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Mr. Berry: Will the hon. Gentleman please tell the House the source of those statistics, which come as a surprise to some of us?

Mr. Key: Yes, they come from a number of academics and the Defence Manufacturers Association. [Hon. Members: "Ah."] It is all very well for hon. Members to say, "Ah", but government is not just about listening to only one argument; all the arguments have to be listened to, which is precisely what we have done.

The Government are now floundering in a mess of their own making when it comes to sustainable development. They have listened and acted on concerns about the application of criterion 8 across Departments. We are concerned that, on reflection, the amendment goes much further than Lord Scott intended, so we will not seek to frustrate the Government's will in this matter.

Mr. Berry: I should like to express my gratitude to my hon. Friend the Minister for arranging a meeting with himself and officials after the debates on Report. A number of my colleagues and I had the opportunity to discuss sustainable development with him and how it might be dealt with in the Bill. I should like to thank him, first and foremost, for that opportunity. This is indeed an historic Bill, and I passionately support 99 per cent. of it. I also congratulate the Minister and his colleagues on ensuring that sustainable development has been included in the Bill. That is very welcome indeed. However, I confess to being at a total loss as to why the Government have tabled amendment (a) to Lords Amendment No. 17, and I shall explain why very simply.

Lords Amendment No. 17 is very clear. It states:

The Government want to remove that and to replace it with the words:

to issues that relate to sustainable development. I have two problems with that, and I am clearly not in a minority of hon. Members in having that view. The first problem is that, pretty obviously, "to have regard to", as in Lords Amendment No. 17, constitutes a stronger obligation than the duty "to give consideration to", as in Government amendment (a).

At first blush, there seems to be an open and closed case that the Government are weakening the duty. However, the second and perhaps even greater problem is the inclusion of the phrase "if any", so a future Secretary of State could simply ignore sustainable development when issuing guidance on export licensing by the simple device that he or she would be required only to include

May I please emphasise that I do not suggest that the current Secretary of State would do that? I might be in enough trouble in a minute, so I shall not dig myself into that one as well, but a future Secretary of State could say, "No, I do not think that consideration should be given". It is clear from what my hon. Friend the Minister has said

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this afternoon that the Government do not want that to happen, but I simply do not understand why the Government want to include amendment (a).

My hon. Friend suggested that the Lords amendment would fetter the Government's ability to make common-sense decisions—I think that that was the phrase that he used. I am all in favour of common sense, but I do not understand which common-sense decisions would be problematic. The example given by the Minister, which happened to be the same example given by Lord Sainsbury in another place, was the export of a single military vehicle to a developed country such as the United States of America. Clearly, as has been pointed out, that would not raise sustainable development issues.

5.15 pm

As I understand it, therefore, the Government's concern, expressed by hon. Friend the Minister today and by his colleagues in the other place, seems to be that a range of decisions in relation to particular exports to particular countries would not be especially affected by the sustainable development criterion. That is why they wanted the phrase "if any" to be included. For the life of me, I do not understand why the Secretary of State cannot issue appropriate guidance on the sustainable development criterion indicating, for example, what exports to which sorts of countries would be considered. I assume that that is part and parcel of guidance. Nobody has ever argued that every good and service exported by the UK to every country in the world should be subject to an appraisal before an export licence is granted. Guidance is there to assist those making decisions to ensure that the Government's policy on arms export controls and other matters is implemented. The Lords amendment, which, in my view, is better than the Government amendment, would prevent sustainable development from not being considered when it is, in fact, relevant.

My hon. Friend said that the Government have had legal advice. He will know, as we all do, that Oxfam has also had legal advice from Matrix chambers. As this is a brief debate, I shall not waste the time of the House by quoting that advice, but it is contrary to what my hon. Friend has said and says that the Lords amendment is less unclear and stronger than the Government amendment, and that the problem that my hon. Friend has identified could be dealt with in the guidance issued by the Secretary of State. I am therefore at a loss to know the real reason why the Government want to amend Lords amendment No. 17.

I want to make a couple of brief points about guidance on sustainable development, as that is relevant to what will be the work of those responsible once this welcome Bill becomes an Act. I was delighted that, in March, my right hon. Friend the Foreign Secretary informed the Quadripartite Committee that the Cabinet Office is undertaking an exercise with relevant Departments in assessing criterion 8. I welcome the review of criterion 8, and I hope that it will address a couple of issues.

First, if one considers the consolidated criteria, they do not carry the same weight. The first four criteria take the form that

For example, a licence will not be issued

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The first four of the eight criteria state that the Government will not grant a licence if certain conditions are satisfied—for example, if it is incompatible with our international obligations, or if exports would

A current example of that springs to mind.

My point is that the principle of the first four criteria is that the Government will not grant a licence if a certain condition is satisfied, whereas the principle behind the sustainable development criterion—I am glad that it is being reviewed—is that the Government will "take into account" the effects. I hope that that duty will be considered further in the review that is being undertaken. It is slightly odd that the sustainable development criterion is of a different order of importance than the first four of the eight.

My hon. Friend the Member for City of York (Hugh Bayley) made the point that any realistic and productive assessment of the sustainable development criterion must involve assessing the extent to which arms exports represent value for money or productive expenditure. I shall say nothing about the Tanzanian controversy, but it obviously springs to mind. I want to stress that, as my hon. Friend rightly pointed out, in the case of the Export Credits Guarantee Department, the Government have already accepted the principle of a productive expenditure test. The ECGD's statement of business principles makes it perfectly clear that support for exports to developing countries must be given only when they will not harm sustainable development.

I spent a few happy moments this morning looking at the ECGD's website. Its business principles include:

The wording gets stronger. The statement adds:

It specifically makes it clear:

That is already Government policy in terms of what the ECGD does.

We should apply that same principle to arms exports. We should use the review of criterion 8 to raise the standards for sustainable development testing to those used by the ECGD. If we do not do that, Government policy on sustainable development will not remain joined up. For example, it would be ludicrous if the Government refused export credit guarantees because the productive expenditure tests had not been met at the same time as they granted a licence for arms exports. A key part of the review of criterion 8 is that it must be used to make the policies consistent. ECGD practice demonstrates that it is right in principle and possible in practice to test for the sustainable development impact when deciding whether to license arms exports. To support that argument, I point to the fact that the Government already do that.

I acknowledge that the Government have moved on the provision for sustainable development. When we debated the issue on Report, we were told that we did not need

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such a provision in the Bill because the matter was being dealt with through the criteria. At the meeting I had with the Minister, we were told that we could not put such a provision in the Bill because it would apply to every good that the country exported. We are now being told a third story—we can have such a provision in the Bill, but that the Government do not like the Lords amendment. I am not trying to be difficult and I certainly am not trying to be sarcastic, but I genuinely do not understand why the Government should want to amend the two sensible lines in the Lords amendment.

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