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Nigel Griffiths: Can the hon. Gentleman confirm whether the arms manufacturers asked for such a provision to be put in the Bill?

Mr. Whittingdale: I do not believe that the arms manufacturers have made such a request, but it is the

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House, rather than the arms manufacturers, that wishes to determine the contents of the Bill. There are serious concerns that need to be addressed.

The Minister has claimed throughout our proceedings this afternoon that sustainable development is a criterion by which export licences can be judged, as set out in the EU code of conduct. He argued that it is therefore unnecessary to specify sustainable development as a criterion in the schedule to the Bill. However, he has plainly failed to explain why, if it is possible to use the criterion contained in the EU code of conduct, it cannot also be contained in the schedule. His explanations on that point have been profoundly unconvincing. For that reason, we supported amendment No. 39.

The Bill will have a considerable impact on a key sector of British industry. Not only is the United Kingdom's the fourth largest economy in the world, but we remain a major international manufacturing and trading nation, and our defence manufacturing industry is second only to that of the United States of America. It employs some 350,000 people and there can hardly be a single hon. Member whose constituency does not contain some defence- related businesses.

In my constituency, that is certainly the case. We have the BAE Systems research centre at Great Baddow, and just eight weeks ago I was the guest of Alenia Marconi at the Defence Systems and Equipment International, or DSEi, exhibition at the Excel centre in Docklands. The hon. Member for Moray (Angus Robertson) mentioned that exhibition and raised some questions about the people who had been invited to attend it. However, the exhibition was a fantastic showcase of British defence manufacturers and left one in no doubt about their importance to the economy.

These are difficult times for all involved in business, and manufacturing in particular. The manufacturing sector has been in recession since the beginning of the year and the latest figures show another significant drop in output. It is therefore essential that the Government should not add to the burden of regulation and bureaucracy any more than is necessary. The Government do not have a very good record on that, and defence firms are right to worry that the Bill might make it harder still for them to compete.

My hon. Friend the Member for Salisbury rightly pressed the Government with his amendment to include in the Bill a requirement that licence applications be determined within a specific period. I regret that the Government were not persuaded by his argument, although I draw some comfort from the assurances that the Minister gave. There is still concern that the Bill may make it even harder for Department of Trade and Industry officials to determine applications within a reasonable time, and that that might add a further impediment to the competitiveness of defence manufacturers.

The Government's task has been to strike a delicate balance between the need to exert proper control over the export of goods and related technology and the need not to inhibit legitimate trade unnecessarily by imposing unrealistic or burdensome regulation. How successful they have been in that task will be very difficult to tell until we have seen the detail of the secondary legislation. We shall, however, support the Bill on Third Reading, while continuing to raise these issues. I suspect that they will be

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the feature of debate in another place and perhaps here, too, when the secondary legislation comes back before the House.

6.36 pm

Mr. O'Neill: I listened with ever-increasing incredulity to the hon. Member for Maldon and East Chelmsford (Mr. Whittingdale). When he was carrying the bags of the then Prime Minister, I remember trying to elicit information from the then Conservative Government about issues such as Iraqi guns, and getting either a wall of silence or a cackle of deceit. We got no information; we had virtually no means of getting to the bottom of those matters.

I have been mildly critical of the Bill today. There have been pieces of legislation from which one derives particular satisfaction, and the legislation on the national minimum wage is an example. I take pride in this Bill because I realise that much of the campaigning and arguing that we did in the late 1980s and early 1990s is now bearing fruit; indeed, it has borne fruit.

There are some grounds for complaint about the tardiness with which the Bill was produced. Nevertheless, reports have been produced and improved on year on year, largely as a consequence of the Quadripartite Committee's criticisms. The reports started out with an unacceptable degree of opacity in their writing and presentation, and it was thanks to the Clerk of the Committee and some of its members—Ted Rowlands, its then Chairman, in particular—that the publications were put into an intelligible form. The importance of doing that was that the argument can no longer be levelled against us that we should not restrict trade in armaments because if we do not carry on that trade, someone else will because there is no leverage in the international arena. We now have that leverage.

I am always reluctant to place any Government on the high moral ground, but we now have a position from which to argue internationally in favour of a better control regime for armaments. That means that we can give the lie to the argument, hinted at by the hon. Member for Maldon and East Chelmsford, that we are somehow going to disadvantage our armaments industry. Armaments industries always complain, and they always will.

We now have a means whereby we can show a proper way of dealing with the arms business, which I believe is a legitimate part of economic activity. It reduces the cost base and the unit cost of our own equipment and is an important employer and trainer of labour. I know from my experience in the east of Scotland that the armaments industry was the engine that drove what became known as silicon glen and the high-tech civilian industries.

I welcome the Bill and I hope that it may be tweaked a bit in the Lords. Every Opposition complain about negative resolutions. I spent years labouring in the Augean stables of the Standing Committees, looking for references to negative procedures so that we could have a debate on them. That kept the Committees going. Sometimes that took us half the night—but my point is that, by and large, the Bill marks a major step forward in our handling of the armaments industry. It can be held up as an example to the rest of the world. It is not often that we can do that in Britain, and for that reason alone—apart

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from all the other desirable elements—I wish the Bill well elsewhere. I hope that eventually we shall secure a degree of prior scrutiny, but at this stage I am happy for the best not to be the enemy of the good.

6.40 pm

Dr. Tonge: I well remember, as a very new Member, sitting in the Locarno rooms in the Foreign Office and listening to that speech about foreign policy with an ethical dimension. I do not think there was a dry eye in the house that morning: it was tremendously moving and very exciting to feel that we were part of a new Government with a new slant—a new ethical dimension.

We waited excitedly for tangible proof of the new direction that we had taken. We waited, and we waited. In my office, we waited particularly for a Bill to follow up the Scott report—a Bill on arms control. We waited four years. When the draft Bill was published, a cheer went up from the young people who worked in the office, and from me. We were delighted; it was extremely welcome. The hon. Member for Ochil (Mr. O'Neill) is right. This Bill is welcome, and in many ways it is a very good Bill. We will, of course, support it.

In these closing stages, we should pay tribute to a couple of bodies. I am thinking of non-governmental organisations such as the UK Working Group on Arms, and Saferworld, which have done a tremendous job in supporting and briefing Members. Some of the issues have been very difficult, and I think that their good work should be recorded publicly. I also pay tribute to the Quadripartite Committee, which has been brilliant, and to its Chairman. I was sad to be a member of it for such a short time; its work and its report have been exemplary. I do not understand why the Government cannot accept the concept of prior scrutiny. A Committee like the Quadripartite Committee would be entirely responsible, and would surely respect the needs of the arms industry. It would weigh up those needs, and balance them against all the other needs that it had to consider.

I am still concerned about brokering. I am still not convinced that the Bill would prevent a man with a mobile telephone from selling arms wherever he wanted to. We have been given all sorts of assurances, but I hope the matter will be considered again in the other place. My main concern, however, still relates to the cumulative effect of arms exports on developing countries. Linked with that, of course, is our favourite topic this week, sustainable development. We have heard well-argued speeches on the subject today and yesterday, when we debated the International Development Bill. I feel that the Minister's responses today have been pathetic—he seems constantly to fall back on the European code of conduct, which he apparently considers to be legally binding. We all know that it is not.

Let me read the Minister a short extract from the report of the Committee stage. It is very short; do not despair. I said:

Members may remember the incident. I continued:

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In replying, the Minister said:

That is all very fine, but a couple of months before the code of conduct had already been broken and nothing happened, so it is not very reassuring constantly to fall back on that code.

Sadly, although it is welcome, it is a curate's egg of a Bill. I hope that it will be further improved in the other place.

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