Turkey: Human Rights

Lord Reid of Cardowan Excerpts

Monday 29th January 2018 Lords Chamber

[Lord Ahmad of Wimbledon]

I know that the noble Baroness has been a very strong campaigner on this issue, and she knows for a fact that the United Kingdom has been, and continues to be, very vocal on it. We have a very strong relationship with Israel which allows us to have candid conversations in which we stand up for the rights of the Palestinian people and of the children held in detention in Israel. I reiterate that the United Kingdom believes that the long-term solution to the crisis in the Holy Land and the Middle East that is ripping apart communities at times is a two-state solution, and the United Kingdom stands by that.

[Lord Reid of Cardowan (Lab)]

My Lords, in view of the Minister’s answers regarding our support for Turkey’s position, is it not ironic that the will of the people, to which he and other Ministers keep referring, was persuaded, at least in substantial part, by the dreadful rumours that 76 million Turks would join the European Union?

[Lord Ahmad of Wimbledon]

The noble Lord may speculate, and there will be different reasons as to why people voted, but I do not agree. I accept that certain elements of the campaign were not desirable. I made my position clear at that time, as did the Government. That applied to those on both sides of the campaign. However, the fact is that, in a referendum voted for by both Houses, the majority of people voted to leave the European Union. We are not listening to the likes of Mr Barnier, and we do not need his direction; we needed the direction of the British people, they have given it and we are following it.

Asset Freezing (Compensation) Bill [HL]

Lord Reid of Cardowan Excerpts

2nd reading (Hansard) : House of Lords
Friday 27th October 2017 Lords Chamber

[Lord Reid of Cardowan (Lab)]

My Lords, speaking briefly in the gap, I first congratulate the noble Lord, Lord Empey, for the persistence that he has shown on this issue. I support this Bill, despite the fact that I do not necessarily agree with everything that has been said in the course of the proposal and support. It would be wrong of me not to put on the record a correction to the caricature that was given, especially by the noble Lord, Lord Rogan, of the letters that were sent to the so-called on-the-runs. They did nothing more than inform those people—who were not being pursued by the police—that they were not being pursued by the police. In the case of Downey, a mistake was made and that is why he could use the letter.

Notwithstanding that correction, I support this Bill and I do so for a reason that has not yet been outlined: when I was Secretary of State for Northern Ireland, I was extremely aware, like everyone else who has held that position, of the number of victims on all sides of the community. Some people called it the Troubles; it was a war. It was a war against the best, most effective guerrilla army in western Europe at the time, and there were victims on all sides. There was, however, an imbalance in the opportunities that some victims had to claim compensation. If a person claims that they were the victim of a state, there is a whole plethora of apparatus, systems and processes of law that allow them much more opportunity to claim compensation against the state than if they were the victim of a terrorist organisation, by virtue of the fact that they do not have the status that a state has. Therefore, anybody who claimed that they had suffered as a victim of British violence had opportunities to claim compensation that were denied to many others. In this case, as the noble Lord, Lord Empey, has pointed out, they were in fact the victims, directly and indirectly, of a state: Libya. So, for the first time, the victims of terrorism in Northern Ireland would have, if supported by the British Government, the opportunity that they have never had previously to use the very laws that those who have claimed to be the victims of British state violence have had.

This House should therefore support the Bill of the noble Lord, Lord Empey. I believe that, where the state of Libya has been involved through the head of state, Gaddafi, there was a direct relationship between the finance and the resources supplied for the use of terrorism and the effects on the victims in Northern Ireland. With that, I merely add that the persistence that the noble Lord, Lord Empey, has shown has been commendable and this House should support him in his endeavours.

Raqqa and Daesh

Lord Reid of Cardowan Excerpts

Tuesday 24th October 2017 Lords Chamber

[Lord Ahmad of Wimbledon]

The right reverend Prelate is right to raise the issue of minorities and particularly the Christian minorities in Syria. The crimes committed in Aleppo have been a tragic example of the regime of Bashar al-Assad. I revert to the point I made earlier that any support that the British Government give to those returning is done to ensure their safety and security. We have begun to do exactly that in ensuring that, in the areas where people are returning, medical facilities are available including to all minorities who have been displaced. Let us not forget that over 50% of the Syrian population has been displaced. It will take time to ensure that they can return to their homes. Underlining our approach, both safety and security must prevail.

[Lord Reid of Cardowan (Lab)]

My Lords, I am sure the whole House welcomes the liberation of Raqqa, but deeply regrets both the physical and human cost of Daesh’s control of that area. Is the Minister in a position to say more about the breakdown and balance of the anti-Daesh forces now in control of Raqqa and that area, and anything about the co-ordination and co-operation between them for the future?

[Lord Ahmad of Wimbledon]

The noble Lord raises an important point. We have been supporting the coalition forces and the SDF. I acknowledge that the Russians have also been engaged directly in support of the regime forces. We are clear that the Assad regime initiated this conflict. Although a lasting resolution is very much a matter for the Syrian people, we do not believe it is right that the person who initiated this conflict should be involved in the final, lasting solution. Various international players are working on the ground. I reassure the noble Lord on our actions. The United Nations resolution specifically on Daesh was passed with unanimity, including support from Russia.

Brexit: UK International Relations

Lord Reid of Cardowan Excerpts

Thursday 26th January 2017 Lords Chamber

[Lord Reid of Cardowan (Lab)]

My Lords, like everyone else, I hope for a speedy recovery for the noble Lord, Lord Howell, and congratulate the noble Lord, Lord Jopling, on standing in at such short notice in such fine fashion.

It is a truism to say that we are living in times of great change domestically, on our continent and globally. In the limited time available I want to keep my remarks focused on one or two aspects of that change which offer a huge challenge to the traditional manner and means of conducting our international relations. This applies both to single states and to institutions that are based on states, such as the United Nations.

To begin with, the sheer range of political entities with which we must, or should, engage in the course of conducting international relations has expanded enormously. For centuries, international relations have been conducted through, between, among, or at the level of nation states. That has more or less held true since 1648 and the Treaty of Westphalia. In recent decades, however, powerful political, social and technological change has changed that reality.

First, the emergence of powerful political entities at the level beneath the nation state—regional government, devolved power, national entities inside nation states, including our own, and decentralised political structures—must inevitably add to the complexity of international relations. Of course, that is not an unfamiliar phenomenon in Europe itself, as we will no doubt discover in time when trying to develop free trade agreements with the EU, which will be dependent on the assent of numerous substate actors. It therefore should not surprise us that it is a trend that is strongly emerging in other parts of the world—in the Middle East, for instance, where existing national state boundaries were not so much organically grown from local conditions but, rather, are lines drawn on the map by former colonial powers, sometimes without due regard to ethnic, tribal or other historical factors.

Many of those substate actors now play a powerful role, especially within states undergoing rapid change, conflict or social turmoil. Many have no formal constitutional basis. They range from local power blocs to ethnic groups or NGOs. The question of how and to what extent we can develop the capacity for formal and complex arrangements in addition to our traditional means of international relations becomes a very important aspect. The Foreign Secretary acknowledged these changes in his speech at Chatham House on 2 December. When addressing the challenges, his answer was that,

“we need to redouble our resolve and to defend and preserve the best of the rules-based international order”.

I am always for redoubling our resolve. I was continually doing it as Secretary of State for Northern Ireland; every time something went wrong, we redoubled and rededicated ourselves. However, a Canute-like defence of the past order hardly explains how we are to tackle the new one. Perhaps the Minister could respond to that later.

Secondly, in addition, technological change has undermined the hitherto unchallenged nature and sovereignty of the nation state. Cyberspace is not just an amalgam of technologies or a means of communication; it is truly the first man- and woman-made environment. It permeates and helps to shape new relations in economic, political and social spheres. Above all, it is transnational. Of course we have had reason to notice the domestic effects of cyber and social media, not least in the Arab spring, but we sometimes forget that it has also changed the nature of global transnational relations. Moreover, cyberwarfare and transnational industrial espionage, with all the difficulties of verification and attribution, present a new and unprecedented challenge to traditional state-based diplomatic solutions.

Thirdly, we have what is commonly called globalisation. Transnational commercial organisations now have an unprecedented mobility to transfer assets or taxable income from one state to another. Mass media and social media stimulate economic migration, lawful and unlawful, from poorer to richer states, while terrorists can communicate on a global scale. None of these renders state-to-state relations redundant, but they all challenge the traditional manner in which those relations are conducted.

Separately from that, I have a final point that bears on our relations with the United States. I do not intend to expound upon the special relationship; the Prime Minister is in Washington today, presumably making a lot of that. However, as someone who has worked closely with our American allies over the years, I believe we should not blind ourselves to the potential conflicting objectives that seem to be emerging from the new President. I do not need to mention them all but I shall mention three: a strongly protectionist trade policy, the legitimisation of the use of torture and the unravelling of the Iran nuclear deal. It is the nature of good allies that we tell our friends when we think they are making a terrible mistake, and I hope the Prime Minister will be doing so in that spirit. As they stand apparently in complete contradiction to the aims and objectives of Her Majesty’s Government, and it is difficult to see how they can be reconciled, I would be grateful if the Minister could respond when she draws her conclusions at the end of the debate.

European Union Referendum Bill

Lord Reid of Cardowan Excerpts

Monday 23rd November 2015 Lords Chamber

[Lord Willoughby de Broke (UKIP)]

My Lords, like my noble friend Lord Pearson I welcome this group of amendments—perhaps, rather surprisingly—because it gives us the chance to get some facts out in this report. I hope that the noble Baroness will listen to the other side of the argument. Having listened to what the noble Lord, Lord Grocott, said, I will try to confine myself to facts. Amendment 24C states:

“The report shall cover the possible consequences of withdrawal … upon … the United Kingdom’s economy”.

I think that on the whole that could be rather beneficial. We could get £20 billion back that otherwise we would send to the European Union. That £20 billion may not seem an awful lot of money to some noble Lords who tabled the amendment, but it is a substantial sum of money and would be Britain’s to spend as it sees fit. That is a fact. According to the Pink Book published at the end of October this year, £20 billion was our contribution in 2014.

When we talk about the economy, I know that behind this is the idea that if we were to leave the European Union our industry, the City and other sectors of our productive economy would be acted against and discriminated against by our erstwhile partners. I find that very unlikely. Again, according to the recent Pink Book, we have an annual trade imbalance with the EU of £107 billion. That is a Pink Book fact. What is also a fact is that Britain is the eurozone’s biggest single trading partner—bigger than the United States. We are Germany’s biggest single export market—bigger than the United States. I therefore find it really hard to believe that our trading partners, who have such a promising trade balance with us as their best market, would possibly want to destroy the interests of their best customer.

Going on down the list, I think that the noble Lord, Lord Grocott, has already dealt with the rights of the individual. That of course is entirely up to the United Kingdom Parliament to decide, and no longer a matter for the European Union.

We move on down to law enforcement—new subsection (e) on law enforcement, security and justice. Again, I do not know whether the European arrest warrant is actually the best way to deal with matters. Obviously, we need some way of getting criminals back to face justice, but a prima facie case should be made in front of a magistrate in England before people are sent back to face systems of justice that are very different from ours—so I do not agree with the noble Lord, Lord Hannay, on that.

As for security, of course, were we to leave the European Union we would have control of our borders again. That is arguably the most important thing of all when it comes to security at the moment. We see the chaos in Europe, with barbed-wire fences being erected and France putting up border controls. All over Europe now, people are debating whether free movement of people in and out of the EU is actually possible.

[Lord Reid of Cardowan (Lab)]

Could the noble Lord elaborate on control of our borders? In what sense do we not have control of them?

[Lord Willoughby de Broke]

We no longer have control of our borders because we are subject to the EU directive on free movement of people. That is why we do not have control of our borders, and it is what we need to get back if we are going to give to our citizens—subjects of the Queen—security. Surely giving their citizens security and safety is an overriding priority of any Government now. That trumps any EU ideology, given what is happening right now in front of our faces in Europe. I really think that that is incontrovertible.

[Lord Reid of Cardowan]

The security of our borders, even with the free movement of people, subjects anyone coming here to the same level of scrutiny that would be available were they coming from anywhere else in the world. So while it is true that there is free movement of people, it is not true that the security of our borders is impeded.

[Lord Willoughby de Broke]

I do not agree with the noble Lord at all. Unless we have control of our own borders—our own Border Force properly controlling our borders, not subject to the EU free movement of people directive—we do not have control of our borders. I am very sorry that he does not agree with that, but it is a simple fact.

I shall move on, if I may, to the regions of the UK that receive structural funds. I draw noble Lords’ attention to the fact that we have £20 billion at our disposal. It is entirely possible that structural funds, infrastructure applications, can be judged on their merit by the British Government of the day and allocated accordingly. It is very simple. Our money should not be sent to Brussels with a label on it saying how we are going to spend it. It should be a matter for the British Government and the British people how that is done and not a matter for Brussels at all.

Iran Nuclear Talks

Lord Reid of Cardowan Excerpts

Tuesday 25th November 2014 Lords Chamber

[Baroness Anelay of St Johns]

My Lords, perhaps I may address that matter first. My noble friend is absolutely right to point out that humanitarian relief was never part of the sanctions regime. We have made it clear that we do not wish the sanctions to impact directly on the needs of Iranian people; they should be directed firmly at the Iranian Government. I appreciate that banks can make commercial decisions, but with regard to humanitarian relief efforts it is clear that there should not be any let or hindrance in their delivery. I have had discussions with humanitarian organisations which are firm in their belief on how to take their work forward effectively.

My noble friend also raised the issue of Russia and what it may have agreed to do. I appreciate that there was a story in the New York Times and elsewhere that Russia had agreed to take on responsibility for Iran’s stockpile of uranium and that that might have been a bit of a signal of a breakthrough in the talks. What I can say is that identifying areas for civil nuclear co-operation will be an important part of the final deal, but clearly it would not be appropriate for me to comment on the detail, let alone because it is something that Russia may or may not be involved in. I will say that a deal can be reached only if Iran addresses international proliferation concerns by simply—perhaps it is not so simple—reducing the size of its nuclear programme. That is the core of our negotiations.

[Lord Reid of Cardowan (Lab)]

My Lords, I thank the noble Baroness for a very well balanced Statement, which balances a degree of realism and circumspection with the political will to resolve this issue. That is something that the whole House will want. We were right to engage and we are right to endure as long as there is a prospect of achieving success. The reward, quite frankly, is staggering in its implications. Perhaps I may make a couple of points. First, in congratulating the noble Baroness, Lady Ashton, we are of course congratulating the European Union in an era when that is perhaps not fashionable in all quarters. While we all have our criticisms of the EU, I think that we should put that on the record. Secondly, this is important precisely because, as the noble Lord, Lord Hannay, said, there are more sceptical political voices on the other side of the Atlantic, so the British and European bearing could encourage a more positive approach among the politicians, if not among those who are engaged in this, although I do not doubt for a moment their bona fides. Finally, the last paragraph of the noble Baroness’s contribution is hugely important in its implications. Are we making it absolutely plain in everything that we do that, while achieving a resolution of the nuclear question as an end in itself is of course important, what is even more important in some ways is an entry through that gateway into the potential normalisation of Iran’s place and position in the world? Iran is a great and important nation with a proud history and it has a huge influence over large areas of the world which are at present unstable. If we can use these negotiations as a gateway through to normalising Iran’s role in the world, that would indeed be a prize worth winning.

[Baroness Anelay of St Johns]

My Lords, I agree entirely with the noble Lord, Lord Reid, and the emphasis that he places on the prize that is to be gained by having Iran return to normalisation in its relationships. The very fact of Iran being received back into the family of nations is also the prize to be seized by the rest of the world, not only in the region but elsewhere. Of course I also recognise what the noble Lord says about the noble Baroness, Lady Ashton, who has performed a great role within the EU and on the international stage. Perhaps I may take the opportunity, in answering his question, to say that in my enthusiasm when referring to the appearance on television of Mr Netanyahu last night, I suddenly signed Israel up as a signatory to the Non-Proliferation Treaty. That would certainly have surprised Israel, as it should have surprised me. Israel is not a signatory to the treaty.

Queen’s Speech

Lord Reid of Cardowan Excerpts

Wednesday 11th June 2014 Lords Chamber

[Lord Reid of Cardowan (Lab)]

My Lords, we are now in the final stages of the referendum campaign in Scotland. For the most part it has been a robust and civilised debate. However, there has been one stain on our debates. They have been marred by a campaign of personal abuse and insults carried out on social media, particularly by so-called cybernats associated with the Scottish National Party, against anyone who disagrees with them. I regret that very much. Last weekend I called on Mr Salmond to condemn and clearly dissociate himself from some of those accusations. It was an invitation to which he did not respond.

Perhaps we now know why: it was revealed this morning that Mr Salmond’s most senior adviser had been directly and centrally involved, in the past 24 hours, in a personal attack on a mother of a disabled child who was selected and appointed Carer of the Year in Scotland. That personal smear campaign was carried out because he does not like her views on the referendum. This morning, Mr Salmond ordered his adviser to apologise. That is not enough. If he truly abhors the nature of the vile campaign that has persisted over the past period on social media, he needs to go much further: that adviser should be sacked forthwith. Even then, the suspicion will now remain that the online campaign of personal abuse is not a spontaneous uprising of aggrieved supporters of separation. Rather, it is a centrally directed and orchestrated campaign that demeans the yes campaign and discredits the debate that is taking place in Scotland.

However, we are now finally weighing up the advantages and disadvantages of either course of action: the advantages of membership of the United Kingdom and the disadvantages of separation. I would have thought the advantages were pretty clear. We do not need to look in the crystal ball; we can read the book. Such is the denial of those advantages that it constantly reminds me of that famous “Monty Python” sketch, “What did the Romans ever do for us?”. What did the United Kingdom ever do for us in Scotland? It has given financial stability, from the disaster of the Darien scheme at the end of the 17th century to the disaster of the Royal Bank of Scotland at the beginning of the 21st century, with toxic debt greater than the GDP of Scotland.

The response to that is, “I’ll give you that, but what else did the United Kingdom ever do for us?”. It gave us economic strength. As the First Minister of Scotland keeps reminding us, we are among the wealthiest nations in the world after 300 years in the United Kingdom. England is to blame for that, is it? We have apparently prospered even better than England per capita, which is a peculiar way for England to exploit the Scots. Nevertheless, we have that economic strength. “Well, yes, I’ll give you that, but what else?” The United Kingdom has given us social justice, which the nationalists keep talking about. It has given us comprehensive education, the welfare state, national insurance, pensions, the minimum wage and the National Health Service. These were not gifts of nationalism but gifts of mainly Labour Governments, although also of Liberal and other Governments in Britain. “Well, yes, I’ll give you that, but what else?” The United Kingdom has given us individual opportunity, with scientists, administrators, leaders, sports men and women, and business men and women travelling the world. So we go on, but with a constant sense of denial from the First Minister.

However, if his denial of the advantages is great, his denial of the risks is even greater: the risks to do with currency, pensions, EU membership, taxation, immigration and defence and security. To deny that, he has to dismiss, disagree with or, in some cases, denigrate one or two people, such as the President of the United States, the President of the EU, the Scandinavian Foreign Ministers and the former Prime Minister of Sweden, Carl Bildt. The First Minister yesterday referred to him as a fool; he said he was “foolish”. There are many people in Europe who might disagree with Carl Bildt and might think he is wrong in some things. There are very few people, other than the First Minister, who think Carl Bildt is a fool.

Yet that process of denial continues. To sustain the claims that separation has great advantages and no risks, you have to dismiss one or two experts. The First Minister has told us that experts know very little about what they are speaking about: the Governor of the Bank of England knows nothing about Bank of England matters; the Secretary-General of NATO is not an authority on NATO; the President of the European Commission, of course, knows very little about the European Union; and the Institute for Fiscal Studies is dreadfully ignorant of fiscal studies. What does Standard & Poor’s, the leading ratings agency, know about ratings? And so it goes on. I have great respect for those who say, “Yes, there are risks but I want to be separate on principle and I will bear the risk”. However, I have no respect for those who say, “This is all reward and no risks”, because that is a massive act of self-denial and a massive act of deception towards the people of Scotland.

Therefore, as we approach the weighing up of the arguments on 18 September, I sincerely hope that, having examined the options, the people of Scotland will give a polite but firm “no thanks” to the nationalists. I think that that will happen and I think, and hope, that it will be a decisive answer, and then we can, as the noble Lord, Lord Hennessy, said, get on with improving and changing our country for the better, without changing our passports.

Syria

Lord Reid of Cardowan Excerpts

Tuesday 8th October 2013 Lords Chamber

[Baroness Warsi]

The noble Lord is right that the make-up of the opposition is incredibly complex. We have been working with the national coalition, which has now been recognised as the voice for the opposition by a large number of member states—most of our allies, including most of the Arab world and the Arab League. Therefore, it is the national coalition that we are working with and which we expect will represent the opposition at the Geneva II process.

[Lord Reid of Cardowan (Lab)]

My Lords, in view of the developments since this House and the House of Commons last met, would the Minister reflect that perhaps the House of Commons and many in the House of Lords displayed a degree of wisdom that may have been greater than the Government thought at that time? In view of that, will the Minister assure us that there will be no preconditions from the British Government to any talks about a future settlement, particularly when we bear in mind that, however awful the devil we know in Syria, there are a number of devils around that may ultimately be even worse, both locally and of a strategic nature?

[Baroness Warsi]

The noble Lord raises an important point but I need to be clear on this issue. There are two parts to what has been discussed over recent months, on the political track. The Government have always been clear that the matter will be resolved politically, but the specific incident relating to chemical weapons and on which the will of Parliament was listened to was a separate situation. Noble Lords would accept and agree that the Assad regime’s now voluntary destruction of deadly weapons in the form of chemical weapons is an important step that has vindicated the threat of military action by the United States. We would not be in this position if the Assad regime did not anticipate that some military action would be taken.

Regulation of Investigatory Powers Act 2000: External Communications

Lord Reid of Cardowan Excerpts

Tuesday 30th July 2013 Lords Chamber

[Lord Reid of Cardowan]

My Lords, I think the House recognises that electronic communications have grown exponentially and are now global and transnational, not merely international. In order to have some perspective and context to this Question, can the Minister give us a rough indication of how many terrorist plots have been foiled and how many British lives have been saved through the legal supervision of those electronic communications?

[Baroness Warsi]

The noble Lord makes an important point which is, of course, based on his many years of experience in dealing with this very real threat. I cannot give precise numbers here at the Dispatch Box. However, I can say that secret intelligence work is vital to our country. It detects threats that our country is facing, ranging from nuclear proliferation to cyberattacks, it prevents serious and organised crime, it prevents and disrupts complex terrorist plots and it supports the work of our Armed Forces. These are all things that protect our country and its citizens.

European Union (Approval of Treaty Amendment Decision) Bill [HL]

Lord Reid of Cardowan Excerpts

Wednesday 23rd May 2012 Lords Chamber

[Lord Reid of Cardowan]

My Lords, I wish to make three simple observations in the gap. The first is that the recession and the problems of the eurozone may be related but they are actually distinct. The recession is a global challenge; the eurozone is a home-grown European problem because it is based on the wretchedly misconceived delusion that you can bring together 17 or more nations of varying productivity and competitiveness and so on and merge them by an act of sheer political will into an economic reality other than the one that exists. It is probably the biggest political misjudgment since Versailles and may lead to the same form of consequences. Incidentally, on that subject, not all red lines were abandoned by the previous Government, as has been suggested. One that was maintained was the demand for convergence before joining the euro, and it was maintained in bright red because it was a demand that could never be met in our lifetime, which is precisely why it was there.

The second point arising from that is that the problem is therefore chronic and not acute. It runs right through the eurozone itself. It is a fundamental problem and my great fear is that the cure will be worse than the disease. The noble Lord, Lord Dobbs, spoke of the treaty of Versailles and the economic consequences in Germany. However, it was not the economic consequences alone that led to the extreme social and political instability but the perception that they were being imposed from outside. Therefore, if the cure for the eurozone is further centralisation in Brussels, which is at the centre and is seen to be a frontage for Germany, it will not cure the problem. It was predictable and predicted that social and political instability would be added to financial instability, and that is precisely what is happening in Greece.

Thirdly and finally, it is not anti-European to point these things out. It is not anti-European to argue against the eurozone. It is not an act of friendship to encourage your friends to continue on a ruinous path which you believe will result in an even greater catastrophe for them. There is an old military adage, “Never reinforce failure”. If something is fundamentally flawed and failing, it is no act of friendship for us to encourage people to go in that direction. I wish that we had spent just half the money that we have spent trying to bail out the euro with every member inside it on something similar to a Marshall Plan—a really radical plan which recognises the fundamental flaw and then assists our European colleagues who have made the terrible mistake of joining the wretchedly misconceived eurozone to exit from it. So far as I am concerned, that would be a real act of European solidarity.

--- Later in debate ---

[Lord Liddle]

I am sure that that is the Chancellor’s interpretation.

I recognise that there are some distinguished Members of this House who are long-term supporters of British membership of the European Union, but never believed that the euro could be made to work. We had wonderful speeches from the noble Lords, Lord Lamont and Lord Lawson, but I do not agree with what the noble Lord, Lord Lawson, said. He said that monetary union will work only if you have what the Germans call the coronation theory—the customs union first, the political union and then the monetary union to crown it.

I recognise that the euro was set up on a flawed basis. I thought that as the problems occurred they would be addressed incrementally and that reforms would be introduced that would make the system work. The trouble is that we have had a cushy decade of total complacency—it was a cushy decade for the UK as much as it was for the eurozone—in which the impetus for reform was completely lost. Short of federal union, if the eurozone took the kind of steps that Labour is advocating now it would have a viable future.

[Lord Reid of Cardowan]

Would my noble colleague consider that perhaps the problem was not complacency but precisely the assumptions that he has outlined to us: that as problems arose, incrementally we would go towards a central state in Europe and no one would ask the peoples of the nations of Europe? That is precisely the problem because what is being suggested now is one of these huge incremental steps. I promise him that there will be a reaction of nationalism in Europe because it will require not only centralisation but the imposition of austerity from the centre. We will create the very conditions that caused such resentment in Germany in the 1920s and 1930s.

[Lord Liddle]

I have the greatest respect for my noble friend Lord Reid, and in my life I have learnt an awful lot from him. However, his assumption that the only alternative to where we are now is a central state is fallacious. What have been lacking in the past 10 years are the incremental reforms of the kind that I have outlined that would have made the euro work.

I have gone on too long. I believe the consequences of a euro break-up, which some noble Lords seem to want to will on, would be horrendous. Eurosceptics make a fundamental mistake in thinking that for a country such as Greece, exit from the euro would solve its problems. A lot of British people think that it would be a classic devaluation, rather like our exit from the ERM in 1992. It would be nothing like that. Ordinary people’s savings would be wiped out as the Greek banks collapsed. There would be severe additional spending cuts, because with all borrowing cut off the Government would be unable to finance the deficit. They would have to cut welfare benefits and public pay. The new currency would plummet in value because there would be no private inflows of capital to sustain the balance of payments. It would be an economic disaster zone.

There would be huge social tensions between the better-off, who had already got their money out of the country, and the wage earners, the poor and the unemployed, who would have to live on the devalued drachma. We would see—here I agree with my noble friend Lord Anderson—the emergence of a failed state on Europe’s south-eastern flank, with incalculable consequences for relationships with Cyprus, Turkey and the rest of the Balkans. As my noble friend Lord Reid knows well, this is a part of the world on which we have spent blood and treasure over the past two decades to try to stabilise. Kick the Greeks out of the euro, and what are we going to do about stability in the Balkans? It is just too awful to contemplate. That is why the euro must, and can, be saved—if we adopt the right policies to do so.

The noble Lord, Lord Dobbs, spoke eloquently about his lessons of history. My lesson would be that a Greek exit would be followed by competitive devaluation, protectionism, a run on other countries, terrible contagion problems and an outbreak of nationalism. Conceivably, it could return Europe to the inter-war years, so I want Britain to play a constructive, committed and engaged role in trying to make this thing work, not a carping, hectoring and lecturing one. We need a rescue, we need the ESM, and that is why we need this Bill.