Ukraine

Lord Balfe Excerpts

Tuesday 18th March 2014 Lords Chamber

[Lord Balfe (Con)]

My Lords, I begin by recording my interest as a three-time election observer in Ukraine, as well as visiting on a number of occasions and heading up a programme run by the European Parliament Former Members Association called EP to Campus, which sends former Members to universities. We have sent quite a few to universities in Ukraine, particularly in Kiev and Donetsk.

The noble Lord, Lord Anderson, is not in his place. I reflected at one point that sometimes pleasant consequences come out of tragic situations. If the Conservative group ended up in the EPP, I would regard that as being an extremely good solution to us not having anywhere to go at the moment, but we will see about that in due course.

As I mentioned, I have visited Ukraine, including Crimea, on many occasions. It has always been very clear to me that there have always been huge tensions within the different communities in Ukraine and Crimea. Seven or eight years ago in Crimea, when I spoke to Crimean parliamentarians in the autonomous parliament, a number of them, even at that time, expressed great regret that they were in Ukraine at all. The idea of joining Russia has not come up in the past few months; it has simmered away ever since, as one parliamentarian put it to me, the unexpected and somewhat cavalier act of Nikita Khrushchev in removing Crimea from Russia.

What we have to look at going forward, without in any way accepting last Sunday’s referendum as being fair, rational or giving proper opportunities for debate, is a way for the people of Ukraine to express a preference for where they want to be. We must also realise that we have our press in this country but my son, who is living in Moscow at the moment, describes it as Russia trying to stir up tensions in order to create a pretext for further involvement in eastern Ukraine, with the Russian media operating as an anti-western, anti-Ukraine propaganda machine. In other words, they are building up the fires. But there has also been some building up of fires in Washington and in places somewhat closer to home.

The referendum was certainly not conducted in a satisfactory way, but I do not think it becomes a Parliament that is about to give an independence vote to Scotland to say that we cannot devise a formula whereby the people of Ukraine can express their preference for where they would wish their Government ultimately to be based. As the noble Lord, Lord Howell, said, there are many possible solutions on offer. Our job is to look forward and to try to be a facilitator of those negotiations, not to be partisan but more to follow the line of recent statements by the former German Chancellor, Gerhard Schroeder. He said that the EU has to take some responsibility for the current situation in Ukraine because we have rather polarised it. It is either an association agreement or a customs agreement with Russia. We have to come to a solution which is somewhere in between those two. Moving forward has to be done in a both-ways scenario, as our colleague Mr Schroeder says.

I counsel us to be cautious in the way that we deal with all our relations with Russia. To the people of Russia, what happened in the 1990s was not exactly the triumph that we see here. Many people in Russia do not look on either Mr Gorbachev or Mr Yeltsin as great figures; many of them look on those two people as being less-than-perfect defenders of what they regarded as their pride and their interests. We need to keep that in mind at all times when dealing with Russia.

We also need to look at money-laundering, which was mentioned by the noble Earl, Lord Sandwich. We cannot be unaware of the huge amount of eastern European money that is in London. When I think of my late mother-in-law in her late 80s trudging down to the bank with her passport to show that she was not money-laundering and I then look at the huge amount of money coming into this country, into flats and property, and basically depriving Londoners of the ability to have somewhere to live, I wonder whether we are concentrating on the wrong end of that particular spectrum. In some people’s view—and it would not be far from mine—we have also aided the plundering of the wealth of eastern Europe, which has come in here, has done marvels for our balance of payments but has impoverished a lot of people in eastern Europe.

One final problem that I want to deal with is that of corruption in Ukraine. As the noble Lord, Lord Kerr, mentioned, it has existed under the past five Governments, and it is sad and endemic. I have a number of people whom I would count as friends in Ukraine. Most of them are in what we could call the middle classes: they are doctors and professionals, many of them working in the public sector. The Ukraine Government know that their public servants cannot live on the wages they are paid. A Russian word which is widely used in Ukraine—I hope the noble Baroness, Lady Suttie, will forgive me, because my pronunciation is probably awful—is blagodarnost, which means a payment in gratitude; in other words, a bribe. One of my friends who is a doctor would say that she could not live on the salary paid to her by the state. She operates a public clinic for one and a half days a week, and for the other three and a half days, with the open connivance of the Ukrainian state under a variety of Governments, she accepts under-the-counter payments for priority. She runs a sort of Nuffield health service in the Ukrainian medical service. This is not unique; it is a problem which the Ukrainian authorities have got to overcome, because until they do so there will not be investment. While a judge can be bribed to deliver a corrupt decision that will take all your investment away—and there are plenty of examples of people’s investments being corruptly confiscated by court decisions—and until you can get a rule of law that guarantees the sanctity of investment, people will not invest. This is a major problem that Ukraine has to tackle, and it is a problem that goes right back to the Kuchma Government. We can say that the President just out of office, Yanukovych, was corrupt, but he was only following a long pattern. After all, Mrs Tymoshenko was known locally as the “gas queen”. This problem has to be tackled.

That is why we must have a certain amount of humility. One of the things about this debate has been the number of times that the European Union has been mentioned. If anyone believes there would be any future for Britain outside the European Union in influencing Europe, let them read through this debate. I do not think that a single noble Lord even intimated that we would have the same amount of influence outside the European Union. Let us join with our EU partners in trying to mediate between the legitimate interests of a lot of disparate players. We have a role to play as part of a wider European polity. I hope the noble Lord who replies to the debate will be able to assure us that we will fulfil that role.