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EU Council and North Africa

Volume 523: debated on Monday 7 February 2011

With permission, Mr Speaker, I should like to make a statement on last week’s European Council and comment on today’s review by the Cabinet Secretary of the papers relating to the release of Abdelbaset al-Megrahi, which were published at 1pm today.

The Council discussed three principal issues: first, the continuing efforts to tackle instability in the eurozone; secondly, the role of energy and innovation in delivering a comprehensive growth strategy for the EU; and, thirdly, the situation in Egypt. Let me take each in turn.

Eurozone members are quite rightly looking at ways to resolve some of the underlying problems of the euro crisis, including by strengthening economic co-ordination arrangements. My job is to protect and promote Britain’s interests. As I have said before, it is in our interests that the eurozone sorts out its problems. A strong and stable eurozone is in Britain’s interests, but in my view there are three absolute essentials for Britain.

First, we should retain our national currency and our ability to set our own monetary policy, in the UK and for the UK. Secondly, we should ensure that we are not dragged into a new mechanism for bailing out eurozone countries in future. As I described when reporting back from the last European Council, we have achieved that. Thirdly, and most complex, although we should not prevent eurozone countries from coming together to deal with the problems that they face, we must ensure that this does not compromise the single market, which is an important British success story in Europe and should remain one of our key interests. There is a danger that, in developing stronger co-ordination, eurozone countries start affecting things that are more properly part of the single market for all EU members. I made sure that this point was recognised at the Council, and I secured specific assurances to protect the single market. The statement by the eurozone countries, which will be available to Members and which we all debated, makes that clear.

Extending the single market to energy has been a long-held objective of recent Governments of all parties. Achieving that could add up to 0.8% of European GDP and mean another 5 million jobs across Europe by 2020. If we make a 20% improvement on energy efficiency by 2020, that could significantly reduce the pressure on household bills. A single market in energy is good for jobs, competition and energy security, so practical co-operation and competition with the rest of Europe on this is firmly in our national interest. The Council agreed that

“the EU needs a fully functioning, interconnected and integrated internal energy market,”

and that

“the internal market in energy should be completed by 2014”.

We also agreed that

“major efforts are needed to modernise and expand Europe’s energy infrastructure and to interconnect networks across borders.”

Britain should strongly support that, not least as we plan for the North sea offshore super-grid. The conclusions on innovation are also completely in line with what Britain supports and has been trying to achieve. Innovation and energy policy should be part of the growth strategy that we are arguing for in Europe. We will publish our own proposals before the next European Council in March, which will specifically be discussing that subject.

Next, let me turn to Egypt. I was determined that the Council would not produce one of its heavily “caveated” and sometimes rather unclear statements, and I think the declaration that we agreed is strong. First, we agreed that the Egyptian authorities should

“meet the aspirations of the Egyptian people with political reform not repression”.

Secondly, it is clear that a transition is needed to broad-based democratic government, and the declaration is emphatic that

“this transition should start now.”

The European Council was also clear that this should involve the building blocks of free and open societies and democratic institutions, such as freedom of assembly, the rule of law, freedom of speech and free and fair elections.

I believe that there is a strong case—the European statement reflects this—that the EU needs to look hard at its role in that region. We have spent billons of euros of taxpayers’ money in Egypt and neighbouring countries, with carefully crafted association agreements and action plans. We have offered funds, access to our markets and other assistance in exchange for progress on the rule of law, democracy and human rights. In Egypt, however, there has been little or no progress on torture, the judiciary, democracy or ending the state of emergency that has now lasted for 30 years. I believe that it is time for Europe to take a more hard-headed approach whereby the conditions on which we give money are real and insisted upon. I reaffirmed that message in a call at lunchtime today to Vice-President Suleiman, and urged him to take bold and credible steps to show that the transition that they are talking about in Egypt is irreversible, urgent and real.

Finally, let me say a word about the release of the Lockerbie bomber, Abdelbaset al-Megrahi, and the report that has been released today by the Cabinet Secretary. I have not altered my view, which I expressed at the time, that releasing Mr Megrahi was a very bad decision. He was convicted of the biggest mass murder in British history and, in my view, he should have died in jail. It was a bad decision, and the last Government should have condemned it rather than going along with it.

I commissioned this report during my visit to Washington last year. At the time, there was renewed controversy around the decision, a congressional inquiry into it, and calls for a bigger UK inquiry. Concerns were also being put forward, quite forcefully, in America and elsewhere that the whole release might have come about as a result of pressure by BP on the British Government to pressure the Scottish Government to make it happen. I do not believe that that is true, and this report shows that it is not true. It was a decision taken by the Scottish Government—the wrong decision, but their decision none the less. But in view of the continuing speculation in the UK and the US, I thought it right that all the British Government paperwork should be re-examined to assess whether more should be published, and I asked the Cabinet Secretary to do just that.

That is what Sir Gus O’Donnell has now done. In order to address the concerns that were being expressed, he was asked to look at three specific areas. First, whether there was any new evidence that the British Government directly or indirectly pressured or lobbied the Scottish Government for the release of Megrahi; secondly, whether there was pressure placed on the Scottish Government by BP for the release of Megrahi; and, thirdly, whether the Libyans were told that there were linkages between BP’s investment and the release of Megrahi, either under the prisoner transfer agreement or on compassionate grounds.

The report and all the paperwork, running to 140 pages, have been placed in the Library of the House. All decisions on the declassification and publication of papers belonging to the previous Administration were of course taken independently by the Cabinet Secretary. Under the convention covering papers of a previous Administration, he has consulted the appropriate former Ministers and the former Prime Minister. Sir Gus was assisted by the former Information Commissioner, Richard Thomas, to provide an independent validation. He saw all the paperwork, redacted and un-redacted, and his job was to advise the Cabinet Secretary on whether his report and the documents now being published were consistent with the materials that were reviewed. He was also tasked with determining whether this was a fair and accurate account of events. He is content on both counts.

The Cabinet Secretary concludes that the former Government were clear that any decision on Mr Megrahi’s release or transfer under the prisoner transfer agreement was one for the Scottish Government alone to take. He finds that none of the material he reviewed contradicts anything contained within the former Foreign Secretary’s statement to the House in October 2009. He makes the same finding with respect to the current Foreign Secretary’s letter to Senator Kerry in July last year and with respect to statements made by the former Prime Minister on this matter. He notes that it is evident that the Libyans made explicit links between progress on UK commercial interests in Libya and the removal of any clause on the prisoner transfer agreement whose effect would be to exclude Megrahi from it. He notes that after Megrahi had been diagnosed with terminal cancer in September 2008, the then Government’s policy was based on an assessment that UK interests would be damaged if Megrahi were to die in a UK jail.

The Cabinet Secretary finds—and this is a key point:

“Policy was therefore developed that HMG should do all it could, whilst respecting devolved competences, to facilitate an appeal by the Libyans to the Scottish Government for Mr Megrahi’s transfer under the PTA or release on compassionate grounds. . . as the best outcome for managing the risks faced by the UK”.

One of the Foreign Office papers released today makes it plain that

“Facilitating direct contact between the Libyans and the Scottish Executive is a key part of our game plan on Megrahi”.

Another Foreign Office paper from January 2009 states:

“We now need to go further and work actively, but discreetly, to ensure that Megrahi is transferred back to Libya under the PTA or failing that released on compassionate grounds.”

Frankly, I believe this tells us something that was not made clear at the time. It goes further than the account that the former Prime Minister and the former Foreign Secretary gave, as we were not told about facilitating an appeal, facilitating contact or a game plan. Indeed, the Cabinet Secretary’s report says:

“Policy was therefore progressively developed that HMG should do all it could, whilst respecting devolved competences, to facilitate an appeal by the Libyans to the Scottish Government for Mr Megrahi’s transfer under the PTA or release on compassionate grounds. . . as the best outcome for managing the risks faced by the UK.”

Hon. Members will be able to study the paperwork and consider these issues for themselves. My view is clear: we have learned some new information, particularly about what we were told by Ministers, but I do not believe that these papers justify calls for a new inquiry. What they do provide is further evidence that this was, in my view, a flawed decision by the Scottish Executive, which we already knew; and I believe they point to some broader lessons from this affair.

It is clear from these papers that the last Government badly underestimated—in fact, failed seriously even to consider except as an issue to be managed—the reaction both in Britain and in the United States to the release of Mr Megrahi, above all among many of the families who lost loved ones. The key point that emerges to me from reading the paperwork is that insufficient consideration was given to the most basic question of all: was it really right for the British Government to “facilitate” an appeal by the Libyans to the Scottish Government in the case of an individual who was convicted of murdering 270 people, including 43 British citizens, 190 Americans and 19 other nationalities? That, for me, is the biggest lesson of this entire affair. For my part, I repeat: I believe it was profoundly wrong. The fact that, 18 months later, the Lockerbie bomber is living at liberty in Tripoli serves only to underline that. I commend this statement to the House.

I thank the Prime Minister for his statement. I want to start, because of their importance, with the European Council conclusions on Egypt. I believe that the Egyptian people are continuing to show enormous courage and consistency in their desire for fundamental and lasting change. As I said last week, we support the call for a clear, credible and transparent path towards transition as soon as possible.

May I join the Prime Minister and his fellow leaders of the European Union in condemning any attacks on peaceful demonstrators and urge the authorities to allow the people of Egypt to continue to exercise their right to free and peaceful protests? The Prime Minister spoke to Vice-President Suleiman today, so will he update the House on his view of the current talks between the Vice-President and the Opposition parties and tell us whether he thinks these might lay the ground for the transition? Will he also offer the latest thinking of the EU and allies on the difficult issue of the role of President Mubarak during the transition?

Does the Prime Minister agree that the transition must include not just the provision of free and fair elections but other democratic structures, from a free press and diverse political parties to an independent judiciary? Will he also take the opportunity to update us on the steps he has taken since last week to ensure the safety of British nationals in Egypt during the current turbulence?

Let me deal with the other matters discussed at last Friday’s European Council. On energy policy, we welcome the Council’s conclusions on the internal market in gas and electricity and on the North sea grid. We also welcome the Council’s plans for improvement of Europe’s energy infrastructure. Such action can make us more resilient in the face of potential supply disruptions, as we saw in 2008-09 during the dispute between Russia and Ukraine.

Let me ask the Prime Minister two questions about the way in which our policy at home relates to the discussions in Europe. First, we note the Council’s conclusions on the importance of renewable energy. May I ask the Prime Minister to update the House on the implementation of the renewable heat incentive, which is a crucial part of his renewable energy strategy? It was due to come into force in April this year, but has now been delayed. Can the Prime Minister tell us when it will be introduced?

Secondly, given that the financing of energy investment is a big issue across Europe, which the Council rightly flags up, may I ask the Prime Minister to update the House on progress in regard to the green investment bank? He has committed himself to building on our plans. Can he tell us whether he intends this to be a fully fledged bank, as many have argued that it should be?

I welcome the Council’s conclusions on the wider economy, including the eurozone. May I ask what discussions took place on the prospects for European growth next year? The summit has concluded that

“the overall economic outlook is improving”,

but I have to say that that is not how it will seem to many families in the United Kingdom. Did the Prime Minister share the recent experience of the United Kingdom with the Council, and did he warn his colleagues that cutting budget deficits too far and too fast could have damaging effects on growth and employment?

Let me now turn to the case of Mr Megrahi. The Lockerbie bombing was a terrible atrocity, destroying hundreds of lives and scarring the families left behind. The Cabinet Secretary, Sir Gus O’Donnell, has conducted a serious and thorough report on the papers relating to Mr Megrahi’s release, and we will study it in detail.

Sir Gus’s report makes three significant conclusions that pertain to Mr Megrahi’s eventual release. First, it concludes that the United Kingdom Government were worried about the impact on British interests of Mr Megrahi’s dying in jail. That is precisely what the former Foreign Secretary said in a statement to the House on 12 October 2009. Secondly, the report makes it clear that there is no evidence that

“UK interests played a part in Mr Megrahi’s release by the Scottish Government on compassionate grounds.”

Indeed, Sir Gus went on to conclude that

“the former Government took great effort not to communicate to the Scottish Government”

their view. Thirdly, he concluded:

“Mr Megrahi's release on compassionate grounds was a decision that Scottish Ministers alone could—and did—make.”

So the message of today’s report is that Mr Megrahi’s release was not influenced by the United Kingdom Government. Perhaps the Prime Minister will tell us whether he agrees with that.

Above all, what today’s report should remind us is that the bombing of Pan Am flight 103 must live in the memories of this country and the United States. We must take all possible steps to ensure that it never happens again.

I thank the right hon. Gentleman for his comments and questions. I think that he is right about the response of the United Kingdom, the European Union and the United States to events in Egypt. While, in my view, one can never be certain that every statement made by the European Union is being listened to that carefully, I believe that in regard to its statement that the Egyptian Government must choose reform and not repression, the recent behaviour of the army in Egypt has been encouraging.

The right hon. Gentleman asked whether the current talks would be good enough to lead to transition. That is an extremely difficult question to answer. The point that I made to Vice-President Suleiman was that the more that the Egyptian Government could do to demonstrate that, for instance, they were bringing some opposition leaders into a transitional Government, the more they would be able to convince people that they were trying to reform, change, and deal with the constitutional issues. We have advised them to try to get ahead of events rather than taking a series of incremental steps, which I do not think are doing enough to respond to the aspirations of the Egyptian people. As the right hon. Gentleman rightly said, the transition is not just about the date of an election; it is about those building blocks of democracy that I mentioned earlier.

All United Kingdom citizens who wanted to leave have been able to do so. We will continue to keep travel advice under review, including advice on travel to the Sinai peninsula.

The right hon. Gentleman asked two very good questions about the renewable heat incentive, which is an absolutely vital initiative that we are taking, and about the green investment bank. Both projects are moving ahead. The Government have published structural reform plans with dates for implementation, so one thing that others can do is hold us to account when things do not happen during the week in which they are meant to happen, and I am sure the right hon. Gentleman will do that.

On the economy, the right hon. Gentleman has mentioned sitting round the European Council table and talking about the impact of cutting budgets. My overwhelming impression was listening—we had to listen at some length—to reports from Greece, Portugal and Spain about their economies. Having seen what they have had to cut and the difficulties that they are in, the warning that I take from that is, “Do not go back into the danger zone, where those countries still are.”

On al-Megrahi, I set it out as best I could in my statement. It is clear to me that those who think that a conspiracy was cooked up between BP, the British Government and the Scots to release al-Megrahi are not right. It was a Scottish decision by the Scottish Government—in my view, it was mistaken. As I have said, we have learned something today about what we were told in this House by Ministers. When hon. Members look at what was said in this House and what we have seen in these papers, I think that they will agree with me—I am trying to be very reasonable about this—that we were not given a complete picture.

As the then Secretary of State for Scotland, I had to visit Lockerbie on the night of that disaster, when I saw the terrible consequences that flowed from it. I have always been appalled by the release of the convicted murderer. The Prime Minister has drawn attention to the Cabinet Secretary’s conclusion, in which the Cabinet Secretary states that the previous Government wished to do all within their power to facilitate the release of Mr Megrahi. Do not the documents released today show that, in pursuit of that objective, a Foreign Office Minister met his Libyan ministerial counterpart, offered to send details of how release on compassionate grounds might be obtained and wrote to his ministerial colleague on 18 October 2008? Does that not confirm that the previous Government were up to their neck in this shoddy business, that they were desperate to see the release of Mr Megrahi and that they must therefore share responsibility with the Scottish Government for one of the most foolish and shameful decisions of recent years?

As ever, my right hon. and learned Friend brings a mixture of experience and precision to this issue. We were told by the previous Government what they did not want, which was the death of al-Megrahi in a Scottish prison, but we were not told by the previous Government what they did want, which was the facilitation of his release. That comes over, time and again. The most powerful point that my right hon. and learned Friend makes is this: in the end, that man was convicted of the largest mass murder in British history, which should have been the thought coursing through ministerial veins and brains when Ministers wrote those memos and made those speeches.

I fully understand the Prime Minister’s concern and that of colleagues on both sides of the House about the timing and circumstances of the release of Mr Megrahi. However, having read the Cabinet Secretary’s report in full, which I have here, may I say that it was wrong of the Prime Minister to elide quotations from the Cabinet Secretary’s conclusions with his own gloss, implying that those were indeed the conclusions? As my right hon. Friend the Leader of the Opposition has spelt out, and contrary to the implication that the Prime Minister has given to the House, the Cabinet Secretary concluded that nothing in the material that he reviewed contradicts anything that my right hon. Friend the former Foreign Secretary told this House on 12 October in a detailed statement or anything that my right hon. Friend the former Prime Minister has said at any time on this issue. The conclusions back up the continued assertion made by the former Prime Minister, the former Foreign Secretary and me, as the Prime Minister has finally admitted through gritted teeth, that there was no pressure from BP on the Scottish Government, that we acted properly at all times and, moreover, that at no stage did we ever suggest to the Scottish Government what decision they should take.

On so-called facilitation, let me read to the House the very next sentence. It

“amounted to: proceeding with ratification of the PTA”,

which was in hand anyway,

“explaining to Libya in factual terms the process for application for transfer under a PTA…and informing the Scottish Government that there was no legal barrier to transfer under the PTA”.

That was all known before and does not contradict what my right hon. Friend the former Foreign Secretary said at the time.

Let me make two points gently to the right hon. Gentleman. First, although the Cabinet Secretary rightly, in my view, finds that nothing in this report contradicts what the then Foreign Secretary did say, my point is purely this: this is about what was not in that statement. That is because when we look at what is in the report, we find that it is very clear that there were all sorts of things—facilitations and game plans—that we were not made aware of.

I do not want, in any way, to misquote what Gus O’Donnell has done in a very good report. The conclusions in paragraph 34 state:

“Policy was therefore progressively developed that HMG should do all it could, whilst respecting devolved competences, to facilitate an appeal by the Libyans to the Scottish Government for Mr Megrahi’s transfer under the PTA or release on compassionate grounds… as the best outcome for managing the risks faced by the UK.”

All right hon. and hon. Members will be able to make up their mind whether what we were told by the previous Government was a full and complete picture. Everyone can make up their mind and I am pretty sure what a reasonable person will come to.

The emphasis in these matters has always been on Mr Megrahi’s condition, but, respectfully, it seems to me that other issues have to be taken into account as well. The first is the nature of the crime, the second is the consequences of the crime and the third is the sentence imposed by the court. Had the British Government at the time taken proper account of those factors, I doubt very much whether they would have reached the conclusion that they did and sought to “assist”, to put it neutrally, the Libyan Government. But, equally, if Mr MacAskill had taken proper account of the nature of the crime, the consequences of the crime and the sentence imposed, he would surely have found that those factors far outweighed any question of compassion.

The right hon. and learned Gentleman puts it extremely clearly. The fact is that al-Megrahi was allowed to go home and die with his relatives, but that is not a luxury he afforded to anyone who was on that jet, and you have to take into account the nature and the consequences of a crime when you think about your actions. As I say, when we get away from all the detail of the report and just stand back and think about the big picture—as I say, the lesson to be drawn is that we have to keep focusing on the big picture—which is the heinous crime that was committed, the lives that were taken and the families that were wrecked, we have to think that someone has to suffer the consequences of that.

Order. Just because three of the most glittering stars in the parliamentary sky have asked very full questions, that does not, in any way, oblige right hon. and hon. Members to follow suit. On the whole, I would rather that they did not.

What discussions took place at the EU Council about events in Egypt lending added urgency to breaking the impasse in the middle east peace process? What is the Prime Minister personally doing to break that impasse?

I did have discussions with Baroness Ashton about this, it was also discussed around the table and I had a very good meeting with Hillary Clinton in Munich. Obviously, there are concerns that instability in Egypt will make progress on the middle east peace process more difficult, but I strongly believe that we should not take our eye off the ball and that we should keep the pressure up—that means pressure on both sides. It means pressure on Israel to make progress on issues such as settlements and pressure on the Palestinians to return to meaningful talks. Britain will play a very key role in this, and I commend Baroness Ashton for her work.

Trade between the United Kingdom and north African countries has historically been lamentable; we are way down the list on bilateral trade compared with our European partners. Will the Prime Minister do more to make sure that UK Trade & Investment plays a leading role in helping British companies to increase trade with countries such as Tunisia and Egypt to support democracy there?

My hon. Friend makes a good point and the Foreign Secretary will be going to Tunisia later today. We want to have good trading relationships with those countries, but that should never be bought at the price of trading off our values. We should have had a clearer red line about what was and was not appropriate, but Britain has to trade itself out of recession and links with fast-growing countries all over the world are absolutely what we are trying to put together.

Fine words have been said by the Prime Minister, the President of the United States and other western leaders about the very brave demonstrators in Egypt. Is it not possible that those demonstrators are asking—this is an interesting question—why the western powers have been so silent over the past 25 or 30 years about what has been happening in their country, including the authoritarian rule, the denial of liberty and the sadistic tortures that have been taking place in prisons? Those sorts of questions should be asked not only in Egypt but elsewhere.

The hon. Gentleman makes a good point. As I said in my statement, the EU has leverage over those countries in terms of the aid it gives and it should be tougher in asking for conditions in return for that aid. In terms of the situation we face today, I just do not accept that there is only, on the one hand, an Islamist regime or, on the other, standing up for the tough man—the dictator. We must encourage those countries not necessarily to have free elections just like that, at the flick of a switch, but to put in place the building blocks of genuinely free countries and open societies that will make sure that they have lasting democracies when they reach that goal.

The conclusion by Sir Gus O’Donnell that the previous Government did “all it could” to facilitate the release of Mr Megrahi is bad enough, but it is also inconsistent with the impression created by the previous Government. Has the Prime Minister made any assessment of the motive for such behaviour?

It is for Ministers to explain what they said and what they did not say. Clearly, they can rely on what is in the report about not being contradicted, but I think they have to look—and I hope they will do it fairly—and ask themselves, “Given that I was receiving memos about a game plan of facilitating contact and given that I was signing off those memos, shouldn’t I have really said to the House of Commons and elsewhere that it was not just that we didn’t want this man to die in a Scottish jail but that we were working actively with the Libyans to try to secure his release?” I think they should have said something more along those lines. I have genuinely tried to approach this by asking what is fair in terms of what we should have been told when those questions were asked.

I do not think that trade should ever be the sole determinant when it comes to our foreign policy, which is why I hope to persuade the Prime Minister to adopt more of his muscular liberalism, to coin a phrase, in relation to the Russian Federation. Sergei Magnitsky was tortured and murdered in a Russian jail when he was working for a British company in Russia. The United States Congress is now considering banning from the USA anyone who was involved either in the corruption he uncovered or in his torture and murder. Will the Prime Minister consider doing the same here and will he make sure that those views are expressed to Foreign Minister Lavrov when he visits next week?

The hon. Gentleman makes a good point and I am glad that the phrase “muscular liberalism” is catching on. That is exactly the approach we have taken with Russia and we do raise questions such as those that the hon. Gentleman asked when we hold meetings with President Medvedev, as I have done, or with Foreign Minister Lavrov, as my right hon. Friend the Foreign Secretary has done, and we will go on raising those issues. Some countries have not taken that approach, but we think it is the right approach.

Bearing in mind that several of the key moderate figures in Egypt have made pledges to have a referendum on the long-standing peace treaty with Israel, does my right hon. Friend, in pursuit of the excellent answer he gave to the right hon. Member for Exeter (Mr Bradshaw) earlier, agree that a key factor in determining whether we get a good outcome in Egypt will be whether the current Israeli Government are willing to stop building more settlements and be serious about coming to the peace table?

My hon. Friend makes a good point, but we should also be clear with reformers and opposition figures in Egypt that we see progress on the peace process as absolutely vital for the stability and prosperity of that region. This is where the European Union has some leverage because in those association agreements we should be making sure that just as there is money in return for progress on things we care about internally, they should also be about standing by agreements that have been entered into, including in the peace process.

I am grateful for an advance copy of the statement. The Prime Minister has long taken a different view from the Scottish Government or international observers such as Nelson Mandela on compassionate release. What is new, however, is that these official UK documents prove that as of autumn 2008, UK Labour Ministers supported Mr Megrahi being released to Libya, so they were saying one thing in public and the opposite in private. Is that not rank hypocrisy?

I have made my view clear and I tried to state it in a calm and reasonable way, because I do not believe that there was some conspiracy cooked up between a Scottish National party Government and a Labour Government. They find it hard enough to communicate with each other at the best of times. I see a few prominent Scottish MPs nodding. I think Ministers will want to look back at what they said and ask, “Could I have said more to give a complete picture?”

I welcome the European Council’s strong position of support for the Egyptian people, particularly with regard to assistance with the transition to democracy. However, building new Government structures is not straightforward and should not be rushed, and that is why it needs to start now. Will the Prime Minister ensure that in providing assistance, the EU draws on the expertise of organisations such as the Westminster Foundation for Democracy and the Friedrich Naumann Foundation, both of which have a wealth of expertise in supporting fledgling democracies and working in Egypt?

The hon. Lady makes a good point about civil society organisations here that can work with civil society organisations in Egypt. The point that I would make about transition starting now is that precisely because the Egyptians say that there are all sorts of problems with amending their constitution and doing it quickly, they should be examining what they can do to build confidence among people on the streets of Cairo that they are genuinely changing. That is where I think considering including Opposition members in a transitional Government and giving some visible, clear and irreversible signs of what their intentions are would make a big difference.

I think we heard two statements today, and they should have been separated. On al-Megrahi, does the Prime Minister recall that many of us had to hold our nose as IRA killers and terrorists were let out for the greater good of peace and stability? On his statement, can he say something about Tunisia? That is a small country, with only 10 million people, secular, highly educated, looking to Europe for help. May I ask him to ask the Foreign Office—he will probably be knocking at an open door—to see what we can do with economic and political investment in Tunisia to bring it, particularly as it is much smaller and more manageable than Egypt, closer to Europe?

The right hon. Gentleman makes a good point. That is one of the reasons why the Foreign Secretary is getting on an aeroplane this afternoon, going to Tunisia and talking to the Tunisians about helping to put in place the building blocks of a free and open society. One of the problems in these countries is the massive level of corruption. It was that which angered their populations so much, and we need to work with them. Going back to the issue of Libya and Northern Ireland, of course everyone had to hold their nose and talk to people we did not want to talk to and deal with people we did not want to deal with, but Governments were pretty frank about what we were doing and why we were doing it. That is my point.

It is important that we do nothing to talk up the prospect of wider instability in north Africa and the Maghreb. Does my right hon. Friend share my dismay at less than forensic reports in the western press that seek to conflate inherently unstable countries such as Egypt and Tunisia with countries such as Morocco, which have a far more enlightened order economically, socially and politically?

My hon. Friend makes an important point. We should not assume that those countries are all the same. Genuine stability should be based on the progressive realisation of the goal of a more open society and the building blocks of the sort of civil society that we recognise. We cannot pretend, as neo-conservatives did, that we solve the problems in one go simply by holding an election. We should be clear, as people who believe in those rights at home, that we should be trying to achieve them progressively elsewhere.

The Prime Minister referred, rightly, to the efforts and the work of Baroness Ashton. He also said that he had had discussions with Hillary Clinton. In that context, what is his understanding of the United States’ attitude to the changes going on in Egypt? Is it US policy to support Mr Wisner’s view that President Mubarak should stay, or to support the EU view that there should be an early transition?

That was a well-put question, which I will try not to glide around too diplomatically. The US and the UK are absolutely aligned on this; I spoke to President Obama over the weekend, and we are pushing for the same things. We want transition, we want it to be real and we want it to start now. We believe that it should include some of the things we have been discussing today, like bringing opposition figures into the Government, having dates for a road map for elections and making sure that they deal with some of the abuses of the past. In terms of what Mr Wisner said, I do not think that the way he put his words was a full reflection of the US Government’s view, as I think has been made clear.

Given my right hon. Friend’s important speech over the weekend, does he not agree that the previous Government’s facilitation of the release of al-Megrahi sent entirely the wrong signal to dictators, Islamists and terrorists right across the globe and represents a considerable setback to those who oppose such things? Will he take steps to ensure that as a United Kingdom we are never faced with such a situation again?

My hon. Friend makes a good point, which is that when this happened a very bad message was sent about what we stand for in the UK and our views in terms of the response to such a heinous crime. It is important to bear that in mind, and as I said in my statement, I do not think that enough thought was given to that, which in the end is the most precious of all judgments that Ministers should make.

As the Minister of State in the Scotland Office at the time, and as Mr Megrahi’s constituency MP, I strongly agree with the Prime Minister that Mr Megrahi should have spent the rest of his natural life in prison. Does he agree with me that however ill-considered and ill-judged phrases such as “our game plan on Megrahi” may be—had anyone approached me with such a game plan, I would have told them where they could put it—it must not obscure the central fact that it was a decision that was taken, and could only ever have been taken, by Scottish Government Ministers? There was no collusion, no cover-up and no conspiracy, just a bad decision by the SNP.

I go a long way with the hon. Gentleman, who I think made the right judgment about the release of Megrahi. The problem, and this comes out in the report, is that memos submitted to Ministers in the Foreign Office included things like,

“Facilitating direct contact between the Libyans and the Scottish Executive is a key part of our game plan on Megrahi”,

and that submission was subsequently agreed by the Minister. That is the point. The language about facilitating contacts that was put into memos was subsequently agreed by Ministers, including the former Foreign Secretary, and we were not told about that in the House of Commons. That is an issue that needs to be addressed.

One fifth—20%—of the Egyptian population are Christians, mostly Copts and some Catholics. Does my right hon. Friend agree that pluralism and human rights need to be at the centre of any dialogue on the future of Egypt and that the litmus test for whether Egypt is going forward into the 21st century or backwards will be the treatment of minorities, such as Christians, in the weeks and months ahead?

My hon. Friend makes an extremely good point. When you consider how much money the EU has put into a country such as Egypt—something like €500 million over the last three years—those are exactly the sorts of things that we should be insisting on, which I think are tests of a civilised society.

May I tell the Prime Minister that the 17 member states of the eurozone will be quite comfortable in dealing with safeguarding the euro into the future? He was right to refer to the single market in his speech in Davos last week, as 60% of our trade is with the European Union, but I urge him not to treat the EU as à la carte, only with trade; it must also cover the environment, immigration and energy security—that is to say, menu fixe.

I do not entirely agree with the hon. Gentleman: 50% of our trade is with the EU, and 44% with eurozone members. We want a healthy eurozone, but if a menu fixe means that we have to join everything, including the single currency, frankly, count me out.

Is it not terrific that we now have a Prime Minister who goes to Europe and puts Britain’s interests first? Would he clarify just one point? He said that we will not be dragged into a mechanism to bail out the eurozone countries, but that we could of course opt in to such a mechanism. Are we just ruling out a mechanism, or are we not going to join a mechanism that will help bail out the euro?

My hon. Friend asks a very good question that requires quite a complicated answer. Because of the previous Government’s decisions at the time of the general election, we are still at risk of the European financial mechanism, which was set up at that time and used in part to help Ireland, as it is decided by qualified majority voting. What we have achieved, in terms of the treaty change being proposed for the future, is to make sure that the UK cannot be pulled into a future mechanism for doing those things. That is the position we have managed to secure, and, as I say, in Europe once you have secured these things, you have to make sure that you damn well continue securing them for the future.

The Prime Minister said in his statement, “It is time for Europe to take a more hard-headed approach where the conditions on which we give money are real and insisted upon.” At the Security Conference in Munich, Baroness Ashton, when asked whether the European Union will continue to assist on conditionality for its aid, would not give a clear answer. Did the UK insist on that approach and Europe not agree, or did Baroness Ashton just fail to give us a precise answer?

What we discussed at the European Council was a specific declaration on Egypt, and I made sure that in that declaration there was some language about the association agreements that we entered into and making sure that they were real and tangible. I have the language in the folder before me; perhaps I can repeat it in a minute, because it does seem to me important. I am sure that Baroness Ashton, in looking at the conclusions that we reached, will recognise that we did all agree that that should be the case.

Could the Prime Minister tell us whether the EU Council took note that Morocco, which has embraced and is embracing a human rights and democracy agenda, has not suffered from outbreaks of civil unrest? Does he agree that we could do more to help that country and everyone in the region if we encouraged other nations in the area to take part in negotiations over a referendum on the future of Western Sahara?

My hon. Friend makes an extremely good point. In our relations with those countries, we want to look at all the things that will help to encourage stability, progress and peace rather than strife.

In terms of the association agreement with Egypt, the declaration on Egypt says very specifically that we agreed:

“The basis for the EU’s relationship with Egypt must be the principles set out in the Association Agreement and the commitments made.”

European leaders agreed that statement, and I think it is important for the future.

Were there any discussions at the European Council concerning Yemen? The Prime Minister will be aware of how important that country is in the fight against terrorism, and of the excellent talks between the Foreign Secretary and the Yemeni Foreign Secretary last week. Is the Prime Minister satisfied with the package of measures put forward by President Ali Abdullah Saleh? Is not the stability of Yemen absolutely vital in the area? If the Yemeni Government fall, al-Qaeda will be the winner.

The right hon. Gentleman makes an important point, which is that Yemen is vital to the security not just of that region, but frankly of our world, because there has been such a lot of al-Qaeda activity in that part of the Arabian peninsula. Yemen was mentioned at the European Council. In terms of the action that President Saleh has taken, clearly we want to see it in detail and see it put in place. There is something of wake-up call in Yemen because of the incredible stresses and problems that that country faces, and we need to work with it. I have met President Saleh and spoken to him on the telephone, and the Foreign Secretary has had meetings, as the right hon. Gentleman says. We need to help Yemen with its reform programme, not just so that it becomes more stable, but so that it is able to deal with the cancer of al-Qaeda which is in its own country.

Does my right hon. Friend the Prime Minister believe it to be a coincidence that, despite numerous assurances from the then Labour Government that Mr Ronnie Biggs would remain in prison until he died, the then Justice Secretary, the right hon. Member for Blackburn (Mr Straw), conducted a U-turn and released Mr Biggs on compassionate grounds—mysteriously just weeks before Mr Megrahi was released on the same grounds?

My hon. Friend is pulling me into territory where I should not go, but it does seem to be a pretty good medical record that people released from prison, normally on the brink of keeling over, then last for a very, very long time.

The Prime Minister mentioned that he wants to see a strong and secure eurozone. On a day when our papers are still full of stories about the predicament of British banks, which are vulnerable to loans that they made over recent years, and at the same time full of stories about bankers’ bonuses, can the Prime Minister tell us whether there was a discussion about the still perilous state of our banking system throughout Europe, and the fact that bankers’ bonuses are still paid out at such levels?

Of course we did discuss what lies at the heart of the eurozone crisis, part of which is about banks that were hopelessly over-leveraged, over-extended and all the rest of it. Here in the UK, we are having a serious conversation with the banks whereby we try to sort out what we want to see. I want to see them paying more tax, I want to see them doing more lending, particularly to small businesses, and I want to see a smaller bonus pool than last year. I am confident that we will be able to achieve those things in this country.

I know that the Prime Minister has to use diplomatic language, but we all know that the truth is that if al-Megrahi had come from a non-oil rich, non-strategic country, he would still be in prison. So imagine the pain today of the mothers and fathers, the sons and daughters, of those killed on that flight. Can the Prime Minister somehow, on behalf of the British people, say sorry, apologise and articulate the view that never again will we appease murderous dictators in the interests of realpolitik?

My hon. Friend puts the point very powerfully. I would say to all those who lost loved ones in that appalling terrorist act that we are profoundly sorry for their loss and for how they have suffered. When one of them said, “I’m not able to spend Christmas at home with my loved ones in the way that this man is”, I think they spoke for everybody. We have to understand that when a crime like that is committed, it is not some un-violent sense of retribution just to say that that person should not be released from prison. They have basically committed a life sentence on all those families who are never going to see their loved ones again. Not to understand that is to fail in the duty of a Minister.

This further step towards our long-held goal of a single market for energy should open doors for areas like mine to forge ahead with offshore wind. Will the Prime Minister recognise and address legitimate concerns over the weakness of his policies for growth so that jobs are created here in the UK and small businesses can properly apply for and get jobs in the supply chain?

I do not accept what the hon. Gentleman says. At a European level, this is going to be helpful for the onshore and offshore wind industry and other renewable industries in this country. Also, here in the UK we have provided specific grants to ports to update their infrastructure so that large manufacturers can come here and manufacture wind turbines and provide offshore wind. I have spoken personally to companies that are coming to do that in parts of the UK. We will go on supporting the growth of this very important renewables sector.

The Prime Minister has highlighted some significant inconsistencies between what the previous Administration stated publicly and what was released by Sir Gus O’Donnell earlier today. Obviously, the focus should be on the victims of this horrendous crime, but what assessment has the Prime Minister made of the effects on the relationship with some parts of the US Administration?

The relationship is extremely good, and I think it will go on being good. I discussed this issue with Hillary Clinton when we met at the weekend. I think that the Administration have been grateful for the very strong and clear view that the Government have taken about the events surrounding the release of al-Megrahi and the fact that it was wrong. This point also goes back to what was said earlier. Of course, we want to have good relations not just with America but with Libya and with other countries, but we have to have some pretty clear lines in our minds about what is going to be part of that relationship and what is not. Frankly, I think it is perfectly possible to have good relations if we are clear about those things.

I was fortunate enough to work briefly with one of the victims of the Lockerbie bombing who was so tragically taken from us in 1988. I am sure that the families of these victims will be very interested to read the report that was issued today. Is my right hon. Friend aware of whether any previous Ministers from the former Government are planning to meet the groups of families who represent these victims to explain the policy that has so obviously come to light today?

I know that a number of victims’ families will obviously be interested in the report, and some will be seeking meetings either with the Government or with others. To be frank with my hon. Friend, not all the victims’ families take the same view about al-Megrahi and what happened and whether he was responsible, and all the rest of it. We have to be clear that he was convicted after a properly constituted and thorough trial. He then had an appeal, which was quashed. On that basis, the decisions that were made were clearly wrong decisions.

In the Cabinet Secretary’s report, he notes that the former Justice Secretary, the right hon. Member for Blackburn (Mr Straw),

“contemplated the merits of offering the Scottish Government a letter in support of a Libyan request”

to release al-Megrahi. Does the Prime Minister agree that that was an odd thing to contemplate if it was clear that there was a Government policy not to put any pressure on the Scottish Executive?

To be fair to the right hon. Member for Blackburn (Mr Straw), who is not here—although it is not my job to defend him—the report states that he considered making contact with the Scottish Executive and then decided not to. That piece of evidence suggests that there was not the great conspiracy that some people felt there might have been, in particular the American Senators I met who represent victims’ families. It is easy to understand why they thought that might have happened. They were looking at a country overseas, and were hearing what BP was saying, what the Government were doing and what the Scottish Executive were doing. However, I do not think that that is how the evidence stacks up. There was no conspiracy—it was a Scottish decision. As I said, the report highlights some issues about what we were told and how we were told it.

Greece is responsible for an extremely leaky part of the EU’s external border. Its asylum system was recently condemned as unfit. The problem for the UK is that should economic migrants make their way into the EU to claim asylum and end up in Britain, we cannot send them back to Greece. Was that issue discussed at the Council? How can we get the Greeks to secure their part of the EU frontier?

We did not discuss the EU migration issue at this Council, but we discuss it often. Greece and Italy tend to be voluble about it because they are often the door through which so many migrants come. I will make two points. First, we need to ensure that we can return people. The arrangements between Britain and France are extremely good. Secondly, one reason why we should not have a common immigration policy is that I do not want our population to be dependent on decisions made at the border of other countries. That is why I think we should keep this as an area of national competence.