G20 Summit

Baroness Royall of Blaisdon Excerpts

Monday 25th June 2012 Lords Chamber

[Baroness Royall of Blaisdon]

My Lords, I thank the noble Lord, the Leader of the House, for repeating a Statement given in the other place by the Prime Minister on the recent G20 meeting. Unusually, I did not see a copy of the Statement in advance. I am not complaining, but it does make life rather difficult.

I will start with the foreign policy issues. On the Falklands, there is support from this side of the House for the absolute need to protect the principle of self-determination of the islanders. On Syria, there is deep concern on all sides of the House about the continued failure of the Annan plan to deliver a cessation of violence, and there is cross-party consensus on the appalling nature of the Assad regime and the need for the toughest sanctions against Syria. We welcome today’s extension of EU sanctions but given the urgent need for an immediate end to the dreadful and escalating hostilities, does the noble Lord the Leader of the House agree that it is now vital that the wider international community unites around the need for the toughest sanctions against Syria?

The Prime Minister said in his press conference that:

“President Putin has been explicit that he is not locked into Assad remaining in charge in Syria”.

If correct, this clearly represents an important step forward. However, Foreign Minister Lavrov said afterwards in a statement that these comments did not “correspond with reality”. Can the Leader of the House clarify the position?

I now turn to the main business of the summit—the economy. With our country in double-dip recession, with world growth slowing and with the eurozone crisis, if ever there was a time for the international community to come together and act, this was it. All we got from this summit was more of the same: drift and inaction in the face of a global crisis. The Prime Minister claimed afterwards that the summit had made “important progress” on a number of issues,

“on the Eurozone, on the lack of global growth and on the rise of protectionism”.

This sounded familiar. Then we realised why—because the Prime Minister said exactly the same after the last summit, in Cannes last November.

The Prime Minister now says:

“In terms of the slide towards protectionism, I think that has been halted”.

Can the Leader of the House confirm that the Prime Minister told us precisely the same thing in November? That summit was a success because action had been taken to,

“stop the slide to protectionism”.

That was a great triumph—the slide that had been stopped last November has been halted again.

On global growth, the Cannes summit communiqué said that,

“should global economic conditions materially worsen”,

countries should,

“agree to take discretionary measures to support domestic demand”.

Well, global conditions have worsened and therefore, being true to that communiqué, this G20 should have been a coming together of world leaders to work for a co-ordinated plan for jobs and growth. And what did we get? The communiqué just repeated the same words:

“Should economic conditions deteriorate significantly further, those countries with sufficient fiscal space stand ready to coordinate and implement discretionary fiscal actions to support domestic demand”.

No change, no action.

On the eurozone, I note that the Statement says:

“As full members of the European Union, and a significant net contributor to its budget it is vital that we speak plainly about what needs to happen”.

I think that our partners would have listened to us more if the Prime Minister had not decided to use the veto that never was in December. Actions for short-term political gain have long-term consequences.

The Prime Minister said that while this was not a European Council meeting, progress was made with,

“significant agreements. Now the eurozone countries need to get on and implement them”.

But is not the reality that there is no agreement on the main issues of substance, such as how to recapitalise Spanish banks; how the European Central Bank can stand behind member countries; how to prevent the escalation of problems in bond markets; or how to boost the size of the firewall fund to make it work? Instead, we had more of the same.

For people here at home, the economic reality is that things are getting worse, not better, and there is nothing in this summit’s conclusions to make any difference to that. And there is a simple reason why there was nothing for Britain at this summit: because we have a Prime Minister, and a Government, who simply argue for more of the same. What a contrast with France, where the president is passionate about growth, understanding that it is a prerequisite for dealing with deficits. Austerity is not working; with Britain in a double-dip recession, one of only two G20 countries in that position, can the Leader of the House tell us whether at the G20 the Government were actually arguing for anything different from what they were arguing for last November? From today’s Statement, it does not look as though they were.

Can the Leader of the House confirm that at the time of the Cannes summit, UK growth for 2012 was forecast to be 1.2% and that now the average of independent forecasts is just 0.3%? On the world economy, what this summit needed was a co-ordinated plan to generate greater growth, but the international community is divided between those who want a move towards greater growth and jobs and those whose answer to the failure of the last two years is simply more of the same. I fear that, on this issue, this Government and this Prime Minister are on the wrong side of that argument.

There is one important lesson for the Government from the last week. A global summit in the face of an economic hurricane needs action, not words. The reality is that the Government and the Prime Minister have come back from this summit with nothing for Britain—nothing to cope with double-dip recession, nothing to help Britain’s families and nothing to ensure growth in the world economy. I trust that when the Prime Minister returns from the European summit next week he has growth at the top of his Statement and agenda. Britain deserves more than was achieved at the G20 summit, and we deserve a change of direction; a change of economic strategy; a change that puts action first, not words; and a change that puts jobs and growth first.

[Lord Strathclyde]

My Lords, the noble Baroness the Leader of the Opposition is on good form today. Typically, she sees a socialist president being elected in France, looks over the water and believes that everything over there is going swimmingly. However, she has not read what the good president has said. He said that,

“national debt is the enemy of the left and the enemy of France”.

We agree with that. Mr Hollande would balance France’s budget faster than the coalition plans for the United Kingdom. When asked how he would stimulate growth, the French President said, “The means cannot be extra public spending since we want to rein it in”. We can agree with that; the noble Baroness and her party cannot.

We very much welcome the noble Baroness’s support on the Falklands and Syria. The situation in Syria is immensely dangerous, difficult and complicated. We are still discussing with key partners what more we can do, including in the United Nations, to support the Annan plan. There remain differences over sequencing and the exact shape of how a potential transition can take place but we have put in place a strong EU arms embargo, are closely tracking other shipments to Syria and want to work with countries and companies around the world to stop them. We have had useful conversations with Russia but the key thing is to get together, to work together and to try to implement the Annan plan, if at all possible.

I rather admire the fact that the noble Baroness’s research led her to spot that some of the words in this communiqué were the same as those used at the Cannes summit. She read that as signifying that nothing had changed. However, it may also prove some admirable consistency emanating out of G20 summits in that there are still common problems with which to deal, and they are going to be dealt with.

The noble Baroness took a pot shot at what my right honourable friend the Prime Minister did at the EU summit at the end of December, which was not to sign up to the communiqué. As I said at the time, the reason my right honourable friend did not sign that communiqué was because he believed in protecting British interests, which is what he did. The noble Baroness and her party would have signed it and, we believe, would have sold vital British interests down the river.

The G20 was a success in the sense that many of these gatherings are a success as an opportunity for the leaders of different countries to discuss some of the key issues facing the world and to try to come to an agreement. There was no shying away from the fact that one of the most difficult issues facing the world at the moment is the problems in the eurozone. We have come up with what we believe to be helpful and constructive words to try to encourage the eurozone to find a solution in preparation for the European Council later this week. However, in the end, the countries in the eurozone have to make those decisions themselves.