very serious and we have to be careful about how we handle it. We need to recognise that what is done now in Ukraine is not necessarily the same as what should be done in Crimea.

6.05 pm

Lord Cormack (Con): My Lords, my noble friend Lord Goodhart makes his points persuasively and briefly, and I do not disagree with much of what he said. However, at the same time, no one can condone the manner in which recent events have been conducted by the Government of Russia.

Nevertheless, I would like to set my remarks in a personal context, if your Lordships will forgive me. I sit here on this Bench every day and look up at the Barons of Magna Carta—we will be celebrating them next year—and I think of how long it took from 1215 for us in this country to have a fully-fledged democracy. I also look up at the armorial bearings on one of those windows, on which the words, “Be mindful”, stand out. We need to be mindful of the history of the post-war world.

When I was first elected to the other place in 1970, the Soviet Union was a tyranny that dominated the whole of eastern Europe. I well remember my noble friend Lord Janner of Braunstone—I deliberately call him my noble friend—coming to me and persuading me to take on the chairmanship of the campaign for the release of Soviet Jewry. We worked hard, sometimes unavailingly, for those people who did at least have a door marked “Exit” if they could be given a visa to get

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out. I remember an instance when my noble friend and I tried to send a prayer book to a young man who was celebrating his bar mitzvah. We had it signed by Mr Wilson—as he then was—Prime Minister Heath, and some 300 Members of the House of Commons. It came back; not only was it not admitted, not only did the young man then know nothing about it, but my noble friend Lord Janner and I, and the other members of the committee, including my noble friend Lord Dykes, were not allowed to have visas to go to the Soviet Union. We were emphatically personae non gratae.

I had the great privilege, 20 years later, of taking part in an Epiphany communion service conducted by Father Ted Hesburgh, who had been the chairman of President Kennedy’s Civil Rights Commission, in the hotel in the Kremlin which had always previously been given over to visiting Soviet-bloc country delegations —Prime Ministers of East Germany and so on. During that visit, Mr Gorbachev’s chef de cabinet received from us a Bible that was symbolic of a million that he had agreed to accept to be distributed around the Soviet Union.

I relate those two separate anecdotes to show the progress that was made while it was still the Soviet Union after the coming to power of Mr Gorbachev—the man with whom Mrs Thatcher famously said she could do business, and did. There is no democratic infrastructure or democratic history of what we now call Russia. The Soviet Union was of course dismembered within a couple of years of our giving those Bibles. A superpower ceased to be and the Russian Federation was created. The Baltic states, Poland and Hungary—it was the situation in Hungary in 1956 that brought me into politics—all became independent nations and Czechoslovakia then split into two.

That was extraordinary progress and it had one effect in Russia. People who had been part of a superpower no longer felt themselves to be part of a great nation. We have to recognise that, for all his recent behaviour, Mr Putin gave back to the people of Russia a degree of self-respect. That is something that we should not set aside. I am not here to act as an apologist for Mr Putin or to justify the way in which recent events have been conducted, but I would say to your Lordships that we in the West, for all our tradition of developing democracy, have not always got it right. We have done things internationally, even in recent years, which have been questioned, and we should bear that in mind. We also have to bear in mind that a peaceful and prosperous Russia is essential to a peaceful and stable Europe. We must also remember that in recent history—I go back no more than a couple of hundred years—the concept of the sphere of influence has been recognised in international diplomacy. One has only to think of the famous Monroe doctrine of 1823.

It is against that sort of background that we should be careful. I am not saying that we should not apply certain sanctions but I am saying that, frankly, we have got off on the wrong foot here. We could have seen this coming—as a lot of us did—and a message should have been conveyed that it was crucial that the sovereign independence of Ukraine should be recognised, but it should also be acknowledged that Russia had its own legitimate interests in that part of the world.

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The noble Lord, Lord Soley, in a very perceptive, persuasive and interesting speech, referred to the tragedy of Russian history. You have only to go to Moscow and see the monuments to where the German tanks were stopped to realise what the Russians went through. Yes, of course, they inflicted terrible things on others afterwards, for which they were rightly condemned, and we all rejoiced when the ghastly Berlin Wall came down and when the nations that I mentioned became free. I said a moment ago that it was Hungary in 1956 that brought me into politics, and it was. I shall never forget the issue of Picture Post which had on its cover the words “Cry Hungary!”. It was full of terrible photographs of what the phosphorus shells fired into Budapest by the Russians had done. We all remember what happened to Imre Nagy, the brave man who tried to stand up, just as we remember—and I had the privilege of meeting him—Alexander Dubcek, who 12 years later in Czechoslovakia tried to stand up.

Much progress has been made since then. We have, for all its imperfections, a free Europe. Many of the countries that were subjected to Soviet domination and tyranny are now members of the European Union—which is why I rejoice at the Union and will fight and fight to keep it—and most are members of NATO. I understand why there is a certain degree of concern and diffidence about seeing Ukraine become a member of the European Union and of NATO. Although I would like to see it allied to both, we have to recognise that it is not just a simple matter. Most of all, we have to recognise that we have a duty not to escalate the situation. We have a great responsibility resting on us for what we say in this Chamber today. I would hate to think that anything said here today encouraged a mindless bellicosity that could be only inimical to true freedom, peace and stability afterwards.

Yes, there has to be mutual recognition. I hope that there can be a pause, that the elections on 25 May can be properly supervised, and that the Government elected—it is only an interim Government at the moment—in Ukraine will be fully recognised. I hope also that there will be a role for Ban Ki-moon. We pay lip service—very often, it is only lip service—to the United Nations but if ever there was a case for the Secretary-General of the United Nations to seek to call together those who are at odds, this is it.

We must be under no delusions. The Baltic states are members of NATO. An attack on one member of NATO is an attack on all members of NATO. History does not repeat itself but it teaches us lessons and we should be mindful of what happened 100 years ago when people did not want to go to war. For corroboration of that, one should read Professor Margaret MacMillan’s recently published brilliant book, The War that Ended Peace. Although it sounds unthinkable, it is not utterly impossible that we could drift into a situation where the brinkmanship that took us almost to war in 1962 over Cuba could place us in a very parlous position.

I beg my noble friends on the Front Bench and, through them, the Prime Minister and the Foreign Secretary to do everything possible to establish a constructive dialogue and to recognise that the world cannot be a safe and secure place if there is continuing animosity and even cold hostility, as there was during

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the Cold War, between Russia and the nations of the West. To connive, however unwittingly, in the creation of that sort of situation in a world that is going to be increasingly dominated by the great power blocs of China and India as the 21st century progresses would be a disservice to our own continent and nation, and to the civilisation of which I hope we are all proud to be members.

There should be firmness but also caution and calmness. Let us remember that Mr Putin, for all his faults—we all have plenty of those—is not the devil incarnate. We must not strive to try to make him appear an isolated figure who becomes the devil incarnate.

6.19 pm

Lord Kerr of Kinlochard (CB): My Lords, I begin with a tribute to the speech made by the Minister, which I found extremely informative. I thank her for maintaining her tradition of keeping the House well informed as this crisis develops. I also agree with many of the things she said, particularly what she said about the role of the Prime Minister at the European Council 10 days ago. The constructive role he played was greatly appreciated, particularly in Poland.

I cannot claim any particular expertise on Ukraine. It is a very long time since I lived in Russia. I lived in Moscow many years before the noble Baroness, Lady Suttie, lived in Russia and probably many years before she was anything more than a gleam in her father’s eye, but I knew Kiev and Crimea quite well back in the 1960s. I know Kiev a little more recently, but there are many noble Lords in the House with more expertise than me. I will therefore approach the issue by trying to devise some principles.

The first principle that I think the British Government are acting on—it is very important to keep it in mind—is that the aim of policy should not be to punish Russia but to help Ukraine. Although helping Ukraine does of course mean direct support and assistance, it also means deterring Russia from continuing down its present course. I do not think that that amounts to reckless bellicosity. Provided we ensure that all our policies are designed to assist Ukraine, we will not go far wrong.

There are three traps that policy needs to avoid, and I think British government policy is avoiding them. The first is the pipeline heresy, which was well exploded in an excellent speech by the noble Lord, Lord Howell of Guildford. Pipelines mean that one has tied suppliers. The Russians, by choosing to invest in pipelines rather than LNG, have ensured that we have leverage over them. In the medium term, we, as the noble Lord, Lord Howell, said, can buy more Norwegian or Algerian pipeline gas. We can get LNG that is freely available, at a price that will go down, from Nigeria and the Gulf because there is no market in America any more thanks to fracking. If Gazprom cannot sell its gas to us, it cannot sell it anywhere because it has no other market to supply, so Europe has no need to cringe because of its energy deficit.

It must of course work to correct that energy deficit: the noble Lord, Lord Howell, was right again. To some extent, it has done so, compared with the 2008

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crisis. Slovakia, Hungary and Poland are less exposed now than they were because the pipelines previously flowed in only one direction and they now have reverse flow from west to east. We need be less inhibited than we were at the time of the Georgia crisis in 2008.

In the long term, there is no doubt that fracking means that the United States will be exporting LNG. There is clearly a need for many more gasification plants. It is particularly astonishing that Germany does not have one yet. However, in the medium term this is not a big problem, and in the short term we have had a warm winter in Europe and stocks are high.

Coal is phenomenally cheap because Appalachian coal has been driven out of the American power generation market by natural gas. Therefore, it can underprice Russian coal. Forty per cent of coal in this country still comes from Russia, but it does not have to. We could, if we wanted, reopen those contracts. I am not saying that we should do these things: my point is simply that the pipeline heresy is a heresy. We do not need to feel that Gazprom controls the EU’s policy.

The second heresy is to believe that EU sanctions set a ceiling on what we, the French, the Germans or the Poles could do or threaten to do to help Kiev. They do not set a ceiling; they set a floor. A convoy does not need to move at the speed of the slowest ship and only as far as that ship will go. There is an argument that the UK and France should think about going further and faster because we are signatories to the 1994 Budapest memorandum, which has been described and discussed already. However, I will make the point that in 1994, Ukraine’s nuclear arsenal was the third largest in the world. It was bigger than those of the next three, the French, the British and the Chinese, put together. All that was removed as a result of the Budapest memorandum, so I do not think that our policy in the present crisis should be determined only by the need to support and help our friends in Ukraine. We need also to think about how to sustain the policy we have had for many years on non-proliferation. It will be harder to persuade the near-nuclear powers not to go for warhead and missile development and weaponisation in the future if it is seen that the guarantees that the Ukrainians certainly think they got in 1994 are worth nothing.

The third heresy is the shoulder shrug which says that Ukraine is a basket case and nothing can be done. Ukraine is still the world’s second largest grain exporter. The country is phenomenally rich in minerals and in largely unexploited hydrocarbons. It is, as I think the noble Lord, Lord Howell, also said, natural fracking country. No one is doing it yet because no one invests in Ukraine. That is because Ukraine has had the bad luck to have five successive corrupt kleptocracies. Twenty years ago, the per capita wealth of Ukraine was on a par with that of Poland. Today, Poland’s per capita income is four times that of Ukraine. It is a rich country that has been very badly governed, and of course it is bankrupt. Some 30% of its budget is spent on debt service, so no wonder it cannot pay its bills. However, with a good Government that could change very quickly, which would be in everyone’s interest, including Russia’s.

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What should we do? I have four thoughts about this. First, it is obvious that generous emergency aid should be made available now. It should come from the IMF, the EU and bilaterally from the Americans. I see that there is a Bill in Congress for $1 billion; I hope it gets through. That is needed to get the country through the six months that will see the parliamentary and presidential elections, the new constitution and a new Government. In my view, we are talking not only about capital aid—much of which can be loan money because we are lending to a country that is potentially rich and will repay—but about technical assistance, particularly in the area of juridical, legal and constitutional reform on issues of governance, where I think there is a particular role for this country to play.

Secondly, the Russians must be deterred from disrupting the six-month process that the Ukrainians have set themselves. As the noble Baroness, Lady Suttie, said, Kiev must continue to be statesmanlike and conciliatory about language laws and minority rights, and not make the terrible mistake that arose briefly on the language laws. The world’s eyes and ears need to be on Donetsk, Kharkiv and Odessa. It was easy for the Russians to create facts on the ground in Crimea because the world was not watching and the OSCE monitors were not let in. The Kiev Government want them in now, so we, the EU, the OSCE and all those who are concerned for the future of Ukraine should be responding to that. We need observers on the ground to make sure that false facts are not created.

Thirdly, there is a need for a dialogue with Moscow about whether its current zero-sum game approach, as shown in Putin’s speech today, is really in its interests. I strongly believe that, as the noble Lord, Lord Howell, said, a prosperous Ukraine is in the Russians’ interest. I do not think it is in their interest that their near-abroad—the Kazakhstans, Turkmenistans, Azerbaijans, Armenias, Georgias and Moldovas—should see Moscow as threatening and overbearing. However, that is how Moscow is seen today as a result of what has just happened in Crimea, particularly in the Muslim republics. The reactions of the Tatars in Crimea were predictable, and their fate is of concern to their coreligionists.

The Russians also need their EU markets, so the points I made earlier about sanctions are relevant. They need the inward investment that their action in Crimea will certainly now deter. We need to encourage them not to believe their own propaganda: Ukraine is not about to join NATO and the US is not about to deploy missiles on the Russian border. In fact, NATO membership is not on offer and has not been on offer for a considerable time. It was US policy for a time to offer it, but the European allies did not agree. As far as I know, no British Government have agreed, and it is not British policy now that Ukraine should be invited to join NATO—I hope the Minister will confirm that. The Russians maintain that it is. It would be a great pity if it was, and it would be a mistaken policy, for reasons that have been mentioned in this debate. However, I do not think it is the case, and that needs to be made clear.

Being slightly daring now, I should like to go a little further and make what is perhaps a more constructive suggestion. Some recent statements from Moscow,

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including one yesterday, seem to imply that Russia would like a status for Ukraine comparable to that achieved by Austria with the state treaty in 1955. If that were genuinely what a freely elected Ukrainian Parliament wanted—I have no idea whether it is or might be—and if the Russians would genuinely back off, as they did in Austria in 1955, and could convince Ukraine that they would respect a Ukrainian state treaty, just as Russia respected the Austrian state treaty and not as it treated the Budapest memorandum, then it seems to me that a very interesting negotiation is possible. Of course, it all hangs on what the Ukrainians want. They cannot have access to the alliance but they could have some other form of collective security guarantee, perhaps more binding than the Budapest memorandum has come to be.

Lastly, we need to remember our other friends in the region that are now feeling threatened. For Moldova, the parallel between Crimea and Transnistria is disturbingly close—the Russians have 2,000 troops on the ground in Transnistria, and the illegal referendum has already happened. It happened in Gagauzia on 2 February and, astonishingly enough, produced a majority in favour of closer links with Moscow and no move towards the European Union. Russian Deputy Prime Minister Rogozin has already warned that Moldova will lose Transnistria if it continues to move towards the EU. So far, Moldova’s nerve holds, but where are our observers? Where is our presence on the ground in Moldova?

What about the Baltic states? When they suffered, in 1940, precisely the same fate that has now befallen Crimea, the United Kingdom, greatly to its credit, never recognised their incorporation into the USSR. Most other countries did, but we have never recognised it. We maintained the embassies of the three independent republics in London right through until the collapse of the Soviet Union. Now they are our allies and are in NATO. They have a deep bond with this country because we did not let them down the way everybody else did. It is really quite important that we should be seen to be standing by them again lest President Putin mistakenly think that Article 5 of the Washington treaty is a dead letter. Foreign Minister Steinmeier was in the three Baltic capitals 10 days ago. I hope that we will follow.

The noble Lord, Lord Cormack, spoke of the Monroe doctrine. Alas, the Brezhnev doctrine is probably more relevant. I do not like it at all. I do not believe in spheres of influence. I do believe that democracy and self-determination must take precedence. That is why I think our policy should rest on the central pivot of: what can we do to help Kiev and others who currently feel threatened?

6.35 pm

Lord Balfe (Con): My Lords, I begin by recording my interest as a three-time election observer in Ukraine, as well as visiting on a number of occasions and heading up a programme run by the European Parliament Former Members Association called EP to Campus, which sends former Members to universities. We have sent quite a few to universities in Ukraine, particularly in Kiev and Donetsk.

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The noble Lord, Lord Anderson, is not in his place. I reflected at one point that sometimes pleasant consequences come out of tragic situations. If the Conservative group ended up in the EPP, I would regard that as being an extremely good solution to us not having anywhere to go at the moment, but we will see about that in due course.

As I mentioned, I have visited Ukraine, including Crimea, on many occasions. It has always been very clear to me that there have always been huge tensions within the different communities in Ukraine and Crimea. Seven or eight years ago in Crimea, when I spoke to Crimean parliamentarians in the autonomous parliament, a number of them, even at that time, expressed great regret that they were in Ukraine at all. The idea of joining Russia has not come up in the past few months; it has simmered away ever since, as one parliamentarian put it to me, the unexpected and somewhat cavalier act of Nikita Khrushchev in removing Crimea from Russia.

What we have to look at going forward, without in any way accepting last Sunday’s referendum as being fair, rational or giving proper opportunities for debate, is a way for the people of Ukraine to express a preference for where they want to be. We must also realise that we have our press in this country but my son, who is living in Moscow at the moment, describes it as Russia trying to stir up tensions in order to create a pretext for further involvement in eastern Ukraine, with the Russian media operating as an anti-western, anti-Ukraine propaganda machine. In other words, they are building up the fires. But there has also been some building up of fires in Washington and in places somewhat closer to home.

The referendum was certainly not conducted in a satisfactory way, but I do not think it becomes a Parliament that is about to give an independence vote to Scotland to say that we cannot devise a formula whereby the people of Ukraine can express their preference for where they would wish their Government ultimately to be based. As the noble Lord, Lord Howell, said, there are many possible solutions on offer. Our job is to look forward and to try to be a facilitator of those negotiations, not to be partisan but more to follow the line of recent statements by the former German Chancellor, Gerhard Schroeder. He said that the EU has to take some responsibility for the current situation in Ukraine because we have rather polarised it. It is either an association agreement or a customs agreement with Russia. We have to come to a solution which is somewhere in between those two. Moving forward has to be done in a both-ways scenario, as our colleague Mr Schroeder says.

I counsel us to be cautious in the way that we deal with all our relations with Russia. To the people of Russia, what happened in the 1990s was not exactly the triumph that we see here. Many people in Russia do not look on either Mr Gorbachev or Mr Yeltsin as great figures; many of them look on those two people as being less-than-perfect defenders of what they regarded as their pride and their interests. We need to keep that in mind at all times when dealing with Russia.

We also need to look at money-laundering, which was mentioned by the noble Earl, Lord Sandwich. We cannot be unaware of the huge amount of eastern

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European money that is in London. When I think of my late mother-in-law in her late 80s trudging down to the bank with her passport to show that she was not money-laundering and I then look at the huge amount of money coming into this country, into flats and property, and basically depriving Londoners of the ability to have somewhere to live, I wonder whether we are concentrating on the wrong end of that particular spectrum. In some people’s view—and it would not be far from mine—we have also aided the plundering of the wealth of eastern Europe, which has come in here, has done marvels for our balance of payments but has impoverished a lot of people in eastern Europe.

One final problem that I want to deal with is that of corruption in Ukraine. As the noble Lord, Lord Kerr, mentioned, it has existed under the past five Governments, and it is sad and endemic. I have a number of people whom I would count as friends in Ukraine. Most of them are in what we could call the middle classes: they are doctors and professionals, many of them working in the public sector. The Ukraine Government know that their public servants cannot live on the wages they are paid. A Russian word which is widely used in Ukraine—I hope the noble Baroness, Lady Suttie, will forgive me, because my pronunciation is probably awful—is blagodarnost, which means a payment in gratitude; in other words, a bribe. One of my friends who is a doctor would say that she could not live on the salary paid to her by the state. She operates a public clinic for one and a half days a week, and for the other three and a half days, with the open connivance of the Ukrainian state under a variety of Governments, she accepts under-the-counter payments for priority. She runs a sort of Nuffield health service in the Ukrainian medical service. This is not unique; it is a problem which the Ukrainian authorities have got to overcome, because until they do so there will not be investment. While a judge can be bribed to deliver a corrupt decision that will take all your investment away—and there are plenty of examples of people’s investments being corruptly confiscated by court decisions—and until you can get a rule of law that guarantees the sanctity of investment, people will not invest. This is a major problem that Ukraine has to tackle, and it is a problem that goes right back to the Kuchma Government. We can say that the President just out of office, Yanukovych, was corrupt, but he was only following a long pattern. After all, Mrs Tymoshenko was known locally as the “gas queen”. This problem has to be tackled.

That is why we must have a certain amount of humility. One of the things about this debate has been the number of times that the European Union has been mentioned. If anyone believes there would be any future for Britain outside the European Union in influencing Europe, let them read through this debate. I do not think that a single noble Lord even intimated that we would have the same amount of influence outside the European Union. Let us join with our EU partners in trying to mediate between the legitimate interests of a lot of disparate players. We have a role to play as part of a wider European polity. I hope the noble Lord who replies to the debate will be able to assure us that we will fulfil that role.

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6.45 pm

Lord Alderdice (LD): My Lords, my noble friend the Minister had to leave for a few minutes and just spoke to me. Even in her absence, I want to pay tribute to her opening speech, which was extremely helpful and certainly laid down the approach that the Government are understandably taking.

Many other noble Lords in this debate have pointed out that what the President of Russia is doing is at worst illegal but certainly running roughshod over the wishes of people and the security and stability of the wider region. I would not add very much to the debate if I simply repeated those kinds of sentiments. Instead, I will take a different approach but I want to make very clear in doing so that, while I seek to understand some of the mistakes that we have made in the West and some of the understandings that Mr Putin and his colleagues have in the East, I do it not in any sense to excuse what he is doing but because, if we do not understand it a little better, we may continue to make even worse misjudgments than we have done to date. I rather suspect that some noble Lords will find some of the things I say uncomfortable and maybe even disagreeable, including colleagues on my own Benches.

First, it is extremely important for us to be clear about the difference between tactics and strategy. We are debating the question of Ukraine and the particular situation with Crimea. This is about a tactic of Mr Putin’s, not a strategy. The strategy is a wider issue. I have not heard much being said—except perhaps by the noble Lord, Lord Soley—about the wider approach that Mr Putin is taking and what drives him. I will come back to that in a minute.

On the tactical question of Ukraine and Crimea, we need to be very honest with ourselves. For example, when noble Lords say that it is for the people of Ukraine to decide their future democratically, it is manifestly clear that the people of Ukraine are not of one mind. The problem is that they are absolutely split down the middle, so democracy as we talk about it simply will not work. That is part of the reason we have this problem. It is not going to work, so let us not use phrases like that, which might be very reassuring in this Chamber but are meaningless in the real world outside. One of my noble friends talked about how important it is to be responsible in this Chamber because things that are said here might do damage outside. There might be some element of truth there but, frankly, I do not think many people in Russia listen to this Chamber. It has very little relevance to most of them and the way they see things. The influence it has is modest in our own country and even more modest more widely.

I heard a lot said—very sensibly, rationally and thoughtfully—about the economic issues and the energy drivers. Those are not the things that drive people in situations of conflict—otherwise we would never get into wars. In wars, everybody loses: economically, socially and in every other way. Wars do not come about because of some kind of weighing up of the calculus of economic benefit. When I listened to a number of things said about energy, trade and economic sanctions, my first thought was that that will not make any difference to Mr Putin and his colleagues because

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they do not make judgments on that basis. They make judgments on the basis that they believe that their great country has been humiliated and set aside by the West for a long period and they are trying—successfully —to fight back against that. That is the driver, not the economy.

The speech by the noble Lord, Lord Howell of Guildford, was, as always, excellent. One thing that he pointed out was the interconnectedness of everything. He has often rightly drawn our attention to that. That makes it very difficult to make economic sanctions work, because there are always ways around them, especially if you have an enormous country and other countries, including other members of the Security Council, prepared to play ball with you.

Let us look at the attitude of Mr Putin. It is always important to know your enemy to understand what you are dealing with. When we talk about the war in Afghanistan, we think about our intervention when we were there—at least, the most recent one. Russians think of the previous Afghanistan war, the one in which we backed the mujaheddin, sending huge amounts of weapons and materiel—and backing Osama bin Laden, of course—in order to get them out, one of the last great humiliations at the end of the Cold War. I may be wrong, but I perceive that Mr Putin is riding on the back of a nationalist tiger and saying, “We’re going to put this right in various places”. I could see it in the quartet dealing with the Israel-Palestinian problem when, for all the loud talk coming from the UN, the EU and the United States about who would talk to whom, Russia was happily talking to Hamas and Hezbollah all the way through. They just ignored what the other three said.

When we came to Syria, particularly after the intervention in Libya, it was absolutely clear from the beginning that Mr Putin was saying, “This is my red line. And, by the way, I am going to stick with mine. Now let us see what you do with yours”. What did we do? We drew lines in the sand, which is very convenient because you can always draw more lines in the sand and rub the other one out with your foot. The same mistake has been made with regard to Crimea: saying that this or that will never happen. I do not think it will be much reassurance to say that we stuck to our view in regard to the Baltic states and, three generations later, they got their freedom. That will not be much reassurance either to people in the Baltics now or to anyone else who might reasonably be fearful. Why? Because now we do not make much of a difference.

I come to the European Union. I am a strong supporter of the European Union, but I remember many arguments with some of my Liberal colleagues over the question of widening or deepening the Union. In my view, you could either deepen it and make it a real political Union—at that stage, I was very keen to do that and have a Europe of the regions rather than a Europe of nation states, and I still think that it may well have been possible—or you could widen it and make it in effect a glorified free trade area. My belief was that if you tried to do both, you would make for disaster, and I think that that is what has happened. We will not talk about the economic aspects of it, but the political aspects are that we have allowed the further widening of the European Union and encouraged

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others to join it because we saw it as a democratisation of the east and of the south of Europe and beyond, but at the same time many of us who supported that were talking about the importance of developing a foreign and security policy and a defence posture. How on earth could that have been seen by Russia as anything other than bringing forward military, foreign and security policy closer and closer to its borders? Was it ever going to be accepted?

Lord Lea of Crondall: I am most grateful to the noble Lord for giving way, but if you take the case of Serbia and Kosovo—and it is true of many countries, surely—the Copenhagen criteria and other criteria, including the economic criteria for joining the EU, have been prized and highly sought after. That is not just skin deep; that is strategic—to use the noble Lord’s word—thinking. I ask the noble Lord to reflect on this idea that widening has had no real impact and not been a proper function of the European Union. I disagreed with Jacques Delors on this very point: I believe that widening and deepening have actually gone together.

Lord Alderdice: My Lords, that is precisely the problem which I am identifying. If we try to widen it out to states that Russia sees as being within its purview and at the same time insist that what we want is not merely a trading bloc but a political union with a common foreign and security policy, and with defence implications down the line, how could Russia see that other than as more than an economic free-trade and democratic area? It could only be perceived as a threat. We are reaping some of the problems of that approach.

We are at a dangerous place if we become more aggressive and at a dangerous place if we do not. I am reminded a little of the problem that I perceive in the policy that some of my noble friends on these Benches have espoused regarding nuclear weapons. The approach that is recommended by some says, “We won’t actually send out submarines with weapons on them unless there is a threat. We’ll keep them going out and end our continuous at-sea deterrence”. So if we find a situation now where these submarines are supposedly out and there is a threat—in a few months’ time there might be a greater threat, possibly on the Baltics or possibly somewhere else—at what point do we judge that the danger is sufficient to bring them back and put in the weapons? Is it now? Is it in a month’s time? Are we already too late? If you do that, would it not increase the militarisation of a problem that we already believe we should be de-escalating? We are in a serious problem and there is no easy answer to the dilemma that we are in.

However, I am persuaded that we need to look seriously at our strategic defence posture. I do not believe that what we have at the moment, which was largely defined on budgetary issues after the last election, is serving the purpose of seriously understanding how we deal with the chaos in the wider Middle East, across the north of Africa and below it and, increasingly, in eastern Europe. These are questions which this Chamber needs to come back and explore fully and thoughtfully because they are strategic threats, which

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we can ignore until the time when they come back to haunt us. Some of our friends, brothers and sisters closer to Russia, are already finding the past coming back to haunt them.

6.58 pm

The Earl of Lytton (CB): My Lords, I have no special knowledge of Ukraine but none the less, I felt compelled to speak in this debate. I, too, pay tribute to the noble Baroness, Lady Warsi, for introducing it so compellingly.

For someone like me, it is of great concern not to be able to pick through the propaganda war that is being perpetrated. There is the question of who to believe, given the anonymised militias and the civilian thugs we see on our televisions. There is a breakdown of trust; there is disinformation. Of course, we all would like peace and tranquillity in Ukraine but there are historical fault-lines of language and political affinities, plus of course those industrial assets, military facilities and key infrastructure—gas pipelines, for instance—which are of enormous importance to the Russian Federation. I follow the point made by the noble Lord, Lord Cormack: in a sense, we need to recognise this. I approach all this with a degree of humility and caution because, like the noble Lord, Lord Alderdice, if for different reasons, I believe that we have good reason to show humility.

I do not know how best we can help Ukraine work things out for itself, come to an internal social accord and find accommodation with Russia on the one hand and the rest of Europe on the other. Certainly immediate financial assistance is necessary, and we can perhaps particularly help by advocating the rule of law and sound economic principles, the ingredients that generate trust, commercial confidence and prosperity and which are in the end a bastion against corruption and external meddling, but these are very long-term aims. They are based on essential truths rather than short-term political fixes.

In recent weeks, we have seen on our television screens demonstrations and barricades in Kiev and elsewhere. It seemed to me that Ukrainians were to a degree united, if one can use that term, over the evils of extortion, corporate raiding, corruption and abuses by civil servants and law enforcers from the ousted President downwards, not forgetting his family and cronies. The sums are eye-watering: some $37 billion-worth of loans misappropriated and $70 billion transferred to offshore accounts in the past three years from a country of 45 million people where GDP per capita is around $3,900. This is brigandry and theft on a grand scale, perhaps matched only by the sheer vulgarity of the ousted President’s principal residence. His hurried departure, the bungled disposal of documents in the Dnieper river and their subsequent retrieval identified the further extent of the theft of state money.

I add to the comments made by the noble Lord, Lord Chidgey and Lord Balfe, and my noble friend Lord Sandwich on this because we now know quite a lot about the theft of state assets, in part thanks to the courage and, sadly, untimely death of Sergei Magnitsky, who has been mentioned in this House and another place on previous occasions. Noble Lords will recall that he was beaten to death in a Russian jail by the

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very people he had exposed. Hermitage Capital Management, which commissioned him to investigate the corruption, suffered the sequestration of its assets and subsidiaries and the fraudulent use of company identities. About two weeks ago, Hermitage’s chief executive officer, Mr William Browder, talked to the All-Party Parliamentary Group on Anti-Corruption, and I met him subsequently. Hermitage made a dossier available and has been instrumental in persuading a number of jurisdictions to take significant action against those responsible for these thefts. I cannot help thinking that that was partly responsible for the passing in late 2012 of the Magnitsky law in the United States. Other jurisdictions have followed in the seizure of assets and the freezing of accounts, but one jurisdiction appears to be notable for its apparent inaction, and it is the UK.

Despite receiving the same information in 2012, all that has been received are bland platitudes, excuses about needing to proceed carefully and about not upsetting people, and claims of taxpayer and company confidentiality. This was raised in an adjournment debate in another place in January 2012 and on 7 March 2012 the Commons unanimously approved a Motion calling for action. Later the same year, the honourable Member for Esher and Walton, Dominic Raab, raised the issues in correspondence with the same agencies that received the initial letter from Hermitage’s lawyers. Why is this? Why such inaction?

It is safe to say that UK intelligence sources must have known a great deal about what was going on and where money was coming from. Are we satisfied that none of this money somehow found its way, directly or indirectly, into UK Treasury bonds? Can the Minister tell the House what audit has been carried out into this?

My point is this: the UK is a place where it is pleasant to live, to have property, to educate children and to invest money. It is the financial capital of the world and when things hit trouble around the globe, people look to a safe jurisdiction where one might assume that the rule of law, good order and sound public administration prevail. It is not a place where one would wish suspect money to be laundered, especially when we have some of the most sophisticated anti-corruption and company laws in the world. But that is the accusation that Mr Browder is levelling against this country. He told the all-party parliamentary group that Britain has some of the most porous and least diligent supervision of any jurisdiction that he knows about. He went on to say that the UK, and London in particular, is all too often the destination for this booty. To the extent that there is knowledge but no action, that would, if true, make this country complicit in the very theft that it claims to abhor and stand against. Worse still—again, if this is true—when British businesses and individuals are pursued by our authorities for relatively minor infractions or inadvertent mistakes, one might reasonably add hypocrisy to the charge sheet.

The Magnitsky trail identified several UK-registered firms; they have been mentioned in another place and I shall not do so again. The documents recovered from the Dnieper attest to a network of UK shell companies; three, in particular are linked to the alleged Yanukovych

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properties in Ukraine. This information is all in the public domain. Some of the transactions may of course be innocent but the fact is that a very great deal of Ukraine’s money has gone missing and that is politically and economically destabilising.

It is obviously a matter of some considerable cost to pursue miscreants through the courts. But a cheaper approach, advocated by Mr Browder, is to name, shame and deny entry visas to those implicated and deprive them, their families and associates of rights to come to this country, where many of them like coming. The EU Council decision on freezing assets is welcome, and the detention of Dmytro Firtash is a creditable start, particularly in Austria, which does not have the greatest record of dealing with these things. The UK’s pre-eminence as a financial centre gives it a unique lever in its own right. So what are we, the UK, doing to assist Ukraine in this respect, to discover where money is going and how it can be repatriated?

I agree that seizure of assets and entry restrictions will send the right message, but only if they are targeted to suspect criminal parties, not if they are used simply to express a distaste of geopolitical adventurism, which is quite a different matter and should be clearly distinguished. Objective identification of criminality should therefore not be blunted by political considerations. There is a need for a principled stand. We should enforce corporate and financial laws consistently. This is the bedrock of trust, cohesion and stability, and a demonstration that the rule of law matters and has both social and economic value.

Finally, there are of course enormous assets that should be unearthed and returned. I would like to know what action the UK Government are taking to identify and return money stolen from the people of Ukraine.

7.09 pm

Lord Trefgarne (Con): My Lords, with your Lordships’ permission I will make a brief intervention at this point. I apologise to your Lordships for not having put down my name on the list in the normal manner.

I start by saying that my knowledge of our relations with the Soviet Union, as it then was, and eastern Europe stems from a very short time as a junior Minister in the Foreign Office responsible for those matters—frankly, I was a very junior Minister. I was instructed by the late Sir Michael Palliser, Sir Rodric Braithwaite and Sir Christopher Mallaby—great people whom I am sure the noble Lord, Lord Kerr, will know well. Sadly, my training in those matters was brought to a premature halt by the Argentinians in April 1982, which is the reason for any shortcomings that I shall no doubt now reveal.

My preference in these matters is for a diplomatic solution above all. I suggest that the sort of diplomacy that we want is not megaphone diplomacy, which we hear so often these days, not least from across the Atlantic. My noble friend Lord Carrington turned the phrase “megaphone diplomacy” in some other connection. Progress in this regard will not be easily achieved by the kind of shouting at each other that we so often hear at present. One has to have a certain sympathy with the Russian position, but no sympathy at all for

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any contravention of international law or the norms of international behaviour, which I fear we have witnessed in recent times.

I will make a simple suggestion to the Minister, which I hope will be a partial way forward, if that can be identified. I refer to the possibility of leasing Crimea to the Russians while the Ukrainians retain sovereignty. We have some experience of this matter. Hong Kong, of course, was leased for a 99-year period, which ended successfully and peacefully a few years ago, and we have a sort of lease for the so-called sovereign bases in Cyprus, Akrotiri and Episkopi. I do not know whether a formula of that kind could be a partial solution to the problem, but I suggest that it is worth exploring and I invite the Minister to consider it. Perhaps it has already been considered, in which case I would be happy to hear that. However, in the mean time, if we could stop shouting at each other through megaphones, that would be a way forward.

7.12 pm

Lord Campbell-Savours: My Lords, with the leave of the House I will speak in the gap.

I place on record my strong dissent from the position taken by the European Union, the British Government and the Government of the United States in their treatment of this issue. We meddle at our peril in a part of eastern Europe that we little understand.

I will clarify the position on the Budapest memorandum, which has been oft-quoted in the press and during this debate. The Budapest memorandum was determined on the basis of a need to reduce nuclear weapons deployment in eastern Europe in the early 1990s. It was never seen as a settlement of boundaries in that part of eastern Europe. It does not guarantee frontiers and it is not a treaty, but it reaffirms an obligation to refrain from the threat or use of force against the territorial integrity of Ukraine. Russia is perfectly entitled to challenge the territorial integrity of Ukraine as long as it does not use force and it has been so challenging since 1994. Anyone who follows the debate that has been going on over the years in eastern Europe will know that there has been a constant discussion over that matter, which is unsettled business as far as the Russians are concerned.

Furthermore, there is no evidence that force was used prior to this referendum. Yes, there has been lots of reporting of the alleged use of force, but I have not seen evidence of it. At the end of all this—no doubt there will be some kind of inquiry—I feel confident that we will find that force was not used. The use of force has not led to celebration and jubilation on the streets throughout Crimea, particularly on the back of a 96% vote on an 83% turnout. That does not suggest to me that those people have been intimidated into the way they have voted; they have simply voted for what they want, and they can now have it.

The truth is that Crimea is Russian and it is an accident of history, following the collapse of the former Soviet Union, that it has ended up in Ukraine. A historical mistake is now being corrected and in my opinion we are overreacting. We have repeatedly humiliated Russia over the past 20 years; it was particularly

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humiliated over the break-up of Yugoslavia. Indeed, the Russians now quote the precedent of Kosovo. They pray in aid the 2010 ruling by the International Court of Justice, when it states that international law contains,

“no prohibition on declarations of independence”.

We cannot ignore these precedents. Throughout the world, people are referring to the precedent of Kosovo. It is very interesting that, during this debate, there has been very little reference to what has happened in Kosovo. Indeed, when I intervened on the Minister at the beginning of the debate, she did not respond.

We need dialogue with the Russians, not sanctions. These sanctions will turn us into a laughing stock. It is out of dialogue that we can avoid these problems in future. The course that we are on is going nowhere and we will be humiliated when we back down.

7.16 pm

Baroness Morgan of Ely (Lab): I thank the Minister for her initial presentation and other noble Lords for their interesting contributions this afternoon.

Both Russia and the West have found themselves trapped in a position that I believe neither of them wanted to be in. The trick now is to find a way of containing the situation, de-escalating an extremely serious situation in Ukraine and sending a clear and unequivocal message to Russia that annexation in this manner is unacceptable. In this, the Government have our full support.

The question that we need to ask ourselves is how we got into this situation, and why Russia is behaving in a way that will clearly have consequences for it in the international community. Many commentators have argued that we should not be too surprised by Putin’s approach to events in Ukraine; after all, he established his political position in his 2007 Munich speech, when he called the dissolution of the Soviet Union the greatest catastrophe of the 20th century. Russia is still coming to terms with the loss of the USSR—the old Russian empire, as the noble Lord, Lord Cormack, said. The potential development of a free-market, democratic Ukraine, especially one integrated into western economic and security structures, is perceived as a real threat. Many Russians have never accepted that Ukraine is truly separate from Russia.

“Ukraine is not even a state”,

Putin told George Bush in 2008. He said that part of its territories were,

“in Eastern Europe, but the greater part is gift from us”.

Russia has reacted aggressively to the demands of the Ukrainian people, who set their face against a Russian plan to develop a Eurasian union in favour of a trade relationship with the EU, effectively killing Putin’s plan for a new trade area. Russia was concerned that rapprochement with Europe would mean, ultimately, that Ukraine would join NATO, and has always been keen to maintain a buffer zone of sympathetic countries on its borders. As the noble Lord, Lord Kerr, indicated, that offer to join NATO was never on the table. Let us not forget that the Kremlin was also concerned about losing its military base in Crimea, and that a successful revolution on its border might encourage opposition groups within Russia itself, particularly after the protests

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witnessed there in 2012. It has proved to be a very popular move within Russia, with 70% support for its actions in the Crimea.

We should not lose sight of the economic situation facing Russia at this time. Russia’s economy is already in a de facto recession with a drop in investment, a rapid decline in consumer demand and a real terms decrease in incomes. The economy has already shrunk for two consecutive quarters. The rouble is weakening, causing expectations of growth in inflation. Russia’s Ministry of Economic Development has revised downwards its short-term forecasts on an almost monthly basis, so Russia was, and is, in a touch of economic trouble and could be looking for an outside distraction. This strategy worked well for Putin during the upheaval in Chechnya, which boosted his popularity in Russia. However, Russia should be extremely careful in the risks it is taking and the West needs to send a strong message to Moscow that there will be costs and consequences to Russia for this action.

Despite all this, it is right to acknowledge that the crisis did not start because of President Putin. Russia is responding to the situation in Ukraine rather than having a master plan that provoked the current crisis. However, it is also true to say that, rather than helping to resolve the crisis, Russia has sought to exploit and inflame existing ethnic, linguistic and geographic fault lines within Ukrainian society.

The West’s response has been cautious despite Russia’s actions having broken a whole raft of international treaties. The massive increase in the number of troops in Ukraine violates the charter of the UN, the Helsinki Final Act, the Budapest memorandum of 1994 and the Russia-Ukraine agreement on military bases.

Ultimately, however, we need a stable situation on the border of the EU and nobody wants to see a military solution to this situation. It is, however, in our interest to ensure that stable, free democratic countries flourish in Europe. Russia, through its actions, has now entirely isolated itself from the international community on this issue. I particularly welcome the abstention by China from the UN vote on the illegitimacy of the referendum in Crimea at the weekend. This really demonstrates to Russia that it is friendless in pursuit of its policies in Crimea. However, an isolated Russia in the long term is in nobody’s interest. We have a moral responsibility to help Ukraine. It is worth heeding the words of Ukraine’s Prime Minister, Arseniy Yatsenyuk, even if, as my noble friend indicated, some of the guarantees are perceived rather than real. Arseniy Yatsenyuk said:

“A country which willingly gave up its nuclear arsenal … and received guarantees from the world’s leading countries, finds itself unprotected, one-on-one with a country which is armed to its teeth. If you do not uphold these guarantees … then explain how you will convince Iran and North Korea to give up their nuclear status”.

Events in eastern Ukraine over the past couple of days are potentially more dangerous than the situation in Crimea. In Crimea, Russian troops are present under a long-standing agreement, although they have gone way beyond the agreed remit. However, if Russian forces keep pushing into eastern Ukraine, it becomes unambiguously an invasion. The killing of a Ukrainian officer in an attack on a base in Crimea, reported this afternoon, is an ominous step in the wrong direction.

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We need to support a graduated hierarchy of diplomatic and economic measures against Russia. Already, as we have heard, the EU has agreed to suspend the Russian visa liberalisation programme and has pulled out of Sochi G8 preparation meetings. European Union member states have agreed the wording of sanctions on Russia, including travel restrictions and asset freezes against those responsible for violating the sovereignty of Ukraine—but, disappointingly, only 21 of them. We need to know from the Government whether, at the EU Council on Thursday and Friday of this week, the UK Government will urge the cancellation of the EU-Russia summit scheduled for June. I ask the Minister for clarification on whether the Government are looking to suspend Russia from the G8 group.

Russia now really understands that it is an integrated part of the world market and cannot isolate itself from the rest of the world. This should have been heard loud and clear in Moscow on 3 March when Russia’s stock market plummeted by 12% and the rouble fell by 1.9% against the dollar, in spite of massive intervention by Russia’s central bank—although they have risen since. There will inevitably be a knock-on effect in terms of a decline in investment due to both the increased cost of borrowing in Russia and the further alienation of investors.

Russia needs Europe. Exporting natural gas to Europe is big money for Russia; it accounts for a fifth of its total earnings, some £60 billion a year. Sanctions on that will hurt. Nobody is suggesting that Europe can switch gas suppliers overnight but, over the medium to long term, the EU simply cannot risk more than 30% of its supplies coming from such a politically unstable source. For a decade, Europe has been aware of this vulnerable overdependence on Russia but has not moved fast enough to look to alternative markets. To be fair, the alternative options were not evident before, but shale gas from the US could provide a medium-term solution to Europe and cause a problem to the Russians. It cannot happen overnight but the Russians must be aware that they are playing a dangerous game with their largest customers, and the US must be prepared to open its gas market to the world if it is serious about helping Europe in response to the Russian situation.

There will be a cost to Europe as well, and Britain and the West will need to decide whether we are serious about standing up to this bully and whether we are prepared to take the economic hit to make our point. I regret that, to date, the EU’s unity in condemning Russia’s military aggression has not been matched by a shared resolve to act more decisively in extracting costs and consequences for this action. I hope that the European Council next week will consider expanding the list of Ukrainian and Russian officials who will be subject to targeted measures if Russia does not indicate a change of course. President Putin may believe that sanctions will not last, as was the case after the Georgian war of 2008, but the West needs to send a clear message that needs to be sustained over the long term. Russia is faced with two alternative futures: greater integration within, or greater isolation from, the existing international order.

However, a strong signal needs to be sent to Ukraine as well. The Ukrainian military needs to be commended on its calm response to the situation so far. Despite

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considerable efforts to provoke a reaction with increasingly aggressive behaviour in the east of Ukraine by Russian supporters, the military of Ukraine has so far not been provoked into action. Minorities in Ukraine need to be given assurances that they will be protected and that Russian speakers will not suffer discrimination. Legitimate elections need to be overseen by the international community to give credibility to Ukrainian leaders. We need to see an end to rampant corruption in the country and a loosening of the stranglehold that some of the oligarchs have on the place. If Ukraine changes, the West will need to help with technical assistance and significant financial support.

Last weekend’s referendum in Crimea needs to be seen for what it is—an artificial and unfair political construct that has no legitimacy. No campaigning was allowed by Ukrainian supporters, there were no voter lists and, shortly after the referendum was called, Ukrainian TV channels were removed from both terrestrial broadcasts and cable networks in Crimea. Some of them were replaced by Russian stations.

We are in a crisis situation. Russia shows no signs of being cowed by the sanctions that the West has imposed so far. The answer to this problem can clearly not be a military one, but it is in all our interests to try to de-escalate the situation while remaining robust and ensuring that the international community responds together to this frightening situation on our continent. The international community must now do more to encourage Russia to engage in a constructive dialogue, while simultaneously applying greater pressure if President Putin refuses to change course. A combination of deft diplomacy, shared resolve and a unified response are the best ways in which we can de-escalate this dangerous crisis, ultimately reaffirm Ukrainian sovereignty and preserve European security. The Government will have our support in helping to achieve this desired outcome.

7.30 pm

Lord Wallace of Saltaire (LD): My Lords, I thank, in particular, the Opposition Front Bench for that very constructive and helpful speech. This is a take note debate, and I cannot, and would not wish to, announce the definitive policy of Her Majesty’s Government in response to the Ukraine crisis because it is still under way. As the noble Baroness, Lady Suttie, said, the important question is not where we are but where it ends. As the noble Lord, Lord Soley, wisely said, it would be naive to consider that it will stop here. There is some way to go and we have some influence over where it will end, and the Government are fully engaged in trying to bring to bear the influence that they have.

Yesterday, my right honourable friend and colleague the Foreign Secretary was at a meeting of the Foreign Affairs Council, where a number of decisions were taken. On Thursday and Friday, the Prime Minister will be at the European Council, at which a number of further decisions may be taken, and we will continue from there. We do not yet know how far President Putin will go. So far as we can see, this is very much a matter of what President Putin wants. I am not even sure that it is very valuable at present to talk to the Russian Foreign Minister—I am not sure that he always entirely knows what President Putin wants to

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do. Whether or not the Russians will continue to complete the annexation of Crimea within the next week is clearly one of the matters that we will have to take into consideration. We will do our best to help and will put pressure to bear so that that does not happen, but it may. Therefore, there is a great deal to play for and we will have to come back to further discussions in both Houses of Parliament and, of course, to continuing discussions with our allies and partners in the European Union and NATO and more widely within the UN. Her Majesty’s Government are extremely hard at work in co-operation with all our allies and friends.

A great deal has been said in this debate about interpretations of history—about Russian motivations, Putin’s motivation and the Russian view of their place in the world and their post-imperial angst. This country is not entirely without its post-imperial angst. The rest of the world does not always pay that much attention to us. We go into great paroxysms over why the Europeans are not nicer to us and why they do not give us what we want when we wish to have a bit of this, a bit of that and not too much of the other, but we sometimes have to accept that the rest of the world does not see the world as we wish to see it. That is also true of Russia today.

The noble Lord, Lord Howell, rightly said that what we have in Russia is a 19th-century approach to a 21st-century world—one in which it thinks that hard power is all that counts, with no truck with the soft power, on which the noble Lord, Lord Howell, is such an expert. There is an expectation of easy access to the open societies of the West without a reciprocal impact on Russian society and the Russian economy. I think it was the noble Baroness, Lady Morgan, who talked about whether Russia had a choice between integration and isolation. My understanding of one of the many themes of Russian history is that modernising efforts in Russia have always been an attempt to take the technical advances from the West without accepting the social and political implications. That was true of Peter the Great, it was true of the 19th century and I think that it is exactly true of where Putin is now. That is part of the problem. They think that they can pick and choose. Incidentally, there are those in this country who think they can pick and choose the quality of our relations with our major partners and are now discovering that they cannot. The Russians may also be discovering that they cannot, but certainly the mindset of Putin and those around him is that Russia can pick and choose and have the advantages of access to the open economy and open society of the West without allowing those influences to contaminate the autocracy of Russia.

Other countries also cherish nationalist memories and myths of their own, which we do not always wish to accommodate. After all, it was the myth that Kosovo was the birthplace of the Serbian nation that persuaded Milosevic and others to cling on to Kosovo in spite of the fact that there were no longer many Serbs living there. There are Muslims across the Middle East who believe that the reconstruction of Islamic caliphate is a vital part in reconstructing their myth of history. I dare say that the noble Lord, Lord Campbell-Savours, does not share that view. Perhaps I may say to the

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right reverend Prelate the Bishop of St Albans that the Russian Orthodox Church in the high point of the Tsarist Empire collaborated in the idea that Moscow had become the third Rome and, as the third Rome, was entitled to reconquer the second Rome so that Constantinople logically should belong to Russia. That is not something which we accepted and, indeed, part of why we fought the Crimean War was to prevent the Russians from expanding to take over Constantinople.

All those things are a matter of how one views history and, as we all know, there are different ways in which to view it. Crimea is Russian today; it was Tatar yesterday; it has been a matter between many different nations. As I was writing this today from my limited knowledge of Ukraine, I was thinking that, within the lifetime of the majority of Members of this House, the people of Ukraine have been through the most incredible amount of suffering, changing of boundaries and one thing after another. My colleagues in the Foreign Office have always tried to get me to read a number of different books. I have read Timothy Snyder’s Bloodlands, which is entirely about how the lands between Germany and Russia suffered from the 1930s through to the 1940s. Famine in Ukraine was followed by the German invasion and then by the Soviet counterinvasion, which left the Ukrainians deeply divided, confused and mistrustful of each other and of all government.

We are working very hard on how to respond to Russian interventions. We have suspended indefinitely preparations for the G8 meeting in Sochi in June. It would be wrong for the G8 summit to go ahead in the current circumstances. We are considering what other measures to take. Of course, we recognise that we need to continue to talk to the Russian Government and, even more, to Russian society about a whole range of issues. But normal diplomatic relations cannot continue on the privileged basis which Russia felt that it would have.

The noble Lord, Lord Campbell-Savours, said that a historical mistake is now being corrected—we could spend a lot of time talking about what historical mistakes are—and suggested that there was no evidence of force. The evidence we have is that there are now 30,000 Russian soldiers in Crimea and that the Crimean parliament’s vote on unification with Russia took place with armed troops of Russian origin in the building.

Lord Campbell-Savours: Is the figure of 30,000 in excess of what was possible under the agreement that existed prior to this crisis?

Lord Wallace of Saltaire: There is considerable evidence that a large number of Russian troops have arrived in Crimea in the past two to three weeks. My clear understanding is that it is not within the agreement. If I am wrong, I will write to the noble Lord. As a matter of interest, a number of troops, including troops from within the North Caucasus, were engaged in—one might put it gently—holding down Chechnya. We recognise that Russia’s rational interests lie in a prosperous and stable Ukraine, as a number of noble Lords have said. We also recognise that international

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politics is not entirely rational. The First World War would not have broken out if international politics had been entirely rational.

I say to the noble Lord, Lord Cormack, that of course the UK will do everything possible to maintain a constructive dialogue but it has to be a dialogue in which both sides listen and search for agreement on shared principles. We cannot accept that Russia has one set of principles but expects us to observe another. The noble Lord, Lord Chidgey, talked of stand-up arguments with Duma deputies. A lot of us have had that. I seem to remember having such an argument when I was leading a delegation that included the noble Lord, Lord Howell. I rather enjoyed the exchanges.

We have to tell the truth to our Russian partners and recognise that those within the elite demand the rest of the world to accept the special character of the Russian state, which we are not prepared to accept. Russian suggestions that we should move towards a federal and loose Ukraine while maintaining a centralised and authoritarian Russia are a good example of how proposals are being made that would be irrational to accept, but it is attempting to impose them.

It is deeply regretful that the current Russian regime appears to need weak and divided neighbours in order to feel secure. One worry is that a weak Crimea will join an occupied South Ossetia, Abkhazia and Transnistria and others as a means of weakening the states around Russia.

Lord Lea of Crondall: I am sure that the Minister is not misrepresenting the Russian position. However, equally, many of us have argued that no matter whether it is federal, devo-max or so on, you cannot go on with a unitary state with the sort of election results of 51% and 49%—and then winner takes all and you have arrested the leader of the Opposition. That is why I mentioned Northern Ireland. There is a caricature going on here.

Lord Wallace of Saltaire: There are all sorts of questions in the noble Lord's remarks and I could respond in a number of ways, but at this time of night I hesitate to do that.

The noble Lord, Lord Trefgarne, suggested that we might have a sort of sale and lease back with the Russians. The Ukrainian constitution makes it clear that any alteration of the territory of Ukraine must be resolved by an all-Ukrainian referendum. Article 134 of the constitution sets out that the autonomous Republic of Crimea is an integral constituent part of Ukraine and can only resolve issues related to the authority within the provisions set out by the Ukrainian constitution.

One could have negotiated this. The Government consider the referendum in Crimea to be illegal because it has been rushed through under the presence of a large number of Russian troops without updating the inaccuracy of the electoral register, with OSCE observers being refused entry. It is therefore not in any way acceptable to international standards.

The UN Security Council resolution was clear and strong on all of this. I say to the noble Lord, Lord Cormack, that of course there is a role for the

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UN Secretary-General and the UN. The Chinese abstention was a silent acknowledgement that some fundamental principles of international law and international sovereignty are at stake in this crisis.

A number of noble Lords suggested that we have to include Russia in all future discussions with Ukraine. Of course we do. We still make every effort we can to maintain a dialogue with Russia. We continue to urge Russia not to take any further action towards annexation of Ukraine. The UK remains supportive of the EU-Ukraine Association Agreement and it is now likely that the political and foreign policy aspects of the association agreement will be signed at the meeting of the European Council this week.

Lord Campbell-Savours: The Minister referred to the fact that OSCE monitors have been denied access. I understand that the Russians are claiming that something like 100 international monitors went in. Is that true or are they misleading us? If it is true, do we know where those monitors came from in the world community?

Lord Hylton: My Lords, before the Minister replies to that, will he say something about the OSCE in the sense that it may well provide an opportunity for achieving consensus for de-escalating the situation and for the giving up of extreme positions?

Lord Wallace of Saltaire: My Lords, I do not have any information on the question put by the noble Lord, Lord Campbell-Savours. I am aware of Russian reports that observers are there. They are certainly not under any international or umbrella organisation, the Council of Europe or the OSCE. We hope to discover more. The OSCE does have a role to play and a number of OSCE missions of one sort or another are currently either in Ukraine or in prospect, and members of those missions are British. The OSCE is an entirely appropriate framework to work with for this development.

Russia, as noble Lords know, has not always been the most constructive member of the OSCE in recent years. A number of noble Lords suggested that we may have contributed to that, and perhaps have even provoked Russia. Bill Cash MP was indeed interviewed on “Russia Today” last Thursday suggesting that it was really all the EU’s fault. I am not entirely sure that I share that view. Comparisons are also made between Kosovo and Crimea, to which I would simply say that our action in Kosovo was a response to a humanitarian situation in which there was clear evidence of ethnic cleansing and that a large number of people had been killed. It was a slow process in which we recognised that the situation was slipping out of control. None of that has happened in Crimea. The interim Government in Kiev bear no comparison with Belgrade under Milosevic and we took action in Kosovo only after years of diplomatic effort, whereas in Crimea Russia has chosen the military option first and rushed through what appears to be likely annexation.

I turn to the situation within Ukraine. My noble friend Lord Alderdice suggested that Ukraine is split down the middle. To that I would say that it is more confused, fractured, misgoverned and mistrustful. There

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is some evidence that many Russian speakers in eastern Ukraine are more mistrustful of Russia now than they were even a year or two ago, with some justification. The extent to which we understand what is happening inside Ukraine is something that I suspect we need to be cautious about.

The biggest question is this: can the West’s soft power defeat Russia’s hard power? It did not in 1913-14. The suggestion of the noble Lord, Lord Davies of Stamford—who I regret to see has not remained in his place having intervened earlier—was that Russia would just shrug economic sanctions off. However, a number of noble Lords talked about the long-term costs in terms of shifting away from energy imports. Of course we are talking to other countries, including the Norwegians, about future energy supplies. The costs to Russia in terms of a deterioration in foreign investment and of its other openings are likely to be quite damaging in the long term. The question here is how long is the long term, and what damage under its current regime can Russia do first?

Let me try to cover one or two other points before I finish. I can confirm to the noble Lord, Lord Kerr, that it is not British policy that Ukraine should join NATO. Many of us felt that the attempt by the Bush Administration at the Bucharest summit in 2008 to push NATO enlargement as far as Georgia and Ukraine was a mistake. The Foreign Secretary has said on a number of occasions that we are not asking Ukraine to choose between Russia and the West, but I should also remind noble Lords that the EU’s approach to enlargement was not a great push by the Union. As I discovered when I first started going around eastern Europe in the 1990s, it was a reluctant response to insistent demands from our eastern European partners to gain access to our legal framework, to our economy and to our security provisions. The Estonians and others were particularly strong on that. There is a monument in Tallinn to the British squadron which preserved the independence of Estonia from the Russians in 1919, and the country still remembers that. The Poles, who have a lot of influence in this area, are also conscious that they contributed a great deal to the British effort in the Second World War, something which UKIP has now happily scrubbed out of our historical memory. The largest number of non-British pilots in the Battle of Britain were Polish, so we are not dealing with an area with which we have no historical concern or very little historical connection.

I am conscious of the time. A number of noble Lords spoke about money-laundering. We have sent a group from the National Crime Agency, the Metropolitan Police and the Crown Prosecution Service to help the Ukrainians in their efforts to investigate the stolen funds and we are working with them on that. The noble Earl, Lord Lytton, raised some very specific questions about the Magnitsky case, which it may be appropriate for me to write to him about.

We have to reassure our east European allies. We are working with our friends and colleagues and will continue to do so as well as we can. We are in mid-crisis and do not know how or when this crisis will end, but Her Majesty’s Government will continue to work with our European and NATO partners and, more broadly,

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within and through the UN. There are fundamental principles of international law and sovereignty at stake, so we will return to this issue in both Houses of Parliament as we proceed. We will of course attempt to maintain a dialogue with the Russians, difficult though that is likely to be, and to pursue a reasoned and reasonable outcome. We will offer all the technical and financial assistance we can to Ukraine, together

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with our partners. As in so many international crises, there is no easy solution to be found, and we have to bend our efforts to promote an outcome that may be acceptable to all.

Motion agreed.

House adjourned at 7.51 pm.