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Lord Renton of Mount Harry: My Lords, I thank the noble Baroness for giving way. She made the point that the settlement received reverses the fall of 8.5 per cent. over the three previous years. It does not. It accepts the fall but then starts to build back again at a rate of approximately 1 per cent. a year. That fall, which I regret, is now a fact and that must be understood. It is not reversed. One of the difficulties is that one is building now on a smaller financial base in grant in aid.

Baroness Symons of Vernham Dean: My Lords, the fact is that the process is being reversed. This Government demonstrate their real commitment to the British Council not only by meeting inflation, but by building upon that in real terms. We were very pleased to be able to give a real increase of some 1.5 per cent. I say gently to the noble Lord opposite and to the noble Lord, Lord Moynihan, that they failed lamentably to do the right thing on funding when their party was in office. They now demonstrate an enthusiasm for funding that they did not demonstrate when their party was in office. This party is doing the right thing.

In July of last year my noble friend Lady Kennedy took over the chair of the British Council. Under her energetic direction the British Council completed a fundamental review of its purpose under which a revised strategy was adopted aimed at focusing the Council's work on a single clear purpose, that purpose being to enhance the reputation of the UK in the world as a valued partner. The results of the review have been endorsed by the Foreign and Commonwealth Office, and we welcome the new drive and momentum that my noble friend has brought to the Council. We warmly welcome her to her new role as many other noble Lords have done. It is important however to note that although the Council's core funding comes from government, the proportion of total income from government grant has declined steadily. Under one third of the Council's income now comes from government. The rest comes from English teaching, running British examinations,

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administering training programmes and managing development contracts. All of these activities enhance Britain's presence overseas at no cost to the British taxpayer.

Many noble Lords have referred to a wide range of activities in which the Council is involved. I should like to deal with some of them. I begin with human rights to which I referred a moment or two ago. In the promotion of human rights, civil liberties and democracy the Council has responded through a number of innovative programmes, some funded through the FCO's Human Rights Project Fund. The Council is involved in managing over half of the projects under this fund. One of the most notable is the Palestinian Rights Programme which includes a project on the development of a children's charter of rights. The noble Baroness, Lady Fookes, raised the question of women. The British Council has been involved in work to support the status of women and their participation in the political, social and economic life of their society as instanced by the four-year project on political skills for women running for local government in Nigeria; in judicial and legal training through its Indian young lawyers scheme and practical training schemes for young Chinese lawyers; and in ethnicity where it is publishing a magazine in Zimbabwe with accounts by visiting professionals about being black in Britain. Those are just a few examples of the work of the Council in the important areas of equality and human rights.

Several noble Lords, particularly the noble Lords, Lord Dearing and Lord Moynihan, made reference to the very important role played by the British Council in overseas student recruitment. Over 200,000 students are currently enrolled in British higher education. Of those, approximately half come from the 14 countries where the Council operates its education counselling service. Independent estimates of the value of overseas student business to our economy are put at £1.5 billion. The education counselling service co-financed by the Council and British academic institutions is an excellent example of partnership in action. Partnership and collaboration are the basis of the Council's work in this and many other areas of work.

The British Council in 1998 helpfully agreed to administer our new, one-year scholarship scheme, designed to help students from Indonesia, Korea Malaysia and Thailand studying, or planning to study, in the United Kingdom in 1998 and to overcome the financial problems they face as a result of the significant currency fluctuations in their countries. Principally financed by the FCO, the private sector and British universities and colleges, but with contributions also from the British Council and the DTI, the British scholarship scheme has generated much goodwill towards the United Kingdom in the countries concerned. Some 2,800 students have benefited from the scheme and it has received particularly warm support from business co-sponsors.

The noble Lord, Lord Moynihan, reminded us that the Council also manages on a long-term basis the prestigious Chevening Scholarships funded by the Foreign Office and the DfID. These scholarships enable future leaders, decision-makers and opinion formers

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from around the world to study in the United Kingdom at a formative stage in their careers. In doing so, they develop an understanding of British values, institutions and our way of life. On returning home they make important contributions to the development of their own societies. For ourselves, having friends of Britain in high places overseas helps to further our long-term political, commercial and developmental interests.

The Council also helps with the administration of a range of co-sponsored schemes including the very successful John Smith Fellowship Programme initiated by my noble friend Baroness Smith in honour of the late leader of the Labour Party. I am grateful to my noble friend, as I am sure is my noble friend Lady Kennedy, for her very appreciative words this evening. I entirely agree with noble Lords that the importance of attracting more foreign students to the United Kingdom cannot be too strongly emphasised. I believe that that point was made very well by the noble Lord, Lord Dearing. A cross-Whitehall study has just been undertaken on exactly how we should do this. Its genesis was a visit from the Prime Minister to China where he was struck by the value and effectiveness of British scholarship schemes. The British Council will be a natural partner in the implementation of any recommendations that result from that study.

Many noble Lords, but particularly the noble Lord, Lord Chorley, drew our attention to English language training. Undoubtedly the English language is one of our major assets. The UK is the leading international provider of English language teaching and services. The Council's own teaching network of 127 centres in 54 countries stands as a bench-mark of quality and best practice, with over 1.1 million class hours taught worldwide every year. But the Council is equally concerned to help other countries develop English teaching in their schools and other institutions. Ideally we should like all those who need or want it to have access to English, the language which best opens windows in the modern world. It also opens windows to our traditional and contemporary literature so vividly described by my noble friend Lady Rendell.

Several noble Lords referred to the work and expertise of the British Council in promoting Britain's achievements in the arts, literature and design which attract plaudits from all over the world. Over the past year it has provided a major input to a number of events organised by FCO missions overseas to promote the UK, such as Festival UK98 in Japan and UKaccents, a year-long festival in Ottawa aimed exclusively at young people which includes leading examples of British youth culture, with DJs, fashion designers, performance artists and film-makers. Rarely can a Council venture have had such a spectacular outcome as David Hare's brilliant play "Via Dolorosa" written after a Council-sponsored visit to Israel and the occupied territories.

The Council also helps to promote British exports in the fields of education and training and the creative industries through overseas missions, seminars, fairs and showcases, together with exhibitions of visual work as the noble Lord, Freyberg, reminded us. Together these sectors account for some £15 billion of exports. The Council has been actively involved in the recent drive

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to develop and promote our booming creative industries where it is working with the FCO, DCMS, DTI and some 40 trade associations in the sector to develop fresh export promotion initiatives. The Council's renowned skills and expertise as Britain's principal agency for cultural affairs makes it the natural choice to organise events in this very important field.

Perhaps I may refer to the Council's work in developing countries. The fact that the British Council now receives a single grant-in-aid from the Foreign Office does not mean that it has given up its long-standing interest in working in and with developing countries. It will continue to run substantial programmes in developing countries, in particular in the field of libraries and information, education and the English language and the encouragement of better practice in the field of governance and human rights. The Council's approach, based on partnership and mutual interest, helps to further the values which we believe support fruitful co-operation with developing countries. I took very much to heart the points made by the noble Earl on the way in which the Council should be working on the ground with NGOs.

Some attention has been focused on the recent downturn in the value of DfID contracts awarded to the British Council. Both the DfID and the British Council have undertaken statistical analysis of the downturn. The DfID analysis shows clearly that there has been a substantial reduction in the overall value of contracts. But not all British Council business obtained from the DfID is in the education sector. The picture is complex. There are variations from one overseas country to another reflecting different factors.

The Council is understandably concerned to build up a picture of future prospects as soon as possible. The DfID is very ready to provide information on its planned approaches under individual bilateral country programmes and to talk through the likely opportunities with the British Council and others. Like others, the Council will no doubt want to keep in contact with the DfID. I understand that the British Council had a helpful meeting with my right honourable friend the Secretary of State for the DfID yesterday. I hope that by those kinds of contact we shall be able to inform the Council of the way in which matters are developing.

I wish to comment on some of the specific industries in particular countries which have been referred to by noble Lords. The noble Viscount, Lord Falkland, raised the question of film making. The Council has contributed significantly to the setting up of a British film office in Los Angeles; and it has also embarked on a series of activities to help develop the fledgeling film industries in a number of other countries, in particular South Africa.

The noble Lord, Lord Birkett, spoke of the important work done by the Council in the field of music. Noble Lords may be interested to know that when the Prince of Wales visited South Africa in 1997, an important element of his visit was the youth exchanges between the young people of Britain and South Africa who worked together to produce a concert in South Africa. And the British Council sponsored the Women in Africa

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concert which brought together a number of different museums which performed in the Festival Hall. It was a unique experiment at that time.

Perhaps I may say this to the noble Lord, Lord Freyberg. I understand that the Council's grant-to-artists scheme was suspended due to internal budgetary constraints during the course of last year. But from the next financial year it will be restored. It is a worthwhile scheme, and the Council is now free to decide the priorities it wants in that sort of expenditure.

I turn to the points raised by the noble Baroness, Lady Hooper, in relation to Latin America. The Council's representation in Latin America enables it to support the Government's agenda in three priority areas: the promotion of modern Britain; good governance in human rights; and of course export promotion, in particular in cultural matters. As the noble Baroness said, much work has been going on in Brazil, focusing on the design sector in particular. But the Council also supports the network of culturas, the locally based anglophile English teaching centres which exist in many Latin American countries. Some of those are very big. They are of very high quality and a considerable asset to British interests. When I visited Cuba in the autumn of last year, I was delighted to be able to tell our friends in Cuba of the appointment of the British Council representative there.

In response to the noble Earl, Lord Carlisle, the British Council is also active in all three of the Baltic States. The noble Earl talked in particular about his experiences in Estonia. But the British Council is focusing resources now on the challenges of the EU accession process where, in conjunction with our Ministers, the Council can deliver high profile programmes across a number of different relevant subjects. The Council has assisted the Ministry of Education in Estonia to establish 10 regional teachers' centres and has set up eight outreach centres in Latvia and five in Lithuania, each of which has a collection of English language teaching texts and general information about the United Kingdom.

Perhaps I may say this to the noble Lord, Lord McNair. We hope that the Council will be able to plan to extend some work in the Sudan through the resource centres, perhaps to other cities and towns.

I turn now to Iran in response to the noble Viscount, Lord Waverley. The Council has looked at a range of options for resuming activity in Iran. Any decision to resume British Council activity there will have to take account of Iranian sensitivities, as the noble Viscount acknowledges. Agreement would need to be reached with the Iranian authorities further to raise the ceiling of staff allowed in our embassies--a matter we have discussed on previous occasions.

I congratulate my noble friend Lord Ponsonby of Shulbrede on the sheer ingenuity of his contribution in bringing in the British Youth Council. My noble friend can rest assured that the Government wholeheartedly support the work being done by the British Youth Council.

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The noble Lord, Lord Holme of Cheltenham, raised interesting points in relation to co-operation with our counterparts in France and Germany. There is co-operation, for example, in the Ukraine, Venezuela and Namibia. I shall be happy to send examples of that to the noble Lord if he would like me to pursue those matters with him in correspondence. There are some worthwhile examples of co-operation.

I thank all noble Lords who have participated in the debate. When I go abroad I am always impressed by my visits to the British Council. It is often the most visible part of the British presence in any one country--although I am sure that some of my colleagues in the Foreign Office will read the remarks of the noble Earl, Lord Carlisle, about the relative value of the Foreign Office and the British Council with considerable interest. The specialist talents in the British Council--the programmes and the contacts it makes--are invaluable contributions to our international relationships. Of course there will always be periods of difficulty. Of course there are times when it is difficult to adapt. But we know that the Council is keen to ensure that noble Lords are fully briefed on its activities. To that end, it is proposing to form a parliamentary association group. I think that that is a terrific idea and I encourage noble Lords with an interest in the British Council to join that group.

On a previous debate on this matter, one noble Lord described the Council as a priceless asset. It is. The Government recognise the valuable role which the Council plays in enhancing Britain's reputation and prestige abroad. The Government are determined to see the Council continue and develop, and to develop the reputation of this country in the world as a valuable partner in that great conversation of mankind.

8.47 p.m.

Baroness Kennedy of The Shaws: My Lords, I thank everyone for participating in this interesting debate. It has been truly heartening to hear your Lordships speak with such warmth for, and admiration of, the work of the British Council. It is a special organisation, as all noble Lords have said. It always seems a shame that not enough people in Britain know of its contribution, not just to our nation but to the world.

Coming into the British Council, I have said that I see my role as an advocate on its behalf. The truth is that the Council has many advocates, as we have seen here tonight. We have to sing its song loudly and to a wider public, and perhaps the noble Lord, Lord Birkett, could wave his conductor's baton and have us singing in harmony.

One of the great achievements of the British Council is its ability to meet the challenges of the modern world. Your Lordships will be delighted to know that around the world, probably tomorrow morning, conscious of this debate, Council staff will be getting on line to read all that noble Lords have said. They, I am sure, will be inspired and cheered on by your enthusiasm and high regard. I thank all noble Lords for making time to participate in the debate. In particular I thank my noble

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friend the Minister for her generous words, reassurance and support. Of course the issue of funding will remain thorny.

I think it will come as no surprise to the noble Baroness when I say that I intend to be a warrior in Whitehall on the British Council's behalf. I can be quite doughty when I set my mind to it! Perhaps together she and I can make that assault on the Treasury which was suggested by the noble Lord, Lord Holme. It is certainly my intention.

I wish finally to express my gratitude to noble Lords who organise the business in this House. They succumbed to my blandishments and made space for the debate. They know who they are, and I am truly indebted to them. I beg leave to withdraw the Motion.

Motion for Papers, by leave, withdrawn.

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