Hillsborough

Lord Cameron of Chipping Norton Excerpts

Wednesday 12th September 2012 Commons Chamber

[The Prime Minister (Mr David Cameron)]

With permission, Mr Speaker, I would like to make a statement on the report of the Hillsborough independent panel. Today, the Bishop of Liverpool, the Right Rev. James Jones, is publishing the report of the Hillsborough independent panel. The disaster at the Hillsborough football stadium on 15 April 1989 was one of the greatest peacetime tragedies of the last century; 96 people died as a result of a crush in the Leppings Lane terrace at the FA cup semi-final between Liverpool and Nottingham Forest.

There was a public inquiry at the time by Lord Justice Taylor that found that the main cause of the disaster was

“a failure of police control.”

But the inquiry did not have access to all the documents that have since become available, it did not properly examine the response of the emergency services, and it was followed by a deeply controversial inquest and by a media version of events that sought to blame the fans.

As a result, the families have not heard the truth and have not found justice. That is why the previous Government, and in particular the right hon. Member for Leigh (Andy Burnham), was right to set up the panel and it is why this Government insisted that no stone should be left unturned and that all papers should be made available to the Bishop of Liverpool and his team. In total, more than 450,000 pages of evidence have been reviewed.

It was right that the families should see the report first. As a result, the Government and I have had only a very limited amount of time to study the evidence so far. But it is already very clear that many of the report’s findings are deeply distressing. There are three areas in particular: the failure of the authorities to help to protect people; the attempt to blame the fans; and the doubt cast on the original coroner’s inquest. I want to take each in turn.

First, there is new evidence about how the authorities failed. There is a trail of new documents which show the extent to which the safety of the crowd at Hillsborough was “compromised at every level”. The ground failed to meet minimum standards and the “deficiencies were well known”. The turnstiles were inadequate. The ground capacity had been significantly over-calculated. The crush barriers failed to meet safety standards, and there had been a crush at exactly the same match the year before. Today’s report shows clearly that lessons had not been learned.

The report backs up again the key finding of the Taylor report on police failure, but it goes further by revealing for the first time the shortcomings of the ambulance and emergency services’ response. The major incident plan was not fully implemented; rescue attempts were held back by failures of leadership and co-ordination; and, significantly, new documents today show that there was a delay from the emergency services when people were being crushed and being killed.

Secondly, the families have long believed that some of the authorities attempted to create a completely unjust account of events that sought to blame the fans for what happened. The families were right. The evidence in today’s report includes briefings to the media and attempts by the police to change the record of events. On the media, several newspapers reported false allegations that fans were drunk and violent and stole from the dead. The Sun’s report sensationalised these allegations under a banner headline “The Truth”. This was clearly wrong and caused huge offence, distress and hurt. News International has co-operated with the panel and, for the first time, today’s report reveals that the source for these despicable untruths was a Sheffield news agency reporting conversations with South Yorkshire police and Irvine Patnick, the then MP for Sheffield Hallam.

The report finds that this was part of police efforts

“to develop and publicise a version of events that focused on…allegations of drunkenness, ticketlessness and violence”.

In terms of changing the record of events, we already know that police reports were significantly altered, but the full extent was not drawn to Lord Justice Taylor’s attention. Today’s report finds that 164 statements were significantly amended, and that 116 explicitly removed negative comments about the policing operation, including its lack of leadership.

The report also makes important findings about particular actions taken by the police and coroner while investigating the deaths. There is new evidence which shows that police officers carried out police national computer checks on those who had died, in an attempt, and I quote directly from the report,

“to impugn the reputations of the deceased”.

The coroner took blood alcohol levels from all of the deceased, including children. The panel finds no rationale whatsoever for what it regards as an “exceptional” decision. The report states clearly that the attempt of the inquest to draw a link between blood alcohol and late arrival was “fundamentally flawed”, and that alcohol consumption was

“unremarkable and not exceptional for a social or leisure occasion”.

Over all these years, questions have been raised about the role of the Government, including whether they did enough to uncover the truth. It is certainly true that some of the language in the Government papers published today was insensitive, but, having been through every document—and every Government document including Cabinet minutes will be published—the panel found no evidence of any Government trying to conceal the truth. At the time of the Taylor report, the then Prime Minister was briefed by her private secretary that the defensive and “close to deceitful” behaviour of senior South Yorkshire officers was “depressingly familiar”. It is clear that the then Government thought it right that the chief constable of South Yorkshire should resign. But, as the right hon. Member for Leigh has rightly highlighted, Governments then and since have simply not done enough to challenge publicly the unjust and untrue narrative that sought to blame the fans.

Thirdly, and perhaps most significantly of all, the Bishop of Liverpool’s report presents new evidence that casts significant doubt over the adequacy of the original inquest. The coroner, on the advice of the pathologists, believed that victims suffered traumatic asphyxia leading to unconsciousness within seconds, and death within a few minutes. As a result, he asserted that, beyond 3.15 pm, there were no actions that could have changed the fate of the victims, and he limited the scope of the inquest accordingly. However, by analysing post-mortem reports, the panel has found that 28 people did not have obstruction of blood circulation, and that 31 did have evidence of heart and lungs continuing to function after the crush. That means that individuals in those groups could have had potentially reversible asphyxia beyond 3.15 pm, which is in contrast to the findings of the coroner and a subsequent judicial review. The panel states clearly that

“it is highly likely that what happened to those individuals after 3.15 pm was significant”

in determining whether they died.

The conclusions of this report will be very harrowing for many of the families affected. Anyone who has lost a child knows that the pain never leaves you, but to read a report years afterwards that says

“a swifter, more appropriate, better focused and properly equipped response had the potential to save more lives”

can only add to that pain

It is for the Attorney-General to decide whether to apply to the High Court to quash the original inquest and seek a new one. In that capacity, he acts independently of Government, and he will need to examine the evidence himself. It is clear to me, however, that the new evidence in today’s report raises vital questions that must be examined, and the Attorney-General has assured me that he will examine this new evidence immediately and reach a decision as quickly as possible. Ultimately, however, it is for the High Court to decide.

It is also right that the House should have an opportunity to debate the issues raised in this report fully. My right hon. Friend the Home Secretary will take forward a debate in Government time relatively quickly when the House returns in October.

I want to be very clear about the view that the Government take about these findings and why, after 23 years, this matters so much not just for the families, but for Liverpool and our country as a whole. What happened that day, and since, was wrong. It was wrong that the responsible authorities knew that Hillsborough did not meet minimum safety standards, yet still allowed the match to go ahead. It was wrong that the families had to wait for so long, and to fight so hard, just to get to the truth. It was wrong—quite profoundly wrong—that the police changed the records of what happened and tried to blame the fans. We ask the police to do difficult and often very dangerous things on our behalf, and South Yorkshire police is a very different organisation today from what it was then, but we do the many, many honourable policemen and women a great disservice if we try to defend the indefensible.

It was also wrong that neither Lord Justice Taylor nor the coroner looked properly at the response of the other emergency services. Again, these are dedicated people who do extraordinary things to serve the public, but the evidence from today’s report will make very difficult reading.

With the weight of the new evidence in this report, it is right for me today, as Prime Minister, to make a proper apology to the families of the 96 for all they have suffered over the past 23 years. Indeed, the new evidence with which we are presented today makes it clear, in my view, that these families have suffered a double injustice: the injustice of the appalling events—the failure of the state to protect their loved ones and the indefensible wait to get to the truth; and then the injustice of the denigration of the deceased—that they were somehow at fault for their own deaths. On behalf of the Government and indeed our country, I am profoundly sorry that this double injustice has been left uncorrected for so long.

Because of what I have described as the second injustice—the false version of events—not enough people in this country understand what the people of Merseyside have been through. This appalling death toll of so many loved ones lost was compounded by an attempt to blame the victims. A narrative about hooliganism on that day was created that led many in the country to accept that somehow it was a grey area. Today’s report is black and white: the Liverpool fans

“were not the cause of the disaster”.

The panel has quite simply found “no evidence” in support of allegations of

“exceptional levels of drunkenness, ticketlessness or violence among Liverpool fans…no evidence that fans had conspired to arrive late at the stadium”

and

“no evidence that they stole from the dead and dying.”

I am sure that the whole House will want to thank the Bishop of Liverpool and his panel for all the work they have done. I am sure that both sides of the House will join me in paying tribute to the incredible strength and dignity of the Hillsborough families and the community that has backed them in their long search for justice. While nothing can ever bring back those who were lost, with all the documents revealed and nothing held back, the families, at last, have access to the truth. I commend this statement to the House.

[Edward Miliband (Doncaster North) (Lab)]

I thank the Prime Minister for his statement and join him in remembering the 96 people who died at Hillsborough, the hundreds more who were injured and all their families and friends. Today we also remember all those who had to suffer the trauma of being there that day.

Let me state right up front an uncomfortable truth for us all: it shames us as a country that it has taken 23 years to get to the truth about what happened at Hillsborough. The Prime Minister was right today to offer an unreserved apology, but all Governments during this period bear their share of responsibility for the failure to get to the truth, so we on the Opposition Benches also apologise to the families that we did not do enough to help.

What brings us here today, as the Prime Minister said, is not just the tragedy of Hillsborough; it is that the victims of the tragedy and the people of Liverpool were systematically smeared and portrayed as its perpetrators. Imagine for a moment waving a loved one off as they go to a football match, and then the impossible grief of that loved one not returning. Then imagine being unable to grieve in peace, but facing two decades of torment, a cloud of suspicion, innuendo and downright lies spread about the person you loved—lies about rushing the gate, lies about ticketless fans, lies about the drunkenness of the victims. That is what the Hillsborough families have had to endure from day one of this tragedy, and while they spoke the truth to power whenever they could, the powerful did not hear.

Nothing could compensate for what the families have suffered, but I pay tribute to all the victims’ families for their 23-year campaign for the truth. Without the efforts of the Hillsborough Family Support Group, the Hillsborough Justice Campaign and Hope for Hillsborough, the truth would have remained hidden and we would not be here today. I also commend the work of the Liverpool Echo, which kept the campaign going, as well as my right hon. Friend the Member for Leigh (Andy Burnham) and my hon. Friends the Members for Garston and Halewood (Maria Eagle), for Liverpool, Walton (Steve Rotheram) and for Halton (Derek Twigg). Most of all, I pay tribute to all the people of Liverpool and the people across the country who have stood with the families in the dark times, and to every single person who campaigned for this day to come.

Rightly, as the Prime Minister said, it is the families who have had first access to the report. People will want, over many days, to scrutinise properly all the documents that have been released, and I welcome the Prime Minister’s decision to have a debate in October. Some things, though, have been clear for a long time and will be clearer after the publication of the report today, and I want to put them on the record.

The tragedy was caused not by fans but by an unsafe ground and terrible mistakes and negligence in policing. There was a systematic attempt by some in the police to cover that up after the event and, disgracefully, to spread the blame to the fans, and they were aided and abetted by parts of the media. Finally, it is clear that the original inquest was hopelessly inadequate, declaring the so-called 3.15 cut-off on the assumption that all those who died had sustained fatal injuries by that time, when in fact the post-mortem records show that not to be the case and, tragically, that some of the victims could have been saved.

The picture is not one of irresponsible victims, but innocent victims let down by the South Yorkshire police, the emergency services, the Sheffield coroner and the wider public authorities. It is a picture not just of a tragedy, but of a gross injustice. The victims were not only blamed by those who were supposed to protect them, but they were blamed by those who were themselves responsible for the disaster.

After truth must come the best justice that can be provided 23 years late, so let me ask the Prime Minister three questions. The first is about the possibility of new inquests. I welcome what he said about the Attorney-General, but will he reaffirm the urgency, which I am sure he and the Attorney-General recognise, of making that decision? Secondly, today’s revelations also raise profound questions about the behaviour of the public authorities and the police, so what steps does he imagine those authorities might be able to take in response to the panel’s findings and does he believe that there is any way to hold those who were responsible to account? Thirdly, does the Prime Minister agree with me that, just as he has apologised on behalf of the Government and so too has Sheffield Wednesday on behalf of Hillsborough, the same should be forthcoming from all those who wronged the victims, their families and supporters, including those in the media, particularly The Sun newspaper?

This is a day that has been far too long in coming. To the families we say: we are deeply sorry for your loss and deeply sorry for the pain you have suffered. We sincerely hope that today marks a day of truth, so that, finally, you can grieve in peace.

[The Prime Minister]

I thank the right hon. Gentleman for what he said and the way in which he said it. As he put it, this has taken too long, but all parties have had to come together and work together to make this happen. He is absolutely right to commend the local groups, the local press and the local MPs for keeping this issue alive and making sure that we reached this point.

As the right hon. Gentleman said, after truth should come justice, and I shall try to answer his three points as best I can. On the inquest, yes, it is absolutely urgent. We have to look at the Coroners Act 1988, which says that once an inquest has been held a fresh inquest can be held only if the High Court quashes the original inquest and orders a fresh one. The High Court will consider an application only if it is made by the Attorney-General or with his consent. That is a key decision-making role for him: he has to stand aside from Government to do so, but all the things that I said in my statement are relevant.

As for what other authorities are responsible, and whether further steps should be taken, again, in this country we have, quite rightly, independent authorities for prosecution and the rest of it. They will want to study what is in the report and come to their own conclusions.

On the point about apologies, the right hon. Gentleman is absolutely right to say what he said. The important thing about making an apology is to think very carefully why one is necessary. In this case, it is absolutely necessary: there is new evidence which is vital in reaching this conclusion. The other point about making an apology is that you should make one only when you really mean it. My understanding of this long history is that apologies have sometimes been given that have not been fully meant, and not been properly made. My advice to others—and it is their decision—is think it through, and understand the extent of hurt, not just of the families but on Merseyside more widely, then do it properly.

[Stephen Mosley (City of Chester) (Con)]

May I thank the Prime Minister for his statement? His statement and the release of the papers will be welcome not just on Merseyside but across the country. He is aware of my constituent, Mrs Anne Williams, whose 15-year-old son, Kevin, died on that awful day in April 1989, and her 23-year battle to find out the truth behind her son’s death, and in particular, to overturn the 3.15 cut-off time in the original inquest. She has made several requests to the Attorney-General that have been turned down, and has gone as far as the European Court of Human Rights. Now that the report by the independent panel has been published, will my right hon. Friend encourage the Attorney-General to look favourably on ordering a new inquest into Kevin’s death?

[The Prime Minister]

May I offer my condolences again to Mrs Williams and to all the family members affected by Kevin’s tragic death, which was one of the many that were originally dealt with in that single inquest? As I have said, now that the report is out, there is an opportunity for the Attorney-General to study the evidence and make that recommendation to the High Court, which many people, including Mrs Williams, will want to see.

[Andy Burnham (Leigh) (Lab)]

I thank the Prime Minister for every single word of his statement today—their value in Liverpool simply cannot be calculated.

The statement comes far too late for many, of course, but finally, the full horror of Hillsborough has been revealed: a catalogue of negligence, appalling failure and sheer mendacity; a tragedy that should have been prevented, lives that should have been saved; devastating truths made far worse, not better, by the passage of time; a crude 3.15 cut-off, with no legal, medical or moral justification; parents hearing only today what happened to their children, because people whose job it was to protect them turned against the victims and the bereaved to protect themselves; a monumental cover-up, and a sickening campaign of vilification against victims, grieving families, traumatised survivors and a city in shock.

Does the Prime Minister agree with me that today the names of the 96 and of the Liverpool supporters who were at Hillsborough have been emphatically cleared? In thanking him and the Home Secretary for supporting the disclosure process that I initiated, may I ask him to continue to work with us to right these wrongs and, at long last, to bring justice for the 96?

[The Prime Minister]

I absolutely will continue to work with the right hon. Gentleman on this issue. He is right that the names of the 96 have been cleared. Above all, I pay tribute to the work that he has put in with huge passion and dedication on this issue—it was a brave and right decision to set up the panel; it was not easy, as there have been previous inquiries, judicial reviews and the rest of it, but it was undoubtedly the right decision—and to what he has done to help people understand the nature of what I call this double injustice. There was an injustice about fact—about these dreadful things that happened that were not properly accounted for—but also an injustice of narrative and an inaccurate version put around which, as he put it quite rightly, means that the passage of time has made these things worse, not better.

[Simon Hughes (Bermondsey and Old Southwark) (LD)]

I thank the Prime Minister for his full and robust statement. I join him in paying tribute to the right hon. Member for Leigh (Andy Burnham) and his colleagues, who have helped us get to this place today.

I hope that the Prime Minister agrees that today’s evidence clearly vindicates not just Liverpool football club, the families and the campaign, but all those who supported Liverpool and the people of Merseyside in saying that football supporters on that day behaved normally, and they were abused and vilified without justification. I hope that we have learned two lessons. First, when reports are conducted, as they were in two previous years into that ground, someone needs to make sure that they are implemented and not left on the table. Secondly, it should not take 23 years in this case, or a similar period in the case of the Marchioness, for victims to be able to put their case to the public and for a proper inquiry to take account of all those who have something to say. We do not do public inquiries and inquests well in this country; we need to do them much better in future.

[The Prime Minister]

I agree with my right hon. Friend. On the specific point about learning the lessons of health and safety reports and of safety inquiries, I have not had time to study everything in the report, but I think that there will be new, detailed evidence about that issue. On the more general point, it is very important, as I said in my statement, for the people of Liverpool and Merseyside to see that the rest of the country understands why the sense of injustice is rightly as strong as it has been for all these years.

[Steve Rotheram (Liverpool, Walton) (Lab)]

This is a momentous day. On behalf of the people of Liverpool, I thank the Prime Minister and the Leader of the Opposition for their statements of support to the families, supporters and the people of Liverpool. Finally, we have the undeniable truth; a truth that we know now means that many innocent people could and should have been saved; a truth that unequivocally confirms that Liverpool fans were not the cause of the disaster and that drink was not a significant factor; a truth that both vindicates and validates a 23-year campaign for truth and justice. Despite the criticism levelled at us of a “self-pity city”, we were right that there was a deliberate attempt to shift the blame and instigate a cover-up at the very highest level. It is not about retribution—it is about responsibility.

Today, we have made history, but now we must change history, so may I ask the Prime Minister to ensure that the Government co-operate fully with any potential police investigations into the actions of senior police officers and civil servants involved in the 1989 cover-up? Will he personally write to the families of all 96 victims and apologise? Most importantly, I urge him to work with the families, MPs and the Attorney-General so that an application may be made to the High Court to quash the original unsound verdicts of accidental death and to order a fresh coroner’s inquest. Only then will justice be seen to be done.

[The Prime Minister]

Let me pay tribute to the hon. Gentleman, who was not only there on that dreadful day but has the home of Liverpool FC in his constituency. He has campaigned very, very long and hard on this issue, including securing last October’s parliamentary debate, which was a key point in this developing issue and in getting it right.

On the hon. Gentleman’s specific points, I will look carefully at his extremely good idea of writing to the families. It has been vital that they have had this report before anybody else. Of course the Government will co-operate with any investigation. As I have said, all the Government papers that were given to the inquiry—a full trawl was done—will be published, including the Cabinet minutes. That has not been done in cases of peace and war, but it is absolutely essential, in this case, that it is. He is right that this is about responsibility; it is also about respect, and I think that that is what people have rightly earned today.

[Graham Evans (Weaver Vale) (Con)]

I thank my right hon. Friend the Prime Minister and the Home Secretary and pay tribute to the right hon. Member for Leigh (Andy Burnham) and the hon. Members for Liverpool, Walton (Steve Rotheram) and for Halton (Derek Twigg), who were actually at the tragic event. The truth is now out, and it is clear that the families of the 96 were right all along. Will my right hon. Friend please make sure that justice is done, and that justice is seen to be done?

[The Prime Minister]

I thank my hon. Friend for his question. He is right. Justice is being done by the full revelation of all the documents. As I put it in my statement, obviously we cannot bring back those who have been lost, but what we can do for the families is have the full revelation of all the facts and all the documents. In that way, people can rightly see that they have access to the truth. It will take us all a lot of time to study exactly what has been revealed, but, as I tried to outline in my statement, we can see very clearly from the introduction to the report that some of the key points that the families have been making year after year have been thoroughly vindicated.

[Mr David Blunkett (Sheffield, Brightside and Hillsborough) (Lab)]

May I reiterate the appreciation expressed to the panel and the excellent secretariat and thank the Prime Minister and the Leader of the Opposition for their words and for the apology? The families and the people of Merseyside have known all along that the hearts of the people of Sheffield have been with them, as demonstrated on that terrible weekend by the help and support that was given by my own wife, Margaret, who treated some of the injured, and I visited others in hospital. No one in their right mind could have blamed the victims for what happened that afternoon, given where they were in the ground and the consequences for them. May I say to the Prime Minister that one of the lessons that has to come out of this is surely that cover-ups can only cause, and continue to cause, the greatest hurt and harm to those involved, and that in a democracy transparency and openness must be, and always will be, the right way forward to get to the truth?

[The Prime Minister]

The right hon. Gentleman makes an extremely good point that echoes what my right hon. Friend the Member for Bermondsey and Old Southwark (Simon Hughes) said. In holding inquiries and inquests, both of which were held in this case, not enough was done to reveal the full picture, and that is what this report does.

I reiterate that it is very important that all parliamentary colleagues study the report before making more detailed comments on it. For example, the right hon. Gentleman mentioned the role that people in Sheffield played in helping those who were injured. Let me read one small segment of the report:

“Viewed entirely as an operation to deploy ambulances to the stadium, and to transport casualties as quickly as possible to hospital, the…response was rapid and efficient.”

But it then goes on to say that

“this ignores a significant component of the response to a major disaster set out in the”

ambulance service’s

“major incident plan: the provision of appropriate assessment, prioritisation and treatment on site.”

What I am trying to say is that when it comes to criticism of the police, the ambulance service or other emergency services, it is very important to look carefully at what the report itself says.

[John Stevenson (Carlisle) (Con)]

For absolute clarification, will the Prime Minister confirm that all documentation and all papers relating to this matter are now in the public domain?

[The Prime Minister]

It is not quite as simple as that. All the documentation was made available to the panel, and I understand from the panel that it was very pleased with the co-operation it had from everybody—from the Government to the South Yorkshire police to the media. It feels it was given every document it needed to see—over 450,000 documents. The overwhelming majority of those will be published. The only documents that will not be published—this is set out in the way the panel was originally established—are those needed for individual data protection, so some will not be revealed. However, the panel has set out the process by which that will be judged. Let me emphasise that it is a decision for the panel, not for the Government. We have not held back anything.

[Mrs Louise Ellman (Liverpool, Riverside) (Lab/Co-op)]

This is the day when the 23-year-old campaign led by the bereaved, the traumatised and the injured was vindicated. I pay tribute to the work of the Bishop of Liverpool and his panel in demonstrating so conclusively what had been suspected for so long—that there had been a major and systematic cover-up. Can the Prime Minister give us an absolute assurance that in the three key areas—who was responsible for what happened, whether sufficient lives were saved, and the critical issue of the inquest—he will keep Parliament informed about progress that can be made so that those who were bereaved and those who remain traumatised will at least start to feel that they are at the beginnings of receiving some kind of justice?

[The Prime Minister]

I can certainly give the hon. Lady that assurance. I think that the panel has done an excellent job, but, to be fair to it, it is not a coroner. Only the coroner can carry out a proper inquest. As I have said, there is very important evidence here for the Attorney-General to consider and to put in front of the High Court, but the panel cannot reach those judgments. Paragraph 60 says:

“It is not possible to establish whether a more effective emergency response would have saved the life of any one individual who died.”

But it then goes on to say, as I quoted in my statement, that

“a swifter, more appropriate, better focused and properly equipped response had the potential to save more lives.”

In the end, you need the precision of coroners’ reports to go into that sort of level of detail, but I think that the panel has done an extremely good job with what it had.

[Sir Peter Bottomley (Worthing West) (Con)]

The Prime Minister has talked about getting it right.

Fourteen people were crushed to death around me at a funeral in El Salvador before this happened. As a Minister, I had to pay our respects to the 39 dead bodies at Heysel stadium.

Both at Hillsborough and at Heysel, people knew that the grounds were inadequate, and people had spoken about that in advance.

Could the Prime Minister say to people who want to be whistleblowers and alert people to dangers that they should be persistent and that their voices should be heard, and that when people afterwards find they have made a mistake, they should be prepared to say so early on?

[The Prime Minister]

My hon. Friend is entirely right in what he says. I think that this will be one of the things that come out of the report. It has been said before, and it has been known before, that there were problems with the ground, but the full extent of the fact that previous events had had similar problems and that there were quite detailed reports about the failings at the ground will be a very important part of the report. As he says, we do need people to whistleblow and to point these things out.

[Keith Vaz (Leicester East) (Lab)]

I also welcome the content and the tone of the Prime Minister’s statement. If, having studied the papers, either he or the Home Secretary finds that there is a case to be made for referring the conduct of the police to the Independent Police Complaints Commission, will he not hesitate to do so?

[The Prime Minister]

I would say to the right hon. Gentleman that people need to study the evidence in the report. The panel had access to all the documentation from the South Yorkshire police that it wanted. It is very important that politicians play their proper role in these things and the independent authorities play their proper role. There will be a lot of evidence that people want to look at before reaching those decisions.

[David Rutley (Macclesfield) (Con)]

I welcome the publication of the report and the Prime Minister’s statement, like many families in Liverpool and across the north-west, but what lessons will be learned about shaping the scope of future inquests and making sure that they have access to all relevant information?

[The Prime Minister]

My hon. Friend asks an important question. I think that to answer it properly I will have to go away and look at all the things that have changed in the nature of establishing inquests and public inquiries, because we have probably made quite a few steps forward. However, to be fair to Lord Taylor and his report, it came down to what the families and others saw as the right conclusion—that a mistake by the police was the principal cause of the problem. One of the deeper problems in this whole case was that after that public inquiry, there was then the questionable inquest and the media narrative that sought to undermine what Lord Taylor had found. My hon. Friend makes the important point that we should try to learn the lessons about how, broadly, to hold inquiries and inquests and how important it is to make sure that they have access to all the information at the time.

[Ian Paisley (North Antrim) (DUP)]

I, too, add my voice to those who have thanked the Prime Minister, not just for his statement but for the sincerity with which it was made, and for the revelation that the appalling vista has become the atrocious truth. However, the sad fact remains that there is no effective sanction against an unwise and careless media. That issue still has to be addressed, and The Sun still has to be faced with the lies that it heaped upon the heads of the bereaved.

[The Prime Minister]

The hon. Gentleman makes an important point. The Leveson inquiry is separately looking at the whole issue of how the press is regulated and how mistakes that are made are properly corrected. I think that everybody, including those in the press, recognises that the current system is not working and needs to be strengthened. There is then the whole question of whether that happens through strengthened self-regulation, independent regulation or statutory regulation, but that is what Leveson is there to look at.

[Alec Shelbrooke (Elmet and Rothwell) (Con)]

I am a very large football fan from a family of football fans, and a number of Members in the Chamber also go to football matches and other sporting events. The hurt and the tragedy of waving loved ones off to a football match, only never to see them again, was compounded by the defamation of their characters afterwards. Will my right hon. Friend the Prime Minister ask the Attorney-General to seek to bring a defamation charge against anybody who was found to have spread these vicious lies? Does he agree that an appropriate starting point to help heal the wounds of Hillsborough would be for tomorrow’s front page of The Sun to feature a picture of the Liverpool football club crest with one word, “Sorry”, written across it in bold?

[The Prime Minister]

I am sure that the Attorney-General will listen carefully to what my hon. Friend says. As I have said, a number of apologies have been made over the 23 years by police, newspapers and others. I think that what matters is that you have to properly think through what has happened, what went wrong, what was got wrong, what it is necessary to apologise for, and then really mean it when you do so. I feel that it is very important the Government apologise as clearly and frankly as I have today because there is proper new evidence showing that the families were right, that an injustice was done, and that that injustice was compounded by the false narrative that, if we are frank, I think lots of people went along with: we all thought there was some sort of grey area and asked why all this was going on. That is why it is necessary to pay tribute to those MPs, newspapers and family groups who kept the faith and kept campaigning because they knew an injustice had been done, they knew it was wrong and they suffered in the way they did. It is for newspapers to decide what to do themselves, and I think it is important that they really think it through and feel it before they do it.

[Maria Eagle (Garston and Halewood) (Lab)]

I join others in thanking the Prime Minister and my right hon. Friend the Leader of the Opposition for the way in which they have apologised on behalf of all of us for what has happened over the past 23 years. I know that it will be of some relief to the families. Even for those of us who have campaigned on this issue for many years, this report is profoundly shocking. Is it not indicative of the utter failure of our legal system that it has taken the suggestion by my right hon. Friend the Member for Leigh (Andy Burnham) and me of a wholly exceptional arrangement to bring out, into the public domain, documents, truths and facts that were already there? This is new evidence only in the sense that it has been published. Does this not have a profound implication for how we deal in future with disasters and things that go wrong? What lessons can we all seek to learn from that?

[The Prime Minister]

The hon. Lady makes an extremely important point. It deserves a proper, thoughtful, considered answer, which is what we should try to address in this debate in the House of Commons. As has been said, there was a public inquiry, a coroner’s inquest and, quite rightly, by the right hon. Member for Blackburn (Mr Straw), a judicial inquiry into what had happened, yet these processes did not turn up what the Bishop of Liverpool and his patient panel, with the full disclosure of information, have turned up. We need to ask ourselves why that happened. What needs to change when we investigate these things? I do not have the answers today, but my right hon. Friend the Home Secretary can think deeply about it before the debate in October.

[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

I thank my right hon. Friend and the Leader of the Opposition for their courageous statements and apologies. Tears of sadness will still be shed in Liverpool, but tears of relief will also be shed that the unvarnished truth is finally out. I remember being a schoolgirl in Liverpool and people were shell-shocked by what happened that day, and that feeling will continue for many years to come. I am equally shell-shocked by the suggestion that 164 statements were doctored by the police, which suggests a level of criminal conspiracy that is absolutely shocking. Will my right hon. Friend the Prime Minister ask the Home Secretary and whoever else can make this decision to start pursuing criminal charges against the people involved?

[The Prime Minister]

I know that my hon. Friend had a school-friend who died on that terrible day and I quite understand why she speaks with such power and force about it. The figures on the police statements are shocking. We all need to take time and read the report in full and try to see the full detail of what happened on that day. Obviously, any decisions about prosecution are for the relevant authorities but, as Members have said, it is shocking to read this. In the time that I have had this morning, I have not been able to go through it in great detail—I have seen the overview of what the panel has found and had a meeting with the Bishop of Liverpool last night—but even that completely takes your breath away when you read some of the things that he has found.

[Alison McGovern (Wirral South) (Lab)]

No words in the English language are good enough to describe the dignity, grace and courage shown by the families of the 96 loved ones we lost at Hillsborough. The police failed them, then the legal system failed them, but they never failed. Today we come together to receive the truth, so I thank the Prime Minister for his apology. Will he join me in hoping that all those who still suffer find some relief today and that all those who have lied and worsened that suffering feel shame in their hearts and say sorry? Will he confirm that the Government will now help us to move from the truth to justice, whether through a new inquest, accountability or further apologies? May it happen quickly.

[The Prime Minister]

The hon. Lady speaks with huge force and power and I agree with her every word. After truth has to come justice. For the families, nothing can bring back the loved ones they have lost, but I hope that, by revealing all this information and by the panel’s patient work in highlighting just how many things they were right about and the authorities were wrong about, they will be able to find greater peace in their hearts about their appalling losses. You never get back the loved ones you have lost, but at some stage you want at least some of the clouds to part and to see that you have got to the truth.

[Gavin Barwell (Croydon Central) (Con)]

I congratulate my right hon. Friend on an incredibly moving statement—as on the Saville inquiry, he struck exactly the right tone—and the right hon. Member for Leigh (Andy Burnham) on setting up the panel. When the Government have had a chance to study the full report, will the Prime Minister report back to the House on whether it sheds any light on why the Taylor inquiry did not have access to all the documents; why it did not examine the response of the emergency services; and what went wrong with the original inquest? Surely one of the ways in which we can honour the memory of the 96 is to ensure that, when future tragedies occur, people do not have to wait this long to find out the truth about how their loved ones died.

[The Prime Minister]

I thank my hon. Friend for raising the key questions, which are for Government to consider, because we are responsible for how these processes work. I do not have the answer today. Public inquiries and coroners’ inquests are supposed to get to the truth. They did not on this occasion and we have to answer why.

[Mr Elfyn Llwyd (Dwyfor Meirionnydd) (PC)]

I congratulate the Prime Minister on his statement and on the fulsome apology that both he and the Leader of the Opposition have made today. The families fought long and hard for truth and justice, and they have glimpsed today the truth, which is unpalatable, disgraceful and frightening. May I therefore ask the Prime Minister to act urgently on this matter, because it needs to be redressed? Families in north Wales were, unfortunately, also affected by this terrible tragedy. Nothing less than justice will suffice, because they now believe that the moral authority of the state is at issue. It is that important.

[The Prime Minister]

I completely understand how those families will feel, now that, through the disclosure of these documents, we have got as close to the truth as I think we ever will. We have to understand, however, that in a democratic country governed by the rule of law it is not politicians who order prosecutions or apologies from others. Everyone has to take their own responsibility, and prosecutions and decisions of that kind must be taken in the proper way.

[Andrew Bingham (High Peak) (Con)]

I thank my right hon. Friend the Prime Minister and the Leader of the Opposition for their moving statements. On this day of truth, I am prouder than ever to be a Member of this House. Does the Prime Minister agree that the impact of this report will be felt not only in Liverpool but by Liverpool fans up and down the country? Many Liverpool fans in my constituency contacted me after the debate last October, and they too will see today as the first day of truth regarding the Hillsborough tragedy.

[The Prime Minister]

I hope that my hon. Friend is right that Liverpool fans the country over—the world over—will feel that way. As I have tried to explain, however, there is something else they need to feel, and that is not just that they have got to the truth but that the rest of the country now understands what this search for the truth was all about. That is so important in righting the wrongs of the past 23 years.

[Mr George Howarth (Knowsley) (Lab)]

The Prime Minister delivered his statement with the clarity and sensitivity of somebody who knows what it is to lose a loved one. With Mr and Mrs Joynes, who then lived in my constituency, I attended a day of the inquest. It was one of the most harrowing events I have ever attended and it was offensive for the reasons the Prime Minister set out, but it was also ineffective, because of the deeply flawed decision on the 3.15 cut-off point. I accept that the Attorney-General has to follow the proper process, but I hope that when he considers the matter he will take into account just how deeply flawed the process was.

[The Prime Minister]

The right hon. Gentleman speaks with much power, having attended the inquest. The point is not only that it was 23 years ago and that inquests and the coroners’ system have moved on, but specifically that the decision on the 3.15 cut-off point, as detailed in the report, seems beyond defence. This has to be done properly, of course, but I hope that those who make the decision will consider that point carefully.

[Mr Robert Buckland (South Swindon) (Con)]

I thank my right hon. Friend and the Leader of the Opposition for their sensitive and entirely proper apologies. On hearing the grim revelation that many statements were deliberately altered, two potential criminal offences came to my mind—misconduct in public office and perverting the course of justice. Does my right hon. Friend share my expectation that any criminal investigation into these matters will be thorough and efficient?

[The Prime Minister]

I say to my hon. Friend, who has experience in these matters, that it is up to the authorities to study the report, what happened, why it happened, what police officers were told they were doing and were meant to do, and all the rest of it. That has to be carefully looked at by the correct authorities.

[Stephen Twigg (Liverpool, West Derby) (Lab/Co-op)]

This is a hugely significant day for my constituents in Liverpool, and on their behalf I would like to thank the Prime Minister for his comments. He spoke about being sorry for a double injustice and about apologies over the past 23 years. I thank him and my right hon. Friend the Leader of the Opposition for the evident sincerity of their apologies today. Will the Prime Minister join me in thanking and paying tribute to the bereaved families and other campaigners for justice for their tireless campaign for truth and justice?

[The Prime Minister]

I certainly join the hon. Gentleman in paying tribute to the families. When someone loses a loved one in the way the 96 families did, it must be tempting for them to try to put it behind them and move on—to find closure in some other way—so the fact that they have bravely campaigned for justice, knowing that they have not had the truth, is huge testament to them. I am grateful for his comments about what the Leader of the Opposition and I said. I feel strongly about this, like lots of people in the country, because until this matter was looked at carefully and really understood, too many people were willing to go along with the line, “Well, it’s all a grey area, it’s all terribly difficult. There’s been an inquiry and a coroner’s report. We’ve had a judicial review.” This shows that they were not good enough. This is not just for the people of Liverpool; it is for the rest of the country to understand what the people of Merseyside have been through.

[Rehman Chishti (Gillingham and Rainham) (Con)]

The issue of the media has been touched on already. Given their despicable behaviour, what specific action would the Prime Minister like to see taken against the media?

[The Prime Minister]

I am grateful for my hon. Friend’s question. Everybody has to study the report and think about the consequences of what they did. What is new in the report is that it is not just about what the newspapers, particularly The Sun, did, but about where the information came from, how it was gleaned and the rest of it. People will want to consider that carefully before working out what to do next.

[Derek Twigg (Halton) (Lab)]

I have several constituents who lost loved ones, and I was in the stadium on the day, so may I thank the Prime Minister and my right hon. Friend the Leader of the Opposition for the tone of their statements and their apologies? We should also recognise the work of the previous Home Secretary, my right hon. Friend the Member for Kingston upon Hull West and Hessle (Alan Johnson), and the current Home Secretary, who ensured that the documents were actually delivered. What we have heard is shocking—I have had a brief glimpse at the report—but it is equally shocking that on almost every single thing that the family challenged, whether on the inquest, the 3.15 cut-off point, the post mortems or the police conspiracy, they have been proved right. That is a scandal. I welcome the fact that there will be a debate, but may we also be kept up to date on what is happening as a consequence of the report, any actions being taken and any lessons learned? The Home Secretary might want to start that when she makes her statement. The key thing is that we are kept up to date. Any documents relating to future decisions must also be made public and made available to the families and others who want to see them.

--- Later in debate ---

[The Prime Minister]

The hon. Gentleman makes a good point. The Home Secretary and the Attorney-General are sitting here and saying that they will keep the House up to date—the Attorney-General with the decisions that he has to make and the Home Secretary with the lessons-learned exercise, which is clearly vital.

[Nigel Adams (Selby and Ainsty) (Con)]

The report has highlighted so many areas where things went tragically wrong, but most importantly it has cleared the victims of any blame. I hope that this will bring relief to the families. Does the Prime Minister agree that the despicable journalism following the tragedy has had a devastating effect on the families, whose loved ones were smeared? Does he, like me and, as we just heard, my hon. Friend the Member for Elmet and Rothwell (Alec Shelbrooke), hope that there will be a full front-page apology in tomorrow’s The Sun and from its proprietor to the people of Liverpool and Liverpool fans everywhere?

[The Prime Minister]

What my hon. Friend says is important. I have answered the question about how others need to face up to their own responsibilities. The newspaper reporting, the false police narrative and all those who coalesced around it not only did damage to Liverpool and the families but led to many in the rest of the country accepting that narrative. So this is not only an apology to Liverpool and Merseyside. It is an explanation to the rest of the country that these families were right and have been vindicated. They should be proud of that.

[Mr Dave Watts (St Helens North) (Lab)]

Is the Prime Minister aware that the author of the article referred to, “The Truth”, Kelvin MacKenzie, is still going around Britain standing by that story and has been employed by the BBC and other media outlets? Does the Prime Minister think that he is a suitable person to be employed by anyone?

[The Prime Minister]

Kelvin MacKenzie needs to face up to his own responsibilities. I have not had time to look at the detail of the media aspects, but we now have an account of what happened, where these false allegations came from, how they got into the newspapers, and what the newspapers, particularly The Sun, did to give them that prominence. Now it is all there, anyone with responsibility needs to face up to their responsibilities, and I very much hope that they will do so.

[Andrew Bridgen (North West Leicestershire) (Con)]

The events in Hillsborough stadium that day were undoubtedly a shocking tragedy. The subsequent investigation, cover-up and media coverage were a shocking travesty. To gain something positive from these awful events, what assurances can the Prime Minister give the House, and what have we learned, to ensure that these failings will not, and cannot, be repeated in the future?

[The Prime Minister]

I thank my hon. Friend for his question. Obviously, in terms of safety at football grounds, huge steps have been taken with all-seater stadiums, much better rules, far better knowledge about how to police football matches, and all the issues with crowd safety and the rest of it. There are no longer a lot of those terrible cages and things that were there in the past, and I think that we live in a different world. In learning from these inquiries, when a disaster such as this takes place it is important that we look at its causes and at what happened, rather than muddle it up with a whole lot of other issues, which I think is what far too many people did in this case.

[Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)]

I associate myself with the many tributes made this afternoon to the families and survivors of Hillsborough, whose tireless search for the truth has led to the publication of the report today. I also welcome the apologies from the Prime Minister and my right hon. Friend the Leader of the Opposition. The documents released confirm what has long been suspected by many: for 23 years a concerted cover-up based on smears and lies was conducted by the police, and others, against the victims and survivors of a terrible, terrible tragedy.

We know that the Prime Minister has had little time this morning to go through the report, but will he please commit to going through it after this debate, so that the families of the 96 know that the pursuit of justice is taking place at the highest level?

[The Prime Minister]

I can certainly give the hon. Lady that assurance. I received the report at 9.30 am. I had a briefing from the Bishop of Liverpool yesterday afternoon, which was very helpful, but I was not able to read the report until this morning before Prime Minister’s questions. I have read the summary, which I recommend to all Members of Parliament. It is a very good summary of what individual chapters find, and it links to the information that has been revealed. I am sure, however, that certain bits will require much closer study. Mention has been made of the alteration of the police reports and the importance of the media narrative, and we must also understand how so many of those things were left to lie for so long.

[Mr Clive Betts (Sheffield South East) (Lab)]

I am sure the Prime Minister will agree that the shocking findings that he revealed in his excellent statement show how right it was to establish the panel, and how right the families’ campaign has been over the years. I was present at Hillsborough on that day, and I was also leader of Sheffield city council. It is therefore relevant for me to reiterate today an unreserved apology on behalf of the city council for its failings in that terrible tragedy.

I revealed and released all my personal papers and documents to the panel, and I am sure the Prime Minister will join me in giving great credit to Ken Sutton and the panel’s support team for the helpful and professional way in which they have gone about their business. That contributed greatly to the production of this detailed and comprehensive report.

[The Prime Minister]

I certainly join the hon. Gentleman in praising Ken Sutton and the team who helped to put the report together. They have done an outstanding job in my view, and I think the way the report was released to the families first was absolutely right.

The hon. Gentleman mentioned that he was leader of Sheffield city council at the time, and it is greatly to his credit that, like others, he revealed all his papers, public and private, to the report. This is not a public inquiry or a coroner’s report. The inquiry is a proper trawl though all the relevant documentation in order to draw conclusions. There may be lessons that we can learn for other cases. Because everything is revealed, a report of this nature could be the right way to get to the truth, rather than a public inquiry.

[Bill Esterson (Sefton Central) (Lab)]

One of those who died was 18-year-old Christopher Devonside. Christopher’s father, Barry, will welcome what the Prime Minister had to say about a potential new inquest, because that is something he and his family have called for, along with many others.

I add my voice to those who have already mentioned accountability and potential criminal proceedings. As a result of what we have heard today, and what is no doubt detailed in the report, Barry and many other families will think such proceedings entirely appropriate.

[The Prime Minister]

The hon. Gentleman is right to raise the issue of accountability, and there are processes through which that is meant to happen. In this case, the chief constable of South Yorkshire offered his resignation right at the beginning, but it was not accepted by the South Yorkshire police authority. We must think through how we can hold public authorities to account and the processes by which that happens. Even 23 years on, it is completely open for the authorities to look at the new evidence and to draw the conclusions they choose.

[Mr Frank Field (Birkenhead) (Lab)]

On behalf of my constituents who lost members of their family, I thank the Prime Minister for his statement, the contents of which this House and the country will find chilling and must hold huge lessons for public services, particularly the police.

The Prime Minister rightly says that there is now a huge amount of information that those of us with an interest in this matter can read and think about carefully, and that obviously includes the Government. When the Government have completed that process, and the Prime Minister is clearer in his mind about the next steps to be taken, will he come to Liverpool and meet the families—given the catastrophic effect that this whole event had on Liverpool and the surrounding region—and tell them first what those next steps will be?

[The Prime Minister]

I have listened carefully to the right hon. Gentleman. There is a lot of merit in what he has said so let me consider it. From everything that I have read so far, the most important next step concerns the role of the Attorney-General and consideration of an inquest. The report has identified a huge number of faults along the road, but in a tragedy such as this, the key determinants of the truth should be the public inquiry and the inquest.

Let me repeat that in the view of the families and of what we subsequently know, Lord Justice Taylor came to the right conclusion about the culpability of the police. The inquest is where major question marks arise, and that is where I think families will rightly focus. If we are thinking about next steps, there are lessons for the Government and a debate in the House, but consideration of an inquest is the most important next step to be taken. As I have said, that is a matter for the Attorney-General, and he has to stand aside from Government. In the end, an inquest can be ordered only by the High Court. That is how the processes work, and it is important that everyone, including the families, understands that.

[Angela Smith (Penistone and Stocksbridge) (Lab)]

I join those who have paid tribute to the members of the panel, and to the thorough way they have discharged their duties. I also pay tribute to the Prime Minister and the Leader of the Opposition for the dignified manner in which they have led the House in its initial response to the findings in the report. The original inquest took place in the city of Sheffield, and the families of those who died will have bitter memories of the process and the conclusions drawn. I therefore ask the Prime Minister to ensure that if and when a new inquest is authorised, it does not take place in Sheffield. It is absolutely imperative that we minimise the distress to the families involved.

[The Prime Minister]

I have listened carefully to the hon. Lady, as, I am sure, did the Attorney-General and Home Secretary. She made a very powerful point.

[Mark Durkan (Foyle) (SDLP)]

I join other hon. Members in welcoming the full and fluent apology from the Prime Minister, and the profound words of the Leader of the Opposition. Those words are authoritative because they rest on the diligent work of the panel that the right hon. Member for Leigh (Andy Burnham) was so right to establish. The Prime Minister will know that Bloody Sunday families and survivors in my constituency have a profound empathy with those Hillsborough families that have struggled with grief compounded by grievance, and endured injustice, insult and indifference. Does the Prime Minister recognise that this report will not only mean that Hillsborough families are overcome with a sense of vindication, but that it will also provoke many other mixed and difficult emotions and issues? Will he ensure that relevant services are supported and supplemented to help the families and survivors of Hillsborough with those needs?

[The Prime Minister]

I am sure that with his experience of Bloody Sunday and the Saville inquiry, the hon. Gentleman is completely right to say that the families will need a lot of support and help as they digest what is in the report. The commonality, as it were, of the two things, is that a Government should not make an apology just because something bad happened some time ago. The apology should be in respect of the fact that there is new information that injustice took place and was allowed to lie for far too long, and that false stories were got up about what happened. That is why an apology is not only right, but the necessary and correct thing to do, and that is where there is common ground between the two issues raised by the hon. Gentleman.

[Andrew Miller (Ellesmere Port and Neston) (Lab)]

On behalf of my constituents who lost family members and friends, I thank the Prime Minister and the Leader of the Opposition for the dignified way in which they have dealt with this very difficult statement.

One of the first questions raised with me by a constituent when I was first elected some 20 years ago was this: who gave the authority to start the misinformation through the police to the media and so on? Is the Prime Minister satisfied that he can identify those persons, and those persons who were subsequently involved in the cover-up to protect the person who started the misinformation? That is a key question. The hon. Member for Suffolk Coastal (Dr Coffey) put it exactly right: there ought to be prosecutions on that point.

[The Prime Minister]

The hon. Gentleman asks the right question. It is necessary to study the report. The families have long believed that, although the Taylor inquiry came to the correct conclusion about police culpability, there was then a move engineered by some police officers—I believe there is evidence in the report about this—to try to put forward an alternative narrative, which was wrong, deeply insulting and very hurtful. That and new evidence on it is contained in the report, which is worth while.

[Yasmin Qureshi (Bolton South East) (Lab)]

I echo the sentiments of the statements of the Prime Minister and the Leader of the Opposition, and thank my right hon. Friend the Member for Leigh (Andy Burnham) for setting up the inquiry. Those who have died cannot come back, but does the Prime Minister agree that their families can be assisted by two things at least? First, although I accept that politicians cannot make the emergency services and public officials apologise, perhaps the Prime Minister could ask the Mayor of London for an apology for the derogatory comments he made about the people of Merseyside many years ago as a result of the Hillsborough disaster. Secondly, in the light of the clear dereliction of duty and negligence by the emergency services and the police, will the Prime Minister consider setting up a compensation fund to make ex gratia payments to the victims’ families, so that they do not have to go through a lengthy legal process to get compensation?

[The Prime Minister]

The hon. Lady makes a number of points. On what the Mayor of London or others have said, the report is important. As I have said, for people right across the country, whether they are in positions of power and influence or not, the report is the proper explanation of what happened. People who thought that something else happened need to come to their senses and realise what actually happened. One of the moments that struck me in trying to understand what happened was when the right hon. Member for Leigh (Andy Burnham) gave that address to the fans on that anniversary. When those of us who are not from Merseyside and who have not followed this as closely as others saw just how many people turned out on that day, we also saw just what an enormous sense of outrage and injustice remained. That was an important moment. It is now for others to understand that the truth is out. Everyone needs to come to terms with it and to make the right arrangements.

[Mr David Hanson (Delyn) (Lab)]

I thank the Prime Minister and my right hon. Friend the Leader of the Opposition very deeply for their comments and apologies, and my right hon. Friend the Member for Leigh (Andy Burnham) for establishing the inquiry in the first place. It will come as some comfort to the families of my constituents who died at Hillsborough on that day.

The issue of accountability is central to the debate today. Has the Prime Minister had any indication as yet on which police force could take forward any future investigation? What process does he expect to undertake to bring to account those who have allegedly taken part in criminal activity?

[The Prime Minister]

I thank the right hon. Gentleman for his question, but we received the report at 9.30 am, so it clearly has not been possible to make those considerations. The Government often—not always—get a public inquiry report and are able to consider it and put more into lining up all the elements that must come next. In this situation, the report was rightly given to the families first. I have had time for a very brief look and some explanation, but the sort of questions he asks will take longer to answer.

[Mr David Anderson (Blaydon) (Lab)]

In welcoming the Prime Minister’s statement and thanking him and the Leader of the Opposition for what they have said, may I raise one point with the Prime Minister? He has mentioned “new evidence” and “new documentation” a number of times, but the truth is that it is not new—the vast majority was old but buried and concealed. We have heard that the Prime Minister at the time was advised by her private secretary that

“the defensive and…‘close to deceitful’ behaviour of senior South Yorkshire officers was ‘depressingly familiar.’”

We have also been told that the report says that no Government have tried to conceal the truth. The real question for politicians is this: what failures did politicians create in not trying to expose the truth?

[The Prime Minister]

Absolutely. The hon. Gentleman has put his finger on it. When I said “new evidence”, I suppose I meant “newly published evidence”. The inquiry has not uncovered things that did not previously exist—they existed but were not published, so their publication is what is new today. The really important point he makes will take careful consideration, and those in government at the time will want to think this through and provide their own answers. The sense I get from the limited look I have had at the report is that advice went to Ministers that the behaviour was “depressingly familiar” and that the chief constable should resign. The question then is whether the output of that advice resulted in enough action by that Government and subsequent ones to blow away the false narrative that was building up. That is a very important question that people will want to consider.

[Chris Bryant (Rhondda) (Lab)]

The Prime Minister has done a good thing today and he has done it well. Surely to God the role of the media should have been to uncover the corruption and the lies, and not to try to mask the corruption in the police or effectively to perpetuate it. I know the Prime Minister is very reluctant to tell people who should make apologies, but I have tried so many times on television and radio programmes to get Kelvin MacKenzie just to say the simple word “sorry” unambiguously, because every ambiguous apology hurts more than saying nothing. Surely to God The Sun tomorrow should just say sorry. Surely to God Kelvin MacKenzie, if he is to go on any media outlet at all, should be saying sorry. For that matter, surely The Spectator should say sorry too.

[The Prime Minister]

I thank the hon. Gentleman for his kind remarks. We should not forget that some media publications stood up for the families, examined the issue and helped to get to the truth. We should therefore not try to blacken the name of everyone in one go. Clearly, The Sun has always been up there because of that appalling article—“The Truth”—and the appalling things written in it. My view is that Kelvin MacKenzie needs to take responsibility for that and he should be very clear about it, but it is for others to decide. My understanding is that The Sun and the police have apologised in the past. Lots of apologies have been made, but the point is that we now have a definitive guide to what happened. Now is the time for not only the proper, heartfelt “I’m sorry”, but the “Here’s what I got wrong and here’s what I regret.” It is like what we say when we deal with our children: sorry is not good enough unless people understand what they screwed up in the first place.

[Kevin Brennan (Cardiff West) (Lab)]

It is clear from the Prime Minister’s welcome and important statement that the prevailing cultures in the Murdoch press, the police, and health and safety, played their part in the disaster and the injustice that followed. Will the Prime Minister undertake to reflect soberly and seriously on health and safety to ensure that there is never a return to the slack culture that led to this tragedy?

[The Prime Minister]

The hon. Gentleman makes an important point. When we talk about trying to deregulate and take small businesses out of health and safety, it is not to say that we do not need higher standards of safety when there are important issues such as large crowds in big public gatherings. However, in recent years, we have had too much form over substance. What really matters in health and safety is the substance and looking at real risks rather than thinking that some micro-business that has nothing to do with health and safety needs the same sort of regulation as a football ground.

[Tom Greatrex (Rutherglen and Hamilton West) (Lab/Co-op)]

I welcome the important statements from the Prime Minister and the Leader of the Opposition this afternoon. Notwithstanding the point that the Prime Minister made about the process, may I reiterate to him the inadequacy of the inquest? Up to 59 of those 96 people could have had a different outcome, judging by the statement he has made today. The people who have been affected will not feel a sense of justice being begun to be done while that flawed, inadequate and shoddy inquest remains on the record.

[The Prime Minister]

The hon. Gentleman makes an important point. There is an entire chapter in the report—chapter 8—on the coroner’s inquiry. There is also an additional entire chapter on the 3.15 cut-off—which is an important point that hon. Members will want to look at carefully—and it seems, from a preliminary reading, to be extremely powerful.

[Jim Shannon (Strangford) (DUP)]

I thank the Prime Minister for his statement and for speaking not just for the Government, but for the whole of the United Kingdom of Great Britain and Northern Ireland. We are deeply indebted to him for that. I was aware of some of the issues, but on TV this morning there was one lady who had lost two children and another lady who had lost one child. The rawness of what took place 23 years ago was clear in their faces, and it is clear from the families of the 96 victims, who live with the grief of what took place. Whenever another inquiry or inquest takes place, as it will, what assurance can the Prime Minister give the House that the sensitivity that is needed for the families, who are still grieving today, 23 years later, will be ensured?

[The Prime Minister]

The hon. Gentleman makes an important point, and I am sure that the Attorney-General, the Home Secretary and others will listen closely to it. If the decision to hold a fresh inquest goes ahead, clearly an enormous amount of thought would have to be put into where it is held, how it is held and how to deal with what are incredibly sensitive issues after 23 years. The hon. Gentleman is absolutely right to raise that, and if that were to happen, we should discuss it nearer the time.

[Mr Speaker]

I thank the Prime Minister and all colleagues for their participation.

Oral Answers to Questions

Lord Cameron of Chipping Norton Excerpts

Wednesday 5th September 2012 Commons Chamber

[Mr Dennis Skinner (Bolsover) (Lab)]

Q1. If he will list his official engagements for Wednesday 5 September.

[The Prime Minister (Mr David Cameron)]

I am sure that the whole House will wish to join me in paying tribute to the servicemen who have fallen since the House last met: Lieutenant Andrew Chesterman of 3rd Battalion the Rifles, Lance Corporal Matthew Smith of 26 Engineer Regiment and Guardsman Jamie Shadrake of 1st Battalion the Grenadier Guards. We send our deepest condolences to their colleagues, friends and loved ones. Their courageous and selfless service to our country will never be forgotten.

Before listing my engagements, I would like to say on behalf of the Government, and I hope the whole House, a word about the huge success this summer of the Olympic and Paralympic games. I want to send all our congratulations on the superb performance of Britain’s athletes and Paralympians. I want to say a huge thank you to the volunteers who put such a smiling face on the games and a large well done to all the organisers. I think that they made the entire country proud and, as they promised, they have indeed inspired a generation.

This morning I had meetings with ministerial colleagues and others, and in addition to my duties in this House I shall have further such meetings later today.

[Mr Skinner]

Is the Prime Minister aware that his Cabinet reshuffle of his B team has not raised a ripple with the general public? On the other hand, those loud boos that greeted the Chancellor of the Exchequer will haunt the posh boys for ever. Why does The Prime Minister not be a man, do the decent thing and call a general election?

[The Prime Minister]

It is very good to see the hon. Gentleman back in such good form. I am sorry that when I was forming my Government of all the talents I could not find him on my speed dial, but I have done something that new Labour never managed: I have taken a miner and put him in the Cabinet, and he is running the railways. I thought the hon. Gentleman would appreciate that. [Interruption.]

[Mr Speaker]

Order. The House must calm down.

[Nadine Dorries (Mid Bedfordshire) (Con)]

Mr Speaker, you will be aware that the Deputy Prime Minister and the Liberal Democrats reneged on a promise to deliver boundary changes in exchange for a referendum on the alternative vote. If the Deputy Prime Minister goes to the Prime Minister and says that he will deliver boundary changes in exchange for state funding of political parties, what will the Prime Minister’s answer be?

[The Prime Minister]

I am not in favour of extending state funding. I think that it is very important that all political parties work hard to attract members and donations. Frankly, when we get those donations we pay credit to people for funding political parties, which is in the public interest.

[Edward Miliband (Doncaster North) (Lab)]

Let me join the Prime Minister in paying tribute to Lieutenant Andrew Chesterman of 3rd Battalion the Rifles, Lance Corporal Matthew Smith of 26 Engineer Regiment and Guardsman Jamie Shadrake of 1st Battalion the Grenadier Guards. They all died serving our country. Their sacrifice will never be forgotten, and our thoughts are with their families and friends.

I also want to join the Prime Minister in paying tribute to everyone involved in the Olympic and Paralympic games—our athletes, our fantastic volunteers and indeed the whole country, which united in support of team GB. It showed our country at its best, it brought Britain together and we should all be proud of the achievement.

After two and a half years in government, the Prime Minister returned from his summer break and told the nation that he now realised it was time to “cut through the dither”. Who did he have in mind?

[The Prime Minister]

The right hon. Gentleman has had all summer to think of a question. Is that really the best he can do?

Let me explain to the right hon. Gentleman what this reshuffle is all about. It is not that there are two economic Departments in our country, the Treasury and Business; I want every single Department to be about the economy. I want the Transport Department building roads; I want the Communities Department building houses; I want the Culture Department rolling out broadband; and I want the Agriculture Department backing British food. This is a Government who mean business, and we have got the team to deliver it.

[Edward Miliband]

The Prime Minister mentions the reshuffle; it is good, of course, to see the Chancellor still in his place. I have to say to the Prime Minister that he has come up with an ingenious solution to the problem of his part-time Chancellor: he has appointed another one—the former Justice Secretary, the right hon. and learned Member for Rushcliffe (Mr Clarke). It is a job share; we will see how they get on.

I do not know whether the Prime Minister remembers, but a year ago he published his national infrastructure plan alongside the autumn statement. He said at the time of that plan that it was an

“all-out mission to unblock the system”.

Can he tell us, one year on, how many of the roadbuilding projects announced in that plan have actually started?

[The Prime Minister]

First, I am glad that the right hon. Gentleman mentioned the issue of Chancellors, because I have got my first choice as Chancellor, while he has got his third choice as shadow Chancellor. Apparently, he still has to bring in the coffee every morning—that is how assertive and butch the Leader of the Opposition really is.

The right hon. Gentleman asks about infrastructure. If we look at what is planned by this Government, we see that between 2010 and 2015 we will be investing £250 billion in infrastructure. That compares with just £113 billion between 2005 and 2010. That shows that he has absolutely not got a clue.

[Edward Miliband]

The difference between the shadow Chancellor and the Chancellor is that the shadow Chancellor was right about the economy and the Chancellor was wrong. I have to say that the Paralympic crowd spoke for Britain.

However, it is another Prime Minister’s questions, we are back and, characteristically, the Prime Minister does not answer my question. The answer is that none of the roadbuilding programmes announced in his grand infrastructure plan has started.

Let us look at another grand claim the Prime Minister made. In March, he published his housing strategy. He said:

“our housing strategy is beginning to get Britain building again.”

Before he starts talking up his next announcement about housing, let us look at the effect of the last one. Can he tell us how many houses have started to be built since his announcement?

[The Prime Minister]

Housing starts are up 30% since 2009, which was the lowest rate of house building since the 1920s. That is what the right hon. Gentleman’s Government left. He praised his shadow Chancellor to the gunnels, but let us remember that it was the shadow Chancellor who landed us in this mess. Who was the City Minister when the City went bust? The shadow Chancellor. Who was the man who gave us the biggest budget deficit in the developed world? The shadow Chancellor. That is what that team has delivered and that is why the British people will never trust them again.

[Edward Miliband]

I think that sometimes the right hon. Gentleman forgets that he has been Prime Minister for two and a half years. He has got to defend his record, and he cannot defend his record. Again, he did not answer my question. I asked him about what had happened to housing starts since he made his announcement. The reality is that housing starts have fallen since then. They are 24% lower than they were a year ago and lower than they were at the time of the last Labour Government. Another grand claim has not materialised.

Now, let us talk about planning. In March, after 18 months of consultation, the Prime Minister hailed his flagship planning policy and said that it was the biggest revolution in 60 years. But on Sunday he said that he was “frustrated” by the system and the

“hoops we have to jump through”

and that he wanted to change it again. How is he so incompetent that he brings in a flagship planning Bill, calls it a revolution, and then six months later says that it is not fit for purpose?

[The Prime Minister]

The national planning statement that we inherited from Labour was over 1,000 pages; it is now down to just 52 pages. We have radically simplified the planning system—something that the right hon. Gentleman should be praising rather than attacking. He might want to notice that today the World Economic Forum has come out and said that for the first time in a decade, instead of Britain going down the world competitiveness ratings, we are back in the top 10 and rising. Let me read what it said:

“The United Kingdom…continues to make up lost ground in the rankings this year”—

lost ground that happened under the last Labour Government. There is a reason for that—it is because this Government are cutting regulation, cutting corporate tax, taking people out of tax, getting our businesses moving right across our country, investing in the regional growth fund, and delivering more apprenticeships than any previous Government. That is what we are delivering; what has he done over the summer? Where are the policies on welfare? Nothing. Where are the policies on education? Nothing. Where is the great plan for our economy? His only answer to a debt crisis is to spend more, borrow more, and put up the debt.

[Edward Miliband]

Back to the bunker after that one, I am afraid. I think the crimson tide is back as well.

Over the past two and a half years we have seen announcements on infrastructure—failed; announcements on housing—failed; announcements on planning—failed. What is the reason for this economic failure? The reason is that the Prime Minister’s fundamental economic approach is wrong. After the summer we now know that in his whole two and a half years as Prime Minister the British economy has not grown at all. So why does he not admit it? The real problem is this: plan A has spectacularly failed.

[The Prime Minister]

Let me tell the right hon. Gentleman what is actually happening in our economy, which is that we are seeing the private sector growing and expanding. There are 900,000 more people employed in the private sector than there were two years ago. We are now a net exporter of cars and motor vehicles for the first time since the 1970s. We are seeing the fastest rate of business creation that we have seen for decades. That is what is happening. Our economy is rebalancing. There is growth in the private sector. Our exports to China are up 72%, to India up 94%, and to Russia up over 100%. That is what is happening. It is a hard road, it is a difficult road, but we will stick to that road because we will deliver for the British economy.

[Edward Miliband]

We are in the longest double-dip recession since the second world war. How out of touch does this Prime Minister sound? [Interruption.] I have to say to the Tory Members of Parliament that they can go to their constituents and start trying to blame everyone else, but they have been in government for two and a half years. It has happened on their watch.

We saw a reshuffle yesterday. The Prime Minister brought back the right hon. Member for Yeovil (Mr Laws), who had been sacked; he promoted the Culture Secretary, who should have been sacked; and he left in place the part-time Chancellor, who the whole country knows should be sacked. It is the same old faces and the same old policies—a no-change reshuffle. If the Prime Minister really wants to cut through the dither, there is no place like home.

[The Prime Minister]

The big difference in British politics is that I do not want to move my Chancellor; the right hon. Gentleman cannot move his shadow Chancellor. The fact is that in spite of all the economic difficulty this is a strong and united Government, and in spite of all the opportunity this is a weak and divided Opposition. [Interruption.]

[Mr Speaker]

Order.

--- Later in debate ---

[The Prime Minister]

My hon. Friend raises a very important point, which is that the growth of the economy around Aberdeen, obviously linked to North sea oil, has been extremely successful. I want to see that continue to expand and I will listen very carefully to what he says and look at what the British Government can do to help provide that extra capacity, which I have seen for myself.

[Mr Geoffrey Robinson (Coventry North West) (Lab)]

Q2. Will the Prime Minister confirm that we learned over the summer that the UK borrowed £9.3 billion more in the first four months of this year than it did in the corresponding period last year?

[The Prime Minister]

We have cut the budget deficit by a quarter in two years but, obviously, it is immensely challenging to get the deficit down. I note that Labour’s answer to getting the deficit down is to borrow more—to borrow an extra £200 billion. The one way you cannot get borrowing down is to put borrowing up.

[Nicola Blackwood (Oxford West and Abingdon) (Con)]

Q3. My constituents were delighted when BMW announced the investment of £250 million to increase Mini production and called its Oxford plant the heart and home of this great British success story. Does the Prime Minister agree that this kind of inward investment is vital to kick-start the economy and that we must do more to prioritise policies to make the UK more attractive to investors?

[The Prime Minister]

My hon. Friend and I have neighbouring constituencies and many constituents who work at BMW at the old Cowley works. It is very good news that BMW is investing another £250 million in that plant on top of the £500 million announced last year. That is safeguarding over 5,000 jobs in the Oxford, Swindon and Hams Hall plants. It is part of a huge recovery story for the British motor manufacturing industry. We are now net exporters. That has not happened since the 1970s and it is a huge credit to Jaguar Land Rover, Nissan, Toyota, BMW—to all those companies that are investing in and choosing Britain. They are not choosing Britain because of the weather; they are choosing Britain because we have cut corporation tax, because we are investing in apprenticeships, because we are investing in the infrastructure that they need, and because they know that this is a country open to business.

[Alison McGovern (Wirral South) (Lab)]

Poor Wirral families face the indignity of food banks, and Save the Children is launching its first ever public campaign for British children. What is the Prime Minister doing to help?

[The Prime Minister]

What we are doing is making sure that we target help on the poorest families in our country, which is what we have done through the tax credit system. At the same time, we should praise all the voluntary and big society efforts to help the poorest families in our country.

[Mel Stride (Central Devon) (Con)]

Q4. Will my right hon. Friend join me in paying tribute to the 23 million people in our country who work with such commitment in the private sector—the sector that generates the wealth that this country so desperately needs? Will he also welcome, as I do, the fact that under this Government we now have more people employed in the private sector than at any time in our history?

[The Prime Minister]

The point my hon. Friend makes is very important. If you look at the figures and include all of the financial sector, you will see that there are more people employed in the private sector today in Britain than at any time in our history. [Interruption.] Oh, the shadow Chancellor says that that is because we are in recession. It is because companies are choosing to employ people and the private sector is getting larger, which is good news. Employment is up 201,000 this quarter; unemployment is down 46,000 this quarter; the claimant count has fallen; the rate of unemployment is down; youth unemployment is down—I would have thought that the whole House would welcome those figures.

[Helen Jones (Warrington North) (Lab)]

Q5. Last Sunday the Prime Minister told us that there should be no more excuses for failure. Given that his policies have produced the longest double-dip recession since the war, with output down, borrowing up and a collapse in consumer confidence, is his failure to apologise because he does not take his own advice, or because he considers that a record of astounding success?

[The Prime Minister]

This comes from an hon. Lady who served in a Government who, after 13 years, delivered us the longest and deepest recession since the war and who gave us the biggest budget deficit of virtually any country in the developed world. Of course, it takes time to get yourself out of a hole as deep as the one that was dug by the shadow Chancellor and the leader of the Opposition.

[Gavin Williamson (South Staffordshire) (Con)]

Q6. Over the summer, Jaguar Land Rover announced the creation of 1,100 additional jobs at its Castle Bromwich plant. That is in addition to the 750 jobs that it is creating in my constituency of South Staffordshire. Does my right hon. Friend agree that there is a stark contrast between the rhetoric of the last Labour Government about reviving the automotive industry, and the actions and delivery of this Government?

[The Prime Minister]

My hon. Friend is absolutely right. In the past two years, Jaguar Land Rover has hired an extra 8,000 new workers. That is a massive success story for the west midlands and for a great British brand. It is also, let us say so, a big success story of massive inward investment from the Indian parent company. We should praise all those things and recognise that we have to do even more to make Britain a really business-friendly country, with low rates of regulation, low rates of tax and lots of support for apprenticeships and infrastructure. That is what we are delivering, and we will continue to do so.

[Stephen Timms (East Ham) (Lab)]

Q7. Hundreds of young people from outside Europe chose London Metropolitan university, confident in British higher education. The Prime Minister needs to tackle visa fraud, but will he lift the threat to deport students who have paid their fees and complied fully with all the rules? Why is he so damaging the standing of British universities around the world?

[The Prime Minister]

I know that the right hon. Gentleman speaks with considerable experience and wants to speak up on behalf of his constituency. Having looked at this case and at the action that the Border Agency has taken, it seems to me that there were some real abuses. I want Britain to be open to students. Let us be clear: anyone who can speak English and who has a university place is able to come here and study at our universities, but the Minister for Immigration has rightly been very hard in closing down bogus colleges and in ensuring that action is taken when good universities, like this one, are not meeting the rules. That must be right if we are to control immigration.

[Richard Harrington (Watford) (Con)]

Is my right hon. Friend the Prime Minister aware that in Watford in the last quarter of 2012, for which the numbers have just come out, 327 new companies were incorporated? That is a record and is way beyond anything in history. I think he will agree that that shows that the Government’s policy of encouraging private enterprise is succeeding.

[The Prime Minister]

My hon. Friend makes an important point. As I understand it, 2011 saw the fastest rate of new business creation of any year in decades. That is what our economy requires. It takes time and patience, because we need a massive rebalancing away from the public sector and towards the private sector, and we need other industries, not just finance and retail, to succeed. We want to see business regeneration right across our country. That rebalancing takes time and is difficult, but it is the only long-term way out of the economic difficulties that we were left by the Labour party.

[Paul Blomfield (Sheffield Central) (Lab)]

Q8. The Prime Minister is right to celebrate the most extraordinary Paralympics, which we are seeing at the moment, and the exceptional achievements of Team GB within those games. What, then, does he say to Baroness Grey-Thompson and the other Paralympians who warned this week that his decision to cut disability living allowance will prevent disabled people from participating in sport and threaten the legacy of the London games?

[The Prime Minister]

The message that I would give to everyone in ParalympicsGB—which is, of course, a separate team from Team GB—is a huge congratulations on their massive success at the games. It has been truly inspiring to see on television or in person, which I have had the privilege of doing, the absolutely packed stadiums for the Paralympics. That is not something that everyone expected, but it says a lot about our country and our people, and is great for the Paralympics.

To answer the hon. Gentleman’s question directly, we are not cutting the money that is going into supporting disability. We are reforming the system by replacing disability living allowance with the personal independence payment. That is all about recognising people’s needs. It has been worked up very carefully with the disability lobby and I think that it will be an improvement on the current system.

[Mark Garnier (Wyre Forest) (Con)]

Q9. The Prime Minister is well aware of the lack of capacity at Britain’s airports. In seeking to resolve that problem, will he consider the opportunity presented by regional airports, such as those in Birmingham, which could help to rebalance the economy?

[The Prime Minister]

My hon. Friend makes a very good point about regional airports. Let me be very frank about this: these very large infrastructure projects are extremely difficult for individual Governments to take on and deliver. What we need to do is build a process that will hopefully have cross-party support, so that we can look carefully at the issue and deliver changes that will address the problems of capacity that we will have in future years and the issue of the UK’s hub status. I hope to make an announcement about that in the coming days, but it is important that we work across party lines, because this will not happen unless parties sign up to a process that can deliver.

[Mrs Anne McGuire (Stirling) (Lab)]

I just wonder whether I can cut through the waffle that the Prime Minister gave us in answer to the question about disability living allowance. The reality is that 600,000 disabled people will lose an extra cost benefit. Instead of just giving warm words to disabled people in this country, why does he not take aside his immovable Secretary of State for Work and Pensions and say to him that it is time we thought again on this one?

[The Prime Minister]

The move from disability living allowance to personal independence payments has been an exercise of huge consultation with the disability lobbies to try to ensure that we get this right. The fact is, there are hundreds of thousands of people on DLA who have never had a recheck since they started to take on that benefit, and many others—I know this as a parent who filled out the form myself—who have to fill out reams of answers to questions without the proper medical check that would actually get them the benefit quicker. We are moving from an old system that is out of date to a new system that will actually help disabled people.

[Chris Heaton-Harris (Daventry) (Con)]

Q10. Selective dorsal rhizotomy is the name of an operation that allows children with spastic cerebral palsy, like my constituent Holly Davies, to leave their wheelchair behind and walk independently. It has been carried out successfully thousands of times in the United States but is available only privately in the UK as the National Institute for Health and Clinical Excellence refuses to allow the operation on the NHS. Will the Prime Minister look at the situation and help me, and the families across the country who are currently raising money for their children to have the operation, to get NICE to change its mind?

[The Prime Minister]

I will certainly look closely at that. I quite understand, as a parent of a very disabled child who had cerebral palsy, that if there was anything that a parent could do to get their child out of the wheelchair, they would want that to happen. I have looked at this case, and NICE actually says that the operation is a treatment option for some children and young people, but it cautions against the potentially serious complications, because it is an irreversible operation with risks involved. However, I will look at the matter very carefully and see whether there is anything more that NICE should consider.

[Mr David Anderson (Blaydon) (Lab)]

Q11. Whenever the Prime Minister is faced with industrial dispute in this country, he always advises the trade unions to go for reconciliation and arbitration. In the interests of fairness, will he speak to his new Health Secretary and ask him to involve himself in the dispute at Northumbria Healthcare NHS Trust, to ask its board to do what the union is asking for and refer the dispute to the NHS Staff Council for resolution?

[The Prime Minister]

The new Health Secretary will have been listening carefully to that, and I am sure he will be able to discuss the matter with the hon. Gentleman.

[Mr Alan Reid (Argyll and Bute) (LD)]

It is very important that motorists have the right to renew their car tax at the post office. Not everybody has internet access. The Driver and Vehicle Licensing Agency contract is up for renewal soon. Will the Prime Minister please ensure that the contract stays with the Post Office?

[The Prime Minister]

My hon. Friend makes an important point, particularly as he represents a very far-flung rural constituency with people living across a number of different islands. I am sure the Business Secretary will have been listening carefully to what he says, although the Government can make a limited amount of interference in such contracts.

[Gavin Shuker (Luton South) (Lab/Co-op)]

Q12. Does the Prime Minister have full confidence in his police and crime commissioner in Hampshire?

[The Prime Minister]

What I would say about the police and crime commissioners is that we have not yet had the elections. We are going to have elections in November, and this is a very good opportunity to broadcast from this House what an important set of elections those are. I want to see a new form of accountability coming through in our police forces, and this is an excellent reform. I am sure that many people want to turn out and vote, hopefully for their local Conservative candidate.

[Andrew Percy (Brigg and Goole) (Con)]

Over the summer, a number of communities across Brigg and Google, including Swinefleet and Crowle, suffered flooding, in part because our drainage dykes are not cleared out as drainage boards fear prosecution under conservation of habitats legislation. Will the Prime Minister meet his new Environment Secretary and take away that threat of prosecution, so that drainage dykes that were built and dug to protect property can do their job?

[The Prime Minister]

As someone who represents a constituency that has frequently been subject to very bad flooding, I know how many frustrations there can be in local communities when things that need to be done do not get done quickly enough. Sometimes that is the fault of different agencies, sometimes that of landowners, sometimes that of local authorities. All sorts of issues have to be crunched through, but I am sure that the Environment Secretary will have listened closely to what my hon. Friend said.

[John McDonnell (Hayes and Harlington) (Lab)]

Will the Prime Minister confirm, with no ifs or buts, that there will be no third runway at Heathrow airport while he leads his party?

[The Prime Minister]

Let me say clearly that, while I believe that we need to establish a form of review that will bring parties together and make a decision about airport capacity, I will not break my manifesto pledge.

[Mr John Baron (Basildon and Billericay) (Con)]

A letter from and meeting with the Secretary of State for Defence has confirmed that the 2nd Battalion the Royal Regiment of Fusiliers is the only battalion that should not have been cut on military grounds. What did for 2RF was the additional criterion that regimental losses be capped at one battalion, thus saving more poorly recruited Scottish battalions ahead of a Scottish referendum. Will the Prime Minister kindly meet me and other MPs from across the House to discuss the issue?

[The Prime Minister]

I am happy to arrange a meeting between my hon. Friend, the Defence Secretary and other interested Members. It is right for the Army to change in its structure—not in its overall size; with 82,000 regular soldiers and 30,000 territorials, the Army’s overall size will not change. It was and is difficult to do that in a way that respects regimental traditions, cap badges and issues that I know are very dear to a number of hon. Members. However, it is important that we do that across the United Kingdom. That is what the Government set out to do, but I am happy to arrange that meeting.

Military Medals Review

Lord Cameron of Chipping Norton Excerpts

Tuesday 17th July 2012 Written Statements

[The Prime Minister (Mr David Cameron)]

I have today placed a copy of Sir John Holmes’ interim review of the rules and principles governing the award of military medals in the Libraries of both Houses. The interim report brings welcome transparency to these arrangements. It finds that the overall approach is reasonably based. However, it also identifies areas where it is worth considering whether the rules could be applied with greater flexibility and transparency. It proposes ways forward to address some past grievances while maintaining the distinctive British tradition that military medals are hard earned. I hope this will help to draw a line under past campaigns and provide a more open decision-making process in future. I welcome the report and have asked Sir John to lead a second stage of work to make further recommendations using the principles he has proposed to implement his findings. This work will be completed as soon as possible in the autumn.

Special Advisers

Lord Cameron of Chipping Norton Excerpts

Tuesday 17th July 2012 Written Statements

[The Prime Minister (Mr David Cameron)]

Listed below are the names of the special advisers in post at 17 July 2012, including each special adviser’s pay band, and actual salary where this is £58,200 or higher, together with details of the special advisers’ pay ranges for 2012-13.

The paybill for the period 2011-12 was £6.2 million¹. This compares to £6.8 million for the period 2009-10 (excluding severance payments made at the general election to special advisers in the last Administration).

Reports on Chief Surveillance, Interception of Communications, and Intelligence Services Commissioners

Lord Cameron of Chipping Norton Excerpts

Friday 13th July 2012 Written Statements

[The Prime Minister (Mr David Cameron)]

I have today laid before both Houses the annual reports of the Interception of Communications Commissioner, the Rt. Hon. Sir Paul Kennedy (HC 496); “the Intelligence Services Commissioner, the Rt. Hon. Sir Mark Waller (HC 497); and, the Chief Surveillance Commissioner, the Rt. Hon. Sir Christopher Rose (HC 498).

The responsibility of the Commissioners is to provide independent oversight of the use of the investigative powers contained in the Regulation of Investigatory Powers Act 2000, Regulation of Investigatory Powers (Scotland) Act 2000, the Intelligence Services Act 1994, and the Police Act 1997.

The Commissioners play a vital role in ensuring that public authorities make use of these powers in a way which is necessary, for a legitimate aim and which is proportionate to what is sought to be achieved. They are required under the provisions of the legislation to provide an annual report to the Prime Minister in respect of carrying-out their functions.

All Commissioners have concluded that these powers are on the whole being used properly and appropriately, in accordance with the requirements set out in statute.

They have also concluded that respective Secretaries of State and the various members of the intelligence services, police and law enforcement authorities and other public authorities are properly complying with their duties as set out in the legislation. The Commissioners provide a vital service in giving Ministers, Parliament and the public assurance in this area.

There have, regrettably, been breaches and errors in the use of these powers. While these have been few in number relative to the overall number of applications, the Government are not complacent; the causes of these breaches and errors will need to be addressed. The Commissioners also highlight the value of the use of these powers and provide a number of case studies to show the benefits they provide, particularly in terms of preventing and detecting serious crime and tackling threats to our national security.

I am grateful to Sir Paul, Sir Mark and Sir Christopher, and to the inspectors and staff which support them, for their work on these reports. The Government are further strengthening oversight of the agencies through the introduction of the Justice and Security Bill which, among other provisions, will give a statutory basis for the Intelligence Services Commissioner to be directed to review any function of the agencies.

Intelligence and Security Committee (Annual Report)

Lord Cameron of Chipping Norton Excerpts

Thursday 12th July 2012 Written Statements

[The Prime Minister (Mr David Cameron)]

I am grateful to the Intelligence and Security Committee for its valuable work and its latest annual report (Cm. 8403). Following consultation with the Committee over matters that could not be published without prejudicing the work of the intelligence and security agencies, I have today laid the report before the House.

The Government’s response to this report will be laid before the House after the summer recess.

Copies of the report have been placed in the Libraries of both Houses.

EU Council

Lord Cameron of Chipping Norton Excerpts

Monday 2nd July 2012 Commons Chamber

[The Prime Minister (Mr David Cameron)]

I am sure that, like me, the whole House will be deeply saddened by the deaths of three British servicemen in Afghanistan yesterday. These brave soldiers were demonstrating great courage to prevent Afghanistan from once again becoming a haven for international terrorists and therefore to help keep us safe here in the UK. The suspected perpetrator is in custody, and we will do everything in our power, with the Afghan national security forces, to ensure that justice is done. This tragic incident again demonstrates the very real risks that our soldiers face every day, and we will learn all the lessons that arise from it. I know that everyone in the House will want to send their support to our brave troops and their families at this difficult time.

Britain had three objectives at last week’s European Council: first, for eurozone members to take the urgent action needed to deal with the immediate crisis; secondly, to secure a comprehensive growth package firmly focused on Britain’s priorities; and thirdly to send a clear message to the rest of Europe about what we expect from the budget negotiations to come. I shall deal with each before turning to future policy and the Government’s response to the banking scandal.

First, on the eurozone, Britain has been clear that in the short term we want urgent action by eurozone countries and authorities to defend their currency and deal with the instability. In the longer term, we recognise that the remorseless logic of a single currency means that the eurozone may need closer economic and fiscal integration. Britain is not in the euro, and we are not going to join the euro, so we should neither pay for short-term measures nor take part in longer-term integration. The summit made some progress. On shorter-term measures, eurozone members agreed to use the bail-out funds to support intervention in bond markets; to put eurozone money directly into struggling banks; and to ensure that official loans to Spanish banks would not be given preferential treatment over private sector loans. Under the last Government, we could have been liable for financial support for these measures, as members of the EU bail-out fund, but this Government have repatriated that power so that the British taxpayer is not involved.

On longer-term issues, eurozone members agreed important steps towards closer integration following a discussion of a report by the President of the European Council and others. It is vital for Britain—and, we would argue, for the strength and prosperity of the whole European Union—that they do this in the right way. We therefore secured agreement that as this work goes ahead, the “unity and integrity of the single market” will be fully respected.

On the specific proposal of a banking union, we ensured that Britain will not be part of any common deposit guarantees or under the jurisdiction of any single European financial supervisor. I am very clear that British taxpayers will not be guaranteeing any eurozone banks, and I am equally clear that, while we need proper supervision of our banks, British banks should be supervised by the Bank of England, not by the European Central Bank. The original draft of the growth compact included a whole section on economic and monetary union which implied that a banking union might apply to all 27 countries. A number of countries worked together to ensure that that whole section of the growth compact was removed.

Our second objective involved growth. The growth programme includes commitments to deal with weak lending, including through an increase in funds for the European Investment Bank. Alongside this are clear commitments to complete the single market in areas such as services, energy and digital, in which Britain will be one of the prime beneficiaries. The agreed plan included dates and times by which those steps should be concluded.

We also agreed to go ahead with the European patent court. Businesses have complained for decades that they needed 27 patents to protect their intellectual property. That problem will now be solved. In finalising the agreement, Britain had two objectives: that the new patent should be redrafted so that it did not get snarled up in the processes of the European Court of Justice, and that a significant part of the court, covering pharmaceutical and life science industries, would be based in London. I am pleased to say that we secured both those outcomes. That will mean millions of pounds and hundreds of jobs for Britain.

Our third objective involved the EU budget for the next seven years. We want a budget that is focused on growth, not a focus on growth in the budget. EU members as a whole are €3.5 trillion more in debt now than when the last EU budget was negotiated. We have to face up to that tough reality. I made it clear that without the British rebate, we would have the largest net contribution in the EU as a share of our national income. Without our rebate, our net contribution would be double that of France and almost one and a half times bigger than that of Germany. So the British rebate is not up for renegotiation. It is fully justified.

On foreign policy, the Council welcomed the EU oil embargo against Iran, which came into force yesterday. On Syria, we called for united action by the United Nations Security Council to place more robust and effective pressure on Assad’s regime, including the adoption of comprehensive sanctions.

Europe is changing rapidly and fundamentally, and that presents real challenges for all countries. Those inside the eurozone have to face fundamental choices about whether to limit their national democracy and provide financial support to the weaker members. And like others outside the Eurozone, we in Britain also face big choices. As Europe changes to meet the challenges of the eurozone, so our relationship with Europe will change, too.

There are those who argue for an in/out referendum now. I do not agree with that—[Interruption.] I do not agree with that because I do not believe that leaving the EU would be best for Britain. Nor, however, do I believe that voting to preserve the exact status quo would be right. As I wrote yesterday, I do not believe that the status quo is acceptable, but just as I believe it would be wrong to have an immediate in/out referendum, so it would also be wrong to rule out any type of referendum for the future. The right path for Britain is this. First—[Interruption.]

[Mr Speaker]

Order. Members are a little over-excitable. They must calm themselves, and the Prime Minister’s statement must be heard.

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[The Prime Minister]

First, we must recognise that, in the short term, the priority for Europe is to deal with the instability and chaos. Secondly, over time, we must take the opportunities for Britain to shape its relationship with Europe in ways that advance our national interest in free trade, open markets and co-operation. As I argued yesterday, that should mean less Europe not more Europe, less cost, less bureaucracy, and less meddling in the issues that belong to nation states. Thirdly, all party leaders will have to address the question. It follows from my argument that, far from ruling out a referendum for the future, as a fresh deal in Europe becomes clear, we should consider how best to get the fresh consent of the British people.

Finally, as I have said, as the eurozone moves towards a banking union, we must ensure that Britain takes responsibility for sorting out its own banking sector. On the unfolding banking scandal here in the UK, we need to take action right across the board, including introducing the toughest and most transparent rules on pay and bonuses of any major financial centre in the world, increasing the taxes that banks must pay, ensuring tough civil and criminal penalties for those who break the law and, above all, clearing up the regulatory failure left by the last Labour Government.

The British people want to see two things: they want to see bankers who acted improperly punished; and they want to know we will learn the broader lessons of what happened in this particular scandal. On the first, the Serious Fraud Office is looking at whether any criminal prosecutions can be brought, and at whether the full force of the law is being used in dealing with this. On the second, I want us to establish a full parliamentary committee of inquiry involving both Houses, chaired by the Chairman of the House of Commons Treasury Select Committee. This committee will be able to take evidence under oath; it will have full access to papers, officials and Ministers, including Ministers and special advisers from the last Government; and it will be given by the Government all the resources it needs to do its job properly.

The Chancellor will be making a full statement, but this is the right approach, because it will be able to start immediately, it will be accountable to this House and it will get to the truth quickly, so we can make sure this never happens again. I commend this statement to the House.

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[Edward Miliband]

Then the Foreign Secretary was sent out to say on television:

“The Prime Minister… is not changing our position.”

Three days, three positions. First it was no, then it was yes, and then it was maybe.

Can Members on both sides of the House have some clarity about the Prime Minister’s position? First, has there been a change in the Government’s position, yes or no? Secondly, the Prime Minister talked of a referendum being connected to the renegotiation of powers. To be fair to him, his position on renegotiation is longstanding, not least because he has got nowhere in negotiating it, but is he now saying that he may be in favour of withdrawal from the European Union if he does not get these powers? That would be a new position. It would be helpful—and I am sure that his Back Benchers would like it too—if we could have a “yes” or “no” answer to that question as well.

Thirdly, can the Prime Minister explain this? Last October, he said in the House:

“there is a danger that by raising the prospect of a referendum… we will miss the real opportunity to further our national interest.”—[Official Report, 24 October 2011; Vol. 534, c. 27.]

So why is he doing it now? We all know the answer to that question. It is not to sort out the crisis of growth, it is not to tackle youth unemployment, and it has nothing to do with the national interest. It is all about managing the divisions in the Prime Minister’s own party. But a nudge-nudge, wink-wink European policy is not good for the country, nor will it keep his party quiet.

Five years ago, the Prime Minister said that his party should stop banging on about Europe, but now he is the man getting out the drum. As John Major could have told him, it is not going to work. We have a veto that never was, a referendum that the Prime Minister cannot explain, a party talking to itself, a Prime Minister who is managing his party rather than leading the country, and a Government who are letting Britain down.

[The Prime Minister]

Let me start with the right hon. Gentleman’s questions about the inquiry into the banking scandal. I think that what he said was rather demeaning to Parliament, the House of Commons and the House of Lords. I see no reason why Parliament cannot get to the bottom of this if we take the best and brightest from both Houses and all parties, and there are few better people to do that than my hon. Friend the Member for Chichester (Mr Tyrie), who has considerable expertise. The key point, however, is that this needs to be done speedily. The Vickers Bill—the banking Bill—will be introduced in the House of Commons in January, and I want an inquiry to be completed by then so that we can take the best of that inquiry and put it in the Bill. I think that that is the right thing to do.

[Ed Balls (Morley and Outwood) (Lab/Co-op)]

It is what you tried to do on Leveson.

[The Prime Minister]

The shadow Chancellor is intervening from a sedentary position. No one would like to see him in the dock of a courtroom more than me, but the job here is to get on with it, find the answers, and put them into law.

Let me now deal with the questions that the Leader of the Opposition asked about the European Union. He asked some very specific questions, including one about Russia and Syria. At the weekend, following some very hard negotiation by my right hon. Friend the Foreign Secretary, all parties agreed on transition by mutual consent. We now need to implement the policy, and all the P5 members need to do that.

The right hon. Gentleman talked about taking responsibility on the economy. When is Labour going to take responsibility for the twin crises: the crisis of the deficit and the crisis of failed banking regulation? He asked what we had done to protect the single market. If he looks at the summit conclusions, he will see that it says very specifically that the single market and its integrity must be protected. On whether the eurozone funds are sufficient, frankly, I think he is right to ask that question. We continually say it is very important that the firewall—the bazookas—are big enough.

On the right hon. Gentleman’s description of recent events, I think he probably ought to give up the hokey-cokey and stick to the Rubik’s cube. But let me tell him this: I am not going to take any lectures from a group of people who gave up the rebate and got nothing in return, who gave up our social chapter opt-out and got nothing in return, and who took us into the bail-out funds when we were not even part of the euro. Those are the people who say that the European Union has not got too much power and that they would join the euro if they were in power for long enough. The right hon. Gentleman likes to tell us endlessly about standing up to vested interests, but the fact is that he will never stand up to two big vested interests: the trade unions and Brussels.

[Sir Malcolm Rifkind (Kensington) (Con)]

While there is wide agreement in Britain as to the need for reforms in our relationship with the EU, does the Prime Minister agree that the worst possible moment to try to start negotiating with 26 other countries is when all the member states are, quite rightly, preoccupied with the very future of the eurozone and the potential of its collapse? Does the Prime Minister also agree that as the UK is fully protected by the statutory requirement for a referendum if there are any further proposals for the transfer of powers to Brussels, it must be the right policy to establish a link between any negotiations which we wish to begin, and the new treaty that would be required to have unanimous conset if the eurozone 17 wish to achieve a fiscal and banking union?

[The Prime Minister]

My right hon. and learned Friend has set out the situation very well. It is worth saying, as I said in my statement, that everyone has to recognise that the short-term firefighting is the EU’s urgent and immediate priority, but my point is that we are safeguarded through the referendum lock in respect of further powers being transferred. However, we must think about how Europe is developing, make sure we make the most of the opportunities, and then think about how to seek the consent of the British people.

[Mr Alistair Darling (Edinburgh South West) (Lab)]

Does the Prime Minister agree that the customary celebrations after last week’s euro summit were, yet again, premature? There is not nearly enough money in the European stability mechanism, as its £500 billion is not enough to deal with Spain, let alone other countries. Equally, the German Chancellor’s opposition to eurobonds means there must be a question mark hanging over the eurozone. On banking, if we are to have a truth and reconciliation committee—which is fine—we must just remember that some of the most strident calls for deregulation over the last 30 years came from the Government side of the House.

[The Prime Minister]

I have great respect for the right hon. Gentleman, and what he says about the eurozone agreements at the weekend is absolutely worth listening to and having regard to. The point I would make is that for the first time in a long time there was a series of steps that countries such as Britain had been calling for about using the facilities to buy bonds and about direct recapitalisation of banks. They are hedged around with all sorts of ifs and buts, but that was progress. On the truth and reconciliation commission issue, I note that the right hon. Gentleman said that a full independent public inquiry is not the right way ahead. I think the way ahead we have suggested will be swift enough, but also strong enough to get to the answers—and to get to them quickly.

[Mr John Redwood (Wokingham) (Con)]

Given that there is practically no unpledged money left in the current bail-out fund and given that the new bail-out fund does not exist, did the member states assembled discuss how they are going to get hold of the £500 billion or more that they might need, and are they proposing to borrow it on the credit rating of countries such as Spain and Italy?

[The Prime Minister]

As ever, my right hon. Friend is incisive at getting to some of the difficulties in what is being proposed. I think we should be pushing the eurozone members into taking the short-term steps to try to help with financial stability, which buying bonds, directly recapitalising banks and sorting out issues of seniority are all about. We have to recognise the great difficulties they are going through in trying to raise adequate amounts of finance, but none the less it is in our short-term interests that they do deal with the crisis at the heart of the eurozone, because the high interest rates in Italy and Spain are not only hurting Italy and Spain; they are hurting us, too.

[Mr Jack Straw (Blackburn) (Lab)]

The right hon. Gentleman failed to answer the question from my right hon. Friend the Member for Edinburgh South West (Mr Darling), the former Chancellor of the Exchequer, just a moment ago, in which he asked the Prime Minister to recognise that the pressure for deregulation and a very light touch in the City was coming very strongly from him and—[Interruption.] Oh yes it was. So if there is to be truth and reconciliation, will there be some acceptance by the Prime Minister and the Chancellor that they got it woefully wrong in putting the pressure on us?

[The Prime Minister]

Everyone will have to account for what they have said and all the rest of it, but I have to ask: who was in charge for the last 13 years? Who was the City Minister who carried out this action? If the right hon. Member for Blackburn (Mr Straw) wants to go into the interstices of who said what and did what, I can tell him that the Conservative party—I do not think I was in Parliament at the time—actually voted against the tripartite arrangement that has so badly failed.

[Sir Menzies Campbell (North East Fife) (LD)]

May I welcome my right hon. Friend’s continuing, and occasionally warm, endorsements of Britain’s continued presence in Europe? Does he also agree that those who wish to take Britain out of Europe now have a duty to provide detail as to what the political and economic cost would be, rather than vague promises of the Elysian fields?

[The Prime Minister]

My right hon. and learned Friend makes an important point, which is that we need to make sure that the whole debate about our engagement in Europe is properly informed. I do support our membership; I do think that the single market is vital for us and that determining the rules of that market matters for us. However, it is important that we air these facts and figures, and the balance of competences review that will be launched shortly will help all parties, all politicians and all parts of civic society in Britain to see some of the arguments and some of the facts and the figures. I think that that will help to inform the debate.

[David Miliband (South Shields) (Lab)]

Further to that question, I wonder whether there are any circumstances, further to the Prime Minister’s negotiations, in which he will recommend to the British people that they should leave the European Union.

[The Prime Minister]

As I said, I want to stay in the European Union for the reasons I have given. But I will always stand up for the British national interest as I see it. That is the job of being Prime Minister.

[Mr Peter Lilley (Hitchin and Harpenden) (Con)]

My right hon. Friend will know that my opposition to excessive centralisation of power in Europe has never been in doubt. Indeed, the only doubt that my Euroscepticism has given rise to was that which John Major cast upon my paternity. Will the Prime Minister, none the less, agree that what we need is not a commitment to an in/out referendum, but a commitment to insisting that our partners give us back powers to govern ourselves if they want our agreement for them to subordinate themselves further to centralisation in Europe?

--- Later in debate ---

[The Prime Minister]

My right hon. Friend, whose parentage I have never questioned, nor would I ever do so, puts it very well. The fact is that Europe is changing very rapidly. The eurozone countries, in my view, are going to need to take some pretty bold integrationist steps. That will provide opportunities and openings for countries outside the eurozone, such as Britain, and we should maximise those opportunities to pursue our national interest. I firmly believe that that means remaining at the table for those things that really matter for us, but I think that is what we should do.

[Mr Peter Hain (Neath) (Lab)]

Is the Prime Minister concerned that on Europe and the referendum he sounds more like John Major by the day?

[The Prime Minister]

What matters is doing the right thing. I think that there are two positions that do not make sense. First, unless you actually want to leave the European Union now, and some people do, an in/out referendum now is not the right answer. But ruling out, for ever and a day, any form of getting the consent of the British people for what I would call a fresh deal and a fresh settlement in Europe also does not make sense. This is a question that all party leaders are going to have to answer. We are providing the answer—the right hon. Gentleman’s party leadership will have to do the same thing.

[Andrea Leadsom (South Northamptonshire) (Con)]

Will my right hon. Friend agree to consider carefully that the Fresh Start project’s options for change paper, which is being launched next week by my right hon. Friend the Foreign Secretary and is the culmination of a year’s work by parliamentarians from all parties and external experts, might possibly offer some of the solutions to the type of reform we are looking for in the EU? Will he also agree to reconsider the issues of competition in the banking sector that, in my opinion, are one of the major reasons why we are in this appalling situation?

[The Prime Minister]

I shall certainly consider very carefully what my hon. Friend says. As I said, the Foreign Secretary will shortly set out the balance of competences review and how the process will work. I hope that that will inform debate; clearly, the piece of work undertaken by her and her colleagues will help. She mentions the banking sector and there are clearly rules for financial services at the level of the single market that are required and it is very important that we have a say over them. The fundamental elements of banking union, however, flow from the single currency, not the single market. That is why that union should be carried out at 17, not at 27.

[Mr Elfyn Llwyd (Dwyfor Meirionnydd) (PC)]

What discussions were there of the likely effects of the oil embargo on Iran and were there any discussions on the knock-on effect on prospects for a sustainable peace in the middle east?

[The Prime Minister]

There were brief discussions about Iran because the discussions about the single currency, the eurozone and the growth compact were so protracted. There is strong agreement in the European Union that the sanctions are right and necessary and I think that if we could get Iran to take a more sensible path on the issue of civil nuclear power, that would help unlock the problems of middle east peace rather than making them worse.

[Mr William Cash (Stone) (Con)]

I was heartened by my right hon. Friend’s interview on the referendum question, but given his negative answer to me on 23 May on that same question, will he take the advice of the London taxi driver to whom I have just spoken, who just said, “The British people are not stupid; they understand the position. Give them renegotiation, give them a referendum, get rid of the coalition agreement—then, he will be re-elected by a massive majority.”

[The Prime Minister]

I can see that it must have been a particularly satisfying and heart-warming taxi ride for my hon. Friend. As I have said, I do not think that an immediate in/out referendum is the answer, but ruling out a referendum is not the answer either. There are opportunities to build the sort of settlement we want in Europe and the Government believe that we should take advantage of them.

[Helen Goodman (Bishop Auckland) (Lab)]

Will the Prime Minister tell the House what indications he has had from European colleagues that they would be likely to agree the repatriation to this country of the social chapter and other powers?

[The Prime Minister]

We were able to renegotiate the bail-out power and get out of that part of the treaty, so we have had some small success on that agenda already. There is a big change coming in Europe. I cannot say how fast it is going to go and whether it will be a number of small treaties or a bigger treaty, but there will be opportunities. The eurozone countries will have to do more to integrate, which will give others opportunities to pursue their own agendas.

[Conor Burns (Bournemouth West) (Con)]

My right hon. Friend the Prime Minister will be aware that the British public are heartily sick of broken promises on European referendums, not least because of the decision of the Labour party to renege on a referendum on the Lisbon treaty. Can my right hon. Friend see the attraction of passing into law in this Parliament a binding commitment to a referendum in the following Parliament and that it might well strengthen his negotiating hand if he can look his fellow Heads of Government in the eye and know that any deal that he negotiates will have to be put to the British people, whose government, after all, we are talking about?

[The Prime Minister]

I take seriously my hon. Friend’s point and there is some merit in that argument. We have legislated in this Parliament for a referendum lock that we very much hope will apply to future Parliaments. The problem with the approach he suggests is that the change in the eurozone and in Europe is happening so rapidly that it is quite difficult to predict in legislation passed in this Parliament the exact nature of any referendum in a future Parliament, so I do not think that is the right way ahead. As I wrote in the article in The Sunday Telegraph, I think we need to show some tactical and strategic patience, knowing that we can safeguard our existing position with the referendum lock and make the most of the changes that are happening in Europe, as I have set out.

[Mr Denis MacShane (Rotherham) (Lab)]

Will the future referendum that the Prime Minister is now semi-pledging also cover treaty obligations relating to the European convention on human rights and the Council of Europe?

[The Prime Minister]

As the right hon. Gentleman knows, the two issues are separate, in that there is the Council of Europe, and the European Union. There is, of course, the attempt to make the European Union a signatory to the European convention on human rights, which I have considerable difficulties with, but as things stand, the two things are separate.

[Sir Tony Baldry (Banbury) (Con)]

Britain is a trading nation. Does my right hon. Friend agree that, as a trading nation, it needs unfettered access to Europe’s single market, and also a clear voice and say in the rules of that market?

[The Prime Minister]

My hon. Friend is absolutely right. That is at the heart of the case for remaining in the European Union. We export a large share of our gross domestic product; we need Europe’s markets to be open. I would not want to swap the status that we have, of having both access to the single market and a say over the rules of the single market, for the status of a country that only has access. It is very important, though, that as the eurozone develops and integrates, we make sure that there are safeguards to prevent caucusing at the eurozone level that could disadvantage us in the single market. There is a whole series of steps that we have to take, some of which are about safeguarding what we have, some of which are about making the most of the future, and all of which are achievable if we play our cards right in the years ahead.

[Kate Hoey (Vauxhall) (Lab)]

May I simply ask the Prime Minister to look at his terminology? In his statement, he mentioned Britain 12 times; he did not mention the United Kingdom once. Does he agree that if there is to be a referendum, which I think is inevitable, the people of Northern Ireland should have a very strong say? He must, in the European Council, refer to the United Kingdom, or the UK for short; saying “Britain” excludes Northern Ireland.

[The Prime Minister]

As ever, the hon. Lady is right about almost everything, and I am rightly chastised.

[Mr Edward Leigh (Gainsborough) (Con)]

What I suspect the majority of British people want is what they were offered in the only referendum that they have ever been allowed on Europe, namely a say on whether there should be a common market—no more, no less. Given that our partners have the overwhelming balance of trade in their favour, why should they veto our negotiation for a free market area? The door is unlocked; why does the Prime Minister not walk through it and renegotiate?

--- Later in debate ---

[The Prime Minister]

The point that I make to my hon. Friend, whom I respect hugely for his views, is that what we have in the single market is not just a free trade area, but a say in the rules about how that free trade area works. It does seem to me that absolutely central to Britain’s case for remaining in the European Union are those two key points. I think that there is a difference between a single market with rules and simply a free trade agreement. That is what I think we should continue to pursue.

[Keith Vaz (Leicester East) (Lab)]

May I welcome the continued support that has been given to Greece? It is not just a case of Greece repaying its debts; it is about the responsibilities that it has to the rest of the EU. Last year, as the Prime Minister knows, 100,000 people illegally entered Greece through Turkey. Will we ensure that those resources are directed towards protecting the borders of the EU?

[The Prime Minister]

I know that the right hon. Gentleman has great expertise in this area. It seems to me important that we support organisations such as Frontex, and the means by which those countries can protect their borders, but in all these European negotiations we always have to be careful about the language of burden sharing, because of course when we look at where people actually end up, in terms of asylum claims, it is often countries such as Britain, Sweden, and Denmark that bear a very large share of the burden, and we always have to be alert to that argument.

[Philip Davies (Shipley) (Con)]

Will the Prime Minister remind his coalition partners that in their 2010 manifesto, they said:

“The European Union has evolved significantly since the last public vote on membership over thirty years ago. Liberal Democrats therefore remain committed to an in/out referendum”?

Given that, and given that I know my right hon. Friend always likes me to remind him that he is in coalition with the Conservatives as well, may I remind him that an in/out referendum is now inevitable in this country at some stage, and that it would be to his advantage to be ahead of that curve, rather than being seen to be dragged into it later on?

[The Prime Minister]

My hon. Friend makes a good point. He often rightly criticises me for not delivering every part of Conservative policy, and now he is having a go at me for not delivering Liberal Democrat policy as well. I do occasionally make that point to our coalition partners, but as I have said, I think the sensible position to take is not having an immediate in/out referendum, but not ruling out a referendum in the future. Europe is changing; there are opportunities for Britain, and I am determined that we should take them.

[Mr Dennis Skinner (Bolsover) (Lab)]

With all these mixed messages, unlike the Thatcher regime, can the Prime Minister tell us whether he came to his present opinion before or after he met Andy Coulson?

[The Prime Minister]

Just to clear it up, I did not meet or speak with Andy Coulson at the weekend.

[Mrs Anne Main (St Albans) (Con)]

I completely disagree with my right hon. and learned Friend the Member for Kensington (Sir Malcolm Rifkind). With the chaos in Europe, there has never been a better time for other EU members to mind their business, not ours, and now is the right time to try to have a debate with them about which powers we would like to bring back, before we have any form of referendum.

[The Prime Minister]

My hon. Friend makes a powerful point. The argument that I would make is that although there may well be opportunities because of the needs that other EU members currently have, respecting the fact that they are fighting a fire in the eurozone, which is their urgent work that benefits us if they can deal with those bond spreads, deal with those banks, deal with those problems, the right time to consider institutional changes is as institutional reforms and treaties come through.

[Sir Stuart Bell (Middlesbrough) (Lab)]

The Prime Minister has referred several times to the national interest. He also referred to the brief discussion on the ban on oil imports from Iran. Is not that ban an example of how the European Union acting in concert can assist the British national interest?

[The Prime Minister]

Yes, I think that it is, but the argument that I would make is that that was an agreement reached through unanimity. It shows that what is required often in Europe is not institutional structures, but political will to come together and do the right thing. That is what we have done in relation to Syria, Iran and eventually Libya, so I am all for co-operating and often leading the debate with our European partners about foreign policy priorities. That is what we have done about Burma and sanctions, but I do not think that means the endless passage of powers from Britain to Brussels—in fact, quite the opposite.

[Simon Hughes (Bermondsey and Old Southwark) (LD)]

May I associate the Prime Minister’s Liberal Democrat colleagues with his expressions of condolence and sympathy following the deaths of our servicemen in Afghanistan? Does the Prime Minister agree that, while it is of course right that at the last election his party had a set of manifesto commitments on Europe, as did the Liberal Democrats, the coalition agreement is clear? There is provision for a referendum if there is a handover of power from the UK to Brussels. There is no provision for any other referendum, and we are agreed that the priority, as evidenced last weekend, is that 27 European countries work together to deal with the imminent, urgent economic crisis across Europe.

[The Prime Minister]

My right hon. Friend makes an important point. To be fair, in terms of coalition policy on Europe, we said clearly that there would be no further passage of power from Britain to Brussels. We have said that we should protect and defend the single market. Let us look at the achievements over the past couple of years. We have got out of that bail-out fund; we have promoted the single market in energy, digital and services; and we have written into conclusions after conclusions safeguards for the single market. That is all to the good, but all party leaders, whether Conservative, Liberal Democrat or Labour, must think of the future— how we evolve policy in a changing Europe, how we maximise the benefit for Britain, and how we take the British people with us. That is exactly what I am doing.

[Ms Gisela Stuart (Birmingham, Edgbaston) (Lab)]

The Prime Minister suggests the setting up of a parliamentary committee of inquiry. Whenever we have such inquiries and when they are compared with judge-led inquiries, the big difference is access to information, such as e-mail exchanges and other background material. Will he ensure that in its terms of reference such a committee will have the same powers as a judge-led inquiry?

[The Prime Minister]

The short answer to that is yes, I want it to have those powers. What Parliament has behind it is that, if people do not produce those policies, papers and people, they are in contempt of Parliament. We are seeing with the Culture, Media and Sport Committee inquiry that the whole concept of being in contempt of Parliament is being strengthened, and that is all to the good. The committee will have the powers that it needs and the expertise that it needs, but crucially it will be able to get on with the job straight away.

[David T. C. Davies (Monmouth) (Con)]

Does the Prime Minister agree that the last time we saw the current levels of interference in British domestic affairs, it led to the traumatic split with the Catholic Church? Does he agree that we would be better off having a second referendum than a second Reformation?

[The Prime Minister]

The point I would make—[Interruption.]

[Mr Speaker]

Order. I want to hear the Prime Minister on the subject of reformations and other matters.

[The Prime Minister]

As a rather wishy-washy member of the Church of England, I am finding answering this question rather difficult. The point I would make is that there are opportunities, but we should show patience because our colleagues in Europe are dealing with a fire-storm. We can pursue our interests and, I think, deliver on them over the medium term.

[Barry Gardiner (Brent North) (Lab)]

The EU decision on the oil embargo on Iran has caused great joy in the paint shops around the Arabian Gulf, as vessels have gone into dry dock to be repainted, renamed and reflagged. Can the Prime Minister set out for the House what practical steps are being taken to monitor Iranian vessels to ensure that there is an embargo in fact as well as in name?

[The Prime Minister]

The hon. Gentleman raises an important point. I believe that the embargo will be robust and we will make sure that it is policed. I do not want to set out in public what all those measures will be, but we will make sure that the points he makes are taken on board.

[Mark Pritchard (The Wrekin) (Con)]

Far be it from me to correct the right hon. Member for Bermondsey and Old Southwark (Simon Hughes), but I understand that the Liberal Democrat manifesto referred to provision for a referendum if there is

“fundamental change in the relationship between the UK and the EU.”

The Prime Minister said in his statement that “Europe is changing rapidly and fundamentally.” Is it not time we had an in-or-out referendum in this Parliament, rather than relying on the outcome of the next general election, which of course nobody can predict?

[The Prime Minister]

I completely understand the view held by my hon. Friend and a number of other colleagues on our Back Benches either that we should want to get out straight away and so should have an in/out referendum straight away or, to be fair to him, that the change has been so fundamental that the referendum should be held sooner rather than later. I have set out my argument; I think it would be better not to do that immediately for the reasons I have given. I think that there is an opportunity for what I would call a fresh settlement and fresh consent that would be in the national interest of the whole United Kingdom.

[Pete Wishart (Perth and North Perthshire) (SNP)]

Well, it looks like we are going to have a referendum, maybe in two or three years’ time, and maybe there will be more than one question—a Euro-max option—and we do not know what the question will be, yet the Prime Minister has the gall and temerity to question the Scottish National Party’s referendum process. Does he believe that all this delay for two or three years will create a great deal of business uncertainty across the United Kingdom?

[The Prime Minister]

I have to say gently to the hon. Gentleman that there is a slight difference. As I understand it, his party has a very clear view that it wants to leave the United Kingdom, and fought an election in Scotland on having a referendum to do just that. What I am trying to do is help him to have that simple, single-question referendum so that the country can make a decision. I profoundly hope that Scotland will vote to stay in the United Kingdom, which I think would be in Scotland’s interests and in all our interests, but I have to say that we should not have to wait quite as long to get on with it as his First Minister wants.

[Mr John Baron (Basildon and Billericay) (Con)]

The Prime Minister has repeatedly said that now is not the time for an in/out referendum, so will he confirm that the letter I and 100 other colleagues sent to him urged him to legislate in this Parliament for a referendum in the next Parliament and so address the mass public distrust in politicians promising referendums on Europe, because they remember all too well the Labour party’s broken promises?

[The Prime Minister]

I absolutely hear what my hon. Friend says. I do not want to misrepresent him, and if I have done so in any way I absolutely apologise. That was never my intention. I read very carefully the letter he sent to me. He is not suggesting an immediate in/out referendum. As I said in reply to my hon. Friend the Member for Bournemouth West (Conor Burns), although it is possible to legislate in one Parliament to bind the next, as we have done with the referendum lock, I do not think that it makes as much sense to do that with a referendum for the future, because we do not know the exact pace of developments in the eurozone or the exact changes that will take place in Europe; I do not think that that is the right answer.

[Chris Bryant (Rhondda) (Lab)]

The coalition agreement makes another commitment in relation to treaty change: that the Government will campaign to abolish the ludicrous caravanserai between Brussels and Strasbourg, which we would all agree should be abolished. I am absolutely certain that the Prime Minister has got absolutely nowhere with that and possibly has not yet even mentioned it to the new French President, so why should people trust him when he promises more renegotiation and has not even managed to secure the one thing he is committed to?

[The Prime Minister]

I am still waiting for my apology, which I notice I have not yet got. Perhaps there will be a few more questions first. The hon. Gentleman will know that in order to deal with the problem of the two Parliaments we need a treaty change, so he should want to bring it on.

[Nicholas Soames (Mid Sussex) (Con)]

May I associate myself with the remarks of my hon. Friend the Member for Banbury (Sir Tony Baldry) about the importance of trade and the single market? Does the Prime Minister agree that if we are to see a return to prosperity in the European Union, the rules of the World Trade Organisation need to be vigorously enforced? To that end, it would be fatal were we not to be sitting at the table when those matters are discussed.

[The Prime Minister]

My right hon. Friend makes an important point. One of the things that we have made progress on over the past two years is the EU free trade deals with fast-growing parts of the world, including Korea, and obviously negotiations are under way with Singapore, India and others, including possibly Japan. In recent weeks, we have also made some quite exciting progress with the idea of an EU-US trade deal, so there are things that European nations can do together for our mutual benefit. Trade and the single market are clearly absolutely up there, and I very much agree with my right hon. Friend on that point.

[Mr David Winnick (Walsall North) (Lab)]

After what has happened today and the responses from the Prime Minister’s side of the House, does he now have some sympathy for what John Major had to endure from his party during the 1992 to 1997 Parliament?

[The Prime Minister]

I worked very closely with John Major and admire him very much. People now make a reassessment and see that he left this country an excellent economic record, which the Labour party completely squandered with a whole decade of debt.

[Mr Stewart Jackson (Peterborough) (Con)]

Irrespective of our personal views, why is it right that the people of Scotland will be given a potentially irreversible in/out referendum by 2014, yet the people of the United Kingdom will not be given a similar plebiscite on a matter of great import—this country’s relationship with the European Union?

[The Prime Minister]

I have great respect for my hon. Friend, who takes a very clear view about which he feels very deeply. I think that there is a significant difference, which is that in Scotland, like it or not, the Scottish National party is committed to leaving the United Kingdom and was elected with a mandate for a referendum to do just that, whereas in the case of the United Kingdom and the European Union, most people in our country want a fresh settlement with fresh consent, rather than the binary choice of leaving right now or, indeed as I said in my statement, voting to stay in right now and thereby almost confirming that status quo, which I am not satisfied with—and I do not think many people are.

[Paul Flynn (Newport West) (Lab)]

How many of the hundreds of new jobs that will come from setting up the patent court will be located in the city that has been the home of the brilliantly successful United Kingdom Patent Office, now the Intellectual Property Office, the city of Newport?

[The Prime Minister]

I do not know the answer to that question; I will have to look very carefully and, perhaps, reply to the hon. Gentleman. The parts of the court that we will have will be pharmaceuticals and life sciences, an area of great national expertise, and it is a good deal for London and a good deal for the UK.

[Joseph Johnson (Orpington) (Con)]

Unemployment in the eurozone today hit a fresh record high of 11.1%, with youth unemployment reaching the terrible level of 22.6%. Whatever happens to the euro, what recognition is there in Brussels of the risk of creating a lost generation unless the EU as a whole takes seriously the need to do serious labour market deregulation and to push ahead with the completion of the single market?

[The Prime Minister]

My hon. Friend makes a very important point. If we look at the different rates of youth unemployment throughout Europe, we find that we are certainly not one of the best, but certainly not one of the worst. We can look at countries such as Germany and Holland, which have very low rates of youth unemployment, different approaches to welfare from ours and different approaches to training, and we have a lot to learn from them, but overall what my hon. Friend says about opening up the single market—deregulating—is one of the key answers to getting young people back to work.

[Mr Nicholas Brown (Newcastle upon Tyne East) (Lab)]

Can the Prime Minister explain to the House why existing anti-fraud legislation does not work in the case of the LIBOR rate-setting scandal?

[The Prime Minister]

As I have said, today we have asked the Serious Fraud Office to look specifically at the issue and to see whether there are criminal acts that it can address. It has the resources that it needs, and if it needs more resources it will be provided with them, but we have a Serious Fraud Office, which is the authority for both investigation and prosecution, to deal with just that question.

[Richard Harrington (Watford) (Con)]

I am sure that the Prime Minister remembers from his recent visit to Watford the several multinational companies, such as Medtronic and Hilton Worldwide, whose trade depends very much on their using the UK as a hub for their European operations. With that in mind, could he assure the thousands of my constituents who work for those companies that nothing that happened in the European Council will be detrimental to their interests—and, above all, that he will not be bounced into an in/out referendum that could put their jobs at terrible risk?

[The Prime Minister]

My hon. Friend is absolutely right. Britain benefits from being in the single market and having a say over the single market rules. One of the things that has happened over the last two years has been that, because of investments by companies such as Nissan, Honda and Jaguar Land Rover, we in the United Kingdom are now a net exporter of cars again, for the first time since 1976. Access to the single market and our role in the single market play a key part in that investment.

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

Businesses in my constituency are worried about jobs and growth. Given the size of our trade relationships with Europe, they want a Prime Minister who will show leadership in getting growth across Europe. What progress did the Prime Minister make on a growth package and how did he see that as being in the UK’s national interest?

[The Prime Minister]

I am grateful for the hon. Lady’s question. There was good progress on the growth compact. I think people had expected that it was all going to be an agenda, important though that is—project bonds and European Investment Bank spending is part of it. But the hon. Lady will see that in the growth compact, copies of which will be available in the Library, there are very clear commitments to the services directive, energy liberalisation and the digital single market. That is very much the British, and also Italian, agenda, which we have driven into the growth compact, which will really help our country.

[Several hon. Members]

rose—

[Richard Drax (South Dorset) (Con)]

The Prime Minister urges close integration as one solution to the problem in Europe. Closer integration, even among a smaller number of eurozone countries, is already leading to economic chaos and big civil disorder. Surely he should be advising everyone to go back to their currencies, except, perhaps, for the powerful countries in Europe, and then rebuild the economy, rebuild jobs and rebuild wealth.

[The Prime Minister]

We cannot make choices on behalf of other European countries. The eurozone countries say that they want a single currency and that they want that single currency to work. If that is the case, I believe that it follows that they will have to integrate more deeply. It remains to be seen whether all of them will be able to do that. What we see in Europe, week after week, are the difficulties of taking those steps. None the less, we cannot instruct those countries not to do something. That is their choice. We have made our choice, which is to stay out of the eurozone. As I said, we are not going to be involved in that integration and we will not be paying those bills. I hope that my hon. Friend can be reassured on that basis.

[John Cryer (Leyton and Wanstead) (Lab)]

Can the Prime Minister confirm that he is prepared to see the sacrifice of sovereignty and democracy in Greece and other eurozone countries to defend the single currency?

[The Prime Minister]

I would not put it like that. I cannot tell the Greek people what to do. My view is that the right answer for Britain is to be outside the single currency and not to be involved in this integration. People can go back to my election address in 1997, when I said that I opposed Britain’s joining the single currency. The reason why I opposed it was that I did not think it right to give up that sovereignty and level of democracy. That is a choice that those countries and those people must make; it is not for us to make it for them.

[George Eustice (Camborne and Redruth) (Con)]

I agree with the Prime Minister that the priority for this country should be to negotiate the return of powers from the EU and that any referendum should come at the end of that process, not the beginning. However, does he agree that we should reject the defeatism of the Leader of the Opposition and start to articulate the case for an alternative vision for the future of Europe?

[The Prime Minister]

My hon. Friend makes a very important point. There has been a defeatism from the Labour party, including when it was in government. When confronted with difficult choices about the rebate, it gave it up; and when confronted with the issue of the European constitution, it promised a referendum and did not deliver it. In the end, it always went along with absolutely everything. The Labour party has not yet told us whether it would sign the treaty that I refused to sign back in December. When it comes to this, it is the status quo party.

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

There are significant misgivings about the impact of a banking union on the financial services sector in this country; the Prime Minister commented on some of them earlier, during his statement. What reassurance can he give the House that the strategy that he is currently following will not lead to the long-term disadvantage of finance in this country?

[The Prime Minister]

I do not believe that it will. We are trying to protect our interests in terms of the single market and our strong financial services industry. I believe that a banking union flows from the fact that there is a single currency rather than from the fact that there is a single market. That union should be at 17, and we will be able to protect our interests from outside it.

[Steve Baker (Wycombe) (Con)]

I welcome the progress that my right hon. Friend is making towards obtaining the full-hearted consent of the British people. Will he remind us, please, who denied the British people their say on the Lisbon treaty?

--- Later in debate ---

[The Prime Minister]

My hon. Friend makes a good point. The fact is that a promise was made of a referendum on the European constitution, which changed into the Lisbon treaty. The previous Government had every opportunity to deliver that referendum as country after country went through passing that treaty into law, and they completely failed and let the country down.

[Nia Griffith (Llanelli) (Lab)]

Will the Prime Minister give us a little more detail about the evidence that he used to convince his EU counterparts that the UK Government are serious about increasing demand, particularly in the light of the latest disastrous UK growth figures?

[The Prime Minister]

The point I would make to the hon. Lady is that there are parts of the growth compact that include expanding the role of the European Investment Bank, and we support that. We support the idea of project bonds—innovative finance—because part of the problem is the need for an active monetary policy required right across the European Union. However, we should not give up on the real wins for our economy of completing the single market in energy, digital and services, because real increases in both demand and supply could come about from that.

[Neil Carmichael (Stroud) (Con)]

No doubt there will be many more EU Councils to come, so does the Prime Minister think that he would be helped or hindered in his negotiations to protect Britain’s interests if there were an in/out referendum in the foreseeable future?

[The Prime Minister]

I am sure that the first half of my hon. Friend’s question is right. I have been Prime Minister for only two years, but I feel that I have spent about half my life in the Justus Lipsius building in Brussels, and I am sure that other summits will be coming along. The point about having an in/out referendum now is that if your view is that Britain should leave the European Union, then of course that is the logical thing to do, but if you want to fight from the inside for a fresh settlement and then a fresh mandate, the approach that I am setting out is the right one.

[Graham Stringer (Blackley and Broughton) (Lab)]

The Prime Minister has claimed success with the bail-out funds, which, of course, were not part of any treaty. Most of the powers that have been transferred from this House are in treaties. If he fails to renegotiate those powers and return them to this House, will he then agree to an in/out referendum?

[The Prime Minister]

On the bail-outs, I do not think that the hon. Gentleman is correct. The fact is that a treaty article was used for those bail-outs, and we have replaced what was called the EFSM, the European financial stabilisation mechanism, with the ESM, the European stability mechanism. I got it written into the preamble to the treaty that Britain would not be included in it and would not have to contribute to it. That is to our advantage, and it shows what you can achieve if you are prepared to negotiate hard and not just give in to whatever people want.

[Matthew Hancock (West Suffolk) (Con)]

I warmly welcome the announcement of the review into banking to replace the failed regulation drafted by Labour Members, but will the Prime Minister ensure that, as a deterrent, criminal sanctions are available in future for those bankers who are wholly irresponsible?

[The Prime Minister]

My hon. Friend makes an important point. The Chancellor will be going into more detail on this issue. We need to ensure that the regulators and the SFO have all the powers they need. People will not understand why crimes on the high street are punished in one way but crimes in the banks and elsewhere are punished in another way. That absolutely needs to be cleared up, and I am sure that this Government will do so.

[Wayne David (Caerphilly) (Lab)]

Given the Prime Minister’s support—in theory, at least—for a referendum on Europe, what is his position now with regard to a referendum on Lords reform?

[The Prime Minister]

We have set out in the House of Lords Reform Bill a very clear pathway for the House of Lords. House of Lords reform was in the hon. Gentleman’s party’s manifesto, it was in our manifesto, and it was in the Liberal Democrat manifesto, so I do not think a referendum is really necessary.

[Mr Peter Bone (Wellingborough) (Con)]

I can report that the relationship between Mrs Bone and the Prime Minister is blooming. I have just discovered that the Prime Minister has invited Mrs Bone to Downing street next week. She is very excited about the renegotiation and the Prime Minister’s words on the referendum. Could he please her even more at next week’s meeting by promising legislation in this Parliament for an EU referendum in the next Parliament?

[The Prime Minister]

As ever, I am looking forward to my meeting with Mrs Bone, but—how can I put this?—I do not want to get her too excited before the big day. I am afraid that I cannot satisfy my hon. Friend on that basis. We have in place the referendum lock, which I think should reassure Mrs Bone a lot.

[Mark Hendrick (Preston) (Lab/Co-op)]

What game is the Prime Minister playing? He is encouraging eurozone members to integrate closer and at the same time encouraging his Back Benchers by saying that we will have a referendum that could bring us out of the European Union.

[The Prime Minister]

I do not really understand what lies behind the hon. Gentleman’s question. It is intellectually coherent to argue that if countries want to be in the eurozone and to have a working single currency, they must take at least some of the steps that other single currencies, such as the dollar and the pound sterling, have taken. That means that they have to stand behind weaker parts of the union and that they need things such as joint debt issuance and a single banking system. That is just a fact of economic life. I see no contradiction in arguing that Britain should be outside the eurozone with a looser relationship with the European Union and that those inside the eurozone will have to take at least some of the steps that I have set out. If they do not, I think that the eurozone will have real difficulties.

[Mr James Clappison (Hertsmere) (Con)]

Does not the history of our membership of the European Union demonstrate that there is not just an issue with the single market, but that there is more of an issue with the ever closer union that is enshrined in EU treaties? Will my right hon. Friend assure us that to be meaningful, a referendum must encompass the question of ever closer union?

[The Prime Minister]

That goes back to one of the problems with the referendum in the 1970s, when people did not receive a full explanation of all that was envisaged by the original treaty of Rome. I am clear that I do not support ever closer union. I do not want to see an ever greater transfer of powers from nation states to Brussels. However, I think that Britain and the European Union can work very well together to maximise the single market and our co-operation on matters such as foreign affairs, while ensuring that it is in our national interest.

[Mr David Anderson (Blaydon) (Lab)]

Was the financial transactions tax spoken about at the weekend, whether formally or informally? Does the Prime Minister not realise that the people of this country would welcome that as a way of showing that bankers are being made accountable for their appalling behaviour?

[The Prime Minister]

The financial transactions tax was mentioned, because the growth compact says clearly that a number of eurozone members will go ahead with it. I do not support it and Britain will not take part, because unless there is agreement all over the world, the transactions will go to jurisdictions that do not have the tax. That would cut our jobs, our investment and our GDP. The people who would pay for such a tax would be not the bankers, but the pensioners, and I do not think that that is sensible.

[Nigel Adams (Selby and Ainsty) (Con)]

How bad does the Prime Minister think the financial damage to the UK would have been had we not got ourselves out of the euro bail-out mechanism?

[The Prime Minister]

I am grateful for my hon. Friend’s question. We can start to count the cost, because with things such as the Spanish bank bail-out, we can work out what percentage we would have paid. We have saved Britain considerable amounts of money by ensuring that we are not involved in the bail-outs.

[Mr William Bain (Glasgow North East) (Lab)]

Economic demand is continuing to fall across the eurozone, youth unemployment in Greece and Spain reached 52% today, and 5.5 million young people are unemployed across the EU. When will the Prime Minister finally acknowledge that the answer to such a chronic crisis of demand and jobs can never be harsher austerity?

[The Prime Minister]

The point that I would make to the hon. Gentleman is that because we are outside the euro, as well as having tough fiscal targets, which frankly anyone in my position would have to deliver to deal with the debt and the deficit that we were left, we can have a very accommodating monetary policy, with ultra-low interest rates. Our monetary policy is our own to determine because we are outside the euro. That is the difference between the situation in Britain and the situation in countries that are inside the eurozone.

[Jacob Rees-Mogg (North East Somerset) (Con)]

I completely support the Prime Minister in saying that the answer is less Europe, rather than more Europe. I wonder if I may bring his attention to part (j) of the communiqué, which states that the Commission will work on proposals for a

“common consolidated corporate tax base”.

Can I assume that Her Majesty’s Government will oppose those moves, as we are cutting corporation tax here, not trying to raise it to European levels?

[The Prime Minister]

He can.

[Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op)]

It is clear that the type of referendum that the Prime Minister has in mind is one in which the choice is to vote in favour of whatever settlement we manage to extract or in favour of the status quo. Does he think such a referendum would satisfy the in/out zealots on his Back Benches?

[The Prime Minister]

For people who want to leave the European Union—that is a perfectly honourable, respectable political tradition and Members on both sides of the House, probably even Liberal Democrats, have held that position—campaigning for an in/out referendum is a perfectly sensible thing to do. It is just not my view or the Government’s policy, and I do not think it is the hon. Gentleman’s, either.

[Mr Julian Brazier (Canterbury) (Con)]

I welcome the Prime Minister’s announcement of the progress in Russia’s views on Syria. Could we do more to persuade Russia that it is not in its interests to have a nuclear-armed Iran sitting on its border?

[The Prime Minister]

My hon. Friend is entirely right to make that point, and the Foreign Secretary has spent a lot of time with his Russian counterpart having exactly those discussions. There are great connections between resolving the situation in Syria and trying to get a resolution to the Iranian situation. It is worth noting that the oil sanctions have come in. They are tough and represent concerted action by the European Union, and I think they can make a difference.

[Huw Irranca-Davies (Ogmore) (Lab)]

The Prime Minister’s position on an EU referendum seems to be summed up in that comedy catchphrase, “Yes but, no but, yes but, no but.” Is he likely to come to a decision and resolve his teenage dilemma before the next election?

[The Prime Minister]

I think I would let Vicky Pollard stick to her own work and think of something different.

As I have said, I think there are only two positions that do not make sense for Britain. One is an immediate in/out referendum, which I do not think would be right for us, and the other is somehow to rule out for ever and a day any way of forming a new consent with the British people. I want to see a new settlement, and I think we should then get a new consent. That seems to me an entirely sensible and logical position to take.

[Mr David Nuttall (Bury North) (Con)]

At a time when EU countries are more indebted than ever before, why should the UK pay more so that the European Investment Bank can make yet more loans when there is an increasing risk that some of those loans will never be repaid? How much of the €10 billion increase in funding for the EIB will this country have to pay?

[The Prime Minister]

We account for about 14% of new loans made by the European Investment Bank. There is clearly weak lending by banks and there are problems in monetary policy right across the European Union, so the role of the EIB is helpful. It is important, though, that it maintains its very strong triple A credit rating.

[Several hon. Members]

rose—

[Clive Efford (Eltham) (Lab)]

With reference to the answer that the Prime Minister gave to the hon. Member for West Suffolk (Matthew Hancock), if he genuinely believes that some of the actions of Barclays bank bordered on the criminal, will he now call for the resignation of Mr Bob Diamond?

[The Prime Minister]

I do not think it is for Prime Ministers to hire and fire bank chiefs. Mr Diamond will have to make himself accountable to his shareholders, and to this House when he answers questions on Wednesday. As I have said, I think he has some serious questions to answer.

[Dr Julian Lewis (New Forest East) (Con)]

Is it my right hon. Friend’s position that in any referendum on Europe while he is Prime Minister, the option of voting to leave the EU will not appear on the ballot paper?

[The Prime Minister]

No, that is not what I have said. What I have said is that I do not support an immediate in/out referendum. I believe that we should show strategic and tactical patience, and then I want to see a fresh settlement for which we seek fresh consent. The right time to determine questions about referendums and the rest of it will be after we have that fresh settlement. That is what we should do.

[Gregg McClymont (Cumbernauld, Kilsyth and Kirkintilloch East) (Lab)]

The Prime Minister has repeatedly endorsed the United Kingdom’s membership of the EU this afternoon. Will he say something about the circumstances in which he would endorse withdrawal from the European Union?

[The Prime Minister]

What I have always said is that we should act in the interests of the whole United Kingdom, and I do not think our best interests would be served by leaving the European Union. That does not mean that we meekly and lamely accept the status quo. We are not happy with the status quo, as the British public are not. I am not a defeatist who says that you have just got to take what you are given. We have already shown in a small way, by getting out of the bail-out fund, that we can do better, and I want Britain to do better.

[Ian Swales (Redcar) (LD)]

Is the Prime Minister aware of any significant City institutions that want this country to leave the EU?

[The Prime Minister]

I am not aware of any City institutions that want that. On the whole, the City institutions want to ensure that our position in the single market is safeguarded. I am not a mercantilist, but it is worth noting that the one sector in which we have a massive current account surplus with Europe is financial services. It is therefore important that we ensure we safeguard the interests of that sector.

[Mr David Evennett (Bexleyheath and Crayford) (Con)]

I welcome my right hon. Friend’s statement. Does he agree that we must continue to battle for radical and substantial reform of the EU and not be deflected from our national interests of trade and the single market?

[The Prime Minister]

My hon. Friend puts it extremely well. We should pursue the national interest. The key argument is membership of and influence over the single market. That lies at the heart of our case for being in the EU.

[Mr Sam Gyimah (East Surrey) (Con)]

Does my right hon. Friend agree that a referendum is only a means to an end and not the end in itself, and that it is therefore important for us to work out what Europe we want to emerge from this crisis and what it means for the UK national interest, so that we give voters a meaningful choice in the matter?

[The Prime Minister]

My hon. Friend is absolutely right. Before we get to the referendum question, we must ask the prior questions of what exactly Britain wants in Europe, what we have at the moment, what we would like to change and how we can best change it. All those prior questions need to be asked before we get to the vital question of how to secure the full-hearted consent of the British people.

[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

More Eurocrats work in education and culture than on the internal market and services. Will my right hon. Friend stand up for hard-pressed British taxpayers and ensure that our scarce resources are directed towards jobs and growth by completing the internal market?

[The Prime Minister]

The depressing statistic my hon. Friend gives is important as we go into the budget negotiations. We must ensure that the EU budget is focused on things that are likely to help with growth, such as the single market, rather than on regulation. She makes a very good point.

[James Morris (Halesowen and Rowley Regis) (Con)]

There has been a lack of growth in Europe, but does the Prime Minister agree that, despite concerns about our future relationship with the EU, we should focus on policies that target growth, particularly in important sectors for British business, such as energy and the digital market?

[The Prime Minister]

My hon. Friend is entirely right. That is why our approach in Europe—the positive steps we have taken—is about building an alliance with other European countries to push forward the single market and free trade agenda. It has been heartening that in recent months, people such as Prime Monti of Italy and Prime Minister Rajoy of Spain have been involved in that. There is no longer a north-south divide in Europe: many countries are pushing for the growth agenda that has been championed by both parties in the coalition.

[Gavin Barwell (Croydon Central) (Con)]

I welcome the Prime Minister’s stress on the importance of the single market and his statement that, in other areas, the EU status quo is not acceptable. Does he agree that this issue will be solved in the long-term only by giving the British people their say?

[The Prime Minister]

My hon. Friend is right that, in the end, as Europe changes and as we seek this fresh settlement, we will need to seek a fresh mandate. That is what the Conservative party at least has clearly recognised.

[Henry Smith (Crawley) (Con)]

At last week’s meeting, the European Council president said it could take up to a decade to implement EU treaty change. Does my right hon. Friend agree that it is therefore more important that the Government passed a referendum lock in legislation?

[The Prime Minister]

My hon. Friend makes a very good point. Europe is changing rapidly and, as I have argued, quite fundamentally, but some of the institutional changes will take quite a long time to come through, because it is difficult for democratic states to achieve what the eurozone countries are engaged in. It will take time, which is why, as I have said, we need the tactical and strategic patience to maximise our national interest.

[Robert Halfon (Harlow) (Con)]

I welcome the fact that my right hon. Friend has opened the door to a referendum on substantial renegotiation. Will he resist EU regulations on biofuels, which are pushing up prices at the pumps for hard-pressed motorists?

[The Prime Minister]

One question about biofuels is their sustainability—that might be what lies behind my hon. Friend’s question, but I will have a careful look at it.

[Charlie Elphicke (Dover) (Con)]

Although I welcome the Prime Minister’s setting up the banking review, does he agree that the real crime is that there is any doubt at all that interest rate rigging is a criminal offence? If we are to have truth and reconciliation, should we not see a bit more responsibility and a bit less of the buck-passing that we have seen from former Labour Cabinet Ministers today?

[The Prime Minister]

My hon. Friend makes an important point, but although there has been silence from the Labour party in this House, in the other place its Whip stood up and said, “Absolutely, this is squarely Labour’s fault.” It is a pity we do not hear a bit of that from the party here.

[Andrew Bridgen (North West Leicestershire) (Con)]

Given that the UK is running a large trade deficit with the rest—[Interruption.]

[Andrew Bridgen]

Given that the UK is running a large trade deficit with the rest of the EU, does my right hon. Friend agree that our European partners would have much to lose from erecting trade barriers with this country, if the British people decided to leave the EU?

[The Prime Minister]

My hon. Friend makes a good point. Britain is not only a huge market for other EU goods but a large net contributor to the EU budget. For that reason, as I often say, our membership entitles us to just as strong a view as those who have joined other parts of the EU, such as the single currency. We should never be frightened of making our voice heard.

[Jason McCartney (Colne Valley) (Con)]

Does the Prime Minister agree that the Leader of the Opposition is wrong to criticise those who bang on about Europe, because by doing so he is criticising my constituents who bang on about the EU directives, whether on fish discards, animal experiments on stray cats and dogs or the levying of VAT on aviation fuel for the Yorkshire air ambulance?

[The Prime Minister]

As ever, my hon. Friend speaks up robustly for his constituents. Some of the issues that we face in our constituencies relate to the extra regulation, extra cost and extra bureaucracy coming from the EU, so he is absolutely right to make that point.

[Mr Speaker]

Last but not least, we must hear the voice of Kettering, Mr Philip Hollobone.

[Mr Philip Hollobone (Kettering) (Con)]

Given that my right hon. Friend is now not ruling out a future referendum on our membership of the EU, is it not time for Her Majesty’s Government to commission an official, full-scale, independent, comprehensive audit of the costs and benefits of our membership in order better to inform that referendum when it comes?

[The Prime Minister]

When my hon. Friend sees the balance of competences review, he will find that a lot of what he seeks is in it. The idea is to look through the competences exercised by the EU and nation states, and to work out the costs and benefits, so that we have a proper and informed debate. Where he and I will differ, I suspect, is here: I think we benefit from having access to, and a say over, these markets, and that is a powerful argument for remaining in the EU. Like him, however, I am not happy with the status quo, and I want us to seek to change it and then get consent for it.

[Mr Speaker]

Order. I thank the Prime Minister, the Leader of the Opposition and the 74 Back Benchers who have questioned the Prime Minister in 62 minutes of exclusively Back-Bench time.

G20 Summit

Lord Cameron of Chipping Norton Excerpts

Monday 25th June 2012 Commons Chamber

[The Prime Minister (Mr David Cameron)]

The G20 needed to address the five big threats to the global economy: first, the problems in the eurozone; secondly, the mountain of debt and persistence of imbalances in the world economy; thirdly, the lack of growth; fourthly, the rise of protectionism; and fifthly the failure to regulate our banks properly. I shall take each briefly in turn.

First, I turn to the eurozone. Britain is not in the eurozone, and we are not going to join it, but, given that 40% of our trade is with the eurozone, its future affects our future. It is in our national interest for it to resolve its difficulties. As a full member of the EU and a significant net contributor to its budget, it is not only vital but right that we speak plainly about what needs to happen.

In the short term, we need rapid action by the core of the eurozone, including the European Central Bank, to restore financial stability and confidence to the countries on the periphery of the eurozone as they undergo their vital structural reforms. That needs to be reinforced in the medium term by improvements to the governance of the eurozone that recognise the remorseless logic of being in a currency union.

This clearly was a G20 summit, not a eurozone summit, but none the less the eurozone countries made some steps towards both those goals. First, they agreed to take all necessary policy measures to safeguard the integrity and stability of the eurozone, including breaking the link between sovereign debt problems and bank instability, and secondly they committed to taking further steps towards fiscal and economic integration, including through a banking union.

Britain does not want to stand in the way of these measures towards closer integration of the eurozone, but we will not be part of them. We did not join the eurozone precisely because we did not want to give up the kind of sovereignty over our national economy that is essential to making a currency union work. And we have been clear that whatever long-term decisions are made about the governance of the eurozone, the rules that govern the single market must always protect the interests of all its 27 members. This is a red line for Britain and is vital to our national interests. The eurozone now needs to get on with implementing the agreements reached at the G20, and I will work at the European Council this week to ensure that the eurozone takes these steps in a way that protects the UK’s interests.

To deal with the wider risks of contagion to the global economy, the G20 also welcomed the commitments to increase the resources available to the IMF by more than $450 billion. It is a basic principle of the IMF that the help it offers is for countries not for currencies. Indeed, almost all the IMF’s 50 programmes are for countries outside the eurozone. No country has ever lost money lending to the IMF, and Britain’s contribution is a loan on which interest is payable, and will be used only if troubled economies meet strict conditions to get their economies back on track.

Secondly, I turn to debt and imbalances. As at the G8, there was absolute agreement that deficit reduction and growth were not alternatives—you need the first to secure the second. The G20 also reaffirmed its commitment to reduce global imbalances, with deficit countries strengthening their public finances and surplus countries taking further actions to increase demand and move towards greater exchange rate flexibility. In particular, we welcomed China’s commitment to allow market forces to play a larger role in determining movements in its exchange rate, and to continue reform and increase transparency in its exchange rate policy. This is an important advance for the G20 in dealing with global imbalances, which was of course one of the underlying causes of the crisis in 2008.

In a debt-driven crisis where many countries lack the fiscal space to stimulate their economies, the most powerful tools for growth that we have are monetary activism and structural reform. The G20 agreed that monetary policy should continue to support the economic recovery, and every G20 country has put on the table specific structural reform commitments to strengthen global demand, foster job creation and increase growth potential. The Los Cabos growth and jobs action plan includes mechanisms to hold G20 members accountable for delivering on the reform commitments made. Vitally for us, this includes completing the European single market.

The G20 did not just focus on growth in the largest economies, as it also reaffirmed its vital commitment to supporting private sector-led growth in the poorest countries as the best way of helping people to lift themselves out of poverty. Britain led a significant breakthrough on two of the biggest barriers to successful private sector development in developing countries. First, we drove forward the G20’s anti-corruption plan, including securing agreement on important new principles that will deny to all G20 countries entry by corrupt officials or those who corrupt them. Secondly, on the inability of farmers to access the technology that makes their farming viable, Britain made a substantial contribution to the AgResults initiative, which will harness the creativity of the private sector to help put new technology in the hands of the world’s poorest farmers. We will be building on this further at our special event on hunger, which will be held at the Olympics in London this August.

Fourthly, on trade, we expressed our deep concern about rising instances of protectionism around the world. The President of Argentina had a number of arguments during this summit—not just with me—and it was made very clear to her that recent behaviour by Argentina on both investment and trade protectionism was not acceptable. At this G20, free trade again won the day. We extended our commitment to avoid any new protectionist measures until the end of 2014, and agreed to roll back new protectionist measures that have arisen, including new export restrictions.

Most significant of all, the US and the EU reached a groundbreaking political agreement to move forward with a deep but credible trade agreement with a clear and agreed timetable. The EU-US high-level working group will now produce recommendations for taking this forward by the end of the year. The EU and US make up half of the world’s gross domestic produce, so completing a deal here could provide an enormous boost to growth across the world. That means, of course, jobs and growth in Britain.

Fifthly, on financial regulation, this G20 maintained the political impetus behind the reform of regulation across the global economy. We endorsed the strengthening of the Financial Stability Board in holding all G20 countries to account for delivering on their commitments, which was specifically recommended by the UK report on global governance at the Cannes summit last year. We also agreed to push forward with completing the implementation of Basel III.

In the margins of this summit, I had useful discussions on some of our key foreign policy priorities. On Syria, where the regime continues to pound civilian areas with mortars, attack helicopters and snipers, the EU is today, as a result of UK efforts, extending sanctions to ban any EU companies from insuring ships taking arms to Syria. We will continue work with our international partners, including through the UN to stop the appalling slaughter and help forge a political transition to a democratic future that protects the rights of all its communities.

Finally, on the Falkland Islands, I took the opportunity to emphasise the importance of the planned referendum to President Kirchner. The islanders have had to put up with endless attempts at endless summits to put a question mark over their future. They want to determine that future themselves. No one should be in any doubt that, as far as the British Government are concerned, it is the Falkland islanders who will determine the sovereignty of the islands. I believe that their view will be respected by this House, this country and, indeed, by the world. I commend the statement to the House.

[Edward Miliband (Doncaster North) (Lab)]

I thank the Prime Minister for his statement. Let me start with the foreign policy issues that he raised. On the Falklands, there is support on the Opposition Benches for the absolute need to protect the principle of self-determination for the islanders, and we should always stand up for that.

On the issue of Syria, there is deep concern on all sides about the continued failure of the Annan plan to deliver a cessation of violence. Given the urgency of having an immediate end to the escalating hostilities, does the Prime Minister agree that it is now vital for the international community to unite around the need for the toughest sanctions against Syria? In his press conference after the summit, the Prime Minister said that President Putin has been explicit that he is not locked in to Assad remaining in charge in Syria, but Russia’s Foreign Minister Lavrov said that was not his Government’s position. Does the Prime Minister still believe this to be the case, and does he believe that there is a case for persuading Russia to take a tougher stance?

I shall now turn to the main business of the summit, the economy. The G20 last met in Cannes in November. Since then our country has gone into a double-dip recession, world growth has slowed, and the eurozone crisis has deepened. If ever there was a time for the international community to come together and act, this was it, but frankly—I think that the Prime Minister may himself really recognise this—all that we got from the summit was more of the same: drift and inaction in the face of a global crisis.

The Prime Minister claimed at his press conference afterwards that the summit had

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

That sounded familiar to me—and then I realised why. The Prime Minister had said exactly the same after the last failed summit, in Cannes in November. On global growth, the Cannes summit communiqué said

“should global economic conditions materially worsen”,

countries

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

The list of the countries concerned included Germany.

Well, global conditions have worsened, most evidently in Britain, which is only one of two countries in the G20 to have gone into a double-dip recession. If that communiqué meant anything, it meant that this G20 summit should have been a coming together of the world leaders with a real plan to boost global demand, but what did we get? The Mexico communiqué is a cut-and-paste job which effectively repeats the same words that we heard at Cannes, almost word for word. Perhaps the Prime Minister will be able to tell me whether the words or the commitments of the international community have changed. As far as I can see, it is more words and no action. People will be asking—and rightly so—how much worse the economy has to get.

The tragedy, of course, is that the international community are divided between those who want a decisive move towards growth and jobs, like President Obama and President Hollande, and those whose answer to the failure of the last two years is simply more of the same—the same austerity that is not working—like the German Chancellor and our Prime Minister. Maybe the Prime Minister will be able to tell us whether, with Britain now in a double-dip recession, he was arguing at this summit for anything different from what he argued for last November. From his statement, it certainly does not sound that way.

On the eurozone, the Prime Minister said:

“These are 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—how to recapitalise European banks, how the European Central Bank can stand behind member countries, and how to prevent the escalation of problems in the bond markets? It is more of the same—more kicking the can down the road—and there is no plan for growth in Europe either.

Of course the Prime Minister cannot be part of the solution, but he is part of the problem. No wonder he was looking for something else to talk about during the summit, and of course he found it, although, strangely, it was omitted from his statement—the tax affairs of Jimmy Carr. On Wednesday he could not have been clearer: Jimmy Carr was “morally wrong”. On what he called the “Gary Barlow situation”, he said—I am not making this up, I promise, Mr Speaker—

“As soon as I get in front of a computer I will have a look at it.”

On Thursday, the now-familiar sound of screeching tyres could be heard. The U-turn was well and truly under way. The Prime Minister said:

“I am not going to give a running commentary on different people’s tax affairs. I don’t think that would be right.”

[Interruption.] Members ask about the G20. Tax avoidance is certainly an issue at the G20 summit.

Later, when the Prime Minister’s spokeswoman was asked whether he had had a chance to catch up with the “Gary Barlow situation”, she said:

“He has been very busy.”

By Sunday, even the Prime Minister was saying “I think I’ve said enough.” That is certainly true.

There is one important lesson to be learnt from the last week. In the midst of an economic hurricane, this global summit should have produced action, not words. The reality is that this is a Prime Minister who has come back from the summit with nothing for Britain: nothing to turn around a double-dip recession, nothing to help Britain’s families, nothing to ensure growth in the world economy. No wonder he wanted to spend the summit talking about Jimmy Carr.

[The Prime Minister]

Oh dearie me.

First, let me thank the right hon. Member for Doncaster North (Edward Miliband) for his support over Afghanistan. I welcome that. On Syria, I agree that we should continue to back tough sanctions. On Russia, I had useful conversations with President Putin. Clearly the stance that the Russians take is a matter for them, but we believe that there is a real case for getting together and working to implement, in particular, the parts of the Annan plan that are about political transition, and we will continue to make those arguments.

On the economy, I do not over-claim—

[Ed Balls (Morley and Outwood) (Lab/Co-op)]

Tell us about Gary Barlow.

[The Prime Minister]

I will tell you about that in a minute. I am trying to remember the words that you are and are not allowed to use in the House, Mr Speaker.

I would not over-claim for this summit—clearly, it was a G20, not a eurozone, summit—but I would say to the right hon. Gentleman that there are some battles that we have to fight every year, and the battle to prevent the rise of protectionism is just such a battle. This year, we have moved forward the date before which no one can put in place protectionist measures by another year, to 2014. Frankly, I wish that had gone further, but the idea that we fight this battle once and the fight is over is quite wrong.

The right hon. Gentleman’s problem with the communiqué —of course, he did not say whether or not he would have signed it—is that what he wants is more spending, more borrowing and more debt. The fact is that, while there might be some countries that could afford to spend more, because of the mess he left, Britain is not one of them. I have to remind him that he left us with a deficit that was bigger than those of Greece, Portugal and Spain. He quoted President Hollande, but he might remember President Hollande’s statement in which he said that the national debt is the “enemy” of the left. What a pity it is not an enemy of the left politicians sitting across from us. The right hon. Gentleman says we are part of the problem: frankly, he created the problem.

As for the issue of Jimmy Carr and all the rest of it, we learned from what happened in respect of Ken Livingstone that it is Labour politicians who are involved in tax avoidance, and now we know a new rule: they will stand up for tax avoiders wherever they are.

[Sir Peter Tapsell (Louth and Horncastle) (Con)]

On Syria: last week, in answer to a parliamentary question, the Foreign Secretary agreed that there was some resemblance between Syria and Bosnia. If that is so, will the Prime Minister do his utmost to make sure that the Damascus of 2012 does not become the Sarajevo of 1914?

[The Prime Minister]

As ever, the Father of the House makes a very important point. One of the crucial things we want to see for the future of Syria, whatever the outcome, is that there is proper protection of minorities, including Christian minorities, in that country. We do not want to see sectarian conflict. It has become increasingly clear that there will not be a prosperous and safe future for Syria with Assad still in charge. That is why the political transition that Annan’s plan involves is so important and why we should keep pushing it.

[Mr Peter Hain (Neath) (Lab)]

Can the Prime Minister explain how Britain will retain its influence in the G20 given that his Government are isolating themselves from the main power brokers in the European Union? As Russia and China follow America in becoming superpowers, and as Russia flexes its muscles and India rises too, surely we should be right at the centre of the EU so that we are listened to more, instead of being followers on the margins of the EU?

[The Prime Minister]

If by that the right hon. Gentleman means, “Should we join the euro and just go along with everything that is suggested?”— [Interruption.] Well, that is what would follow, and I do not accept that for a moment. Britain can play a strong role in the EU, but where there are things we do not want to join, such as the Schengen no-borders agreement and the single currency, Britain should stay outside them.

In terms of our relations with the rest of the world, the Government have done a huge amount to increase our relations with China and India, as trade flows in the last few years show: in the last two years, exports to China up 72%, exports to India up 93% and exports to Russia up 109%. We are making a difference where it counts.

[Sir Malcolm Rifkind (Kensington) (Con)]

The Prime Minister referred to the part of the G20 declaration headed

“Intensifying the fight against corruption”,

which endorsed the

“denial of entry to our countries of corrupt officials, and those who corrupt them”.

As these measures were inspired by the tragic case of Sergei Magnitsky, who died in a Russian prison having exposed massive corruption by Russian state officials, is it not ironic that the next chair of the G20 will be Russia, and that President Putin will be chairing the next conference, in St Petersburg? Will my right hon. Friend encourage President Putin, who presumably endorsed this declaration, to ensure that those responsible for the death of Magnitsky and this massive corruption are brought to justice before President Putin chairs that conference a year from now?

[The Prime Minister]

My right hon. and learned Friend makes an important point. The section of the communiqué about corruption is indeed important, and all the countries that have signed up to it should make sure that they put it in place. One of the strengths of the G20 is that, because it is not bringing together countries that necessarily share all the same democratic or human rights values, it is an opportunity to try to push some of those agendas with colleagues sitting round the table.

[Chris Bryant (Rhondda) (Lab)]

The Prime Minister jests about what words are allowed and not allowed in this Chamber; on the Opposition Benches, we would quite like to hear one word more often from his lips: “growth”.

Further to the question from the right hon. and learned Member for Kensington (Sir Malcolm Rifkind), the problem of corruption in Russia is manifest. On 7 March, this House unanimously agreed a resolution, supported by the Government, calling on them to introduce legislative proposals to make sure that those involved in the murder of Sergei Magnitsky and the corruption that he unveiled were banned from this country. When will those legislative proposals be introduced?

[The Prime Minister]

I have to say to the hon. Gentleman that the word I am waiting for from him, because he introduced a point of order claiming that I had misled the House, is “sorry”. To be fair to him, he has said sorry to everybody else—you, Mr Speaker, I think, and to the House in general—but the person he accused of doing something wrong he has yet to say “sorry” to. So, until I get that apology, I think I will leave off the answers.

[Simon Hughes (Bermondsey and Old Southwark) (LD)]

The communiqué was clear that, as a way of agreeing further growth, there should be investment in infrastructure, particularly in housing, which would bring both jobs in general and deal with youth unemployment in particular. Can the Prime Minister say anything about the priority our Government will give to those matters in this country, in order to get youngsters off the dole and houses built for them to live in?

[The Prime Minister]

My right hon. Friend raises an important point. Because we have credibility in financial markets and our interest rates are less than 2%, we are able to use the strength of our balance sheet to help make sure that houses get built, that infrastructure goes ahead and that we help our economy in that way. We are looking at the best way to make this happen.

[Caroline Lucas (Brighton, Pavilion) (Green)]

Given the lack of any discernible progress on ending harmful fossil fuel subsidies since the first G20 pledge on that three years ago, and given the silence about it again today, what would the Prime Minister say to the 1 million people whose petition was handed to him last week asking for an immediate end to those subsidies? Does he really think they are the best use of $100 billion globally every single year?

[The Prime Minister]

The hon. Lady makes a very important point, and there is huge pressure on countries that have big fossil fuel subsidies to end them. A number of countries—such as Nigeria and, I believe, Pakistan—have taken some steps to end the subsidies. It is obviously a difficult and painful process for those Governments to go through as they change the structures of their economy, but we should be encouraging them.

[Richard Ottaway (Croydon South) (Con)]

May I welcome the Prime Minister’s attack on protectionism and support for free trade, particularly the US-EU trade agreement timetable? Does he agree that these are the two largest trading blocs in the world, and together will create an enormous bloc that will have a profound effect on growth and trade across the world?

[The Prime Minister]

My hon. Friend is entirely right to raise this issue—it is half the world’s GDP. There are a huge number of difficulties in getting these talks properly under way; there will be concerns about farm subsidies and about hidden protectionism on both sides. But the pressure from European member states on the European Commission—and, indeed, from the Commission itself—and, I believe, from business in the US on the American President, is to get a deal done, because in the end, it would be very good for all of us.

[Mr Dennis Skinner (Bolsover) (Lab)]

Now that the Prime Minister has had his Jimmy Carr moment, would it not be a good idea to publish a list of all those using tax avoidance schemes, including those closer to home and those who inhabit millionaires’ row?

--- Later in debate ---

[Mr Speaker]

Yes, and I know that that is what the Prime Minister will deal with in his reply.

[The Prime Minister]

I was hoping, for once, that the hon. Gentleman would stand up and applaud what I had said about tax avoidance and aggressive tax avoidance. I thought, for once, we might be on the same side.

[Mr Speaker]

And better still—I beg your pardon to the hon. Gentleman and to the House—to the G20 summit. That would be helpful.

[Mr Peter Bone (Wellingborough) (Con)]

I am very grateful for the Prime Minister’s statement, particularly after he made such an excellent speech on welfare reform earlier today. Could he confirm that the referendum for the Falkland Islands will be binding and solemn? As referendums are such a good idea for people, why can we not have one in this country about our relationship with the European Union?

[The Prime Minister]

That was an excellent link, if I may say so. What is so important about the Falkland Islands referendum, which is very much an initiative that has come from the Falkland islanders themselves, is that it will give the opportunity for the rest of the world to see what the people who live there actually want—lots of countries that are not particularly focused on this issue may, in the past, have gone along with proposals from Argentina without really considering that. When they see it in glorious technicolour, I hope that will make a difference.

[Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)]

The Prime Minister will be aware that last week the Rio+20 conference also took place. As the leader of what he calls the “greenest Government ever”, can he share with us what representations he made in Mexico about that other crucial conference?

[The Prime Minister]

Obviously it is difficult to be in two places at once, so I did the G20 and the Deputy Prime Minister was at the Rio+20 summit. We discussed it a great deal in advance, and I think it did make some useful progress in terms of sustainable goals. I am also going to be working, through this high-level panel to which Secretary-General Ban Ki-moon has appointed me, to make sure that we put in place the right replacements for the millennium development goals and that they take into account sustainable concerns as well.

[Dr Julian Lewis (New Forest East) (Con)]

Does my right hon. Friend agree that events in the eurozone have predictably proven that the creation of the single European currency was a disastrous mistake?

[The Prime Minister]

It would have been a mistake for us to join the single currency, because we did not want to give up the necessary sovereignty to make a single currency work. We have to respect the fact that there are countries in the eurozone that want to make it work, and we have to allow them that opportunity. It would clearly be in our interests if we had a working single currency on our doorstep, rather than a dysfunctional one, which, I am afraid, is slightly what we have at the moment. So we have to make our own choices, and other EU countries must make their own choices, but the key point—this is where I agree with my hon. Friend —is that a single currency will not work unless it has at least the underpinnings that other single currencies, such as our own, have: a central bank right behind it; a means of supporting the weaker parts of the union at various times; and some sort of joint debt issuance. Those are the sort of things that all single currencies, the world over, have. To that extent, I agree with him.

[Chris Leslie (Nottingham East) (Lab/Co-op)]

At the G20, how did it feel for the Prime Minister to be one of only two leaders to have their domestic economies in recession?

[The Prime Minister]

What it feels like at the G20 is that you are around a table with people from other countries that have large budget deficits but not as large as the ones that we were left. We were left with an 11% budget deficit and with the biggest banking bust that had taken place anywhere. So I would say that there is considerable sympathy for that around the table, and a lot of people around the table talk about the complete mess we were left in.

[Mr David Burrowes (Enfield, Southgate) (Con)]

The German Foreign Minister recently wrote in The Times:

“Anyone who wants new flash-in-the-pan stimulus packages financed by yet more borrowing has learnt absolutely nothing from the crisis.”

Who was he talking about?

[The Prime Minister]

I cannot possibly think, but I can think of some people sitting opposite me who do believe that the way to get out of a debt crisis is to borrow more—that is their policy.

[Mr William Bain (Glasgow North East) (Lab)]

The OECD has predicted that economic demand in America will rise this year at 2.3%, but in Britain it will rise at only 0.2%. Can the Prime Minister explain why?

[The Prime Minister]

There some quite significant differences between the American economy and the British economy. One of the biggest differences is that it is a reserve currency and we are not a reserve currency. Another big difference is that we had an 11% budget deficit, which was bigger than the deficits of Greece, Spain and Portugal. That is the legacy that the hon. Gentleman’s party left, and until Labour Members apologise for that legacy, no one is going to take them seriously.

[Several hon. Members]

rose—

--- Later in debate ---

[Michael Ellis]

Thank you very much, Mr Speaker. Does my right hon. Friend agree that the rather ridiculous posturing by the Argentines at the G20 summit tries to hide the fact that it is they who are the real colonialists, because they wish to ignore the democratic wishes of the Falkland Islands people themselves?

[The Prime Minister]

My hon. Friend is entirely right. At the heart of the UN charter is the concept of self-determination, which is why I think that the referendum is important. In many ways, we do not need it to happen in order to know the wishes of the Falkland islanders, which have always been clear, but none the less I think that it will underline that and people will be able to see that it is not Britain that is behaving in a colonialist way but that we are simply doing what the Falkland islanders want us to do.

[Mark Hendrick (Preston) (Lab/Co-op)]

On the basis of what authority is the Prime Minister lecturing the eurozone when two and half years of his Government’s policies have driven this country into a double-dip recession?

[The Prime Minister]

I think that as a net contributor to and full member of the European Union we have every right to say what we think is necessary to fix the crisis. The hon. Gentleman talks about what has happened over the past two years, but I would make the point that 400,000 more people are in work than at the last general election. Unemployment was down this quarter and employment was up, and there are 840,000 more private sector jobs. It is tough and difficult but a rebalancing of our economy is taking place that involves more manufacturing and more exports and that is leading to private sector job growth.

[Conor Burns (Bournemouth West) (Con)]

The Prime Minister referred in his statement to the changes of governance in the eurozone and the remorseless logic of being in a currency union. Those of us who have consistently called this right over the past 20 years have serious reservations about asking countries such as Greece, Spain and Portugal to make the democratic sacrifices that we ruled were unacceptable to the United Kingdom. Does he share our concern that when countries find they cannot change the policies of their Government through the ballot box, it could lead to profound instability in Europe?

[The Prime Minister]

My hon. Friend makes a very good point, but the point that I would make in response is that it is not for us to tell those countries what to do. If countries want to join a currency union, understand that to make that currency union work they have to give up all sorts of sovereignty and freely enter into that bargain, that is a matter for them and not a matter for us. It is for us to decide whether we want to do that, which we do not, and—and, frankly, it is all right to do this—to give advice about what would make a eurozone work better than it is working today.

[Stewart Hosie (Dundee East) (SNP)]

The communiqué reads:

“We are committed to adopting all necessary policy measures to strengthen demand, support global growth and restore confidence”

and

“enhance job creation”.

I welcome monetary activism as one of the tools to help achieve that, but can the Prime Minister explain to the House how his Government’s austerity programme will do anything other than weaken demand, weaken growth and suppress demand for labour?

[The Prime Minister]

I make this simple point to the hon. Gentleman: if we did not have a credible plan for dealing with our debts and our deficit, our interest rates would not be below 2%. It is worth remembering that when this Government took office, Spanish and British interest rates were at the same level. Our rates are now below 2%, which is helpful for growth, for business and for home owners, and the Spanish have interest rates close to 7%. That is the point. The idea that if a country spent more, borrowed more and added to its debts, it would stimulate its economy is probably wrong.

[Several hon. Members]

rose—

[Kwasi Kwarteng (Spelthorne) (Con)]

What assessment has my right hon. Friend made of France’s deficit reduction plan?

[The Prime Minister]

I look carefully at what the French are both doing and saying and it seems to me that their plans to reduce their structural deficit are, if anything, more aggressive than our plans to reduce our structural deficit. I hear from the Opposition that we should learn lessons from France, and the fact is that the French have a deficit reduction programme, it is quite aggressive and they refer to the national debt as the enemy of France and the enemy of the left.

[Jonathan Ashworth (Leicester South) (Lab)]

Did not the G20 communiqué argue that advanced economies should pursue fiscal consolidation at a pace appropriate to support recovery? Why, then, is the Prime Minister pursuing fiscal consolidation at a pace that has contributed to a double-dip recession?

[The Prime Minister]

We are pursuing fiscal consolidation at a pace that is right for the British economy, which is why our interest rates are as low as they are.

[Harriett Baldwin (West Worcestershire) (Con)]

Was the Prime Minister surprised to hear quite a lot of questions about stand-up comedians but that neither Tony Blair nor the Leader of the Opposition have ruled out joining the euro?

[The Prime Minister]

To be fair to the Leader of the Opposition, he has said that whether or not they will join the euro depends on how long he is Prime Minister, whereas the shadow Chancellor has said that they will not join the euro “in his political lifetime”, which gives us an interesting conflict—[Interruption.] For once, the shadow Chancellor has said something from a sedentary position with which I agree. He said that his political lifetime could be quite short—here’s hoping.

[Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op)]

On a more serious note—[Interruption.]

[Mark Lazarowicz]

On a more serious note about the euro, Greece now has a new Government, which indicates that it will accept the bail-out but wants some flexibility in how it is implemented. What will the G20 and other institutions do to meet that request? Of course Greece must accept its responsibilities, restructure its economy and all the rest of it, but at the same time is it not important that we show flexibility, so that we do not run the risk of the new Greek Government collapsing along with the deal and, as a result, bringing down not only Greece, but many others in the world community?

[The Prime Minister]

The hon. Gentleman asks an important question. It will be a decision for the Greeks to make in collaboration with the members of the European Union that have extended that money to Greece, of which we are not one, and of course the International Monetary Fund. The problem is that any delay in the terms of the memorandum effectively means more money going from those predominantly eurozone members to Greece, so those discussions have to be had; but other countries that are on track with the programmes that have been put in place will, I think, feel very uneasy about one country getting special terms. In the end, it will be a matter for the eurozone members and Greece to hammer this out between them.

[Alec Shelbrooke (Elmet and Rothwell) (Con)]

I congratulate my right hon. Friend on facing down the Argentine President and pointing out that we will not be bullied or have any silly stunts. Does that not contrast starkly with either giving away huge European rebates or cosying up to African dictators, and show once again that if we want someone to stand up for sovereignty and British interests, we need a Conservative Prime Minister?

[The Prime Minister]

I am grateful to my hon. Friend for his question. It seemed to me important to try to make that point, not just to Argentina but—almost more to the point—to other countries, which sometimes go along with motions proposed at various international gatherings that are against the interests of the Falkland islanders because they have not heard their voice. People are now going to hear that voice, and I hope the world will listen.

[Gavin Shuker (Luton South) (Lab/Co-op)]

Is not the Prime Minister’s influence in and prescription for the world economy fatally undermined by the first double-dip recession in 37 years in this country?

[The Prime Minister]

The point about what we are saying about the world economy is that, in fact, we are part of the consensus on the need to stop the march to protectionism, to regulate the banks properly, to have credible fiscal plans so that interest rates are kept down, and to have proper monetary activism and structural reforms to deliver growth. That is what the world signed up to at the G20 and it is a consensus that the Labour party is completely out of.

[Christopher Pincher (Tamworth) (Con)]

Given that the Leader of the Opposition seems to have identified the President of France as his special friend, does my right hon. Friend agree that it is worth reminding the right hon. Gentleman of the words of President Hollande, who said that growth cannot be generated by means of further public spending, because that needs to be reined in?

[The Prime Minister]

My hon. Friend is entirely right—that is exactly what the President of France said. He knows that a credible plan to reduce the deficit is necessary to generate growth in any country, and that one is fatally undermined by the lack of that credibility. It is only the left in this country that thinks we can borrow our way out of debt.

[Joan Walley (Stoke-on-Trent North) (Lab)]

May I register the deep disappointment that the Prime Minister did not make the extra journey to attend the Rio+20 Earth summit? Given his remarks about growth, may I ask how he is making the links between the need to go beyond GDP and the importance of natural capital in the arguments and the growth objectives on the G20 agenda?

[The Prime Minister]

That is a perfectly fair question. My judgment was that having done the G8 and NATO summits, then the G20 and an important bilateral visit to Mexico—we should be linking up with the fastest-growing economies in the world—it was better to ask the Deputy Prime Minister to attend the Rio summit, which I believe made some important progress. This Government believe that, as well as GDP, we should be thinking about other measures of sustainability and well-being, and we are measuring those things for the first time in this country, which is giving something of a lead to others.

[Mel Stride (Central Devon) (Con)]

I warmly welcome my right hon. Friend’s support for free trade at the G20, and like him I believe that the free movement of peoples is important to free trade, but does he agree that it was a great dereliction of responsibility by the previous Government not to introduce transition arrangements in relation to those states that joined the EU in 2004?

[The Prime Minister]

My hon. Friend makes an important point. It was the Conservative Opposition who warned that it was a bad decision to allow unencumbered access to British labour markets from countries such as Poland. We well remember being told, “You can’t talk about these things”, that it is somehow racist to discuss immigration, and all the rest of it. Year after year we had to put up with that nonsense, and to get a half-baked apology now is simply not good enough.

[Sir Gerald Kaufman (Manchester, Gorton) (Lab)]

It was interesting to see that the Prime Minister treats correspondence from the President of Argentina in the same way as he treats correspondence from Members of the House. Will he make it clear beyond any equivocation that not only is the sovereignty of the Falkland Islands not open for negotiation, but it is not open for discussion in any forum whatever, and that the wishes of the people of the Falklands to remain British will prevail?

[The Prime Minister]

I can certainly give the right hon. Gentleman that assurance. The referendum of the Falkland islanders will help us to deliver that in practice as well as in theory. Let me say to the right hon. Gentleman that if he writes me a letter, I shall try to respond to it very speedily.

[Mrs Anne Main (St Albans) (Con)]

I share my right hon. Friend’s concerns about the sovereignties and powers that may be given over by some of the weaker countries. I am concerned that we are not having a debate about what sort of chimera will be created by those who will mop up those powers and sovereignties, and I urge my right hon. Friend to speak up strongly on the European Council this week. May we have a debate when he returns from the Council, to inform the House exactly how we are being protected against this newly created large superstate?

[The Prime Minister]

My hon. Friend makes an important point. Of course there will be consequences if the eurozone members go ahead and form a more integrated eurozone, and it is very important that we protect Britain’s interests, particularly our interest in having a fair and open single market. On the issue of how we debate these things in Parliament, the Backbench Business Committee took over all the days for Back-Bench debates including, as I understand it, the time that was previously allotted by the Government for European debates in advance of European summits. So if the Backbench Business Committee wants to put in such debates, I am sure Foreign Office Ministers would be only too happy to answer those debates, which would help inform me before I go off to European Councils.

[Gavin Williamson (South Staffordshire) (Con)]

Does my right hon. Friend agree that it is grossly hypocritical of the Argentine Government to demand talks on the Falklands, while at the same time refusing to accept a letter from the Falkland Island Government about talks?

[The Prime Minister]

My hon. Friend makes a good point. There are a number of things about which the Falkland islanders would like to have proper discussions with Argentina—about the links between the Falklands and countries in Latin America; ordinary conversations that the Falkland Islands should be having with neighbouring countries. What is absolutely clear is that for that to happen, countries need to respect the sovereignty of the Falkland Islands and the decision that people there make.

[Karen Bradley (Staffordshire Moorlands) (Con)]

What benefits might my constituents see from an EU-US free trade agreement?

[The Prime Minister]

If we expanded trade between Britain and America as part of the EU expanding its trade with America, the benefits would be more goods and services and more jobs in the UK, and more opportunities to export. We might find particular advantages to Britain in some of the services fields, where we have very good companies that do not always get full access to US markets. In that way my hon. Friend’s constituents would benefit.

[Mr Marcus Jones (Nuneaton) (Con)]

Despite the economic headwinds of the eurozone crisis, in the west midlands in the past year 4,000 jobs were lost in the public sector, but 81,000 jobs were created in the private sector. Does that not vindicate the Government’s strategy of reducing the deficit and keeping interest rates low?

[The Prime Minister]

My hon. Friend makes an important point. As I said, there are 400,000 more people in work than there were in May 2010. Of course we have seen some job reductions in the public sector, but they have been more than made up—several times made up—by the jobs that have increased in the private sector. That is the sort of rebalancing that our economy needs.

[Nick de Bois (Enfield North) (Con)]

Will my right hon. Friend encourage business to look also beyond the EU to secure growth and future orders, and will he ensure that Government policies are designed to support business to do that and to break down often hidden protectionism in other markets?

[The Prime Minister]

My hon. Friend is entirely right. Part of the Government’s strategy is to link Britain with some of the fastest growing countries in the world, and that is why I have personally taken trade missions to almost all of the G20 countries now, apart from Brazil and Argentina, and I hope to go to Brazil later this year. One of the most effective ways to break down trade barriers is through the EU trade deals. We have done one with Korea; we now need to do one with Japan, and there are many others in the pipeline.

[Gloria De Piero (Ashfield) (Lab)]

The Prime Minister has talked a lot about eradicating the debt. At the start of the Parliament he said he would eradicate it by the end of the Parliament. How is that timetable going?

--- Later in debate ---

[The Prime Minister]

The deficit has been reduced by a quarter in two years.

[Andrew Bridgen (North West Leicestershire) (Con)]

The Argentine Government and the media often repeat the claim that Argentina wants the Falkland Islands back. Does my right hon. Friend agree that no one can have something back that has never been theirs? Argentina has never had legal possession of the Falkland Islands, and unless it is the wish of the Falkland islanders themselves, it never will do.

[The Prime Minister]

My hon. Friend puts it very well; I could not have put it better myself. The key point is self-determination, and that is what the referendum will prove.

[Neil Carmichael (Stroud) (Con)]

Does the Prime Minister agree that the relative strength of the German economy is partly derived from the fact that it has a sensible approach to public finances, and that we should continue to promote that across Europe? Does he also agree that the importance of the European Central Bank needs to be further enhanced?

[The Prime Minister]

My hon. Friend makes an important point. Of course, there is an enormous amount of pressure on Germany to do more to back the eurozone, and I understand and support some of that pressure, but we should remember that the German economy is so strong because it went into the recession with a budget surplus, whereas we had a budget deficit, and it had spent the previous 10 years getting more competitive, building up its industry and making sure its economy was balanced. Sadly, under the last Government we spent too much time imitating Greece, and not enough time imitating Germany.

[Bob Stewart (Beckenham) (Con)]

It seems that 655 Argentines lost their lives in the Falklands war. Does my right hon. Friend agree that if Argentina were to restore proper sea and air links to the Falkland Islands, the families and loved ones of those in the Argentine cemetery would be able to visit it properly, which is what should happen?

[The Prime Minister]

My hon. Friend makes an important point. There is the air link with Chile. Obviously, if there were better relations, there could be air links with Argentina, but that has to be on the basis that Argentina respects the sovereignty of the Falkland Islands and the decision that the people of the Falkland Islands are going to make. Another reason why the referendum is important is that it will put that beyond doubt, and perhaps that will allow better conversations to take place.

[Charlie Elphicke (Dover) (Con)]

Is it not right that international problems such as tax avoidance should be dealt with internationally at meetings such as the G20 summit, particularly as in the UK tax avoidance by individuals and corporations increased massively during the past decade? Is it not wrong and morally repugnant for anyone to attack, belittle or undermine the Prime Minister in dealing with this, particularly as the Leader of the Opposition did in his remarks earlier?

--- Later in debate ---

[The Prime Minister]

I thank my hon. Friend for what he says and make the simple point that tax evasion is illegal and should be pursued properly. Of course there are things that people do to minimise their tax bill, whether it be investing in a pension or an ISA, but as the Chancellor has said, and I totally agree, there are some aggressive tax avoidance schemes that should be roundly condemned, and that is exactly what the Government are doing.

[Mark Menzies (Fylde) (Con)]

The Prime Minister has put support for British exports at the heart of Britain’s economic recovery. What comfort can industries in my constituency that export globally take from the Prime Minister’s work at the G20?

[The Prime Minister]

I very much enjoyed the visit that I made to my hon. Friend’s constituency and to BAE Systems where his constituents are doing excellent work in building the Typhoon aircraft, and we go on supporting the sales of that aircraft. There are a number of important contests at the moment, and the Government are absolutely behind BAE Systems in all of those.

[Andrew Selous (South West Bedfordshire) (Con)]

Manufacturers in my constituency have told me of the important help that they have had from UK Trade and Investment recently—for example, the setting up of webinars in British high commissions and embassies to speak to customers overseas. What more can we do to help British business sell even more around the world?

[The Prime Minister]

I am grateful to my hon. Friend for his question. He heard the figures earlier; some massive increases during the last two years to different countries. UKTI is doing a good job. Members on both sides of the House can help link UKTI to small and medium-sized enterprises in their own constituencies. I think that the figure is that if one in five of our SMEs that currently export moved to one in four, that would probably eradicate our trade deficit. That is an important agenda and I urge all Members of Parliament to help businesses in their constituency in this way.

[Mr John Baron (Basildon and Billericay) (Con)]

Given that no amount of moving the eurozone debt around the system, between bank and Government, can hide or conceal its scale, does the Prime Minister agree that the most important thing eurozone Governments can do to narrow the gap between what is spent and earned is introduce sweeping supply-side reforms and free up small businesses from the dead weight of regulation?

[The Prime Minister]

My hon. Friend is entirely right. Whether it is trying to make the eurozone work better, trying to increase growth in the European Union or trying to compete with the rest of the world more effectively, all those pathways lead back to supply-side reform, structural reform and deregulation initiatives to help make European countries more competitive. That is what Britain is standing up for in Europe. At the summit this Thursday and Friday I very much hope that in the growth plan there will be the very strong commitments we secured at the last two European Councils for these deep structural changes: completing the single market in services, in digital and in energy. All these can add to our GDP and mean jobs and livelihoods for people in our constituencies.

[Mr Speaker]

I am grateful to the Prime Minister and Members of the House for their succinctness, which enabled 41 Back Benchers to question the Prime Minister in 34 minutes of exclusively Back-Bench time.

Oral Answers to Questions

Lord Cameron of Chipping Norton Excerpts

Wednesday 13th June 2012 Commons Chamber

[Zac Goldsmith (Richmond Park) (Con)]

Q1. If he will list his official engagements for Wednesday 13 June.

[The Prime Minister (Mr David Cameron)]

I am sure the whole House will wish to join me in paying tribute to the servicemen who have fallen since the House last met, Captain Stephen Healey and Corporal Michael Thacker of 1st Battalion the Royal Welsh and Private Gregg Stone of 3rd Battalion the Yorkshire Regiment. They were talented, dedicated soldiers who made the ultimate sacrifice for the safety of our nation. Our deepest condolences are with their families, their friends and their colleagues. We will always remember them.

This morning I had meetings with ministerial colleagues and others, and in addition to my duties in this House I shall have further such meetings later today.

[Zac Goldsmith]

I am sure all Members will wish to associate themselves with the Prime Minister’s tribute.

Can the Prime Minister reassure my constituents that for as long as he is the Prime Minister, there will be no policy shift at all in relation to the third runway at Heathrow, and that this Government will focus their attention on improving Heathrow’s hub status by expanding links between London airports and displacing some of the short-haul and less valuable slots elsewhere?

[The Prime Minister]

I know that this is not just a constituency campaign for my hon. Friend but something he feels very powerfully about. I can tell him that the coalition position has not changed, but clearly we must not be blind to two important considerations: how we expand airport capacity overall, and how we ensure that Heathrow operates better and that we welcome people to our country better than we are at the moment. A lot of progress has been made on that agenda, and I congratulate my right hon. Friend the Home Secretary on the extra resources and people that have been put into doing that important job.

[Edward Miliband (Doncaster North) (Lab)]

I join the Prime Minister in paying tribute to Captain Stephen Healey and Corporal Michael Thacker of 1st Battalion the Royal Welsh and Private Gregg Stone of 3rd Battalion the Yorkshire Regiment. They served their country with dignity and bravery, and the condolences of the whole House go to their family and friends.

Can the Prime Minister tell us why he referred Baroness Warsi to the independent adviser on ministerial interests but not the Culture Secretary?

[The Prime Minister]

Yes; I think there is a very significant difference between the two cases. In the case of Baroness Warsi, there has not been a judge-led inquiry, with witnesses taking evidence under oath, to get to all the factual information behind her case. That is why I have asked Sir Alex Allan to look at the case and establish some of the facts. I have to say, I am entirely happy with the explanation that I have been given by Baroness Warsi. She admits to breaking the ministerial code and has apologised for it, and I think that is a very important point.

[Edward Miliband]

The Prime Minister refers to the Leveson inquiry, but can he confirm that, in his appearance there, the Culture Secretary was quite properly—it is not the remit of the Leveson inquiry—not asked a single question about whether he misled this House and thereby broke the ministerial code?

[The Prime Minister]

The right hon. Gentleman asks specifically why I have not referred the case to Sir Alex Allan. As he knows, I have not done that, but I have asked Sir Alex Allan for his advice on future guidance on, for instance, quasi-judicial decision making, which the right hon. Gentleman discussed at the Leveson inquiry and which I will discuss tomorrow as well. Sir Alex Allan has replied to my letter. I will put a copy of both letters in the Library of the House, but the House might want to know what he said:

“I note your decision in relation to Jeremy Hunt’s adherence to the Ministerial Code which is of course a matter for you.”

He went on:

“The fact that there is an on-going judicial inquiry probing and taking evidence under oath means that I do not believe I could usefully add to the facts in this case”.

He went on to say that he remains available if circumstances should change, but those are the views of Sir Alex Allan.

[Edward Miliband]

The key issue is who makes the judgment on whether there has been a breach of the ministerial code. This is what Lord Leveson said on 10 May:

“I will not be making a judgment on whether there has been a breach of it, that is simply not my job”.

In other words, it is the job of Sir Alex Allan.

Let us take one of the issues that was—[Interruption.] I can see that Conservative Members have been well whipped today. They obviously got the memo from the Prime Minister’s aide, who is sending memos round. The last one began: “Comrades”—[Laughter.] I like the sound of that. “We need a protective wall of sound. Last week we rather dried up. Please show sufficient stamina for the full half hour.”

Let us take one of the issues that was not raised at the Leveson inquiry. On 25 April, the Culture Secretary told the House: “I made absolutely”—[Interruption.] There is no point in the part-time Chancellor trying to give the Prime Minister the answer before I have asked the question. The Culture Secretary told the House:

“I made absolutely no interventions”

in “a quasi-judicial” process

“that was at that time the responsibility of the Secretary of State for Business”,

yet we now know that he wrote a memo to the Prime Minister that said:

“If we block it our media sector will suffer for years.”

Will the Prime Minister confirm that the Culture Secretary, in his answer from 25 April, was not straight with this House of Commons?

[The Prime Minister]

Let me first explain that, on the Government side of the House, “comrades” is a term of endearment, not an official title—[Interruption.] Liberal Democrat Members are also comrades.

The point is that it is the job of the Prime Minister to make the judgment about ministerial code. I have made that judgment. I have quoted what Sir Alex Allan has said. He was very clear that he could not

“usefully add to the facts in this case”.

I am sorry that the political strategy behind the right hon. Gentleman’s Opposition motion has collapsed, but that is the fact of the case.

The right hon. Gentleman asked specifically about the note that the Culture Secretary sent to me on 19 November, in which he specifically says that it would be completely wrong to go against the proper regulatory procedures. The truth of what has happened in recent days is that the Culture Secretary gave a very full account of his actions to the Leveson inquiry, and demonstrated that, when it came to the BSkyB bid, he took independent advice at every part of the process and followed independent advice at every stage of the process, which is a complete contrast to how the previous Government behaved.

[Edward Miliband]

Let us be clear about what the Prime Minister is claiming. The Culture Secretary told the House:

“I made absolutely no interventions seeking to influence a quasi-judicial decision”.—[Official Report, 25 April 2012; Vol. 973, c. 543.]

The Prime Minister is claiming that a memo to the Prime Minister is somehow an insignificant document in relation to a decision that the Government must make. It is the first time in political history that that is the case.

If the Prime Minister’s case is so strong, why is the Deputy Prime Minister not supporting him?

[The Prime Minister]

Let me read exactly what the note from the Culture Secretary from 19 November states:

“It would be totally wrong for the government to get involved in a competition issue which has to be decided at arm’s length.”

When he got responsibility for the dossier, he behaved in exactly that way.

By the way, the whole reason we are discussing this takeover is that the previous Government changed the law to allow a foreign company to own a British broadcasting licence. Labour Members conveniently forget that point.

The Leader of the Opposition asked specifically about the Deputy Prime Minister. Let me be frank: we are talking about the relationships that Conservative politicians and Labour politicians have had over the past 20 years with News Corporation, News International and all the rest of it. To be fair to the Liberal Democrats, they did not have that relationship. Their abstention tonight will make that point. I understand that: it is politics—[Interruption.]

[Mr Speaker]

Order. The House must calm down.

[Edward Miliband]

I have to say that the right hon. Gentleman has reached a new state of delusion—really and truly. He just wants to talk about the past—he was the future once. The Deputy Prime Minister says that the decision should go to the independent adviser, the Conservative chair of the Select Committee on Public Administration says it should be referred and the former chair of the Committee on Standards in Public Life says that it should be referred—is it not the truth that the reason the Prime Minister will not refer the Culture Secretary to the independent adviser is that he is scared that the Culture Secretary will not be cleared?

[The Prime Minister]

Imitation is the sincerest form of flattery. The right hon. Gentleman says that we are talking about the past, but some elements of the Leveson inquiry and the relationship between politicians and the press are about the past. We had a little insight into that when the former Prime Minister, the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown), gave evidence. In an extraordinary moment, he said that

“the one thing I can say”—

the one thing—

“definitely is that nobody in my position would have instructed…briefing against a senior minister”.

Perhaps the victims could put their hands up. Any takers? I do not need Sir Alex Allan to adjudicate on that one.

[Edward Miliband]

The reality is that everyone knows that it was the Prime Minister who decided to appoint the Culture Secretary to oversee the bid and it is the Prime Minister who is clinging on to him now in the face of all the evidence. Does he not realise that it is no longer about the Culture Secretary’s judgment but about the Prime Minister’s, which is so badly flawed that even his deputy will not support him?

[The Prime Minister]

I hope that the England football team is better at putting the ball in the back of the net. The point is that it is for the adviser on ministerial standards to discover the facts and for the Prime Minister to make the judgment. My judgment is that we should let the Culture Secretary get on with organising the most important event, which is the Olympics. As we are on the Olympics, let us consider this: if there was an Olympic medal for double standards and rank hypocrisy, the Labour party would be well in the running.

[Mr Speaker]

I call Mr Nigel Adams—[Interruption.] I am really very worried about the conduct of the Education Secretary. In the average classroom, he would have been excluded by now. He must calm himself.

[Nigel Adams (Selby and Ainsty) (Con)]

Q2. As we remember those who fell 30 years ago during the Falklands war, Argentina continues to dispute British sovereignty over those islands yet continues to receive loans worth billions of pounds from the World Bank, in which British taxpayers are a major shareholder. Will the Prime Minister join President Obama in instructing his officials to vote against any more such loans to Argentina?

[The Prime Minister]

My hon. Friend makes an important point. No British taxpayers’ money is spent on World Bank loans to Argentina, and I think that that is an important point, but what is even more important is what happened yesterday. The Falkland islanders have decided that they will hold a referendum to demonstrate that they believe in self-determination. That is important because Argentina continues to try to hide the argument and to pretend that the views of the Falkland islanders do not matter. They do matter; I hope that they will speak loudly and clearly and that Argentina will listen.

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

Q3. The Prime Minister just said that he believes that the Leveson inquiry dealt with all the relevant issues regarding the Secretary of State for Culture, Media and Sport, but it did not deal with section 118 of the Financial Services and Markets Act 2000, which deals with market abuse and the passing of information to one party that is not available to others in a market situation. Given the hundreds of texts, e-mails and memos in this case, will he ask the Financial Services Authority to examine the evidence and see whether there has been a breach of section 118 or any part of that Act?

[The Prime Minister]

Clearly there are very strict rules, including the stock exchange code and the Act that the right hon. Gentleman mentions, governing all of these areas. The point I would make to him is that there is no doubt that the special adviser did behave wrongly. That is why he offered his resignation and that is why it was accepted.

[Richard Graham (Gloucester) (Con)]

Q4. I am sure that all hon. Members will congratulate the volunteers who raised £6.5 million to recognise the contribution and sacrifice by Bomber Command personnel in the second world war. The memorial will be opened by Her Majesty the Queen on 28 June, but the costs for security on the day have risen sharply. Despite necessary constraints on all Government expenditure, will my right hon. Friend consider financial support from the Government to ensure that veterans and their relations are properly looked after?

[The Prime Minister]

My hon. Friend is right to raise this issue. Many people served in Bomber Command during the second world war and many lost their lives, so it is right that there will be this splendid memorial, unveiled by Her Majesty the Queen. These memorials tend to be paid for by public subscription and that is what has happened in this case, but I will look carefully at what my hon. Friend says. The Department for Culture, Media and Sport does have the ability to intervene, especially when monuments and other things are done on a national basis for a national purpose. I am sure that the Culture Secretary will have listened carefully to what my hon. Friend said.

[Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)]

Q5. Because of top-down Government health cuts, South Tees hospitals such as the Friarage and Guisborough hospitals in my constituency have had reduced services, leaving both hospitals uncertain of their future. Therefore, will the Prime Minister support his Foreign Secretary, who said to a crowd of 4,000 people that the Government NHS cuts are “unacceptable”?

[The Prime Minister]

I would point out that the increase in health spending for the hon. Gentleman’s primary care trust is 2.9%, a £8.2 million increase for the current year—[Interruption.] That is what is happening. The only reason more money is going into the health service in his constituency is because this coalition Government decided to invest in our NHS, against the advice that we received from the Opposition, who think that increases in health spending are “irresponsible”.

[Mr Philip Hollobone (Kettering) (Con)]

Q6. If he will hold a future Cabinet meeting in Kettering.

[The Prime Minister]

As my hon. Friend knows, Cabinet meetings are occasionally held outside London, not least so that we can get Cabinet Ministers to different parts of the country to meet all sorts of different organisations. The Cabinet has so far met in Bradford, Derby, Ipswich, Cardiff and the Olympic park. Locations for future meetings—including, I hope, the east midlands—will be announced in due course.

[Mr Hollobone]

Were the Cabinet to come to Kettering, it would be able to congratulate Kettering borough council on its pledge to freeze its council tax for the next five years, and to celebrate the £210 million funding from the Department for Transport for the widening of the Kettering A14 bypass. But will my right hon. Friend also commit to upgrade and electrify the midland main line, a project that enjoys cross-party support and that would make a big difference to the Kettering economy?

[The Prime Minister]

I certainly join my hon. Friend in congratulating his borough council. That commitment on council tax is remarkable and shows what value-for-money services Conservative councils can provide. We are committed to electrifying more than 300 miles of railway routes, which compares with just nine miles that were electrified in the 13 years of the last Labour Government. There is a large amount of support for the midland main line electrification and the decision will depend on whether it is affordable and on assessing competing priorities, but I will listen very carefully—as I know the Treasury will too—to what he says.

[Mr Elfyn Llwyd (Dwyfor Meirionnydd) (PC)]

Given that the purpose of the Leveson inquiry is to get at the unvarnished truth about the unhealthy relationship between some politicians and the media, why do Government Ministers, including the Prime Minister, need to be briefed and coached by lawyers before attending to give evidence?

[The Prime Minister]

What Ministers, I am sure, are doing, as I have done, is refamiliarise themselves with a huge amount of evidence going back over seven years. For instance, I have provided to the Leveson inquiry all the evidence I can find of meetings with press editors, proprietors and the rest going back to December 2005. There is a huge amount of information preparation, which I think is entirely appropriate.

[Fiona Bruce (Congleton) (Con)]

Q7. My constituency has a high recycling rate—the best in the north-west—so does the Prime Minister believe it right for a huge waste-burning incinerator to be built there? The incinerator was rejected by the local planning board, is overwhelmingly opposed by my constituents in Middlewich and would involve transporting lorry-loads of waste hundreds of miles across the country. Will he do what he can to prevent an inappropriate development that surely cannot be called environmentally sustainable or an example of true localism?

[The Prime Minister]

I completely understand my hon. Friend’s concern; she is right to raise this issue and I can understand her disappointment that the local planning board’s decision was appealed against. As she knows, however, appeals against a decision on such a planning application can be made to my right hon. Friend the Secretary of State for Communities and Local Government. She can make her views clear. It would be inappropriate to prejudge any decision that he might take, but obviously there is a need to take into account the size and scale of any proposed development and to consider the potential effect on any local community. I am sure that she will want to make those points.

[Grahame M. Morris (Easington) (Lab)]

Q15. The Prime Minister will be aware of the latest British social attitudes survey showing a record fall in public satisfaction with the NHS. I would like to know—I would appreciate an answer because his Health Secretary would not give me one yesterday—whether the Prime Minister will intervene to stop the scandal of the NHS having to reply on charitable donations to fund the purchase of the latest advanced radiotherapy equipment in regions such as mine, the north-east, and throughout the country?

[The Prime Minister]

The Government are putting record sums into the health service—we are increasing the money going into the health service—but if the hon. Gentleman wants me to stand here and criticise the volunteers, the charities and the big society, which provide so many scanners and great machines for our health service, I certainly will not. It adds to our health service. He raised, in particular, the survey. There is a 2011 survey of people who have actually used the health service, rather than one that asks people about their perceptions, and it found that 92% of in-patients rated their overall experience as good, very good or excellent. That is what is happening in our health service, and we should be proud of it.

[Kris Hopkins (Keighley) (Con)]

Q8. Will the Government go ahead with High Speed 2? The project is extremely important to the economy and jobs in the north. If the answer is yes, I suggest we start laying the track in west Yorkshire first.

[The Prime Minister]

I am grateful for that enthusiastic endorsement. I believe that we should go ahead with HS2. It is important for the country’s economy, and it is important that we get on board this high-speed rail revolution. It links to the question asked by my hon. Friend’s neighbour, as it were, my hon. Friend the Member for Richmond Park (Zac Goldsmith), about Heathrow. Many flights could be avoided if we had a network of high-speed rail in our country, and I am keen to press ahead.

[Tristram Hunt (Stoke-on-Trent Central) (Lab)]

Q9. Before the last general election, the Prime Minister made an important speech condemning crony capitalism, “with money buying power, power fishing for money, and a cosy club at the top making decisions in their own interest.”Is that not a pitch-perfect description of the undignified courting of News Corporation by the Culture Secretary? When will the Prime Minister show some judgment on this?

[The Prime Minister]

If they are looking for volunteers for the Olympic team for hypocrisy, I think we might have the decathlete. We had 13 years of pyjama parties, christenings, changing the law and sucking up to the Murdochs. Honestly, what a lot of brass neck!

[Bob Blackman (Harrow East) (Con)]

Q10. In 44 days, the Olympics and Paralympics come to London, and millions of people will be coming to London to enjoy the games. Most of them will be totally dependent on public transport to reach the venues. Will my right hon. Friend condemn the Unite union for calling bus strikes, and does not the silence from the Labour party on this subject speak volumes about their attitude to Londoners?

[The Prime Minister]

My hon. Friend is entirely right. If we want an example of crony politics, frankly, it is the fact that the party opposite gets £5 million from the Unite union, and when it comes to this strike, which could disrupt the Olympics, we have had absolute silence—not a word of condemnation. It is not surprising, because the Unite union does not just give the Labour party the money; it picks its leader as well.

[Toby Perkins (Chesterfield) (Lab)]

The patient satisfaction survey results have shown the greatest reduction in patient satisfaction in the history of the national health service. What will the Prime Minister do to turn around perceptions of the failure of the NHS under his Government?

[The Prime Minister]

The King’s Fund, which carried out this survey, says:

“There is no evidence of a real decline in service quality or performance”.

That is what the King’s Fund says about its own survey. Frankly, I would put more weight on a survey of people who have actually been using the NHS. As I said, of the users of the NHS, 92% of in-patients and 95% of out-patients rated their overall experience as good, very good or excellent. I do not think that is surprising, because since the election there are 4,000 more doctors, mixed-sex accommodation is down 96%, hospital infections are at their lowest levels since surveillance began, the number of people waiting more than 18 weeks is also at its lowest since records began, and average waiting times are down as well. The health service is performing extremely well and we should praise all those who have delivered that performance.

[Steve Brine (Winchester) (Con)]

Q11. As a constituency MP, the Prime Minister will be aware of the current shortage in primary school places across our country. It is particularly acute in Winchester right now, where temporary classrooms are the order of the day, to accommodate reception year pupils for this September. May I ask the Prime Minister what the Government are doing to help councils in this bulge year, and whether he is confident that enough is being done to prevent a repeat performance when those pupils reach secondary school in six years’ time?

[The Prime Minister]

My hon. Friend raises an important point. I know that in certain constituencies this is becoming an issue. What the Department for Education has done is put aside £1.4 billion of schools capital for 2011-12 and a further £1.4 billion for the subsequent year. There is also the opportunity, through free schools, to have excellent new schools established in hon. Members’ constituencies, so that we get not only new capacity, but the competition and choice that I believe will help to drive up standards.

[Alison Seabeck (Plymouth, Moor View) (Lab)]

The use of food banks in Plymouth has gone up, from 790 food banks to nearly 4,000 in a year. Is the Prime Minister proud of the fact that it is his changes to benefit arrangements which are causing this to happen—there is no doubt about that—and is he therefore going to stand up and say, “Yes, that’s fine; food banks are lovely”? Yes, they are lovely, and the people of Plymouth are magnificent in the way they feed in to those, but will he pass the buck on this, and go for a gold medal in passing the buck, as he has over the Culture Secretary—

[Mr Speaker]

Order. We get the drift.

[The Prime Minister]

First, let me join the hon. Lady in praising people in Plymouth, who obviously do a huge amount for their neighbours and members of their community. That is all to the good. What I would say is yes, we have had to make difficult decisions, but we have actually protected tax credits for the least well-off and we have protected benefits for the least well-off. However, I have to say that the biggest welfare reform that we have made is to put a cap on welfare, where we have said that people should not be able to get on welfare more than the average family gets in work, which is £26,500 a year. However, when we put that forward, the Labour party voted against it.

[Mr Robin Walker (Worcester) (Con)]

Q12. Can my right hon. Friend tell the House how much it would have cost this country to take part in the bail-out of Spain’s banks this week if he had not stood up for Britain and got us out of the previous Government’s commitments?

[The Prime Minister]

My hon. Friend makes an important point. Before this Government came to power, bail-outs were carried out with Britain playing a full part—often by as much as 14% of the total—so in a €100 billion bail-out of Spain, Britain could have been paying as much as €14 billion, or £10 billion. That money has been saved because this Government, unlike the last one, stand up for Britain in Europe.

[Steve Rotheram (Liverpool, Walton) (Lab)]

Prime Minister, an omnishambles of Budget that you claimed you had read line by line; a double-dip recession that you made in Downing street; and a Tory-led Committee reporting that the coalition “lacks strategic direction”—evidence, if ever it was needed, that men can multi-task. It is just, obviously, that some are not very good at it. Prime Minister, have you now run out of steam, or is the job just too big for you?

[The Prime Minister]

I am very pleased that my right hon. Friend the Education Secretary is introducing compulsory poetry reading lessons in class. Perhaps we could start with the hon. Gentleman. [Interruption.]

[Mr Speaker]

Order. What is rude is for people to continue shouting when they have been asked not to do so. I know that the hon. Member for Colne Valley (Jason McCartney) is exceptionally well behaved, and I know that he will sit in his usual quiet, respectful fashion.

[Mr David Burrowes (Enfield, Southgate) (Con)]

Q13. The Prime Minister has called for compassion for my constituent, Gary McKinnon, who doctors report is likely to take his life if he is extradited. The Deputy Prime Minister has also said that it would be cruel to extradite him. Will the Government be true to their word and stop the extradition and, finally, after 10 years, give Gary McKinnon his life back?

[The Prime Minister]

I know that my hon. Friend has campaigned long and hard on this issue. As he knows, the Home Secretary is carefully considering a wide range of material before making her decision. She has instructed two independent medical experts to view the various reports that have been submitted in this case. She will make her decision as quickly as possible, but this is not an easy case. A number of difficult issues have to be considered before she makes that announcement.

[Gloria De Piero (Ashfield) (Lab)]

The popular NHS walk-in centre in my constituency has recently closed, and similar walk-in centres are closing all over the country. Why?

[The Prime Minister]

It is certainly not because the money in the NHS is being cut, because it is not being cut. The money in the NHS is being increased. If we had followed the hon. Lady’s advice, however, the money would be going down. What matters is that the money in the NHS is spent to deliver better health outcomes, and I think that that is a decision that needs to be taken locally.

[James Morris (Halesowen and Rowley Regis) (Con)]

Q14. Given the fascinating evidence that was presented by his predecessor to the Leveson inquiry, does the Prime Minister agree that it would be overwhelmingly in the public interest to publish the Downing street phone records, so that we can finally establish what conversations took place between his predecessor and Rupert Murdoch?

[The Prime Minister]

As my hon. Friend knows, Governments cannot release information provided by previous Governments, but I am sure that this is an issue that the previous Prime Minister will want to consider, given the very clear statement that he made.

[Mark Durkan (Foyle) (SDLP)]

The Prime Minister will probably not be aware that a firm in my constituency, Niche Drinks, produces cream liqueurs and other intermediate alcohol products. I do not know whether he ever chillaxes with such commodities. The company has recently planned a £10 million investment, and more than 40% of its exports are outside the EU. However, it and other similar firms on this island are worried that Her Majesty’s Revenue and Customs is reinterpreting how to treat their products for duty purposes, under pressure from the European Commission following its erroneous interpretation of a European Court of Justice ruling in 2009. Will the Prime Minister ensure that a competent Treasury Minister meets me and other interested MPs to ensure that common sense and consistency prevail?

[The Prime Minister]

I have not tried one of those delicious-sounding beverages. If it is all right with the hon. Gentleman, I will wait until after tomorrow before doing so. I understand that there is an issue with HMRC, and I would be very happy to arrange a meeting between him and a Treasury Minister so that they can look carefully at this issue.

[Mr Mark Williams (Ceredigion) (LD)]

Unprecedented levels of flooding hit the north Ceredigion communities at the weekend, causing untold damage to households, businesses and infrastructure. I thank the Prime Minister for his words of support to my constituents, and I know that he is aware of the speed with which Ceredigion county council, the emergency services and many in the local community rallied to ensure that there was no loss of life. Will he urge all the insurance companies to act on this matter now, with renewed speed, so that we can get the communities back on their feet as quickly as possible?

[The Prime Minister]

I certainly join my hon. Friend in praising the emergency services, which did a superb job at the weekend. I asked the Secretary of State for Wales and the Welsh First Minister to pass on my best wishes for the work that the emergency services had done. It was remarkable work. In all these flood situations, there is a rescue and emergency part, followed by a recovery phase. In many ways, the most difficult phase to get right is when people are going back into soaked homes with peeling plaster and all the other problems. That is when we need to ensure that they get swift action in the form of help from their district council and, above all, from the insurance companies. I will certainly work with my hon. Friend to ensure that that happens in this case.

G8 and NATO Summits

Lord Cameron of Chipping Norton Excerpts

Wednesday 23rd May 2012 Commons Chamber

[The Prime Minister (Mr David Cameron)]

I welcome your announcement, Mr Speaker. Daw Aung San Suu Kyi is a remarkable woman, who for so many years has been effectively imprisoned in her own country. It is an incredible testament to change in that country that she is now able to travel and speak freely, including in this Parliament.

With permission, Mr Speaker, I would like to make a statement on the G8 and NATO summits, which I attended in America last weekend. The common theme across both summits was economic stability and international security.

At the G8, we reached important conclusions on dealing with our debts, growing our economies and dealing with the risks in the eurozone. Let me take each in turn.

Deficit reduction and growth are not alternatives. We need the first to deliver the second. There was absolutely no debate about this: it was my view, Chancellor Merkel’s view, President Obama’s view and President Hollande’s view. Indeed, France will balance its budget at a faster rate than Britain.

In Britain, in two years, we have cut the deficit we inherited from the last Government by more than a quarter. Our approach has been endorsed again by the International Monetary Fund this week, and by the OECD. At a time of tight budgets, a proper growth plan requires not just a credible fiscal policy, which secures the low interest rates about which I was speaking just a moment ago, but structural reforms to make our economies more competitive, active monetary policy, and innovative use of our hard-won credibility to ensure investment in long-term infrastructure. We are taking all those steps in the UK and promoting them in Europe as well. In every area, we need to do more.

Prime Minister Monti and I have gathered 10 other EU leaders to call for the completion of the single market in digital and services—classic structural reform to our economies. President Hollande is coming forward with creative proposals, such as project bonds, and, as the House knows, in recent months the European Central Bank has helped supply liquidity to European banks. I will pursue all those elements at the informal European Council tonight, and at the formal Council in June, after which I will of course make a statement to the House.

Growing our economies also means doing everything we can to get trade moving. At the end of the G8 meeting, there was a serious and substantive discussion about the potential for an EU-US trade deal. The EU and US together make up half the world’s GDP. There is a huge amount of work to be done—and a further effort will be made and a report will be produced at the G20 next month—but that could have a positive impact on both sides of the Atlantic.

The greatest risk facing the eurozone and, indeed, the world economy, is clearly the situation in Greece. The future of Greece is for the Greek people to determine. It is for them to decide what is best for their country. However, we cannot afford to allow that issue to be endlessly fudged and put off. The Greek election should in effect be a straightforward choice between staying in the eurozone—with the responsibilities that that entails—or taking a different path. The eurozone—and Europe as a whole—needs to have contingency plans in place for both eventualities. That should involve strengthening banks, protecting financial systems and ensuring decisive action by European institutions to prevent contagion. Whatever the outcome, this Government will do whatever is necessary to protect this country and secure our economy and financial system.

Alongside the discussion on the economy, I had two further priorities at the G8: to continue the good work of the G8 on development, and to support the Arab spring and the promotion of democracy and reform.

On development, the New Alliance for Food Security and Nutrition is an important initiative that aims to help 50 million people lift themselves out of poverty over the next 10 years. For countries to receive help, they need to show a real commitment to transparency and good governance. In return, they get substantial support to generate private sector investment in food production. I believe that that is a great combination of promoting good governance and helping Africa feed its people. I will be building on this with a major event on hunger during the Olympic games in the UK.

Encouraging the private sector to create jobs is one of the best routes to sustainable, equitable growth in poorer countries. However, aid still has a vital role to play. For the first time in a decade the amount of aid given by the world’s richest countries to the world’s poorest countries has fallen back. Promises are being broken, and that is wrong. Britain continues to honour its commitments. Other nations should do likewise, and in the G8 that we will chair next year, we will once again produce the report that shows who has and who has not kept their promises.

The G8 also reached important conclusions on Libya, Iran and Syria. Specifically on Syria, there was backing for the Annan plan, and for further UN measures if Assad does not change course. It was significant that the Russians agreed to that text.

I raised Burma and the need to support the foundations of a lasting and irreversible transition to democracy. I want to make that a feature of our G8 next year. I am sure the whole House looks forward to welcoming Aung San Suu Kyi when she addresses Parliament next month.

Let me turn briefly to the NATO summit. Some people write off NATO as a relic of the past, but I believe it is vital to our future security. The threats NATO countries face largely come from beyond our borders—from failed states, terrorism and nuclear proliferation. Because of that, it makes sense for NATO to be prepared, to link up with partners around the world, to act out of area, and to spend less on the weapons of past conflicts such as battle tanks and more on the technology needed for tomorrow’s conflicts. All those things were agreed at the summit.

That is not to say that NATO should not take steps to defend Europe and north America—it should, and we declared at the summit that the interim ballistic missile defence capability to protect Europe is operational. It was particularly good to have a special session with the partners who work with NATO around the world, and in particular the 50 countries that make up the NATO-led alliance in Afghanistan.

NATO’s military commanders set out the progress in the campaign. Attacks by insurgents are down and transition to Afghan control is on track. Over the next few weeks, we will reach the point at which 75% of the population will be living in areas where Afghan forces are in the lead for security. The vital next steps are to deliver the final stages of transition, and to continue the build-up of the Afghan national security forces and ensure they are properly funded for the future. Britain is pledging £70 million—$100 million—a year, but it is right that other countries should step up and contribute to the future of Afghanistan, irrespective of the role they have played so far. The summit marked a turning point in those contributions, with almost $1 billion being pledged to support the Afghan national security forces.

Britain has played a leading role in the alliance for reasons of our own security. Three years ago, some three quarters of the most serious terrorist plots against Britain had links to Afghanistan and Pakistan. I am now advised that that figure has fallen to around a half. Our aim is an Afghanistan that is able to take care of its own security without the need for foreign troops, and an Afghanistan that can prevent al-Qaeda returning and posing a threat to us and to our allies around the world.

The tremendous hard work of our courageous servicemen and women is making that possible. After 10 long years, they will finally be coming home. I pay tribute to them. Their service and their sacrifice is beyond measure. We remember in particular all those who have given their lives in this vital task to keep our country safe, and I commend this statement to the House.

[Edward Miliband (Doncaster North) (Lab)]

I am grateful to the Prime Minister for his statement. Let me start with the NATO summit. On Afghanistan, the Opposition welcome the summit’s confirmation that the transition of full security responsibility from the international security assistance force to the Afghan national security forces is set for completion by mid-2013, and that British combat operations are set to end by the end of 2014.

Let me echo the Prime Minister’s words about our troops. They have served heroically in Afghanistan for more than a decade now, and we owe them enormous gratitude. I am sure I speak for the whole House and the Prime Minister when I say that we want to see them home with their families in the right way—one that respects the professionalism they have shown and the sacrifices they have made. To that end, will the Prime Minister give the House a clear indication of the timetable for the expected draw-down of British combat troops between now and 2014? Will he tell us how many British service personnel he expects to remain in Afghanistan after 2014 and which services they are likely to be drawn from, and will he confirm that they will remain under a NATO command and control structure? Will he also tell the House whether he has had discussions with President Zardari on the important issue of land access across Pakistan, which is so vital for British military and ISAF supplies?

On the political situation in Afghanistan, does the Prime Minister agree that honouring the sacrifices and bravery of our troops means taking the political challenge there as seriously as we take the military challenge? Given that the final stage of the military campaign is under way, what concrete steps will now be taken that were not already in place before the Chicago summit to secure an inclusive political settlement within Afghanistan and between Afghanistan’s regional partners? Does he agree that the international community has talked for a long time about talks about talks on the political settlement we need, and that we need far greater urgency in seeking that settlement for when our troops come home?

On the G8 summit, we join the Government in calling for an immediate end to violence to stop the continuing bloodshed in Syria, and I join the Prime Minister in his remarks on Burma.

On the global economy, we desperately needed a plan for growth, for both Europe and the international community. The Prime Minister entertained Opposition Members with his description of President Hollande as his new best buddy, given that he endorsed the President’s opponent in the most fulsome terms. The Prime Minister told Le Figaro:

“Nicolas Sarkozy has my support. I say it clearly.”

The Foreign Office was a bit perturbed and started briefing about that, saying:

“We put all the chips on one card and it turned out not to be the ace...It was an error of judgment and not what was advised”.

Perhaps he will tell us whether he was advised to see President Hollande but twice refused to do so? The Foreign Office also said something that, after today, I think we can all concur with:

“The Prime Minister has a habit of shooting from the hip.”

That is certainly true.

In reality, we did not get the conclusions and action we needed from the summit because the international community is divided—not united, as the Prime Minister said—between those who believe we must have a decisive shift towards growth, such as President Obama, now joined by President Hollande, and those who believe that the answer lies in more of the same, such as the German Chancellor and this Prime Minister. For two years he has been the high priest of austerity, telling the world that austerity alone is the answer, but now the recognition has dawned that it is not working, and he finds himself on the wrong side of the argument. That is why he is desperately scrabbling around to say that President Hollande is his great friend.

What has the Prime Minister delivered at home? The recovery has turned to recession, there has been no growth for 18 months and 1 million young people are out of work. He was fond of quoting yesterday’s IMF report, but he did not quote this from Christine Lagarde:

“Growth is too slow and unemployment—including youth unemployment—is too high.”—

[Interruption.] Hang on a sec. I am getting to it. She continued:

“Policies to bolster demand before low growth becomes entrenched are needed”.

That is not his position. His position is: more of the same. So we have the ultimate irony of a Prime Minister who has delivered a double-dip recession lecturing other people on how to get growth.

What did the Prime Minister actually achieve at the summit? We know some of the things he did. He watched the football—nice pictures! He went to the gym. He even squeezed in some sight-seeing. The only thing there is not a photo of is of him making a difference to the world economy—in other words, doing his job. At the G20 last November, he signed a communiqué stating that if “global conditions materially worsen”, countries will take action “to support domestic demand.” Well, global conditions have worsened, so where is the action for growth? Where is the decisive shift we need across the global economy? Why has he not delivered it? He has not delivered it because he does not believe in it.

The Prime Minister is actually making things worse, not better. Last Sunday, the Chancellor went on television and said that speculation about the break-up of the euro was damaging Britain’s economy. He said that

“it’s open speculation…about the future of some countries in the eurozone which I think is doing real damage”.

Will the Prime Minister explain, then, why he decided to do just that last Wednesday and say, “Make up or break up”? It might have rhymed, but does he not understand that it did nothing to help our economy or anyone else’s?

Given the seriousness of the position in Greece, does the Prime Minister really believe that for him to deliver an ultimatum to Greek voters over the weekend about their election was such a good idea? I would have thought that after his experience of the French election, he might have realised it was not such a good idea to get involved.

Finally, on tonight’s European summit, euro bonds are important and a stronger firewall would make a difference, but the crucial thing is demand. Does he not accept that without a plan for growth and demand in Europe, we cannot get a solution on deficits across Europe that is either politically or economically sustainable? The problem with this Prime Minister is that he can only offer more of the same. He cannot be part of the solution because he is part of the problem. All he offers is more austerity. It is not working in Britain, and it is not working in Europe. It is a failed plan from a failing Prime Minister.

[The Prime Minister]

Five minutes and absolutely no plan! The Leader of the Opposition had nothing positive to say. It was a good joke about Sarkozy, but let me say this: we all have our faults, but I would rather have a reputation for being loyal to my friends than for knifing my brother.

The right hon. Gentleman started with NATO and asked some serious questions, so let me give him some serious answers. He asked for a clear indication about the draw-down. We will go down to 9,000 troops by the end of this year. Clearly, we need to set out a pathway between now and the end of 2014. I want it to be based on the conditions on the ground and on how well the transition is going in the three provinces for which we are responsible. Obviously, I will keep the House updated on that. We do not want a great cliff edge at the end.

The right hon. Gentleman asked what would be left at the end of 2014. We have made a clear decision on this. President Karzai asked us to provide an officer training college in Afghanistan and we will be doing that. We have the assistance of the Australians and the New Zealanders on that, and we hope that others will be joining in. That is the baseline of our commitment, but clearly we will listen to any other requests. The right hon. Gentleman asked whether it would be a NATO-led operation in terms of training: yes it will, but there will not be NATO combat operations after 2014.

The right hon. Gentleman asked about the relationship with Pakistan and about the vital issue of the ground lines of communication—the so-called GLOCs. It is essential that they are reopened. I spoke to Prime Minister Gilani about this when he visited the UK a week or so ago, and I spoke to President Zardari at the conference. I am confident that progress will be made but, frankly, it needs to be made more rapidly than is currently the case.

The right hon. Gentleman asked about the political challenge, and he is right about that. I have said all along that, alongside the military surge, we need a political surge. We are working very hard with the Afghans and the Pakistanis to deliver that. We have made a very clear offer to the Taliban that if they lay down their weapons and join a political process, that process will be open to them. But we have to be prepared for the political process not advancing as far as we would like, and that is why we must ensure that the build-up of the Afghan national security forces goes according to plan so that we can hand over in good order, as I believe we will.

I welcome what the right hon. Gentleman said about Syria and Burma. On President Hollande, let me make this point. President Hollande said something that I think the right hon. Gentleman should perhaps adapt slightly, then repeat. He said:

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

We have never heard the right hon. Gentleman say anything as clear as that before. Let us look at what President Hollande is doing. When he was asked how he would stimulate growth, he said:

“The means cannot be extra public spending, since we want to rein it in”.

The right hon. Gentleman asked about our approach on growth. We agree with the Italian Prime Minister that we need structural reform in Europe. We agree with the French President that we need a more active monetary policy in Europe. We agree with the German Chancellor that deficit reduction is vital in getting interest rates down. The problem is that Europe has not had all three, but we support all three of those things.

Finally, I would just say to the right hon. Gentleman that nobody I can find in Europe, not even the left-wing party in Greece, backs his idea of putting an extra £200 billion of borrowing into the British economy. That is the Labour policy. It would put up interest rates, it would wreck our economy and it would wreck our prospects—which is exactly what Labour did in office.

[Sir Peter Tapsell (Louth and Horncastle) (Con)]

Did anyone at the G8 summit emphasise that the basic cause of the economic and political crisis in Europe was not the Greek debt but the single European currency and its lack of a lender of last resort, which is now a threat to the global stability of the banks? May I put it to the Prime Minister that, until the leaders of the great nations grasp that fact and act upon it, the turmoil in Europe will continue?

--- Later in debate ---

[The Prime Minister]

My right hon. Friend makes an incredibly important point, which is that a single currency requires an active, interventionist central bank behind it. That is something that we have been saying for a very long time, and it is one of the reasons I have always been sceptical about the single currency. There is a growing realisation that, alongside plans to deal with deficits to provide fiscal credibility, there is a need for a more active monetary policy. That is what we have in the UK, with our single currency across our nations, and if Europe is to have a working single currency, it needs that sort of monetary policy too.

[Mr Alistair Darling (Edinburgh South West) (Lab)]

While I welcome the change of rhetoric over the weekend, particularly from the Prime Minister, in recognising that austerity alone will not work—at least, from his point of view, in Europe; he might apply that here, too—will he tell us whether the German position has changed at all? It does not seem to have done so, but until it does, I shall find it hard to believe that the eurozone can come up with anything convincing or credible before the Greek elections on 17 June.

[The Prime Minister]

I have great respect for the right hon. Gentleman, and he raises absolutely the right point. I would say that the German approach is changing, to an extent, because the Germans know that alongside deficit reduction plans, in a single currency, there needs to be greater co-ordination of that single currency. Their concern is that they do not want to take their foot off the deficit reduction until they have more of a political system around the single currency. I understand their concern. This is one of the reasons that I never wanted to join a single currency; I have always believed that a single currency involved a sort of single economic government. The struggle is to try to convince countries in Europe that, alongside deficit reduction, they need a more active monetary policy, a European Central Bank that stands behind the currency, and the structural reforms, such as completing the single market, that we have always argued for.

[Mr John Redwood (Wokingham) (Con)]

I welcome the emphasis on growth. Does the Prime Minister agree that the Bank of England and the banking regulators in the UK need to amend their method of operation to ensure that sufficient money and credit are available to fuel a private sector-led recovery, rather than simply providing more cheap money for the state? Could they not learn from America, which is doing that very well, in order to avoid the problems that Europe is being plunged into by doing it far worse than we are?

[The Prime Minister]

My right hon. Friend makes an important point. When I say “active monetary policy”, I do not simply mean a central bank that engages in quantitative easing, or whatever. We need to ensure that all the monetary institutions of a country, including its banks, are properly capitalised and properly working. Around Europe, there is a lot of work that needs to be done on that.

[Sir Gerald Kaufman (Manchester, Gorton) (Lab)]

With regard to the Prime Minister’s discussion with the President of Pakistan, does he deplore Barack Obama’s offensive discourtesy towards the President, the sovereignty of whose country the United States has violated with deadly effect? Will he confirm that Britain stands shoulder to shoulder with our Commonwealth partner in defying American colonialism?

[The Prime Minister]

I have to say that I would not put it like that. We need to work very closely with our American allies, within our special relationship, to try to deal with the terrorism that has come out of Afghanistan and is still coming out of parts of Pakistan. It is in our national interest to do that, but I always urge all international friends and partners to show patience and understanding with Pakistan because it is the biggest victim of terror of all. It has complex politics, and it needs to be given the space to resolve some of those issues. It also needs to know that its friends, such as Britain, will not leave it after the Afghan conflict is over, and that we are there for long-term partnership, friendship and support.

[Simon Hughes (Bermondsey and Old Southwark) (LD)]

Of course I associate myself and my colleagues with the tributes to our serving forces, particularly in Afghanistan, and to those who have given their lives. On the global economy, will the Prime Minister continue to make it clear that, although we are not in the eurozone and should not wish to join the eurozone, it is in our interests that we support the other countries in Europe that are in it—including, as the Father of the House said, by supporting their structural reform? Does he also agree that an increase in the internal market across Europe is in their interest and ours, and that construction at home is the best way of creating the growth that we need in this country as an immediate priority?

[The Prime Minister]

My right hon. Friend is entirely right. It is in Britain’s interests that the problems in the eurozone are dealt with. We have consistently made a whole series of suggestions about firewalls, about strengthening banks and about consistent and strong contingency plans. The point that I was making at the weekend is that it has become ever more urgent to make those contingency plans because, frankly, it is not in our power to determine whether Greece decides to stay in the eurozone. We have to prepare for every eventuality, however difficult that might be.

[Hywel Williams (Arfon) (PC)]

This morning, the European Parliament passed, by a very large majority, a call for a financial transactions tax. Can the Prime Minister foresee what his stance, and that of other leaders, will be on that matter this evening?

[The Prime Minister]

My view is very simple: I am against a financial transactions tax, for the simple reason that the European Commission did a piece of research into such a tax and found that it would cost hundreds of thousands of jobs. While it might sound as though it would tax the bankers and all the rest of it, it would actually put up the cost of people’s insurance policies and pension policies and drive all that activity offshore. I am not surprised that some other European countries support it, because they see it as a good way of taking a lot of tax out of the UK and spending it in Europe. Well, I am not falling for it.

[Mr William Cash (Stone) (Con)]

There is increasing pressure for political union between certain member states. Whether this is achieved by enhanced co-operation, by separate intergovernmental treaty or by other stealth measures, does my right hon. Friend accept that, irrespective of the European Union Act 2011, such a fundamental change in the relationship between such member states of the European Union and the United Kingdom would necessitate a referendum?

[The Prime Minister]

I do not agree with that position. I think the right position for the UK is to say that we should hold a referendum only if power were to pass from Westminster to Brussels or if we were to join some new treaty or political construction that involved the passing of that power. I agree with my hon. Friend, however, that the single currency clearly has within it the seeds of greater political union, so we have to work out—in this country, in our coalition and in the Conservative party—how to respond to that and how to get the best deal for Britain as the situation develops.

[Mr Bob Ainsworth (Coventry North East) (Lab)]

The Prime Minister talks about the continued importance of NATO and about some of the things that have been agreed, but the agreed changes are largely peripheral and the need for reform is profound. Is there not a danger that the understandable focus on the economic crisis is sucking the life out of the need for reform in NATO? Will he focus on that? Notwithstanding the understandable needs of the economy, will the Prime Minister make sure that the change programme that is so badly needed to get decent interoperability within NATO does not lose its momentum?

[The Prime Minister]

The right hon. Gentleman speaks with great knowledge of this subject. I would be a little more optimistic: one NATO reform, which I know he would welcome, aimed to cut the bureaucratic and headquarters posts around Europe. To be fair to Secretary-General Rasmussen, he has done an excellent job in delivering that. We have also delivered the ballistic missile defence in interim capability, which is another important step forward for NATO. Where I am perhaps more optimistic than the right hon. Gentleman is that I think the reality of the situation will drive us towards reform. Everyone faces tough budgets, and the fact that America is now providing almost three quarters of NATO’s funding and assets is unsustainable, so other countries are, frankly, going to have to step up to the plate, look at their arrangements and co-operate more, as we are with the French, to deliver more of the teeth and less of the tail.

[Nicholas Soames (Mid Sussex) (Con)]

May I warmly endorse the Prime Minister’s view that NATO is vital to our security and congratulate him on the very positive role he played at the summit as the leader of one of NATO’s most important countries? Does he agree that the Secretary-General’s programme for smart defence is key to the future reform of NATO and that the right hon. Member for Coventry North East (Mr Ainsworth) spoke a great deal of sense?

[The Prime Minister]

I thank my right hon. Friend for his remarks. The truth is that there is duplicated defence capacity all over Europe, much of which is not deployable. We need all countries to undergo the difficult and painful things we have done in strategic defence reviews to work out what weapons and systems are needed for the conflicts of the future, recognising that NATO is less likely to fight land invasions and much more likely to have to deal with failed states and terrorism, so the needed capacities are different. Even that will not be enough, as we then need a lot more co-operation—particularly, I think, between the leading members of NATO, which is why we are working so closely with the French—so that we can deliver complementary capabilities and get more done as a result.

[Mr George Mudie (Leeds East) (Lab)]

With the aim of achieving growth, the IMF specifically recommended yesterday that UK banks slow their acquisition of capital buffers, thereby making more money available to British businesses and small businesses. Do the Government agree with that recommendation, and will they work with the Bank of England to implement it as soon as possible?

[The Prime Minister]

The hon. Gentleman raises an important point. This is a difficult issue to get right. We are rightly discussing two problems: the need for growth, and the need for financial stability and ensuring we are safe, with the headwinds of a potential eurozone storm approaching. I think the best approach is to work hand in glove with the Bank of England and the Financial Services Authority to get that balance right. That is what the Government will do.

[Richard Ottaway (Croydon South) (Con)]

I congratulate the Prime Minister on his stamina, as I calculate that by this evening he will have done three summits in two continents in five days. I reiterate the points made by my right hon. Friend the Member for Mid Sussex (Nicholas Soames) and the right hon. Member for Coventry North East (Mr Ainsworth). We have to impress on NATO members that the conclusion of the Afghanistan campaign is no justification for cutting defence budgets. It is essential to have a full-blooded review of NATO strategy, with a full-blooded commitment from all its members.

[The Prime Minister]

I thank my hon. Friend for his remarks about my summitry. By the end of tonight, that will be enough summits for quite some time, although the G20 will soon catch up on us. What he says about NATO is right. We need reviews from all NATO countries, which need to go through their budgets and work out what is necessary for national defence. We need to ask what more we can all do to make sure that NATO has the capacities it needs for the future.

[Mr Nigel Dodds (Belfast North) (DUP)]

I endorse what the Prime Minister said about the importance of NATO to our national security and the need to spend more on the technology of tomorrow. Cyber-terrorism poses an ever-greater threat. Will the Prime Minister assure us that within NATO intense focus will be devoted and resources given to that big and growing problem across the world?

[The Prime Minister]

One of the things the UK did in the strategic defence review was to invest some of the savings made—from memory, I think it was £900 million—in a cyber-defence programme. That is being co-ordinated with GCHQ, but also involves the private sector. We hope to work with other NATO members on that capability to make sure that we share best experience and endeavours, and that should lead to savings for us and for others.

[Mr Peter Bone (Wellingborough) (Con)]

The euro is as dead as Monty Python’s parrot: it is no more, it has ceased to be, it has expired. So why do the euro elite continue to claim that it is alive and well? Is it not essential that Europe implements an orderly break-up of the eurozone before the markets force an economic tsunami?

[The Prime Minister]

Like my hon. Friend, I have always been a genuine euro-sceptic—sceptical about the euro—which is why I did not want to join it. We have to recognise, however, what is in this country’s interest, which is for the eurozone to sort out its issues and difficulties. I believe that will involve greater fiscal transfers and it must involve eurobonds over time. As I have said, it involves a more active monetary policy in Europe. We should encourage our European partners to go down this road to make sure that their system works properly. There are real dangers from disorganised exits from the euro. It is not just that countries would devalue, which would have an impact on us, as we have to think about the impact on financial institutions and banks around Europe, including on British banks. It is very important that the eurozone takes the necessary steps to put in place the contingency plans to keep it safe.

[Mr Dennis Skinner (Bolsover) (Lab)]

Now that the Prime Minister is lecturing Greece about the need for growth and that we need a little bit in Spain and the eurozone, so he says, for the sake of clarity can we get to the bottom of growth here? Will he repeat these words after me: “I’m going to drop the austerity plan and go for growth in Britain”? Now’s your chance.

[The Prime Minister]

I am afraid that I do not agree with the hon. Gentleman. I deeply regret that my last encounter with him was perhaps a bit sharper than it should have been, and I hope he will accept my apology. He is a tremendous ornament to this House, and that will always remain the case. I do not agree with him because I think a deficit reduction plan is necessary to deliver the low interest rates we need, which are essential for growth. I make the point again that when this Government came to power, our interest rates were the same as those in Spain. Today, ours are less than 2% and Spain’s are over 6%. One reason for that is that we have a credible fiscal policy.

[Andrew Selous (South West Bedfordshire) (Con)]

Will my right hon. Friend give the House an absolute cast-iron assurance that while he is Prime Minister this country will never, ever join the euro—unlike the Leader of the Opposition, who seems very open to the idea?

[The Prime Minister]

I am very happy to give that pledge. I note that the Leader of the Opposition said that whether we joined the euro would depend on how long he was Prime Minister; I am not sure which prospect is the more terrifying.

[Alison McGovern (Wirral South) (Lab)]

Young people in Merseyside see their friends suffering from a lack of opportunities, and they feel distressed when they see huge unemployment rates among young people in Greece and Spain. Will the Prime Minister say specifically what discussions he had with G8 colleagues about infrastructure development as part of a global plan for growth?

[The Prime Minister]

We did discuss the issue of infrastructure development, because I think that it can be part of what needs to be done. The rise of unemployment is tragic in any country, but the figures in Greece, Spain and elsewhere in southern Europe are eye-watering: 50% of young people are unable to find work.

As I have said, I think that the elements of the plan that we need are the fiscal credibility that provides low interest rates and the active monetary policy that supports demand in the economy, as it has in the UK, but combined with structural reforms. There is a need for proper structural reforms in Greece and other countries so that they can have competitive economies. The extra element is using the credibility that we have earned, and the strength of the Government’s balance sheet, to try to deliver innovative finance to infrastructure and credit. That is obviously an option that is open in Europe as well, and I think that it is what President Hollande is referring to when he talks about project bonds. Those are the elements of a growth plan. We have them all in the UK, and we need them in Europe as well.

[Mr Julian Brazier (Canterbury) (Con)]

Does my right hon. Friend agree that when we look at the scale, and the time scale, of the burden that fell on what was then West Germany at the time of German reunification, we have a sense of the awesome challenge that would face any German Chancellor trying to achieve fiscal union in Europe?

[The Prime Minister]

Yes, I think that my hon. Friend is entirely right. Some people imply—it was implied in the question from the former Chancellor, the right hon. Member for Edinburgh South West (Mr Darling)—that German stubbornness is unreasonable. It is understandable. Obviously, for the success of the eurozone we need everyone to adopt approaches such as those I have described in terms of monetary policy, eurobonds and the rest of it, but it is important to understand people’s motivations and difficulties, because they are what lie behind the current impasse.

[Chris Bryant (Rhondda) (Lab)]

It is good that the Russians shared in the motion on Syria, but even if we leave aside the rigged elections in the Russian Federation, there are still major human rights abuses in Russia. For instance, Mikhail Khodorkovsky’s second trial has been universally condemned by every international organisation in the world and, indeed, by many organisations in Russia. He tried to secure an appeal, but it was turned down only last week by Judge Alexander Voronov, who is not an ordinary judge but a military judge in the military chamber of the Supreme Court. When the decision was handed down that there could be no appeal, it was done on the Russian armed forces website. Does that not show that Russia has a great distance to go before it can really embrace being part of the humanity of nations?

--- Later in debate ---

[The Prime Minister]

We discuss the importance of freedom, human rights and democracy regularly with Russian colleagues. When I visited Russia, I met civil society organisations to discuss precisely those issues. However, I think that it is very worthwhile to have Russia in the G8. When we are discussing issues such as Iran and Syria, in which Russia has an interest—and, frankly, we want it to join in the efforts we are pursuing—I think that it is helpful to have the Russians there.

[Joseph Johnson (Orpington) (Con)]

In the absence of progress towards a global trade deal through the Doha round, an EU-US deal could be a decent second-best if it meaningfully reduced tariff and non-tariff barriers to trade. Can the Prime Minister give an indication of a plausible time frame for the conclusion of such a deal, and perhaps also an indication of how much the UK economy in particular might benefit from it?

[The Prime Minister]

I think that there is still something salvageable from the Doha round—all the elements of trade facilitation, such as helping to reduce customs times and charges, rather than the bigger Doha package—and I think that we should pursue that. We had a conversation at the end of the G8 in which we agreed to go away and look at our “issues paper” for the G20, and to establish whether there was a small enough distance to be closed between the EU and the US to make a deal worthwhile. I am very hopeful. Britain is one of the most open trading nations. There are real concerns on both sides—obviously there is a French position on agriculture, and an American position on many services and other issues—but I think that we will have a good look at this at the G20 and see whether we can fast-track it.

[Mr Denis MacShane (Rotherham) (Lab)]

Is the Prime Minister aware that Greece spends 50% more on defence than ourselves, France or Turkey, and is the biggest arms importer in Europe? Is he aware that the Greek shipping industry, which accounts for 7% of Greek GDP, and the Greek Orthodox Church, which is the biggest land and property owner, do not pay a penny in tax? When he talks to the Greek Prime Minister, will he ask him to scale down defence spending and get the oligarchs and the Orthodox Church to pay a little bit to solve the Greek crisis?

[The Prime Minister]

The right hon. Gentleman makes a good point. However much one can look at the Greek situation and feel for the people who are suffering as a result of unemployment and living standards, there is a crying need for genuine reform in Greece, and for more straightforward and honest politics when it comes to dealing with those problems. That means making sure that people do pay their taxes, and making sure that industries are competitive.

The issue of defence spending is obviously more complex because of the relationship between Greece and Turkey, but as we are now both NATO members and Turkey is an aspirant EU nation, there should be an opportunity to decrease Greek spending on national defence, while of course encouraging it to be a good NATO member at the same time.

[Matthew Hancock (West Suffolk) (Con)]

At the G8 summit, did any of the leaders advance the argument that dealing with the deficit and supporting growth were alternatives, or did they argue that it was necessary to bring about growth through monetary policy, by supporting the banks and by getting trade going? Did anyone advance the argument that it was necessary to borrow one’s way out of debt?

[The Prime Minister]

My hon. Friend makes a very important point. Absolutely no one suggested that dealing with deficits and securing growth were alternatives. They are complementary: we need both. That is the view of everyone around the G8 table. There is only group of people who have their heads in the sand and are complete deficit deniers, and they are the people who gave us the deficit in the first place.

[Jeremy Corbyn (Islington North) (Lab)]

The Prime Minister rightly drew attention to the level of youth unemployment in Greece, which is more than 50%. More than a quarter of adults are unemployed, and the economy is set to contract by a further 6% in the current financial year. The Prime Minister has preached austerity in this country and all around the world. That is exactly what has been done in Greece, and that is exactly what the result has been. Is the Prime Minister prepared to put pressure on the European Central Bank, in so far as he can, to stop the austerity oppression in Greece and start supporting the needs of ordinary people who have worked very hard and do not deserve this misery?

[The Prime Minister]

This is where I part company with the hon. Gentleman. In this country, we have consistently said “You need to have deficit reduction, which delivers low interest rates and enables your central bank to pursue an active and expansionary monetary policy”—which is what we have had in this country—“and at the same time you need the structural reforms to ensure that your businesses are competitive and can take on more people and grow.” That is what we are seeing in Britain, with 600,000 more private sector jobs. It is a world away from what is happening in Greece or in many other parts of the eurozone, which do not have the monetary policy accompanying the fiscal policy and which have not undertaken the structural reforms we are undertaking.

[Alec Shelbrooke (Elmet and Rothwell) (Con)]

I am sure that my right hon. Friend will agree that the biggest threat to our country at present is indeed the crisis in the eurozone, but almost parallel with that is the possible pending crisis in the middle east. Given that a very important conference begins today in Baghdad, did my right hon. Friend manage to find time at the weekend to emphasise to the Russian and Chinese leaders the importance of their role in trying to ensure a peaceful outcome of the Iranian situation?

[The Prime Minister]

My hon. Friend is right to raise that issue. A good portion of the G8 was spent discussing the situation in Iran, and specifically discussing the talks that are under way in Baghdad today. It was heartening that the Russians signed up to a pretty tough text on Iran, and I think that the path is very clear. Europe has rightly adopted the oil sanctions, and the pressure is beginning to tell on the Iranian economy. This is the moment at which to maximise the pressure, to encourage other countries around the world to join in with the sanctions, and to say to the Iranians “There is a different pathway. You can have civil nuclear power; you can have a more decent relationship with other countries of the world; but you must give up the ambition of enriching uranium to such an extent that it could deliver a nuclear weapon to you.”

[Derek Twigg (Halton) (Lab)]

Whatever the structural deficiencies and other problems that exist in Greece and have existed there for a number of years, this problem was not caused by that; it was caused by the banking and economic crisis in the world, and the way in which the eurozone has dealt with it. The suffering and austerity in Greece is on a completely different scale from what we have even envisaged in this country, and it is untenable for it to continue. Will the Prime Minister go back and ask the euro partners—not least, of course, the Germans—to think again about what we can do to bring about a different plan there? I remind him that Greece is a very proud nation. It is a very important ally of ours, it stood by us alone in 1941 against the Nazis, and we should do what we can to help it.

[The Prime Minister]

Of course I agree that Greece is an important ally. Relations between Britain and Greece are very strong, and the historical analogy the hon. Gentleman draws is absolutely right. I do not agree, however, that the problems in Greece are caused only by the euro or by the banking crisis. There are deep and profound problems in the Greek economy that need to be dealt with. There must be the right combination: there need to be deficit reduction plans; there needs to be an active monetary policy; there need to be reforms to the eurozone; and there need to be structural reforms. In the end, however, it will be for the Greek people to decide whether they want to do these things inside the eurozone our outside the eurozone. Clearly, a disorderly exit would be very bad for Britain, and we should do everything we can to avoid that, but we need to plan for every eventuality and have proper contingencies in place.

[Mr John Baron (Basildon and Billericay) (Con)]

In the absence of much-needed supply-side reforms in the eurozone, I suggest a day of reckoning is fast approaching. Given that since the second world war there have been 80-plus cases of countries leaving a currency bloc and the vast majority of them have benefited from that, does the Prime Minister think that we are fast approaching a time when we should stop talking about the need to save the euro, because it can create uncertainty and hit confidence and investment in this country?

[The Prime Minister]

My hon. Friend makes an important point, but I am not entirely sure I agree. There are, of course, examples of countries that have left currency pegs, and suffered in the short term but then recovered. There have also been countries that split their currency in two; Czechoslovakia managed that process well. There is a substantial difference, however, between such cases and situations where there is a potential breakaway from a currency zone with a single currency. That is a different situation because the banks are so intertwined. That is why we must think very carefully about the contingency plans for such situations.

[Jim McGovern (Dundee West) (Lab)]

The Prime Minister paid tribute to the troops who have come home from Afghanistan. Recently, my wife, Norma, and I welcomed a Black Watch battalion home to Dundee. Can the Prime Minister assure me, current serving personnel in the Black Watch, Black Watch veterans, my family and my constituents that on his watch there will always be a Black Watch?

[The Prime Minister]

I very much want us to keep the regimental structure; that is very important. At the same time, however, we need to deliver this big change in our armed forces—which, actually, will deliver a larger Army, but also a better balance between a professional Army and a territorial Army. We are looking at exactly how that can be done, while saving the important regiments about which people rightly feel so strongly.

[Mary Macleod (Brentford and Isleworth) (Con)]

At the G8 summit, my right hon. Friend the Prime Minister discussed development, with the aim of lifting 50 million people out of poverty in the next 10 years. May I therefore urge him to do even more in respect of microfinance as a way of creating sustainable economies over the long term, and to use charities such as the MicroLoan Foundation in Chiswick, which gets a 99% return on the money it gives to women in Africa to create businesses for themselves and their families?

[The Prime Minister]

My hon. Friend makes an important point. We are, of course, committed to aid and development, and to expanding the new alliance for food security and nutrition programme that Barack Obama launched. Microfinance is important because it not only helps to grow small businesses, but it empowers women, which can make an enormous difference to the success of development.

[Keith Vaz (Leicester East) (Lab)]

Was there any discussion about the situation in Yemen? The Prime Minister will know that on Monday a bomb exploded in the middle of the unity day celebrations, killing 96, and this morning aid agencies have said that half the population is going to starve to death. I appreciate what the Prime Minister and his Government—and successive Governments—have done. However, while the Prime Minister has made Burma a priority for his chairmanship of the G8—I also acknowledge your role, Mr Speaker, in championing the cause of Burma—can he not also find a little space for Yemen, because a stable Yemen is in our interests? If we do not support that country, al-Qaeda will take it over and it will bleed to death.

[The Prime Minister]

The right hon. Gentleman knows that I absolutely agree with him on this. At the G8 summit, I talked about the next G8 and said it was very important that we address the security and development priorities of the future. I think both Yemen and Somalia fall squarely into that bracket. The recent hideous bomb attack and loss of life in Yemen was extremely distressing. We must focus a huge amount of effort on the country. A development effort is going in: I think the Department for International Development will today announce an investment of £26 million in that country. We must also give an enormous amount of national security assistance to the country, and I discussed that in my bilateral with President Obama.

[Andrew Stephenson (Pendle) (Con)]

May I echo what the Prime Minister said about our brave servicemen and women, who continue to strive to bring peace and stability to Afghanistan? Sadly, agreement was not reached on reopening the supply routes through Pakistan. Will the Prime Minister comment further on that, and on the role of Pakistan as a key ally in our efforts to leave Afghanistan on a stable footing at the end of 2014?

[The Prime Minister]

That is a key point. We need to ensure we have northern routes as well, of course, and I had a good meeting with the President of Azerbaijan to discuss that issue. On Pakistan, Members are absolutely entitled to feel frustrated. We are enormous aid donors to Pakistan, and we have a very strong relationship with the country. It is frustrating that the lines of control are still closed, but there are ongoing discussions and I am confident they will be reopened. We have to show an understanding about how this country has suffered from terrorism, about the complexities of its politics and about the need to show real respect for its sovereignty and its democracy. The message we must give to both Afghanistan and Pakistan is that long after this war is over, we will be there supporting both of them as strong independent countries, diplomatically, politically, through trade, through aid—through all the means we have—and we will not desert them.

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

In a recent visit to Nigeria, I saw at first hand the great opportunity for agri-investment in that amazing country. However, the all-party group that I chair has heard a lot from British businesses about the logistical challenges and security concerns of investment in Nigeria. While the new alliance for food security and nutrition is a good step, what support will the Prime Minister pledge to British companies looking to invest there, so we get the win-win of both growth in British business and food and jobs for Nigerians?

[The Prime Minister]

When I went to Nigeria and met the UK Trade & Investment team in Lagos, I was hugely impressed by its work and its dedication, and also by the incredible links between British Nigerians and Nigerian British, as it were, working between the two countries. We work very closely with the Nigerian Government on security, because there are considerable security challenges, particularly in the north of the country. Security training and counter-terrorism co-operation between the UK and Nigeria can help produce major dividends both for that country and for trade and investment.

[Alok Sharma (Reading West) (Con)]

Given that increasing exports to emerging economies needs to be a key part of the growth strategy of many of the G8 nations, will the Prime Minister update us on any discussions he has had with other European leaders on progress on the pending free trade agreement between the EU and India?

[The Prime Minister]

We had a number of discussions about the free trade agreements. There is a series of such agreements: the Indian one; the Canadian one; the chance of getting one going with Japan. My view is that all of them are good news. The Korean one has been a success, and we need to drive them all forward—and we are certainly in the vanguard of doing that.

[Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op)]

May I echo the comments of those colleagues who expressed concern at the scale of the cuts and the retrenchment being forced on Greece—the ordinary people of Greece, not the Greek Government? While I agree with the Prime Minister that there need to be structural reforms and the changes he has suggested, would it not be better to have a bit more flexibility—a bit more European solidarity—rather than end up forcing Greece into a situation that leads not only to the collapse of that country, but immense consequences for the eurozone and the entire world economy?

[The Prime Minister]

Obviously, we are not a participant in the eurozone bail-out of Greece. We are supporting Greece through the IMF, however. The hon. Gentleman must consider this point: other European and eurozone countries, some of which are not particularly rich themselves, have had a series of agreements with Greece about what needs to be done and what money will be put in, and effectively he is asking them to go back repeatedly to their own Parliaments and say, “Well, I promised I wouldn’t ask for any more for Greece, but here I am again asking for more.” That is very challenging for them. As I have said, in the end it will be for the Greek people to decide, in their election, whether they want to stay in the euro and keep to the undertakings they have given, or whether they want to choose a different path. We in this country must be clear that we should support all and any contingency plans to make sure that either scenario can be safely delivered.

[Mr Robin Walker (Worcester) (Con)]

The Prime Minister cited in his statement the extraordinary statistic that the EU and the US together make up more than half the world’s gross domestic product. Does he accept that this may well be the last generation for whom that is the case, and that it is therefore more vital than ever that we reach out further and faster into developing markets to support our exporters and build on our strengths as a country?

[The Prime Minister]

My hon. Friend is right that the share of world trade and the share of the world economy taken by the EU and America together is likely to decline as that of China and India rise, but I was always taught in business that going back to one’s best and biggest customer to get that extra deal is often a very good strategy, so we should be thinking exactly about that in terms of EU-US trade.

[Hugh Bayley (York Central) (Lab)]

At a time when defence budgets are constrained right the way across the alliance, is it not important for NATO itself to demonstrate, in the same way as its member states, that every pound it spends is well spent? Will the UK therefore support proposals being considered by the NATO secretariat to ensure that the external audit service for NATO is entirely independent of NATO, that accounts are published in a timely fashion—say, within six months of the year- end—and that they are available for parliamentarians in this and other Parliaments in NATO states to scrutinise, in the same way that we scrutinise our own defence expenditures?

[The Prime Minister]

The hon. Gentleman, who has great knowledge of these things, makes a series of sensible suggestions and we should look carefully at them. Let me again commend Secretary-General Rasmussen for what he has done in reforming the huge number of command posts and headquarters posts in NATO. I suspect that there is more to be done on that front, as well.

[Julian Smith (Skipton and Ripon) (Con)]

Currently, Britain has only some 3% of the European market in services. Can the Prime Minister confirm just how important completing the services market is for British services?

[The Prime Minister]

On completing the single markets in digital, in services and in energy, each of them can add, I believe, more than a percentage point on European GDP. The services market is particularly important because it is an area that Britain excels at—not just financial services but everything, including construction and architecture. On opening up services in other countries, a number of countries are currently in breach of their undertakings, so the pressure for this, particularly in countries such as Germany, should be very great.

[Geraint Davies (Swansea West) (Lab/Co-op)]

We all know the expression, “Give a man a fish and he can eat for a day; give him a rod and he can eat for life.” Therefore, why is some of the money being used to pay down the debt in Greece and not instead being invested in solar forests across Greece so that they can provide Europe with energy; being invested in rail links, so that people can travel between Greece and other European countries and thereby boost tourism; and being invested in universal broadband, so that we can connect Greece to the world? We have a politically acceptable and economically sustainable solution, instead of putting half a fish on the table, leaving the Greeks hungry and angry by lunch time.

[The Prime Minister]

The Greeks have had a very special deal—an enormous private sector haircut on their debt, through which creditors have been asked to take a share of the burden. The money that Greece has received in the last decade from the European Union could have gone into many of the projects that the hon. Gentleman points out. Part of the problem in parts of the eurozone is that the early years of the euro saw wage rates and unit costs of labour rise, rather than their being fundamental changes to make these countries more competitive.

[Glyn Davies (Montgomeryshire) (Con)]

It seems that there is a strong possibility that Greece will be forced out of the eurozone, and we are obviously concerned about the impact on the economy that a disorderly exit may have. Does my right hon. Friend agree that we need to hold discussions with our European partners and develop contingency plans to ensure that such an exit has the minimum possible impact on the United Kingdom?

[The Prime Minister]

My hon. Friend is entirely right. Obviously, this is not something we want to see happen, and it is in our interests that the eurozone deals with its issues, strengthens its firewalls and strengthens its banks, and that we start to see the high interest rates in parts of Europe come down. But it would be irresponsible not to prepare proper contingency plans, and that is what the Treasury and others have been doing. As I say, whether Greece stays in the euro or not is not within our power, and we must prepare for all eventualities; but obviously, a disorganised exit would cause real difficulties.

[Dan Jarvis (Barnsley Central) (Lab)]

Our country has invested a lot in Afghanistan—a lot of sacrifice and a lot of resource. So, along with many others, I am increasingly concerned at the lack of progress in the critical issues of politics and governance in Afghanistan, which, by nearly all accounts, are getting worse, not better. Will the Prime Minister therefore pledge to re-energise this process in order to give Afghanistan the best chance of surviving as an entity post-2014, ensuring that our efforts and sacrifice are not wasted?

[The Prime Minister]

I respect the hon. Gentleman’s views, not least because he served in the military and knows about what he speaks. Regarding the political surge in Afghanistan, he is perhaps being a little too pessimistic. In Helmand province, the area for which we have been responsible, we have seen the excellent Governor Mangal make some real steps forward in governance. There are district governors in almost all the province now, and we have seen a huge amount of progress in wheat seed distribution, building schools and hospitals and providing basic levels of service. But clearly we need to do more, and what happens politically and in terms of reconciliation will determine the nature of the outcome we achieve in Afghanistan.

[Iain Stewart (Milton Keynes South) (Con)]

I welcome the declaration at the NATO summit on the interim ballistic missile defence system. Russia, however, remains hostile to the scheme. Has progress been made in persuading Russia that the scheme’s primary point is to protect Europe from ballistic missile threats from rogue nations, not from Russia?

[The Prime Minister]

Obviously, it is still a difficult discussion between NATO and Russia, but I think there is a level of understanding that the point of having a ballistic missile defence shield is to protect Europe from potential threats, including, for instance, Iran. It is important to remember that this is not instead of nuclear deterrence—it sits along side nuclear deterrence, which remains a key part of our defence posture.

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

The International Monetary Fund confirms in its article IV report published yesterday—if we needed it confirmed—that plan A is not delivering growth. It has also made a number of suggestions and recommendations, many of which have been discussed in the Chamber today, and some of them will be implemented in the coming months. The report goes on to suggest—recommend, even—a plan B to boost growth and temporarily cut taxes. Is the Prime Minister listening?

[The Prime Minister]

I listen very carefully to what the IMF says, and to me, two things stand out. First, it says that reducing the high structural deficit over the medium term remains essential and that the UK has made substantial progress towards achieving a more sustainable budgetary position—alongside saying that the situation we inherited made the IMF shiver. Secondly, and importantly, it forecasts that the UK will grow faster this year than France, Germany or the eurozone, so it is predicting that things will improve, not get worse.

[Bob Blackman (Harrow East) (Con)]

As our brave troops come home from Afghanistan, one of the key issues is the long-term sustainability of the Afghan economy. In the past, its biggest export has been the poppy crop, which has fuelled the illegal drugs trade worldwide. However, that self same product could be used to alleviate medical suffering worldwide. What consideration has been given to purchasing the poppy crop, so that we can use it for beneficial medical aims and sustain the Afghan economy as well?

[The Prime Minister]

I have looked at this issue in some detail. The key thing is that if proper governance, proper rule of law and proper transport networks can be delivered in a country, then what might be done with its ability to grow poppy might be considered; that is what happened in Turkey. But I have a feeling that if a poppy-purchasing project were suddenly introduced now, rather like in “Blue Peter”, you would buy one and they would produce another one they had made earlier, so I do not think it would work. But I do believe that the Afghan economy can develop, and that is one of the reasons that we are spending a serious amount of money not just on supporting the Afghan national security forces but on economic development in Afghanistan, and clearly, that will be key to its future.

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

Recently, I had a meeting with Afghan Sikhs in my constituency. Under the Taliban, they were forced to wear yellow ribbons and were prohibited from cremating their deceased loved ones. They have raised with me grave concerns about their freedom in the future and women’s freedom in Afghanistan. Can the Prime Minister update the House on any discussions that took place in Chicago on minority rights and women’s rights, so that we do not see a rolling back of social progress?

[The Prime Minister]

The hon. Lady raises a very important point. I had a good meeting with President Karzai in Chicago, and one of the points I made to him was that the quality of Afghan democracy, Afghan rights and Afghan justice will be absolutely key in delivering success. The Afghan constitution does guarantee some basic rights. That is why we say that, of course, if the Taliban put down their arms and stop fighting, they can discuss a future political role, rather as IRA-Sinn Fein have done in Northern Ireland, but they have to accept the basic tenets of the Afghan constitution.

[Amber Rudd (Hastings and Rye) (Con)]

I am immensely proud of the commitment to international aid made by this country, but I am concerned about the levels of some of the other members of the G8. May I urge the Prime Minister to use next year’s presidency to remind some of the other members of their Gleneagles commitment?

[The Prime Minister]

I would be delighted to do that. One of the strengths of the G8 is that it produces this accountability report, and I will make sure that a copy is put in the Library of the House of Commons because it is very compelling. It really holds countries to the promises they made about aid, about spending and about the different bits of that spending. People can see it there, in black and white: who has met their promises and who has not. We will continue to do that next year.

[Mr William Bain (Glasgow North East) (Lab)]

There are nearly 25 million people unemployed across the EU at the moment, and economic demand is continuing to fall in the eurozone and in this country, whereas in America it is rising this year. Will the Prime Minister therefore follow the lead of the US and Japanese Governments, and the advice of the IMF yesterday, and bring forward much-needed capital spending to boost infrastructure and get the construction sector off its knees?

[The Prime Minister]

We have said that we want to use the hard-won credibility we have, the low interest rates we have and the strong national balance sheet we have to encourage that private sector investment. We have made a series of important announcements about housing, including backing mortgages of up to 90% loan to value to try to get the housing market working again, because the housing market is not functioning. I would just say that if we look at America’s deficit reduction plans, we find that it actually has plans to reduce its deficit faster than we do.

[Gavin Williamson (South Staffordshire) (Con)]

Does my right hon. Friend agree that the G8 decision to create the capital markets access initiative will help Arab spring countries to tap into international capital markets, bringing them both stability and prosperity?

[The Prime Minister]

My hon. Friend makes an important point. I think it is still a net bonus to the world that there has been the Arab spring, and we need the wealthy countries of the world and the European Union to get behind it. One of the problems we face is that those north African and Arab countries that have set themselves free were told in the past that they had experienced a free enterprise economy, whereas in fact they had really been having a sort of crony capitalism economy. We need to work very hard with them to encourage them to take a path that will make sure that their economies grow for the future.

[Mark Durkan (Foyle) (SDLP)]

I welcome the Prime Minister’s alert on the levels of aid going from the richest to the poorest countries. In following through on the commitment to sustainable hunger reduction, will he promote more support for smallholder farmers, who number more than half the world’s 1 billion hungry people, so that they and their families can grow and eat more and better food, can trade produce and can employ others, thus helping communities to thrive?

[The Prime Minister]

The hon. Gentleman makes an important point; part of the presentation given to the G8 by the New Alliance for Food Security and Nutrition was that through the proper use of fertilisers and of things such as exchanges, we can actually make sure that smaller farmers become more sustainable, grow their yields and can not only feed their families, but build a small business.

[Mr Speaker]

Last, but not least, we must hear from the voice of West Worcestershire, Harriett Baldwin.

[Harriett Baldwin (West Worcestershire) (Con)]

I was so pleased to hear the Prime Minister announce a day for discussing global hunger during the Olympics. Does he agree that the agenda should cover not just food security and food production, but the hidden crisis of malnutrition, which literally stunts the growth of so many children around the world?

[The Prime Minister]

My hon. Friend is absolutely right. It just seems to me that while we have the eyes of the world on Britain for the Olympics—and many African leaders will be coming to support their Olympic teams—we have a good opportunity to bring people together to say, “Here we have a great initiative in the New Alliance for Food Security and Nutrition. Let’s take it to the next level. Let’s encourage more countries to join. Let’s make sure that we lift more people out of hunger and out of poverty.” But the point she makes about nutrition is absolutely crucial for the future of the planet.

[Mr Speaker]

I thank the Prime Minister and colleagues.