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Lord Howell of Guildford: I agree with that and hope that nothing that I said earlier contradicts that view. Israel must urgently find and adopt a better way of limiting any arms and bombs going into Gaza, while at the same time providing for the needs of the
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Lord Phillips of Sudbury: My Lords, the Minister referred to the rockets fired from Gaza into Sderot and other places. I urge him to listen to the point made by the noble Lord, Lord Pannick, and to the quarter or third of the population of Israel who view Israel's strategy and policy, in particular the colonisation of the West Bank, as being totally self-defeating for its long-term security, totally abhorrent in terms of human rights and totally against international law. I was in Gaza in January, for the third time in eight years. Some debates that one listens to in this Chamber-I mean no disrespect to any noble Lord-seem to be based on a misunderstanding of the abjectness of the condition of not only the Gazans but also the people in the West Bank and of the ritual, systemic humiliation and violence to which they are subject. It is all very well talking about a few home-made rockets-and I do not defend them-but there is an occupying army in the West Bank and there was a pulverisation of Gaza a year ago, in which 1,400 people were killed as against 13. I urge the Government to get real about these issues and not to pretend that there is parity between one side and the other.
Lord Howell of Guildford: I think that my noble friend's views are very widely shared. I listened carefully to the noble Lord, Lord Pannick, who rightly said that there are a large number of people within Israel, as well as among those who look on and admire Israel from around the world and believe that it has every right to exist as a nation in security, who feel that its present policies are certainly not achieving that aim.
Baroness Anelay of St Johns: My Lords, 55 noble Lords have signed up to speak in today's debate. If Back-Bench contributions are kept to five minutes, the House should be able to rise at around our normal target time of 10 pm.
"Most Gracious Sovereign-We, Your Majesty's most dutiful and loyal subjects, the Lords Spiritual and Temporal in Parliament assembled, beg leave to thank Your Majesty for the most gracious Speech which Your Majesty has addressed to both Houses of Parliament".
Baroness Wilcox: My Lords, it is a great privilege to open this debate on Her Majesty's gracious Speech. I thank my noble friend Lord Henley, who will be winding up today. He is no stranger to being a Minister, and I am extremely grateful for his experience.
Our discussion will cover business and economic affairs, the environment, energy, agriculture and transport. These issues are essential to securing Britain's economic recovery and global success in the future, and the gracious Speech supports the Government's ambitious agenda decisively to tackle Britain's deficit, to address the fundamental causes of the financial crisis, to build a sustainable private sector recovery that is balanced across all regions and industries, to promote resource sufficiency and the protection of our environment, and, finally, to secure the right mix of public and private sector investment to modernise Britain's infrastructure.
The Government's most immediate task must be to reduce Britain's record deficit. According to the IMF and the European Commission, this year it is set to be the largest in the G7 and the European Union. The Government are borrowing £1 of every £4 they spend, which is a drag on our people's ambitions and efforts to foster growth.
The Government must take action now. With the support of the Bank of England and based on analysis from the Treasury, we have identified and committed to cut more than £6 billion of wasteful spending across the public sector. Focused on protecting the vulnerable and maintaining the quality of our front-line services, these measures will increase efficiency and value for money, and enable government to reinvest part of these savings in Britain's long-term growth.
Wider reform is also needed to boost credibility and trust in the UK's fiscal framework and financial regulatory system. With its statutory responsibilities enshrined in the budget responsibility Bill, the new Office for Budget Responsibility will make an independent assessment of Britain's public finances and economy, putting us at the forefront of international best practice.
The Government's budget forecasts over the past decade have underestimated borrowing compared with independent forecasts. On average, in that same period, their forecasts for economic growth have also been out by £13 billion. An independent Office for Budget Responsibility will ensure that policy is developed based on a more accurate picture of Britain's public finances and prospects. Its first findings will inform the emergency Budget on Tuesday 22 June and future fiscal events.
Out of the millions of words written about this financial crisis, its causes are clear: reckless lending, excessive borrowing and poor financial regulation. Breeding confusion over the roles and responsibilities of its authorities, the current tripartite system-the Bank of England, the Financial Services Authority and the Treasury-has failed to do its job. We need to learn from these mistakes.
The Government believe that the Bank of England, with its clear remit for monetary policy, is best placed to strengthen the link between financial stability and macroeconomic policy and, as a result, monitor and
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The Government are also developing measures to establish a more stable and effective banking system and ensure that profitable businesses, especially small and medium-sized enterprises, can access the credit they require to succeed. Ultimately, it is these businesses that will generate the growth and innovation that we need but, to do that effectively, government must promote, not stifle, their enterprise. Our Government are committed to developing a new model for the British economy-one that is balanced across all regions and sectors, supports sustainable growth and enterprise, works with rather than against the natural environment, and enables us to seize market share in leading global industries such as low-carbon.
That demands that we set out a clear vision of how Britain needs to earn its living in the future and deliver the open, competitive business environment, skilled, flexible workforce and cutting-edge infrastructure needed to make it happen. To do that, the Government are working to free small and medium-sized businesses from unnecessary regulation, cutting through the burden of red tape that holds them back, and making it easier for entrepreneurs to start a new business.
We are reforming our tax system so that it is simpler, fairer and more competitive. As part of this work, the national insurance contribution Bill will bring forward necessary changes to safeguard jobs and support the economy. We also want to increase the potential for SMEs to sell their high-tech products and services around the world and to win public sector contracts. We will also make it easier for small businesses to do business with government by making opportunities easier to find and by simplifying and streamlining the procurement process.
We shall also work with our universities and colleges to strengthen their links with industry and ensure our people have the skills they need for the jobs these companies create. In addition, we will remove barriers to flexible working, helping businesses to recruit and retain talent and enabling individuals to balance work demands with their family responsibilities. In the coming months, we will consult fully with business and families to identify the best way to introduce this change.
In each of those areas, new technologies and the demand for sustainable solutions present us with significant challenges and opportunities. In energy and environment, we need to tackle climate change; use our natural resources more effectively; secure low-carbon energy supplies; and cut our carbon emissions. In the long term, economic growth depends on the raw materials provided by our environment and it is crucial that we gain a better understanding of their value and how we can best manage them in the decades to come. The Government will, therefore, introduce a natural environment paper, the first since 1990, setting out a new, more integrated strategy to the management of our natural environment, including action to protect wildlife and increase biodiversity. The Prime Minister
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To ensure the finance is available to help us make the most of that opportunity, the Government are creating a green investment bank and will develop new green financial products and a range of wider measures. The energy security and green economy Bill is a key part of that programme, providing the right legislative framework to deliver a successful low-carbon future for Britain. To do so, it will help to increase energy efficiency in our country by enabling a pay-as-you-save approach. Our green deal will enable householders to benefit from efficiency measures and repay the cost of this work over time through energy bill savings, rather than having to spend large sums of money upfront.
As well as reducing carbon emissions and household energy costs, this green deal will support a green recovery. It will drive the creation of more green jobs, alongside clear quality standards and help green industries and expertise in this country to grow. Subject to detail and any necessary legislation, further measures may include energy market reform to secure our energy supplies and shift to low-carbon sources-that is in addition to our work with Ofgem to develop a security guarantee for our energy supplies; the introduction of an emissions performance standard to regulate the emissions from coal-fired power stations; a requirement for energy companies to provide more information on energy bills, empowering customers to make the right green energy choices for them, including information on the cheapest tariff available and useful comparisons of energy usage; and, finally, a framework for the development of a smart grid to revolutionise the management of supply and demand for electricity in Britain's low-carbon future.
Some have queried why there was nothing in the gracious Speech on nuclear power. Quite simply, there is no need for a new Bill in order to bring forward new nuclear. The Government are committed to allowing the construction of new nuclear power stations provided they receive no public subsidy and, through the Office for Nuclear Development, we will continue to drive forward the actions needed to remove unnecessary obstacles to the deployment of nuclear power. This includes the completion of the draft nuclear national policy statement to be tabled in Parliament.
Also central to our low-carbon future is the creation of a modern, sustainable transport system for Britain. We have already made it clear that we do not support the construction of a third runway at Heathrow, or any plans for new runways at Stansted and Gatwick. We want to make Heathrow better not bigger, and to boost the performance of our airports for the people who use them.
Improving the framework for airport economic regulation is vital to this. And we will reform existing arrangements for setting price caps at airports to establish a more flexible framework focused around passengers. In addition, we are committed to establishing a high-speed rail network. Our vision is for a truly
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In due course, we propose to seek powers to deliver the first phase of that network through a hybrid Bill later in this Parliament. But substantial work is needed ahead of this, and we will continue to develop our proposals. This includes carrying out a full and open public consultation with those who may be affected by any high-speed line.
Every day, new technologies are revolutionising how businesses connect with their customers and people communicate. Unsurprisingly, this has had a radical impact on the business of the Royal Mail. The postal services Bill will seek to tackle the fundamental and long-standing problems facing this organisation in a modern communications environment. It will aim to enable the Royal Mail to benefit from private sector disciplines and capital, including possible opportunities for employee ownership, ensure the continued provision of a universal postal service and safeguard the future of the Post Office network.
Also, as other countries roll out next-generation high-speed broadband, the Government will be looking at ways to enable a strong, market-led approach to its deployment in this country, ensuring that people and communities in rural, as well as urban, areas can benefit from this technology and businesses across the country can compete. Just as any family or successful business knows, it is taking a big risk on its future with too much debt-Britain cannot build its recovery without urgent action to reduce the deficit, increase market confidence and restore balanced, sustainable growth to our economy. The gracious Speech sets out and supports our Government's measures to make that happen and sends a strong message that Britain is open for business.
We will have the talent, the technology and the tolerance to take our country forward. We will remove the over-restrictive ties that presently bind us; protect the vulnerable; and revel in the freedom that our unwritten constitution has given us and that has allowed this exciting journey to new politics, which our people have faith in us to begin. I look forward to our debate on these important issues.
Lord Myners: My Lords, I begin by congratulating the noble Baroness, Lady Wilcox, on her appointment to government. This must be the first time in many decades-possibly ever-that part of the debate on the humble Address has been led by two people of Cornwall. I also compliment the noble Lord, Lord Henley, on his return to the government Benches.
This will be my last contribution from the Opposition Front Bench, as I move to the Back Benches to make room for colleagues more skilled in the art of politics and opposition. I should therefore like to use the occasion to express my appreciation to the noble Baroness, Lady Noakes, for the detailed focus she brought to shadowing me when I was in government. I should also like to record my thanks to the noble
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I will focus my remarks today on matters relating to the economy, public finances and the financial sector, because everything else depends upon this. My colleague, my noble friend Lord Young of Norwood Green, will also speak to these subjects and other matters in his closing speech.
The Labour Party lost the general election. We need to reflect on the reasons for our failure and develop a set of coherent proposals which will appeal to the aspirations of the broader electorate. We should be proud of many of our achievements while in Government, but we need to recognise that jobs cannot be created by interminable meetings in the COBRA war room. Government needs to work with the grain of the private sector, creating a pro-enterprise context with the right incentives and rewards for success.
We now need to focus on the challenges and responsibilities of effective opposition. We will not oppose for the sake of it; nor should we oppose proposals from the Government which we would have made had we been re-elected. For instance, I do not see why we should take issue with the intention behind the Equitable Life Payments Scheme Bill or the Terrorist Asset-Freezing Bill, although we will of course scrutinise the detail.
We will be vigilant in our analysis of and response to government proposals which we judge to be unfair, damaging to essential public services or injurious to jobs and business. We are told that the Government's legislative programme will be based on the principles of freedom, fairness and responsibility. The Queen's Speech tells us nothing about how the new Government will resolve the inevitable tensions between those fine words. We will be testing the Government against those principles. The Queen's Speech is where the "dignified" part of the constitution passes to the "efficient". The Government have been clear that in their view, to cite the coalition document,
The Opposition do not dissent from the view that there needs to be a clear path to sustainable government funding, including a significant reduction in the public sector deficit, but we question the timing and pace of the deficit reduction programme. The risks of moving too soon or too late are not symmetrical. Over-hasty action will push the economy back into recession and a ballooning rather than a contracting of the deficit. That was the view of the Liberal Democrats until three weeks ago.
The economy is showing signs of recovery from the global recession, supported by the previous Government's stimulus package, but private sector consumption and investment are still too anaemic, in my judgment, to
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It has been entirely right and proper in the circumstances that the Government continued to support economic activity through a targeted programme of expenditure designed to protect the most vulnerable and facilitate the return to growth. This should continue until the private sector demand and investment process recovers. Our action in that respect in 2008-09 achieved a considerable measure of success, particularly compared with the experience of Tory recessions in the 1980s and 1990s. The strategy that we followed was sensible and well within the Government's financing capabilities. Real yields on gilts are below 1 per cent, and nominal yields are below 3.5 per cent. The ratio of gross debt to gross domestic product is below that of all our major competitors, and still below the long-term average for the UK. The average maturity of our debt is more than 14 years. The private sector is currently running a surplus that represents nearly nine-tenths of the fiscal deficit. We must not lose sight of the interaction between the private and public sectors in terms of deficits and surpluses.
Fiscal tightening will work only if it coincides with a robust private sector recovery. If that is not the case, the Government's action will drive the economy back into recession with an increasing public sector deficit. In such circumstances, dogma and intransigence will be pursued at very real cost to people's lives. Recovery cannot be taken for granted, particularly if the public and private sectors here and overseas are engaged in simultaneous and unco-ordinated balance sheet adjustments. It is incumbent on the new Government in this respect to follow the lead set by their predecessor in shaping and influencing international co-operation on economic management. The new Chancellor will have his first test this weekend at the G20 meeting. We look forward to receiving his report.
I referred earlier to the position that Liberal Democrats took during the election campaign on the need to eschew early or harsh spending cuts. Mr Nick Clegg, the Deputy Prime Minister, justified his change of position in supporting George Osborne's spending cuts, having opposed them during the election, by saying on the "Andrew Marr Show" on BBC1 on Sunday 23 May:
I look forward to hearing the views of the noble Lords, Lord Desai and Lord Skidelsky, on this arrant nonsense. European economies-our principal export market-are weakening. Gilt yields have fallen, signalling a sense of heightened anxiety about growth and risk, as further evidenced by increased risk tendencies within the banking sector. Sterling is strengthening, yet our Deputy Prime Minister now believes that these circumstances justify the introduction of measures
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The coalition Government need to spell out those parts of the economy that they have identified as the engines for growth in 2010-11. What will act as a catalyst for an improvement in the private sector? What will improve demand and investment when so many countries are in retrenchment? The Minister talked about a balanced economy. How do the Government intend to balance the economy? What do they intend to suppress in economic activity? What activities do the Government wish to see diminish in importance in our economy? It is certainly most odd that in these circumstances Mr Osborne should have chosen last week to give high priority to reducing business support schemes and that Mr Cable should have failed to make the case for business. Perhaps Mr Cable has concluded that he is powerless to challenge Mr Osborne.
The Minister referred to wasteful expenditure. We are all in favour of cutting waste, but cancelling 10,000 university places is not cutting waste; it is cutting our capacity for the future. Cancelling 40,000 jobs for young people under the Future Jobs Fund is not cutting waste; it is blighting prospects. Cutting child trust funds is hitting the poorest and has no impact on public expenditure, as the assets within those funds have to be retained within the banking system.
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