Intelligence and Security Services: Treatment of Detainees

Lord Strathclyde Excerpts

Tuesday 6th July 2010 Lords Chamber

[The Chancellor of the Duchy of Lancaster (Lord Strathclyde)]

My Lords, I think that now is a convenient moment to take the Statement made by the Prime Minister in another place a few minutes ago on the treatment of detainees. The Statement is as follows:

“Mr Speaker, I am sure that the whole House will wish to join me in paying tribute to the Royal Marine who died on Thursday, the soldier from the Royal Dragoon Guards who died yesterday and the soldier from 1st Battalion the Mercian Regiment who died from wounds sustained in Afghanistan at hospital in Birmingham yesterday. We should constantly remember the services and sacrifices made on our behalf by our Armed Forces and their families.

With permission, I would like to make a Statement on our intelligence services and allegations made about the treatment of detainees. For the past few years, the reputation of our security services has been overshadowed by allegations about their involvement in the treatment of detainees held by other countries. Some of these detainees allege they were mistreated by those countries. Other allegations have also been made about the UK's involvement in the rendition of detainees in the aftermath of 9/11. These allegations are not proven.

But today, we do face a totally unsatisfactory situation. Our services are paralysed by paperwork as they try to defend themselves in lengthy court cases with uncertain rules. Our reputation as a country that believes in human rights, justice, fairness and the rule of law—indeed, for much of what the services exist to protect—risks being tarnished. Public confidence is being eroded, with people doubting the ability of our services to protect us and questioning the rules under which they operate, and terrorists and extremists are able to exploit these allegations for their own propaganda.

Myself, the Deputy Prime Minister, the coalition Government—we all believe it is time to clear this matter up once and for all. So today I want to set out how we will deal with the problems of the past, how we will sort out the future and, crucially, how we can make sure the security services can get on, do their job and keep us safe.

But, first, let us be clear about the work they do. I believe we have the finest intelligence services in the world. In the past, it was the intelligence services that cracked the secrets of Enigma and helped deliver victory in World War II. They recruited Russian spies like Gordievsky and Mitrokin and kept Britain safe in the Cold War. And they helped disrupt the Provisional IRA in the 1980s and 1990s. Today, these tremendous acts of bravery continue. Every day intelligence officers track terrorist threats and disrupt plots. They prevent the world's most dangerous weapons falling into the hands of the world's most dangerous states. And they give our forces in Afghanistan the information they need to take key decisions.

They do this without any public—or often even private—recognition, and despite the massive personal risks to their safety. We should never forget that some officers have died for this country. Their names are not known. Their loved ones must mourn in secret. The service they have given to our country is not publicly recognised. We owe them—and every intelligence officer in our country—an enormous debt of gratitude. And, as Minister for the Intelligence Services, I am determined to do everything possible to help them get on with the job they are trained to do—and we desperately need them to do.

However, to do that, we need to resolve the issues of the past. While there is no evidence that any British officer was directly engaged in torture in the aftermath of 9/11, there are questions over the degree to which British officers were working with foreign security services that were treating detainees in ways they should not have done. About a dozen cases have been brought in court about the actions of UK personnel, including, for example, that since 9/11 they may have witnessed mistreatment such as the use of hoods and shackles.

This has led to accusations that Britain may have been complicit in the mistreatment of detainees. The longer these questions remain unanswered, the bigger the stain on our reputation as a country that believes in freedom, fairness and human rights grows. That is why myself and the Deputy Prime Minister are determined to get to the bottom of what happened. The intelligence services also are keen publicly to establish their principles and integrity.

So we will have a single, authoritative examination of all these issues. We cannot start that inquiry while criminal investigations are ongoing. And it is not feasible to start it when there are so many civil law suits that remain unresolved. So we want to do everything we can to help that process along. That is why we are committed to mediation with those who have brought civil claims about their detention in Guantanamo. And wherever appropriate, we will offer compensation.

As soon as we have made enough progress, an independent inquiry, led by a judge, will be held. It will look at whether Britain was implicated in improper treatment of detainees held by other countries that may have occurred in the aftermath of 9/11. The inquiry will need to look at our security departments and intelligence services. Should we have realised sooner that what foreign agencies were doing may have been unacceptable and that we should not be associated with it? Did we allow our own high standards to slip, either systemically or individually? Did we give clear enough guidance to officers in the field? Was information flowing quickly enough from officers on the ground to the intelligence services and then on to Ministers, so that we knew what was going on and what our response should be?

We should not be naive or starry-eyed about the circumstances that our security services were working under in the immediate aftermath of 9/11. There was a real danger that terrorists could get their hands on a dirty bomb, chemical and biological weapons or even worse. Threat levels had been transformed. The urgency with which we needed to protect our citizens was pressing. But let me state clearly: we need to know the answers. If things went wrong, why? What must we do to uphold the standards that people expect?

I have asked the right honourable Sir Peter Gibson, former senior Court of Appeal judge and currently the statutory commissioner for the intelligence services, to lead the inquiry. The three-member inquiry team will also include Dame Janet Paraskeva, head of the Civil Service Commissioners, and Peter Riddell, former journalist and senior fellow at the Institute for Government. I have today made public a letter to the inquiry setting out what it will cover, so that Sir Peter Gibson can finalise the details with us before it starts. We hope that the inquiry will start before the end of this year and will report within a year.

The inquiry cannot and will not be costly or open-ended—that serves neither the interest of justice nor national security. Nor can it be a full public inquiry. Of course, some of its hearings will be in public. However, we must be realistic. Inquiries into our intelligence services are not like other inquiries. There is some information that must be kept secret—information about sources, capabilities and partnerships. Let us be frank: it is not possible to have a full public inquiry into something that is meant to be secret. Any intelligence material provided to the inquiry panel will not be made public, nor will intelligence officers be asked to give evidence in public.

But that does not mean we cannot get to the bottom of what happened. The inquiry will be able to look at all the information relevant to its work, including secret information. It will have access to all relevant government papers, including those held by the intelligence services, and it will be able to take evidence in public, including from those who have brought accusations against the Government and their representatives, and interest groups. Importantly, the head of the Civil Service and the intelligence services will ensure that the inquiry gets the full co-operation that it needs from departments and agencies. I am confident that the inquiry will reach an authoritative view on the actions of the state and our services and make proper recommendations for the future.

Just as we are determined to resolve the problems of the past so we are determined to have greater clarity about what is acceptable and what is not in the future. That is why we are publishing today the guidance issued to intelligence and military personnel on how to deal with detainees held by other countries. The previous Government had promised to do this, but they did not; we are. The guidance makes it clear, first, that our services must never take any action where they know or believe that torture will occur; secondly, if they become aware of abuses by other countries, that they should report it to the UK Government so we can try to stop it; and, thirdly, in cases where our services believe that there may be information crucial to saving lives but where there may also be a serious risk of mistreatment, that it is for Ministers, rightly, to determine what action, if any, our services should take. My right honourable colleagues the Foreign, Home and Defence Secretaries have today laid in the House further information about their role in these difficult cases.

There is something else we have to address, and that is how court cases deal with intelligence information. Today, there are serious problems. The services cannot disclose anything that is secret in order to defend themselves in court with confidence that it will be protected. There are also doubts about our ability to protect the secrets of their allies and stop them from ending up in the public domain. This has strained some of our oldest and most important security partnerships in the world—in particular that with America. Honourable Members should not underestimate the vast two-way benefit that this US-UK relationship has brought in disrupting terrorist plots and saving lives, so we need to deal with these problems.

We hope that the Supreme Court will provide further clarity on the underlying law within the next few months, and next year we will publish a Green Paper which will set out our initial proposals for how intelligence is treated in the full range of judicial proceedings, including addressing the concerns of our allies.

In this process the Government will seek the views of the cross-party Intelligence and Security Committee, and I can announce that I have appointed the right honourable Member for Kensington, Sir Malcolm Rifkind, as the chair of that committee for the duration of this Parliament.

As we meet in the relative safety of this House today, let us not forget this. As I speak, al-Qaeda operatives in Yemen are meeting in secret to plot attacks against us, terrorists are preparing to attack coalition forces in Afghanistan, the Real IRA is planning its next strike against security forces in Northern Ireland, and rogue regimes are still trying to acquire nuclear weapons.

At the same time, men and women, young and old, all of them loyal and dedicated, are getting ready to work again around the world. They will be meeting sources, translating documents, listening in on conversations, replaying CCTV footage, installing cameras, following terrorists; all to keep us safe from these threats. We cannot have their work impeded by these allegations. We need to restore Britain's moral leadership in the world. That is why we are determined to clear things up, and I commend this Statement to the House”.

That concludes the Statement.

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[Lord Strathclyde]

My Lords, I thank the noble Baroness for her reply to the Statement and her broad support for the direction of travel that we are taking. She asked a question that will be of interest to many Members of the House on our view on Guantanamo Bay and its closure. The noble Baroness knows well that the UK has long held that the indefinite detention of detainees is unacceptable and that the Guantanamo Bay detention facility should be closed. The Government of whom she was a member welcomed President Obama’s executive order to close Guantanamo Bay and worked closely with the United States to ensure that potential security and human rights concerns posed by the release of the detainees were appropriately addressed, but—this is not a weaselly “but”, but a “but” that is a matter of fact—the timetable for closure is naturally a matter for the United States Government.

The noble Baroness asked about the criminal inquiries set up by the noble and learned Baroness, Lady Scotland. My understanding is that they will continue. The mediation that we have announced today is primarily to deal with the civil cases that are before the courts and to try to deal with them as quickly and rationally as possible. Apart from anything else, that is why the Human Rights Act is extremely important. The noble Baroness will know our long-term views about the Act and the potential review and commission on a Bill of Rights. The package announced on detainees will clearly be of interest to the United Nations torture committee and we will want to cover it in our fifth periodic report. We will provide that report as soon as is practicable.

Today we are setting out how we will settle the issues of the past and make clear our rules for the future and the operation of the security services, thereby building a framework for justice that enhances our security and our liberty. I am not sure whether the noble Baroness asked specifically about the role of the inquiry and whether it would work together with the mediation. We take the view that it is simply not possible to begin the inquiry while some of the allegations are still the subject of criminal investigations. The Government take the view that it is not feasible to begin the inquiry while the civil proceedings are not sufficiently resolved.

The Statement makes a number of proposals on the inquiry, new guidance for intelligence and military personnel, a proposed Green Paper, which we hope to publish next year, and the start of mediation. It is a major Statement about trying to get to grips with what has happened in the past, but it provides for a clear framework on how we can deal with the intelligence and security services in the future.

[Lord Falconer of Thoroton]

My Lords, I broadly endorse the Statement and congratulate the Government on making it. I thought, with respect, that the reasons given for condemning Guantanamo Bay were slightly understated. It is not the indefinite detention that is bad; it is the fact that there was detention without any access to law and without a legal basis that was so objectionable. I congratulate the Government on setting up the judicial inquiry. I would call it a judicial rather than an administrative inquiry in the sense that a judicial inquiry implies that it is independent and separate from the organisation into which it is looking. Sir Peter Gibson, Dame Janet Paraskeva and Peter Riddell are excellent choices, but I have two further questions.

First, I agree with the Government that it is important that the approach that they take in dealing with detainees held by other countries should be clear. The three principles enunciated in the Statement seem to lack clarity. The first is that,

“our services must never take any action where they know or believe that torture will occur”.

Does that mean that a question should not be put to another country that detains somebody when it is feared that that other country may use torture?

My second question relates to the principle applying to the courts on keeping documents secret. The principles that the courts have applied over the years have been broadly effective; they can balance the interests of secrecy against the interests of litigants. What sort of changes are the Government considering in relation to that?

[Lord Strathclyde]

I thank the noble and learned Lord for his general welcome of the Statement. He clarified a view on Guantanamo Bay and I hope that he would not read anything into what I said as being far from the wording that he used, which is entirely appropriate.

On the inquiry being judicial, the noble and learned Lord will have plenty of experience on this and will understand the view that we have taken and the reasons for making the inquiry as it is. I very much welcome his endorsement of the three individuals who will lead the inquiry.

On the issue of clarity, one of the reasons for making this Statement is to try to give greater clarity in future for some of the decisions that are taken. For instance, there are no circumstances where we would authorise action, including receiving intelligence, in the knowledge or belief that torture would take place at the hands of a third party. If such a case were to arise, we would do everything that we could to prevent the torture from occurring. That is consistent with the absolute prohibition on torture and our values as a nation.

The reality is that, in most cases, countries do not disclose the sources of the intelligence that they share with us. However, the guidance leaves our partners in no doubt about the standards to which we adhere and the action that we will take if we suspect that intelligence has derived from the mistreatment of a detainee.

[Lord Lloyd of Berwick]

My Lords, I apologise to the House for missing the first few minutes of the Statement; I was in my room awaiting the announcement. I welcome all aspects of the Statement, particularly the decision to get to the bottom of what may have gone wrong in the past before looking to what ought to be done in the future. I welcome the appointment of Sir Peter Gibson as the chair of the inquiry. You could not have a better man for the job.

Does the Leader of the House agree that there is an almost exact precedent for the inquiry, as now contemplated, in the work that used to be done by the Law Commission, of which I once had the honour to be the chairman? If the procedure that we had in the Law Commission is followed, I hope that the inquiry will not go wrong. Does the noble Lord agree that the scope of the present inquiry will be altogether different from that of the Saville inquiry and that there is no reason at all to believe that this inquiry, like the old Law Commission inquiries, should not be completed within a year?

[Lord Strathclyde]

My Lords, I thank the noble and learned Lord for what he has said. He says it from a most authoritative position, with all his experience in reviewing terrorism legislation in the past. I am insufficiently well versed in these matters to know whether or not the Law Commission presents an exact precedent but, if the noble and learned Lord says that it does, I am happy to accept it. I also agree with him—this is important for those who might make comparisons with the Saville inquiry—that the scope of this inquiry is very different from that laid out by Saville. As we said at the time, we do not wish to see any more open-ended inquiries of that style. Again, I agree with the noble and learned Lord: there is no reason why it should not be able to complete within the next 12 months.

[Lord Howarth of Newport]

My Lords—

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[Lord Dholakia]

My Lords, I join my noble friend the Leader of the House in paying tribute to those who have lost their lives in recent days in Afghanistan. The torture allegation has been a shameful episode for the good name of our country and we welcome this inquiry. I hope that it will be able to look at why this has taken such a long time and that it will question the previous Administration about why the inquiry was not held much earlier. We are aware of the constraints placed on the coalition Government, as a number of outstanding issues need to be resolved, but I have two questions for the Minister. First, does the payment of compensation before the inquiry has reported compromise it in any way? Secondly, the Statement mentions our co-operation on intelligence matters with other countries, particularly the USA. Would it be possible for the inquiry to take evidence from those countries that are involved in the torture allegations?

[Lord Strathclyde]

My Lords, I cannot answer for the previous Administration. The noble Baroness, Lady Royall, has defended the position of the previous Government. However, we have taken action quickly and I know that my noble friend supports that. On compensation, I do not think that the two issues are related at all. We have suggested a process of mediation that could potentially lead to compensation, but that is better than the alternative, which could be years of unsatisfactory litigation in the courts. At least a process of mediation creates the possibility of creating certainty much sooner. With regard to working with other countries, we do not expect evidence to be taken from US officials. It is our intention that the inquiry will have access to material relating to foreign partners. Those partners will be consulted on the terms on which their material will be considered by the inquiry. Any intelligence material will be dealt with in private. We have, of course, discussed our plans with the US and a number of other partners.

[Lord Goldsmith]

Is the Minister aware that I, too, welcome this inquiry? I rather wish that I were welcoming it coming from the previous Administration rather than this one, but it is none the worse for that. The noble Lord is right that it is time to understand the truth or otherwise of these allegations, as I for one have been saying for some time.

I have three specific questions for the noble Lord. First, my noble friend the Leader of the Opposition raised the question of Guantanamo, rightly, because the allegations that have been made are connected with that issue. Is that an issue that the inquiry will look into—the relationship of this country to Guantanamo, the steps that were taken and why it was, as noble Lords all now agree, a wrong-headed thing for the previous US Administration to do, in principle and in practice?

Secondly, will the noble Lord help a little more on the timing of this inquiry? I understand the point about criminal proceedings and civil mediation, but I am still unclear on when this inquiry is going to be allowed to get on with its job. The more time before it starts, I suspect, the more difficult it will be.

Thirdly, the noble Lord finished his Statement by talking about future policy in relation to the use of intelligence in the courts. Is that going to include, finally, a clear answer to the question of the use of intercept evidence in court? I know that many noble Lords take a different view but for myself, from the position that I have held in the past, I believe that it is important to find a way of using such evidence in criminal proceedings. Will that be a part of the policy that will be announced?

[Lord Strathclyde]

Again, my Lords, it is encouraging to receive the noble and learned Lord’s welcome and support for the principles that underlie the Statement. It is important, when we are dealing with these matters of national security, that there is as wide an agreement across the parties as possible. The noble and learned Lord’s experience in this matter will give a lot of encouragement to others who are involved.

His first question was whether the inquiry will look at the reasons behind Guantanamo. I expect that it will be up to the inquiry to take a view about how important that is, and I cannot answer for the inquiry. I do not suppose that the topic will be excluded, but if it is, I shall write to the noble and learned Lord.

Secondly, on the timing of the inquiry, we would like it to start as soon as possible but it cannot begin until most of the legal proceedings have been dealt with, hence the reason for coming forward with mediation. It depends on the satisfactory resolution of the other legal proceedings. I also agree with what the noble and learned Lord said: the longer it is delayed, the more difficult it is to have this inquiry, so it is in everyone’s interest to reach the start date as soon as possible.

As for the noble and learned Lord’s third question, about the future and intercept evidence, I have my noble friend Lady Neville-Jones, our Security Minister, next to me here. The whole issue of intercept evidence still has to be resolved.

[Lord Howarth of Newport]

My Lords—

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[Lord Mackay of Clashfern]

I agree with the Statement, in particular the setting up of a very distinguished inquiry. I entirely agree with the views already expressed by others that these three people are eminently qualified for this task.

I also entirely supported the action of the previous Attorney-General in initiating criminal inquiries in connection with this matter. It must be right that these inquiries are completed before the new inquiry can start. I hope that it will not be unduly delayed. One cannot tell which precise circumstances will arise. However, I think it is clear that the criminal proceedings must take priority and be completed before this inquiry starts. I think I am right in saying that the Statement envisaged the work of the inquiry taking about a year. It will be extremely good if it can be done in that time. I also believe that the three people in question are eminently qualified to do it with reasonable speed. I am very grateful for the Statement. I have no particular question that I want to ask my noble friend, which is why I should not be standing at all.

[Lord Strathclyde]

My Lords, it is always a great pleasure to have my noble and learned friend standing and speaking, particularly on this, where he has very much given his support to what we are doing. I agree with him about the criminal inquiries that are ongoing, that the time for the inquiry is roughly 12 months, and about the people who have been chosen to lead it. I am sure that they, too, will be encouraged by his support.

[Lord Morris of Aberavon]

My Lords, while I welcome the setting up of the inquiry, would the Minister help us a little further on the start line? I can quite see the difficulty of outstanding procedures. As regards civil law, mediation can bring some of those procedures to an end. There are more difficulties with criminal procedures. There is a means of bringing even those to an end; it is a question of balance and whether it is in the public interest so to do. It would be helpful if the Minister could give some idea of when the inquiry is likely to start.

Secondly, I do not know how the Minister can give a firm assurance that this matter is to be completed within a year. I had to set up public inquiries—the first was 45 years ago—the intention being to finish in weeks, but some went on for months. I do not know how the Minister can give the assurance that it will finish within 12 months, as I hope it will.

[Lord Strathclyde]

My Lords, I am glad to hear that the noble and learned Lord shares the aim of delivering as quickly as possible. He is right to ask how we can guarantee that. We cannot, but there is a general will from all sides to complete an inquiry once it has started. When can it start? Like us, the police take the view that it is simply not possible to begin the inquiry while some of the allegations are still the subject of criminal investigations. The Government take the view that it is not feasible to begin the inquiry while the civil proceedings are not sufficiently resolved. We hope that we can deal with the civil proceedings through mediation if that is acceptable to all sides. The police are continuing their criminal investigations. It is in everybody’s interests to start this inquiry but, for the reasons that I have laid out, I cannot give an exact date.

[Lord Wright of Richmond]

My Lords, as a former chairman of the Joint Intelligence Committee—admittedly a very long time ago—I endorse everything that the Minister said about the professionalism, effectiveness and bravery of our security and intelligence services. I have one question. Will the inquiry address or readdress the question of the rendition of detainees through British territory and, in particular, through Diego Garcia?

[Lord Strathclyde]

My Lords, the noble Lord is experienced and knows full well about the bravery and work of our security services. As far as extraordinary rendition is concerned, there is no barrier whatever to the inquiry looking into such issues and the matter of Diego Garcia if that should be pertinent to it.

[Lord Howarth of Newport]

My Lords—

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[The Lord Bishop of Chester]

My Lords, would the noble Lord the Leader of House comment a little more on the terms of reference of the inquiry? Is it an inquiry into the facts of what happened or into the broader reasons why it was permitted to happen?

[Lord Strathclyde]

The inquiry will look at whether the UK was implicated in the improper treatment of detainees held by other countries that may have occurred in the aftermath of 9/11.

[Baroness Hamwee]

My Lords, building on the last question and those of the noble and learned Lord, Lord Goldsmith, and the noble Lord, Lord Wright of Richmond, would the Government consider consulting on the precise terms of reference? We have seen on previous occasions that where matters fall outside the precise terms of reference of an inquiry, it can cause some problems. Secondly, can the Government be clearer about whether the Green Paper which is referred to will be part of the review of security which we know is in train?

[Lord Strathclyde]

My Lords, I do not think that the terms of reference have been finalised at this stage, not least because the inquiry has not been set up. I am sure that what the noble Baroness has said will be taken into account. I have completely forgotten the other matter which the noble Baroness raised.

[Baroness Hamwee]

Is the Green Paper to be part of the review of security?

[Lord Strathclyde]

The Green Paper is a Green Paper. It will be published next year. Because of that, we have not yet decided what will go into it.

[Lord Howarth of Newport]

My Lords, I was a member of the parliamentary Intelligence and Security Committee for four years. My whole disposition is to believe in the good principles and integrity of the agencies, and in their competence as they go about their crucial work which, as the Statement reminded us, often comes at a high price to them and their families. Is it not the case that because of the real danger of terrorist assaults on our people and of weapons of mass destruction getting into the hands of terrorists or irrational regimes, we live in a permanent state of emergency, and that the secret state is no less powerful now than it was in the Cold War? Will the Government ask the panel of inquiry, if it should find that there have been failures of standards, to propose reforms to the apparatus of deception and secrecy—necessary deception and secrecy—so as to make sure, as far as possible, that there would not in the future be covering up of embarrassments; concealment of crimes; circumvention of parliamentary oversight; and, at worst, manipulation of Ministers and disabling of the proper processes of policy-making?

Everybody must surely welcome without reservation the appointment of Sir Malcolm Rifkind to chair the ISC. Will the Government consider further empowering the ISC so that it can have access to persons and papers as it requires, without having to seek special permission from Ministers, case by case; and supplying it with a stronger secretariat to enable it to use those powers, so that if the parliamentary committee has the political will, it will be better able to do the job of exercising oversight and ensuring accountability to Parliament?

[Lord Strathclyde]

My Lords, it is because all those who have spoken today and the Government care so much about the integrity and reputation of the security services that we have made this Statement. It is not just about their reputation in the United Kingdom. What is so important is the international reputation of the security services. That is why we need to find out the truth of the allegations. When the inquiry comes to its conclusions, we will be able to see what action, if any, needs to be taken. None of us is in favour of anything being covered up, whether the defence is in the public interest or not. We wait for the inquiry to reach its conclusions.

As for the ISC, I am glad of the noble Lord’s welcome for the chairman, Sir Malcolm Rifkind. I think we all agree that he will do an extremely good and useful job. On the ISC generally, the Government are committed to maximising the role of the oversight mechanism, which is why the Prime Minister has appointed a strong and experienced chairman who has committed to serving for the full parliamentary term and to undertaking a serious work programme, including public hearings. What “maximising the role of existing oversight mechanisms” means at this stage is something that will be reviewed in due course.

Energy: Renewables

Lord Strathclyde Excerpts

Monday 5th July 2010 Lords Chamber

[Lord Lawson of Blaby]

My Lords—

[The Chancellor of the Duchy of Lancaster (Lord Strathclyde)]

There must be room for both noble Lords to speak. Why do we not have first my noble friend Lord Lawson and then the noble Lord, Lord Howarth?

[Lord Lawson of Blaby]

I am grateful to the Leader of the House. Is my noble friend aware that only a couple of days ago, Mr Bob Wigley, the chairman of the previous Government’s Green Investment Bank Commission, stated that meeting the requirements of the absurd Climate Change Act will cost the United Kingdom £50 billion a year, every year, for the next 40 years. How—above all in this age of austerity—can this possibly be justified?

Business of the House

Lord Strathclyde Excerpts

Thursday 1st July 2010 Lords Chamber

Moved By

[Lord Strathclyde]

That leave be given to advance the Report stage of the Academies Bill [HL] from 7 July to 6 July.

[The Chancellor of the Duchy of Lancaster (Lord Strathclyde)]

My Lords, it may be helpful if I explain that, following constructive discussions among the usual channels, it has been agreed that it may be for the convenience of the House to make more time available for the Report stage of the Academies Bill on Tuesday 6 July, in addition to the time already set aside on Wednesday 7 July. I am also grateful to my noble friend Lord Goodlad and to the noble Baroness, Lady Cohen of Pimlico, for their co-operation.

Motion agreed.

Business of the House

Lord Strathclyde Excerpts

Thursday 1st July 2010 Lords Chamber

Moved By

[Lord Strathclyde]

That the debate on the motion in the name of Baroness Perry of Southwark set down for today shall be limited to 2 hours and that in the name of Lord Howe of Aberavon to 3 hours.

Motion agreed.

Broadcasting: Digital Radio

Lord Strathclyde Excerpts

Wednesday 30th June 2010 Lords Chamber

[Lord Maxton]

My Lords—

[Lord Strathclyde]

My Lords, we have room for one more question.

[Lord Maxton]

Given that the Government are continuing their commitment to provide broadband to every household in this country by 2012, and given the very rapid development of technologies around mobile phones, is it not the case that this debate is totally irrelevant and that the future lies with internet radio, not with digital or analogue?

Business of the House

Lord Strathclyde Excerpts

Tuesday 29th June 2010 Lords Chamber

Moved By

[Lord Strathclyde]

That Standing Order 40 (Arrangement of the Order Paper) be dispensed with on 5 July to allow the Motion to approve the draft State Pension Credit Pilot Scheme Regulations 2010 to be taken after the Motion standing in the name of Earl Attlee.

Motion agreed.

House of Lords Reform

Lord Strathclyde Excerpts

Tuesday 29th June 2010 Lords Chamber

Moved By

[Lord Strathclyde]

That this House takes note of the case for reform of the House of Lords.

[The Chancellor of the Duchy of Lancaster (Lord Strathclyde)]

My Lords, I for one am delighted to have been able to find this very early opportunity in the lifetime of this Parliament to discuss your Lordships’ House. I can say to noble Lords who have an interest—and many do—that this is the first of such opportunities that we will have to discuss the future of this House.

[Lord Corbett of Castle Vale]

It is a mockery!

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[Lord Strathclyde]

The noble Lord who asked a question a moment ago is now leaving the Chamber.

[Noble Lords]

Order!

[Lord Strathclyde]

So I shall not bother telling him the good news about how often we hope to hear him speak in these quality debates over the next year.

Before the election, we knew that if Labour had won we would now be faced with a Bill based on Jack Straw’s committee paper, seeking to legislate on an elected senate in Labour’s historic fourth term—but that was not to be. Equally, we believed that, with a Conservative victory, reform would not be such an urgent priority and we could continue to seek a consensus for a long-term reform. Under the coalition Government, the three main parties all share similar objectives and the issue has now been given greater priority. Today’s debate is an opportunity for the Government to lay out the structure of their plan and an opportunity to listen to the views from your Lordships’ House.

There were more speakers who had put their names down on the speakers list but decided not to go ahead. Some have written to me with their views, but, as I said a moment ago, this, I think, will be the first of such opportunities to discuss the future of this House.

We seem to have been living with propositions for reform of your Lordships’ House for years, indeed decades. It is neither the most important question facing the country nor the least important; this is one House in a sovereign Parliament. It is a House that has often been proved right in recent years, but its voice needs to be better heard. Your Lordships’ House does an outstanding job, but it has not been able to avoid this country having a near disastrous experience from a surfeit of spending, legislation and regulation. We have done what we can well, but it has not always been enough to achieve all that we wanted, whether that was in the fields of ancient liberties, choice or plain old common sense. If the first job of your Lordships is to call the Executive to account and to challenge the other place to do its job, we have not lately excelled. It is at least legitimate to ask if one of the constraints on our ability to act lies in how we are constituted.

There have been years of debate since the 1999 Act changed this House for ever by ending the right to sit by virtue of hereditary peerage alone. We have seen umpteen schemes and watched them drift down umpteen backwaters, often with many here cheering loudly as they ran aground in the mud. We have seen umpteen propositions for change within the House, with my noble friend Lord Steel of Aikwood perhaps the most persistent in his bid to create the wholly appointed House that both Houses rejected in 1999. Many have hoped that it would all go away, but it has not. Indeed, all three major national parties promised a largely elected House in their manifestos only a few weeks ago, while the SNP pledged our abolition outright. A reformed House could play a great part in pulling together the voices of the devolved nations. No wonder those who would divide our kingdom see no place for any upper House, representative or not. That is a view that I totally reject. I have no doubt that this country needs a second Chamber with authority in all parts of the kingdom—one with confidence, powers and the willingness to use them in the public interest, even as the House that we now have acted to protect jury trial, defend habeas corpus and rejected the tyranny of electronic surveillance by compulsory ID cards. Can we create a Chamber better able to do all those things? That is the question before us. I believe that we can. Others believe that nothing under the sun could be better than this. As Leader of the House, I want to ensure that the voice of this House is heard from the outset in this debate, as sadly it was not always—indeed, some argue ever—heard in the past decade.

The coalition Government’s declared intention is to bring forward a draft Bill on reform of the House, which will provide a proper focus for debate and decision. It is something that I and many other noble Lords called for many times over recent years. My noble friend Lord McNally and I will set out the government agenda, but we are also, just as importantly, here to listen to your Lordships’ views. I can promise you this will not be the last opportunity. I know that many of your Lordships will have greeted this element of the coalition’s programme for government with a degree of apprehension, although the work of the cross-party group led by the former Lord Chancellor, Mr Straw, set it at the heart of the programme of the party opposite, too.

I hope that we will be able to reassure the House today that your Lordships, indeed both Houses, will have a full opportunity to take part before ever any legislation is introduced. In our programme for government, we said we would establish a committee to bring forward proposals for a wholly or mainly elected upper Chamber on the basis of proportional representation. We have done that. My right honourable friend the Deputy Prime Minister is chairing that committee, which is composed of members from all three major political parties as well as from both Houses. My noble friend Lord McNally, the noble Baroness, Lady Royall, and I all serve on it. The committee is charged with producing a draft Bill by the end of the year.

[Lord Barnett]

Whatever is in manifestos, the plain fact is that at the moment the Front Benches of this House are on this committee and, as the noble Lord and all sides of this House know very well, in advance of a debate the Back Benches do not agree with the Front Benches. Why is there not a single Back-Bencher on that committee?

[Lord Strathclyde]

Because, my Lords, this committee is charged to create a Bill in draft. There will be a full role for Back-Benchers in both Houses, on all sides and with different views, when we set up a Joint Committee of both Houses which will then give it the scrutiny it deserves before it is introduced to each House.

[Lord Grocott]

Could the Leader of the House, in the spirit of the coalition document, referring as it does to the importance of transparency, ensure that the agenda and minutes of this committee which is meeting at present are made available to the House and to the public?

--- Later in debate ---

[Lord Strathclyde]

I am very happy for the noble Lord, Lord Grocott, to discuss that with the Leader of the Opposition, who sits on the committee, but the Government will not be publishing either the agenda or any minutes because our objective is to come forward with a Bill in draft. That will be the result of the committee and we hope to do that before the end of the year. This will be the first time that legislation setting out how an elected second Chamber might be constituted will ever have been published by any Government.

[Lord Hannay of Chiswick]

Before we leave the matter of the composition of the committee, perhaps the noble Lord could explain why representatives of three of the main groups in this House are on that committee while the fourth group—the Cross-Benchers—is not represented? In order to save him from doing something which will irritate those around me quite a lot, will he please not say that it is because we have already made up our minds as to the shape of a future House?

[Lord Strathclyde]

My Lords, I have no desire to irritate the noble Lord or, indeed, his noble friends, but the point is that the three main political parties each had a manifesto at the last general election which was broadly in agreement. The Deputy Prime Minister took the view that it was important to bring those political parties together in drafting the Bill. When we get to the creation of the Joint Committee of both Houses, the noble Lord and others of his views—not just on the Cross Benches, but elsewhere—will quite rightly be fully consulted and represented on that committee.

[Lord Hughes of Woodside]

Does the noble Lord agree that the path that he has now undertaken means that the House will be presented with the choice of the three political parties? It is a bit like Henry Ford: “You can have any choice you like, so long as it’s mine”.

[Lord Strathclyde]

My Lords, in a way that is how it works in Parliament. Governments propose legislation and then Parliament disposes of it in whichever way it wants—and that will happen. I am sure that what the Government publish and what comes out of this committee at the end of the year is not where we will be at the end of the day. This is the start of the process. It will be up to the two Houses to set up the Joint Committee; it is not the job of government. My noble friend Lord McNally, the Deputy Leader, and I will make the case for the inclusion of all strands in this matter.

[The Earl of Onslow]

I am normally an enormous fan of my noble friend on the Front Bench, but surely his argument about not including Back-Benchers is slightly destroyed when it becomes a cartel of the three Front Benches. If it was solely my noble friends on the Liberal Front Bench and my noble friends on the Tory Front Bench, his argument would be absolutely solid. However, as it has included the Labour Front Bench, which as far as I have gathered is not part of the coalition—even though 1931 might come again—surely to exclude Back-Benchers is not a sensible idea.

--- Later in debate ---

[Lord Strathclyde]

My Lords, the point I was trying to make is that Back-Benchers will play their full part in the process when we get to the creation of the Joint Committee of both Houses. The committee that the Deputy Prime Minister chairs, with all his might and authority, is designed to create the Bill that your Lordships and others can then comment on. I suggest that we are not going to agree on this issue this afternoon, but I hope that we can move on.

[Lord Campbell of Alloway]

Is my noble friend the Leader of the House aware that there is another point of view? On 5 July, the question of due process concerning the setting up of this committee and its functions is due for consideration. There are two views. One is that of my noble friend the Leader of the House and the other is certainly my own.

[Lord Strathclyde]

My Lords, I am well aware that there is more than one view on this issue. Today we will hear from 68 speakers and we may well end up with more views than there are speakers. The point of the Deputy Prime Minister’s committee is to produce a Bill. Then a Joint Committee will examine it and that will have representatives from the Cross Benches and the Bishops’ Bench. I look forward to them playing their full part in it. We would not wish to exclude anybody from this process. That is likely to mean that it will be a substantial committee. It will have a substantial job to do, but that will be next year’s job, not this year’s.

[Lord Richard]

The noble Lord has been very good in giving way. Perhaps he could help me a little. I understand that this committee will produce a Bill. Will it produce a Bill in a legal form, properly drafted by parliamentary draftsmen? Will parliamentary draftsmen be attached to a committee of the three Front Benches to draft a Bill? Is that really the position, so that when the committee reports we get a Bill in draft—which can be introduced in the House—and carry on from there?

[Lord Strathclyde]

My Lords, yes. I would hope that the noble Lord would not be so incredulous. One thing that has been missing from this great debate is precisely that—a Bill in properly drafted form. It will not be introduced to Parliament as part of a legislative process, but as part of a pre-legislative process for proper discussion. I am not going to give way too often.

[Baroness Farrington of Ribbleton]

My Lords, I hope I can save the noble Lord the Leader of the House a little time. Will the draft Bill that is being produced by the committee deal with transition? I think it might shorten the number of speeches today if the noble Lord could be more forthcoming on that.

[Lord Strathclyde]

My Lords, yes, it will deal with transition, which is one of the most important issues. I do not suggest for one moment that the noble Baroness will agree with whatever we propose, although she might. I cannot tell her what it will be because we do not know either at this stage. It is still very early days. However, the Bill will cover that subject, as it must. Once the Joint Committee has completed its work, at the end of the process, it will be for the Government to decide whether to bring forward legislation. I hope that by the time we reach that point, this House will have had the opportunity for input—first into the work of the committee, and then that of the Joint Committee—before we get to a final decision.

[Lord Rooker]

I seek clarification on this point. Like other Members, I have read all three manifestos, which all talked about the House being mainly or wholly elected. Not one of them raised the issue of what this place is for. At what point will the House get the chance to debate what a Second Chamber is for, what it is to do and what its powers are? Surely, all we are talking about at the moment is its composition, which seems to be the wrong way round.

[Noble Lords]

Hear, hear!

[Lord Strathclyde]

My Lords, the noble Lord, Lord Rooker, was a senior Minister in the former Government. They must have debated these issues many times in the build-up to the 2008 White Paper. Of course we have to decide what this House is for and what it will do. The view at the moment is that the House should continue to have the powers that it holds and do the work that it does. We are looking at its composition and how people get here, rather than what they do once they get here. I have hardly started in my speech. I will give way to the noble Lord, Lord Phillips, and then I will get on.

[Lord Phillips of Sudbury]

I am most grateful but, in the light of all the peculiar circumstances, it is important to know that, when the Bill is brought to the House, it will not be whipped so that there can be a genuinely free debate.

[Lord Strathclyde]

My Lords, I have consistently taken the view over a long period—I am not saying that I will retain that consistency—that whipping a Bill on reform of the House of Lords is a particularly fatuous exercise as I suspect that Peers will make up their own minds, almost whatever the Whips tell them. However, we are a long way from having legislation on which we need to take a view on whether it will need to be whipped.

The coalition agreement, which noble Lords will have seen, envisaged a wholly or mainly elected House with elections on the basis of proportional representation. As the noble Baroness pointed out a moment ago, it also anticipated the transitional arrangement that a “grandfathering” system would be put in place for current Members of the House. I know that noble Lords will be anxious to know what both these things mean. They mean that we as a Government have yet to take a view—

[Noble Lords]

Oh!

--- Later in debate ---

[Lord Strathclyde]

We have yet to take a view on whether a reformed House should be fully or partly elected. Those words mean that we recognise the case for an orderly process of transition if the composition of the House is to change, just as in 1999 both Houses saw the wisdom of retaining a transitional element from the old House.

As I said at the outset, this House can be proud of so much that it does, but it lacks democratic authority. As a result, I believe that it does not carry the weight that the quality of its work merits. While we remain an overwhelmingly directly appointed House—something like 85 per cent appointed as against 50 per cent before 1999—our membership continues to grow. It is now fast approaching 800, with daily average attendance rising over 400. More new Members are due to be introduced over the coming weeks and months. I believe that it is time to examine what avenues could be created to make it possible for Members to leave the House permanently. To this end, I can announce that I will be setting up a Leaders’ Group, chaired by my noble friend Lord Hunt of Wirral, to investigate the options available. The group will include representation from all sides of the House and will be tasked with identifying the options that could be considered to allow Members to leave or to retire from the House.

Over the past 18 months, public confidence in politics, but more especially in Parliament, has been dramatically eroded. While many may reject the case for change, both Houses must surely consider it. Some in this House did not want change in Parliament in 1832, 1911, or, indeed, that much in 1999. Incredible though it may seem, the party opposite even voted against the creation of the life peerage in 1958. However, we came to accept all these great changes, just as in 1958 the then hereditary House accepted the case for change.

We cannot know precisely how this debate will unfold, but we know that it cannot be avoided. A great debate is beginning, or perhaps for some of us it is restarting. This House of all places cannot sit this one out. There is not a single Peer, whatever his or her views, who does not love this place, understand the need for a stronger Parliament and want the best for our House. This House, and its Members, must be at the heart of the debate ahead. I want to ensure this House a place in that process. That is the reason today’s debate was arranged. I look forward to all the contributions that will follow today and in the months ahead. I beg to move.

House of Lords Reform

Lord Strathclyde Excerpts

Tuesday 29th June 2010 Lords Chamber

[Lord Steel of Aikwood]

My Lords, I said at the beginning that I would listen to the debate. I have been encouraged by the strong support for my Motion. Therefore, I propose to move it without making another speech but I will simply clarify two things. Contrary to what the noble Lord, Lord Lucas, said, the Motion is not an alternative to the resolution of the noble Lord, Lord Strathclyde; it is a precursor to it. It is clear that the course on which the Government are embarked will take at least the five years of this Parliament. We need running repairs now. If the four separate resolutions are passed—I stress to my noble friend Lord Caithness that they are separate and might not all be passed—there is no reason why draft or full legislation could not be introduced in the autumn. Three of the points are already in legislative form from the previous Government. Therefore, the legislation could go through during this Session and we could achieve the running repairs which this House so badly needs. I beg to move.

[The Chancellor of the Duchy of Lancaster (Lord Strathclyde)]

My Lords, I am surprised that this Motion has been moved. I was rather hoping that the debate we have had over the last few hours would have been enough for your Lordships, so I have not prepared many words. However, the Order Paper is a serious document, and if Motions are tabled and moved they need to be taken seriously, so I should formally respond to the noble Lord, Lord Steel of Aikwood.

This is an unusual Motion. I have never seen one quite like it before and we are taking it at an unusual time of night. It is unusual because it is unclear what its intended effect is. On the advice that I have received, it does not bind the Government to do anything. It simply asks the House—or gives it the opportunity, which it can take at any stage it wants—to give an opinion on various matters. It does not inexorably lead then to any legislation. From that point of view the Motion is rather pointless, though I am sure the noble Lord, Lord Steel, when he replies, will explain why it has a point and what that point is.

The Motion asks the Government to table Motions which could approve or disapprove certain requirements. In my speech this afternoon, some hours ago, I explained that I had had cause to set up a Leader’s Group that will look at the position of retirement of Members from this House permanently, and that the group would be chaired by my noble friend Lord Hunt of Wirral. I would hope that that would have dealt with that. There is certainly no scheme. The noble Lord, Lord Steel, does not have a scheme; I do not have a scheme. We are all rather hoping that my noble friend will be able to come up not necessarily with one scheme but many different schemes. There are several options. The whole point of my noble friend’s job is to try to find out what these options, and their pros and cons, are. Therefore, I do not see that there is any particular point on that because I think there is a substantial desire in this House to have a scheme for retirement. I was rather hoping that there would be a murmur of approval for that.

[Noble Lords]

Hear, hear!

[Lord Strathclyde]

Since we are on a roll, how many noble Lords would like to take up that scheme for permanent retirement? I am very happy to take an interruption at this stage.

[Lord Richard]

It depends what the scheme is.

[Lord Strathclyde]

The noble Lord, Lord Richard, proves my point and I am immensely grateful to him. We are going to investigate whether there should be a scheme.

The noble Lord, Lord Steel, wants to have a vote on the abolition of by-elections for hereditary Peers. I can confirm to the House that when we publish a Bill at the end of this year, which is only a few months away, there will be not only a proposal for the abolition of by-elections for hereditary Peers but one for a very substantial cut in the number of life Peers under the Life Peerages Act 1958. That is the by-product of going down this road.

The noble Lord has put down only four suggestions. He could have had a fifth: whether or not there should be an elected or an unelected House—as if there were any doubt about that, incidentally. His next proposal concerns the removal of Members convicted of serious criminal offences. Frankly, I was surprised to see this because I cannot imagine that anybody would not be in favour of having a statutory scheme similar to that of the House of Commons. It is certainly our intention that this should be covered in the legislation when it comes forward, once we have had a suitable debate on that subject. The provision already applies in another place; there is no good reason why it should not apply here.

The creation of a statutory appointments commission is infinitely more complicated and is the most difficult and controversial aspect of the noble Lord’s proposals. It is difficult and controversial at least in part because the appointments system that we have already seems to work pretty well. Many of the Peers on the Cross Benches came out of the Appointments Commission and they show up that commission rather better than many of us had imagined would be the case. However, if we still had an appointed element in this House, there would have to be some kind of system, and it would be very surprising if that was not a statutorily-based system.

[Lord Lea of Crondall]

Is the noble Lord not aware that, in introducing his Motion, the noble Lord, Lord Steel, said that it applies to the period between now and the never-never land when the Bill will come into operation? To say that this will all be covered by the Bill and that the hereditary by-elections will automatically ipso facto go at that time does not address the point made by the noble Lord, Lord Steel.

[Lord Strathclyde]

But of course it does. The Government have pledged to produce a Bill by the end of the year. I could ring up the parliamentary draftsman tomorrow morning and say, “We have a cracking good idea. We have four marvellous suggestions that none of us has thought of before. Please draft a Bill”. These measures require legislation. They cannot just be willed. They cannot just happen.

[Noble Lords]

There is a Bill.

[Lord Strathclyde]

But it is not a government Bill. It has been introduced several times and found to have enormous flaws. A responsible Government would have to ask a parliamentary draftsman to draft a measure. The noble Lord with his government experience knows this. We would need to do that at the earliest opportunity. We are going to fast track this. It could not be published before October or November. That is just a few weeks before we will publish our own Bill. I do not think that I could go to the committee of parliamentary business managers and say that the House of Lords wants an advantage of just a few weeks to discuss in government time the Bill of the noble Lord, Lord Steel. With the best will in the world, that is not going to happen.

All that I will say is that it has been a tremendous debate. I am glad that I have been able to answer the points made by the noble Lord, Lord Steel of Aikwood. He has been very patient for a number of years. Now we are asking him to be patient for a few more months and he will get everything that he wants and probably deserves.

[Lord Steel of Aikwood]

All that I would say to that is that I do not want to wait for another five years. We need these matters to be resolved now. I beg to move.

Financial Provision for Members

Lord Strathclyde Excerpts

Monday 28th June 2010 Lords Chamber

[The Chancellor of the Duchy of Lancaster (Lord Strathclyde)]

My Lords, I wish to make a Statement on future financial provision for Members of this House.

In my view, we need fundamental change. None of us wants to live through again what we lived through in the last Parliament. In a House in which the overwhelming majority of Peers have always acted on their honour, we found ourselves severely criticised. All too often, that criticism was fully justified. The parliamentary expenses regime was opened up to public view, and the public saw a system that was badly broken. Difficult questions were asked, abuses were uncovered, apologies have been made and prosecutions are pending. We could not let this continue, and I pay tribute again to the contribution made by the noble Baroness, Lady Royall. Once problems were uncovered, she acted decisively, and the House is indebted to her.

We received a report from the Senior Salaries Review Body. Building on that report, my noble friend Lord Wakeham was invited to lead an ad hoc group to consider, consult and advise on the implementation of a new system of financial support. The group has now submitted its proposals to the House Committee, and its report, entitled Financial Support for Members of the House of Lords, is now available in the Printed Paper Office.

The Wakeham group supported the SSRB’s idea of combining the current daily subsistence and office costs allowances into one daily allowance. I agree with that. But the group suggests an alternative option, a simplification of the SSRB’s approach to overnight allowances by combining that, too, into one single daily allowance, payable on attendance on each sitting day. If this were done, it would mean the abolition of the expenses regime as we know it, and in future, payment for staying overnight, taxis, meals, secretaries and research assistants would all come out of that single payment. How much Peers spend on each item would be entirely up to them. There would be no extras, no small print. The single payment would be the end of the matter.

Under the current scheme, the maximum some Members may claim per day they attend is £334. The SSRB suggested that this should be £340. If we create a single uniform daily allowance, it should be set at a figure less than these two totals. I recommend £300. This is 10 per cent less than the current maximum and 12 per cent less than the figure recommended by the SSRB. Furthermore, there will be a lower rate at which Members can claim. I suggest that this should be 50 per cent lower at £150.

This is not a salaried House. Attendance will remain the key basis for the allowance—that is what the public expect. But in order to contribute effectively to the work of the House, Peers are often involved in preparatory and other work outside the Chamber and cannot attend, for example, for long periods in Committee. However, I believe that many will consider a lower rate appropriate, for example for Peers who are able to attend the House for only part of a sitting on a particular day.

We are rightly all under scrutiny for our use of public money and the public expect Members of the House to set the same high standards for themselves as they do for others. Some may feel they do not wish to ask for any payment at all. Based on provisional statistics, last year 13 per cent of those who attended the House did not claim any allowances. I hope that they will continue not to. The Wakeham group proposals cover a number of other important issues, including travel arrangements for Members. Its proposals will continue to recognise the additional costs faced by Peers who travel from long distances.

Axing through the current complex structure of expenses would represent radical change, but I believe that that would be right. It also holds other advantages. It would be cheaper to run than any more complex arrangements, less bureaucratic and less expensive to comply with, simpler to police and far harder to abuse. The controversial rules on so-called “second homes” would quite simply be swept away. There will be no more accusations of addresses of convenience, and no more juggling of utility bills and claims forms. If you come to Westminster and work in Parliament, you will be able to claim the allowance. If you do not, you will not.

This will mean a reduction in the amount that some Peers have claimed in the past. But in the present economic climate we cannot protest against a reduction. Indeed, in my own view, with a new system, levels of payments should be frozen for the life of this Parliament. I accept that this is a scheme that will not be welcomed by all, but it will be broadly cost-neutral compared with the existing scheme. The existing expenses regime is discredited. It lacks credibility and the public have lost confidence in it. This new plan means the end of the second homes fiasco. It means the end of expenses in the House of Lords. It means a new system that is direct, transparent and accountable. It means that we are making a significant step towards winning the public’s confidence again.

So, what next? The House Committee will meet soon to discuss the details of this proposal. Before the Summer Recess, I will table resolutions for the House’s approval. This House has suffered greatly from the faults of the previous system and the misbehaviour of a small minority. Ultimately, it is a matter for the House if it wants to make this change. The Government’s view is that we need clarity, simplicity and reform—and that the time for reform is now. I hope that your Lordships will agree, and I commend this Statement to the House.

--- Later in debate ---

[Lord Strathclyde]

My Lords, I am grateful for the broad welcome given by the noble Lord, Lord Hunt of Kings Heath, and the noble Baroness the Convenor of the Cross Benches. I understand why the Leader of the Opposition could not be in her place today, and I am glad that the noble Lord stood in for her in such an excellent manner.

I think the whole House should thank my noble friend Lord Wakeham and congratulate him on the work that he did. He took on an immensely difficult task after the debate that we had last December. It was not clear to me that anyone would be able to find their way around this particular maze, with so many different groups of people wanting different things and dissatisfied with what was being presented. It is a real credit. He did not manage to find his way through alone, though; he did so with the help of a group of individuals from all sides of the House who no doubt helped and encouraged him in his work.

The noble Lord, Lord Hunt, asked some specific questions, particularly about how long I anticipate this process will take and when the new regime will come into force. It is important that we move quickly to the new regime. The House Committee will therefore meet very soon and take a view on resolutions that will be proposed by me. If they are agreed they will be brought to the House. I hope that this will be done in the course of the next few weeks—certainly before the Summer Recess, because I envisage the new regime coming into force on 1 October. The current regime will continue until then.

We will need resolutions, in part to allow the authorities of the House to take them into account when they are creating the new system. I do not believe that anything I have said about the new system will give the authorities in the House of Lords any concern at all about being able to administer the scheme effectively, efficiently and more cheaply than was envisaged under the scheme proposed by the SSRB.

Turning to the points made by the Convenor of the Cross Benches, I recognise that some will be concerned about a net reduction in the amount of money they receive. As the noble Lord, Lord Hunt of Kings Heath, said, this is not a perfect system—nor does it try to be. It tries simply to iron out the worst of the difficulties that we have seen in the current system and the proposed scheme, and it has taken all those things into account.

The noble Baroness was right about all the changes that have taken place during the past 12 months. We have a new code of conduct, a new independent Commissioner for Standards, and we are reviewing the attendance allowances. For the House of Lords, it is a positively revolutionary pace.

The noble Baroness mentioned taxation. That is not a matter for me; it is up to HMRC and the Treasury. However, if the previous scheme was without tax, there must be compelling arguments for this scheme also to be without tax, given that many of the expenses which Peers have are very similar.

The Clerk of the Parliaments has discretion to allow some additional expenses for disabled Members. Nothing in the Wakeham committee report seeks to change that, and there is no reason why it should not continue. The Clerk of the Parliaments has in the past demonstrated an ability and willingness to look favourably on people who need those additional expenses, and I am sure that he will want to continue to do so.

--- Later in debate ---

[Lord Wakeham]

Perhaps it might assist the House if I said a word as chairman of the ad hoc committee. In carrying out our work, we stuck firmly to our remit, which was to stay within the principles and architecture of the SSRB report. However, is my noble friend aware that we found it a complex task to come up with a final solution, which is why we floated the idea of an alternative that would be simpler and cheaper to administer and easier to explain to the outside world? Therefore, I very much support my noble friend’s Statement. As a member of the House Committee, I shall certainly support his proposal.

[Lord Strathclyde]

I have already said how grateful the House should be to my noble friend. He has come up with an immensely useful and helpful report. It is now in the Printed Paper Office and I hope that noble Lords will take the trouble to read it.

[Lord Tomlinson]

My Lords—

--- Later in debate ---

[Lord Strathclyde]

The noble Lord is right that it did not fit into the SSRB’s original report, but that is why my noble friend’s committee chose to offer it up as an alternative—as I understand it—in the light of its discussions. If the noble Lord reads the document, as I have done, he will see a remorseless logic that took the committee from where it started to its providing this idea as an alternative. It is an alternative taken in the round, looking at the bureaucratic costs, at each Peer being treated equally and at the end of the expenses regime, which I have found attractive.

[Lord Dholakia]

I welcome the Statement from the Leader of the House, for three separate reasons. The first is clearly spelt out—the system itself is simple to operate. It removes the complexity of the present system, which has resulted in adverse publicity in the media. Also, it has the least resource implications for administering the system. I have two questions. First, will the noble Lord explain whether there will be a built-in review procedure? The last thing that we should ever do is to determine the allowance applicable to us; we should allow an independent element to determine that. Secondly, will he establish some system of monitoring, given the concerns raised in the past about young people, women and people from ethnic minorities in the prime of their careers? Would the type of review that we are suggesting take those factors into account so that such people are not inhibited from becoming Members of this House?

[Lord Strathclyde]

My Lords, I thank my noble friend Lord Dholakia for his broad welcome. It was important to hear a senior member of the Liberal Democrat Benches on what is, after all, a House matter and I welcome his words. I have not at this stage recommended a built-in review procedure. It is my personal view that the level that we set should be the one set for the rest of this Parliament. Last week, we saw in the Budget proposals for freezing public sector pay and many other aspects, as well as cuts in the public sector more generally. I think that it is a sensible approach to freeze these amounts. As for a system of monitoring, I should emphasise that one reason why I have recommended this proposal is that it is for the interim period between now and when we potentially pass legislation for a future reformed House. That is another reason why it is attractive. Between now and then, I am sure that many people will monitor those who arrive in your Lordships’ House—new Peers. There are reasons why people from ethnic minorities and those raising a family may find the certainty of the new arrangements rather more attractive than the old expenses regime.

[Lord Campbell of Alloway]

My Lords, I do not want to challenge in any way the recommendations of my noble friend the Leader of the House but, for clarification, was the proposal of my noble friend Lord Wakeham accepted by the committee or was it not?

[Lord Strathclyde]

Oh yes, my Lords, the proposal was made by the committee in the report. The noble Lord, Lord Tomlinson, explained his position extremely well; he put in a reservation because he felt that the proposal did not fit the mandate of the committee when it was originally set out.

[Lord Low of Dalston]

My Lords, the Leader of the House made reference in outlining the scheme, which he supports, to an upper and lower level at which the flat rate might be paid. Could he give some indication of what criteria would be used to determine when the upper or lower rate was appropriate? If it is to be based on period of attendance—half day versus full day, as I have seen suggested—how would half a day and a full day be defined and how would attendance be validated?

[Lord Strathclyde]

My Lords, the noble Lord asks an extremely sensible question, one which is not entirely easy to deal with. There is a perception among those outside this House that a few minutes’ attendance reaps the benefits of large sums of money. In my experience, both as a former Chief Whip and as Leader of the House, I regard these abuses to have been exceedingly small; nevertheless, there is that perception. I am also aware that there are some Peers who, because of the nature of their outside work and for other reasons, do not spend a great deal of time in the House. It was felt in the discussions that I had that we should offer an alternative—a lower sum of £150.

Ultimately, it can only be up to the judgment of each individual Peer where and how they make that claim. A Peer may spend only half an hour in the House on a given day but, if they spent the morning reading and preparing for a complicated Committee stage on the next day, how are we to judge whether that time was well spent? In the end, all these claims will be made public. I hope that, with the co-operation of the House Committee and the House authorities, we will be able to make these claims known electronically on a rolling basis so that it will be easy to attach contributions to the amount of money claimed. That will create an internal accountability, which will be useful to Peers and public alike.

[Lord Phillips of Sudbury]

My Lords, I hope that I am correct in understanding my noble friend as having indicated that the new scheme will be wholly divorced from the actual expenses incurred by Members of this House in coming here and undertaking their duties. I think that that is right—the noble Lord is nodding. Therefore, his remarks vis-à-vis taxation assume a more important light. I go back to what he started by saying, which is that this House and, indeed, the other place came under a great deal of unwelcome public scrutiny over the expenses arrangements and that the trust in both Houses was severely dented. Some may think that those wounds are not entirely healed. Would it therefore be acceptable if the noble Lord and, indeed, the noble Lord, Lord Wakeham, and his group were to work on the basis that, whatever arrangements are come to vis-à-vis taxation, we have to accept that the allowance will now leave some Members of this place with substantial remuneration—that is to say, a return well in excess of anything incurred by way of expenses—and that it surely cannot be acceptable that this place, of all places, should expect a privilege in tax terms over any other citizen of this land? For us to say that it is much simpler to claim the entitlement and be done with it is fair enough, but that surely cannot satisfy the test that every other person has to live by, which is that, in terms of the tax charge, they can claim only those expenses actually incurred.

[Lord Strathclyde]

My Lords, my noble friend is entirely correct to point out that the reason why we are even discussing this is because trust has been dented, not just in this House but substantially in another place. Both Houses are, in their own way, trying to find their way through this to come out at the other end with a greater understanding between the public and Parliament, so that we can try to rebuild that trust. My noble friend is also entirely correct to say that this is a move away from the expenses regime. We are not asking Peers to demonstrate what they have spent. In fact, we are not hugely interested in what Peers spend their money on, in where they stay or, indeed, in whom they stay with. What we are interested in is: have they turned up? Have they made a contribution? What should the value of that be?

The SSRB suggested in its report that in due course the expenses regime that it proposed should be taxed. I take no particular view on that. I am not an accountant and it is not a decision for me. It may well be a decision for HMRC and the Treasury to take in due course. My further understanding is that, if tax were payable, that would require legislation and that, if tax were taken off, no doubt many Peers would make the case for some sort of rerating to make an allowance for taxation. These are all issues for another day.

There is another view, which I laid out a few minutes ago. We hope that there will be legislation on a reformed House. If there is a reformed, elected House, those Peers—or senators, or whatever they are—will be paid. There is then the prospect in that legislation for another independent body—perhaps IPSA itself—to look at what the recommendations should be.

[Baroness McIntosh of Hudnall]

My Lords, does the Leader accept that there are people around the House, including me, who may be significantly worse off under the new regime but who none the less welcome the proposal that has come from the noble Lord this afternoon? I agree substantially with the noble Lord, Lord Phillips of Sudbury. If we go ahead with this, we cannot expect to retain all the advantages of both the previous system and the new system and to suffer no change in how our tax status is viewed. The main benefit of the new proposal is that it ensures that the way in which your Lordships may be supported or remunerated—the noble Lord, Lord Phillips, suggested that it might amount to remuneration in future—bears some clear relationship to how people outside this House are paid for their services. As well as transparency and accountability, it feels at this moment as though we should be demonstrating not that we are so different from the rest of the world that we cannot be treated in the same way as other people, but that our work bears a distinct and reasonable relationship to what is done elsewhere and therefore we should be treated very similarly to people outside this House.

--- Later in debate ---

[Lord Strathclyde]

I thank the noble Baroness, particularly for her remark that she was likely to be one of those Peers who might end up with a little less money than under the old regime but still felt that this was the right way to go. That is a very sensible conclusion to come to. It also puts us on a different footing from the expenses regime. Some Members of this House will take some time to appreciate the difference in the change that has taken place. Expenses will no longer be claimed. There will be an allowance, depending on attendance. The noble Baroness is right: that brings the relationship to the general public closer. There was a time, perhaps many years ago, when the fact that Peers were unpaid and received an element of expenses was justifiable. As the years have gone by, that has become increasingly difficult to justify, which is why we need to make the change.

[Lord Alton of Liverpool]

My Lords, one of the most attractive things that the noble Lord, Lord Wakeham, has enabled the Leader to say today is that this will be cost-neutral, because the public, as they look at this, will ask, “Will there be an increase in what Members of the House of Lords receive in the future?”. However, is one of the other attractions not the simplicity of the system? It removes some of the ambiguities that many of us have felt uneasy about in the past. In responding, could the Leader return to the question that my noble friend Lady D’Souza asked about the separation of money that is claimed for travel? That is never received by any individual Peer and yet appears in the receipts of money that is claimed by Members of your Lordships’ House. There is surely a desire on all our parts to continue to encourage those of us who come from the far-flung parts of the United Kingdom to carry on coming here; we do not want to turn your Lordships’ House into a purely metropolitan establishment that draws only on Greater London. Is it not important that we show that separation? I also ask the Leader about the position of staff. Members of your Lordships’ House have research assistants or secretarial staff who are currently supported during recess with a specific payment. What will be their position in the future?

[Lord Strathclyde]

My Lords, the noble Lord, Lord Alton, made a straightforward case for the attractions of this in that it removes ambiguities with which many Peers have felt uncomfortable. Although they believe that they were on the right side of the line, they felt that they still had to explain themselves and to justify the position that they had taken. At a stroke, those ambiguities are removed. It is my assessment, with a little help from the House authorities, that this is cost-neutral. Potentially, there will be an added advantage of a reduction in the cost of the bureaucracy should we have had a more complex system of expenses.

Travel expenses will continue to be paid as before, although my noble friend Lord Wakeham and his committee make one or two suggestions on the SSRB’s report. There is already a different column for the declaration of travel expenses. I agree with the noble Lord that it is sometimes unfair that, because a Peer’s travel expenses are very high because they come from the far-flung parts of the United Kingdom, that puts them at the top of the list of those who have claimed expenses. Every year, we urge the media when they report on these things to take the travel expenses firmly into account. As the noble Lord has seen, they do not always listen to what I regard as wise advice.

Staff will be paid for by Members out of whatever resources they have, including the new £300 allowance. It will be up to Members to decide how best to do that over the year. There will be no extra or additional secretarial allowance paid during sitting days or recesses.

[Baroness Jay of Paddington]

My Lords, perhaps I may reinforce the comment made by the noble Lord, Lord Alton, about good employment practice with members of personal staff, particularly secretaries, who cannot be laid off in terms of good employment practice for three months in the summer and then reappointed. There may be something to be looked at further than that. On a broader point, has the noble Lord considered that, in pursuing the question of House of Lords reform and the endless question of how to deal with those Members of the House who are already here, if we abandon, as he is proposing, an expenses regime, one of the issues in principle about getting people to retire or asking them to leave will be overcome because there will be no reason why, in principle, some sort of pension should not be paid to them?

[Lord Strathclyde]

My Lords, it is typical of the noble Baroness to raise such a deeply controversial subject in the manner that she has. Tomorrow, we will spend many hours discussing all these issues. No doubt, the question of transition will come up. The noble Baroness, with all her experience, has spotted that in terms of transition there is a real difficulty about how we move from one House to the other. I can assure her that these issues are uppermost in our minds.

[Lord Marlesford]

My Lords, in relation to the point on tax, which was raised by my noble friend Lord Phillips of Sudbury, the noble Lord may not be aware—although obviously the Leader of the House will be aware—that in the detailed documents attached to the Budget Statement, it is said that HMRC will have to amend the rules to enshrine the long-established practice that expenses received by Members of another place are not taxable. In other words, it is proposed to retain the system whereby Members of another place are not taxed on their expenses because, as the note says, with the arrival of IPSA the determination of expenses for the House of Commons is no longer quite the same. That is being dealt with in another place.

On the more general point, it is welcome that transparency and simplicity are important and overriding considerations. There is another consideration as to whether the taxpayer will regard £300 a day as good value for money. Is it a little bit relevant that for many professions such as doctors, accountants, lawyers and others, £300 buys about one hour of their time?

[Lord Strathclyde]

My Lords, what my noble friend said about taxation, HMRC and Members of another place shows how complicated this issue is. There is already a whole variety of rules for Parliament and, as the noble Lord, Lord Alton, said, if you give money to research assistants, it is almost going through individuals’ hands, and HMRC may indeed wish to take all of that into account. That is the start of a wider debate that I do not wish to continue this afternoon.

I have also wondered about the figure of £300. I am sure that some members of the public would regard that as being extremely good value, when they look at the quality of the work that they are getting from individual Peers, and others may not. It is important for us all to demonstrate that when we claim this money we are working for it and playing a full part in the legislature of which we are all members.

[The Lord Bishop of Exeter]

My Lords, we on these Benches have not taken a particular view on these matters beyond believing that any system should be fair, transparent and clearly good value for the public purse; but sitting on these Benches involves becoming very aware of, and developing a great appreciation for, the tremendous hard work on the part of all working Peers on all Benches. One is also aware of how much of that work continues beyond the House going into recess. Is there not a stronger case for looking again at the resourcing of working Peers out of the House’s sitting time to ensure that they are properly resourced to undertake their important public role and that no one is left unnecessarily out of pocket?

[Lord Strathclyde]

My Lords, the right reverend Prelate’s point about pay outside sitting days has been raised many times. This scheme will pay £300 per sitting day only, and the judgment that I and others who have looked at this matter have taken is that that amount should keep Peers going when we are not sitting. It is entirely fair enough to say that the totals do not add up to as much as full-time Peers can currently claim, but, as I said in my Statement, in today’s economic climate it is right for us who gain the most to say that we are happy to take a reduction.

[Baroness Symons of Vernham Dean]

My Lords, does the Leader of the House agree that a number of the questions that are being raised are dealt with in the report by the noble Lord, Lord Wakeham. We have spent a great deal of time discussing taxation. The question of additional office costs is also dealt with in the report, as are the important questions raised by the noble Baroness, Lady D’Souza, about long periods of illness. The noble Baroness’s point was not about the powers of the Clerk of the Parliaments to give additional help to noble Lords who have, for example, mobility difficulties, it was more about what happens during extended periods of illness and some of the representations that have been made in relation to them. We are starting to move into a more detailed debate.

I support, as the noble Lord, Lord Wakeham, does, the thrust of the additional element brought into this report—the alternative suggestion. Of course my noble friend Lord Tomlinson is right to say that this was not included in the principles and architecture of the SSRB report. That is why the noble Lord, Lord Wakeham, explicitly states in his report that he is moving outside the architecture and principles described in paragraphs 5.56 and 5.57. That notwithstanding, it is possible to move outside it because circumstances have changed. Clarity, transparency and simplicity are what we should aim for.

[Lord Strathclyde]

My Lords, the noble Baroness has been extremely helpful. As a leading member of my noble friend Lord Wakeham’s group, she has also demonstrated that there is an enormous amount of detail in my noble friend’s report. I hope that, when read in conjunction with my Statement today and with the report of the SSRB, it will make everything considerably clearer.

I accept what the noble Baroness said: perhaps I did not answer the Convenor of the Cross Benches sufficiently well when she asked about periods of illness, particularly for Members of the House who are severely disabled. I have never opposed any attempt to find a regime for a very few special cases. We are one of the few legislative assemblies to have allowed severely disabled people to play their part. I am sure that if the noble Baroness were to invite the House Committee to re-examine these issues, she would receive a positive response.

[Lord McIntosh of Haringey]

My Lords, my question is about the word “attendance”, which sounds very simple. I spent the past week at the parliamentary assembly of the Council of Europe in Strasbourg, where they have changed the rules. You get your hotel paid, and a smaller amount than used to be the case for subsistence. I was in Macedonia earlier this month, where the subsistence amount was the munificent sum of €28—in addition to the hotel, which they chose. Those who serve the House away from the House, such as members of the Council of Europe and the Western European Union—are they not attending the House for the purpose of this exercise?

[Lord Strathclyde]

My Lords, it is not envisaged that the attendance rules will be changed for Peers who are working outside the House. The current rules are clear about what can be claimed when Members are outside the House, and it is not intended that that should change.

[The Earl of Onslow]

My Lords—

G8 and G20 Summits

Lord Strathclyde Excerpts

Monday 28th June 2010 Lords Chamber

[The Chancellor of the Duchy of Lancaster (Lord Strathclyde)]

My Lords, it may be a convenient moment to turn to the second Statement, which was made a few minutes ago by the Prime Minister in another place.

“With permission, Mr Speaker, I should like to make a statement on the G8 and G20 summits which took place in Canada. First, I am sure the whole House will join me in paying tribute to the seven British servicemen who have lost their lives in the past week. From 40 Commando Royal Marines: Sergeant Steven Darbyshire. From 1st Battalion the Mercian Regiment: Colour Sergeant Martyn Horton, Private Douglas Halliday, Private Alex Isaac. From the Yorkshire Regiment: Lance Corporal David Ramsden. From the 4th Regiment Royal Artillery: Bombardier Stephen Gilbert, who died from injuries received in an explosion earlier this month; and the soldier from 101 Regiment Royal Engineers who died yesterday. As the country marked Armed Forces Day this weekend, people did so with tremendous pride but also great sadness. We will never forget what these men and so many of their colleagues have given for us.

As I have said, I am determined that our forces will not stay in Afghanistan a day longer than necessary. I led a discussion at the G8, where we made it clear that we ‘fully support the transition strategy adopted’ by international partners. We are not after a perfect Afghanistan—just a stable Afghanistan, able to maintain its own security and prevent al-Qaeda from returning. So the G8 sent a collective signal that we want the Afghan Security Forces to ‘assume increasing responsibility for security within five years’. The presence of large-scale international forces cannot be an indefinite commitment. We need to get the job done and bring our troops home.

Let me report to the House on the main conclusions of the G8 and G20. I have placed copies of the communiqués in the Library so that people can see the details of what was agreed. The G8 is a good forum for the leading democratic economies to give proper strategic consideration to the big foreign policy and security issues. It also plays a vital role in helping the richer nations to improve the future of the poorest. In my view, these two vital functions of this forum should continue. Let me take each in turn.

On the big security issues, we discussed the Middle East peace process and agreed the importance of putting pressure on both sides to engage in the proximity talks with the aim of creating the conditions for direct talks. President Obama specifically said that he would make this his priority in the coming months.

While the changes that Israel had proposed are welcome, they do not go far enough, and the communiqué says that the current arrangements in Gaza,

‘are not sustainable and must be changed’.

On Iran, UN Security Council Resolution 1929 was welcomed. The communiqué states that all countries should “implement it fully”. Since the G8 includes Russia, Britain believes this was significant.

The UK also made the case for all members of the G8 to have positive engagement with Turkey, which could have a key role to play in resolving both the Iran issue and encouraging progress on Middle East peace. We also discussed North Korea, deploring and condemning the sinking of the “Cheonan”, nuclear disarmament and non-proliferation.

On development, while the G8 has played an important role in increasing aid spending by the richest countries in the world, some of those countries have not met the commitments they set out. I stressed the importance of transparency and accountability, and the accountability report sets out what countries have done in meeting their commitments. While not perfect, it is really good progress in making sure that countries cannot make promises without being held to account for them.

Even at a time when our countries face difficult budget decisions, it is important we maintain our commitment to helping the poorest in the world. The UK is maintaining its commitment to increase spending on aid to 0.7 per cent of gross national income. This gives us the opportunity to exercise leadership. At the same time, in order to take the public with us, we also need to make sure that every penny will reach those who need it most—that means transparency and accountability. It also means that the projects we support must be deliverable, practical and measurable, addressing the causes of poverty and not just its symptoms.

The Muskoka Initiative is a case in point. Today in the UK, the chances of dying in pregnancy and childbirth are one in 8,200. In parts of Africa, it is as low as one in seven. This is something we can change—and we must change. The resources agreed, including a big contribution from the UK, could lead to an additional 1.3 million lives being saved. As the White Ribbon Alliance points out, if you save the mother, you save the family; and if you save the family, you build a stronger society and a better economy.

Turning to the G20, this is now the right forum for all the leading economies of the world to discuss the vital economic issues. The key goal of the G20 is to continue the recovery of the world economy and secure sustainable growth. The argument, proposed by some, that deficit reduction and growth are mutually exclusive is completely wrong. The whole approach underlined by the IMF for this G20 and the subsequent meeting in Seoul is all about how the world should maximise growth through the right combination of three things: deficit reduction, tackling imbalances, particularly through actions by emerging economies, and structural reform in the advanced economies. There was broad agreement on all three and this is reflected clearly in the communiqué.

On deficit reduction, the G20 agreed:

“Those countries with serious fiscal challenges need to accelerate the pace of consolidation”,

and that there was,

“a risk that failure to implement consolidation … would undermine confidence and hamper growth”.

The advanced G20 economies committed to at least halve current deficits by 2013 and stabilise government debt to GDP ratios by 2016. While we agreed that the speed and timing of deficit reduction will vary with national circumstances, the verdict of the G20 was unequivocal.

For countries with large deficits, the time to act is now. Britain has one of the largest deficits in the G20, and the summit specifically welcomed the plans set out in our Budget last week. In terms of addressing the fundamental imbalances, China’s recent decision to move towards greater exchange rate flexibility is welcome. As, in the end, growth comes only from rising productivity, we also agreed on the need to pursue structural reform across the whole G20 to increase and sustain our growth prospects.

On financial reform, the G20 agreed ‘a set of principles’ on bank levies to ensure that the financial sector makes a,

‘fair and substantial contribution towards paying for any burdens associated with government interventions to repair the financial system’.

That is very much in line with the plans for a bank levy, which we announced in the Budget. On making sure that the banks in all countries can withstand future crises, we also agreed that,

‘the amount of capital will be significantly higher and the quality of capital significantly improved’.

We agreed that new standards on the quality, quantity and transparency of capital and liquidity should be finalised by the Seoul summit in November.

Basle took 10 years and this looks like it will be completed in one. Although the drawing up of clear, robust new rules is absolutely essential, it is important that they are not implemented too quickly. We do not want a further monetary squeeze or a reduction in bank lending at this stage of the recovery. The biggest stimulus we could give to the world economy today is the expansion of trade. Although the G20 agreement to extend its pledge that no additional trade barriers should be put in place is welcome, continued failure to make progress on Doha is deeply disappointing. This has now been eight years in negotiation and there can be little confidence that, as things stand, the round will be completed rapidly.

A completed trade round could add $170 billion to the world economy. The UK led the working session on this issue at the G20. One potential way of making progress is to try to add to the benefits of the round so that all parties can see reasons for going that final mile. That was supported by President Obama. The director-general of the World Trade Organisation, Pascal Lamy, suggested that all trade negotiators should return to the table and consider both what it is they really need from the round and what it is they are prepared to offer to get it moving again. That will lead to a report at the Seoul meeting in November.

Too many people still see this as a zero sum game, where one country's success in exports is another country's failure. That is nonsense. Everyone can benefit from an increase in trade flows. We will play our part in breaking the logjam. I want this country to lead the charge in making the case for growing trade flows around the world.

On climate change, while the G8 communiqué was strongly positive on limiting the rise in global temperatures to less than two degrees and on seeking an ambitious and binding post-2012 agreement, at the G20, the communiqué was more limited. This is partly because some countries do not see the G20 as the forum for discussing this issue. In discussions, it was also clear that there was widespread disappointment at the way that Copenhagen failed to deliver a legally binding global deal. We must not give up on this. We will be playing our full part in pushing for a successful outcome at Cancun.

This long weekend of summitry was a good opportunity to build Britain's bilateral relationships. Among others, I had useful meetings with President Obama, President Hu of China, Prime Minister Singh of India and Prime Minister Erdogan of Turkey. In building a very strong friendship with our leading European partners, I also suffered the exquisite agony of watching England lose 4-1 to Germany in the company of my good friend Chancellor Merkel and the German summit team. Although I cannot recommend the experience of watching football in the margins of a G20 summit, I commend this Statement to the House”.

--- Later in debate ---

[Lord Strathclyde]

My Lords, I was going to say how grateful I was that the noble Lord, Lord Eatwell, was standing in for the leader of the Opposition. Having heard his speech, I am not sure that that is the case. He asked a series of extremely pertinent questions that, if this were a full debate of several hours, would take me tens of minutes to reply to. I hope that he will forgive me if on some of his specific questions I answer him by way of a letter. As I know that others in the House will take what the noble Lord said seriously and with great interest, I will make sure that a copy of the letter is put in the Library.

The noble Lord, Lord Eatwell, started off with an important question about the statement by my right honourable friend the Prime Minister on Afghanistan, the so-called five-year limit and whether any discussions took place with our allies. We are in a state of continual consultation with our allies in Afghanistan. None of that statement was a surprise to them. They understood exactly the point that we were making. There is no desire in any country for its forces to remain in Afghanistan for any longer than they absolutely have to. Over the past few weeks, we have laid out a set of priorities that we believe will enable British forces to have largely removed from Afghanistan, as part of getting civil society in Afghanistan working again.

We have set ourselves new priorities on the aim of development aid. It is right that we and the G8 should do so. It is important continually to review our processes and priorities for our development goals, and the new priorities on the health of mothers, children and families speak for themselves. However, a unity of purpose does not mean a unity of means. Although it is true that Britain has maintained its commitment on funding overseas aid, other countries have found it more difficult. However, in the medium term, there is no reason why we should not get back to the original position. We do not anticipate new money coming in to deal with those priorities. It will be a change of priorities within the existing budget but, as we have explained, over time we hope to meet our target of 0.7 per cent of GDP.

On bank levies and the financial situation, as the noble Lord knows only too well, the IMF forecasts that the UK will in 2010-11 have the largest budget deficit in the G7. When he talked about the record of the former Chancellor of the Exchequer, I was not quite sure whether he took pride in the legacy that the Labour Party left this country. We must never lose sight of the lesson of the past three years: taxpayers pick up the bill not only when one of our banks fails but when Governments spend too much money. The bank levy, the concentration of risks and higher capital requirements will all be debated and discussed as quickly as possible over the next few months. There is no question of the new bank rules being imposed. They will need to be agreed by all, and we believe that there is every possibility of those new rules being agreed by everybody.

The noble Lord poked fun at my coalition colleagues, which was entirely unnecessary. I can confirm to him that we are getting along extremely well. Sometimes people say that we have a lot to learn from our European colleagues. I hope that when it comes to working with coalition colleagues, they will find that they have a lot to learn from us.

[Lord Laming]

My Lords, I am sure that the whole House will support the warm tributes that the Leader of the House and others have paid to our brave military personnel. Does he accept that many of us welcome the Prime Minister’s decision to get our troops out of Afghanistan at the earliest practicable time? Does he also accept that, if that requires involving the Taliban in negotiations, that is a nettle that will need to be grasped?

[Lord Strathclyde]

I thank the noble Lord, Lord Laming, for what he has just said. He reiterates the position extremely well and with a clear understanding of what the issues are. There is increasingly an appreciation and understanding that a violent and military-directed war in Afghanistan is not a winnable proposition for anybody, least of all for the people of Afghanistan themselves. All peace processes around the world have dealt with it by, slowly but surely, bringing all sides together. That will need to be the case in Afghanistan and is increasingly the thrust of our policy.

[Lord Dholakia]

My Lords, may we from this side join the noble Lord in the tributes that he paid to the seven soldiers who lost their lives last week?

One matter of concern is the non-action on development aid, particularly the lack of action on the targets for alleviating poverty. How do the Government plan to ensure that the decisions taken by the G8 and the G20 will be actively implemented? Furthermore, why was climate change discussed only in the G8? If there is to be a global agreement on the way forward on climate change, surely the non-G8 members of the G20 will have to play a crucial role. Finally, do the Government agree that the G8 has now become an anachronism and that it would be better if its role was assumed completely by the G20?

[Lord Strathclyde]

My noble friend is right to draw attention to development aid, a matter which very much dominated the discussions of the G8. That delivered for the first time a comprehensive accountability report which assessed transparently the G8 progress against its development-related commitments. In the communiqué the G8 leaders reaffirmed their commitments on overseas development aid, on aid effectiveness and on HIV/AIDS. Furthermore, however cynical one is—and I am not suggesting for a moment that my noble friend is cynical when it comes to these matters—about a very serious attempt to give a new priority to these initiatives, the House will recognise that there was an agreement in the Muskoka initiative which means that funding for maternal, newborn and child health will be the new priority.

On the question of climate change, I can understand why my noble friend should feel aggrieved that this could be debated and discussed with one group but less successfully with another. However, there are those at the G20 who felt that it was not appropriate for it to be discussed at that level and that it should remain with the G8. However, there is the climate change conference in Cancun later this year. An enormous amount of work is taking place between now and then to give effect to a global agreement.

[Lord Howarth of Newport]

My Lords, on global imbalances, the Statement referred only to the modest, although welcome, adjustment that the Chinese authorities have allowed to the exchange rate of the renminbi, but surely the Government do not think that that will be enough to solve adequately the problem that is being generated by the continuing propensity of certain major economies, notably China and Germany, to invest and export very powerfully, and the propensity of other major economies, notably that of the United States of America and our own, to borrow and consume excessively. Is it not inevitable that if we continue with these imbalances, the trade surpluses of the exporting countries will be recycled to create excessive liquidity in the economies of countries such as our own that tend to consume too much, leading to another manic and unsustainable boom followed by a miserable bust? What were the Prime Minister’s suggestions at the G20 for averting this outcome, and what response did he receive?

[Lord Strathclyde]

I could not possibly comment on the noble Lord’s direct question at the end, but the whole issue of global imbalances concentrated the minds of the G8, and indeed of the G20. The new flexibility in the Chinese arrangements is an important step in the right direction. It is the kind of flexibility that we have been looking for for some time, it will make an appreciable difference—so we all hope—and it is recognition by the Chinese authorities of China’s importance to the world economy as a trading nation and as an increasingly important currency. The noble Lord might say that this is a very small step, but it is at least a small step in the right direction.

[Lord Hannay of Chiswick]

My Lords, does the Minister accept that the case for maintaining the G8 while the G20 is functioning is rather less strong than the Statement that he read out suggests? Here, I join the noble Lord, Lord Dholakia. Only by stretching the word “democratic” a very long way indeed can it be applied to the G8, which has Russia among its members. It is also surely worth remembering that there are rather better qualified democracies in the G20, such as India, Brazil and South Africa, the membership of at least some of which we support as permanent members of the Security Council. I therefore hope that the Government will reflect a little on the need for these two forums to continue to run side by side and confusing the issues that they discuss quite a lot—a confusion that I suspect will increase when they meet in different places, as presumably they will have to when the G20 goes to Mexico in 2012, as is said in the communiqué. I therefore hope that the Government will reflect on the possibility of a sunset clause for the G8.

Will the Minister also be so kind as to comment on what the Government are doing to ensure that these endlessly repeated commitments to complete the Doha round are brought to a decision in the not too distant future? The wording of the communiqué is extremely weak. I thought that the wording of the Statement was first class, if I may say so. It reflects the view of those on all sides in this House and in this country that this is a really major objective. However, there is no sign whatever that the United States Administration are putting their back into completing Doha. What strategy do the Government have for moving that ahead at Seoul and thereafter?

[Lord Strathclyde]

My Lords, my right honourable friend found the meetings at the G8 and the G20 useful. They were particularly useful because they were different, and because, as a new Prime Minister, he was able to meet different political leaders at different stages. It is impossible for me to say whether these structures will be maintained in the long term. As the noble Lord recognised, they will not be meeting together in the future.

On the Doha round, the noble Lord, Lord Hannay, said that he finds the Statement convincing but the communiqué rather less so. Frankly, we were rather disappointed by the wording in the communiqué. It is a key strategic plank of this Government to move issues forward on the whole question of the Doha trade round and we will be developing a strategy so that we turn that leadership into action by convincing different countries that it is in their material interest to see an increase in global trade. I am sure the whole House agrees with that but it will need our combined collective will, good judgment and the kind of experience that the noble Lord, Lord Hannay, possesses in order to convince other countries of that necessity.

[Baroness Symons of Vernham Dean]

My Lords, first, can the noble Lord shed a little more light on the Prime Minister’s thinking on withdrawing our troops from Afghanistan by 2015? It was always the view in the past, as I understood it, that giving a date for withdrawal would be like signalling to the Taliban and al-Qaeda how long they would have to hold out before they would not have any opposition on the ground. My concern is that many people will think that this gives the Taliban and al-Qaeda an opportunity to scale down what they are doing, gather their resources and armaments, bring in fresh recruits and simply re-emerge when the foreign troops have departed. I wonder if the noble Lord can help me on that.

Secondly, the Statement says that the biggest stimulus that we can give the world economy today is the expansion of trade. Can the noble Lord tell us when the Government are planning to appoint a Minister dedicated to trade promotion? I know that, among his many other duties, Mr Mark Prisk has been appointed pro tem to look at trade—but the fact is that he has many other duties. Previously, the noble Lord, Lord Digby Jones, my noble friend Lord Mervyn Davies, and indeed I myself were dedicated to trade promotion and expansion. When will the Government be able to match what they are encouraging the world to do by doing a little better at home?

[Lord Strathclyde]

My Lords, on the point about Afghanistan, I agree that the view was taken in the past that making too rigid a timetable and setting the end date too soon simply gives a target for everyone to aim at. That is not true in this case because we are in a very different situation. We have been in Afghanistan for about nine years now and we can see that this current year is extremely important in creating the right grounds for long-term peace and rebuilding civil society. In this case, I do not think that we will run into the danger of giving the Taliban a target, and after all, five years is a long time to have to hang around waiting for British troops to leave. Moreover, that would not achieve the right conditions on the ground for rebuilding civil society in Afghanistan, which is important. So while I accept the point made by the noble Baroness, it is my wish, as I know it is hers, that those conditions will not apply.

On the question of the Minister for Trade, I could not agree more with the noble Baroness that such a Minister is important and that—by her own example and that of others in this House who have held the role—it is a key role for the Government and for focusing our overseas export effort. I am delighted to say that in the past 24 hours Mr Mark Prisk has been made the Minister of Trade. I know that, aided and helped in every way by my noble friend Lord Howell of Guildford, they will make a valuable team. Moreover, my noble friend will be answering for him in this House.

[Lord Lawson of Blaby]

My Lords, is not the answer to the question posed by the noble Lord, Lord Dholakia—who, having asked his question, appears no longer to be in his place—that the G20 was unwilling to tackle the question of climate change because the major developing nations such as China, India and, to a certain extent, South Africa and Brazil quite rightly attach much greater importance to economic development and the relief of poverty, to which moves on climate change would be entirely antipathetic? Nevertheless, does my noble friend agree that there is reason to welcome the response by that distinguished economist, the noble Lord, Lord Eatwell, speaking on behalf of the Official Opposition? Although he devoted his comments largely to the minutiae of banking reform—which are important but not urgent matters; indeed, it is more important to get this right than to do it quickly—he accepted, tacitly at any rate, the urgent need for the fiscal consolidation which this Government have shown they have the courage to enter into despite some of the rumblings from the neo-Keynesian dinosaurs who appear to be around.

[Lord Strathclyde]

My Lords, I am sure that the noble Lord, Lord Eatwell, enjoyed that in the spirit in which it was intended. I agree with my noble friend that fiscal consolidation is important. Not only have we struck the right balance but, increasingly around the world, it is seen that we have struck the right balance. On the question of the G20 and the G8, my noble friend is again correct. Different countries have taken different views of these issues, particularly the developing countries. That is not news today but has been true for some time. That is why the climate change conference in Cancun will be extremely important.

[Lord Patel]

My Lords, I commend the Government on their commitment to increasing overseas aid to 0.7 per cent of GDP, as I do their renewed commitment to reducing the terrible tragedy of maternal mortality. Does the Leader of the House agree that in any new strategy which the Government might develop for reducing maternal mortality, our professional organisations will be well placed to assist in the health service reforms required? Secondly, while a reduction in maternal mortality is important, we must also not forget that we need to reduce the terrible burden of other reproductive health issues, such as the greater number of deaths—even more than through maternal mortality—that occur through cervical cancer in low-resource countries, which is a totally preventable disease; the problem of fistulas; and the number of children dying in childbirth or immediately after, which is now some 3 million.

[Lord Strathclyde]

My Lords, the noble Lord, Lord Patel, rightly draws us back to the issue of overseas aid. The reasons for changing the priorities of the G8 were not taken lightly. Obviously, in putting this new strategy into effect, there will be wide consultation with involved parties—most importantly with the health authorities of the countries most directly involved—so that the resources spent can be used as effectively and efficiently as possible. The noble Lord is also correct to refer to the range of preventable diseases that exist and which at the moment are not dealt with sufficiently well. This issue is part of an overall programme. I do not suppose we will see all the answers come out quickly, but the direction of travel is important.

[Lord Bates]

My Lords, I welcome my noble friend repeating the Statement, particularly the strong section relating to development aid. Can he confirm reports that there was a shortfall of some $10 billion in the commitment of $50 billion made at the Gleneagles G8 summit five years ago? Can he further confirm that the two countries primarily responsible for that are Japan and Italy? What conversations did my right honourable friend the Prime Minister have with them on that issue? Given that they have cited their fiscal position as the reason for not fulfilling their commitment, will my noble friend encourage the Prime Minister to give them a lesson on how to rigorously tackle the fiscal deficit while still being fair and caring about the world’s poorest?

[Lord Strathclyde]

My Lords, there are many people who will be disappointed that some of the Gleneagles aims have not been met. My noble friend referred to two of those countries. In the communiqué that was delivered this weekend, there was genuine recognition that there needs to be more transparency and accountability on the part of those countries that have promised to help but have not yet delivered.

I know that the Prime Minister draws the attention of many people, not only from overseas, to the problems that we face in this country and how we are tackling them. They may well be a beacon of light to help other countries meet the commitments that they have already made and come up with the money.