Committee on Standards in Public Life

Lord Cameron of Chipping Norton Excerpts

Tuesday 22nd November 2011 Written Statements

[The Prime Minister (Mr David Cameron)]

The 13th report of the Committee on Standards in Public Life has been published by the Committee today. I have laid the report before the House and copies have been placed in the Libraries of both Houses.

Consolidated Guidance on Detainees (Update)

Lord Cameron of Chipping Norton Excerpts

Thursday 10th November 2011 Written Statements

[The Prime Minister (Mr David Cameron)]

The Government published the “Consolidated Guidance to Intelligence Officers and Service Personnel on the Detention and Interviewing of Detainees Overseas, and on the Passing and Receipt of Intelligence Relating to Detainees” on 6 July 2010. The guidance was subsequently made the subject of two linked legal challenges; one brought by the Equality and Human Rights Commission, and the other brought by public interest lawyers on behalf of Mr Al-Bazzouni. Judgment in these two linked cases was handed down by the High Court on Monday 3 October. The Court dismissed the challenge brought by the Equality and Human Rights Commission, accepting the Government’s position that there was no material difference between “real risk” and “serious risk” as the threshold at which officers may proceed or must refer cases for more senior consideration, and that it was legitimate for the guidance to use the term “serious risk”. As a judicial endorsement of Government policy, this was an extremely positive outcome.

The Court, however, found in favour of Mr Al-Bazzouni on his challenge regarding the lawfulness of the exception in the annex to the guidance which states that the following could constitute cruel, inhuman or degrading treatment or punishment (CIDT):

“methods of obscuring vision or hooding (except where these do not pose a risk to the detainee’s physical or mental health and is necessary for security reasons during arrest or transit)”.

The Court considered that although the exception could conceivably operate lawfully (so that UK officers could legitimately proceed where a detainee had been hooded in accordance with the conditions set out in the exception), it was unworkable to expect officers on the ground to judge whether the detainees held by foreign liaison services came within the exception, and that the annex should therefore be amended to omit hooding from the ambit of the exception. The relevant section of the guidance has therefore been slightly reworked to reflect this finding. The revised version of the guidance has been placed in the Libraries of both Houses.

To be clear, the Government stand firmly against torture and cruel, inhuman and degrading treatment or punishment. We do not condone it, nor do we ask others to do it on our behalf. Officers whose actions are consistent with the guidance should have confidence that they will not risk personal liability.

G20

Lord Cameron of Chipping Norton Excerpts

Monday 7th November 2011 Commons Chamber

[The Prime Minister (Mr David Cameron)]

With permission, Mr Speaker, I would like to make a statement on last week’s G20 summit. There were three key aspects to the summit. First, agreement on an action plan for growth and jobs, with specific countries agreeing to do specific things in order to maximise overall growth in the world economy. Secondly, the G20 continued with its work to identify and remove some of the key obstacles to growth, including imbalances between surplus and deficit countries, to stop the slide to protectionism, to improve global governance, and to protect the world’s poorest from the current economic problems. Thirdly, there was, of course, the main issue of instability in the eurozone. Let me take each in turn.

First, the action plan for growth and jobs. This includes many of the things that Britain is already doing, from fiscal consolidation and monetary activism to removing the barriers in the way of business and job creation. The G20 recognised yet again the importance of implementing

“clear, credible and specific measures to achieve fiscal consolidation.”

It also clearly identified a group of countries that have the space to borrow for additional discretionary measures. I have to tell any Members of the House who would like to see the UK borrow more that no one was proposing that the UK should be in that group of countries. We are determined to deal with our debts, not to leave them to our children and grandchildren. The need to press on with our plan for fiscal consolidation has now been recognised by the G20, as well as by the International Monetary Fund and the OECD.

Secondly, obstacles to growth. The imbalances that did so much damage in the run-up to 2008 are growing again. This matters, because if we are to maximise global growth and avoid some of the speculative bubbles of the past, countries with a trade surplus need to increase domestic demand and ensure that they keep their markets open, while those with a trade deficit have to undertake structural reforms to improve competitiveness. There was some real progress. For instance, Russia is making changes to its foreign exchange regime, and China agreed to increase its exchange rate flexibility. Both of those are reflected in the communiqué, but more needs to be done.

The greatest mistake that the global economy could make is to enter into a slide towards protectionism. The World Trade Organisation report sets out all the protectionist measures that have been taken in G20 countries over the last year, and they are a cause for concern. So the G20 reaffirmed its pledge not to take protectionist actions, committed again to roll back any new protectionist measures that might have arisen, and reaffirmed its determination to refrain from competitive devaluation of currencies. We also welcomed the fact that Russia, the last G20 country outside the World Trade Organisation, is now set to become a member of the WTO by the end of the year.

On Doha, I have said it is time to look at working with groups of countries in so- called “coalitions of the willing” to drive new trade deals. Together with five other G20 leaders, I wrote to President Sarkozy ahead of the summit to call for new and innovative approaches to trade liberalisation. That is what was agreed in the communiqué.

On improving global governance, I presented a report, which I am placing in the Library today. We secured agreement for the key proposals. First, we agreed that the G20 should continue as an informal, flexible gathering rather than attempting a complete reordering of the system of global governance. What is needed is not new institutions, but political will. Secondly, we agreed that we should make the now established Financial Stability Board a separate legal body to give it the authority and capability that it needs. Thirdly, we agreed that we should strengthen the WTO’s role as the guardian of the world trade system. Further progress was also made on cracking down on tax havens and tax evasion and on having a proper regulatory system for banks to make up for the woeful system that has existed in so many countries, including ours, over the last decade.

On development, Bill Gates gave a presentation suggesting ways of mobilising resources to help the world’s poorest. This included helping some developing countries to help themselves through proper systems for collecting taxes and transparent revenues for natural resources. At the same time, he gave strong support to the UK’s own record on the development agenda.

On the financial transactions tax, I have been clear all along that we are not opposed in principle to such a tax if one could be agreed at the global level, but we will not unilaterally introduce a new financial transactions tax in the UK. Neither will we support its introduction in the European Union unless it is part of a global move. Britain has introduced a bank levy and we are meeting our global agreements on overseas aid. If other countries want to introduce new financial taxes at home, including to raise revenue for development, that is for them to decide. What they should not do is try to hide behind proposals for an EU tax as an excuse for political inaction on meeting targets, whether they be for spending on development or, indeed, climate change.

The current proposals for a financial transactions tax in Europe are so deeply confused that different European countries, and indeed European institutions, have talked about spending the revenues of such a tax in five different ways: on development, on climate change, on social policy, on resolving the banking crisis, and, most recently, as the best way to supplement the EU budget. I have to say that that would be a bit of a stretch even for Robin Hood.

Let me turn, finally, to the problems in the eurozone. It is clearly in our national interest for the eurozone to sort out its problems. As the Chancellor has said, the biggest single boost to the British economy this autumn would be a lasting resolution to the eurozone crisis. That is why Britain has been pressing the eurozone to act—not just at the G20, but for many months. The deal in Brussels 10 days ago was welcome progress, and it reflected the three essential elements that Britain has been calling for: first, reinforcement of the bail-out fund by eurozone countries to create a proper firewall against contagion; secondly, recapitalisation of weak European banks; and, thirdly, a decisive resolution to the unsustainable position of Greece’s debts.

The Euro area countries now need to do everything possible to implement their agreement urgently. Of course, the rest of the world can play a supporting role, but in the end this work has to be done by the eurozone countries themselves. No one else can do it for them. As I have said before, Britain will not contribute to the eurozone bail-out fund—whether that be through the European financial stability facility or a special purpose vehicle. And while the International Monetary Fund may administer a fund, it cannot and will not contribute to it.

The IMF does, however, have a vital role to play in supporting countries right across the world that are in serious economic distress. There are 53 countries currently being supported by the IMF, of which only three—Greece, Ireland and Portugal—are in the eurozone. It is essential for confidence and economic stability that the IMF has the resources it needs. So, at the G20, Britain, the US, China and all the other countries round the table made it clear that we are willing in principle to see an increase in IMF resources to boost global confidence. There was no agreement about the timing, the extent or the exact method through which this could be done. However, Britain stands ready to contribute within limits agreed by this House. Those who propose that we walk away from the IMF, or who oppose even the increase in IMF resources agreed by the last Government, are not acting responsibly or in the best interests of Britain.

It is in our national interest for countries across the world that are in distress to be supported in their efforts to recover. The collapse of our trading partners, whether in the eurozone or not, would have a serious impact on our economy. Businesses would not invest, British jobs would be lost, and families across Britain would be poorer. Through the IMF, we can help other countries in a way that does not affect our own public finances—but let me be clear: it is for the eurozone and the European Central Bank to support the euro, and global action cannot be a substitute for concrete action by the eurozone. The G20 withheld specific IMF commitments at this stage precisely because we wanted to see more concrete action from eurozone countries to make their firewall credible and to stand behind their currency. In short, the world sent a clear message to the eurozone at this summit: “Sort yourselves out and then we will help, not the other way round.”

These are very difficult times for the global economy. The Government are completely focused on one objective: to help Britain to weather the storm and safeguard our economy. Because of the tough decisions that the Government have already taken to get to grips with our deficits, Britain has avoided the worst of this stage of the global debt crisis. In 2008, under the last Government, UK bond yields were about the same as those in Greece; today, although we have the second highest deficit in the EU—second only to Ireland’s—our bond yields are almost the same as those in Germany, and around the lowest that they have been since world war two. That is because we have a credible plan to deal with our debts, and the resolve to see it through. The situation in Italy further emphasises the importance of a credible plan to deal with debts and ensure confidence in the markets more generally.

The eurozone must now do what is necessary, and see through the agreement that it reached in Brussels 10 days ago. Britain, and all our G20 partners, will continue to press for that to happen. I commend my statement to the House.

[Edward Miliband (Doncaster North) (Lab)]

I thank the Prime Minister for his statement, but I have to say to him—what a complacent statement from an out-of-touch Prime Minister! Anyone listening to him would think that the G20 summit had been a great success, but it was not.

Let me ask the Prime Minister about the three areas in which the summit should have made progress: the eurozone, reform of our banking system, and economic growth. On the eurozone, the Chancellor said in mid-September:

“'The eurozone has six weeks to resolve this political crisis.”

The six weeks are up, but there is no clear solution on financing. How much, from whom, and in what circumstances? None of those questions are being answered. Now we see the crisis in Greece spreading to Italy, and no plans for jobs and growth—just more austerity.

Can the Prime Minister tell us why European and G20 leaders failed to find a solution to the problems of the eurozone? Given that the Chancellor told us from Cannes that he and the Prime Minister were

“right at the heart of the discussions here”,

people will be struck by the Prime Minister’s tone today. Progress that was made at the summit was, of course, down to him—and, as always with this Prime Minister, failure is nothing to do with him.

Does the Prime Minister not now regret that he did not try harder and earlier to engage in the discussions and push for an agreement, rather than standing aside and claiming that Britain was a “safe haven”? If we were indeed at the heart of the discussion, can the Prime Minister say what responsibility he takes for the failure of the eurozone? Given the importance that all this has for Britain, can he tell us specifically what he plans to do in the coming days to secure an agreement?

Let me turn to the funding for the IMF. The Prime Minister said in his press conference on Friday, and again today,

“you can’t ask the IMF or other countries to substitute for the action that needs to be taken within the eurozone itself.”

We agree with that position. The sensible step of increasing resources for the IMF should not be taken to make up for inadequate eurozone action.

The Prime Minister has said that he would not support the direct use of IMF resources to top up the European financial stability facility, but can he also categorically rule out the use of IMF resources indirectly, in parallel, to make up for insufficient funding from the EFSF or the European Central Bank? Can he also square his position that his commitment is within agreed resources with the comment of the managing director of the IMF that there is “no cap…no ceiling” on IMF resources?

Let me turn to the issue of banking reform, and specifically the global financial transactions tax, which we support and believe should be implemented if we can reach agreement in all the major financial centres. It was on the agenda in Cannes, although no real progress was made. I have to say I could not tell from his statement whether the Prime Minister really supports it; after all, “not opposed in principle” is hardly a ringing endorsement. I do not think we should be surprised, because the week before the summit negotiations had even started, the Chancellor was writing to business leaders casting doubt on whether any such mechanism offers an efficient way to raise revenue. So can the Prime Minister tell us whether he actually argued for a global financial transactions tax at the summit, and can he tell us what steps he will be taking in the weeks and months ahead to advance its cause?

Turning to growth, the first substantive paragraph of the communiqué states:

“Since our last meeting, global recovery has weakened, particularly in advanced countries, leaving unemployment at unacceptable levels.”

That is certainly true in this country, where growth has flatlined and unemployment is at a 17-year high. So does the Prime Minister understand why people are so disappointed by the failure of the summit?

The Prime Minister talks about the words in the communiqué about trade and imbalances, but action on trade and imbalances will take years to implement. He also mentions undertakings by various countries who have scope to take action, but it is a very important point in the communiqué that they will be implemented only if

“global economic conditions materially worsen.”

People around the country will be wondering: how much worse do they need to get for action to be taken? He says, by the way, that nobody is arguing for Britain to change course, but the IMF said only last month that if the British economy continues to undershoot, the Chancellor should do just that. How much longer does the country have to wait for him to change course?

After the April 2009 G20 summit the Prime Minister said:

“The glitz and glamour of this week must seem very remote to the small businessman who still can’t secure the credit to stay afloat—or the mother worrying if she’ll be able to keep a roof over her children’s heads.”

The 2009 G20 summit succeeded, and this one failed. For the young person who is unemployed, for the business that has seen demand for its goods disappear, and for the shops that have seen people leaving the high street, this summit achieved precisely nothing. That is why the Prime Minister looks so out of touch when he claims that the summit has made a difference on growth. But is not the real problem this: the Prime Minister does not really believe that we need a global plan for growth? He thinks the answer for the world is collective austerity, just as he used to claim that the answer is austerity at home.

People wanted action from this summit, and they did not get it. Those struggling to find work, seeing their living standards squeezed, asking why the economy is not working for them, deserve better. Is not the truth that this is a do-nothing summit from a deeply complacent Prime Minister, out of touch with the real needs of our economy?

[The Prime Minister]

Honestly, I do not know who writes this rubbish! I liked the bit when the right hon. Gentleman quoted my response to the 2009 summit: I have to say that if the 2009 summit was such a success, why did the Labour party vote in the House of Commons against one of its key conclusions—the idea of increasing IMF resources? He talks about regulating banks, with no recognition of the failed regulatory system that he oversaw for a decade. He talks about the eurozone, with no recognition of the fact that Labour had a “national changeover plan” to get the whole of Britain to adopt the euro. Above all, let us be clear: if we had listened to his advice, we would not have been in Cannes discussing a Greek bail-out; we would have been at the IMF discussing a British bail-out.

Let me remind the right hon. Gentleman of the figures. In 2008 Greek and British bond yields were both 4.5%. Since then, in the UK that rate has halved, whereas in Greece it is up by six times. That is because they did not have a credible policy for deficit reduction, and we do.

Let me come back to the issue of the IMF, because what we are seeing from the Labour party is breathtakingly irresponsible. Let us be clear about its position on the IMF, and let us remember that that is an organisation founded by Britain, in which we are a leading shareholder, and also an organisation that rescued us from Labour in the 1970s. Labour’s position is, first, to vote against the increase in resources agreed by the G20 under their own Government. They called it a “triumph” at the time, yet Labour Members trooped through the Lobby in a complete display of opportunism. But it gets worse, because now they are saying that they do not want IMF resources for any eurozone country. Are they saying that they want to take the money from Ireland and Portugal? They would have turned up at the summit, where every country was talking about increasing IMF resources, and said that on no account would Britain support that. How ridiculous. They are saying to eurozone countries, which also contribute to the IMF, “You’re never, ever allowed to seek its assistance.” If they meant that, I would take it seriously—but this is all about politics: they are putting the politics ahead of the economics. We know that that is the case with the shadow Chancellor: he only ever thinks about the politics. The question for the leader of the Labour party today is: are you a bigger politician than that? I am afraid that the answer is no.

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

Did Chancellor Merkel tell my right hon. Friend why the European Central Bank is not fully discharging its duties as the euro’s lender of last resort? It is not providing massive quantitative easing, not moving towards near-zero interest rates and not urging President Sarkozy to renationalise the leading French banks before the credit crunch closes on France. Chancellor Merkel knows very well that it was not inflation but high unemployment which, in my lifetime, brought down the Weimar republic, and will do the same for the European Union.

[The Prime Minister]

My right hon. Friend speaks hugely powerfully about this issue. He is right that we must not allow the IMF to substitute for what the ECB and the other institutions of the European Union need to do; that is vital. It was one of the reasons why, in the end, all the countries of the world that were prepared to see an increase in IMF resources wanted to see more done by the eurozone and by the ECB. I have discussed this with Chancellor Merkel on many occasions. My right hon. Friend will know as well as I do of the huge hold-back that there is in Germany about what a central bank is, and what it should do. But I do believe that, as it says in the communiqué, you have got to have the institutions of the eurozone fully behind the currency in order to save it.

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

Understandably, the Prime Minister is putting a brave face on what happened last week. On any viewing, the G20 failed to reach its aims on growth, on the imbalances or on the eurozone crisis, which is as bad now as it was a few days ago. I see that there were reports that the G20 is planning to meet again, perhaps as early as in the remaining part of this year or at the beginning of next year. Is that right? If so, would the Prime Minister bear it in mind that in some ways, no summit is better than another failure? The G20 may not be perfect, but it cannot afford another meeting where it singularly fails to come up with the goods.

[The Prime Minister]

The right hon. Gentleman is entirely right: meetings that do not have a proper conclusion can often add to the problem rather than solve it. What is required is the political will for eurozone countries to act. I was very clear after the G20 meeting that it had not achieved a breakthrough on the euro—that is absolutely clear. Some progress has been made in terms of establishing the three elements that need to be put in place—the firewall, the recapitalisation and the Greek write-down—but much more has to be done. There may well be a meeting of G20 Finance Ministers, but I agree with the point that the right hon. Gentleman makes: it is progress and resolution of these issues that is required, rather than another meeting.

[Several hon. Members]

rose—

[Mr Andrew Tyrie (Chichester) (Con)]

The European Commission has estimated that implementation of the financial transactions tax would reduce gross domestic product in the euro area by 1.8%. Of course, that would hit the UK disproportionately hard at a time when we need more growth, not less. Does the Prime Minister agree that, of all times, now is not the appropriate moment to consider such a controversial measure?

[The Prime Minister]

It is important for people to see the European Commission report on the financial transactions tax, which shows the figures that my hon. Friend talks about, and shows that it would cost jobs. As I have said, if we could achieve global agreement for a tax of that nature there would be a case for it, but it is very hard to see that happening. I think that the focus of politicians in Europe should be to meet the promises they have already made about development rather than to hide behind a financial transactions tax that they know is very unlikely to come into being.

[David Miliband (South Shields) (Lab)]

The frustration and impatience that the Prime Minister expressed on Thursday and Friday last week were extremely well merited, and it would be as well if he came here and repeated his concerns about the failure of leadership across Europe at this vital time. In that context, though, is it not a tragedy that when Europe does need a voice for reform—for example, on budgetary policy, which is going to be a major issue in coming years—he has dealt himself out of the game with a focus on the repatriation of powers, which, frankly, is not the issue that is going to make or break the European economy?

[The Prime Minister]

I do not agree with the right hon. Gentleman, for this reason: I have managed to assemble a coalition for budgetary restraint in the European Union, and this year Britain, France, Germany and others have all agreed to freeze the EU budget in real terms. I would like to go much further, but I have to say that a freeze in the budget in real terms is not something we have been able to achieve in recent years, and is a breakthrough, so I do not accept the point about looking at rebalancing powers in Europe and fighting for a deal on the budget. We can do both.

[Mr William Cash (Stone) (Con)]

Given that the single market, including the City of London, is governed by qualified majority voting, how does the Prime Minister propose to achieve a majority to protect our interests in the context of the fiscal union that he advocates?

[The Prime Minister]

First, we need to disconnect the issues that my hon. Friend raises. The issue of the single market and the threat to the City of London and Britain’s financial services is a real threat. We have to work extremely hard to build alliances in the single market and in the European Council to stop directives that would damage our interests. I think it is extremely important that we do that work. Financial services matter hugely to this country, and this is one of the areas that I want to ensure we can better safeguard in future.

I do not support fiscal union. I do not think that Britain ought to join a fiscal union, as I do not think that is the right move for us. However, we have a single currency that is quite dysfunctional, and one way in which it could be made more functional is greater fiscal union. That is a statement of fact rather than our saying that we want in any way to join it: we do not. We want to safeguard the interests of Britain by making sure that the single market works for us.

[Glenda Jackson (Hampstead and Kilburn) (Lab)]

Is it really in the best long-term interests of this country for the Government consistently to present the United Kingdom as the neighbour from hell with regard to the European Union—not least with regard to the Tobin tax? The issues on which the European Union wishes to spend money are the issues on which the Prime Minister’s constituents and mine, and citizens around the world, wish to see money spent—not least on alleviating suffering in the third world and on climate change. Will he change his mind on this issue?

[The Prime Minister]

With great respect to the hon. Lady, this Government—and to an extent the Governments whom she supported—have made and kept promises about things that our constituents care about, such as development and climate change. We are meeting those. As for being a good neighbour, one of the most unneighbourly acts someone could perform when the whole world is looking at growing the resources of the IMF to safeguard the global economy is to walk away from that and vote against it—something that I know that quite a lot of Labour MPs, probably including some on the Front Bench, are rather ashamed of. Such an act would show them to be not only not a good neighbour, but on another planet.

[Mr John Redwood (Wokingham) (Con)]

As there is a danger of the euro crisis now spreading to Italy, can the Prime Minister tell me what the leaders of euroland have said they will do by way of buying Italian bonds or offering subsidised loans to Italy to head off the crisis in the market there?

[The Prime Minister]

My right hon. Friend asks an important question. It goes back to the question that the Father of the House asked, about the actions of the ECB. The ECB has been intervening in markets and buying bonds of countries that are under pressure. That is what makes it so difficult to understand why some in Europe are so opposed to the ECB being more of a monetary activist, if I could put it that way. The key with Italy—everyone should be careful about speculating about another country—and the point I made in my statement is that Italy must demonstrate that it has a credible fiscal path. That is as much about the confidence of the markets that it will be able to pay its deficit and pay its debts. If it can do that, its interest rates will fall.

[Kelvin Hopkins (Luton North) (Lab)]

The door marked “Exit from the eurozone” is now clearly in view and a number of eurozone states are moving inexorably towards it. Is it not obvious that until those states can recreate their own national currencies and find an appropriate parity for those currencies, they will not recover?

[The Prime Minister]

The hon. Gentleman refers principally, I think, to Greece. That is an issue that the Greeks have to decide themselves. They have been offered a deal that writes down their debts and can enable them to stay in the single currency; it is their decision whether to take that road or to take another road. The only thing I would say to Members of the House who are deeply sceptical about a single currency, of whom I am one, is that we should be very careful to recognise that countries leaving a single currency can cause all sorts of knock-on effects and problems for other economies, including our own. We should not see it as some sort of painless easy option for a country to fall out of the euro. It would have very real consequences for other countries, including our own, and we have to think about that in that context.

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

Given the role that the big banks played by being overstretched and therefore triggering the present financial crisis, can the Prime Minister tell us what progress he made in persuading his colleague countries in the G20 to follow the proposal that we made and that the Vickers commission recommended to break up the banks that are too big to fail, so that in no economy are the big financial institutions able to hold a gun to the state and to the taxpayer?

[The Prime Minister]

Obviously, many people will comment on the ultimate failure of the G20 to resolve the eurozone crisis, but the G20 has made good steps forward in areas such as trying to roll back protectionism, and particularly on the issue that the right hon. Gentleman raises about globally significant financial institutions and the impact that they can have. The approach that Vickers recommends is fully in tune with what other G20 countries are recommending.

[Mr Dennis Skinner (Bolsover) (Lab)]

Does the Prime Minister realise that the British people out there are listening to the sheer effrontery of this British Prime Minister suggesting a growth plan for Greece, Italy, Spain and Portugal, while here at home he sticks rigidly to high inflation and mass unemployment? Hypocrisy by the bucketful!

[The Prime Minister]

That probably sounded better in front of the mirror than when the hon. Gentleman got to the Chamber.

[Michael Fallon (Sevenoaks) (Con)]

Does my right hon. Friend agree that one of the biggest single fillips to global growth would be breaking the deadlock over the Doha round? Can he say how confident he is now that the approach of willing coalitions will help make progress on this issue under the Mexican presidency?

[The Prime Minister]

I thank my hon. Friend for that question. The point about Doha is that it is not progressing in the way that it was meant to. There is a gridlock between many of the developing countries and, particularly, countries such as America that do not see enough in the round for them. So it seems that the only way forward, if we want to see more global trade deals that are good for all those participating, is to have coalitions of the willing—countries that want to push ahead. That is what has been sanctioned at the G20, and that is what we can now push ahead with.

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

Greece, Spain and Portugal already are, and Italy probably is, insolvent within the European monetary union. None of these countries is likely to regain its competitiveness while it is part of the single currency. Does the Prime Minister not think it would be better for the IMF to give them extra funds only once they have left the single currency, rather than while they are part of the EMU?

[The Prime Minister]

The hon. Lady makes an important point, but it is not necessarily fair to lump all those countries together. Some of them, such as Italy, have huge deficits in terms of the ratio of debt to GDP, but have managed to compete within the single currency, so I am not sure that the way in which she groups those countries together is entirely fair. The important role of the IMF is not to support a currency system, not to support the eurozone, and not to invest into a bail-out fund. The IMF has to be there for countries in distress. That is why everyone in the House supported, for instance, the IMF programme that went into Ireland. The IMF went in as a partner of other countries, but it did go in. If she turns her question round the other way, it would be extraordinary, would it not, to say to eurozone countries, “You are shareholders in the IMF, you contributed to the IMF, but when you’re in distress you can’t get any money from the IMF at all”? That would be an extraordinary position—but it is one that seems to have the support of those on the Labour Front Bench.

[Mr Edward Leigh (Gainsborough) (Con)]

Has not the avoidance of a concentration of political and economic power on the continent been a cardinal feature of British foreign policy for 300 years? How then is it in our interests to facilitate the creation of a single fiscal and monetary union that will have enormous power over us, but over which we will have very little influence?

[The Prime Minister]

My hon. Friend asks a question with a broad historical sweep. We are suffering at the moment from a single currency that we are not a member of, but that has some serious structural faults. It is in our interests that those faults are resolved, and one way of helping to do that would be to have a greater pooling of fiscal sovereignty among the members of the single currency. I always felt that that was necessary and was going to happen, which is one reason why I never supported the single currency. However, I do not think that we can stick happily with the status quo when the single currency is having a chilling effect on our economy, through the crisis, and not seek some sort of resolution.

[Keith Vaz (Leicester East) (Lab)]

A few years ago the President of Yemen was invited to the G20, but the country now has the world’s third highest rate of malnutrition. What additional help can Yemen be given as a result of the G20 meeting? Would the Prime Minister be happy for some of the IMF money he has just given to go to Yemen?

[The Prime Minister]

First, we have not yet given any IMF money. There was no agreement on how much should be given, exactly when it should be given or in what way. The world was saying that it stood ready to support the IMF. The IMF has supported countries like Yemen in the past and, as the right hon. Gentleman knows, we have put development aid into Yemen. The biggest challenge in Yemen is the lack of effective governance, and I think that what Bill Gates was talking about—proper systems for raising taxes and for transparency in Government revenues and in revenues from extractive industries and minerals—are the keys to helping such countries along their way.

[Mr Douglas Carswell (Clacton) (Con)]

Back in July the Financial Secretary to the Treasury told a Committee of this House, with regard to IMF obligations:

“We have an agreement to fund up to £20 billion, broadly speaking.”—[Official Report, Second Delegated Legislation Committee, 5 July 2011; c. 9.]

Pretty broad, it turns out. We now hear that the figure is closer to £40 billion. Does my right hon. Friend agree that it is vital to level with the British people, with no weasel words or sophistry, and that Ministers have an obligation to be absolutely straight about what they plan to do with other people’s money?

[The Prime Minister]

Let me be absolutely clear about this. There are two sorts of money that the UK provides to the IMF: money through our quota, which is effectively through our shareholding, and money through loans and other arrangements. There have been three votes in this House in the last three years on all the elements of the IMF money. As I have said, if it comes to giving extra support for the IMF, we want to do that within the headroom that has been set.

[Mike Gapes (Ilford South) (Lab/Co-op)]

Are we not really dealing with a sophisticated form of Russian roulette, in which the Prime Minister tells us on the one hand that he does not think that it is right for eurozone countries to have their funding from the IMF cut off, but says on the other hand that at this stage there should be no additional money from the IMF? When will the stage be right for that additional IMF money?

[The Prime Minister]

There are 53 IMF programmes around the world, only three of which are in the eurozone, so in part it is a judgment for the IMF about when it needs to replenish its resources. Let me be clear about what needs to happen in the eurozone countries. They have to sort out the problems of the euro: they need that firewall, and it is Europe that effectively has to provide it. They need that recapitalisation and the demonstrable and clear write-down of Greek debts. Those are the things that they have responsibility for. We have responsibility, as an IMF shareholder, for bulking up the IMF finances at the right moment. I do not see that as Russian roulette; it is just very sensible economics and politics.

[Louise Mensch (Corby) (Con)]

Can my right hon. Friend tell the House what advice he has received on the consequences of failing to pay our IMF subscriptions, as so irresponsibly advocated by the Opposition?

[The Prime Minister]

My hon. Friend makes a very good point. I am not entirely sure what would have happened if we had turned up at the G20 having voted down the deal from the London G20 on increasing the IMF resources. First of all, we would have declined to implement one of the key findings of the last G20, and then we would have turned up and said that we were not prepared to see any increase in IMF funding for anything else. Britain would have been completely isolated and left out. The reason why the Opposition are talking about this is that it is all about the politics and nothing to do with the economics, and they know it.

[Stewart Hosie]

(Dundee East) (SNP): The Prime Minister said that the UK would not fund the EFSF, but it remains one of the eurozone’s most powerful tools, and there are two new powers proposed for it—to insure newly issued sovereign debt, and to spin out investment trusts to buy that debt. Do the Prime Minister and his Government believe that those powers will be enough to leverage the EFSF up to the €1 trillion or so required to give it the firepower that it needs?

[The Prime Minister]

There are still real difficulties with that. The EFSF and the idea of a special purpose vehicle were set out at the eurozone meeting 10 days ago, but the problem is that since then we have not seen enough detail on how exactly those funds would work and how they would be levered up. You need—I have used “bazooka” before—a bazooka big enough to convince people that you will not have to use it, and that is what the eurozone needs to do, but it has not yet completed that work.

--- Later in debate ---

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

Why does the Prime Minister seem to think that the Greeks will be any more successful at staying in the euro than we were at trying to remain in the ERM?

[The Prime Minister]

One of the few advantages of the ERM was that you were able to get out of it, but one of the issues with the euro is that there is not a mechanism, properly and legally, for leaving it. If a country wanted to leave the euro, of course it could, but in the end this is an issue for the Greeks. They have to decide: do they accept the deal on the table that cuts their debt, and stay in the euro, or do they take a different path? The point I have been making is that they have to make up their mind for the rest of the world to move on.

[Jeremy Corbyn (Islington North) (Lab)]

Was there any discussion at the G20 about the unaccountable power of the rating agencies to decide the future of national economies, or about the massive profits being made on short-term loans out of the poverty and austerity of Greece, Portugal, Spain and Ireland—any discussion about control over the banking system, rather than bowing down to it?

[The Prime Minister]

There were concerns expressed, and they are frequently expressed, about the role of the ratings agencies and the way they are regulated. Sometimes, they come from politicians who have had a particularly rough time with the ratings agencies, but it is very important that we use organisations such as the Financial Stability Board to make sure that we get the answers right, rather than do it according to political fiat.

[Mr David Ruffley (Bury St Edmunds) (Con)]

We must have contingency plans if the eurozone breaks up. Does the Prime Minister agree that Parliament must be given a very early opportunity to scrutinise the adequacy of those contingency plans?

[The Prime Minister]

My hon. Friend makes an important point, but that is quite a difficult ask, because there is of course important ongoing work on contingency plans, but the more we discuss and speculate on the nature of another country’s currency and economy, the more we could damage their interests. So, I will think carefully about what he says, but it might be difficult to air some of those issues in public.

[Geraint Davies (Swansea West) (Lab/Co-op)]

The Prime Minister knows that the IMF currently gives 32.4 billion special drawing rights—about £32 billion—to the eurozone to prop it up, so how can he justify giving more British taxpayers’ money to the eurozone via the IMF when there are people starving in Africa and people cannot pay their heating bills in Britain?

[The Prime Minister]

No country has ever lost money lending it to the IMF. The IMF is, in a globalised world, a vital institution for supporting countries that get into deep economic distress, and, if we were to walk away from it and just to allow trading partners—in the eurozone or outside—to collapse with no one to help them, that would mean British jobs lost and British businesses going bust. It might give you a five-second soundbite on the news in order to try to give you some political advantage, but it would be completely irresponsible.

[Mr Bernard Jenkin (Harwich and North Essex) (Con)]

I agree with my right hon. Friend that Greece’s remaining in the eurozone is a matter for the Greek Government, and that there is no free hit for the break-up of the euro, but will he take time to read the Centre for Economics and Business Research paper, which points out that, for Europe as a whole and the United Kingdom in particular, our economy will be growing faster in two years’ time if the euro breaks up than it will if we try to keep the currency going?

[The Prime Minister]

I have seen reports of the piece of work that my hon. Friend speaks about, and perhaps I will have time this evening to read it at greater leisure. We can look at the economic experts and what they say, but there is quite a strong consensus that the consequences of a country falling out of a single currency zone, where banks and businesses are very interrelated, are very serious for all the members concerned. As I say, if it happens, we will have contingency plans in place and we will have to manage them as best we can, but no one—however sceptical they are about the euro—should think there is an easy way for a country to leave.

[Sir Stuart Bell (Middlesbrough) (Lab)]

Now that the Greeks will have a new Government who will ratify the 26-27 October agreements, and as the Group of Twenty is an informal grouping, would it not be appropriate, where there is agreement, for the group’s Finance Ministers to get together to help the European financial stability fund put together its firewall under the Sarkozy presidency?

[The Prime Minister]

The G20 Finance Ministers might have to meet again, but, as I said in answer to the right hon. Member for Edinburgh South West (Mr Darling), only if a new set of arrangements is being put in place. Part of the problem in Europe is that, so often, meetings are scheduled without proper thought about what the outcome will be—about what will be achieved. That has been one of the things that have caused a huge amount of market turbulence over recent months.

[Nadhim Zahawi (Stratford-on-Avon) (Con)]

Figures out today show that EU productivity is falling at its fastest rate since 2009. The only big economy to record an expansion in output per worker is the UK. Why does the Prime Minister think that the United Kingdom can borrow at a 0.5% interest rate for one year’s money, compared with 4.7% for Spain and 6.3% for Italy?

[The Prime Minister]

My hon. Friend makes an important point. First, in getting greater competitiveness across Europe, this is the most important thing that Europe could be doing right now: completing the single market, completing the market in energy, completing the market in services and making sure our economies are competitive. The point he makes about the bond market is vital, too. The fact is that if you do not have credibility, you cannot borrow money at low interest rates, and if you do not have credibility, interest rates go up. That would be the worst thing to hit your economy.

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

At summit after summit, the Prime Minister has argued to support a monetary union he does not really think is appropriate for this country and in which he does not believe, so that stability can be brought to Europe and the world. That has failed. How many more failures will it take and how many more summits will there be before he argues for what is really right for Europe: for those countries to return to their original currencies?

[The Prime Minister]

I have sympathy with the hon. Gentleman’s point, which has complete intellectual coherence. The fact is that they could go in that direction, but other European Prime Ministers, Finance Ministers and, indeed, the people in those countries will say that they do not want to leave the euro and that they want to make the euro work. We are affected by what is happening in the eurozone, which is why I keep saying that it is in our interests that they get their act together and make their currency work. You can argue for the opposite, but the fact is that that is what most European countries want and that is what I think they will try to achieve.

[Mr Peter Bone (Wellingborough) (Con)]

I do not know whether the Prime Minister remembers 16 September 1992—golden Wednesday—when the United Kingdom came out of the exchange rate mechanism, which was the start of our economic recovery. Why are the political elite of Europe denying Greece and other euro countries the same mechanism to improve their currency: withdrawal from the euro so they can re-establish their national currency?

[The Prime Minister]

I learned a very important lesson from our experience in the exchange rate mechanism: never fix interest rates in a way like that because you may need a different interest rate in your economy from that applying elsewhere. That is why I am so completely opposed to Britain ever joining the euro. I could not be clearer about that—unlike the Labour party, which spent 13 years planning and preparing for our eventual admission to the euro. We must allow other countries to make their own choices, and the choice of people in Greece—it is their business—seems to be that they want to stay in the euro. That is not the choice I would necessarily make—or that Mrs Bone, or even Mr Bone, would necessarily make—but that is the choice they seem to want to make and we have to support them in it.

[Mr David Anderson (Blaydon) (Lab)]

Another report came out today from the Institute for Public Policy Research showing that 32,000 jobs in the public sector were lost in the north-east last year while the number of private sector jobs also went down, and the number of public sector jobs in London and the south-east went up. Why should the Europeans trust the action plan from the Prime Minister when his inaction plan in this country is destroying the regions of this country?

[The Prime Minister]

Of course there has to be a rebalancing of public sector and private sector jobs in our economy, and of course there are difficult circumstances faced by different parts of the country, but in the north-east we have seen the expansion of the Nissan plant, and we have the new Hitachi train plant going into the north-east as well. What we need to do as a country is to become more competitive—to start manufacturing and making things again, which will benefit all the regions of our country.

[Tony Baldry (Banbury) (Con)]

Would not France, among other countries, do rather more to help developing countries if it met its own UN target for international development, as we are doing, rather than exhorting those of us who are meeting our UN targets to sign up to a financial transactions tax?

[The Prime Minister]

My hon. Friend puts his finger on it. Some other countries are using the cover of a financial transactions tax to get off the fact that they have not met their targets for overseas development assistance. In all the figures that we bandy around about the financial transactions tax, it is worth bearing in mind the fact that around 80% of it would be raised from businesses in the United Kingdom. I am sometimes tempted to ask the French whether they would like a cheese tax.

[Mr Ronnie Campbell (Blyth Valley) (Lab)]

Seeing that the European Central Bank has been told to sit on its hands, obviously by the Germans, is it not time that the Prime Minister reminded the Germans that it was the Marshall plan that saved their country after the war?

[The Prime Minister]

The European Central Bank is independent; no one is able to tell it what to do. There is a very strong case for saying that the eurozone institutions, including the ECB, need to do more to stand behind their currency and their currency zone, but we have to understand why the Germans feel as strongly as they do, and it is partly based on their history and what they feel went wrong in the 1920s and ’30s. None the less, I think that the argument that the ECB and the eurozone institutions need to do more is right.

[Margot James (Stourbridge) (Con)]

Does my right hon. Friend agree that if we were to listen to Labour and ease our deficit reduction strategy, our interest rates would soar towards Italian levels and away from German levels, and will he explain to the British taxpayer what that would be likely to cost in increased interest payments?

[The Prime Minister]

My hon. Friend makes an important point. It is not just a question of the extra interest payments the Government would have to pay, although that would be pretty crippling for the taxpayer; it is also the fact that those higher interest rates would affect business investment and the mortgages that people pay. We could see a really bad effect on households and business as well as on the Government finances.

[Nic Dakin (Scunthorpe) (Lab)]

When will the G20 show global leadership and produce a plan for growth and a plan for jobs?

[The Prime Minister]

The point about the global plan for growth and jobs—and the reason it is worth while, and the whole of the G20 process is worth while—is that different countries are committing to doing different things at the same time to maximise global growth. It is quite clear that Britain needs to get on top of its debts and its deficit and export more; it is also clear that China needs to grow its consumption, grow its middle class, and import more. If we all do these things at the same time, we will find that we can maximise global growth and increase employment levels too.

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

I entirely agree with my right hon. Friend’s statement that the UK should not contribute to any further eurozone bail-out fund, but how can UK taxpayers be certain that our contributions to the IMF will not be used for such purposes when the UK has only 4.29% of the vote on the IMF governing body?

[The Prime Minister]

The IMF has extremely tough and clear rules about when it can and when it cannot lend money. That is why it cannot put, and nor would we support its putting, money into a euro bail-out fund or into a special purpose vehicle. That is not the role of the IMF—that must be the role of the European financial stability facility—but what the IMF can do is lend money and help countries that are in distress. As I said, no country has ever lost money on lending it to the IMF, because it is the senior creditor in all these arrangements.

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

The Prime Minister keeps talking about rebalancing the economy. We have seen a 20% to 25% reduction in the value of the pound, which should have made us competitive, yet the private sector is not taking up the slack because there is no confidence out there. Do we not need another plan to build confidence?

[The Prime Minister]

The worst thing we could do for confidence would be to abandon the plans to deal with our debt and our deficit, because we can see what is happening in countries such as Italy that do not have a proper plan for getting on top of their debts: they have higher interest rates and all the problems that they bring. The hon. Gentleman is right that we have had a depreciation in our currency that should lead us to be more competitive. If one looks at the export figures from Britain to countries such as India and China, one sees that there is a good increase in our exports.

[Harriett Baldwin (West Worcestershire) (Con)]

My constituents do not want to pay taxes to bail out the euro. Will the Prime Minister remind us who got this country into the permanent EFSF and who got us out of it?

[The Prime Minister]

None of our constituents wants to pay taxes to bail out the eurozone; that is not what our taxes should go towards. When we came to office we were part of the European financial stabilisation mechanism—the EFSM. I have got us out of that from 2013, but between now and then we are still at risk because of a very bad decision to which the previous Government agreed.

[Derek Twigg (Halton) (Lab)]

If the eurozone continues to fail to deal with the crisis, what actions will the Prime Minister take to protect the interests of the UK?

--- Later in debate ---

[The Prime Minister]

We must put in place contingency plans for any of these countries leaving the eurozone. The hon. Gentleman asks what those plans are. For obvious reasons, if we start to describe exactly what we might have to do, we could set off all sorts of chain reactions. If he wants to discuss privately with a Treasury Minister the elements of any plan, he is at liberty to do so.

[Mr Philip Hollobone (Kettering) (Con)]

Is it the Prime Minister’s understanding that were Greece, Italy or any other country to leave the eurozone, it would require a treaty change?

[The Prime Minister]

I believe my hon. Friend is right that there is nothing in the treaties that allows a eurozone member to leave the eurozone yet stay in the European Union. My sense is that were that to happen, some allowance would be made. He is right to say that that would involve a treaty change at some stage to ensure that it was legal.

[Sheila Gilmore (Edinburgh East) (Lab)]

The Prime Minister has suggested that he is in favour of a global financial transaction tax. That will happen on a global basis only if people take the lead. What my constituents wanted to know when they contacted me was what steps the Prime Minister took at the Cannes summit to promote that tax.

[The Prime Minister]

I spoke on the financial transaction tax at the session where it was discussed and said that we supported it at a global level. I made a few of the points that I have made in the House today because sitting around the table were the representatives of European countries and institutions, including the European Commission, that have spent this money several times over. When we talk about the European budget, such a tax is given as the great way to raise money for that; when we talk about development, it is given as the way that we will pay for development; when we talk about climate change, it suddenly becomes the magic way to meet all our climate change commitments. Frankly, I do not think that we should allow other European countries to get away with that.

[Mr Ben Wallace (Wyre and Preston North) (Con)]

It is highly likely that China’s condition for buying into eurozone debt will be the lifting of the EU-wide arms embargo, which would be directly against Britain’s national interests given its defence industry base and the tens of thousands of jobs that are dependent on it. Given that that would require a unanimous decision by all EU member states, will the Prime Minister confirm that the UK Government would veto such a request?

[The Prime Minister]

We do not support the lifting of the arms embargo. In the discussions at the G20, there was not some sort of shopping list from the Chinese—a rather unfair point that some have made. Clearly, it is in China’s interests, just as it is in our interests, that the eurozone crisis is dealt with. China has huge export markets in Europe and it owns huge amounts of European debt. That is why China, like Britain, subscribes to the IMF and will support an increase in its resources.

[Mr Wayne David (Caerphilly) (Lab)]

The Prime Minister has said that the action plan for growth and jobs includes many of the things that Britain is already doing. I can assume only that it is a very thin document. How many minutes were spent talking about job creation at the summit?

[The Prime Minister]

A great deal of the first day was spent talking about the condition of the world economy, and particularly the fact that economies in the developed world are obviously seeing very low rates of growth. I also had a meeting, I am pleased to report, with the leader of the TUC and other international trade unionists, to discuss specifically growth and jobs, and how we can try to prevent youth unemployment from rising in western European countries. I do not know whether all my predecessors always found time for such meetings at the G20, but I was delighted to have one.

[Joseph Johnson (Orpington) (Con)]

Did the Prime Minister see at the G20 any evidence that eurozone leaders were becoming clearer that it is an entirely fanciful notion to expect China to bail out eurozone countries whose GDP is many times its own?

[The Prime Minister]

I would not underestimate the huge pressure that the eurozone leaders are under to come up with a solution to the crisis in the eurozone. Clearly some of them have huge ideological difficulties with seeing a greater role for eurozone institutions. I do not think it is completely out of the question that other countries—China, or Saudi Arabia—might at some stage want to contribute to a eurozone fund, not least because the risk would be taken with the eurozone money and not with the Chinese or other money. In the end, however, there is no substitute for the eurozone acting first to sort out its difficulties.

[Steve McCabe (Birmingham, Selly Oak) (Lab)]

Which were the countries persuaded by the Prime Minister that they had space to borrow for what he calls “further discretionary measures”?

[The Prime Minister]

A list in the action plan for growth and jobs specifically states that countries such as Canada, China and others could borrow more. They are set out in the communiqué, a copy of which is in the House of Commons Library.

[Mrs Eleanor Laing (Epping Forest) (Con)]

Will the Prime Minister reassure the House that he will not take the advice of Opposition Members and increase the deficit to boost growth artificially? The consequent rise in interest rates and inflation would cause enormous damage to small businesses and families right across this country.

[The Prime Minister]

My hon. Friend is absolutely right. If we went to the G20 summit arguing for a £20 billion increase in borrowing this year, or the increase that Labour supports of £87 billion over the Parliament, at the same time as saying that we were going to get out of the IMF, I think the G20 would conclude that we were completely barking.

[Dr Sarah Wollaston (Totnes) (Con)]

The more a balloon is inflated, the more it hurts when it eventually explodes. Would it not be better for us to help the Greeks default and devalue now rather than later?

[The Prime Minister]

We have argued very consistently that part of any solution has to be a very decisive writing down of Greek debt, because it obviously cannot afford the level of debt that it currently has. That is the plan that it is being offered. Some would argue that even that is not enough, and that is my hon. Friend’s position, but our view has always been that unless the debts are written down significantly, there will not be a proper solution.

[Mr Julian Brazier (Canterbury) (Con)]

My right hon. Friend has rightly argued that fixing the eurozone is a matter for eurozone countries. May I welcome the fact that he has announced that we are making contingency plans for the possibility of that failing?

[The Prime Minister]

I am grateful to my hon. Friend. As I said, it is difficult to say more about it in the House, but I will discuss with Treasury Ministers whether we can say a little bit more. If Members have contributions that they want to make or concerns about elements of any contingency plan, which would have to be very wide ranging and cover all sorts of different eventualities, they should talk to Treasury Ministers.

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

Does the Prime Minister have an estimate of the liability that the UK would have incurred had we not excluded ourselves from the European financial stability mechanism bail-out fund that the Labour Government supported?

[The Prime Minister]

One thing that we have managed to keep out of is the European element of the Greek bail-out. That has had two iterations, and we were not involved in the first or the second. The specific idea of using the EFSM to support Greece was batted away by Britain.

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

One of the key issues about the eurozone is the need to recapitalise a number of European banks, especially those that are quite weak. What comments can the Prime Minister make about the relative strength of UK banks, and will he say that the UK taxpayer will not have to stump up any more cash to recapitalise our banks?

[The Prime Minister]

On the current plan for the recapitalisation of European banks, British banks would not require any additional capital because they are quite well capitalised already. There is a concern that needs to be expressed that as the Europeans move to recapitalise their banks, it is quite important that they do not do that purely by shrinking bank balance sheets, and that they encourage banks to find fresh sources of capital so that lending does not decrease in the European Union.

[Mr Stewart Jackson (Peterborough) (Con)]

Are we not in danger of ignoring the political reality of the current situation, which is that saving the euro at almost any cost is in the long-term interests of Germany, but not necessarily that of the taxpayers of the United Kingdom? That being so, surely the ECB and not the IMF must be the lender of last resort.

[The Prime Minister]

I certainly agree with my hon. Friend’s last point. The point about the future of the euro is that we should take a very hard-headed, national-interest view. All the evidence is that a disorderly break-up of the euro would have very bad effects on all the economies within Europe, and bad effects on Britain. One can make longer-term arguments about what it might mean and how things might change but, in the short-term, there is no doubt that when we are trying to secure growth and jobs in this country a disorderly break-up of the eurozone would not be good for Britain.

[Kris Hopkins (Keighley) (Con)]

May I thank the Prime Minister for the thoughtful and constructive leadership that he offered at the G20? The debate has focused quite narrowly on Greece in recent weeks. What is his interpretation of the emerging situation in Italy?

[The Prime Minister]

We all have to be careful not to speculate on other countries, but the requirement of those who are lending money to Italy is a clear and consistent plan for Italy getting on top of its debts and deficit. When they see that, interest rates will come back down again. However, that is a lesson to any country that if they do not have credibility in the markets, their interest rates can go up quite quickly.

[Karen Bradley (Staffordshire Moorlands) (Con)]

Does the Prime Minister agree that the UK already has a financial transactions tax—one that raises around £3 billion a year? It is just that we call it stamp duty.

[The Prime Minister]

My hon. Friend makes a very good point. One point that Bill Gates made to me is that if other European countries introduce stamp duty on shares, they might find that they can get to the 0.7% of GDP that they are meant to be giving in overseas development assistance without having a financial transactions tax. If they care about overseas development, as this Government do, that might be quite a good answer.

[Several hon. Members]

rose—

Oral Answers to Questions

Lord Cameron of Chipping Norton Excerpts

Wednesday 2nd November 2011 Commons Chamber

[Mr Marcus Jones (Nuneaton) (Con)]

Q1. If he will list his official engagements for Wednesday 2 November.

[The Prime Minister (Mr David Cameron)]

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 Jones]

With the average 60-year-old living 10 years longer than in the 1970s, public sector pension reform is essential. Will the Prime Minister ensure that reform is fair for my constituents, both in terms of taxpayers and public sector workers?

[The Prime Minister]

My hon. Friend makes an important point, and the Chief Secretary to the Treasury will be making a full statement to the House. It seems to me to be absolutely vital that we do something that is fair to both taxpayers and public sector workers. The cost of our public sector pensions system is up by a third in the last decade. It is not fair to go on as we are, but the new arrangements must be fair to people who work hard in the public sector and on whom we all rely. I can tell the House that low and middle-income earners will actually get more from their public sector pensions, everyone will keep what they have built up so far, anyone within 10 years of retirement will see no change to their pension arrangements and, at the end of all this, people in the public sector will still get far better pensions than people in the private sector. I really think it is time that the Labour party was clear that it does not support strikes later this month.

[Edward Miliband (Doncaster North) (Lab)]

Does the Prime Minister believe that growth of 0.5% over the last year and unemployment at a 17-year high point to the success or failure of his economic plan?

[The Prime Minister]

Obviously, everybody wants the British economy to grow faster—that is what everybody wants. Yesterday’s figure of 0.5% was better than many people expected and is it not noticeable that the right hon. Gentleman cannot even bring himself to welcome news like that? The key issue we all have to address is this: there is a global storm in the world economy today and it is in our interests to help others to confront that global storm, but we must also keep the British economy safe. We will not keep it safe if we add to our deficit, add to our debt and put interest rates at risk.

[Edward Miliband]

First the right hon. Gentleman blamed the Labour Government, then he blamed Europe, and yesterday he apparently blamed his Cabinet colleagues for the lack of growth in our economy. The truth about this Prime Minister is that when things go wrong it is never anything to do with him.

Let me ask about another of his flagship policies, the business growth fund, which was launched nine months ago with the banks. Can he tell us the number of businesses the fund has invested in?

[The Prime Minister]

First, the problem with pre-scripted questions is that the right hon. Gentleman does not listen to the first answer. I did not actually in my first answer blame the last Labour Government, but if he would like me to do so I can start right now, because it was the last Labour Government who left us the record debts and the record deficit, and it is this Government who are having to deal with that.

The right hon. Gentleman asks about the business growth fund. This is one of the schemes to ensure that banks are lending, alongside the Merlin scheme, which is actually seeing an increase in lending to small businesses. That is the record we can be proud of—and something he did not achieve.

[Edward Miliband]

We all know by now with this Prime Minister that when he blusters like that at the Dispatch Box he is either too embarrassed to answer or he does not know the answer, so let me help him. The business growth fund was announced nine months ago, it has five offices and 50 staff. How many investments? A grand total of two. It is becoming a pattern with this Prime Minister: fanfare announcement then radio silence. He said in March:

“I’m going to watch those banks like a hawk and make sure they deliver”.

So what is he going to do to get the business growth fund moving?

[The Prime Minister]

These are the banks the right hon. Gentleman completely failed to regulate year after year—[Interruption.] Yes, yes, and these—[Interruption.]

[Mr Speaker]

Order. The House is getting—[Interruption.] Order. Mr Ronnie Campbell, calm yourself. The House is getting far too excited. It is only six minutes past—[Interruption.] Order. Let me say it at the outset: both the Prime Minister and the Leader of the Opposition must be heard. It is called democracy and free expression.

[The Prime Minister]

Let me just give the right hon. Gentleman the figures for what has happened under the bank lending schemes of this Government. We have £190 billion of new credit this year, up from £179 billion last year. That is a huge increase. There is £76 billion for small and medium-sized enterprises, up 15% on last year. We are seeing more bank lending under this Government, but we are seeing also the bank levy, so people in the banks are helping to pay to deal with the deficit that his Government created.

[Edward Miliband]

A totally hopeless answer. One of his own schemes, the business growth fund—they trumpeted the announcements, and they have not got a clue what is happening to their own scheme.

Businesses are struggling, but one group in our economy is doing very well, indeed. Over the past year, when many people have seen their wages frozen, directors’ pay has risen by 49%. The Prime Minister expressed concern about that last Friday, but the public want to know: what is he going to do about it?

[The Prime Minister]

Let me tell you exactly what we are doing about it, and will do about it. It is this Government who introduced the bank levy—more raised in one year than the bonus tax that the previous Government created; it is this Government who have increased the fees that non-doms have to pay; it is this Government who have had an agreement with Switzerland and Liechtenstein to get hold of people who put money overseas; and it is this Government who have actually seen lower bank bonuses. But, where I agree with the right hon. Gentleman is that I think the Archbishop of Canterbury speaks, frankly, for the whole country when he says that it is unacceptable in a time of difficulty when people at the top of our society are not showing signs of responsibility. It is this Government who are consulting on proper measures to make sure we get transparency in terms of boardroom pay, proper accountability and more power for shareholders. All those things we are doing, and I have to ask the right hon. Gentleman, if he is so keen on this agenda, what did he do for the past 13 years?

[Edward Miliband]

I will tell you what we did, Mr Speaker. We introduced the 50p rate of income tax that the Prime Minister and his Chancellor want to abolish, but I am glad that we agree that something needs to be done about top pay. Now, last—[Interruption.] Conservative Members should just calm down. Follow the Prime Minister’s advice: just calm down. Last March, his fair pay review, which he set up, recommended that the Government require by January 2012—so January next year—that every top company publish how much the highest earners get paid compared with the average earner. That type of transparency is the least we should expect. Can he confirm that this will happen from January 2012? Yes or no?

[The Prime Minister]

What the right hon. Gentleman will know is that unlike the previous Government, who did absolutely nothing, we are consulting on a whole series of steps to bring responsibility to the boardroom. I have to say that we are a little wary about accepting lectures from a party that told us it was intensely relaxed about everyone getting filthy rich—a party that had a capital gains tax system so that people in the City paid less tax than their cleaner. I know he has forgotten all these things but we remember them and we have done something about it.

[Edward Miliband]

Another report to Government; another failure to act. The truth is that the Prime Minister has sat on Will Hutton’s review for the past nine months and has done nothing about it. That is why the recommendation is not going to be implemented. That is the truth about this Prime Minister: he says we are all in it together but he lets the top 1% get away with it while the other 99% see their living standards squeezed and lose their jobs. That is why people are increasingly saying that this is a Prime Minister who is totally out of touch with their lives.

[The Prime Minister]

I have to say that in the week when the Labour party has hired a former tax exile to run their election campaign, the right hon. Gentleman has got a bit of nerve to come and lecture us on that. Labour had 13 years to regulate the banks but did nothing. It had 13 years to deal with bank bonuses but did nothing. Now it is in opposition, its message to business is, “Give us some money—you can run our election.”

[Jason McCartney (Colne Valley) (Con)]

Q2. Cable theft has cost the rail industry £43 million in the past three years and Gurkhas have even been drafted in to patrol the network. Meanwhile, homes and churches are having their lead and copper pilfered and, in the past month, one churchyard in Huddersfield has had 169 memorial plaques stolen for their metal. Will the Prime Minister join me in saying that now is the time to legislate to stop those stolen metals going to merchants?

[The Prime Minister]

My hon. Friend makes an extremely important point. The theft of metal, particularly from war memorials, is an absolutely sickening and disgusting crime. We are working with the Association of Chief Police Officers to put in place an action plan to deal with this, which will involve looking again at the whole regulation of scrap metal dealers. We are determined to do that to put a stop to this appalling crime.

[Mr Nigel Dodds (Belfast North) (DUP)]

People in my constituency and right across the country are desperately worried about the increasing cost of gas, electricity and home heating oil and about how they are going to keep their home warm this winter. What more can the Prime Minister tell the country he is going to do to help people in that situation? In particular, will he reverse the cuts to winter fuel allowance that hit senior citizens? Surely, it is not good enough simply to say that he is following the Opposition’s plans—he has done so many things differently from the Opposition, so why does he not do something different on the winter fuel allowance?

[The Prime Minister]

On the winter fuel allowance we have kept the plans that were set out by the previous Government and I think that is the right thing to do. On the cold weather payments, we have taken the increase that was meant for one year and maintained it, so if there is a particularly cold winter, people will be getting that help. The other step we are taking is making sure that energy companies give people proper information about the lowest tariffs they can get and that we have proper reform of the energy market—something that the Labour party has now suddenly started to talk about but did absolutely nothing about in government.

[Alun Cairns (Vale of Glamorgan) (Con)]

Q3. Public sector pension reform should be achieved through negotiation and compromise. Does the Prime Minister agree that it is wholly irresponsible and downright destructive for senior politicians of any political party to support strike action while negotiations are ongoing?

[The Prime Minister]

I think my hon. Friend is entirely right. It is a very fair offer to hard-working public servants to say, “This is a strong set of pension reforms that will give you pensions that are still better than anything available in the private sector.” Frankly, to have a Labour Front-Bench team who are silent on this issue, with their education spokesman actually encouraging teachers to strike, is the height of irresponsibility.

[Susan Elan Jones (Clwyd South) (Lab)]

Q4. My constituents Alan and Linda Eastwood have a son who has been serving in our nation’s armed forces in Afghanistan. In common with the Royal British Legion, Mr and Mrs Eastwood regard the Prime Minister’s decision to abolish the post of chief coroner as a betrayal. Will the Prime Minister tell us why he thinks he is right on this issue and the Royal British Legion is wrong?

[The Prime Minister]

This is a very important issue, and I have had discussions with the Royal British Legion about it, as has my right hon. and learned Friend the Lord Chancellor. The point about it is that the current proposal for the office of chief coroner to be established would involve something like £10 million of spending, and we think the money would be better spent on improving all coroners’ services across the country. We are listening very carefully to the concerns expressed in both Houses of Parliament about this issue, but what really matters is: are we going to improve the performance of our coroners? That is what service families want; that is what I want; and that is what we will deliver.

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

Q5. Public sector workers in my constituency work extremely hard to deliver essential public services, and I know that my right hon. Friend agrees that we value those services tremendously. Will he reassure those workers and confirm that the Government’s reforms—very necessary reforms that they are—will ensure that those services are sustainable and remain among the very best?

[The Prime Minister]

I will certainly do that. My hon. Friend makes an important point. The cost of supporting public sector pensions has gone up by one third in the last decade, and we are now spending something like £32 billion. They are a major item of public spending, and obviously we are taking taxes off people, including those in the private sector who have less good pensions, to pay for that pension provision.

I believe that our scheme is fair. For example, a teacher retiring on a salary of £37,000 after a full career would retire on a pension of £25,000 in future. That is more than the £19,000 that they would currently get. This is a fair set of changes. The less well-off are really protected, and the low paid in the public sector will not have to pay the increased contributions. Frankly, I think the whole House of Commons should get behind them instead of playing with strike action like the Labour party.

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

When the Prime Minister goes to the G20 meeting over the next couple of days, will he try to persuade his colleagues of the urgency of coming up with some detail on the eurozone settlement reached last week? It is not at all clear how on earth Greece will get out of its difficulties, even if the referendum passes. European banks will need shoring up well before next summer, and as for the new rescue fund, which may be needed sooner than we think, it does not actually exist. Will he accept that the G20 now needs to show the same urgency and sense of purpose that it showed two years ago when it met in London? Otherwise, far from getting ahead of events, Governments will be condemned to being dragged along in their wake.

[The Prime Minister]

The right hon. Gentleman is absolutely right in what he says about the urgency of the G20 meeting, and the necessity of its agenda. I think some progress was made at the European Council meeting a week ago when, for the first time, it accepted a proper write-down of Greek debt, which must be part of the solution, and a proper recapitalisation of Europe’s banks done to a credible test, rather than the incredible test we have had in months gone by.

The final element that the right hon. Gentleman rightly refers to—and which needs to have more detail and substance added—is to make sure there is a proper firewall to stop contagion in the eurozone. The need has become even greater. Frankly, of course we cannot involve ourselves in Greek domestic politics, but it has become even more urgent to put meat on the bones of these plans to show that we are removing one of the key obstacles to global growth, which is the failure to agree a proper plan to deal with problems in the eurozone.

[Mr Philip Hollobone (Kettering) (Con)]

Q6. According to the Government’s own projections, Britain’s population is set to increase from 62 million today to 70 million by 2027, with two thirds of that increase being driven by immigration. Will the Prime Minister give a commitment to stem that increase by breaking the almost automatic link between foreign nationals who come to work here subsequently being granted citizenship?

[The Prime Minister]

We are committed to doing exactly that, and my hon. Friend is right to raise this issue. I think that proper immigration control and welfare reform are two sides of the same coin, and this Government are committed to controlling immigration properly, but also to putting British people back to work. The two work together.

Today, we have announced that, in terms of the illegal immigration that comes through the student route, more than 450 colleges will no longer be able to sponsor new international students, because they were not properly established to do that. Those colleges could have brought in more than 11,000 students to the UK to study each year. That is just one example of how this Government are living up to their promise to get a grip on immigration.

[Alex Cunningham (Stockton North) (Lab)]

Q7. Does the Prime Minister agree with the vast majority of people that smoking should be banned in vehicles when children are present, and will he encourage the Government to adopt the contents of my ten-minute rule Bill, which aims to put an end to it?

[The Prime Minister]

I do think the smoking ban is right. I have to admit, as a former smoker, and someone who believes strongly in liberties and who did not support it at the time, that the smoking ban has worked, and I think it is successful. I am much more nervous about going into what people do inside a vehicle. I will look carefully at what the hon. Gentleman says, but we have to have a serious think before we take that step.

[Mike Crockart (Edinburgh West) (LD)]

The Prime Minister will be aware of Citigroup’s report, issued yesterday, on green energy investment in Scotland. Does he agree that this report very ably demonstrates that the benefits of green energy in the UK are unlocked only by combining Scotland’s renewable potential with the large-scale investment made possible by the UK; and does he agree that a drawn-out independence referendum is a serious distraction from that?

[The Prime Minister]

My hon. Friend makes an important point. In fact, a major financial institution warned yesterday of the dangers of investing in Scotland while there is this uncertainty about the future of the constitution under way. I think it is very important that we keep our United Kingdom together and we stress that when it comes to vital industries like green technology, the combination of a green investment bank sponsored by the United Kingdom Government and the many natural advantages that there are in Scotland can make this a great industry for people in Scotland—but we will do that only if we keep our country together.

[Dr Alan Whitehead (Southampton, Test) (Lab)]

Q8. Just after the election, the Prime Minister said that his Government would be the greenest ever. Does he still take that statement seriously? If he does, will he personally intervene to sort out the appalling chaos that is resulting from the slashing, in six weeks’ time, of feed-in tariffs for solar PV, leading to substantial job losses, chaos in the solar PV industry, and devastation for hundreds of community renewables projects?

[The Prime Minister]

It is this Government who set aside £3 billion for a green investment bank, much talked about in the past but never done. It is this Government who have put in place a carbon price floor—one of the first Governments anywhere in the world to do so. It is we who put aside £1 billion for carbon capture and storage. So this is a very green Government living up to our promises—absolutely right.

[Jonathan Evans (Cardiff North) (Con)]

Q9. Will the Prime Minister join me in congratulating the pupils and staff at Whitchurch high school, a foundation-status comprehensive school in my constituency? It is the former school of Sam Warburton, the outstanding Welsh rugby captain; Gareth Bale, the impressive footballer at Spurs and Wales; and Geraint Thomas, the gold medallist. It will be receiving the award for state school of the year for sports—

[Mr Speaker]

Order. We get the drift of the hon. Gentleman’s question.

[The Prime Minister]

I have to say that that is a very impressive list of sports personalities who have attended this school; I do not know what they put in the water, but I think we would probably all like to have some. I certainly join my hon. Friend in congratulating such an excellent school.

[Katy Clark (North Ayrshire and Arran) (Lab)]

In the past four years, six children and two adults have been killed in dog attacks, and some 6,000 postal workers are attacked each year. There is cross-party agreement that we need to tighten up the law in this area. Will the Prime Minister take a personal interest and make sure that legislation is brought forward as soon as possible?

[The Prime Minister]

The hon. Lady makes an important point. Legislative attempts at this in the past have not always been successful and have not always captured the breeds that need to be captured, so I will certainly take a personal interest, and perhaps I can write to the hon. Lady and set out what the Government intend to do.

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

Q10. Following the Prime Minister’s answers a moment ago, and given the huge anger about the pay for the top 100 directors, can he give me a personal assurance that he is committed to the transfer of power over pay from the boardroom to the shareholders of our companies?

[The Prime Minister]

I do want to see that happen. The answer to this is much more transparency about the levels of pay, much more accountability, and strengthening the hand of shareholders. There is something else we need to do, which is to make sure that non-executive directors on boards are not the usual sort of rotating list of men patting each other’s backs and increasing the level of remuneration. I want to see more women in Britain’s boardrooms, which I think would have a thoroughly good influence.

[Mr David Lammy (Tottenham) (Lab)]

Q11. The—[Interruption.]

[Mr Lammy]

The Prime Minister has described his Work programme as the biggest back-to-work programme since the 1930s, but he knows that it does not create jobs—it merely links people to vacancies. In Tottenham, there are 6,500 people unemployed, 28,000 people on out-of-work benefits, and only 150 vacancies. What is his Work programme going to do about that?

[The Prime Minister]

As the right hon. Gentleman says, the Work programme plays a key role in helping to prepare people for work. That is absolutely vital. It also brings employers in, so that they can offer jobs to those people. I have looked specifically at the issue of Tottenham, because I know from when I visited his constituency with him that, yes of course, there is a shortage of vacancies in the borough of Tottenham itself, but we have to encourage people who live in London to be prepared to travel more widely to look for work. That is absolutely vital, and part of the Work programme should be aimed at addressing exactly that.

[Mr Graham Stuart (Beverley and Holderness) (Con)]

Rural fire services attend more primary fires and more road traffic accidents than do those in urban areas, yet they receive less funding. This is typical of rural services across the piece, with residents paying more and receiving less. Will the Prime Minister meet me and a group of other MPs from across the House who represent rural areas, to discuss getting a fairer deal for those in rural areas, particularly the rural poor?

[The Prime Minister]

I am very happy to meet my hon. Friend. It is important that we have a fair deal for rural areas. There are obviously very big differences, particularly in the use of retained firefighters, but I am happy to meet him to discuss the issue.

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

Q12. The Prime Minister knows, thanks to the Leader of the Opposition, that in nine months, the Government’s business growth fund has invested in precisely two companies. At a time when the economy is flatlining, is that good enough?

[The Prime Minister]

What this Government have done is cut corporation tax for every business in the country. We have introduced enterprise zones to help employment, and increased the number of apprenticeships by 250,000 over the life of this Parliament. The Opposition criticise the regional growth fund, but there was no regional growth fund under Labour. That is the point. Let me just remind them that we inherited an economy with the biggest budget deficit in Europe, and it is this Government who are helping our economy through the international storms to ensure that we remain safe in the UK.

[Jessica Lee (Erewash) (Con)]

This week is national adoption week. Does my right hon. Friend agree that we must continue to do all that we can to support children in the care system, and to encourage prospective adoptive parents to come forward?

[The Prime Minister]

My hon. Friend makes an extremely important point. In national adoption week, we really need more parents to come forward as potential adopters and potential foster carers, because there is a huge build-up of children in the care system who will not get that help unless people come forward. It is also important that the Government pledge that we will make the process of adoption and fostering simpler. It has become too bureaucratic and difficult, and the result is that it is putting people off. I am absolutely determined that we crack this. It is a matter of national shame that, while there are 3,660 children under the age of one in the care system, there were only 60 adoptions last year. We are now publishing information on every single council, so that people can see how we are doing in terms of driving this vital agenda.

[Thomas Docherty (Dunfermline and West Fife) (Lab)]

Q13. This week, yet another military academic has called for the reopening of the defence review, and a leading military think-tank has said: “Britain is now cutting military equipment that might prove vital in future.”Will the Prime Minister finally listen to the voices of the defence community and reopen his deeply flawed defence review?

[The Prime Minister]

We had no defence review for 10 years, and now the Opposition want two in one go. That is absolutely typical of the opportunism of the Labour party. This is a day, as hostilities in Libya are coming to an end, on which we should be praising our armed services and all that they have done.

[Guy Opperman (Hexham) (Con)]

Q14. Schools in rural Northumberland were largely ignored by the previous Government. With the schools budget rising from £35 billion to £39 billion in 2015, will the Prime Minister welcome the finance bid put forward by Prudhoe community high school in my constituency?

[The Prime Minister]

I will certainly welcome that bid. It is important to note that, because we are protecting the per-pupil funding, even at a difficult time for the economy and public spending, the education budget will be rising and not falling—[Interruption.] As ever, the shadow Chancellor is wrong, even when he is sitting down. He talks even more rubbish when he stands up. I digress. As well as the extra investment in the schools budget, there is also the opportunity for free schools, which I think are going to be a major reform in our country, to bring in more good school places. Perhaps when a future shadow Chancellor attends one of those schools, he will learn a few manners. [Interruption.]

[Mr Speaker]

Order. Some people are going to burst they are getting so excited, which is a bit of a shame—and a bit of a problem for them.

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

Will the Prime Minister listen to both the campaigners outside Parliament today and the 80,000 people who have written to him in recent weeks, and commit to becoming a leading advocate for the introduction of a Robin Hood tax at the G20 summit later this week? Will he ensure that the revenue is earmarked to tackle sustainable development and the growing climate crisis?

[The Prime Minister]

As the hon. Lady knows, there is widespread support for the principles behind such a tax, but it must be adopted on a global basis. Let me say this as quite an important warning to those who are pushing so hard for such a tax: we must be careful that we do not allow other countries, including some European countries, to use a campaign for the tax, which they know is unlikely to be adopted in the short term, as an excuse for getting out of their aid commitments. The House and the country can be proud of the fact that we are meeting our aid commitments. Do not let others use the tax as a way getting out of things that they promised.

[Tim Farron (Westmorland and Lonsdale) (LD)]

Q15. The world population passed 7 billion this week. That is an awful lot of mouths to feed. In addition, the UN predicts that over the next 40 years, world demand for food will increase by 70%. That ought to be good news for farmers, but sadly, since 1990, Britain’s capacity to feed itself has fallen by a fifth. Does the Prime Minister agree that that is a disastrous situation, and will he urgently introduce a credible strategy to grow Britain’s farming industry to feed us all in future?

[The Prime Minister]

My hon. Friend makes an important point. It is true that we have seen our food security decline and our food production severely challenged over the past 10 years. It is important to remember that farmers are businesses. They need things done like other businesses do on deregulation, predictable income and all those things. This Government are committed to making that happen, which will benefit particularly people in my hon. Friend’s constituency.

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

On 13 September 2010 at the Select Committee on Communities and Local Government, when asked whether success for this Government will mean building more homes per year than were being built prior to the recession, the Minister for Housing and Local Government replied:

“Yes. Building more homes is the gold standard upon which we shall be judged.”

In which year or years of this Parliament does the Prime Minister expect that gold standard to be achieved?

[The Prime Minister]

What we have said is that we are going to expand the building of homes for social rent by increasing and reintroducing the right to buy, which the previous Government so scandalously ran down. That will help. We will also make available Government land, so that builders can get on and build without having to buy that land. They will have to pay only when they have actually delivered the house. We want to see an extra 200,000 homes built in that way, which will give us a far better record than that of the Government whom the hon. Gentleman represented.

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

Notwithstanding the increasingly maniacal gesticulations of the shadow Chancellor, is it not remarkable that in the middle of the world’s biggest crisis, Britain is able to borrow at lower rates of interest than almost any other country in the world?

[The Prime Minister]

As ever, it takes the Father of the House to bring the wisdom to the table, which is that if we did not have a proper plan for getting on top of our debts and our deficit, we would not have 2.5% interest rates, which are the greatest stimulus our economy could have. Instead, we would have interest rates like those of the Greeks, the Spanish and the Italians, and our economy would be hit. Do you know how you get interest rates like that? You get them if you adopt the plans of the Labour party. Its plan is for an extra £87 billion of borrowing over this Parliament. You do not solve a debt crisis by adding to your debts—[Interruption.] The shadow Chancellor can go on making his rather questionable salutes, but it is time for him to take a primer.

[Mr Speaker]

Order. I appeal to right hon. and hon. Members who are leaving the Chamber, who unaccountably do not wish to remain for the statement, to do so quickly and quietly, so that the rest of us can listen attentively to the Chief Secretary.

Commonwealth Heads of Government Meeting

Lord Cameron of Chipping Norton Excerpts

Monday 31st October 2011 Written Statements

[The Prime Minister (Mr David Cameron)]

I attended the Commonwealth Heads of Government meeting in Perth, Australia, which took place from 28 to 30 October. The Secretary of State for Foreign and Commonwealth Affairs and the Ministers of State (Lord Howell and Lord Green) also attended.

Her Majesty the Queen opened the meeting in her role as Head of the Commonwealth.

The Government believe strongly in the relevance of the Commonwealth and its networks, and the role that it can play in global issues of the day. It is unique in that it brings together a diverse range of countries, economies, and a predominantly young population looking to the future. In our programme for government, we expressed commitment to strengthen the Commonwealth to promote democratic values, development and prosperity.

The UK strongly supported the work of the eminent persons group (EPG) and the Commonwealth ministerial action group (CMAG) to make the Commonwealth more effective. Leaders adopted a series of reforms, the most significant in recent Commonwealth history, to ensure the organisation can better protect its core democratic values, and retain its credibility on the global stage. This included agreement on CMAG reform and to have a Commonwealth charter. Thirty of the 106 recommendations of the EPG were adopted at Perth. Discussions of the others will continue, and Foreign Ministers will meet again during 2012 to conclude these discussions.

Leaders welcomed Rwanda to its first summit as a full Commonwealth member and noted South Sudan’s application for membership. Ongoing interest in membership further demonstrates the continued relevance of the Commonwealth and its role supporting democratic development in members and applicant countries. In this regard, leaders urged the interim Government of Fiji, currently suspended from the Commonwealth, to restore democracy without further delay, respect human rights and uphold the rule of law. Leaders also looked forward to the conditions being created for the return of Zimbabwe to the Commonwealth and encouraged the parties to implement the global political agreement faithfully and effectively.

Leaders noted the threat that climate change poses to security, prosperity, and economic and social development and committed to advocacy leading to legally binding outcomes at the UNFCCC conference in Durban and beyond. They also urged the G20 to take the necessary steps to address current economic instability and to take concrete steps to put open trade, jobs, social protection and economic development at the heart of the recovery.

To mark Her Majesty’s diamond jubilee, and as a gift to the Commonwealth people, Leaders welcomed the establishment of a Queen Elizabeth diamond jubilee trust. This will support charitable projects and organisations across the Commonwealth, focusing on areas such as tackling curable diseases, promotion of all forms of education and culture, and other Commonwealth priorities. It will be funded by private donations and voluntary contributions from Governments.

To strengthen the Commonwealth’s ability to meet the development needs of member states, leaders agreed the Perth declaration on food security principles and discussed the inherent development challenges facing small, vulnerable states.



I believe that the outcomes achieved in Perth will help reinvigorate this unique organisation. The Commonwealth can help contribute to the UK’s foreign policy and trade objectives not just through the intergovernmental links, but also through its networks of civil society and professional associations. The Secretary of State for Foreign and Commonwealth Affairs, in a speech to the Commonwealth people’s forum, made clear the UK’s desire to see homosexuality decriminalised and the death penalty abolished across the Commonwealth. Lord Howell and Lord Green both addressed the biggest Commonwealth business forum to date, which will lead to increased intra-Commonwealth trade, and trade with the UK. Ministers also engaged with participants of the Commonwealth youth forum—tomorrow’s leaders and the future of the Commonwealth.

Leaders noted the decision made in 2009 that Sri Lanka would host the 2013 summit, Mauritius in 2015, and welcomed Malaysia’s bid to host in 2019. As host of CHOGM, we shall look to Sri Lanka to demonstrate its commitment to upholding Commonwealth values of good governance and human rights. A key part of this will be addressing long standing issues around accountability and reconciliation after the war.

Copies of the concluding communiqué and the reports of the eminent persons group and the Commonwealth ministerial action group have been placed in the Libraries of both Houses.

Separately at Perth, the 16 Commonwealth realms agreed in principle that we should modernise the Act of Settlement with regard to the rules of royal succession. This will set in motion a historic process to end the system of male preference primogeniture and the provision that anyone who marries a Roman Catholic would be ineligible to succeed to the Crown. A copy of the agreed wording will also be placed in the Libraries.

European Council

Lord Cameron of Chipping Norton Excerpts

Monday 24th October 2011 Commons Chamber

[The Prime Minister (Mr David Cameron)]

With permission, Mr Speaker, I would like to make a statement on recent developments in Libya and yesterday’s European Council.

Yesterday in Libya, after 42 years of tyranny and seven months of fighting, the national transitional council declared the formal liberation of their country. Everyone will have been moved by the pictures of joy and relief that we saw on our television screens last night. From Tripoli to Benghazi, from Misrata to Zawiyah, Libyans now dare to look forward, safe in the knowledge that the Gaddafi era is truly behind them.

This was Libya’s revolution, but Britain can be proud of the role that we played. Our aim throughout has been to fulfil the terms of the UN Security Council resolution, to protect civilians, and to give the Libyan people the chance to determine their own political future. With the death of Gaddafi, they now really do have that chance. The whole House will join me in paying tribute to our armed forces for the role that they have played—over 3,000 missions flown and some 2,000 strike sorties, one fifth of the total strike sorties flown by NATO. As the Chief of the Defence Staff has written this morning, it has been

“one of the most successful operations NATO has conducted in its 62-year history”.

I believe it is something the whole country can take pride in.

The decision to intervene militarily, to place our brave servicemen and women in the line of fire, is never an easy one. We were determined from the outset to conduct this campaign in the right way, and to learn the lessons of recent interventions, so we made sure the House was provided immediately with a summary of the legal advice authorising the action. We held a debate and a vote in Parliament at the earliest opportunity. We made sure that decisions were taken properly throughout the campaign, with the right people present, and in an orderly way. The National Security Council on Libya met 68 times, formulated our policy, and drove forward the military and the diplomatic campaign. We took great care to ensure that targeting decisions minimised the number of civilian casualties. I want to pay tribute to my right hon. Friend the Member for North Somerset (Dr Fox) for his hard work on this issue.

It is a mark of the skill of RAF, British Army and other coalition pilots that the number of civilian casualties of the air attacks has been so low. The military mission is now coming to an end, and in the next few days, NATO’s Operation Unified Protector will formally be concluded. It will now be for Libyans to chart their own destiny and this country will stand ready to support them as they do so.

Many learned commentators have written about the lessons that can be learned from the past seven months. For our part, the Government are conducting a rapid exercise, while memories are still fresh, and we will publish its key findings. For my part, I am wary of drawing some grand, over-arching lesson—still less to claim that Libya offers some new template that we can apply the world over. I believe it has shown the importance of weighing each situation on its merits and thinking through carefully any decision to intervene in advance. But I hope it has also shown that this country has learned not only the lessons of Iraq, but the lessons of Bosnia too. When it is necessary, legal and right to act, we should be ready to do so.

Let me turn to yesterday’s European Council. This Council was about three things: sorting out the problems of the eurozone, promoting growth in the European Union, and ensuring that as the eurozone develops new arrangements for governance, the interests of those outside the eurozone are protected. This latter point touches directly on the debate in the House later today, and I will say a word on this later in my statement. Resolving the problems in the eurozone is the urgent and overriding priority facing not only the eurozone members, but the EU as a whole and indeed the rest of the world economy.

Britain is playing a positive role proposing the three vital steps needed to deal with the crisis: the establishment of a financial firewall big enough to contain any contagion; the credible recapitalisation of European banks; and a decisive solution to the problems in Greece. We pushed this in the letter we co-ordinated to the G20 and in the video conference between me, Angela Merkel, Nicolas Sarkozy and President Obama last week. We did so again at the European Council this weekend and will continue to do so on Wednesday at an extra European Council meeting.

Ultimately, however, the way to make the whole of the EU, including the eurozone, work better is to promote open markets, flexible economies and enterprise. That is an agenda that Britain has promoted, under successive Governments and successive Prime Ministers, but it is now an agenda that the European Commission is promoting, too. We have many differences with the European Commission, but the presentation made by the Commission at yesterday’s Council about economic growth was exactly what we have been pushing for, driving home the importance of creating a single market in services, opening up our energy markets and scrapping the rules and bureaucracy that make it take so long to start a new business. Both coalition parties are pushing hard for these objectives.

This may sound dry, but if we want to get Europe’s economies moving and to succeed in a competitive world, these are the steps that are absolutely necessary. These are arguments that Margaret Thatcher made to drive through the single market in the first place, and which every Prime Minister since has tried to push. If the countries of the EU were as productive as the United States, if we had the same proportion of women participating in our economy, and if we were as fast and flexible at setting up new businesses, we would have the same GDP per capita as the United States. That is an aim we should adopt.

The remainder of the Council was spent on the safeguards needed to protect the interests of all 27 members of the European Union. The Council agreed that all matters relating to the single market must remain decisions for all 27 member states and that the European Commission must

“safeguard a level playing field among all Member States including those not participating in the Euro.”

That leads me directly to the debate we will have in the House later today. Members of my party fought the last election committed to three things: stopping the passage of further powers to the EU; instituting a referendum lock to require a referendum, by law, for any such transfer of powers from this House; and bringing back powers from Brussels to Westminster. All three remain party policy. All three, in my view, are in the national interest. In 17 months in government, we have already achieved two of the three. No more powers have gone to Brussels. Indeed, the bail-out power has actually been returned and, of course, the referendum lock is in place. I remain firmly committed to achieving the third: bringing back more powers from Brussels.

The question tonight is whether to add to that by passing legislation in the next Session of this Parliament to provide for a referendum that would include a question on whether Britain should leave the EU altogether. Let me say why I continue to believe that this approach would not be right, why the timing is wrong and how Britain can now best advance our national interests in Europe.

First, it is not right because our national interest is to be in the EU, helping to determine the rules governing the single market, our biggest export market, which consumes more than 50% of our exports and drives so much investment in the UK. That is not an abstract, theoretical argument; it matters for millions of jobs and millions of families and businesses in our country. That is why successive Prime Ministers have advocated our membership of the EU.

Secondly, it is not the right time, at this moment of economic crisis, to launch legislation that includes an in/out referendum. When your neighbour’s house is on fire, your first impulse should be to help put out the flames, not least to stop them reaching your own house. This is not the time to argue about walking away, not just for their sakes, but for ours.

Thirdly, and crucially, there is a danger that by raising the prospect of a referendum, including an in/out option, we will miss the real opportunity to further our national interest. Fundamental questions are being asked about the future of the eurozone and, therefore, the shape of the EU itself. Opportunities to advance our national interest are clearly becoming apparent. We should focus on how to make the most of this, rather than pursuing a parliamentary process for a multiple-choice referendum. As yesterday’s Council conclusions made clear, changes to the EU treaties need the agreement of all 27 member states. Every country can wield a veto until its needs are met. I share the yearning for fundamental reform and am determined to deliver it.

To those who support today’s motion but do not actually want to leave the EU, I say this: I respect your views. We disagree not about ends, but about means. I support your aims. Like you, I want to see fundamental reform. Like you, I want to re-fashion our membership of the EU so that it better serves our nation’s interests. The time for reform is coming. That is the prize. Let us not be distracted from seizing it. I commend this statement to the House.

[Edward Miliband (Doncaster North) (Lab)]

I thank the Prime Minister for his statement. On Libya, I join him in expressing deep and abiding gratitude to members of the British armed forces. Over the past seven months, once again, our servicemen and women have been a credit to our nation, exercising our responsibility to the Libyan people and to uphold the will of the United Nations. That is why I have supported the Government in their actions, and I commend the Prime Minister on the role that he has played in taking the right and principled decisions on the issue.

There are difficult days ahead, and it is for the Libyan people to determine their future, but I agree with the Prime Minister that, alongside the responsibility to protect, which we exercised, is the responsibility to help rebuild—in particular, to help provide the expertise that the new Libya will require.

Let me now turn to Europe, and here my opening remarks reflect some of the things that the Prime Minister said. We are clear, and have been consistently, that getting out of the European Union is not in our national interest. Cutting ourselves off from our biggest export market makes no sense for Britain, and the overwhelming majority of British businesses, however unhappy they are with aspects of the EU, know that, too.

What is more, at this moment of all moments, the uncertainty that would ensue from Britain turning inwards over the next two years to debate an in/out referendum is something our country cannot afford. The best answer to the concerns of the British people about the European Union is to reform the way it works, not to leave it. We should make the completion of the single market, common agricultural policy reform, budget reform and reform of state aids the issue. That is why we will vote against the motion tonight.

This is the context for the European Council that the Prime Minister went to this weekend: growth stalled in Britain since the autumn; growth now stalling in Europe; unemployment rising; and the threat of a new banking crisis. That is why yesterday’s summit was so important.

I listened carefully to the Prime Minister’s statement, and it sounds like he now believes that Britain should play an active role in solving this crisis, but the truth is that month after month the Prime Minister and the Chancellor have chosen to grandstand on the sidelines, not to help sort out the issue. The Chancellor even refused to go to the initial meetings that he was invited to on the issue. They have shown no will to try to find the solutions.

Let me ask where the Prime Minister now stands. On banking, does he believe that the amount of recapitalisation being discussed is sufficient to ensure financial stability throughout the European banking system, particularly in the light of the International Monetary Fund’s larger estimates of capital required? On Greece, does he believe that the lessons of previously announced Greek bail-outs are being learned and will provide a genuinely sustainable solution? On growth, does he now understand that Europe will not get to grips with its debt problems until it gets to grips with a crisis of growth and the immediate lack of demand in the European economy?

I suppose we should be pleased that the Government have moved from the Chancellor being empty-chaired at the meetings to the Prime Minister at least wanting to get into them, but he will have to do better than yesterday, because he was surprisingly coy about his one real achievement at the summit. In a few short hours, he managed to write the euro version of “How to Lose Friends & Alienate People”. He went into the summit lecturing the Germans; he came out of it being shouted at by the French. Apparently, President Sarkozy, until recently his new best friend, had had enough of the posturing, the hectoring, the know-it-all ways. Mr President, yesterday you spoke not just for France but for Britain as well.

The Prime Minister was in Brussels, but his mind was elsewhere. The Tory party on Europe is suffering another nervous breakdown, with a Prime Minister making frantic phone calls home, Parliamentary Private Secretaries threatening to resign, and it is not just the Stone Roses on a comeback tour, because the right hon. Member for Wokingham (Mr Redwood) is back among us, touring the television studios.

All the Prime Minister’s present difficulties are of his own making. What did he say in 2006? He said that instead of talking about the things that most people care about, we were banging on about Europe. However, he spent the last five years telling his Back Benchers that he may not be banging on about Europe but that, deep down, he is really one of them. He was warned that he might start by dabbling with Euroscepticism, but that it was a slippery slope. That is exactly what happened.

Does the Prime Minister regret getting out of the European People’s Party in favour of the right-wing fringe—[Interruption.] He says no, but I do not know whether he was aware that there was a dinner for EPP leaders on Saturday night. The German Chancellor was there, the French President was there, and the President of the Commission was there—mainstream centre right Europe—but the Prime Minister was not invited. He is the person who kept telling us that he was a Eurosceptic, who at the election promised renegotiation of the terms of Britain’s membership of the EU. His party is paying the price because it believed what he told them. The country is paying the price because we are losing influence.

Yesterday, the Prime Minister was at it again, and we heard it again today. He is locked in a row with his Back Benchers, and what do we see? We see the resurrection of the old classic to get out of the social chapter, and withdraw employment rights. The coalition agreement is clear. That option is off the table. The Deputy Prime Minister is nodding from a sedentary position. That option—the third option in the Prime Minister’s statement—is off the table, and the Foreign Secretary confirmed that again this morning. Let the Prime Minister answer this question. At the December summit, what position will he take? Will he be for renegotiation or against? The coalition agreement says that that option is off the table. He said in his statement that it is on the table. The position is totally unclear.

This goes to the heart of the Prime Minister’s ability to fight in Europe on behalf of this country. Like his predecessors, he is caught between the party interest and the national interest. We see a rerun of the old movie—an out-of-touch Tory party tearing itself apart over Europe—and all the time the British people are left to worry about their jobs and livelihoods. The Prime Minister should stop negotiating with his Back Benchers, and start fighting for the national interest.

[The Prime Minister]

First, I thank the right hon. Gentleman for his kind words on Libya. I agree that, as well as the responsibility to protect, we have a responsibility to help rebuild, and we will certainly do that.

What he said about Europe started well with praise for the importance of completing the single market, something he is in favour of and I am in favour of. He did not tell us about all his views on Europe. Yesterday, he was asked repeatedly whether Labour would join the euro, and the answer was instructive. He said:

“It depends how long I’m prime minister for.”

I am not sure which prospect is more terrifying.

The right hon. Gentleman accused the Government of not going to meetings in Europe. We have been going to meetings in Europe to get us out of the bail-out mechanism that Labour put us into. He asked what we are doing to make sure that bank recapitalisation is credible. My right hon. Friend the Chancellor spent 10 hours in an ECOFIN meeting on Saturday ensuring that that happened. It would not have done without his intervention.

On Greece, we certainly want decisive action. Let me be clear about that. The right hon. Gentleman then said an extraordinary thing about the French President—that he thought the French President spoke for Britain—[Interruption.] That is what he said. It is difficult from opposition to sell out your country, but he has just done it.

I struggled to look for a question to answer—there were not very many. The right hon. Gentleman talked about the importance of global leadership. Let me just remind him that one of the absolute keys is going to be the role of the IMF. Let us remember that he led his Back Benchers and all his Front Benchers through the Division Lobby to vote against the IMF deal that his own former Prime Minister had negotiated in London. That was a complete absence of leadership, like so much we see from the right hon. Gentleman.

[Several hon. Members]

rose—

[Sir Malcolm Rifkind (Kensington) (Con)]

I agree with the Prime Minister’s view on the debate this afternoon. However, has he had drawn to his attention the terms of the third option in the motion, which is to

“re-negotiate…membership in order to create a new relationship based on trade and co-operation”?

Is that not purely the situation of Norway and Switzerland, is that not incompatible with membership of the European Union, and should not anyone who is interested in renegotiation that will enable us to stay within the Union oppose this motion?

[The Prime Minister]

I think the vital interest for the UK is belonging to the single market—not just being able to trade in that single market but having a seat at the table where you can negotiate the rules of that single market, which of course countries like Norway are not able to do. One of the other problems with the motion—I completely understand the frustrations that many of my colleagues have about Europe—is that if you have a three-way choice, you could find that 34% of the country voting to get out of the European Union would be enough to deliver that or, indeed, that 34% voting for the status quo, which many of think is unacceptable, would be enough. [Interruption.] I think we have tried the alternative vote, and a pretty clear decision was made.

[Mike Gapes (Ilford South) (Lab/Co-op)]

How would the Prime Minister characterise his relations with President Sarkozy?

[The Prime Minister]

If you have a good relationship with someone, you can have frank discussions with them. I can tell the hon. Gentleman exactly what happened at the European Council yesterday. On the issue of Libya, Britain and France have worked together probably more closely than we have worked together at any time in the last 40 years, and on defence co-operation, we will continue to do that. I do not for one minute resile from the need sometimes to speak clearly and frankly on behalf of Britain and to stand up for the British national interest. It is in our national interest that the eurozone deals with its problems, and it is right that we make that clear.

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

My right hon. Friend deserves great credit for the determination and leadership that he showed in relation to Libya. He will understand that his views and mine on Europe are hardly identical, but, at the very least, can we not agree that in opposing President Sarkozy abroad, and in opposing the motion to be discussed here at home, he is clearly acting in the national interest?

[The Prime Minister]

I am very grateful for that compliment. The fact is that my right hon. and learned Friend is right to make the point. This is a coalition. There is not complete agreement on European policy between the parties of the coalition, but the coalition came together in the national interest and is acting in the national interest, and I think it is right to oppose this motion tonight, partly on the grounds that he puts forward.

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

It is a shame that the Prime Minister spent only 10 minutes on Libya, the European Council and the motion. On reflection, I hope that he will think that he should have paid more attention to the European Council.

US Secretary Geithner said that even if all Greece’s debts were repaid, we would still have the same problem. Could the Prime Minister tell the House how he thinks that Greece will regain competitiveness?

[The Prime Minister]

I have probably made more statements on European Councils over the last 16 months than many Prime Ministers, and I have always committed to come back and report to the House.

The point that the hon. Lady makes is absolutely right. Greece is just the most glaring problem that the eurozone has to deal with. As I have said, that has to be dealt with decisively. It needs to be backed by a firewall, and it needs to be backed by the recapitalisation of banks. But the fundamental problem of the eurozone is the issue of competitiveness and the very large current imbalances that are building up in some of the member states, particularly those in the south. As a result, what needs to happen above all, as I said in my statement, is an advance in competitiveness, in trade, and in completing the single market, which will help all those economies in the longer term.

[Mr William Cash (Stone) (Con)]

The Prime Minister has made it clear that he advocates fiscal union within the eurozone. Can he explain to the House how it is that fiscal union of that kind is not a fundamental change in our relationship with the European Union, bearing in mind that it is established that the constitutional position is clear that where there is fundamental change, there must be a referendum? How can he square that circle?

[The Prime Minister]

Let me be clear with my hon. Friend. I think that fundamental changes are coming in Europe; they are clearly coming in the eurozone. That may lead to pressures, as we saw over the weekend, for treaty change. That will present opportunities for Britain and we should respond to those opportunities. The question for the House tonight is whether it is right to go off down the path of having a referendum that includes an in/out option, just when there are big opportunities as the eurozone and the EU are changing.

[Keith Vaz (Leicester East) (Lab)]

I join others in congratulating the Prime Minister on his stance on Libya, but remind him that there are other countries, such as Yemen, that need to be focused on. The Lisbon agenda set out the benchmarks for economic growth, which were replaced by the 2020 strategy. Is the Prime Minister confident that, despite the eurozone crisis, those targets will be achieved?

[The Prime Minister]

First, the right hon. Gentleman is right on Yemen. As he knows, the National Security Council is spending an increasing amount of time on examining how we can best help that country not only to achieve a transition to greater democracy and freedom, but to tackle the security concerns that we have about it. He is right that we have had the Lisbon process and the 2020 process. The problem is that although this agenda gets pushed forward, in too many cases the targets and measures are not met. After 16 or 17 months of going to Council meetings, I am seeing a change of heart in the European Commission, not least because everyone recognises that the priority in Europe is now growth. The Commission has to stop adding expensive regulations to business and start deregulating, which is exactly the agenda that we are putting forward.

[Richard Ottaway (Croydon South) (Con)]

Does the Prime Minister agree that not only in Libya, but in Tunisia and Egypt there is an opportunity for reconstruction and a transition to democracy? To what extent will that be dealt with on a bilateral basis or in conjunction with our partners through the European External Action Service?

[The Prime Minister]

The first thing that we have done is to help to change the European neighbourhood policy to ensure that it is much more engaged with Libya, Tunisia and Egypt, and to put in much more conditionality so that there is progress towards rights and democracy in the countries that we are helping. In addition, we have a significant bilateral programme. It is essential to help those countries develop the building blocks of democracy, such as political parties, and understand the importance of civic society. The Department for International Development and others can help with that.

[Mr Nigel Dodds (Belfast North) (DUP)]

I join others in paying tribute to the bravery of our servicemen and women over Libya and to the work of NATO. I particularly commend the Prime Minister for his leadership on Libya. I am afraid that on Europe, the same cannot be said. The people of Britain will today be asking why he has he decided to firmly set his face not only against his own Back Benchers, but against the settled will of the British people for a referendum on Europe.

[The Prime Minister]

First, I thank the right hon. Gentleman for what he said about Libya. As I have said, the country can be proud of what our armed service personnel have done. On Europe, I am clear about what Parliament should do about a referendum. We do not come to this place to give away powers that belong to the people, not to us. It is wrong that we did not have a referendum on Maastricht, Lisbon and those other treaties. My clear view is that it is when this Parliament proposes to give up powers that there should be a referendum. That is the guarantee that we have written into the law of the land.

[Philip Davies (Shipley) (Con)]

As global traders, our future prosperity lies in improved trade with China, India, South America and emerging economies in Africa, and not in being part of the backward-facing, inward-facing protection racket that is the European Union, which is propping up inefficient businesses and French farmers. The Prime Minister’s objection to tonight’s motion seems to be about timing. Will he give us a timetable for getting powers back from the European Union?

[The Prime Minister]

First, where I have some disagreement with my hon. Friend is that, although we of course want to export more to China, India, Brazil, Russia and Turkey—the fast-growing countries of the future—we have to recognise that today, 50% of our trade is with European Union countries. It is therefore in our interest not only to keep those markets open and have a say about their regulation, but to further open them up. That is what we should be pushing for and are pushing for in the European Union. As I say, there is a case for a referendum if ever this Parliament proposes to give up more powers. Otherwise, it is clear what the country wants us to do: it wants us to stay in the European Union, but to retrieve some powers and ensure that we have a better relationship with Europe. That is the commitment that we have made.

[Tony Lloyd (Manchester Central) (Lab)]

The Prime Minister must recognise that whether we are talking about Greece, Italy, Spain, Portugal or Ireland, only growth will make a real difference to the financial crisis. Why did he not advocate policies of growth at the heart of these debates and, in that way, give a lead to the British people about why Europe is so important?

--- Later in debate ---

[The Prime Minister]

We have been doing exactly that, but one reason some of those countries have got into difficulties is not just the shortage of growth and competitiveness, though that has been key, but the fact that they have built up very large budget deficits. That is the lesson right across Europe—you have to make sure that you cut your cloth according to what you can afford. That is a lesson that we are tragically having to learn in this country, too.

[Charlie Elphicke (Dover) (Con)]

My constituents in Dover were very pleased and heartened to see the Prime Minister standing up to the French.

When it comes to the national interest, is not a key point that we need action on budgets and action on getting us out of the bail-out fund, not action selling us down the river, joining up with the euro or selling down the £7 billion rebate that we used to have?

[The Prime Minister]

My hon. Friend makes an important point, which is about what the British people want us to do specifically with respect to Europe. The biggest danger, they sense, is getting drawn into further bail-outs. That is why, in the treaty change that has already come forward, that was the price that we exacted—to get out of the EU bail-out fund by 2013. We have returned that power to the UK. We should also be taking action on the European budget, and we have secured agreement with some of the large countries in Europe on a real-terms freeze this year. Those priorities, plus the referendum lock, are what this Government have already been able to deliver.

[Mr Denis MacShane (Rotherham) (Lab)]

The Prime Minister prayed in aid Margaret Thatcher, but she put her money where her mouth was in the sense that the UK contribution to the European Community went up from £656 million in 1984 to £2.54 billion in 1990—a fourfold increase. Then, it was to help Greece, Spain, Portugal and Ireland. Does the Prime Minister plan to emulate her to help Poland, Latvia and our poorer friends in the new Europe?

[The Prime Minister]

The right hon. Gentleman reminds us that Margaret Thatcher did indeed put her money where her mouth was. The only trouble was the next Government came along and gave it away when they gave up the rebate for absolutely nothing in return.

[Andrea Leadsom (South Northamptonshire) (Con)]

Will my right hon. Friend speculate on what the cost would have been to the taxpayer if he and my right hon. Friend the Chancellor had not negotiated to get Britain out of the bail-out mechanism?

[The Prime Minister]

The point about the bail-out mechanism is that we were left exposed by the last Government because of the existence of the European financial stabilisation mechanism. Although we are still at risk between now and 2013, what we have secured is that we have ended that from 2013. That is an achievement. We also stayed out of the second Greek bail-out, and that was an achievement. Those things have saved real money, and it is really important for people to understand that the Government have been focused on delivering something really concrete and important for the British people at this time.

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

As a Member who voted for the implementation of Security Council resolution 1973, and who as shadow Foreign Secretary refused to meet Gaddafi when he invited me to go to Libya to collect financial compensation—blood money—for the family of WPC Fletcher, may I state my disgust and revulsion at the murder, and the nature of the killing, of Gaddafi? May I ask the Prime Minister to emphasise to the national transitional council that the future for democracy in Libya lies in reconciliation, not revenge?

[The Prime Minister]

The right hon. Gentleman makes an important point, and I can announce to the House that Chairman Jalil, leader of the national transitional council, has announced today that there will be an inquiry into the circumstances of Colonel Gaddafi’s death. Clearly, we wanted him to face justice. That is what should have happened, and it is important that that inquiry goes ahead. However, I do not stand back for one second from what I said in my statement—that because the Gaddafi era is over and he is gone, the Libyan people, who genuinely feared that as long as there was a prospect of his coming back there was a difficulty in building their future, can now get on with that future.

[Jo Swinson (East Dunbartonshire) (LD)]

I greatly welcome the Prime Minister’s leadership on Libya. Its liberation is a success not only for the Libyan people but for proving that the international community can act together to implement the responsibility to protect. However, does he agree that we must also exercise caution? Intervention under R2P must be used sparingly and only in cases that meet all the relevant criteria, such as there being a serious threat to human rights, the response being proportional and there being clear support for action internationally, regionally and within the country.

[The Prime Minister]

I very much agree with how my hon. Friend puts her question, but I would add something important to that: we should intervene only if we believe we are capable of doing so and of bringing about the effect that we need. There is a very important issue there. It is about seeing not only what is legal and necessary, but what we can do.

[Kate Hoey (Vauxhall) (Lab)]

The Prime Minister must know of the growing division between the public and politicians. Does he have no concern at all about what will happen at 10 o’clock tonight, when all three party leaders will whip their Back Benchers in a Division on a motion that is not binding, and that seeks a referendum and future legislation in—probably—2013? Does that mean that once again, the public will say, “Seventy-five per cent. of us would like a referendum at some stage. This Parliament is not listening”?

[The Prime Minister]

The hon. Lady asks a very important question, so let me try and answer it. I absolutely believe it is right to have public petitions in the way that we now do, and that it is right to give time to Back-Bench motions—this Government have brought that reform about. However, the issue of Europe is not a side issue, but an important one, and it is important that political parties and Governments make their views on it known. I do not accept the idea that somehow we can have a vote on something as important as this on a Thursday and hope that it will go unnoticed. I believe in the importance of Parliament, but I cannot believe in a sovereign Parliament on the one hand and on the other say that some of its votes and decisions do not matter. I simply do not think that that is consistent.

[Mark Reckless (Rochester and Strood) (Con)]

The Prime Minister tells The Daily Telegraph today that we should use any treaty change to shore up the euro to get powers over employment and social policy back, yet on 25 March, he agreed to precisely such a treaty change, but did not ask for anything in return.

[The Prime Minister]

I have to take issue with my hon. Friend. The very limited treaty change that is about to be debated in, and hopefully passed by, the House of Commons, gets us out of the bail-out mechanism that the previous Government got us into. I thought, and I still think as Prime Minister, that that was the single most important price that we could exact for that treaty change—that was the biggest concern of the British public. The point I made yesterday and that I will make again today is that I believe that huge changes will take place in the EU and the eurozone. That will give us opportunities to maximise the national interest, which is what we should be talking about and debating in the Conservative party, the coalition and the House of Commons as a whole. We will not further that by having a referendum that includes an in/out option. As I have said, that would be like walking away from a burning house. We should deal with that first, then talk about the future.

[Hywel Williams (Arfon) (PC)]

What assessment has the Prime Minister made of the consequences of the eurozone crisis on UK regional export-led economic growth?

[The Prime Minister]

As I said yesterday, the eurozone crisis has clearly had a chilling effect, not only on eurozone economies, but on our economy, the American economy and economies elsewhere in the world. The eurozone is a huge market for the world’s goods, and clearly there has been a slow-down, partly because of the lack of confidence in the eurozone. We must also be clear that a break-up of the eurozone would have severe consequences for neighbouring countries and banks. That is why it is very important that we work with eurozone partners to try to sort this issue out.

[Mr Bernard Jenkin (Harwich and North Essex) (Con)]

May I join others in commending my right hon. Friend for his leadership on Libya, for which he deserves considerable credit? May I also thank him for the constructive tone that he is adopting towards those of us who will support today’s motion? So many parties have again and again promised a referendum, and the British people clearly want a say over our future relationship with the European Union. Does he understand our anxiety that it is ironic that the House of Commons is likely to vote heavily against what the British people want?

[The Prime Minister]

I thank my hon. Friend for his kind remarks about Libya and my tone, which I shall try to keep constructive throughout. I completely understand people’s frustrations: they were promised a referendum on the Lisbon treaty, but they did not get it because the treaty was put in place by the previous Government, which meant that it was not then possible to hold the referendum. However, the answer to the frustration in the country over not having a referendum on the last thing is not to offer one simply on the next idea. The most important thing is to deliver what people want, which is to ensure that we get the best out of the EU and that, where there are opportunities as Europe changes, we take those opportunities. That should be the focus in this Parliament and beyond.

[Sir Stuart Bell (Middlesbrough) (Lab)]

The Prime Minister rightly said that the 27 nation states will make any decision on the single market. He has not told the House that the President of the European Council, Herman Van Rompuy, has been elected president of the 17 nation states within the eurozone, with France on one shoulder and Germany on the other. The President has said that he will inform the British Government prior to any summit meetings and inform them of the results. Does the Prime Minister think that to be “informed” is the same as to be “consulted”?

[The Prime Minister]

The hon. Gentleman makes an important point: as the eurozone comes together and the governance arrangements change, it is important that those countries that are not in the eurozone—and, in our case, do not want to join—have their interests protected. That is why, in the Council conclusions, I secured specific language about ensuring a level playing field and that countries outside the eurozone are protected. This is a journey. The eurozone is going on one journey, where it sees closer collaboration and co-operation, but I believe that countries outside the eurozone will be looking for further protections to ensure that some of our vital national interests—things such as financial services—are properly protected and not put at risk by what is happening in the eurozone.

[Mark Lancaster (Milton Keynes North) (Con)]

History tells us that following military victory, such as in Iraq and Afghanistan, we have just 100 golden days to deliver stabilisation before the joy of victory turns to despair among the local population. The clock is now ticking, so will the Prime Minister say a few words about how we will deliver this stabilisation?

[The Prime Minister]

We worked closely with others on a stabilisation and reconstruction plan for Libya. A lot of work went into that. I am optimistic because we have seen how the national transitional council is genuinely national and bringing the country together, not wanting a division between Benghazi and Tripoli. It is transitional, and the clock is now ticking for it to set up a genuine transitional Government within 30 days. Everything that I have seen of the Libyan leadership shows that it wants to get on with rebuilding its country, and because of its oil wealth and the size of its sovereign wealth fund, it has the means by which to do it.

[Fiona Mactaggart (Slough) (Lab)]

In the Prime Minister’s statement, he suggested that the EU economies could be as productive as the US economy if we had the same proportion of women in the work force. However, with unemployment among women in the UK higher than at any point since 1988, will he tell us three things that he has done to increase the proportion of women in the work place?

[The Prime Minister]

We have increased the hours available for free nursery care for three, four and two-year-olds. That is what we have done.

[Nadhim Zahawi (Stratford-on-Avon) (Con)]

Will the Prime Minister tell the House whether the President of Switzerland and the Prime Minister of Norway were at the table arguing with the French? I suspect that the answer is no because their relationship is different from ours. [Hon. Members: “They are not in the EU.”] That is absolutely right. They are not in the EU, which is why amendment C to the motion is completely the wrong option for our country to pursue.

[The Prime Minister]

My hon. Friend makes an important point. We have to ask clearly, “What is in the UK national interest?” At the heart of our national interest, when it comes to the EU, is not only access to that single market but the need to ensure that we are sitting around the table of the single market determining the rules that our exporters have to follow. That is key to our national interest, and we must not lose that.

[Mark Durkan (Foyle) (SDLP)]

Which situation does the Prime Minister hope that we will arrive at first: the eurozone passing a brink without teetering on it, or his Eurosceptics passing a top without going over it?

[The Prime Minister]

That one obviously took a long time to construct. I believe that the eurozone countries are coming together and seeing the need for a big and bold solution. That needs to happen. It will not solve the problem—because there are still major stresses and strains within the eurozone that need to be dealt with in the long term—but I think that it will happen this week. It is up to the House of Commons how it votes tonight, but I am clear that it is in our interest to be in the EU but seeking our national advantage and national interest at all times.

[Mark Pritchard (The Wrekin) (Con)]

May I congratulate the Prime Minister on his leadership on Libya? Returning to fiscal union, may I ask him what part of fiscal union he believes could trigger the European Union Act 2011?

[The Prime Minister]

The key point about the European Union Act 2011 and the referendum lock that we put in place is that any passage of powers from Britain to Brussels results in a referendum. That is the key thing that we have delivered, which means that never again can we have a situation where, as with Maastricht or Lisbon, a treaty is passed that transfers powers from this House to somewhere else without the British people being asked first. I sometimes think that we have lost the ability to make clear what a significant change that is. That is the key thing that the referendum lock delivers, and I think everyone on this side of the House can be very proud of it.

[Mr Wayne David (Caerphilly) (Lab)]

Following on from the last question, just a few months ago this House spent 42 and a half hours debating the European Union Bill, the purpose of which is to allow for referendums on the EU. Is there any chance of seeing a referendum in the near future on the EU at all?

[The Prime Minister]

The point is that if a Government propose to pass powers from this House to Brussels, they should ask the British people first. That is the simple principle that we have put into law. It is important that we try to establish clear rules for the use of referendums in a parliamentary democracy, and I absolutely believe that rule 1, line 1 is: “If you’re giving up powers that belong to the British people, you should ask them first.”

[Richard Harrington (Watford) (Con)]

I commend the Prime Minister on his statement, not least because it will reassure the thousands of my constituents who work for companies whose European headquarters are based in Watford. Can he reassure me that the things that my constituents do not like about Europe—for example, bureaucracy, reckless profligacy, gross overspending and too much regulation—will be dealt with to the best of his ability in the course of this Government?

[The Prime Minister]

I can absolutely give my hon. Friend that assurance. If he looks at what we have achieved in a relatively short time—getting out of the bail-outs, getting agreement among the big countries for a freeze in the European budget this year and getting the European Commission to focus on deregulation rather than regulation—he will see that they are all important. I agree with his first point. A lot of companies come and invest in Britain not just because of our economic strengths, our flexible labour markets and all the rest of it, but because of access to the world’s biggest single market, which is important for investment into Britain by American, Japanese and other firms, creating the jobs and wealth that we need.

[Michael Connarty (Linlithgow and East Falkirk) (Lab)]

With some financial analysts saying that banks holding sovereign debt might have to take a 25% to 60% write-down on that, can the Prime Minister elucidate for the benefit of the House what he means by a “financial firewall big enough to contain any contagion”, and say whether he thinks that the IMF needs to be involved and that the problem cannot be solved in Europe?

[The Prime Minister]

There are two issues if we are going to see a decisive resolution of the Greek situation. Obviously we need a recapitalisation of Europe’s banks, so that they have sufficient capital to withstand the losses that would otherwise affect them. Credible stress tests are crucial to that: there has been round after round of stress tests in Europe, but they have not been robust and credible enough. I believe that that has now been secured, not least because of my right hon. Friend the Chancellor’s work in the ECOFIN meeting. The second thing we need—the firewall; what I called the “big bazooka”, which the shadow Chancellor referred to the other day—is to ensure that we have a mechanism big enough to help to stop contagion to other countries. There will be discussions in the eurozone and outside it about how big that needs to be, but the answer is: bigger than is currently proposed, and they need to keep working on it.

[Sarah Newton (Truro and Falmouth) (Con)]

I very much welcome the possibility that treaty changes will be needed in the next few months. Will the Prime Minister assure me and businesses the length and breadth of this country that he will use that opportunity to get rid of ridiculous regulations and laws that are impeding growth and job creation in our country?

[The Prime Minister]

I agree with my hon. Friend’s approach. We should use these opportunities as the European Union changes and the eurozone changes to maximise Britain’s national advantage. We have to be clear: we do not yet know how much of a treaty change will be proposed by the Germans and others, or how extensive it will be. We shall have to look carefully at that to see what is right for Britain in response. However, I should say to my hon. Friend that, so far in this Government, one treaty change has been proposed and we exacted an important price, which was to get us out of the bail-out funds from 2013, which was a clear and present danger to the United Kingdom.

[Mr Jim Cunningham (Coventry South) (Lab)]

Is not the tragedy about the Prime Minister the fact that, as Leader of the Opposition, he totally underestimated the world crisis? As a result, he has had to grow up very fast in regard to European politics. What is his next alibi going to be in regard to the postponement of a referendum? I am sure that there is going to be one.

[The Prime Minister]

I have not for one minute underestimated the scale of the crisis that we face in Europe and across the world economy. Sadly, that crisis has been made worse by the vast overspending that took place under the Government whom the hon. Gentleman supported.

[Tony Baldry (Banbury) (Con)]

Will the Prime Minister confirm that, at the last general election, the Conservative manifesto committed us to seeking to return powers from Europe on economic and social policy, but that nowhere did it contain a commitment to seek an in/out referendum or to seek to renegotiate our terms of membership of the European Union?

[The Prime Minister]

My hon. Friend makes an important point. We did have a commitment to seek the return of important powers from the European Union, such as the social and employment legislation. Obviously, we are in a coalition, but as Conservative leader, I remain committed to achieving that, because it is in the British national interest to do so. My hon. Friend makes the important point, however, that it was not part of our manifesto or our policy to seek a referendum that included an in/out option. I completely respect the fact that there are Members, not only on this side of the House but on the Labour side as well, who have long wanted an in/out referendum, not least because some of them would like us to get out of the European Union altogether. But that is not our policy, and that is the reason we having the debate on this on a Monday, on a proper motion, in the proper way. This is not some side issue; it is an important issue. As I said before, I believe in the sovereignty of Parliament. To me, all decisions of Parliament matter, and the idea that we could sweep this off into a debate on a Thursday and that no one would notice is wrong. What Parliament decides matters, and that is why the Government are taking the motion seriously.

[Mr Michael McCann (East Kilbride, Strathaven and Lesmahagow) (Lab)]

A few weeks ago, I visited the Weir Group in my constituency. Its representatives explained the difficulties that they had had in evacuating British staff from Libya. They also told me of their keen desire to get back to working on vital infrastructure projects there as soon as possible. Will the Prime Minister tell us how he is going to ensure that that can happen?

[The Prime Minister]

I completely understand why the hon. Gentleman has raised that issue. It is important to his constituents and to that business, and, frankly, it is important for British investment in Libya. I can tell him that Stephen Green, Lord Green, has already held a Libyan investment conference and has plans to travel to Libya. I recommend that the hon. Gentleman contacts that Minister, and I will make sure that that happens so that we can help the Weir Group with the important work that it does.

[Robert Halfon (Harlow) (Con)]

Many of my constituents who have contacted me over the past few days tell me that they lost their trust in politics because the previous Government refused to give them a referendum on the Lisbon treaty. What substantive message can my right hon. Friend give me to take back to those constituents?

[The Prime Minister]

I completely understand their concerns, but just because the last Government failed to hold a referendum on the Lisbon treaty does not mean that we should vote tonight for a referendum on an in/out option that was not in any of our manifestos. The reassurance that I would give to my hon. Friend’s constituents is that the Government are doing all the things that people care about most in Europe, such as constraining the European budget, getting out of the bail-out funds and cutting unnecessary regulation. We are doing all those things, and there will be more to come.

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

Did I hear the Prime Minister correctly when he said earlier that he now believes that there should have been a referendum on the Maastricht treaty? In the light of the Foreign Secretary’s well-rehearsed opposition to that, will he tell us exactly when he changed his mind?

[The Prime Minister]

I have always felt that, and our Bill is clear. Under our Bill, Maastricht or any of those treaties would have triggered a referendum. That is the point. I do not think that the hon. Gentleman has been keeping up. I hope that Labour will commit to that legislation, which will mean that if any Government ever try to give away powers from this House, they will have to ask the British public first.

[Harriett Baldwin (West Worcestershire) (Con)]

Has the Prime Minister noticed that, while this Government have ruled out joining the euro, it is the continued policy of Her Majesty’s Opposition, regardless of who is leading them?

--- Later in debate ---

[The Prime Minister]

There was an interesting series of interviews with the Leader of the Opposition over the weekend. As well as saying that if he were Prime Minister for long enough, he would like to get us into the euro, he responded to being asked whether he thought that Brussels had too much power by saying:

“No, I don’t think Brussels has got too much power”.

That is the official position of the Labour party: wrong about the euro, wrong about Brussels, wrong about Britain. Wrong about everything!

[Naomi Long (Belfast East) (Alliance)]

I share the Prime Minister’s optimism at the formal liberation of Libya, and I pay tribute to the role our armed forces have played in that process. Is the Prime Minister as concerned as I am, however, at the allegation of the summary execution of any human being—even of a violent tyrant such as Gaddafi? Does he share my view that there is a need urgently to re-establish the rule of law and proper democracy in that country?

[The Prime Minister]

I think the hon. Lady makes an important point. We all saw those pictures on our televisions and newspapers; they were not pleasant images. I think everyone understands that that is not what should have happened; it should have ended in a trial and in Gaddafi facing justice. As I said earlier, Chairman Jalil has announced that there will be an inquiry, and I think it is important that the Libyans carry it out properly.

[Rory Stewart (Penrith and The Border) (Con)]

May I respectfully disagree with the Prime Minister’s idea that there are no lessons from Libya? The lesson from Libya, which could be applied to Europe, is that what matters is not what you ought to do, but how you do it, with whom and when.

[The Prime Minister]

I did not say that there are no lessons to learn; I think there are lessons to learn. The Government are carrying out a lessons learned process and will be announcing the key results from it. The point my hon. Friend makes about what you are able to do and how you build alliances to do what you want to do is absolutely vital—and was vital in this case. What I was trying to say—perhaps I did not put it across properly—is that we have to be careful not to say that because Libya was successful in this way, we can read that across to every single other proposed intervention. We cannot do that. As a liberal Conservative, I believe that a bit of scepticism should be brought to these schemes before we embark on them.

[Steve McCabe (Birmingham, Selly Oak) (Lab)]

For the sake of absolute clarity, is it now this Prime Minister’s position that he could accept substantial German-led changes to the Lisbon treaty without it requiring the referendum he promised the British people?

[The Prime Minister]

The key point is this. If there is a proposal for moving powers from this House of Commons to Brussels, there is a referendum guarantee. It is absolutely vital that people understand that; it is the promise that we make. We do not yet know whether treaty change will definitely be proposed; we do not yet know what it will consist of or how big it will be. The pledge I can make is that we will use that opportunity to further the national interest—something that did not happen under 13 years of a Labour Government.

[Duncan Hames (Chippenham) (LD)]

Closer fiscal policy co-ordination within the eurozone marks two very different degrees of political integration among EU member states. Does the Prime Minister consider that, unlike recent referendums in other EU countries, this development, alongside the passage of the European Union Act 2011, affords the British public a more meaningful veto than before on treaty changes and their impact on our own country?

[The Prime Minister]

I think my hon. Friend is absolutely right. That is the assurance that people seek—you should not change the rules of the game and you should not give away powers that are not yours to give away. The British people should have a block on that; that is what we have put into place. No Government should rule out for ever putting questions in a referendum—after all, this Government had a referendum on the alternative vote—but that is not what I am saying; I am saying that the bedrock of our views about a referendum in a parliamentary democracy is that you should not give powers away from Parliament without asking the people first.

[Jonathan Ashworth (Leicester South) (Lab)]

Ahead of tonight’s vote, with a rebellion apparently looming, will the Prime Minister tell us what advice he has taken from the former Prime Minister, John Major? [Interruption.]

[The Prime Minister]

Oh, thank you very much. Well, the hon. Gentleman can have plenty of advice from a former Prime Minister because he used to work for one. I do not know whether it appears on his CV; my advice would probably be to leave it off!

[Neil Carmichael (Stroud) (Con)]

With large and significant supply chains stringing across Europe and a market of 500 million people, does the Prime Minister agree that businesses across this country would be really pleased to see us further strengthen the capacity of the single market to deliver more trade?

[The Prime Minister]

My hon. Friend makes an important point. All these years after the single market was started, we have still not completed the single market in services. In this country, service is one of our strongest industries, and it is actually countries like Germany that have not yet completed that single market. I know that people are bored of hearing the agenda of completing the single market in services, liberalising energy markets, deregulating in Europe, but if we want to raise our growth rate in Europe and raise our game in Europe, this is squarely in our British national interest.

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

I congratulate my right hon. Friend on his leadership in the Libyan situation, when there were many doubters who have been proved unequivocally wrong. Will he assure me that he will continue to work with the President of France and others on the United Nations Security Council to address the situation in Syria?

[The Prime Minister]

I can assure my hon. Friend that, whatever our disagreements on economic policy—and, by and large, we are united on it—the French President and I will work very closely together on foreign affairs and defence issues. I think that there is a real coming together of French and British national interests, but, as I said earlier, when we do sometimes have disagreements we should not be frightened, as good friends, of airing them and discussing these matters.

The Cabinet Manual

Lord Cameron of Chipping Norton Excerpts

Monday 24th October 2011 Written Statements

[The Prime Minister (Mr David Cameron)]

The Government have published today “The Cabinet Manual” on the Cabinet Office website: www.cabinetoffice.gov.uk/resource-library/cabinet-manual.

“The Cabinet Manual” is intended to be a source of information on the UK’s laws, conventions and rules that affect the operation and procedures of Government.

A summary of responses received on the “Draft Cabinet Manual”, which was published in December 2010, and a Government response to the reports of the House of Lords Constitution Committee, Political and Constitutional Reform Committee and Public Administration Select Committee (Cm 8213) on “The Cabinet Manual” have also been published on the Cabinet Office website.

Copies of all documents have been placed in the Libraries of both Houses and also in the Vote Office and Printed Paper Office.

Oral Answers to Questions

Lord Cameron of Chipping Norton Excerpts

Wednesday 19th October 2011 Commons Chamber

[Mr Stephen Hepburn (Jarrow) (Lab)]

Q1. If he will list his official engagements for Wednesday 19 October.

[The Prime Minister (Mr David Cameron)]

I am sure that the whole House will wish to join me in remembering Rifleman Vijay Rai, from 2nd Battalion The Royal Gurkha Rifles. He was a talented and dedicated soldier, and our deepest sympathies should be with his family and his friends. He was proud to be a Gurkha and it is at times such as these that we especially remember the deep debt of gratitude that we owe all those brave soldiers.

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

[Mr Hepburn]

I commend and share the views of the Prime Minister concerning our brave military personnel.

Is the Prime Minister aware that this year we commemorate the 75th anniversary of the Jarrow march? Is it not wrong that even today people in this country live in fear of the dole and unemployment? The Government have been in for one year and already we are back to the 1980s. I ask him a simple question: will he support workers or sacrifice them?

[The Prime Minister]

I believe that we need to be supporting people and helping them back into work. As the hon. Gentleman says, we should commemorate the Jarrow march, and I notice that it has been commemorated this year. We have a challenge right across the country as we see the numbers of those employed in the public sector inevitably go down, which would be happening whoever was standing at this Dispatch Box. We have got to make sure that there are more jobs in the private sector.

It is worth while that in the north-east Nissan is creating 200 new jobs, Hitachi is creating up to 500 new jobs, the Lear Corporation is creating an extra 300 jobs, and BT is creating an extra 280 jobs, in South Shields. There are 500,000 more private sector jobs—new jobs—compared with the time of the last election, but I recognise that we need to do more. That is what the Work programme is all about.

[Oliver Colvile (Plymouth, Sutton and Devonport) (Con)]

Q15. May I congratulate my right hon. Friend on his joint declaration with the Canadian Prime Minister on ocean renewable energy? We need to ensure that we have growth in our economy. What does he think universities such as Plymouth, which has a very good reputation for marine science research, can do to help to ensure that we have that?

[The Prime Minister]

I commend my hon. Friend for his question, because a number of universities in our country—including Edinburgh, which I have visited—are leaders in marine renewable energy. My right hon. Friend the Energy and Climate Change Secretary yesterday announced that we will go ahead with renewables obligation certificates, ensuring that we boost that vital industry and attract jobs to this country for offshore wind and other renewable technologies.

[Edward Miliband (Doncaster North) (Lab)]

May I join the Prime Minister in paying tribute to Rifleman Vijay Rai from 2nd Battalion The Royal Gurkha Rifles? In joining the Army, he was following in a proud family tradition. He showed the utmost courage and bravery, and our deepest condolences are with his family and friends.

The revelations over the past week about what has been going on in the most sensitive Department at the heart of the Prime Minister’s Government are deeply worrying. The former Defence Secretary had an unofficial adviser with access to top officials in the military and, indeed, in foreign Governments, who was funded by undeclared private donations solicited by him, yet the Prime Minister says that he and No. 10 knew nothing about these goings-on for 18 months. How did he allow this to happen?

[The Prime Minister]

First, I agree with the right hon. Gentleman that this is an important and serious issue, which is why I set up a full and proper inquiry by the Cabinet Secretary. He has produced his report, and it has been published in full. It is worth noting, however, that in this case the Secretary of State for Defence recognised that he had made a mistake, acknowledged that had broken the ministerial code and resigned. That was not something that always happened in the previous 13 years.

[Edward Miliband]

I have a piece of advice for the Prime Minister: this week of all weeks, show a bit of humility, eh? The truth is that we still do not know the full facts about this case, about the money trail and about who exactly in the Government met Mr Werritty. It is becoming clear that there is a network of individuals, some with close links to the Conservative party and other Cabinet members, who funded Mr Werritty. Given that the Prime Minister says that he knew nothing about the former Defence Secretary’s arrangements, can he give the House a categorical guarantee that over the past 18 months no other Minister has been engaging in similar activities?

[The Prime Minister]

I think that we should have a little humility from the people who gave us cabs for hire, passports for favours, mortgages for mates, dodgy dossiers, the smearing of opponents and good days to bury bad news. I note that these were the questions that the right hon. Gentleman was meant to ask last week. I have some advice for him: if he is going to jump on a bandwagon, make sure it is still moving.

[Edward Miliband]

The Prime Minister has no answer to the question that people want answered. We have seen a pattern of activity from him: he does not ask the tough questions of those around him, and when anything goes wrong, it is nothing to do with him. What did he say in the ministerial code that he published? He said:

“It is not enough simply to make a difference. We must be different.”

In the past three months, we have seen his Defence Secretary resign in disgrace and his spin doctor arrested. Is that what he meant by being different?

[The Prime Minister]

The right hon. Gentleman seems to have failed to notice that the Minister in question has resigned—you’re just a bit late.

[Mr Julian Brazier (Canterbury) (Con)]

Would my right hon. Friend agree that at a time when—[Interruption.]

[Mr Brazier]

Would my right hon. Friend agree that at a time when the Governor of the Bank of England has said that we are facing a possibly unprecedented economic crisis, it is a good thing that the country is still committed to getting our debts under control and to retaining credibility in the financial markets?

[The Prime Minister]

My hon. Friend makes an important point. People should listen to what the Governor of the Bank of England said yesterday:

“With a lower level of sterling and a credible plan to reduce the fiscal deficit over the medium term, we were on track. But the problems in the euro area and the marked slowing of the world economy have lengthened the period over which a return to normality is likely.”

That is what we face in this country, but it means that we should stick to the plan of dealing with our debts and our deficit. If we listened to the Labour party and added £23 billion to the deficit this year, it would not be “Greek-onomics”; it would be “freakonomics”.

[Mark Durkan (Foyle) (SDLP)]

Q2. The Prime Minister has acknowledged that there was collusion in the murder of Pat Finucane. Does he accept that in order to get to the bottom of that we have to get to the top of that? Does he recognise that many of us lack confidence that a desk review by even an eminent lawyer will be able to do that? Will he reflect further on the grave misgivings expressed by the Finucane family and the Irish Government?

[The Prime Minister]

Of course I understand the scepticism of the hon. Gentleman; and of course, there was great scepticism by many at the time of the Saville inquiry about whether it would get to the truth. What matters most is the intent of the British Government in uncovering what happened, being frank about it, acknowledging it and apologising for it. That is what we are going to do, and we do not need an open-ended inquiry to achieve that. To those who are sceptical, I know that they will go on being sceptical; I would just ask them to have an open mind. I believe that we can deal with this issue properly.

[Martin Horwood (Cheltenham) (LD)]

Will the Prime Minister join me in congratulating Cheltenham borough council on building the first new council housing in 20 years and planning more and more affordable housing on brownfield sites, but also recognise the council’s anxiety that the first draft of the new national planning policy framework could render it powerless to defend vital and treasured green spaces on the urban fringe, which are being deliberately targeted by developers?

[The Prime Minister]

Let me reassure the hon. Gentleman on the planning policy. We are not making changes to green belt or other protections, and I am sure he can discuss that with the planning Minister. Of course I congratulate all local councils that get on and build the houses that we badly need to house the homeless and deal with overcrowding. I am sure that the hon. Gentleman will welcome the announcements that have been made—the Deputy Prime Minister and I have been working closely on this—to ensure that we use money from the right to buy to build more social housing so that we end the scandal of overcrowded housing.

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

Q3. I thank you, Mr Speaker, and your staff, and would like to put on record my gratitude to the Home Secretary and those in all parts of the House for their support for the Hillsborough families during Monday’s debate. Will the Prime Minister acknowledge that Governments have made mistakes, that 22 years is 22 years too long to fight for the truth and that if it is proven that there was an orchestrated cover-up, justice should prevail, despite two decades passing, and those really responsible for the Hillsborough disaster should be brought to book?

[The Prime Minister]

Last week I promised the hon. Gentleman that the time for his debate would be properly protected and that the House would have proper time to debate it, which it did. This week I can tell him that we are going to open up those papers and publish them as we promised so that people can see what was happening. However, it is important to remember that the Taylor inquiry was a proper and thorough investigation. It was not just an inquiry into what happened; it also led to huge changes in the way we manage and arrange football in this country. Hillsborough was a national tragedy. I am hugely sympathetic to the families of the victims, and I am sure that there are regrets for all the institutions involved at the time, including the Government.

[Damian Hinds (East Hampshire) (Con)]

The Prime Minister has already given his backing to national heroes day this Friday, 21 October. Will he join me in commending the hundreds of schools taking part, celebrating inspirational role models and raising money for Help for Heroes?

[The Prime Minister]

I am very pleased to do that. I am a huge fan of Help for Heroes. The way the charity has grown has been a remarkable story. I have seen for myself the extraordinary efforts that it has made at Headley Court, where it has built an extraordinary swimming pool that is used by so many people who are recovering from their injuries in Afghanistan and elsewhere. I would certainly be pleased to support what my hon. Friend says.

[Edward Miliband]

Last week we heard that unemployment was at its highest level since the last Conservative Government. This week we heard that retail price inflation was at its highest level since the last Conservative Government. Does the Prime Minister still think that his plan is working?

[The Prime Minister]

To put the right hon. Gentleman right, the last time that CPI—which is the measure of inflation that we all now recognise—was as high as this was in 2008, when he was in government. That is quite an important point to note. Of course inflation is too high. The principal reasons for it being so high are world food prices, world fuel prices, the depreciation of sterling—[Hon. Members: “VAT.”] Yes, there was an effect from the increase in VAT, just as there was an effect when he increased VAT at the beginning of 2010, but the reason for increasing VAT is to get on top of the record deficit that the last Government left.

[Edward Miliband]

As always, the Prime Minister says that it is just like that in the rest of the world, but we have the highest inflation of any EU country apart from Estonia. That is because of decisions that he made, including the decision on VAT. Week in, week out, the evidence mounts that his plan is not working, but he refuses to change course. Last week, we heard that his flagship national insurance scheme had not worked. Now let me ask him about his flagship regional growth fund, which he launched 16 months ago. Can he tell us how many businesses have had cash paid out to them under the scheme?

[The Prime Minister]

First, let me just put the right hon. Gentleman right on this issue—[Interruption.] It is important. One of the reasons Britain has such a difficult situation with inflation is that we were the country with the biggest boom and the biggest bust of any major European country. He cannot hide from that. The regional growth fund is going to be distributing billions of pounds right across the country, and it is a thoroughly worthwhile scheme that he should be supporting.

[Edward Miliband]

I do not think that the Prime Minister knows the answer. The Government have certainly issued lots of press releases about the regional growth fund—22 of them—but how many businesses have been helped during the past 16 months? Two businesses have been helped. And how many businesses have gone bankrupt in that time? Sixteen thousand. What greater example could there be that this Government’s plan is not working? We have had 18 months of his economic experiment, and what have we got to show for it? More and more people losing their jobs, more and more businesses going bust and inflation going through the roof—and all we have is a Prime Minister who is hopelessly out of touch.

[The Prime Minister]

All the right hon. Gentleman wants to do is talk down the economy, so he will not mention the fact that 300,000 new businesses have started and that 500,000 people have jobs who did not have one at the time of the election. The big question for the right hon. Gentleman is: if he does not like our plan, where is his plan? We now know that his plan to deal with our debts is—[Interruption.]

[Mr Speaker]

Order. Organised barracking is not acceptable. The Prime Minister’s answer must be heard.

[The Prime Minister]

The right hon. Gentleman’s plan is to add £23 billion to Britain’s deficit this year, and almost £100 billion to our deficit by the end of the Parliament. There is not a single country in Europe that would have such a crazy plan—[Interruption.]

[Mr Speaker]

Order. We are most grateful to the shadow Chancellor for his advice, but I would like to apply it to the House as a whole. The whole House must calm down; otherwise, it will be in need of medical treatment.

[The Prime Minister]

The problem is that it was the advice of the right hon. Member for Morley and Outwood (Ed Balls) that got us into this mess in the first place. When is he going to learn that there is not a single country in Europe that thinks that you deal with your debts by adding to your debts? That is why no one listens to him here or in Europe.

[Anna Soubry (Broxtowe) (Con)]

Yesterday, a report was published into the serious failure of Nottinghamshire police to protect a young woman who went on to be murdered by her violent partner. Does the Prime Minister agree that it is imperative that all police forces have the practices, policies and training necessary to protect women from violent men?

[The Prime Minister]

I absolutely agree with my hon. Friend; she makes an important point. Some police forces have taken huge steps forward in dealing with domestic violence, but not all of them have done so. We need to spread that best practice right across the country.

[Pat Glass (North West Durham) (Lab)]

Q4. The Association of Colleges has just announced the largest fall in college enrolments since 1999, and it cites the abolition of EMA as a major factor. This is a tragedy of the Government’s own making, and it lies directly at the door of the Secretary of State for Education. What is the Prime Minister going to do to put this right?

[The Prime Minister]

I think that the hon. Lady will find that the figures show that some enrolments in some colleges have actually gone up. Our replacement for EMA is a well-funded scheme that will be much better targeted at those people in need. The people who really need the extra money will get more than they did under EMA.

[Neil Parish (Tiverton and Honiton) (Con)]

Families in the country are facing very high fuel bills, and there is a vested interest among the big six fuel companies not to allow competition into the market. What exactly is the Prime Minister doing to encourage more competition and to bring prices down?

[The Prime Minister]

One of the things we are doing is insisting that the big six have to make more of their energy available in a pooling arrangement so that new businesses can come into the industry. The reason we have to do this is that the last Government abolished the pooling arrangements, creating the situation with the big six—and we do not need to ask who the Energy Secretary was during that Government as we are looking at him.

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

Q5. Given the importance of carbon capture and storage both as a way of helping to reduce our carbon emissions and as an exportable technology to help rebalance the economy, will the Prime Minister put his words into action and step in to ensure that the Longannet demonstration project goes ahead?

[The Prime Minister]

What I can say is that the funding we set aside for carbon capture and storage is still there and will be made available. Clearly, the Longannet scheme is not working in the way that was intended, but the money and support from the Government for this vital technology is there.

[John Pugh (Southport) (LD)]

Q6. Given the huge savings for the nation made by the Cabinet Office across government without legislation and the huge financial risks provoked by constant structural reorganisation, as in the NHS, would it not be better if politicians learned to manage more and meddle less—even if Governments find the latter easier and more interesting?

[The Prime Minister]

My hon. Friend makes an important point. Let me pay tribute to the Minister for the Cabinet Office and Paymaster General, my right hon. Friend the Member for Horsham (Mr Maude), who does this patient work at the heart of government and does not always get recognised for it. We have reduced management consultants by 70%, saving £870 million; we have spent £490 million less on temporary labour; we have spent £400 million less on marketing and advertising: that is an 80% reduction. These are serious changes to cut the cost of central Government and make sure we provide good value for money. None of those things was done under the last Government.

[Mr John Spellar (Warley) (Lab)]

Q7. Before the election the Prime Minister claimed that anyone caught carrying a knife should expect to go to prison. Has he read Brooke Kinsella’s article in today’s The Sun, revealing that 40% of all knife crime is carried out by under-18s? Why will he not deliver on his promise and put them in jail?

[The Prime Minister]

We are doing something that the last Government failed to do, which is to create a mandatory sentence for adults who are caught with knives to make sure that happens.

[Andrew Rosindell (Romford) (Con)]

The Prime Minister will be aware that the British people are simply crying out for a referendum on the future of Europe. Will he please make history, follow the example of great Prime Ministers like Winston Churchill and Margaret Thatcher and give the British people the chance to vote on our future with the European Union?

[The Prime Minister]

I completely understand and share the frustration that many have about the way in which the European Union goes about its business, particularly the costs and the bureaucracy, but I have to say that the key focus is to get on top of the EU budget, keep Britain out of the bail-out schemes and ensure that the single market is working. Of course we are committed as the Conservative party to the return of powers from Brussels to Westminster. We are also committed as a Government to ensuring that if power passes from Westminster to Brussels, there will have to be referendum. That promise is good for the whole of this Parliament and beyond, but I do not support holding a referendum come what may. That is not our policy and I will not support such a motion.

[Mr Gregory Campbell (East Londonderry) (DUP)]

Q8. We are all aware of the bravery and courage of our armed forces as they serve in Afghanistan. Last November Ranger Aaron McCormick from just outside Coleraine in my constituency died in Helmand province; he was one of many who paid the highest price to defend freedom. His commanding officer said: “Today, there is a gap in our ranks which no ordinary man could fill. He was the best of his country and we mourn his loss.”Will the Prime Minister ensure that a review is carried out into the way the Ministry of Defence prepares its honours list so that families can see that the entire nation recognises the sacrifice and selflessness of these brave men and women?

[The Prime Minister]

I will certainly look carefully at what the hon. Gentleman says and perhaps arrange a meeting between him and the Under-Secretary of State for Defence, my right hon. Friend the Member for South Leicestershire (Mr Robathan) who is responsible for veterans and these issues. That would be a good thing to do. Let me say again that I have the highest possible regard for the professionalism, the courage and the dedication of our forces. We have paid a very high price in Afghanistan and in Iraq for what we have had to do there. I think the whole country, perhaps in a little bit of a contrast to what the hon. Gentleman says, recognises that and feels that very strongly and is looking for new ways to recognise what our armed forces do. That is why there is such strong support for Help for Heroes, for homecoming parades, for lists of honours, for the military covenant and for all such things. I think we should go on looking at what more we can do to recognise the service and sacrifice of our armed forces.

[Mr Adrian Sanders (Torbay) (LD)]

Q9. As a result of inaccurate reporting and statements about a European directive applying to insulin-dependent diabetics, up to a million such people fear for their driving licences. Is it not the case that the way in which the Department of Transport interprets that directive will determine whether or not people lose their licences? Will the Prime Minister make the position clear?

[The Prime Minister]

I will certainly try to do that.

I entirely understand my hon. Friend’s concern, which is shared by many insulin-treated diabetics throughout the country who want to continue to drive freely as they have in the past, but I can reassure him that relatively few of them will lose their licences as a result of the directive to which he has referred. The Driver and Vehicle Licensing Agency is going back to the European commission to check its understanding of the interpretation of the minimum standards in the directive. As Members in all parts of the House probably know, Departments gold-plate directives on too many occasions, and it cannot be said too often that they should stop it.

[Angus Robertson (Moray) (SNP)]

We learnt today that the British Airports Authority is to sell Edinburgh airport. Does the Prime Minister agree that it is important for the Scottish economy that we have as many direct international routes and services as possible? If so, why does he not listen to the views of the four major airports and Transport Scotland, which want air passenger duty to be devolved?

[The Prime Minister]

I think the most important thing is that investment goes into the infrastructure of our airports, and I know from first hand that Edinburgh airport has superb facilities which continue to be improved. As for air passenger duty, we will continue to listen carefully to those arguments.

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

Q10. Does the Prime Minister agree that if we are to tear down the apartheid in the education system, for which he argued a few weeks ago, not only should well-performing private schools support under-performing state schools on an ad hoc basis, but we should go further and encourage them to federate?

[The Prime Minister]

My hon. Friend makes an excellent suggestion. I believe that that should be a cross-party initiative, and I pay tribute to Lord Adonis, who has made some extremely important speeches about the issue. I see a real opportunity for independent schools to do what Wellington college, Dulwich college and Brighton college have done, and sponsor academies in the state sector. I think that we can see the breaking down of the barriers between independent and state education, I think that this is a great way forward, and I hope that it will be given all-party support.

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

Q11. A change in the national targets regime and cuts have led to disarray in the Greater Manchester emergency services. A stroke victim has had to wait for an hour for an ambulance, the response time of the fire service has doubled in parts of Greater Manchester, and the police switchboard is in meltdown. What reassurances can the Prime Minister give that the failure of those services will not lead to a tragic death?

[The Prime Minister]

I will give careful consideration to what the hon. Gentleman has said. What I can say about health funding specifically is that we are implementing the £20 billion efficiency savings suggested by the now shadow Health Secretary, the right hon. Member for Leigh (Andy Burnham). However, the difference between the policy supported by his party and our policy is that we are putting all those savings back into the NHS, whereas the official Labour position is that increasing spending on the health service in real terms is “irresponsible”. We think it irresponsible not to increase spending.

[Jason McCartney (Colne Valley) (Con)]

Q14. David Brown Engineering in Lockwood, in my constituency, has received a regional growth fund investment that will help to create 80 new jobs. Does the Prime Minister agree that, notwithstanding the moithering and doom-mongering of Opposition Members, there are success stories out there? With that in mind, will he consider coming to open the new innovation and enterprise centre at Huddersfield university in the spring?

[The Prime Minister]

What a delightful invitation! I thank my hon. Friend—[Interruption.]

[Mr Speaker]

Order. I want to hear about the Prime Minister’s Huddersfield travel plans.

[The Prime Minister]

Thank you, Mr Speaker. I look forward to making those travel plans.

I think that my hon. Friend has managed to show that the Leader of the Opposition’s first lot of questions were irrelevant and the second lot were probably wrong.

[Ian Austin (Dudley North) (Lab)]

Q12. The answer the Prime Minister just gave to my right hon. Friend the Member for Warley (Mr Spellar) is simply not good enough. The fact is that, despite all the Prime Minister’s promises, fewer people caught carrying knives are going to prison under this Government than under the last, so will he apologise to Brooke Kinsella and all the bereaved families of victims of knife crime for breaking the promise he made that he would take a tougher approach?

[The Prime Minister]

I am full of admiration for the campaign Brooke Kinsella has run. When someone has suffered such a loss in their own family, it is incredibly brave of them to get out there and campaign for change—and not just change in the law, but also change in the way the police behave and in the way young people behave. I think she is a thoroughly good individual, with a very great campaign. What this Government are doing—which the last Government did not do—is have a mandatory sentence for knife crime, which we will introduce in our forthcoming Bill.

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

Will my right hon. Friend join me in supporting the Royal College of Speech and Language Therapists “giving voice” campaign, which rightly emphasises the central importance of speech, language and communication in tackling a wide range of social issues?

[The Prime Minister]

I will certainly join my hon. Friend in doing that, and I know that you, Mr Speaker, take a close personal interest in this issue as well. Anyone who has brought up disabled children knows the vital importance of speech and language therapists. They also know that there are often not enough of them to provide all the help and services we need, and that getting their services through the statementing process can be extremely tough. I therefore certainly agree with what my hon. Friend says.

[Mr Russell Brown (Dumfries and Galloway) (Lab)]

Q13. We know that officials from other Governments were given the impression that the former Defence Secretary’s unofficial adviser represented the UK Government. How many people in total were misled, and will the Prime Minister provide a list?

[The Prime Minister]

The hon. Gentleman should read the Cabinet Secretary’s report, as he will find there all the details he might need about what Mr Werritty was doing, but I have to say that for the hon. Gentleman’s party to lecture us on lobbying comes slightly ill given that we now know that the former Labour Defence Secretary is working for a helicopter company, the former Home Secretary is working for a security firm, Lord Mandelson is at Lazard, and even the former leader and Prime Minister has in the last few months got £120,000 for speeches to Credit Suisse, Visa and Citibank. He told us he had put the money into the banks; we did not know he would get it out so quickly.

[Mark Pritchard (The Wrekin) (Con)]

Returning to the topic of Europe, does the Prime Minister accept that moves towards fiscal union in the eurozone will ultimately undermine the single market and the United Kingdom?

[The Prime Minister]

My hon. Friend makes an extremely important point. While we believe that the logic of a single currency drives the eurozone towards greater fiscal integration, that poses particular threats and risks to those of us who want the single market to work properly. At the European Council this weekend it is important to argue for safeguards to make sure that the single market remains robust and properly protected. That is what we must do in the short term. Of course in the longer term there may be further moves towards further treaties and so forth, and at that stage there may be opportunities to bring further powers back to Britain—and there may, indeed, be opportunities to hold a referendum, but I do not believe the right answer is to hold a referendum willy-nilly in this Parliament when we have so much to do to get Europe to sort out its problems.

[Mr Michael Meacher (Oldham West and Royton) (Lab)]

On a statutory register of lobbyists, will the Prime Minister also ensure that so-called think-tanks—whose propaganda is clearly aimed at manipulating both Ministers and the public for their own ends—are required to reveal who ultimately funds them, so that we all know whose interests they really represent?

[The Prime Minister]

We are committed to having a statutory register of lobbyists. That does need to be put in place and, as the right hon. Gentleman says, it needs to include think-tanks and other such organisations. It also needs to include one of the biggest lobbies of all—the lobby that owns the Labour party lock, stock and trade union barrel: the trade unions.

[Several hon. Members]

rose—

Cabinet Secretary's Report

Lord Cameron of Chipping Norton Excerpts

Wednesday 19th October 2011 Written Statements

[The Prime Minister (Mr David Cameron)]

I am placing in the Libraries of both Houses the report by the Cabinet Secretary, Sir Gus O’Donnell, into allegations against my right hon. Friend the Member for North Somerset (Dr Fox).

My right hon. Friend resigned last week as Defence Secretary accepting that he had mistakenly allowed the distinction between personal interest and Government activities to become blurred.

I accepted my right hon. Friend’s resignation from Government and his reasons for resigning while making clear that as Defence Secretary he had implemented fundamental changes that will help to ensure that our armed forces are fully equipped to meet the challenges of the modern era. The report by the Cabinet Secretary confirms that my right hon. Friend did breach the ministerial code.

This Government have already introduced changes that significantly increase Government transparency including publishing lists of ministerial meetings with external organisations and all procurement over £500. The permanent secretary at the Ministry of Defence has already accepted that there should have been much tighter procedures within the Department and is taking steps to strengthen them to ensure that the ministerial code is properly adhered to.

The Cabinet Secretary has recommended further strengthening of procedures across Government. I have accepted these recommendations and the Cabinet Secretary will write to permanent secretaries setting this out.

Oral Answers to Questions

Lord Cameron of Chipping Norton Excerpts

Wednesday 12th October 2011 Commons Chamber

[Sir Alan Beith (Berwick-upon-Tweed) (LD)]

Q1. If he will list his official engagements for Wednesday 12 October.

[The Prime Minister (Mr David Cameron)]

I am sure that the whole House will wish to join me in paying tribute to Lance Corporal Jonathan McKinlay from 1st Battalion the Rifles and Marine David Fairbrother from Kilo Company 42 Commando Royal Marines. They were both extremely committed and courageous servicemen who have given their lives in the service of our country. Our thoughts and deepest sympathies should be with their families, friends and colleagues.

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

[Sir Alan Beith]

The whole House will want to endorse the Prime Minister’s words about our heroic service personnel and their families, and I think that most of us also want to see the earliest possible withdrawal of our combat troops from Afghanistan.

What will the Prime Minister do about that group of women already in their late 50s who have seen their state pension age rise from 60 to 64 and now face a further two-year increase from 64 to 66? The coalition had to reform the pension system and will be fairer to women, but this anomaly needs addressing.

[The Prime Minister]

My right hon. Friend is right to identify that it is of course right to equalise men and women’s state pension ages. That has been a long-term goal shared across the House of Commons. I also think that it is right to raise the retirement age to 66, as we have done. We know that a large group of people are affected by this transition and that some people will potentially have to work for an extra two years. We are looking at what transitional help we can give to this group of people and will make an announcement shortly.

[Edward Miliband (Doncaster North) (Lab)]

I join the Prime Minister in paying tribute to Lance Corporal Jonathan McKinlay from 1st Battalion the Rifles and Marine David Fairbrother from Kilo Company 42 Commando Royal Marines. They were exceptionally courageous men who died serving their country and our deepest condolences go to their family and friends.

A year ago, during our exchanges, the Prime Minister justified his economic policy by saying that unemployment would fall this year, next year and the year after. Given that unemployment has risen by 114,000, is it not time he admitted that his plan is not working?

[The Prime Minister]

First of all, these are very disappointing figures that have been announced today and every job that is lost is a tragedy for the person concerned and their family. That is why this Government will do everything we possibly can to help get people into work. That is why we have the Work programme, the biggest back-to-work programme since the 1930s, which will help 2.5 million people. That is why we have welfare reform to make sure that it always pays for people to be in work. That is why we are reforming our schools, including raising the participation age to 18 so that we end the scandal of 16 and 17-year-olds left on the dole, and that is why we have a record number of apprenticeships—360,000 this year. I accept that we have to do more to get our economy moving and get jobs for our people, but we must not abandon the plan that has given us record low interest rates.

[Edward Miliband]

We hear the same script month after month. It is not working. Does the Prime Minister not realise that today’s figures show that it is not working? It is his failure that means today in Britain we have nearly 1 million young people out of work. Why does he not accept some responsibility for doing something about it?

[The Prime Minister]

I accept responsibility for everything that happens in our economy, but I just sometimes wish that people who were in government for 13 years accepted some responsibility for the mess they made. This Government have pledged to do everything we can to get our economy moving. That is why we have cut petrol tax and corporation tax, why we are reforming the planning system, why we introduced the regional growth fund, why we are forcing the banks to lend money and why we have created 22 enterprise zones. I know what the right hon. Gentleman wants: he wants us to change course on reducing our deficit. If we changed course on reducing our deficit, we would end up with interest rates like those in Portugal, Spain, Italy and Greece and we would send our economy into a tailspin.

[Edward Miliband]

I want the Prime Minister to change course so that he has a credible plan to get people back to work in this country. What he does not seem to understand is that month after month, as unemployment goes up and the number of people claiming benefit goes up, the costs go up and fewer people are in work and paying taxes. To have a credible plan on the deficit, you need a credible plan for growth, and he does not have one. It is not just young people who are suffering. Can the Prime Minister tell us when was the last time that unemployment among women reached the levels it has today?

[The Prime Minister]

The right hon. Gentleman is wrong on his figures. There are 50,000 more women in work than there were at the time of the election, there are 239,000 more people in work than at the time of the election, and there are 500,000 more private sector jobs. He specifically asks about a credible growth plan. I would ask, where is his credible growth plan? Why is it that the former Chancellor of the Exchequer said this:

“If you don’t have a credible economic policy, you are simply not at the races”?

Why is it—[Interruption.]

[Mr Speaker]

Order. Whatever people think of what is being said on either side of the House, they must not shout their heads off. The Prime Minister and the Leader of the Opposition will be heard, and that is the end of it.

[The Prime Minister]

The fact is that our plan is supported by the CBI, by the Institute of Directors, by the business organisations, by the IMF, and by the OECD. The right hon. Gentleman cannot even get support from his own former Cabinet Ministers. The former Home Secretary says this:

“I think the economic proposition that Labour puts at the moment is unconvincing.”

If the right hon. Gentleman cannot convince his own party, how can he convince the country?

[Edward Miliband]

The Conservative Chair of the Prime Minister’s Select Committee says that his policies on growth are “inconsistent” and “incoherent”. He obviously cannot convince him, can he?

Of course, typically, the Prime Minister did not answer the question on women’s unemployment, so let me tell him: women’s unemployment is at its highest since 1988—the last time there was a Conservative Government in power. I have to say that instead of apologising four months late to my hon. Friend the Member for Wallasey (Ms Eagle) for saying, “Calm down, dear”, he should be apologising to the women of this country for what he is doing to our economy.

Let me ask the Prime Minister another question that maybe this time he will answer. Last year, in his Budget, the Chancellor announced a flagship policy on growth. He said that the national insurance holiday for start-up firms would help 400,000 businesses. Can the Prime Minister tell the House how many businesses have actually taken part?

[The Prime Minister]

Seven thousand.

On the issue of women in work, of course I want to see more women in work, and there are 50,000 more women in work than at the time of the last election. It is this Government who have introduced free child care for all vulnerable two-year-olds, who have extended child care for three and four-year-olds, who have increased the child tax credit by £290, and who, for the first time, have announced that we will be giving child care to all people working fewer than 16 hours, helping hundreds of thousands of women and families out of poverty into work and into a better life. That is what we are doing.

The question the right hon. Gentleman must address is the big picture, which is this: he cannot convince the former Home Secretary, the former Trade Minister or the former Chancellor that he has got any idea of what to do with the economy. The reason is that if we adopted his plan, we would not be working with the IMF to sort out the eurozone—we would be going to the IMF to ask for a loan.

[Edward Miliband]

In case the Prime Minister has not realised, when the Chancellor says that 400,000 firms will benefit and only 7,000 are, that should tell him something: it should tell him that his policies are not working. That policy is not working; his plan is not working. Why does he not, just for once, agree with us: cut VAT and put more money into people’s pockets, help the construction industry to get moving, and invest in getting young people back to work by having a bankers’ bonus tax?

[The Prime Minister]

When is the Labour party going to learn that one cannot borrow one’s way out of a debt crisis? It left us the biggest deficit, the most leveraged banks and the most indebted households, and what is its answer? It is to borrow more money. Is it any wonder that the former Trade and Investment Minister, Digby Jones, described the Labour leader’s conference speech as

“divisive and a kick in the teeth for the only sector that generates wealth that pays the tax and creates the jobs this country needs.”?

That is what a former Labour Minister said about a Labour policy. That is why the Labour leader has no credibility whatsoever.

[Edward Miliband]

What a terrible answer. I will take on the companies in this country that are not doing the right thing, such as the energy companies. We are seeing change in the energy sector today because of what I said.

On the day of the worst unemployment figures in 17 years, the Prime Minister is fighting to save the job of the Defence Secretary, but doing nothing to save the jobs of hundreds of thousands of people up and down this country. There is one rule for the Cabinet and another rule for everyone else.

[The Prime Minister]

The previous Labour leader thought that he had saved the world; after that answer, I think that this Labour leader is Walter Mitty. The Labour party has to accept some responsibility for the mess it made of the economy. It is the party that borrowed too much, spent too much, left us with unregulated banks and left us with the mess that we have to clear up. When one sees those two sitting on the Front Bench who worked for so long in the Treasury, one has to ask, one would not bring back Fred Goodwin to sort out the banks, so why would one bring them back to sort out the economy?

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

Has my right hon. Friend noticed that since I put the point to him last month, the head of our Serious Fraud Office, Mr Richard Alderman, has publicly deplored the fact that no senior British bankers have been prosecuted for their irresponsibility, and has urged that legislation be introduced as soon as possible to empower his office to prosecute such offenders?

[The Prime Minister]

It is important that inquiries are conducted into what went wrong at RBS and HBOS, because we are left clearing up a mess made by the irresponsibility of others. If there is room for criminal prosecutions, of course those should happen. Our responsibility is to ensure that we regulate the banks and the financial industry properly in future. That is why we have put the Bank of England back at the heart of the job.

[Nia Griffith (Llanelli) (Lab)]

Q2. Will the Prime Minister publish a full list of all the Ministers and Downing street staff who, since May 2010, have met Mr Adam Werritty in an official or social capacity, including whether he as Prime Minister has met him?

[The Prime Minister]

I am very happy to look at that.

[Lorraine Fullbrook (South Ribble) (Con)]

Does the Prime Minister agree that in the light of the difficult times encountered by some of my constituents in South Ribble who work for BAE, it is even more important that this Government continue their excellent support for exports and their continued investment in the development of the Typhoon and new unmanned aerial vehicle systems?

[The Prime Minister]

I agree with my hon. Friend. Obviously, the position at BAE has been of concern. That is why we immediately put in place plans for an enterprise zone on each side of the Pennines to help with that important business. BAE is a great British company. It has a huge forward order book, not least because of our defence budget, through which we are investing in Typhoons, aircraft carriers and unmanned aerial drones. I will do everything I can to support that company, including promoting its exports abroad. I have had conversations with the Japanese and will soon be talking to the Saudi Arabians and others to do all that we can do to make sure that this great British company goes on being a great British success.

[Mr Andy Slaughter (Hammersmith) (Lab)]

Q3. Imperial Healthcare Trust, which offers outstanding clinical care and research in three major hospitals in west London, is being forced to make 5% per annum cuts for five years, so that is 25% of its £900 million a year budget. How does that fulfil the Prime Minister’s promise not to cut health services to my constituents?

[The Prime Minister]

We are increasing NHS spending throughout this Parliament, and, I have to say, that is a complete contrast with the Opposition’s policy. They now have a new health spokesman. I was worried that I would not have the same quantity of quotes from the new health spokesman, but he has not disappointed. He said this—very clear, very plain:

“It is irresponsible to increase NHS spending in real terms”.

That is Labour’s position—that it is irresponsible to increase health spending. We disagree.

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

Q4. Too many children in Britain today live in families that do not provide them with the loving and stable environment that they deserve, and that has led to many of our most pressing social problems. Would the Prime Minister agree that this Government need to do all they can to help some of Britain’s most problem families?

[The Prime Minister]

I completely agree with my hon. Friend. If we look at the evidence, we see that some of the most troubled families in our country get a huge number of interventions from the police, social services, education and the rest of it, but no one is really getting in there to help turn those families around, change what they do and give them a better chance. So we are establishing a new unit under the leadership of Louise Casey, who I think has been a superb official over the past decade, and we are going to be putting huge resources into turning around the 120,000 most troubled families in our country. I think we can make a huge difference for those families, and we can reduce the burden that they place on the taxpayer at the same time.

[Mr Denis MacShane (Rotherham) (Lab)]

Will the Prime Minister instruct our ambassador in Kiev to make representations on behalf of the Government and Parliament about the appalling show trial and prison sentence handed down to Yulia Tymoshenko, the former Prime Minister? Prime Ministers do make mistakes and lose elections, as she did, but she has been put on trial for policy decisions that she took. Will the Prime Minister make it clear—I am glad the Foreign Secretary is briefing him—that Ukraine will not be able to open membership talks with the EU, and that any hopes of liberalising visa access will go out of the window because of this disgraceful Stalinist show trial and sentence?

[The Prime Minister]

We completely agree that the treatment of Mrs Tymoshenko, whom I have met on previous occasions, is absolutely disgraceful. The Foreign Secretary has made a very strong statement about this. The Ukrainians need to know that if they leave the situation as it is, it will severely affect their relationship not only with the UK but with the European Union and NATO.

[Richard Fuller (Bedford) (Con)]

Q5. Small business, not more Government debt, is key to job creation, and entrepreneurship is a noble endeavour, so will the Prime Minister join me in welcoming the support of Bedfordshire university, Cranfield university, Colworth science park, Bedfordshire on Sunday and 100 business leaders in my constituency for setting up an investment fund and mentoring scheme to support early-stage businesses in Bedford? Will he ask his Ministers to work with me to see whether that can be replicated in other towns across the country?

[The Prime Minister]

I pay tribute to my hon. Friend for what he is doing in Bedford. This Government recognise that it is going to be small businesses that will provide the growth, jobs and wealth that this country needs. That is why we have an agreement with the banks to increase lending to small businesses, why we are providing extra rate relief to small businesses, why we are giving the smallest businesses a holiday from new regulation and why we have got the one-in, one-out rule for new regulation. I applaud all efforts at a local level to give small businesses the mentoring, help and support that they need to grow.

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

Q6. Responding to the Science and Technology Committee’s report on forensic science, a Home Office Minister has said:“We don’t agree with the committee’s report. It mis-states a number of very significant points.”Given that the Home Office’s financial case was 50% adrift, and that it has now agreed with our argument that the national archive should be protected, will the Prime Minister urgently intervene and review the decision to close the Forensic Science Service? The country and the profession are now losing key scientific staff.

[The Prime Minister]

I will certainly look at what the hon. Gentleman says, but I looked at that decision in some detail at the time, having known well the Forensic Science Service from when I worked at the Home Office many years ago. The evidence was pretty overwhelming that the model was not working and that change was needed. That is what has happened. Sometimes it is better to make that change rather than endlessly review it.

[Mr Mark Spencer (Sherwood) (Con)]

The Prime Minister inherited a welfare system in which families were able to claim £2,000 a week in housing benefit, and in which some working families were worse off than those who were on benefits. What can he do to help those hard-working families in Sherwood who get out of bed and work hard because of their self-pride and responsibility?

[The Prime Minister]

My hon. Friend speaks for millions in the country when he says that what people want is a welfare system that helps people who want to put in, work hard and do the right thing. What we are doing, first, is putting in place a cap so that we do not have those absurd amounts of money in housing benefit going to individual families—as he says, sometimes, it is £2,000 a week. Secondly, universal credit will ensure that it is always worth while people working and always worth while working a little harder. Let us see whether the Labour party, after a decade of giving people something for nothing, are prepared to back that by voting for the tough caps in the Welfare Reform Bill.

[Pat Glass (North West Durham) (Lab)]

Q7. If a Minister breaks the ministerial code, should he or she keep their job?

[The Prime Minister]

The ministerial code is very clear that, in the end, it is for the Prime Minister to decide whether someone keeps their job or not. In the case of the Defence Secretary, when the Leader of the Opposition has called for an inquiry by the Cabinet Secretary, and when I have established such an inquiry, it is very important that we allow him to do his work to establish facts, and then a decision can be made. However, let me be clear: I think that the Defence Secretary has done an excellent job clearing up the complete mess that he was left by Labour.

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

Retirement ages must go up, but the timetable in the Pensions Bill is too fast for many women. I was pleased to hear the Prime Minister say earlier that he was looking at transitional arrangements, and I would hope that those will result in a significant slowing down of the increase in retirement age for many women.

[The Prime Minister]

As I have said, we have looked at this issue very carefully and we will be making an announcement shortly. We have to look at the most difficult cases of people who will have to do quite an extra amount of working time, but clearly it is right—one must look at the big picture—to equalise men’s and women’s pension arrangements, and to move to 66, given the extra longevity that we enjoy as a country. Given that, I hope that the hon. Gentleman will be pleased when the announcement is made.

[Keith Vaz (Leicester East) (Lab)]

Q8. Both the Prime Minister and the Leader of the Opposition are on record as supporting gender equality for future royal successions. Will the Prime Minister update the House on the consultation that he and the Deputy Prime Minister are having with other Commonwealth leaders on this issue? Does he agree that it is better that we resolve this matter before rather than after any future royal children are born?

[The Prime Minister]

I certainly believe that this issue should be sorted out—I am on the record as believing that, and I am sure that across the House there will be widespread support for it. In the consultation, I have written to the Heads of State and Prime Ministers of the other realms concerned, and we will have a meeting on the matter at the Commonwealth Heads of Government conference. This is not an easy issue to sort out. Many may have worries about starting a parliamentary or other legal process, but I am very clear that it is an issue that we ought to get sorted, and I would be delighted to play a part in doing that.

[Esther McVey (Wirral West) (Con)]

Does the Prime Minister agree with the recent advice from the shadow Treasury Minister, who said that we must not and cannot pick good winners and losers? To conceive of such a simplistic “sinners and winners” model shows a distinct misunderstanding of business?

[The Prime Minister]

My hon. Friend makes an important point. The greatest need in our economy right now is to generate wealth, jobs and investment. What did Labour do at its conference? It just launched a big attack on British business, when that is what will help us out of these difficulties.

[Alun Michael (Cardiff South and Penarth) (Lab/Co-op)]

Q9. Was the Prime Minister aware before today that his chief spokeswoman was a former colleague of Mr Adam Werritty?

[The Prime Minister]

As I have said, this whole issue is being looked at by the Cabinet Secretary, and he will produce his report. I would ask people to have a little patience—let the facts be established and the questions answered, and then we can move ahead.

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

Is my right hon. Friend aware that nearly 40 Government Members have signed an amendment in my name requiring that all offenders convicted of using a knife in a threatening or endangering fashion will receive a custodial sentence, not only those over 18? Will he consider supporting this amendment?

[The Prime Minister]

I shall certainly look closely at what my hon. Friend says. I know that the Justice Secretary is doing this too. We want to move ahead with a mandatory sentence for adults, and we shall look very closely at the arguments that my hon. Friend makes.

[Kelvin Hopkins (Luton North) (Lab)]

Q10. Sir John Major said four days ago that the Government should use the euro crisis as an opportunity to loosen EU powers over Britain. His first priority was the common fisheries policy. When will the Prime Minister take Sir John’s advice and tell the EU that Britain intends to withdraw from the CFP?

[The Prime Minister]

I always listen carefully to Sir John’s advice, and he gives me some excellent advice. In the short term, Britain desperately needs to get behind the solution to the eurozone crisis, because it is having a chilling effect on the whole of the European economy, and the American economy as well. That is the first priority. I accept, however, that at the same time as doing that it will be important to get some safeguards for Britain. As eurozone countries go ahead and sort out their problems, we need safeguards to ensure that the single market goes on working for the United Kingdom.

[Simon Hart (Carmarthen West and South Pembrokeshire) (Con)]

Last weekend, B&Q opened a new store in Pembroke Dock creating 25 jobs and Ledwood engineering advertised 25 new jobs in the town. Jobcentre Plus in Pembroke Dock has 249 jobs on offer. Does the Prime Minister agree that there would be further good news if the banks honoured their pledge to commit to credit flow, and will he keep the pressure on and encourage businesses in Wales to advertise even more jobs?

[The Prime Minister]

We shall certainly keep the pressure on the banks. It is worth making the point that in spite of the difficulties, there are 500,000 new private sector jobs in our economy compared with the time of the election. However, we need to have in place all the things that help businesses to expand and grow. Bank finance is just one of those things. We have the Merlin agreement, which is increasing lending to small businesses, and we also have what the Chancellor has said about credit easing to ensure that we consider other ways of expanding credit in our economy.

[Jonathan Ashworth (Leicester South) (Lab)]

Q11. This week, I had the privilege of meeting Hafsah Ali and Joseph Hayat from the Ready for Work campaign. They are impressive young people campaigning against rising youth unemployment. Will the Prime Minister tell us what has happened to his vow earlier this year to reverse the trend of rising youth unemployment? Will he also tell the House when he last met a young unemployed person?

[The Prime Minister]

Youth unemployment has been rising since 2004—it went up during the growth years as well as in the difficult years. We need a comprehensive strategy that deals with all the problems of youth unemployment, including the fact that there are too many people leaving school aged 16 who spent 13 years under a Labour Education Secretary—so the Labour party needs to take some responsibility—and who left school without qualifications to help them get a job. This is about ensuring that we have better education, a welfare system that helps people into work and a Work programme that provides not phoney jobs, as the future jobs fund did, but real work for real young people.

[Henry Smith (Crawley) (Con)]

A recent TaxPayers Alliance report revealed—[Hon. Members: “Ahh!”]—that 38 union leaders were remunerated at more than £100,000 each, including Derek Simpson of Unite, who received more than £500,000. Does the Prime Minister agree that it is time for union boss pay restraint?

[The Prime Minister]

It is interesting that Labour Members always listen to the trade unions, but never to the TaxPayers Alliance. One reason is that they do not want to hear about excessive pay in the public sector, local government or among their paymasters, the trade unions.

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

Here is another question that the Prime Minister will not want to answer. Will he get a grip of his Back Benchers following last night’s debacle in the Chamber relating to the business of the House on 17 October? Does he understand that the perception out there in the real world is that some MPs would rather talk about their own pensions than discuss a 22-year-old injustice and the deaths of 96 men, women and children?

[The Prime Minister]

Let me answer the hon. Gentleman directly. We are going to protect the time for that absolutely vital debate. On the issue of MPs’ pensions, it is very clear that we have to show restraint at a time when the rest of the public sector is being asked to show restraint. So because of what happened last night, there will have to be a debate, but it will not eat into the time for the very important debate that he mentioned and which I know many Members care deeply about.

[Christopher Pincher (Tamworth) (Con)]

What action is my right hon. Friend taking to reintroduce rigour into the education system and end the ridiculous situation under the previous Government of 22% of students doing proper academic studies?

[The Prime Minister]

The Education Secretary is doing a superb job of focusing schools on results, including in English and maths, ensuring that we look at the English baccalaureate, which includes the core subjects that employers and colleges really value, and doing some simple and straightforward things that were not done for 13 years, such as ensuring that punctuation and grammar actually count when someone does an exam.

[Ms Margaret Ritchie (South Down) (SDLP)]

The Prime Minister met the Finucane family yesterday, so will he now reflect on the comments made by an Taoiseach in relation to that meeting and the outcomes, and the agreement made by both Governments at the Weston Park talks in 2001 that there should be an independent public inquiry?

[The Prime Minister]

Of course I have reflected incredibly carefully on what was said yesterday, and I have reflected on this whole issue for many months since becoming Prime Minister. I profoundly believe that the right thing for the Finucane family, for Northern Ireland and for everyone in the United Kingdom is not to have another costly and open-ended public inquiry, which may not find the answer, but instead for the British Government to do the really important thing, which is to open up and tell the truth about what happened 22 years ago. We do not need an inquiry to do that; that is why my right hon. Friend the Secretary of State for Northern Ireland will be making a statement explaining exactly how we are going to do it and who will be involved. In the end, the greatest healer is the truth. Frank acknowledgement of what went wrong, an apology for what happened—that is what is required. Let us not have another Saville process to get there; let us get there more quickly and do the right thing.

[Mr Lee Scott (Ilford North) (Con)]

Will my right hon. Friend join me in welcoming the news that it seems that Gilad Shalit will be released in the next few days, which could well go a long way towards peace in the area?

[The Prime Minister]

I am very grateful to my hon. Friend for raising this case. What that young soldier has been through for those weeks, months and years is something that anyone in this House would find difficult to contemplate. If it is the case that he will be coming home soon, I wish him, his family and everyone in Israel well.

[Mr Speaker]

Order. The following statement is on an extremely important matter. May I appeal to right hon. and hon. Members who are leaving the Chamber to do so quickly and quietly, so that I and those remaining can hear the Secretary of State for Northern Ireland?