Secondary International Competitiveness and Growth Objective (FSR Committee Report)
Lord Hill of Oareford Excerpts(2 weeks, 5 days ago)
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Lord Hill of Oareford (Con)
My Lords, I declare an interest as a board member of Intercontinental Exchange in the United States, and as an adviser in Europe to Santander and Visa Europe. This enables me to see the very different regulatory approaches in different jurisdictions, which is, indeed, one of the themes that we have already referred to today.
I am very grateful to my noble friend Lady Noakes—in keeping with tradition, I almost called her Lady Bowles, an in-joke among committee members—for setting out the range of issues so clearly at the beginning and for taking on the burden of chairing us. I much enjoyed the comments from the noble Lord, Lord Kestenbaum. How sad we are that he is no longer with us—on the committee, I mean; it is not that the noble Lord sits before us as a hologram, or agentic AI as I believe it might be called. I want to highlight a couple of points from the deliberations of the committee and the report.
First, as I think the noble Lord, Lord Vaux, has already said, the secondary international growth and competitiveness objective has made and is making a difference. I admit that when it was introduced I was initially sceptical and thought it might just be a piece of window dressing. But in fact, in the hands of motivated Ministers—which I am glad to say we have had—it has turned out to be of real use. It has helped us open up a more intelligent discussion about risk. Direct parliamentary accountability through our committee, backed up by a system of metrics, has also given us some scaffolding, off which we have been able to build a better debate and a better system of holding regulators to account. I think we have seen how the regulators themselves—it must be said that they were initially extremely doubtful about this requirement, if not resistant to it—have started to warm to it. Indeed, they now argue that it is helping them to improve both their regulatory and their supervisory practice. So far, so good.
But as our report points out, and as my noble friend Lady Noakes has already said, we should think of this whole area as a work in progress, not as a fixed point. After all, our own risk appetite as a society is not fixed, nor is that of our international competitors. Indeed, we have only to look at recent regulatory developments in the United States since we started our inquiry to see just how dynamic and competitive that landscape is.
Therefore, as the report argues, we need to keep the metrics by which we judge the performance of the regulators under constant review. We should seek to tighten them, to be more ambitious, to raise the bar and to keep on pushing for better performance. Here, as we have already heard, the Government’s response to the committee’s recommendations was, I have to say, disappointing. Metrics may not sound very dramatic or poetic, but they are the means by which we can shine a light into the world of regulation and supervision. I argue that the Government should be more ambitious here, and so should our regulators.
I will draw attention to one other area: the question of whether we could do more to differentiate between how we think about regulating wholesale and retail markets. We raised this in the report, and we heard evidence that suggested that attitudes of mind developed in the field of consumer protection are, as it were, leaking across into the regulation of wholesale markets. Here, obviously, risk appetite and sophistication of investors are completely different, and it is in wholesale markets that London’s claim to be a global financial centre will be won—or lost. Ministers have given us hints that they think it is worth thinking more carefully about this wholesale/retail distinction, and perhaps the Minister might feel able to give us another hint today.
I have a final word for the financial services sector itself. Just as we want to prevent mission creep from regulators and supervisors, so the sector needs to prevent it in its own compliance departments, legal advice and board discussions. If we want to have a new attitude in Britain that is more accepting of risk, we cannot just blame everything on the poor old regulators. Yes, they have their share of responsibility, but the primary responsibility surely rests with the politicians, who have for too long outsourced the management of risk.
I believe that this report starts to unpack many of these issues, and it helps us in the long march of improving how we regulate and supervise financial services, unlocking more innovation and, ultimately, more capital to invest in our economy.
Syria: Refugees
Lord Hill of Oareford Excerpts(12 years, 4 months ago)
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The Chancellor of the Duchy of Lancaster (Lord Hill of Oareford) (Con)
My Lords, it is the turn of the Labour side.
Lord Judd
My Lords, the humanitarian challenge is formidable. Of course, it is not just a matter of relief; it is also a matter of long-term investment in children—their education and their health—because they are going to be displaced for a long time to come. What are the Government doing to face up to the immense regional political implications of what has happened in the sense that almost a third of the population in Jordan will soon be refugees? That is acutely destabilising, and it is the same story in Lebanon, with all kinds of dangers for the future in terms of extremism, political disruption and the rest. Can we promote international discussions about how to have a positive pre-emptive regional approach towards the long-term political issues?
European Commission: Staffing
Lord Hill of Oareford Excerpts(12 years, 4 months ago)
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The Chancellor of the Duchy of Lancaster (Lord Hill of Oareford) (Con)
My Lords, we are wasting time. It is the turn of the Labour Party.
Lord Foulkes of Cumnock
Surely the noble Lord—as a Liberal Democrat Euro-enthusiast; and I am also a Euro-enthusiast—would agree that the problem has been exacerbated by the uncertainty over our future position within Europe. Would he, if he were 20 or 30 years younger, really apply for such a risky position?
Syria and the Use of Chemical Weapons
Lord Hill of Oareford Excerpts(12 years, 7 months ago)
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Lord Hill of Oareford
That this House takes note of the use of chemical weapons in Syria.
The Chancellor of the Duchy of Lancaster (Lord Hill of Oareford)
My Lords, as the Chief Whip has just reminded us, a large number of people want to speak today; the House is full. That shows why it was right to recall Parliament, a decision I know the Opposition strongly supported.
In setting out the Government’s position on the use of chemical weapons in Syria, I hope to do three things. I want to set out the evidence that we have of the use of chemical weapons. Then I want to set out the Government’s case for action. I will then explain the process we intend to follow, both here and in the international community.
First, however, it is important to be clear what the issue that we are considering today is not. It is not about taking sides in the Syrian conflict. It is not about invading. It is not about regime change, or even about working more closely with the Syrian opposition. I know that this afternoon we will hear from many noble Lords with a huge amount of experience—diplomatic, political and military—and I am sure that we will hear many nuanced arguments and that there will be discussion about the complexities of the situation. I know that we will benefit greatly from that advice but, in essence, the issue is really very simple. It is this: what should our response be to the large-scale use of chemical weapons; and, with that response, what message do we want to send to the rest of the world about their use?
To help us in our debate, the Government have placed a number of documents in the Library. There is a summary of the Government’s legal position, making explicit that military action would have a clear legal basis; and there are the key judgments of the Joint Intelligence Committee, making clear its view of what happened and who is responsible. I hope that noble Lords will find that information useful.
I will start with the evidence that we have. Medecins Sans Frontieres reported that in just three hours on the morning of 21 August, three hospitals in the Damascus area of Syria received approximately 3,600 patients with symptoms consistent with chemical weapon attacks. Thousands of social media reports and at least 95 videos record evidence of attacks in at least 11 different locations in the Damascus area. There are horrible pictures of bodies showing signs of nerve-agent exposure, including muscle spasms and foaming at the nose and mouth. At least 350 were killed. These deaths and injuries were caused by weapons that have been outlawed for nearly a century.
The fact that the most recent attack took place is not seriously disputed. The Syrian Government said that it took place, but blamed the opposition. Even the Iranian president has said that it took place. The Syrian regime resisted calls for immediate and unrestricted access for UN inspectors, while artillery and rocket fire in the area reached a level around four times higher than in the 10 preceding days. Examining all this evidence, together with the available intelligence, the Joint Intelligence Committee has made its judgments, published and placed in the Library in the form of a letter from the chairman of the committee to the Prime Minister. The committee reached its judgments in line with the reforms puts in place after the Iraq war by the noble Lord, Lord Butler of Brockwell. The letter states that,
“there is little serious dispute that chemical attacks causing mass casualties on a larger scale than hitherto … took place”,
on 21 August. So far as the Syrian opposition are concerned, the letter states:
“There is no credible intelligence or other evidence to substantiate the claims or the possession of CW by the opposition”.
The Joint Intelligence Committee therefore concluded that it is not possible for the opposition to have carried out a chemical weapons attack on this scale. It says:
“The regime has used CW on a smaller scale on at least 14 occasions in the past. There is some intelligence to suggest regime culpability in this attack. These factors make it highly likely that the Syrian regime was responsible”.
The JIC chairman, in his letter, makes this point absolutely clear and says that,
“there are no plausible alternative scenarios to regime responsibility”.
To believe that the Syrian opposition were behind the attack, we would have to believe that they would use, on a large scale, weapons which we have no evidence that they have, delivered by artillery or by air power which they do not possess, killing hundreds of people in areas already under their control. That is simply not credible.
Whatever disagreements we may have about the complex situation in Syria, there is surely no disagreement that the use of chemical weapons is wrong. For nearly a century, the international community has worked to build a system of defences to protect mankind against their use. The international agreement outlawing the use of chemical weapons was signed by Syria and dates back to the period after the Great War, a war in which 90,000 soldiers died from mustard gas, chlorine and phosgene and up to 1.3 million were blinded or burned by them.
The Geneva Protocol reflected a determination that the events of the Great War should never be repeated. It said that, whatever happens, these weapons should not be used. Our judgment is that this is the first significant use of chemical weapons this century. Together with the previous 14 smaller-scale attacks, this is the only instance of regular and indiscriminate use of chemical weapons by a state against its own people for at least 100 years.
We should not be interfering in another country’s affairs except in the most exceptional circumstances. It would have to be a humanitarian catastrophe, and it would have to be as a last resort. By any standards, this is a humanitarian catastrophe. If there are no consequences for the large-scale use of chemical weapons, there would be nothing to stop Assad and other dictators from using them again and again. If there are no consequences for breaking international agreements, the agreements themselves are rendered meaningless. Decades of painstaking work to construct an international system of rules and checks to prevent the use of chemical weapons and to destroy stockpiles would be undone and a 100 year-old taboo would be breached.
There are those who argue that, in considering our options, we should be guided only by what is in the British national interest. I agree. But surely it is in our national interest, and that of all nations, to ensure that the rules about chemical weapons are upheld. That is why the Government argue that we should play our part in a strong response from the international community, first at the United Nations, but also potentially including legal and proportionate military action; action designed simply to prevent the further use of chemical weapons and similar human distress.
The Attorney-General has confirmed that this use of chemical weapons in Syria constitutes both a war crime and a crime against humanity. The Cabinet considered the Attorney’s advice this morning and a summary of the Government’s legal position has been placed in the Library, as I said. This summary sets out that the principle of humanitarian intervention provides a sound legal basis for the deployment of UK forces and military assets in an operation to deter and disrupt the use of chemical weapons.
We have evidence of the use of chemical weapons and a firm and sound basis to act, but we propose to take further steps both here and at the United Nations before we do so. First, the United Nations weapons investigators in Damascus must complete their work and brief the United Nations Security Council. We will also make a genuine attempt to reach a condemnatory Chapter 7 Resolution in the Security Council, backing “all necessary measures”. We yesterday put a new draft resolution to our Security Council colleagues. In doing that, we must pursue every avenue at the United Nations, every diplomatic channel, every option for securing the greatest possible legitimacy for any action we take. Only once that route has been exhausted would the Prime Minister return to the House of Commons to seek a further resolution of that House to endorse British involvement in direct military action.
There is a series of important questions about any potential operation to deter and disrupt the use of chemical weapons to relieve humanitarian suffering. Let me try to deal with these. The first is: how can we be sure that the military action envisaged by the United States of America or its allies would work? Of course, when dealing with a dictator like the Syrian president, there can be no guarantee of dissuading him from further use of chemical weapons. But our judgment reflects the assessment that Assad is likely to fear and respect a strong and focused response. Of course, there is no action without risk. But alongside the risks of action, we also have to weigh the risks of inaction.
We know that in President Assad we have a man who has stockpiled chemical weapons, and has used them repeatedly and indiscriminately in the past. He has repeatedly tested our resolve to stand up to his crimes. If we do not act, he and others will, I believe, take it as a signal that he can use chemical weapons again and again. That would risk not only further chemical attacks and further human suffering in Syria, but also greater proliferation of these weapons across the region and the world, with all the consequences that could bring. We should not tolerate the risks of inaction or allow Assad and other dictators to conclude that they can continue to deploy chemical weapons against their people with impunity.
There are those who ask as well whether we are in danger of getting sucked into a new war in the Middle East. To them I would say that the issue before us today is not about sanctioning wider involvement in Syria, horrible and devastating as that conflict is. It is purely about responding specifically to the large-scale use of chemical weapons and acting to deter and prevent them being used again.
The next question is whether we are in danger of undermining our ambitions for a political solution in Syria. The Government do not believe that there is a choice between, on the one hand, acting to prevent chemical weapons being used against the Syrian people, and on the other, continuing to push for a long-term political solution. We obviously need to do both, and we remain committed to using diplomacy to end this war with a political solution. But, for as long as Assad is able to defy international will, he will feel little if any pressure to come to the negotiating table. Far from undermining the political process, a strong and military response to the use of chemical weapons can actually strengthen it.
Some ask whether action over chemical weapons could further destabilise the region. The region has already been profoundly endangered by the conflict in Syria. Lebanon faces sectarian tensions as refugees flood across the border. Jordan is coping with a huge influx of refugees. Turkey, our ally in NATO, has suffered terrorist attacks and shelling from across the border. However, standing by as a new chemical weapons threat emerges will not alleviate those challenges; it will only deepen them. That is why the Arab League has been so clear in calling for international action. A region long beset by conflict and aggression needs clear international laws and people who are prepared to stand up for them.
There is also the question of whether intervention, however well motivated, could risk radicalising more young Muslims, including here in Britain. This is a vital question and one that the National Security Council addressed yesterday. The Government received considered analysis from our counterterrorism experts and their assessment is that, while there is no room for complacency, the legal, proportionate and focused actions that we would propose would not be a significant new cause of radicalisation and extremism. In fact, young Muslims in the region and here in Britain may well be wondering if the world will ever step up and respond to the pictures of Muslims in Syria suffering horrific injuries and death from chemical weapons. I would argue that the message to give them is that we will.
Our Parliament has on relatively few occasions been asked to consider whether to endorse the principle of the use of military force. It is inevitable that today’s debate here, and particularly in the other place, will be viewed from the perspective of the debates held before our interventions in Libya and indeed in Iraq. Given that perspective, we are right in Parliament and as a nation to be cautious and to strive to be consensual. That is why we have published the summary of our legal position and the key judgments of the Joint Intelligence Committee. It is why we have deferred our decision until the United Nations inspectors have completed their immediate work and briefed the Security Council. It is why we want to try to secure a UN Security Council resolution. But the situation today is not the same as in 2003 on the eve of the Iraq war. We are not invading another country; we are not searching for weapons—sadly, we have already seen their use. In 2003, Europe, NATO and the Arab League were in disagreement; today, they are in agreement. The Arab League has issued a statement holding the Syrian regime “fully responsible” and asking the international community,
“to overcome internal disagreements and take action against those who committed this crime”.
Australia, Canada, Turkey and India, to name but a few, are also in agreement.
The question is a simpler one now than then. It is how to respond to one of the worst uses of chemical weapons in 100 years. Do we conclude that it is all too difficult, and send the message to Assad and others that they may use chemical weapons with impunity; or should we, as the Government propose, act in a legal, proportionate and focused way, with the single objective of preventing the further use of chemical weapons, to relieve humanitarian suffering? I beg to move.
Critical National Infrastructure: Ownership
Lord Hill of Oareford Excerpts(12 years, 8 months ago)
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The Chancellor of the Duchy of Lancaster (Lord Hill of Oareford)
We shall hear from the Cross Benches first.
Lord Bilimoria
My Lords, today the former Governor of the Bank of England has taken his seat, and we welcome him. His successor is a Canadian. How many other countries would have a foreign national as the governor of their national central bank? We do. Do not the Minister and the Government think that we should be proud that we are one of the most open economies in the world, and that that is a great strength to this country? Regardless of that, and on the other hand, how much longer are the Government going to dither and procrastinate about increasing our airport capacity in London?
EU: Subsidiarity Scrutiny
Lord Hill of Oareford Excerpts(13 years ago)
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The Chancellor of the Duchy of Lancaster (Lord Hill of Oareford)
My Lords, we have already had two questions from Cross-Benchers, so it is the turn of the Liberal Democrats.