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Baroness Hollis of Heigham: I cannot possibly anticipate what forms or slips or pay packets might look like several years down the line when children's tax credits and others may have been fully introduced. That is, if I may say so, a rather silly question.

Lord Higgins: We have now heard an interesting statement that paragraph 5.13 does not say that this is not going to happen for seven years, which perhaps it should have done because then we would be clearer about the Government's objectives. It would be helpful to receive an answer to the original question of the noble Lord, Lord Peston. We can discuss the other matters on later amendments.

Baroness Hollis of Heigham: The noble Lord, Lord Peston, says he believes he had an answer. If he is satisfied, I do not see why the noble Lord should be dissatisfied.

Lord Higgins: The only difference is that the noble Lord received the answer from me and not from the Minister. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord McIntosh of Haringey: My Lords, I beg to move that the House be now resumed.

Moved accordingly and, on Question, Motion agreed to.

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House resumed.

Lord McIntosh of Haringey: My Lords, before we move to the Statement on the NATO summit, I should like to take this opportunity to remind noble Lords that the Companion indicates that discussion on the statement should be confined to brief comments and questions for clarification. Peers who speak at length do so at the expense of other noble Lords.

NATO Summit

4.15 p.m.

Baroness Symons of Vernham Dean: My Lords, with the leave of the House, I shall now repeat a statement being made in another Place by my right honourable friend the Prime Minister.

    "With your permission, Madam Speaker, I will make a statement on the NATO Summit in Washington on 23-25 April. I was accompanied by the Foreign and Defence Secretaries and the Chief of the Defence Staff. Copies of the Washington Declaration, the alliance's new strategic concept, the summit communique, our separate statement on Kosovo and other summit documents, are being placed in the Library of the House.

    "The summit was naturally dominated by Kosovo. NATO reaffirmed its basic and unalterable demands: Milosevic must withdraw his troops and paramilitaries; an international military force must be deployed and the refugees returned in peace and security to their homeland. The communique on Kosovo made it clear these demands will not be compromised.

    "NATO decided that the air campaign should be intensified; that the number of aircraft and targets should be expanded; and that the economic measures against Belgrade should be increased. In particular, we greed an embargo on oil, to be made effective by the measures necessary, including maritime operations.

    "There was also discussion of the circumstances in which ground troops would be deployed. As I said to the House of Commons last week, the difficulties of a land force invasion of Kosovo against undegraded Serb resistance remain. But Milosevic has no veto over NATO's actions. It was agreed at the summit that the Secretary General of NATO and the military planners should now update their assessments of all contingencies. Meanwhile, the build-up of forces in the region continues.

    "In addition, we agreed to provide all assistance to the International War Crimes Tribunal in respect of the atrocities committed against Kosovar Albanians. We also warned Belgrade against any move to undermine the democratically elected government of President Djukanovic in Montenegro.

    "NATO's military commanders, General Clark and General Naumann, briefed the summit on the progress of the air campaign. NATO has largely isolated the Kosovo battlefield and built what General Naumann

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    described as a ring of steel around the FRY. Six hundred and ninety aircraft and 20 ships are now deployed--more than double the force at the outset of this campaign. Half the Serb fighter planes are now destroyed. FRY air defences are ineffective, with over 70 aircraft and some 40 per cent. of the SAM 3s and 25 per cent. of the SAM 6s destroyed. Oil refining and distribution have been massively disrupted, already leading to Serb operations in Kosovo being halted on several occasions in the past two weeks. The day before the summit meeting, six tanks, 27 military vehicles and an infantry column had all been destroyed in Kosovo. These operations continue and as the weather clears and more attack weapons arrive, that type of action will become a daily occurrence.

    "Russian efforts to find a diplomatic solution to this crisis are welcome. But there can be no alteration to our fundamental demands.

    "NATO will also continue its efforts to relieve the humanitarian crisis that Milosevic has cynically provoked in and around Kosovo. NATO troops have helped deliver 11,000 tonnes of aid, and provided food and shelter to some 85,000 refugees. I met the Presidents of Albania and Macedonia and pledged Britain's support for them in dealing with the refugee crisis Milosevic's repression has created.

    "The full extent of the horrific repression by Serb forces in Kosovo is only emerging now. There has been organised systematic rape of women, usually in front of husbands and children. Young men have been forced to dig graves, then shot. Whole villages have been razed to the ground. Some of the stories of the cruelty and barbarity practised by Serb militia are evil beyond belief. We have heard reports of Kosovars hiding in the hills for weeks and having to walk for days to escape Serb repression. Some, particularly children and the elderly, have died as they tried to escape. Some who have escaped, including children, have reached safety with bullet or shrapnel wounds inflicted by Serb forces. The UNHCR today has substantiated reports that women and children are being used as human shields, including in a building used to store ammunition.

    "In the meeting with the leaders of the seven non-NATO countries neighbouring Serbia, we were united in our resolve to strengthen efforts to promote stability and development in south-east Europe.

    "For their part what was remarkable was the view of the front line states that the NATO action was just, and that NATO must win. Milosevic is now a pariah in his own region.

    "We also looked ahead at means of contributing to the long-term stability of all the Balkan states. At our initiative, NATO leaders agreed to establish a regional security forum for south-east Europe between NATO and the countries of the region. It was agreed that NATO should work together with the United Nations, the Organisation for Security and Co-operation in Europe, the European Union and the international financial institutions in this endeavour.

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    "Madam Speaker, this summit had an important agenda before it, quite apart from the Kosovo crisis. It was the occasion to adapt the Alliance to meet future needs and challenges. While NATO's fundamental role will remain the defence and security of the allies, there was an equally strong consensus on the need for a more capable and flexible Alliance, able to contribute to security throughout the Euro-Atlantic area and to promote the values of democracy, human rights and the rule of law for which it has stood since its foundation. In doing so, member states reaffirmed their commitment to the Washington Treaty and the United Nations Charter.

    "We approved an updated strategic concept which set out the fundamental security tasks of the Alliance and how we intend to fulfil them. Common defence and the transatlantic link will of course remain the bedrock of the Alliance. But the new strategic concept recognises that in today's world the ability to respond to crises and develop partnership with countries which were once our adversaries are crucial to our interests and the promotion of our values. The strategic concept also provides top level guidance for the restructuring of Alliance military forces. The defence capabilities initiative agreed at the summit will give effect to this by adapting and modernising NATO's capabilities along similar lines to our own Strategic Defence Review.

    "The strong partnership between the European and North American members of the Alliance is the key to the success of NATO and to our security. The summit unanimously welcomed and endorsed the initiative which I and President Chirac launched at our summit last December in St. Malo, to develop a European defence capability for crisis management operations where the Alliance as a whole is not engaged.

    "A stronger European capability will strengthen NATO and is fully compatible with our commitment to NATO. Making NATO a more balanced partnership will strengthen the essential transatlantic link. The Alliance stands ready, as the EU defines its defence arrangements, to make NATO force planning, NATO assets, and NATO headquarters available for EU-led crisis management operations, subject to the necessary approval by the North Atlantic Council. We emphasised the importance of fully involving those allies who are not members of the EU in this process. These decisions will ensure that NATO and European capabilities develop in a fully compatible manner.

    "Madam Speaker, in Washington we welcomed for the first time at a NATO summit the leaders of Poland, Hungary and the Czech Republic, the Alliance's new members. We reaffirmed the Alliance's continuing openness to new members and agreed a new membership action plan for countries that aspire to join the Alliance.

    "We met the Heads of Government of 23 non-NATO nations in a summit meeting of the Euro-Atlantic Partnership Council which showed the breadth of support of the Alliance's efforts to spread security and stability throughout the Euro-Atlantic area.

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    "Regrettably, Russia was not represented at this meeting. However, throughout our discussions and in the communique we made clear our wish to work co-operatively with Russia on a wide range of security issues and to resume regular NATO consultation and co-operation with Russia in the Permanent Joint Council.

    "Madam Speaker, there were two key outcomes of the summit. A new vision for the future of NATO was set out, of new roles for NATO, new capability, new partnership with the nations of central and eastern Europe and beyond in central Asia. And, secondly, there was the total and unified commitment by all the members of the Alliance to defeat and reverse the policy of ethnic cleansing in Kosovo. Each leader began his statement by saying NATO will and must prevail. It is our collective task now to make that victory, of justice over evil, a reality for Kosovo's long suffering people".

My Lords, that concludes the Statement.

4.28 p.m.

Lord Strathclyde: My Lords, first, I thank the Minister for repeating the Statement by the Prime Minister. This is a Statement of supreme importance at a time of enormous doubt over the future course of events in the Balkans. We thank the Minister at least for having the courtesy to be here to report to the House today and for putting her undoubted expertise at our disposal.

NATO's resolute defensive alliance is one of the greatest influences for peace in world history. It preserved the peace in Europe for 50 years. It kept at bay the threat of totalitarianism. It kept the interests of the free nations of Europe and North America bound as one. It played the major part in winning the Cold War and dismantling the horror of the nuclear threat that had lain over Europe throughout my childhood.

The future role of NATO is as crucial as its past, and it deserves the same care and caution now as governments over 50 years have given it.

We reiterate our support and admiration for the men and women of the UK's Armed Forces. We believe it is vital for the future credibility of NATO that the tasks which have been, and will be, set for them are clear and can be seen through to a successful conclusion. Do the Government agree that what our forces, our allies, and indeed our enemies, and those nations not involved most need is clarity? So will the Government understand my concerns that despite consistent questioning from my colleagues and myself since the crisis began we have yet to receive clear, consistent and unequivocal political and military objectives from the Government?

I have four sets of questions to clarify matters in the light of the NATO summit. The first relates to ground troops. Last week, the Prime Minister signalled a change in policy on ground troops. He envisaged the active deployment of NATO forces against what he called a "degraded" Serb military machine.

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On 13th April in this House, the noble Baroness the Leader of the House said:

    "of course there may well be British and NATO ground troops involved, but that would be a peacekeeping force rather than a force intent on fighting its way into a difficult situation, which ... against Serbian refusal to accept any intervention on a legal basis would be very difficult'.--[Official Report, 13/4/99; col. 639.] What is government policy on ground troops? Is it being made up as we go along? Where is the clarity? Is the use of ground forces, other than as a peacekeeping force, now one of our strategic options? If so, what success did the Prime Minister have in convincing our NATO allies of the need to change policy? Will the Minister accept that if this policy is to be carried out it requires a fuller explanation than has so far been given to Parliament? The country will not wish to be led into a ground war by stealth.

I turn to the serious question of an oil embargo. Are the citizens of any NATO countries believed to be involved in the supply of oil to Yugoslavia? If so, what representations have been made by Her Majesty's Government? I understand that NATO has now decided to board and inspect all ships. What is the legal basis for that in maritime law or under the UN Charter? Are Her Majesty's Government now officially at war with Yugoslavia?

What does NATO plan to do if ships plying trade with Yugoslavia decline to be boarded? What rules of engagement have been given to Her Majesty's ships on what to do in such circumstances? Will they be authorised to open fire on neutral shipping in the Adriatic Sea? Is it intended to interrupt tankers bound for Yugoslavia outside the Adriatic or Ionian Seas?

I believe that the House will wish to be assured that there is absolute clarity on a matter of such potentially momentous import.

We share the Government's regret that Russia was not represented at the Heads of Government meeting of 23 non-NATO nations of the Euro-Atlantic Partnership Council. It remains our view that close co-operation with the Russians on security matters is vital, as is their influence and potential role in finding a solution to the continuing crisis in Kosovo. We hope that the Government will never underestimate the extent to which the Russians may well hold the diplomatic key to unlock a settlement to the humanitarian tragedy in the Balkans.

Last week, the Prime Minister commented to the US media that:

    "we carry on until Milosevic steps down". The Foreign Secretary said at the weekend that ethnic hatred could be defeated,

    "only when we get a change of regime in Belgrade". But, when asked by my noble friend Lord Trefgarne in the House last Wednesday whether it was now a war aim to remove President Milosevic from power, the noble Baroness, Lady Symons of Vernham Dean, replied, "No, my Lords". Would the noble Baroness be prepared to reconcile those statements? Again, where is the clarity here? Do we carry on until Milosevic steps down and there is a change of regime, or do we negotiate with him at the appropriate time?

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How far will we extend targets in Yugoslavia? When this action began on 25th March, the noble Lord, Lord Gilbert, responded to the noble Lord, Lord Stoddart, by saying:

    "We are addressing a very small number of precise military targets, in exactly the same way as we were doing in Iraq".--[Official Report, 25/3/99; col. 1512.] Are radio stations "precise military targets"? Do the Government confirm the statement of Mr. Berger, the US National Security Adviser, that NATO is now out to strike what he called "high-value national assets", including the electricity grid, water supplies and the national telephone system? Have we not come a long way from a "very small number of precise military targets" in a short month? If we are moving on, where are we going and can we be clear?

Finally, there is need for clarity on the long-term future of NATO, in particular the EU place in it. We welcome the fact that the European defence identity will be developed within the NATO structure, but where does the development of an EU-led capability leave countries such as Turkey--which is of vital strategic importance--which are members of NATO but not of the EU?

However, in the light of what the Prime Minister said in his Statement, would the Minister care to comment on whether the agreement signed by him at last renders obsolete the St. Malo agreement he signed last year and the specific idea of developing an EU defence identity outside NATO, something we warned against then and still view as unacceptable?

Once again, there is surely a case for clarity. Is the Government's policy an EU capability inside NATO or outside NATO? It is difficult to see how the two agreements can be reconciled.

To conclude, on behalf of these Benches I express the wish that NATO is as successful in the next 50 years as it has been during its first 50. I look forward to the Minister's reply.

4.37 p.m.

Lord Rodgers of Quarry Bank: My Lords, I, too, join the noble Lord, Lord Strathclyde, in welcoming the Minister and thanking her for repeating the Prime Minister's Statement. I hope that it will not be regarded as churlish to associate myself with remarks made by the noble Lord, Lord Henley, earlier today. The first duty of every Minister is to Parliament. On an occasion of this kind, the noble Baroness the Leader of the House should have been present. The summit was not a sudden event; it could have been anticipated. If it were anticipated, it would have been known that the Prime Minister would make a Statement on the following Monday. In those circumstances, there was adequate time for the Leader of the House to make alternative arrangements. I regret her absence and I hope that in future she will participate more fully in these discussions.

There are two statements in the single Statement made by the Prime Minister. The first is about NATO operations in Kosovo, a short-term issue which is of great concern to the House. The second is about the new

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strategic concept of NATO, what the Prime Minister in his Statement called "a new vision". That needs the closest scrutiny. The outcome in Kosovo is only one factor in a major long-term development which it is right that we should examine and discuss in full.

Indeed, we shall have a debate in your Lordships' House on Thursday 6th May. It was to be introduced by the noble Lord, Lord Gilbert. I hope that it will be recognised by all sides of the House that the debate must go much wider than the defence considerations of Kosovo. It must look not only at the issue of the refugees, but at the whole future of the Balkans. Speaking from these Benches, I believe that it would be highly unsatisfactory if the debate were not widened. Indeed, that would be a good opportunity for the Leader of the House on such an important occasion to lead for the Government and bring all these important issues together. As regards the short term, we know that the short, sharp shock in Kosovo, the air strikes, have turned into a major war of attrition. It has been recognised that, for good or for ill, there is a larger role for ground troops than the Government were prepared to recognise two or three weeks ago. Indeed, the Prime Minister acknowledged that in the Statement when he referred to "contingency planning". That must be recognised as a major shift of policy on the Government's part.

As regards the long term, the Statement listed very properly the major issues which were discussed at the summit and which underlie the communique: first, crisis management and response options in what is now called the "Euro-Atlantic" region. That alone deserves a very careful examination to see what NATO will be concerned with out of area. Its great success over the past 50 years must not lead us to assume that there is a major out-of-area function for it.

Secondly there is an argument for, as I believe the Prime Minister described it, a more balanced partnership between the North American parts of NATO and their European allies. I welcome that. But we must consider carefully how we can develop a European defence identity while recognising at the same time that for the foreseeable future we must draw the United States into Europe. We must not allow isolationism to develop so that it feels that it no longer has a place in problems of this kind.

Indeed--and I have referred to this already in respect of the debate we are to hold--there are major foreign policy issues about the long-term future of the Balkans and whether those countries will be turning to the east or the west; and about the need to have a plan for post-war reconstruction. All that needs to be thought about when a military operation is in progress. We can then look at the strange birth of the old diplomacy which is one result which could have been anticipated by the break-up of the Soviet Union but the full weight of which was not clear until the events in Yugoslavia and more particularly the recent events in Kosovo took place.

I ask three brief questions of the Minister, the first of which is very straightforward. We have been led to believe--it has been commented on widely--that the Prime Minister's speech in Chicago marked a major

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development of government policy. In addition to the documents which will be placed in the Library, perhaps we may have a copy of that speech so that we can measure precisely what has been said.

I hope it is not too soon, because I am sure the Chancellor of the Exchequer will be concerned about this, to make some estimate of the additional costs falling upon the defence department as a result of the Kosovo intervention. The noble Baroness may tell me that that is part of the contingency arrangements of the present year's budget. If so, so be it. But at least we should know and it is important that the calculations should be made.

Thirdly, I pick up an important point made by the noble Lord, Lord Strathclyde, whose questions were all relevant in that respect, The experience of oil sanctions elsewhere in the past has been that, for the most part, they have been unsuccessful. In view of that, do the Government really believe that they can be successful on this occasion? What percentage of oil reaching Yugoslavia do Ministers really anticipate will be stopped as a result of the arrangements which we are now discussing?

4.45 p.m.

Baroness Symons of Vernham Dean: My Lords, I thank both the noble Lords, Lord Strathclyde and Lord Rodgers of Quarry Bank, for their broad support on those issues. I should say to the noble Lord, Lord Rodgers, that my noble friend the Government Chief Whip gave a clear explanation of why my noble friend the Leader of the House is not here. I am sure that your Lordships will recognise that Northern Ireland is also an extremely important issue at present. My noble friend had a long-standing engagement which would have occasioned a good deal of difficulty and disappointment had she been unable to fulfil it.

Both noble Lords made a number of points to which I shall do my best to respond as fully as I can. I associate myself with the remarks of the noble Lord, Lord Strathclyde, about NATO having preserved the peace for 50 years. I reiterate that NATO remains the cornerstone of the Government's defence and security policy as we have had occasion to discuss many times in your Lordships' House in the past two years. That was developed very well in the discussion on the strategic concept which took place in Washington last week. Again, we have had the opportunity to discuss that in the House.

The noble Lord, Lord Strathclyde, said that clarity is needed in the Government's position on Kosovo. There has been a good deal of clarity on the political objectives. The noble Lord said that he is still not clear. Perhaps I may reiterate those objectives for him, as I thought I did last week. They are that there should be an immediate ceasefire; that Milosevic's forces should be withdrawn from Kosovo on a verifiable basis; that refugees should be able to return in confidence to their homes; that there should be an international security force on the ground in Kosovo to make sure that the refugees have that degree of confidence; and that there should be an acceptance of the political process,

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building on the Rambouillet accords. Those are five clear political objectives. The Government have stated and reiterated them on a number of occasions.

The noble Lord is also concerned that there should be clarity as regards the military objectives. The military objectives must be those which ensure that the political objectives are met. They are that there should be the degrading of the Milosevic war machine. Only last week we discussed this in your Lordships' House when the noble Lord, Lord Trefgarne, asked me specifically about military objectives. It will not have escaped the attention of the noble Lords, Lord Strathclyde and Lord Trefgarne, that I did not answer specifically about military objectives.

We are in a war situation at present. British troops are going in to fight. Over and above the general objectives which have been laid out, it is not in the best interests of our troops to specify particular objectives at present. However, I shall try to say more about that in a few moments, particularly in relation to points raised by the noble Lord about the television station.

We are about ensuring that our troops have the best possible chance of success. We are not about giving any help to Mr Milosevic. The clarity which the noble Lord demands, understandably, in respect of your Lordships' House, may mean that we are giving more clarity to Mr. Milosevic in relation to some of the points raised.

In particular, the noble Lord asked about the oil sanctions. They are being discussed today by my right honourable friend the Foreign Secretary. Therefore, the proposals for a maritime operation are still in the planning stages. We should take account of the legal implications of any NATO operation before agreeing it. Therefore, any action will be taken in accordance with the law. As I said, the details of how that is to be undertaken are under discussion today. As those emerge, if we can put them into the public arena and give the noble Lord more help on that point, I am sure that we shall do so.

The noble Lord was exercised also on the question of ground forces. We are concentrating on what can be achieved through an effective air campaign. We are inflicting serious damage on Milosevic's war machine through the very structures which keep him in power. With the allies at Washington, we agreed unanimously to intensify that air campaign in order to increase the pressure on Milosevic and to reduce his ability to wage war against his own citizens. However, at the same time, as the noble Lord will have noted, the Secretary General of NATO, Mr. Solana, has tasked the NATO military authorities to update the planning for ground forces in a variety of environments--I pick my words carefully. I say to the noble Lord, Lord Strathclyde, as I believe has been fairly clear now for some time, no option is being ruled out. I hope that brings greater clarity in the way the noble Lord felt was important.

The noble Lord raised a number of questions in relation to Russia. We regret that our Russian friends were not with us in Washington. We want to work with Russia. The Kosovo crisis does not negate any of the principles underpinning the NATO-Russia Founding Act 1997. We are aware and, I hope, sensitive to the

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domestic and parliamentary opposition in Russia at the present NATO dealings. However, the Foreign Secretary and the Prime Minister are keeping in close touch with their Russian counterparts. On 22nd April the Prime Minister had extended discussions by telephone with Mr. Yeltsin. He emphasised then that Russia has a vital role to play over Kosovo. I believe my right honourable friend also gave that clear message in a television appearance in Russia.

The noble Lord asked about the position concerning Milosevic. I gave the clearest possible answer on that to a direct question from the noble Lord, Lord Trefgarne, only last week. We believe that Milosevic has been an unmitigated disaster for his country. However, as I made clear to your Lordships, it is for the people of that country to decide who governs them. When we look at the way in which Mr. Milosevic has carried out repression against his own citizens and denied them any semblance of democracy, I think we must all agree that he is a brutal, cruel and repressive man. There cannot be any negotiation with him over his policy of ethnic cleansing. He has to meet our conditions. He has to withdraw his forces from Kosovo, allow the refugees to go home in peace and allow an international presence there to protect them.

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