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European Council and Nuclear Security Summit

Volume 578: debated on Wednesday 26 March 2014

With permission, Mr Speaker, I should like to make a statement on last week’s European Council and this week’s summit in The Hague, which included the first meeting of G7 leaders—without Russia—in almost two decades.

Before I turn to the subject of Ukraine, let me briefly update the House on discussions on the economy, on energy and climate change, on the situation in Sri Lanka and on efforts to combat nuclear terrorism.

First, our long-term economic plan is supporting the growth of a new trend, reshoring, in which jobs are starting to come back to the UK. A recent report from EEF, the manufacturers’ organisation, found that one in six firms had brought all or part of their production to UK suppliers over the past three years. That reshoring of jobs is vital because it means that more of the benefits of globalisation can be felt by the British people, so, with the support of the CBI and Business Europe, I argued at the European Council that we should do more to develop reshoring in Britain and across Europe. The Council agreed to encourage that by doing more to cut red tape, attract investment, stimulate innovation and pioneer more work on reducing energy costs, including shale gas.

Secondly, businesses need affordable energy prices to keep pace with their competitors, so we agreed to accelerate efforts to complete the internal energy market and we agreed to improve the energy flow across the continent with more interconnections. On climate change, we want the EU to play a strong leadership role in efforts to secure a global climate deal next year in Paris. That means swift agreement on a target for reducing greenhouse gas emissions in the European Union, and I fully support the 40% target proposed. At the European Council meeting we did not reach full agreement in the EU and further attempts will be made on that later in the year.

Thirdly, on reconciliation in Sri Lanka, President Rajapaksa has failed to address the issue of the past properly, so in the coming hours the United Nations will vote on a UK-sponsored resolution for an international and independent investigation into alleged war crimes. At the Council, I secured the full backing of all EU member states for this approach and it is reflected in the conclusions of the Council. At The Hague I urged leaders from countries as diverse as South Korea, Kazakhstan, Gabon and Japan to support this crucial resolution.

On combating nuclear terrorism, which was the subject of the summit in The Hague, the meeting reaffirmed our determination to push through reforms of global security systems to ensure that vulnerable nuclear material does not fall into the wrong hands. This initiative, launched by President Obama back in 2010, has led to a remarkable amount of nuclear material being secured and reduced across the world, which should be commended.

On Russia’s actions in Ukraine, I had four clear objectives at these meetings: to secure an increase in the number of people subject to travel bans and asset freezes; to agree specific measures in response to what has happened in Crimea; to develop more clarity on what would happen if Russia were to take further steps to destabilise the situation in Ukraine; and to join efforts to build support for a democratic, successful and independent Ukraine. I want to say a word about each.

First, as I made clear in this House two weeks ago, if Russia did not engage in dialogue with the Ukrainian Government, or if those talks did not start producing results, there must be clear consequences. As a result, travel bans and asset freezes have been imposed, and last week the European Council agreed to extend these measures to another 12 individuals, bringing the total to 33—broadly the same number as has been imposed in the US. We have cancelled the EU-Russia summit, agreed not to hold bilateral summits, and decided to block Russian membership of the OECD and the International Energy Agency. In The Hague, G7 leaders agreed that there would be no G8 summit in Sochi and no further participation in any G8 activities until Russia changed course. We agreed there would instead be a G7 meeting in Brussels in place of the Sochi summit on the same day.

I also pushed hard on the need to reduce Europe’s dependency on energy from Russia. The G7 agreed that energy Ministers would meet ahead of the Brussels summit, and the European Council tasked the Commission to produce a comprehensive plan for reducing Europe’s dependency on Russia by June. This work is long term but vital. It requires new gas pipelines, new liquefied natural gas terminals, more shale gas, more sources from outside Russia and greater connectivity. Above all, it requires political will and I am determined that, although the UK has almost no reliance on Russian gas, we should play our part in this important work.

Secondly, it was important to take specific measures in response to what has happened in Crimea. This was a sham and illegal referendum conducted at the barrel of a Kalashnikov. Both the European Council and the G7 leaders made very strong statements condemning the illegal referendum and condemning Russia’s illegal attempt to annex Crimea in contravention of international law and specific international obligations. Both meetings were clear: the international community will not recognise either. The European Council also agreed to implement economic, trade and financial restrictions on occupied Crimea, accepting Crimean goods only if they came from Ukraine, not Russia.

Thirdly, both the G7 and the European Council sent a very clear message to President Putin that it would be totally unacceptable to go further into Ukraine. The international community remains ready to intensify sanctions if Russia continues to escalate this situation, and I pushed hard at both meetings to secure greater clarity on what this should mean. The G7 agreed that this could include co-ordinated sectoral sanctions that would have an increasingly significant impact on the Russian economy; and for the first time, the EU Council tasked the European Commission to prepare measures that would have far-reaching economic consequences. Russia has a clear choice to make. It does not have to continue on this path. Diplomatic avenues remain open—and we encourage the Russian Government to take them.

Finally, both meetings reaffirmed the strength and breadth of international support for the Ukrainian Government and their people. It is clear what needs to happen. We need a broad and generous International Monetary Fund package of financial assistance to help the Ukrainian Government stabilise and repair their economy. We need a Ukrainian Government who reach out to the regions and respect the rights of Russian-speaking minorities. We need an association agreement between the EU and Ukraine; that is now signed, but it needs to be backed by reduced tariffs on Ukrainian goods. We need international support for free elections, which should enable all Ukrainians to choose their leaders fairly. Britain will support all of these things.

Russia’s violation of international law is a challenge to the rule of law around the world, and should be a concern for all nations. We have to be clear how unacceptable it is, and to see through these economic sanctions and consequences. Otherwise, we will face similar situations in similar countries with a similar sort of unacceptable behaviour. Britain must continue to play its part in standing up to Russia’s actions—pressing for Russia to change course, and helping the Ukrainian people in their hour of need. I commend this statement to the House.

I start by welcoming the Prime Minister’s statement. I want to start where he did, on the formal substance of the EU summit and its conclusions.

We welcome the steps that were agreed in efforts to complete the internal energy market, to improve the energy flow across the continent, to strengthen EU tax rules on the exchange of information, and on nuclear proliferation. On climate change, I agree with the Prime Minister on the importance of the EU reaching agreement, if possible in advance of the UN climate leaders summit in September. The EU has shown leadership on this issue before. Some countries in the EU have doubts about the strength of the 40% target, but it is a target that we support and I know he supports, and he will have our support in pushing for maximum ambition on this issue.

On discussions regarding the vote at the UN Human Rights Council on Sri Lanka today, I am grateful to the Prime Minister for setting out the actions that have been taken. In the event of the UN resolution being passed, which is what we all hope for, will he say what he sees as the next steps to ensure that the inquiry we all want to see actually happens?

Let me turn to the main substance of the summit—Ukraine. The House is united in outrage at Russia’s annexation of Crimea. It is an action in direct violation of Ukraine’s territorial integrity and it is a clear breach of international law. Russia’s actions have created the most significant security threat on the European continent in decades. I believe that Members across the House will want to praise the measured response shown so far by the Ukrainian authorities in response to this terrible act of aggression. I also want to express support for the shared goals set out at last week’s EU Council meeting—of both isolating Russia for its actions and reassuring our allies and partners in the region.

I will take the specific outcomes of the summit in turn. First, I welcome the signing of the political chapters of the association agreement between the EU and the Ukrainian Government. It was that strengthening of co-operation with the EU, spurned by the former President, that partly sparked the current crisis. It is right that the EU should continue to make it clear that these agreements are not a zero-sum game between the EU and Russia—but it is also right that the EU now pushes ahead with similar pacts for Moldova and Georgia.

Secondly, it is vital, as the Prime Minister acknowledged, that the international community imposes real costs on President Putin and his key supporters. For that reason, we welcome the agreement at the EU summit on extending the list of individuals targeted by visa bans and asset freezes. But unlike the Washington list, the EU list avoided placing sanctions on certain senior Kremlin figures. Will the Prime Minister explain the reasons behind that, and say whether any specific proposals were put forward for consideration before the final agreement on the publication of the EU list?

Thirdly, given that the US has added sanctions on the Bank Rossiya and indicated that the economic sectors may be targeted as part of its approach, the Prime Minister said we would have a sectoral approach on these matters. Will he say what sectors are being looked at as part of the EU discussions?

Turning to the meeting of the G7 and the EU, we welcome the decision taken by members of the G7 to suspend the 16-year collaboration with Russia. It is absolutely right, not only that the Sochi summit does not go ahead, but that no future summits can be envisaged while the Russian action is outstanding. I note also, though, that this week the Russian Foreign Minister held talks with his Ukrainian counterpart for the first time since Russia’s move into Crimea. May I ask the Prime Minister what steps are being taken to ensure that such dialogue continues between Ukraine and Russia in the weeks ahead?

Finally, given that the Prime Minister said this week that Britain and its NATO allies would help to bolster the defences of the alliance’s Baltic members, which have Russian minorities and will be feeling particularly vulnerable at this time, will he tell the House what the nature of any such UK contribution would be?

The actions of the whole international community should be designed to strengthen Ukraine’s sovereignty and democratic transition, to impose real costs on the Government of President Putin, and to bring all sides together in a meaningful dialogue to de-escalate the situation and find a political solution. As we have said throughout this crisis, in taking this action, the Prime Minister will have our full support.

I thank the Leader of the Opposition for his response and for the points that he made in support of the approach that we are taking. Let me try to answer every point in turn.

On the Council communiqué, the right hon. Gentleman is right to mention the advances on tax transparency. This has been hard going, but there was a real breakthrough with Luxembourg and Austria now signing up to the approach. It means we have to put pressure on Switzerland to make sure it does that too, but we have made real breakthroughs in realising proper exchange of tax information, and I want to thank Austrian and Luxembourg colleagues for doing that.

On climate change, we agree that we need an agreement for the 40% reduction in carbon emissions. I think it will be achieved later in the year. We have to engage with the Polish Government and others. They do have an understandable concern, which is that if we are trying to control carbon and restrict supplies of Russian gas, that could lead to some countries burning coal. That does not help on the climate change front, and we need to work with them to find a solution.

On Sri Lanka, I am very grateful for the support we have for this co-sponsored UK motion. We hope it will be carried. If it is, then it is mandated that the review has properly to go ahead.

On Ukraine, the right hon. Gentleman is completely right that we should not see this as a zero-sum game—either a Ukraine that leans to Russia, or a Ukraine that leans to Europe. We want Ukraine to be a bridge between the two. It should have a proper relationship with Russia, but also a growing relationship with Europe—if that is what its people want. He is right to say that we should push ahead with these agreements, not only with Ukraine, but with Moldova and Georgia. It would send a terrible message if, because of what Russia has done, we were to pull back from these agreements that we would otherwise be signing.

On the question about why the US is taking a slightly different approach to the EU in terms of the specific individuals targeted for asset freezes and travel bans, the approach we take in the EU is that the individual concerned should have a proper link with the action taken in Crimea. [Interruption.] The right hon. Gentleman asks why. I think it is because of the legal processes under which the EU has to act. There is a logic in saying that it is right to target those—including Russian MPs—who have played a role in this illegal act.

In terms of economic sectors and future sanctions were Putin to go further in Ukraine, because the EU talks about wide-ranging economic sectors, that would have to include areas such as energy, financial services, trade and arms. The breakthrough here was to get the Commission to start the work, because it is no good warning about economic sanctions if work is not under way to deliver what they should be. That was a real breakthrough at the meeting which Britain strongly supported.

The Russian Foreign Minister’s talks with the Ukrainian Foreign Minister are hugely welcome. I met Ban Ki-moon yesterday to encourage further such contacts and for the UN to do everything it can to bring together Ukrainian and Russian Ministers.

Finally, the right hon. Gentleman asked about NATO and what we were doing to help to provide certainty and security particularly to Baltic countries. We are increasing our help with their air policing and are making four aircraft available. We should do everything we can to reassure our friends and colleagues in Latvia, Lithuania and Estonia and in Poland that we really believe in their NATO membership and the guarantees that we have given to them, and that we will work together to secure the future of Europe, as we have in the past.

Does the Prime Minister agree that when the history of the Crimea crisis comes to be written, it will be found that there were no winners? President Putin has, of course, control of Crimea, but he has lost Ukraine and done much to unite the Ukrainian people. Will my right hon. Friend also accept that the international community—the United States and European countries—will not fare well in the judgment of history either? The response that we have made to the invasion of a European country by its neighbour and to the annexation of its territory in contrast to all its neighbour’s international legal obligations has resulted in a very timid and hesitant response, with no financial sanctions or sanctions that might influence future Russian behaviour. That surely is not the best way to deter future aggression.

My right hon. and learned Friend speaks with great force and a huge amount of wisdom on this issue, but I think it is too early for the history books to be written. What really matters is that the countries of the European Union, the United States and the international organisations, such as the UN, recognise that we need a long-term approach. When the history books are written, I hope they will show that Europe decided to become more energy independent, that the UN stood up for the importance of its charter and that Britain, America and our allies took a series of predictable and consistent steps to demonstrate to Russia that what she was doing was wrong. If we take a long-term approach, I think we will achieve an outcome that the history books might be kinder about.

I commend the Prime Minister and Foreign Secretary’s strategy. In the absence of sending gunboats, which I think few of us would recommend, a step-by-step, long-term approach is sensible. Ukraine is one of the very few countries in the world that voluntarily gave up nuclear weapons on its soil, and it did so in return for clear guarantees of its territorial integrity, including from Russia. Given the talks on nuclear security that he has been involved in, can he say what further steps need to be taken to ensure that Russia’s invasion of Crimea does not undermine the international strategy to reduce nuclear proliferation?

The right hon. Gentleman, who served as Foreign Secretary, makes a very good point. There was never an option of sending gunboats. There is not some military answer to this. The only approach is a considered, long-term, tough and predictable one so that Russia knows that if it goes further into eastern Ukraine there will be very significant economic consequences. He makes an important point about countries that have given up their nuclear weapons not fearing that they have made the wrong decision, because there were countries, such as Kazakhstan, represented at the conference in The Hague which made the point that they had taken those steps too. That only serves to underline the importance of taking a long-term and tough approach to Russia on this.

Does my right hon. Friend agree that an unresolved question is whether the annexation of Crimea was opportunistic or part of a wider strategy? Against the possibility of the latter, is it not now time to reaffirm the transatlantic alliance, enhance defence and political co-operation in Europe and strengthen the capabilities of NATO?

My right hon. and learned Friend asks a very good question: whether it was opportunistic or part of a strategy. I think that one can argue that it is part of a pattern. If we look at Abkhazia, South Ossetia, Transnistria and other frozen conflicts, we see a pattern emerging. That reinforces the importance of not just the west—NATO, the EU and the US—but the UN and other countries recognising that if we reward that sort of aggression in this part of Europe, others in other parts of the world will draw lessons from that. With regard to strengthening NATO, we have the opportunity of the NATO conference in Wales this year to reaffirm and refresh NATO’s vows, and I expect there to be a good and strong conversation about how to ensure that it maintains its relevance in the modern age.

Does not the annexation of Crimea demonstrate the weakness of our strategic approach to the Putin regime over many years? I understand the need for short-term reactions and rhetoric, but surely the emphasis must now be on long-term measures, because the nature of the regime has been apparent for many years. Energy dependency, economic dependency and defence capability through NATO are where our emphasis needs to be with regard to this crisis.

The right hon. Gentleman makes some very good points. The UK is not reliant on Russia for energy; we use a very small supply of gas that comes from Russia. That contrasts hugely with some other European countries, many of which rely on Russia for 80% or more of their gas. I agree that we need a long-term approach, as I said in my statement and in answers to questions, but I take issue slightly with what he said, because I think that this Government, and indeed the previous Government, have tried to engage with Russia not on the basis of softening the real concerns we have—we did not water down the Litvinenko measures, for example—but by arguing very strongly about the importance of human rights, civil rights and democracy, and in meetings with President Putin I have raised things such as the importance of gay equality. So we engage, but in a hard-headed way. I do not think that that engagement was wrong, but clearly if Russia chooses to go down this path there will be big consequences for the way that relationship works in future.

Will my right hon. Friend immediately ensure—this has not happened so far, either in this statement or in those made by the Foreign Secretary over the past few weeks—that the House, and indeed the European Scrutiny Committee, is given a full and formal report explaining the foreign security and defence implications for the United Kingdom of the whole of the association agreement between the EU and Ukraine, including the political chapters, and the implications of the Final Act endorsed by the presidency conclusions over the weekend, particularly given the crisis with Russia and the EU’s assertion that Ukraine still includes Crimea? What will the timetable and procedure be for parliamentary ratification of both, because it is understood that the political parts of the association agreement will take effect before parliamentary ratification?

The assurance I can give my hon. Friend is that the association agreement between the EU and Ukraine is a document that will be in the House of Commons Library, if it is not there already, and people can study it. It is important that we sign the agreement. Imagine if we got ourselves into a position in which we were prepared to sign it when Yanukovych was running Ukraine but, because of what has happened, decided as a country and as a European Union to walk away from it. That would have been an extraordinary decision, so I think it is right to sign the political chapter and then try to open Europe’s markets to help the people of Ukraine.

I agree with much of what the Prime Minister has said, but does he not agree that bluster and bombast by diplomats and military leaders is unlikely to resolve the problem? Instead, we need a negotiated solution in which Ukraine’s military neutrality is guaranteed by both Moscow and Washington and in which NATO does not engage in any further enlargement or encirclement of Russia’s border, in return for a clear guarantee that Russia will not conduct any more aggressive moves in Ukraine, Moldova or any of its other neighbours. It seems to me that unless we get a deal like that, we will not make much progress.

I certainly agree that we do not want bluster and bombast; we want a talked process. But we have to be clear that a really good offer of a talked process and a contact group was on the table and the Russians refused to engage with it. That is why I think that the action taken—limited to start with, but growing—is necessary to demonstrate that there are two paths Russia can take: one of increased international isolation, and one of talks. As for the extension of NATO, I hear what the right hon. Gentleman says, but there must be many people in Lithuania, Latvia and Estonia who, looking at their own country and the future they want, and because they have Russian minorities there, must feel glad that they have the protective cloak of NATO.

By annexing Crimea, Russia stands in flagrant breach of its commitments under the Budapest agreement of 1994, to which the United Kingdom and the United States are signatories. I say to my right hon. Friend, whose leadership on this I salute—it is a shame that some other European countries have not been so resolute—that if we are to deter Russia from further breaches of that agreement, we need to do more than issue hollow threats of further measures that are as yet unspecified. At the risk of being accused of being slightly militaristic about this, I will add that this is what NATO is for. I suggest that we need to consider a NATO maritime force to deter Russia from going further and annexing eastern Ukraine, which would give it a land corridor to Crimea, and indeed to Odessa.

I thank my hon. Friend for what he says. There are two things we need to stress here. One is that NATO is a defensive alliance and we should now be working hard to reassure NATO members about our commitment to their collective security and all the things that means. That is very important, and President Obama was very clear about it at the G7 meeting. The second thing we need to do—here I part company a little bit with my hon. Friend—is to make clear what steps we would take if Russia were to go further in eastern Ukraine. Those would be economic steps, but do not let us doubt how strong and powerful they could be. My argument in the European Council has been, given we know that if Russia were to go into eastern Ukraine we would have to put in place pretty robust sanctions, that it is worth trying to set out some of the arguments in advance so that Russia can see the very serious consequence of these actions.

Alexander Litvinenko died in University College hospital having been murdered by the agencies of the Russian Government. The British Government’s response to that so far has been to prevent the establishment of a proper inquest. Will the Prime Minister now demonstrate that he believes in the rule of law here and that that inquest should be started, and carried out thoroughly and completely?

The murder of Alexander Litvinenko was a dreadful act, it took place on British soil, and we should take the strongest possible exception to that. That is why the Litvinenko measures were put in place and remain in place. Yes, of course there needs to be a proper process of finding out what happened. My view has been that an inquest, properly constituted, should be able to deal with these issues, including dealing with sensitive information that will need to be taken into account, but I have always made it clear that if that is not possible and we need a different form of inquiry, that will have to take place instead.

May I thank the Prime Minister and the Foreign Secretary for the role they have played in getting a united, strong response to Russia’s actions? Does he agree that it is vital that the situation on the ground in Crimea is properly monitored, and can he provide this House with reassurances that that can and will be done?

First of all, I thank my hon. Friend for what she says. It is sometimes difficult getting 28 countries to agree to the steps that are being taken, but that is what we have achieved at two European Council meetings so far, and these sets of measures have greater strength having all 28 countries behind them. Monitoring will be difficult in Crimea, specifically, because of what is happening right now. But what is even more important is to get the OSCE monitors into Ukraine, and we said very clearly at the European Council that if that is not possible, an EU monitoring mission should be sent instead. The importance of this cannot be overstated. It is very important that we reveal to the world what is actually happening in eastern Ukraine rather than simply believing the propaganda that the Russians are pumping out.

Some time ago, it might have seemed a remote possibility that article 5 obligations would be triggered, but given the events in Russia and Ukraine, it is now more likely than it has been for a very long time. Has the Prime Minister talked to other NATO members about a capacity review so that we can not only be sure of the political will to respond, should the need arise, but actually have the military capacity on the ground?

The hon. Lady makes an important point. Building the capabilities of NATO is going to be an important theme of the summit, but NATO is holding its normal regular meetings to discuss how to respond properly to what is happening, and we have added to that by the offer that we have made to the Baltic states.

The Prime Minister has made it quite clear that he considers that Russia’s behaviour and breaches of international law are a wake-up call to the west, but is it not time to reassess whether our capacity matches our aims and objectives? For example, with difficult situations in Iran, Syria, north Africa and now Ukraine, does he think it right that the Foreign Office budget is less than we spend on the winter fuel allowance?

I think we do a huge amount with the Foreign Office budget, if you look at what my right hon. Friend the Secretary of State has been able to squeeze out of the Treasury. He is opening embassies across south-east Asia and parts of Africa. He has reopened the foreign language school of the Foreign Office, and that is making a real difference. It is the capacity of what we are able to do that matters most of all. In terms of the defence reviews and strategic reviews we have carried out, I repeat what I said at Prime Minister’s questions, which is that if we make difficult decisions—for instance, about the number of battle tanks in Europe and the moving of forces back from Germany to Britain—and we make some long-term savings, we can then invest in the sorts of capabilities that we will need. Of course, those capabilities, as my right hon. Friend the Minister for the Armed Forces reminds me, include a brand-new aircraft carrier coming very soon.

President Obama’s sanctions are so much stronger, and they target directly members of Putin’s corrupt inner circle who have dirty assets in London. Why is the Prime Minister so reluctant to do the same?

I am not reluctant to do the same at all. As I said, the EU process is about finding people who have a connection with the decision in Crimea and making sure they are properly targeted. I do not think it is fair to say that the Americans have taken tough actions and the Europeans have been slow to follow. One of the things we agreed at the European Council was specifically to target goods and services from occupied Crimea that cannot now be sold in Europe unless they go through Ukraine. That is a step that the Americans have not yet taken and a point I made at the G7.

Contrary to what some have said, particularly my right hon. and learned Friend the Member for Kensington (Sir Malcolm Rifkind), is the Prime Minister aware that many of us support his careful and proportionate response, and we think that he might be an arbiter, because there is no history between us and Russia in these matters? Is he aware that many of us welcome his remark today that Ukraine—Ukrayina, which means “borderland” in Russian—might become a bridge to peace, not a path to war, if we promote free trade for Ukraine both with the EU and with Russia?

I want us to promote free trade with Ukraine. That is why the association agreement—the political part of it that is signed—now needs to be accompanied by the European Parliament lifting tariffs so that we can see Ukrainian goods come into the EU. I repeat what I said: we would like Ukraine to be a bridge between the EU and Russia. We are not asking it to take sides—to choose one path or another path; it is the Ukrainian people who should determine the path that that country takes. It is obvious from the history, geography, economy and everything else that it needs to have a very strong relationship with Russia as well as with the European Union.

May I welcome the Prime Minister’s statement? These developments in Ukraine and Crimea certainly underline and emphasise the relevance of NATO in the modern era. I support what has been said about defence capacity. Will he undertake at the NATO summit later this year to raise with our NATO partners and Governments the need for everyone to step up to the plate in terms of their contributions towards defence capacity so that we can ensure that a proper and measured response is available if needed?

I agree with the right hon. Gentleman. This is always a difficult subject in NATO because people do not want to give up national capabilities and invest in capabilities that enhance NATO as a whole. There are some steps we need to take. We should continue to oppose the establishment of EU headquarters as unnecessary duplication. We should be working very closely with major allies that have similar capabilities, like the French, which is what the Lancaster House agreement is all about. We should encourage other countries to do what Britain is doing in matching our contribution of at least 2% of GDP and defence spending. If we did all those things, plus some more creative working together, we could enhance our capacities.

May I take it from what the Prime Minister has just said that there is then no question of the British defence budget dropping below 2% of GDP?

We currently meet the 2% threshold. These things are calculated by different countries in different ways, but I am confident that we will go on meeting our obligations to NATO.

Will the Prime Minister confirm that all the important security issues being discussed at the G7 and in the European Union are also being discussed within the context of NATO—an organisation currently going through a change in its general secretary? Will he confirm that he is supporting the candidacy of the excellent former Norwegian Prime Minister, Jens Stoltenberg?

I think Jens Stoltenberg would be an excellent candidate. I have worked very closely with him, and it is very good to have such a candidate who has filled such a high office in his own country. Obviously, if we want to be part of NATO, we have to remain part of the United Kingdom.

The lesson of Ukraine seems to be not just a wake-up call, but one in humility and a reminder of how unbelievably difficult it is to understand, predict or control events in places such as Ukraine, Syria, Libya, Afghanistan and Sahel simultaneously. The only solution has to be better deep country knowledge. Does the Prime Minister agree that we need to invest far more in the policy and linguistic capacity of the Foreign Office if we are to deal with this range of threats in the future?

My hon. Friend is completely right. The deep country knowledge that resides in our Foreign Office and diplomatic service is an immense asset for the Untied Kingdom. As Prime Minister, I see that all the time, particularly when dealing with some of the countries mentioned by hon. Friend that suddenly have a significance far beyond what they previously had. That is why we are opening embassies and investing in the language school and why the Foreign Office is a very important part of our soft power.

NATO is based on extended deterrence. Russia has thousands of nuclear weapons and huge conventional forces. What discussions has the Prime Minister had with the United States and countries such as Poland and the Baltic states about reconsidering some of the approaches to ensure enhanced security for those countries that border Russia?

My right hon. Friend the Defence Secretary is in the United States at the moment discussing exactly those sorts of issues. As I have said, I think the most important thing is to reaffirm our NATO commitments, reassure our NATO allies and make sure that we are providing things such as aircraft to help with air patrols, so that the Russians can see that, on Latvia, Lithuania, Estonia and Poland, they are not just dealing with national forces, but international forces that are part of NATO. I do not agree with the suggestion that sending more troops to be stationed in Germany would somehow make an important statement. I think that the most important thing is the reassurance of NATO allies and a very clear message to Russia about the consequences of further action.

Does my right hon. Friend agree that there is a world of difference between the EU referendum the Conservative Government will offer in 2017 and the Crimean referendum, which has no basis in law and is totally illegitimate?

The important thing about using referendums in democratic states is to make sure that they are done on a legal, fair and constitutional basis. That is why I think the Scottish referendum is probably the best comparator to what is happening in Crimea, because there were proper discussions and negotiations between the Scottish Government and the Westminster Government and a proper agreement was put in place to have a fair, decisive and legal referendum. The referendum in Crimea was put together in a few weeks, at a time when there were troops all over Crimea and no proper electoral registration, and there was a complete mess as a result.

I warmly welcome the leadership role that the Prime Minister and our Government are playing in respect of Sri Lanka. It will be strongly welcomed by the thousands of Tamils settled in our country. The Prime Minister has himself travelled to Sri Lanka and heard the personal testimony of those who have been affected by the atrocities. The problem is that President Rajapaksa and his Government do not keep their word. If this resolution goes through and they do not co-operate, what will be the next step?

I thank the right hon. Gentleman for his remarks. I will never forget going to northern Sri Lanka and Jaffna and hearing some of that testimony for myself. The point is that we want to see proper reconciliation and a secure future for this extraordinary country, which could be a massive success story if it properly reconciles its past. The problem is that its Government are not doing enough to make that happen, and that is why the United Nations vote is so important. If the vote is positive, the human rights commissioner, Navi Pillay, can get on with setting up a proper inquiry. Far from hindering reconciliation in Sri Lanka, I think that will actually help.

I commend my right hon. Friend’s calm approach to this diplomatic crisis and his determination to achieve a diplomatic solution. Will he tell us what Russia actually thinks of the EU-Ukraine association agreement, particularly title II, article 7, which states:

“The Parties shall…promote gradual convergence in the area of foreign and security policy, including the Common Security and Defence Policy”?

I think the truth is—we saw this when the association agreement was first promoted and Yanukovych could not make up his mind about whether to sign it or not—that the Russians would rather that Ukraine does not sign the association agreement. I think it is safe to assume that, but we should be explaining to Russia that association agreements between countries that were part of the former Soviet Union and Europe are good for those countries and, over time, can be part of a better relationship between the EU and Russia. EU-Russia summits have been happening twice a year up until now, so those are good relations. Frankly, the idea that all our foreign polices should converge in terms of other issues—not least that which we are discussing today—is not something we should be frightened of.

I welcome the Prime Minister’s recognition of the problem of nuclear fissile material and the need for it to be controlled, but could he assure me that the Government will support the humanitarian effects of war conference that will be held in Austria later this year and that, at the non-proliferation treaty prep com at the end of April, the Government will resolutely work to get a middle east nuclear weapon free zone conference under way as a way of reducing and trying to prevent any nuclear proliferation in that region?

I can confirm that we will be working towards that goal and will continue the excellent work the Foreign Office does on it.

Freezing a few bank accounts may look pretty feeble, but a strategy to reduce eastern Europe’s energy dependence on Gazprom could send a much stronger and much more painful signal to Russia. In that context, are we committed not just to the military defence of Estonia, Latvia and Lithuania, but, more importantly, to their economic and political defence as well?

My hon. Friend is absolutely right. We will not reduce Europe’s energy dependence on Russia overnight. Hungary is more than 80% reliant on Russian gas and some of the Baltic states have an ever greater reliance on it. The truth is that this a long-term piece of work that involves building liquefied natural gas terminals, having reverse flows through pipelines, exploiting shale gas, including shale gas in south-eastern Europe and in the Baltic states, and building pipelines from Azerbaijan and other countries where gas can be supplied directly to Europe. All of those things will make a difference, and they will make a long-term difference to the relationship between the EU and Russia in a way that will make the EU more resilient. Although we are not reliant on Russian gas, we should be helping to push that process.

One of President Putin’s vanity projects—there are many and some of them are very expensive—is the economic forum he intends to hold from 22 to 24 May in St Petersburg. Will the Prime Minister make sure that no British officials are going to that event, and will he urge British business representatives not to attend, either?

The hon. Gentleman raises a good point. I have asked for a complete review of all the engagement between Britain and Russia in terms of trade promotion events, diplomatic events and summit-style events, including the sort of thing the hon. Gentleman has mentioned, to make sure that we are not engaging in a business-as-usual relationship. It is very important that the Russians understand that.

As mainland Europe seeks to minimise its dependence on energy from Russia, will my right hon. Friend assure the House that there will not be any unintended consequences, such as a loss of British sovereignty over energy policy?

I do not believe that would be the case. I made sure that somewhere in the EU Council conclusions it says very clearly that the energy mix that a country pursues is a matter for the country concerned. Obviously, we did not spend as much time on energy and climate change policy as we might have expected to, but I am very clear that, while it is one thing to have an EU goal for another renewable target, that should not be translated into national goals. These are important matters of domestic sovereignty and it is in our national interest to work with other European countries to make the whole of the European continent less reliant on Russian gas and have a more flexible energy market.

The nuclear security summit was timely, given the real fears of NATO members on Russian borders. The Prime Minister knows that we increase global threat when we show weakness in the face of resolve, so will he rule out any downgrading to a part-time UK deterrent in this uncertain environment?

I can certainly give the hon. Gentleman that assurance. It is very important that we maintain Britain’s nuclear deterrent as the ultimate insurance policy. All the information I have seen and all the arguments I have had lead me to believe that that means a submarine-based deterrent based on continuous at-sea presence.

Given that there is no realistic prospect of Russia returning Crimea to Ukraine, how long does my right hon. Friend envisage that the sanctions so far taken will continue, and is this the end of the G8?

Whether or not this is the end of the G8 depends on what Russia does next. The G7—the seven other countries of the G8—has now met and decided to have a G7 conference on the same day that the Sochi conference would have gone ahead. That does not signal the end of the G8 if Russia rapidly changes her approach.

On sanctions, we have to be clear that because of what has happened in Ukraine, it cannot be business as usual, and that those sanctions need to remain in place because what has happened is illegitimate. We want a talks process between Ukraine and Russia to begin in which these issues can be resolved, but there is no sign of that happening so far.

In view of the fact that there is a need to mitigate the impact of nuclear terrorism, will the Prime Minister now consider revisiting the policy of returning plutonium to Sellafield’s customers, such as Germany, Japan and Switzerland, in the light of President Obama’s declaration that nuclear terrorism is one of the greatest threats to international security?

We agree with President Obama about the importance of this issue. Indeed, when he set up the first nuclear security summit, British diplomats did an enormous amount to help to realise the progress that there has been over recent years. We have seen 12 countries worldwide removing all highly enriched uranium from their territory, and 15 metric tonnes of highly enriched uranium have been down-blended to low-enriched uranium since 2012, which is the equivalent to approximately 500 nuclear weapons, so good progress has been made. The test for what we do at Sellafield should be whether what we do will lead to a safer world in terms of nuclear resources, and we should not do things unless we have such assurances.

I welcome the Prime Minister’s support for travel bans and asset seizures as a symbolic statement, and as a vehicle for inflicting personal pain on those responsible for policy who depart from international norms. As he has referenced his work in relation to gay people in Russia, would it not also be an appropriate response by the United Kingdom and European Union to impose travel bans on the dozen or so people responsible for the promotion of the Anti-Homosexuality Act in Uganda?

We should take a robust approach in defending and promoting the values we care about wherever we engage in the world. We should not hold back from making our views clear, whether about the law on homosexuality in Uganda or the issues in Russia. On the issue of travel bans and asset freezes, they are focused on Russia and Crimea, and that is the right way to do it.

Does the Prime Minister believe that the actions taken or proposed by the EU and the US will actually stop Russian aggression? If they do not stop Russian aggression, has he a clear understanding of what steps should be taken next to stop Russia invading the rest of Ukraine?

The hon. Gentleman makes an important point. What has changed is that the European Council, which had previously resisted the idea of saying that we should prepare economic sanctions, has now agreed—all 28 countries, including those that have quite strong relations or energy relationships with Russia—to task the European Commission with preparing a range of economic sanctions to be put in place if Russia goes into eastern Ukraine. That is an important change. I am obviously at the front end of pushing harder for clarity, because the best way to ask Russia to take the right path is to be clear about the consequence of its taking the wrong path.

The Prime Minister’s friend Mrs Merkel and our nation’s very good friend Germany are dragging their feet against countering Russian aggression. I recognise the sterling work done by my right hon. Friend to date, but does he agree that history shows that short-term appeasement of dictators leads to longer-term problems, which means that we should insist on tougher sanctions on Russia and those close to Mr Putin right now?

I thank my hon. Friend for what he says. It is absolutely clear that if we do not take robust, predictable and firm long-term action, we will pay the consequences for many years to come, and not just in Europe, because other countries in the world would see the resolve of the international community and of the UN as weak and would draw the conclusions. We are working well with the Germans in trying to agree a common position. So far at European Councils, we have been able to agree some robust measures.

People remember the Prime Minister, when he was Leader of the Opposition, taking a very robust line on Russian aggression in Georgia, and they may well contrast that with the position that the EU has taken against Russian aggression in Ukraine. What does he consider to be the reasons for the different approach? Is he happy with the overall approach taken by the EU at this moment, or does he think that it should be stronger?

I have taken a robust approach against this sort of Russian action whether, in opposition, with respect to Georgia or, in government, with respect to Ukraine. What has changed is that, while I have been in government, the EU has been able to go further, not least because Britain has pushed firmly, consistently and clearly for the sort of action that is required. When we look at Georgia, we see a good example in the two frozen conflict states of South Ossetia and Abkhazia. We did not take action against Russia with respect to those areas in the way that we have with respect to Crimea.

In the past, President Putin has used his intelligence services aggressively not only to undermine his neighbours, but to suppress dissent at home and abroad. In the light of the annexation of Crimea, will my right hon. Friend look again at whether our intelligence services have the correct level of funding and capabilities required to counter Mr Putin’s FSB and to make sure that we are in a good place to resist any of the so-called consequences, as Mr Putin and his Russian friends have described them, of European sanctions?

I strongly support the work of our intelligence services. Obviously, we never comment on the specifics of their work, but I can tell my hon. Friend that they got a good outcome from spending rounds and reviews of the national security strategy in terms of ensuring that we maintain and in certain ways enhance their capabilities.

I very much welcome the Prime Minister’s expression of full support for the 40% emissions reduction target, but notwithstanding the important issue of sovereignty, the UK should really lead by example. Why will he not endorse the target of decarbonising our UK energy sector by 2030, given that a commitment to that target would give industry the certainty that it needs to invest?

I am grateful to the hon. Lady for what she says about Britain’s support for the 40% carbon reduction target. It is important to get the EU to sign up to that deal, so that the EU can provide global leadership at the Paris summit.

The reason why I do not support total decarbonisation of our energy sector—[Interruption.]—our electricity sector is that until we can prove that carbon capture and storage is a workable and deliverable technology, setting such a target could mean the closure of every gas-fired power station in the country, which is not a sensible approach. I know the green movement pushes this, but, frankly, until we have worked out carbon capture and storage properly, it would not be a sensible thing to do.

I welcome my right hon. Friend’s statement and his continued diplomatic success at EU Councils, which suggests that his leadership of the EU reform agenda is strengthening the UK’s hand, while our reliance on economic sanctions makes that drive for a more competitive Europe all the more important. I also welcome the steps to reduce our energy dependence on Russia. Does he agree that UK geopolitical energy security should now be the No. 1 feature of our energy policy for the next Parliament?

My hon. Friend makes the important point that in looking at considerations within energy policy—security of supply, making sure that there is capacity, contributing to the decline in carbon emissions, and national security—there is no doubt that the national security part of the picture for Britain and for Europe has become a much more pressing issue. We have good, diverse supplies of electricity; we are reinvesting in nuclear; we have the world’s leading offshore wind industry, which I saw for myself in Hull yesterday; but we obviously need to help Europe to diversify away from Russian gas, and we should recognise our strategic interests in helping it to do just that.

I welcome the Prime Minister’s statement and the answer that he gave earlier that related to my constituency. Away from diplomatic processes and soft power, our efforts on nuclear security must be underpinned by an effective plutonium disposition strategy. We have the potential to lead the world in that regard. To that end, will the Prime Minister commit to funding fully and commissioning the National Nuclear Laboratory, and will he commit to a timeline so that the plutonium that is stored in my constituency, which I believe is the biggest stockpile in the world, can be utilised as nuclear fuel, thereby helping us to meet our non-proliferation objectives, secure our energy supplies and fight climate change?

What I say to the hon. Gentleman, who has an important constituency interest in this matter, is that the National Security Council has met specifically to consider how to make progress on Britain’s plutonium supplies and the work that we want to see on energy generation. Perhaps I could write to him to update him on that work and on the decisions that we are taking.

In light of the recent events in Ukraine, the ongoing instability in the middle east, the significant energy price differential between the US and Europe, and the broad analysis of the latest “World Energy Outlook”, does the Prime Minister agree that one of our strategic challenges is to develop a coherent UK energy policy that concentrates primarily on how we use energy, and not on the generation of energy? Put simply, energy price is linked directly to GDP. If we use less energy, it means smaller bills for businesses and domestic users, and less dependence on the increasingly unstable wider world.

Where I absolutely agree with my hon. Friend is that we need a strategy that focuses on how we use energy, so that we have greater energy efficiency. We should have smarter grids and smart meters to ensure that households and businesses do not waste energy. We are making big technological breakthroughs on that. However, it is important that we have a diverse range of supplies, so the generation of electricity does matter. We should not be too reliant on any one fuel or any one part of the world. That is why the capacity mechanism for gas, the nuclear refreshment and renewables are important.

The Prime Minister threatens tougher measures if the Russians go into eastern Ukraine. Many of us think that those tougher measures should be introduced right now. Will he look again at targeting Putin’s inner circle? What consideration has he given to freezing the assets of and denying visas to members of the Duma who voted for military action in Ukraine? What consideration has been given to seizing the UK assets of state-owned Russian companies and the Russian central bank?

It is easier and better to do that through the European Union, with all 28 countries deciding who to designate, whose assets to freeze and whose travel to ban. I have tried to explain that the process for doing that focuses on the people who played a part in the illegitimate decision. That includes members of the Duma, some of whom have been sanctioned. I agree with the hon. Gentleman that we should take other measures in respect of what happened in Crimea. That is why the measures on goods and services that come from occupied Crimea, which America has not taken but Europe has, are significant. Finally, it is important to be clear about the next steps that we would take if Russia went into eastern Ukraine. Those steps should be reserved for if Russia goes into eastern Ukraine and should not be brought in before that happens.

I very much welcome the statement by the Prime Minister. Paragraph 23 of the conclusions of the European Council, which relates to Cyprus, states:

“The European Council supports a comprehensive and viable settlement of the Cyprus problem within the UN framework”.

What steps are we taking to resolve that problem?

We continue to talk with the Cypriot Government. I had meetings with the President of Cyprus in the UK this year and I continue to speak to him at European Council meetings. There is a talks process that has made some progress. As one of the guarantor powers, we should continue to support that process.

The level of state pensions in Crimea was just 10% of that in Russia until the Russians increased it to the same level by cutting benefits in Russia. Major construction work has also been moved out of Russia and into Crimea. Both those moves are very popular in Crimea and very unpopular in Russia, as is the fall in the rouble. Will the Prime Minister stir up further resistance to Putin in Russia by clarifying what economic sanctions there will be if further steps are taken into Ukraine, to bring him into line with international law?

I agree with the hon. Gentleman that we should aim to be clear and predictable about the sanctions so that Russia knows what will happen if eastern Ukraine is threatened in any way. We made progress on that in the European Council. I hope that we will make further progress when we meet again. It is good to try to secure the agreement of all 28 countries, because then such moves will have greater power.

As well as leading the way on EU reform, the Prime Minister has been a fantastic backer of the trade negotiations between the EU and the US. Does he agree that now, more than ever, we need to get that deal signed, sealed and delivered?

My hon. Friend is absolutely right. The trade deals that Europe has signed with the Republic of Korea and Singapore are hugely influential in European trade and are beneficial for Britain. The transatlantic trade and investment partnership between the EU and the US dwarfs all the other potential deals. Meetings have taken place in the past few days between the EU and President Obama. I hope that we can make further progress.

The Prime Minister is right that getting the EU to speak with one voice on decarbonisation going into next year’s Paris meeting is hugely important. Does he accept that it will be deeply problematic if we fail to get a deal at this point, before the make-up of the European Parliament changes and before the trade and other Commissioners change?

There will be changes in Europe and a new Commission after the European parliamentary elections. It is important for the European Council to set a clear work programme for the new Commission. The headlines that I would set for the work programme would definitely be deregulation, more reshoring, and cutting the costs and bureaucracy of Europe, but we must also ensure that Europe plays its role in getting a good outcome from the Paris talks next year.

In his measured statement, the Prime Minister reminded us of the impact on energy security of a dependence on Russian energy supplies. Does he agree that we have a duty to move as quickly as is safely possible to establish the potential of shale gas to strengthen the UK’s energy security and that of our European partners?

I really do think that my hon. Friend is right about that. We have quite a lot of shale gas deposits in the UK and shale is also available in Europe, particularly in south-eastern Europe, the Baltic states and Poland. We have 75% of the capacity of shale gas that the United States has, but whereas the US has dug 10,000 wells, we have dug closer to 100. It is not written that Europe has to have higher gas prices and energy prices than the US. If we have the political will, we can deliver this safe and secure technology for our future.

The charge levelled at President Rajapaksa that he has failed to address the issues of the past properly is frequently levelled, in slightly different circumstances, at politicians in Northern Ireland. That being the case, why is the Prime Minister being inconsistent? He steadfastly opposes the internationalisation of our internal affairs. Surely he should also oppose the internationalisation of the internal affairs of a trading partner such as Sri Lanka and urge it to sort out its own problems.

I would give two answers to that very incisive question from the hon. Gentleman. First, here in the United Kingdom, including in Northern Ireland, we have taken major steps to disinter the past and to discuss it and deal with it. The Bloody Sunday inquiry is one such example. That has not happened in Sri Lanka. Its lessons learned exercise is not going into the detail that is needed about the appalling events that happened, particularly at the end of the war. Secondly, although we guard our independence and sovereignty jealously, we did call upon friendly nations, including the United States, to help us with our peace processes. Frankly, in confronting one’s own past and one’s own problems, other countries can sometimes help. I think that Sri Lanka should take the same approach.

Institutionalised corruption is a key source of power for the Putin regime, but at the same time it is its greatest long-term weakness. What more can we do to extend visa bans and sanctions to deal not only with those implicated in the Crimean issue, but also those responsible for scandals such as the Magnitsky killing?

I do not want to say anything new about the Magnitsky case today, but I agree wholeheartedly with my hon. Friend that the scourge of corruption lies at the heart of much of the crisis in Ukraine, just as it lies at the heart of so many countries today that are not getting the economic growth, prosperity and fairness that their peoples yearn for. As we go forward in these endeavours, we should do everything that we can to help ensure a non-corrupt Government for Ukraine in the future.

I welcome the agreement of the European Council to fast-track the completion of the internal market in energy, which I am sure the Prime Minister would not refer to, although others do, as the “Europeanisation” of energy. What part do renewables play in that? The Prime Minister has gone big on shale today, but we have also heard a great announcement from Siemens about offshore wind energy development in the UK. I am sure he will want to pay tribute to the fact that that process was set in place by the Labour Government’s £60 million ports investment.

All I can say is that, three and a half years into this Government, I feel that I have lived and breathed the Siemens investment, making frequent calls and trying to unlock the investment. I am sure others have played their role in that as well.

Well, it was a lot more generous than anything my predecessor ever said about anything done by any previous Government. For once, silence. Yesterday I worked very hard with Hull city council, and local MPs. We do not have to talk too much about renewable energy today because Britain has the biggest offshore wind market anywhere in the world, and we should be proud of that. We do not have the largest shale gas market anywhere in the world; indeed, we have barely started. I give so much emphasis to shale gas because I think it can be an important part of our future, and I am sure that that will have all-party support.

The Prime Minister has set out the role that shale gas can play in UK and European energy security, but can he assure me and my constituents that we will not develop shale gas unless we are sure that it is safe, with safety enshrined in a robust regulatory framework?

I absolutely agree with my hon. Friend. I am convinced that we can develop shale gas in a way that is safe, and in a way that provides useful supplies of gas and can benefit local communities. I think we should look carefully at what has happened in the United States. The overwhelming lesson from the United States is that this can be done, and it can be a real bonus for local communities and for our country.

I thank the Prime Minister for his statement. Will he tell the House what progress has been made to address human rights and war crimes in Sri Lanka, including accountability for those who have committed murder and rape, and the issue of the disappeared? What discussions did he have with the Sri Lankan Government about the persecution of the Christian Church there, which is a big issue?

I have not had any recent discussions with the Sri Lankan Government about that issue because they were not present at the conference at The Hague. I raised Sri Lanka in the House today simply because the European Council briefly discussed it and reached conclusions that mean that every member of the Human Rights Council will vote for our motion. I raised the issue at The Hague because there were other undecided countries there that I was able to lobby, hopefully moving one or two of them into the right camp. If this happens, it will be a much better way of investigating the human rights abuses that have taken place.

As a proud Yorkshireman, I, too, welcome the huge investment by Siemens and Associated British Ports in east Yorkshire and our renewables sector. Will the Prime Minister confirm that we are talking about offshore wind investment, and that my constituents in beautiful places such as Slaithwaite do not have to worry too much about huge industrial turbines blocking their beautiful views of the Pennine landscape?

I can confirm that. Yesterday I went to see the Siemens investment, and the extraordinary scale of development, for myself. An entire port area is being cleared out and extended to take two enormous factories, including one that will make the turbine blades. The development is at a port because it is not just for the offshore wind market in the UK; there will be a real opportunity for export as well. That is what the investment is all about. It will provide 1,000 jobs, but much more than that, it will bring a whole new industry to Humberside and Hull because of the massive opportunity for the supply and component part of the industry to locate in that area.