The Informal Economic and Financial Affairs Council (ECOFIN) took place in Porto on 14 and 15 September 2007. The Informal Council discussed the modernisation of public administrations and its impact on competitiveness, the current economic and financial situation, and issues related to the IMF.

The main discussion focused on the impact of an efficient public administration on overall competitiveness. This is a stated Portuguese presidency priority; the quality of public finances is a common theme to the German, Portuguese and Slovenian presidencies.

The Informal Council also discussed the current economic situation and the volatility in global financial markets. I set out that as a global issue, this demanded a global response and made proposals to EU finance ministers that we must remain fully engaged, acting with the wider international community, in strengthening arrangements for ensuring financial stability. I will also be making proposals at the meetings of the G7 and International Monetary Fund in October. Ministers continued the long-running discussion of how to take forward EU arrangements for financial stability, and considered ongoing initiatives to improve cross-border post-trading arrangements in Europe. The Informal Council also discussed the reform of quotas and voice in the IMF.

The UK was represented by the Chancellor of the Exchequer.

The Economic and Financial Affairs Council will be held on 9 October in Luxembourg. The items on the agenda are as follows:

Implementation of the Stability and Growth Pact

Ministers will discuss Commission recommendations to abrogate the Excessive Deficit Procedure of the United Kingdom and discuss new recommendations for the Czech Republic to take further action in order to bring the Excessive Deficit to an end.

Public Finances in the EMU

Ministers will be invited to agree conclusions, following their discussion in July on the Commission’s annual Public Finances Report and accompanying proposals aimed at improving the effectiveness of the preventive arm of the Stability and Growth Pact by effectively applying the revised Stability and Growth Pact.

The UK Government support a prudent interpretation of the Stability and Growth Pact, taking into account the economic cycle, the long-term sustainability of the public finances, and the important role of public investment.

Quality of Public Finances

Ministers will be invited to adopt conclusions on the role that the modernisation of public administration can play in enhancing competitiveness, delivering better services, achieving better value for money and ensuring the control of government expenditure. The UK welcomes the sharing of experiences between member states on this issue.

Developments on the Economic and Financial Situation

Following on from discussions at the informal ECOFIN in September, Ministers will discuss the current economic situation and disturbances in global financial markets, including the possible policy responses to the issues raised. The UK strongly supports the proposed work of the Financial Stability Forum on these issues and is committed to pursuing an effective, considered global response to these global financial market issues.

Better Regulation

Ministers will be invited to agree on conclusions on better regulation and its role in improving EU competitiveness. The UK supports the positive efforts of the Commission and welcomes the progress made both at member states and EU level towards reducing administrative burdens in the EU.

Flexicurity

Ministers will be invited to agree conclusions on the economic aspects of flexicurity, welcoming recent work by the Commission on developing an approach towards shared principles to develop labour market flexibility alongside support by social systems. The UK believes that fiscal sustainability is critical in the face of Europe’s changing demographics.

Dialogues with Third Countries

Ministers will hear an update from the Commission on its dialogues with third countries, including USA, Japan, China, India and Russia, with a focus on the economic, financial and regulatory aspects of those discussions.

Financial Services—Clearing and Settlement

Ministers will be invited to agree conclusions on Clearing and Settlement covering the ECB’s proposed target 2 securities project, the implementation and functioning of the code of conduct, progress on removal of the Giovannini barriers and the ESCB/CESR standards. These initiatives are intended to address deficiencies in the European clearing and settlement landscape—an area where the Council has long been pressing for change. The UK welcomes progress in addressing these deficiencies.

Financial Services—EU Arrangements for Financial Stability

Ministers will be invited to agree conclusions on the long-running discussion of how to take forward EU arrangements for financial stability. The UK strongly supports efforts to improve financial crisis management arrangements in Europe, and improvements to the financial stability arrangements in general, including ensuring all member states have robust national crisis management arrangements, and improvements to cross border communication and co-operation in financial crises.

The House will want to discuss the events in the international financial markets this summer. To assist this debate, I am making this written statement to set out a summary of what has happened and the action taken in response. I will make an oral statement later this week.

International Financial Markets—Recent Developments

Over recent years, the world economy and global financial markets saw an unprecedented period of stability and prosperity. This has been accompanied by: lower average long-term interest rates in advanced economies than at any time over the previous three decades; low default rates on borrowing; investors seeking higher returns; and lower premiums for riskier lending.

Since late July, global financial markets have suffered disruption and turbulence, triggered initially by problems in the US sub-prime mortgage market. Uncertainty over institutional exposure to potential losses on sub-prime mortgages caused reductions in liquidity across a range of financial markets. This uncertainty has been exacerbated by the fact that assets and liabilities have increasingly been managed off-balance sheet in complex structured investment vehicles and conduits.

In these circumstances, a range of asset-backed securities could no longer be sold or traded. These problems spread to money markets and funding costs increased for banks, with inter-bank lending spreads rising by up to 100 basis points in major financial centres and terms of lending shortened significantly. Bond, equity, commodity and foreign exchange markets around the world were affected as investors lost confidence and a re-pricing of risk began that is still continuing. In this way, even institutions with no direct exposure to sub-prime mortgages have been affected.

These developments have affected economies and institutions across the world. Many banks and funds have suffered losses due to direct exposure to sub-prime mortgages and associated securities. For example, in the US a number of sub-prime mortgage lenders have had severe difficulties and funds holding large quantities of mortgage debt instruments were also affected. In Germany, two banks had to be helped after suffering from similar exposures. Banks elsewhere in Europe suspended the activities of funds after exposure to sub-prime products left them unable to value them appropriately. Funds in other countries, including Australia and Canada, have also been affected.

Impact on the Financial Sector

The UK entered the recent period of turbulence in the global financial markets in a strong position. The UK economy has seen 60 quarters of growth—the longest and most stable period of growth since records began—and is expected to continue to grow.

Moreover, the banking sector in the UK has benefited from a period of strong growth which helped it build up healthy balance sheets and capital positions. Most major UK banks reported good profit results for the 2006 financial year and continued to report increases in pre-tax profits in their interim results for the first half of 2007. Throughout this period of growth and stability, the Financial Services Authority (FSA) continued to set capital requirements for all banks above the minima required by EU law and international standards.

Direct exposures in the UK to losses from sub-prime mortgages have been less significant than in some other countries. However, because of the broader impact of the turbulence on global markets, some financial institutions have found themselves under funding pressure due to the seizing up of asset-backed commercial paper markets and the drying up of liquidity in the inter-bank markets.

Northern Rock Plc

Northern Rock Plc faced specific difficulties in these circumstances. Its recent problems were not caused by direct exposure to sub-prime mortgages in the US or the UK: indeed, it has a good quality loan book. Rather, its problems have been associated with wider conditions in the wholesale funding markets. The market for new securitisations had largely closed as investors’ demand for such assets fell across the world. Furthermore, the market conditions in August and September resulted in liquidity in the wholesale money markets drying up, with a shortening of duration of funding and an increase in its cost. The combination of these factors contributed to serious liquidity problems for Northern Rock Plc.

Following advice from the Governor of the Bank of England and the chairman of the FSA that the position of Northern Rock Plc, given market conditions at that time, constituted a genuine threat to the stability of the financial system, I concluded that it was appropriate and necessary for the Bank of England to provide liquidity support to Northern Rock Plc. Northern Rock Plc issued a profit warning on 14 September. At the same time, the authorities issued a statement about the provision of a special liquidity facility to Northern Rock Plc.

On 17 September, to put the matter of security of deposits beyond doubt, I announced that, should it be necessary, the Government, with the Bank of England, would put in place arrangements that would guarantee all the existing deposits in Northern Rock Plc during the current instability in the financial markets.

Throughout this period the Treasury, the FSA and the Bank of England have worked together, and, as appropriate, with Northern Rock Plc, in line with their respective responsibilities, and continue to do so.

Reforms

Global issues demand global responses, so the Government are working closely with their partners in the EU and internationally to ensure a coordinated international approach to financial market developments over the last two months. I made proposals to EU finance ministers that we must remain fully engaged, acting with the wider international community, in strengthening arrangements for ensuring financial stability. I will also be making proposals at the meetings of the G7 and International Monetary Fund next week on the international response.

The UK has a system of depositor protection based on the Financial Services Compensation Scheme (FSCS). Under the previous scheme only the first £2,000 of people’s savings and 90 per cent. of the next £33,000 were guaranteed. As a first step in improving the level of protection for depositors, the FSA has decided that, with effect from 1 October, the FSCS will cover 100 per cent of deposits up to £35,000.

We must learn the lessons from recent events and reinforce our systems appropriately to meet our objectives of maintaining financial stability, competitiveness and confidence. I will therefore make a statement later this week bringing forward proposals on further reforms to give consumers confidence that their savings and deposits are accessible, safe and secure, and to handle banks facing difficulties.

We will balance any need to make improvements as quickly as we reasonably can with the need to consult as fully as possible. Financial sector regulation will remain effective, proportionate and risk-based, protecting investors and consumers appropriately and ensuring market integrity whilst encouraging innovation and keeping pace with market developments.

I am making a preliminary announcement of how £21.7 billion capital will be invested in schools between 2008 and 2011. This is investment for buildings and ICT allocated to the Department for Children, Schools and Families as part of the Comprehensive Spending Review 2007.

Good facilities where young people can learn and grow are a vital foundation for a good education. The report “Better Buildings, Better Design, Better Education” (DfES, 2007) showed that the Government’s investment programme has already made a difference for pupils around the country. Since1997, over 1,100 schools have been built new or rebuilt, 27,000 classrooms built or improved, and thousands more schools have had real improvements to science laboratories, sports facilities and other building and ICT projects. In 2007-08, around 180 schools will be built new or rebuilt, including the first through “Building Schools for the Future”.

The programmes for 2008-11 will drive our modernisation programme still further and faster. Investment will be £6,669 million in 2008-09, £7,024 million in 2009-10 and £8,035 million in 2010-11. Investment by 2010-11 will be seven times higher in real terms than in 1996-97. We are continuing the successful balance of programmes, established in 2004. These are: devolved programmes for every school and local authority; our long-term strategic programmes for primary and secondary education; and targeted programmes for key national investment priorities. I will make a further statement next week to set out the detailed allocations against each of these programmes.

Information and Communication Technology Funding

Most capital programmes can be used to invest in technology equipment. However, given its importance, there will be £837 million over three years specifically for ICT. Within this figure, I am introducing a new harnessing technology grant worth £603 million over three years. This grant replaces the previous disparate grants for technology. It allows schools, and local authorities on their behalf, to invest to meet local priorities in line with the objectives of the Department’s e-strategy. There will be further announcements on the remaining ICT funding.

This year, enterprise week runs from 12 to18 November. It is the annual focal point of the “Make Your Mark” campaign—which aims to inspire young people (aged 14-30 years) to be enterprising in the broadest sense, developing a creative, can-do attitude with the skills to spot opportunities and the confidence to pursue them. This is crucial for the future aspirations of millions of young people as well as the economic future of the UK—encouraging business start-ups, social enterprises and development of an enterprising workforce. Wednesday 14 November will be Women’s Enterprise Day and Thursday 15 November will be Social Enterprise Day.

This is not simply about encouraging business start-ups and entrepreneurship. The campaign also encourages organisations across the UK to take the opportunity of Enterprise Week to celebrate and recognise the wealth of talent that is evident in every business and to encourage their employees to start thinking about ideas that have a very clear and tangible business benefit.

“Make Your Mark” is funded by the Department for Business, Enterprise and Regulatory Reform and is led by Enterprise Insight—a campaign coalition founded by the UK’s leading business organisations (CBI, British Chambers of Commerce, Institute of Directors, and the Federation of Small Businesses) in partnership with the main enterprise development organisations and working closely with Government Departments, education bodies, Regional Development Agencies and others.

Last year, Enterprise Week generated very large community interest in entrepreneurship. 448,000 people attended the 3,184 events run by 1,410 organisations. Over 20,000 people in 3,704 teams from schools, colleges and workplaces competed simultaneously around the UK in the Make Your Mark Challenge—the week’s largest single event. Over 15 per cent. of events were in colleges and universities and social enterprise had a particularly high profile, featuring in over 10 per cent. of all events and media coverage.

Enterprise Week 2007 is expected to be even bigger but it needs Members’ continued support. Members are urged to look at the campaign website: www.makeyourmark.org.uk and consider how the campaign can benefit their constituencies. Active support of Enterprise Week events taking place in constituencies and encouraging the organisations that are running them to register details of their event on the database at: www.enterpriseweek.org will help to ensure that this is the biggest Enterprise Week yet.

I am today announcing the initial results of a review for the location of the UK Hydrographic Office (UKHO).

The UKHO and Met Office have carried out an analysis of the benefits and costs of co-location with the Met Office at Exeter, compared to the other option of developing a new facility in Taunton.

The conclusion of this work is that it is not cost effective to move the UKHO’s 900 strong office workforce to Exeter, and in addition any such move would cause substantial disruption to both organisations.

I therefore confirm that the UKHO will remain in the Taunton area and that further work is on going to determine detailed options for the office.

The amount of low flying training carried out in the UK Low Flying System (UKLFS) during the training year April 2006 to March 2007 was the minimum required for aircrew to reach and maintain their ability to fly at low level. The number of low flying training hours booked in the UKLFS (excluding the rotary wing dedicated user areas, where different booking arrangements apply) was 37,717 hours, a decrease of 6,713 (15 per cent.) hours in comparison with the previous training year. This decrease can be mostly attributed to the high level of operational deployments and immediate training requirements for operations in the close air support role being undertaken at medium level rather than low level. Low flying hours have also reduced from aircraft retiring from service. The level of operational low flying by fixed wing aircraft reduced by some 6 per cent. when compared to the last training year.

The Ministry of Defence is committed to ensuring that low flying training across the UK is spread as widely as is practically possible across the UK so that no single area is too burdened. However, due to a variety of reasons, population distribution and geographical and climate restrictions, it is unavoidable that some areas of the country may experience more activity than others.

I have today placed in the Library of the House a report giving a detailed account of the low flying training that has taken place in the UK Low Flying System for the training year April 2006 to March 2007.

Additional copies of “The Pattern of Military Low Flying Across the UK 2006/07” are available on request from the following address:

Directorate of Air Staff

Complaints and Enquiries Unit

Ministry of Defence

Level 5 Zone H

Main Building

Whitehall

London

SW1A2HB

Alternatively it can be viewed on the MoD’s website at:

http://www.mod.uk/DefenceInternet/AboutDefence/WhatWeDo/AirSafetyandAviation/LowFlying

I wish to announce today plans to restructure the Royal Electrical and Mechanical Engineers (REME) as part of the on-going implementation of the Future Army Structure.

In line with the Defence Logistics Transformation Programme, the Off Platform Repair Capability, which provides intricate repairs from a semi-permanent location, will be aggregated into two Off Platform Repair Companies. These sub-units, together with those assigned to the Logistic Brigades, will come under the command of two Territorial Army (TA) Battalions—101 and 104 Battalion REME.

The battalions will be re-titled 101 and 104 ‘Force Support Battalions REME’ to reflect their increased role. Their present affiliations remain extant. The overall size of the TA is not affected.

While this entails integrating regular companies into battalions that were previously TA, it does not set precedents—elements of the Royal Military Police are similarly structured. Command will be exercised by a Regular Commanding Officer, although sufficient REME reserve command opportunities will still exist elsewhere.

These changes will be effective from 1 April 2008.

I would like to make a written statement on this summer’s outbreak of Foot and Mouth Disease in Surrey and on Bluetongue. This gives further detail and background to my oral statement of today.

On 3 August Foot and Mouth Disease was confirmed on a cattle farm in Surrey. In line with the contingency plan, control measures including a national ban on the movement of susceptible animals were put in place immediately.

DEFRA, Animal Health, local authorities, the voluntary sector and other partners across government, alongside the farming community, have worked hard to control and eradicate the disease. Working with the leaders of the farming and food chain industries, we have been able to identify welfare pressures, and on a risk basis allowed animal movements to take place under strict biosecurity conditions.

By 4 August we were able to confirm the strain of the virus as 01-BFS-67. As this strain was not currently circulating in animals, this pointed to the Pirbright laboratory site as a potential source of the outbreak. Therefore, I commissioned the Health and Safety Executive to investigate the potential release from the site, and Professor Brian Spratt to lead a team of experts in a review of biosecurity arrangements.

On 7 September we published the investigation report from the HSE, the review report by Professor Brian Spratt, and the epidemiological report from the National Emergency Epidemiology Group in DEFRA. I have place copies of all these reports in the House Library. They all concluded that the cause of the outbreak was almost certainly the escape of live virus from the Pirbright facility. As the House will be aware there are three parties on the Pirbright site all of which are known to have been using the 01-BFS-67 strain during the period when infection was most likely to have occurred—the Institute for Animal Health, a research institute sponsored and grant aided by the Biotechnology and Biological Science Research Council which also owns the land and buildings on the site; and two private companies Merial Animal Health Limited, and Stabilitech.

It cannot be said with complete certainty how the virus escaped from the Pirbright site. However, the reports concluded that the most likely route was accidental release from the drainage system that connects the vaccine production plant to the waste inactivation facility on another part of the site. It is thought that localised flooding alongside construction work may have resulted in effluent escaping from the system coming to the surface, and being transferred on the site.

Whatever the route of escape, it should not have happened and we are determined that it does not happen again. I have accepted all of the recommendations in the reports from the HSE and Professor Spratt, and I have called for a review of the regulatory framework for animal pathogens led by Sir Bill Callaghan. In addition a safety alert has been issued jointly by DEFRA and the HSE to the Advisory Committee on Dangerous Pathogens and all animal pathogen category 3 and 4 laboratories, reminding licence holders of their responsibilities. This will be followed by a round of inspections. A rigorous improvement plan has been developed for both Merial, and IAH to be implemented before full operations with live virus can re-commence. In addition a review led by BBSRC is assessing the funding, governance and risk management at IAH. I will keep the House informed of progress with both these reviews.

Epidemiological investigations began immediately when disease was confirmed and indicated that it was highly unlikely that the virus had spread outside of the Surrey area. Under long standing international rules and European Union procedures, zone restrictions must stay in place for at least 30 days after preliminary cleansing and disinfection on the last infected premises and the completion of certain surveillance activity. We observed these procedures and carried out intensive surveillance going beyond Community rules in the area. Given that only two cases had been confirmed (on 3 and 6 August) we proceeded to lift the Surveillance Zone on the 8 September and with the unanimous support of the Commission and member states, trade restrictions were lifted.

Unfortunately, as we now know, there was undetected infection outside the surveillance zone. On 12 September following an investigation by Animal Health, Foot and Mouth Disease was confirmed in a third case in Surrey, and controls were re-imposed.

On 25 September we created two FMD areas in Great Britain, a risk area in the south-east and a lower risk area in the rest of the country where farm to farm movements were permitted under licence. We have subsequently reduced the size of the FMD risk area and will continue to do so based on veterinary risk. On 4 October markets in the low risk area were able to start operating again under stringent biosecurity measures. I visited Skipton market last Thursday and was able to see the difference this will make to the farming industry.

On 3 October the EU confirmed that the export of meat could resume from this Friday (12 October) from Scotland, Wales, and the north and south west of England. This is very welcome news for the farming and food chain industries. We will continue to work with the Commission to increase the areas from which exports can happen.

The outbreak and its continuation has been a tremendous blow to the farming industry, especially given the time of year when the majority of livestock farmers need to move their animals and generate income. The economic impact of this outbreak on the farming community has been very significant and we have listened to the views of industry to take steps to alleviate economic and welfare pressures where ever possible. Indeed, working in partnership with the farming community has been an integral part of our approach to responding to this outbreak.

I am acutely aware of the major challenges facing the livestock sector at this critical time of year. Officials are working very closely with the industry in facilitating the resumption of animal movements on a risk basis to ensure as far as possible the normal working of the industry. The measures we have taken to ease restrictions in the low risk area through farm to farm movements and opening markets have helped and the resumption of exports of meat will be of further assistance not just to those whose products are exported but to the market overall.

As if an outbreak of Foot and Mouth was not enough, on Saturday 22 September the first case of bluetongue was found in East Anglia. This disease affects mainly cattle and sheep and is the same strain which has affected much of North Europe since last summer. Intensive surveillance was carried out to determine whether this and the subsequent four cases were isolated incidents which could be controlled by culling.

On Friday 28 September the increase in cases indicated that the disease was circulating in our midge population and the Deputy Chief Veterinary Officer confirmed the presence on bluetongue in Great Britain.

Bluetongue is very different from FMD. It is spread by midges, rather than animal to animal, and we cannot stamp it out by slaughtering infected cases. However, we may be able to limit its spread. The cases we have seen so far are in a limited geographical area and seem to result from a single incursion which took place in August when FMD movement controls were in place.

Midge activity should diminish significantly next month, which may halt further spread—at least for the winter. We have therefore consulted a group of stakeholders from the sectors affected and they have agreed that for the time being we should apply the control and protection zone measures to clamp down on further spread.

A clear understanding of the spread of the disease is now crucial to help the industry, with the support of government, to plan what may happen and what the appropriate response would be. That requires farmers in the zones to be vigilant and, for the sake of their industry, to report all new cases, so that we can monitor whether spread is occurring.

Over the coming weeks, the decision on whether to continue this approach will be kept under review with stakeholders. If disease becomes more widespread, our control strategy sets out that we would consider, with the farming industry, extending the bluetongue zones to a larger area. This is a difficult balance between permitting movements across a greater distance but also potentially increasing the risk of further disease spread. I recognise the hardship these controls impose in East Anglia. Our aim is to help implement the control strategy that industry representatives themselves recommend to us. The effects of bluetongue movement controls mean that it is vital that disease control decisions are taken by the industry and not just Ministers. In the longer term, we are also urgently planning with the industry how we could implement a vaccination programme should a vaccine becomes available.

The speed, commitment and professionalism of all those who have responded to these outbreaks has been remarkable, and I am sure the House will join me in expressing thanks for their efforts. The House will also understand the very real pressures faced by the farming community and the distress that this has caused.

I will keep the House updated on progress regarding the control and eradication of both FMD and the control of bluetongue.

My noble Friend Lord Rooker announced on 19 September 2007 that the new levy board, which will replace the existing five agricultural and horticultural levy boards on 1 April 2008, will be called the Agriculture and Horticulture Development Board.

Lord Rooker also announced on the same date that the Agriculture and Horticulture Development Board (AHDB), and its sector companies, would be located at a new site at Stoneleigh, Warwickshire from April 2009. The decision to move to Stoneleigh was recommended to DEFRA Ministers, and to ministerial colleagues in the Devolved Administrations, by the shadow board of AHDB.

A business case demonstrating the financial benefits of locating the levy board and its subsidiary companies together at Stoneleigh has been published on the DEFRA website and copies were laid in the Library of the House on 19 September.

The whole country will have been deeply disturbed by recent events in Burma. The brutal suppression of peaceful pro-democracy demonstrations across the country, including beatings, killings and arbitrary detentions of monks and civilians, has been deplorable. The Government are committed to working with all international partners in the search for an inclusive political process to bring reform in Burma.

Historical background

The human rights situation in Burma has long been a cause for concern. The military has ruled Burma since 1962. In 1988, pro-democracy demonstrations were violently suppressed by the military. Multi-party elections in 1990 were overwhelmingly won by Daw Aung San Suu Kyi's National League for Democracy. However, the military regime refused to implement these results.

Aung San Suu Kyi has remained under house arrest since she and her supporters were attacked in May 2003. The 1991 Nobel Peace Prize winner has spent 12 out of the last 17 years under house arrest.

The military regime continues to rule by decree and controls every aspect of society. It severely restricts freedom of expression, information, assembly and movement. Members of opposition parties are subject to harassment, arbitrary arrest and detention. Before the recent demonstrations there were already some 1,100 political prisoners in Burma. Forced labour, arbitrary killings, the use of child soldiers and systematic rape, unlawful detention and displacement have all been commonplace.

The human rights situation deteriorated in 2006 with further harassment of political opposition and attacks on ethnic groups.

Recent Developments

In the middle of August popular protests began against rises in fuel prices of up to 500 per cent.—a measure that had severe implications for the already impoverished Burmese people. The protests were swiftly followed by arrests of pro-democracy activists. The UK condemned the actions of the regime and called for the immediate release of those detained. I expressed the UK's solidarity with the protesters and warned the regime that it would be judged by how it responded to this peaceful movement.

In late September the demonstrations grew rapidly in size, led by large numbers of Buddhist monks. These demonstrations were peaceful and orderly. On 20 September Professor Ibrahim Gambari, the Special Representative of the UN Secretary General, briefed the UN Security Council in informal session, a development which I welcomed publicly, while expressing concern for the peaceful demonstrators. On 22 September demonstrators were permitted to walk past the house in which Aung San Suu Kyi is being held under house arrest. As the crisis developed, the Prime Minister and I issued a number of statements and spoke to many of our international counterparts urging against repression and calling for reconciliation. After the Prime Minister had written to the UN Secretary General and the President of the EU expressing concern, the EU issued a statement on 25 September warning that it would not hesitate to impose strengthened measures against the Burmese regime if they resorted to violence; and there were further informal Security Council discussions on 26 September.

As we now know, the response of the regime—which it tried, unsuccessfully, to hide from the outside world - was one of violence and brutality. The security forces turned their guns on unarmed demonstrators. We do not know for certain how many people were killed but we fear it is many more than the regime has admitted. Monks and opposition leaders have been beaten and arrested. Many remain in detention and reports suggest that they are being held in appalling conditions. Through the indiscriminate use of force, the regime has suppressed the protests and forced people off the streets.

The crisis is continuing in Burma. There are a number of urgent questions the regime must answer. They must provide precise information on those who have been killed or injured; and on those who have been detained—their identities, whereabouts, and the conditions in which they are being held. The regime must immediately accede to the requests for urgent access for the Head of the International Committee of the Red Cross (ICRC) and the UN Special Rapporteur on Human Rights in Burma, Professor Pinheiro. And they must engage with Ambassador Gambari in developing an inclusive political process for reform.

UK action since crisis began

UK action has focused on three specific areas.

First, the UK has been working actively with the international community, and with Burma's neighbours in particular, to put pressure on the regime to end the violence, release political detainees, including those arrested for peacefully expressing their views in the recent protests, ensure full respect for human rights and work towards genuine reconciliation with all the relevant political and ethnic parties in Burma. This work remains a high priority for the Prime Minister, the Foreign Secretary, other FCO Ministers and the entire diplomatic network.

Second, we have been pursuing urgent action in the United Nations. The UK pressed for the Security Council discussions that took place on 20 and 26 September and most recently, in formal session, on 5 October, and we pressed for the visit by Professor Gambari, to Burma to meet with Aung San Suu Kyi and the military leaders. We look forward to a return visit by Ambassador Gambari.

The UK also pushed hard for a Special Session of the UN Human Rights Council in Geneva, which, with strong UK involvement and support, passed a Resolution on 2 October deploring the violent repression of peaceful demonstrators and agreeing to send the Special Rapporteur on Human Rights, Professor Pinheiro, on an urgent mission to Burma to report on the human rights situation

Third, with our EU partners we have been working to strengthen sanctions against the regime. This will continue over the next week in the run up to the General Affairs Council on 15 October.

Future direction

We have three clear objectives, building on the work we have already been doing. The Prime Minister re-emphasised these objectives when he met Burma activists on Saturday 6 October—the day of global action on Burma.

First, the international spotlight must be kept firmly on Burma. We will continue to highlight the appalling recent events in Burma and use our diplomatic network to keep our international partners focussed on the need to address urgently the ongoing human rights abuses there. On 6 October the Prime Minister drew attention to a compilation of material by FCO officials, drawing together information on recent human rights violations in Burma from media, eyewitness and diplomatic sources. This can be found on the front page of the FCO Website: http://www.fco.gov.uk

Second, the regime must understand that it cannot turn the clock back to the dire situation before the recent demonstrations. We welcomed Professor Gambari's clear statement on 5 October that the status quo ante was both unacceptable and unsustainable. Recent events have demonstrated clearly that this would pose unacceptable risks to Burma's long-suffering population and to the region.

At its meeting on 5 October, members of the United Nations Security Council sent a clear signal that a process of national reconciliation leading to democracy, full respect for human rights and the rule of law is the only way forward. That process must involve Aung San Suu Kyi and leaders of the democratic opposition and ethnic groups. And it will need to have international legitimacy. We continue to support urgent and active UN engagement to pursue such a process, and are pressing for an early return visit by Professor Gambari to Burma.

Third, we will galvanise and mobilise international support to put pressure on the regime. In addition to further engagement by the UN Security Council and the UN Secretary General, we also need all those with influence on the regime to use it to press for positive change. China and other key nations such as Thailand and India can play a crucial role. We appreciate the efforts China has already made in support of Professor Gambari's recent visit to Burma and we hope China will continue to use its influence on the regime to push for genuine dialogue with the political opposition. My recent meetings with Foreign Ministers of all three countries have provided the opportunity to explain the priority we give to this issue.

We expect the European Union General Affairs and External Relations Council to announce a package of tougher measures against Burma on 15 October. We will push for these to include a ban on future investment, on top of the sanctions against individuals and their assets and measures aimed at specific commodities. These will be designed to have the greatest impact on those whose behaviour we are trying to change - the regime and those that benefit from their policies.

Support for the people of Burma

If the Burmese regime changes course and shows it is willing genuinely to work for reconciliation, democracy and poverty reduction, an economic package involving the UN, International Financial Institutions and bilateral donors could be offered. This could include the establishment of a multi-donor Trust Fund to support health, education and other key sectors; support for debt relief; financial and technical support for democratic elections; an investment conference to attract foreign direct investment; trade measures to facilitate Burma's entry into the global trading system, support for civil society including the development of a free media as well as continued humanitarian relief

Meanwhile, in response to PM's discussion with the activists he met on 6 October, the UK has announced an additional £1 million to meet the urgent humanitarian needs in Burma arising from this latest episode of gross misrule. This will help ensure that vulnerable people do not suffer because of the actions of the regime.

Today we have laid before Parliament the Government response to the Joint Committee’s report on the Human Tissue and Embryos (Draft) Bill (Cm 7209).

On 17 May 2007, the Government published draft legislation to revise and update the Human Fertilisation and Embryology Act 1990. This was set out in the Human Tissue and Embryos (Draft) Bill.

The Government welcomed the establishment of a joint committee of both Houses to undertake pre-legislative scrutiny. The Government are grateful for the Committee’s report and have accepted several of the key recommendations. We believe that an improved Bill will result from this process.

The Command Paper sets out the Government’s response to all 31 recommendations and is available in the Library.

The scheme administrators have identified shortcomings with the administration of the NHS Injury Benefits Scheme since 1972. The review identified that:

between 1985 and 1998 in some cases the incorrect eligibility criteria has been used;

since 1972 injury benefits have been inappropriately adjusted to take account of changes in the rate of DWP benefits; and

since 2002 some decisions have been made without appropriate legal authority.

The Pensions Division of the NHS Business Services Authority have instituted corrective action and all those known to be affected will be notified that their claims will be reviewed. People who have been underpaid will receive the money they are due and those who have been overpaid will not be expected to pay the money back. Once corrections have been made to known cases, an advertising campaign will be undertaken to identify individuals who may have been inappropriately advised against making claims.

The Government take very seriously the difficulties that have been identified with the administration of the NHS Injury Benefit Scheme over many years. They support the action of the scheme administrators in identifying the historic issues and in undertaking corrective action.

Sir John Tooke announced the results of his inquiry into Modernising Medical Careers (MMC) this morning. We would like to thank Sir John Tooke and his review group for investing so much time and expertise in providing recommendations for the future of medical training for 2009 and beyond. We will consider Sir John’s findings carefully.

Recruitment to Medical Training in 2008

Following a discussion document and feedback from stakeholders, the new MMC programme board, whose members include the British Medical Association, the Academy of Royal Colleges and NHS Employers, has recommended changes to junior doctor training and recruitment for 2008. We have accepted its recommendations which are as follows:

recruitment and selection will be run by local processes that are very similar to the second round of recruitment this year and recruitment in previous years. It will be run locally by deaneries, who will advertise for their own posts and use their own application forms, shortlisting criteria and scoring systems. They will also interview, select, and make offers;

a short set of national principles, similar to those used for the second round of recruitment this year, will provide a policy framework for the local processes of recruitment in 2008;

recruitment for a number of specialties will be run nationally where there are well-tested, successful national processes of recruitment. These include General Practice and Obstetrics and Gynaecology;

there will be more than one entry point into speciality training each year with start dates at different points throughout the year;

there will not be a national IT system for applications to training for hospital specialities in 2008. Work will continue on developing the national IT system for use in 2009. National IT systems will continue to be used for the Foundation Programme and GP recruitment; and

there will be pilots of selection centres and invigilated, machine markable tests for shortlisting for entry level posts (Specialist Training Level 1).

Recruitment to Medical Training in 2007.

The previously announced employment guarantee covers the period 1 August to 31 October while doctors continue to compete for posts in round 2 of this year’s recruitment. There are about 1,000 additional training posts being created for the end of round 2 as a transitional safety net for junior doctors. The transitional training posts will be filled in November and December. We have therefore decided to extend the employment guarantee to 31 December 2007, when recruitment to the transition training posts will have been completed.

MTAS Security Investigation

Following the security breach on 25 April further investigations have indicated that the personal data were accessed by a user accessing the information through the Imperial College London network. The Department understood that a continuing police investigation would result in serious invasive actions into Channel 4 and Imperial College and constitute a disproportionate response. The college has volunteered its complete co-operation in the matter. It has been supplied with the evidence and is carrying out its own investigations into the conduct of the user. The college has assured the Department that it is treating this as a serious issue and dealing with it in a proportionate and appropriate manner. Consequently, the police are taking no further action at this time.

International Medical Graduates

A consultation to help formulate policy on the place of international medical graduates (IMGs) in recruitment to specialist training for 2008 has been launched today. The consultation has been placed in the Library.

A set of principles and high level indicators for Adult Mental Health Medium Secure Services was published by the Department in August 2007 and has been placed in the Library. A summary document is available to hon. Members in the Vote Office.

This set of documents provides best practice guidance to support the process of commissioning safe and clinically appropriate adult medium secure services across the NHS and Independent Sector. The principles are supported by high level indicators which commissioners can use to describe to providers the standard of security and care they wish to commission. The documents have been developed with the assistance of specialised commissioners and are supported by the Royal College of Psychiatrists.

This documentation defines and clearly describes what a medium secure service should provide in terms of care and the appropriate security standards. Issuing a national set of principles for Medium Secure Services should substantially strengthen the commissioning function.

Modernising mental health services remains one of this Government’s core national priorities. Medium secure mental health services are a key element of the forensic mental health system. For patients, these services are an important part of an integrated pathway, when they need care and treatment in a secure environment. The number of patients who will need this sort of treatment is only a small proportion of patients with mental health problems. However, it is essential for those who do need this treatment that they receive compassionate, beneficial and safe services.

I am today announcing changes to juxtaposed control zones for the new Eurostar Terminals at St. Pancras and Ebbsfleet International. Juxtaposed controls have been highly successful in reducing the dangerous and illegal crossing of the Channel. The changes in location of the control zone from Waterloo to St. Pancras and a new zone at Ebbsfleet International will take place when Eurostar moves its operations in November. In line with the Government’s strategic objective to strengthen our borders, this will allow us to continue work jointly with our French and Belgian partners to protect our borders against the threats from illegal immigration.

The Sangatte Protocol 1991 and the Additional Protocol to the Sangatte Protocol 2000, given effect by the Channel Tunnel (International Arrangements) Order 1993, provide the basis for juxtaposed controls at Eurostar terminals for trains travelling between France and the UK. A tripartite agreement between France, Belgium and the UK of 1993, a protocol to that agreement and administrative arrangements made pursuant to that instrument in 2004 provide the basis for juxtaposed controls in respect of trains travelling between Belgium and the UK (via France) via the channel tunnel. These are given effect by the Channel Tunnel (Miscellaneous Provisions) Order 1994. Secondary legislation is to be laid before Parliament to make the necessary provision for the new control zones at St Pancras and Ebbsfleet International and to remove the control zone at Waterloo International. Copies of the amended international agreements will be available in the House Libraries.

The Office of the UN High Commissioner for Refugees (UNHCR) has an essential role to play in delivering protection and assistance to refugees, ensuring an effective response to the needs of people displaced from their homes by conflict, and finding and promoting durable solutions to their plight.

DFID has agreed a joint strategy with Canada and Denmark to support UNHCR over 2007 to 2009. The strategy supports UNHCR's corporate objectives and highlights five strategic priorities: emergency response and preparedness; durable solutions; Internally Displaced Persons (IDPs); age, gender and diversity; and results-based management and evaluation. This Joint Organisation Strategy (JOS) was designed in consultation with Whitehall colleagues.

DFID will provide UNHCR £19 million core funding in 2007. Progress against the JOS objectives will be monitored through review meetings supplemented by donor missions.

I represented the UK at the EU Development Ministers' Informal Meeting in Madeira on 21-22 September 2007.

The UK contributed to momentum in the right direction on the humanitarian, security and trade agendas, as well as securing support for the PM's MDG Call for Action

Friday 21 September

Improving the EU response to Fragile Situations

The Portuguese Minister for Development, Joao Cravinho and Development Commissioner Louis Michel introduced this item, stressing the need to work differently in fragile contexts and to focus on prevention of violent conflict. The Minister stressed the importance of stability in helping to improve progress towards the Millennium Development Goals (MDGs). Picking up this point, I asked for support for the Prime Minister's Call for Action on the MDGs. In this context and others, the initiative was favourably received. In relation to dealing with fragility, along with some other Ministers, I stressed the importance of basing plans on the OECD Development Assistance Committee guidelines. I advocated the importance of learning lessons from experience with new instruments developed to fit fragile contexts, such as multi-donor Trust Funds.

Security and Development

The Portuguese Defence Minister (a former Development Minister), Mr Nuno Severiano Teixeira, gave a presentation on improving coherence between development and security policies. While recognising the challenges of differing time-scales and priorities, he advocated closer working, including shared management of resources and cross-departmental teams. I was able to share the positive experience of the UK with the cross-departmental Conflict Pools and Post-Conflict Reconstruction Unit. A number of Member States mentioned concerns about potential diversion of official development assistance to cover “military” expenditure. Italy is in the process of passing a new development law which should provide better protection than at present. I spoke about the UK's International Development Act in this regard. I drew attention to the importance of building capacity in the UN and the African Union for effective peace-building as well as peace-keeping. I also reminded participants of the importance of the Arms Trade Treaty.

Humanitarian Aid

Minister Cravinho introduced this item on behalf of the Presidency, which aims to have an EU Humanitarian Consensus to match the 2005 Development Consensus as a commitment to best practice. While acknowledging the value of the Consensus and the good work of ECHO, I pressed for much stronger acknowledgement of the pre-eminence of the UN in co-ordination of responses to humanitarian crises and a clearer commitment to the UN's Central Emergency Response Fund. I drew attention to the importance of the humanitarian principles of neutrality, impartiality and independence where military or armed police personnel and equipment were deployed.

International Development Architecture

The UN High Commissioner for Refugees, Antonio Gutierres, a former Prime Minister of Portugal, gave a presentation encouraging Europe to take a leading role as a “rational centre” in the global development scene, pushing for co-ordination. He acknowledged the importance of UN reform and pointed to the limitations of the International Financial Institutions. In his view three of the main challenges facing the international community were security, migration and climate change.

Saturday 22 September

Economic Partnership Agreements (EPAs):

Trade Commissioner Peter Mandelson opened the discussion of Economic Partnership Agreements amongst EU Development Ministers. He painted a mixed picture of progress. He highlighted the unprecedented generosity of the EU's offer to the African, Caribbean and Pacific partner countries, most recently with new Rules of Origin. He advised Ministers not to heed calls to extend the deadline for deals, arguing that it would be illegal under WTO rules. I acknowledged the generosity of the offer, while suggesting that even more liberal Rules of Origin could help the negotiations. A goods-only “framework” EPA offered the best prospects for breaking deadlock. Along with other Ministers, I stressed that the ACP must not be left worse off if it proved impossible to reach a deal.

On 12 July I announced a review of restraint in juvenile secure settings in the House and, on 26 July, I set out the broad terms of reference for the review. The Ministry of Justice and the Department for Children, Schools and Families have joint responsibility for the review. My right hon. Friend the Member for Stretford and Urmston (Beverley Hughes) is the lead Minister for DCSF.

My right hon. Friend and I are pleased to announce that we have appointed Andrew Williamson CBE and Peter Smallridge CBE as independent joint chairs of the review.

This is a very important and sensitive review and we warmly welcome the skills and experience that Mr. Williamson and Mr. Smallridge will bring to it. They have strong backgrounds in management in the public sector, having both been Directors of Social Services in large local authorities where they had responsibilities both for services for children and for secure provision. More recently they have been involved in the NHS, where they currently both chair NHS Trusts. They both have considerable experience of participating in and chairing reviews in the NHS and in Social Services. They also have a track record of working together at many levels, including joint working for the Department for International Development in developing child protection services in Eastern Europe.

The chairs will be considering whether any further issues should be brought within the broad terms of reference of the review and will decide soon the process for calling for evidence and for consulting with interested parties. We know that the chairs wish the review to be open and transparent and they are expecting to consult widely.

My right hon. Friend and I have asked the chairs to report to Ministers within six months of the date of this announcement.

The Constitutional Reform Act 2005 makes provision for a new appointments process for Justices of the United Kingdom Supreme Court. The Act brings these provisions into effect once the Court is operational. The new arrangements aim to increase public confidence in the appointments process by creating greater transparency of appointments and improving competition for these positions. I believe that it is sensible to adopt the new process from now on. This is because those newly appointed to the Appellate Committee of the House of Lords will spend the majority of their career in the Supreme Court.

I will therefore adopt Section 8 of the Constitutional Reform Act on a voluntary basis, as any new appointments made will help to determine the character of the Court. This decision does not impact upon other provisions within the Act that will come into force when the Supreme Court opens for business in October 2009.

A selection commission will be formed when vacancies arise. This will be composed of the President and Deputy President of the Supreme Court and members of the appointment bodies for England, Wales, Scotland and Northern Ireland. All new judges appointed to the Supreme Court after its creation will not be Members of the House of Lords; they will become Justices of the Supreme Court.

Land Registry will today launch a formal consultation exercise to seek views on proposals to amend the Land Registration Rules 2003, (with consequent amendments to the Commonhold (Land Registration) Rules 2004) following its first comprehensive review of the existing Rules which came into force on 13 October 2003. Copies of the consultation document have been placed in the Libraries of both Houses. It is also available on the internet at http://www.consultations.landregistry. gov.uk/inovem/consult.ti/system/listConsultations?type =0

The proposals are intended to improve and simplify practice for the benefit of customers and, where possible, reduce the administrative burden on those customers. Many of the proposed amendments relate to existing Rules and practice but some are new. There are proposals aimed at helping the fight against fraud, including obtaining confirmation as to the identity of the parties to a transfer, lease or charge (mortgage).

The proposals reflect Land Registry's desire to create the best conveyancing and land registration system possible and to develop legislation, processes and practices that meet the needs of both property professionals and property owners.

Subject to the outcome of the proposals, the advice and assistance of the Rule Committee and the completion of the necessary amendments to the Rules, it is anticipated that the changes would come into force in November 2008.

On 24 September 2007, I deposited copies of “The Freedom of Information Act 2000 -Statistics on implementation in central Government. Q2 - April – June” in the Libraries of both Houses. Copies are also available in the Vote Office and the Printed Paper Office.

This is the Quarterly Monitoring Statistics Report analysing the performance of central Government in the third full year of Freedom of Information.

I have today placed in both Libraries of the House papers relating to decisions that have been taken during the period 25 April - 5 May 2007 which relate to the North/South Implementation Bodies and Tourism Ireland Ltd under the terms of the Exchange of Notes of 19 November 2002 (Cmnd 5708).

I have today published the Criminal Injuries Compensation Appeals Panel combined Corporate Plan (2007-2010) and Business Plan (2007-08). The Corporate Plan sets out the long-term strategic goals for the Panel over the three-year period and the Business Plan sets out the Panel's key objectives and performance targets for the coming year.

Copies have been placed in the Libraries of both Houses.

I attended the transport session of the Transport, Telecommunications and Energy Council, held in Luxembourg on 2 October. The Portuguese Minister for Public Works, Transport, and Communications, Mr Mario Lino, was in the chair.

At the June Council, Transport Ministers agreed a Resolution calling on the Commission to submit proposals on ways to take forward the Galileo satellite navigation programme, following acknowledgement by that Council that the PPP process had failed. Accordingly, on 19 September the Commission issued a Communication dealing with costs, risks, procurement and governance, together with a proposal for amendment of the Galileo financing regulation and provision for funds to be transferred from the margin available under the Agriculture and Administration budget headings, to fund Galileo in the Competitiveness heading (1A).

With insufficient time for Member States to give detailed consideration to the Communication or to seek the views of national parliaments, discussion on Galileo was confined to an exchange of views. In the exchange, there was wide support for the Galileo project and for reaching an integrated decision by the end of this year. The Council Conclusions reflect these points. In the discussion I made clear the UK's strongly held view that the project should offer value for money for the Community, our opposition to a revision of the financial perspectives, and our firm view that, if the Community decides to proceed with a public procurement of Galileo, any additional funding should be found by reprioritisation within heading 1A.

Following its agreement in principle in June, the Council adopted a Resolution to establish an EU Regional Data Centre for Long Range Identification and Tracking (LRIT) of ships. This will create a single EU system for ship tracking, in line with the requirements of the International Maritime Organisation (IMO). A decision was required prior to the participation of EU Member States in the IMO's Maritime Safety Committee (MSC) meeting, starting on 3 October. I welcomed the establishment of the data centre, while noting some remaining concerns on system integration and cost-sharing. We also presented these concerns in writing. A UK proposal to set up an ad-hoc working group to address these issues was supported by the Presidency, the Commission, and a number of Member States.

The Council reached a general approach on the draft Directive on road infrastructure safety management. The text of the General Approach is acceptable to the UK.

The Council reached a General Approach on each of two proposals on rail interoperability and safety which have been negotiated together. They are a Directive on interoperability of the Community rail system, combining three previous Directives, and a directive amending the 2004 Directive on rail safety. The General Approach texts on these two proposals are acceptable to the UK and successfully deal with our original concerns on establishing a clearer approach as to how the extension to the whole of the Member States rail system will be taken forward.

The Presidency and the Commission reported on the outcome of the 36th Assembly of the International Civil Aviation Organisation (ICAO) in Montreal. The outcome on emissions trading had been disappointing. The Commission wished to examine possible further action, either within ICAO or at the forthcoming UN negotiations in December, and suggested that the Transport Council return to this issue at its November meeting.

The Council adopted a decision giving a mandate for the Commission to open negotiations on a comprehensive aviation agreement with Canada. The terms of the mandate are acceptable to the UK.

The Council adopted Conclusions on the Commission's Communication on “An Action plan for airport capacity, efficiency and safety in Europe”. The Conclusions were acceptable to the UK.

Under AOB, the Commission presented its Green Paper on Urban Transport, entitled “Towards a new culture for urban mobility”. The Commission noted the consultation deadline of 15 March 2008 and the intention to publish an Action Plan in autumn 2008.

I have written to the Chairman of the European Scrutiny Committee, House of Commons and the Chairman of the Select Committee on the European Union, House of Lords detailing the outcome of the session. Copies of these letters have been placed in the Libraries of both Houses.

The policy of transferring to local highway authorities the responsibility for trunk roads that are considered to be non-core was first set out in the White Paper “A New Deal for Transport”, published in July 1998 (Cm 3950).

Following advice from the Highways Agency, informed by discussions with the relevant authorities, I have now decided that the following routes should be removed from the announced detrunking programme and remain part of the strategic road network, maintained and operated by the Highways Agency:

M32 (Bristol to M4 Junction 19);

A36/A46 (from M4 near Bristol to M27 near Southampton); and

M65 (Junctions 8 to 10).

I have written to the appropriate local highway authorities and relevant Members of Parliament, outlining the reasons for my decision. Copies of the letters to the Members of Parliament have been placed in the Libraries of both Houses.