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Lord Falconer of Thoroton: My Lords, there will be a percentage reduction of 1.5 per cent in 1998-99. The reduction in expenditure is from £24.1 million to £23.3 million. There are some quangos we cannot get rid of but we are doing what we said would do--making sure that there are no unnecessary quangos.
Lord Falconer of Thoroton: My Lords, I do not believe that the word "quango" exists in the English language, let alone the Welsh language. That is why "quangaroo" or non-departmental public body may be more appropriate.
Lord Roberts of Conwy: My Lords, will the Minister tell us how many more quangos will be created as a result of the passage of the 28 Bills envisaged in the Queen's Speech? If he cannot give the answer off the top of his head or from his brief today, will he agree to write to me?
The Earl of Northesk: My Lords, notwithstanding that reply, in the context of the German Government giving £80 million-worth of state aid to the failing construction giant Holzmann, do the Government support the view of Willem Duisenberg that:
Lord McIntosh of Haringey: My Lords, I noticed that the noble Earl carefully avoided the fact that Mr Duisenberg did not refer specifically to Holzmann or to any other German policy. Any disagreement between Mr Duisenberg and the German Government is a matter for them.
The Lord Privy Seal (Baroness Jay of Paddington) : My Lords, there is plenty of time for this Question. Perhaps we should hear from the noble Lord, Lord Taverne, and then from my noble friend Lord Stoddart.
Lord Taverne: My Lords, will the Minister agree with three propositions: first, that forecasting the course of a currency in the short term is a black art rather than a rational activity; secondly, that most of the worries about the euro are misplaced since it is not having any inflationary effect inside the eurozone and is helping its exporters; thirdly, that those who have most to worry about in relation to the low value of the euro are British exporters who find themselves excluded from the eurozone?
Lord McIntosh of Haringey: My Lords, the short answer is yes, yes and yes. On the noble Lord's second question, there seems to be a general misunderstanding, notably in the public prints, that if there is a low level of exchange rate that that is somehow a tragedy for the euro and that that is a measure of the lack of success for the euro. The same people seem to be able to say, without any sense of self-contradiction, that the high level of the pound is a tragedy for us.
Lord Stoddart of Swindon: My Lords, since we are not members of the eurozone, would it not be invidious for this Government, indeed, this House, to comment on the dealings of Mr Duisenberg in relation to countries that are within the eurozone? Should we not instead rejoice in the fact that we are not part of the eurozone; that the pound is doing so well; that our economy is thriving; and that unemployment is falling? That is in complete contradistinction to what is happening in countries in the eurozone itself.
Lord McIntosh of Haringey: My Lords, I agree with my noble friend's first question and I agree with the conclusion of his first question, although not the premise on which it is based. It is certainly not because we are not in the euro or indeed in Europe that the Chancellor has been so successful in economic policy.
Lord Marsh: My Lords, does the Minister not agree that the concern is not about the exchange rate at any particular given time? It will go up; it will go down. People are concerned about the unexpected volatility of the euro and the doubts that that must raise as to its long-term stability as a reserve currency?
Lord McIntosh of Haringey: My Lords, I find myself agreeing with nearly every question that I am asked. Of course, the noble Lord is right. It is the stability, rather than the exchange rate at a particular time or short-term variations, which is important. But over the past year, experience has shown that we have not maintained a general stability of exchange rates and our economic performance has been a reflection of that.
Lord Saatchi: My Lords, does the Minister agree that my noble friend Lord Northesk makes a fundamental point about politics and the euro? The Government have put forward five economic tests to determine whether we should join the euro. Do we not need a sixth test; a political test which could assess Britain's convergence with the political philosophies of prospective partners in a single currency? How does the Minister think such a test would assess the statement of the German Chancellor that Britain should not place national interest above necessary European solidarity?
Lord McIntosh of Haringey: My Lords, the five economic tests announced by the Chancellor in October 1997 are what they were announced to be; that is, economic tests. Clearly, both political and, as we have always said, constitutional questions arise as a result. When we are satisfied that the economic tests have been achieved, political questions will arise. That is why we have always said that before a decision is finally taken we will seek the opinion of Parliament and the people through a referendum. The point raised by the noble Lord will be a matter for debate at that time.
Lord Barnett: My Lords, does my noble friend not agree that some of the comments would have been made whether the euro goes up or down? It would be common sense not to get too excited about a particular level at a particular time. Has my noble friend noticed that a sophisticated financial market--that is, Hong Kong--is buying euros at present? Does he think that has any consequence?
Lord McIntosh of Haringey: My Lords, I do not want to speculate on what gamblers are doing in Hong Kong any more than I want to speculate on foreign exchange markets as a whole. There is a point in what my noble friend says, in that a number of people are buying particular currencies as a hedge against possible difficulties at the time of the millennium. I do not know whether that applies also to Hong Kong.
Baroness Scotland of Asthal: My Lords, Her Majesty's Government have left the Russian Government in no doubt that we deplore the threat to Grozny. My right honourable friend the Foreign Secretary raised our concerns with the Russian Foreign Minister this afternoon. My honourable friend the Minister of State, Mr Vas, summoned the Russian Ambassador yesterday to ask him to convey to Moscow the alarm and dismay of Britain and its partners at recent events. If Russia proceeds with its threat to Grozny, we expect the Helsinki European Council to consider the future of European Union assistance to Russia.
Lord Moynihan: My Lords, there are many thousands of men, women and children who may be too sick, too old or simply too terrified to leave Grozny. The Minister will be aware that in the case of Kosovo, the Foreign Secretary said:
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