9. What steps he is taking to encourage the Israeli authorities to stop the building of illegal settlements in the Occupied Palestinian Territories. (900346)

We regularly raise these issues with Israel, calling for a reversal of the policy of settlement expansion. I reiterated that in the House of Commons last week, and recently both the Foreign Secretary and I have made statements strongly condemning proposals for new settlement expansion in both the west bank and East Jerusalem.

Only last week, the right-wing Israeli Government announced a further expansion of the illegal settlement programme, so it is clear that whatever action the British Government are taking it is not working. Is it not therefore time that Her Majesty’s Government gave a more robust response to this problem, including by discouraging investment in and trade with the illegal settlements, and ensuring the proper labelling of imported goods so that they are designated as coming from “an illegally Occupied Palestinian Territory”?

This is a long and difficult process, as the hon. Gentleman rightly knows. We have a policy on labelling, and continued conversations will go on with the state of Israel in relation to suggestions, such as we heard last week, that new housing units should be built in East Jerusalem. This is a complex process and the UK does not believe in boycotts or sanctions, but clear labelling has been in place for some time so that consumers can take their choice.

We have contributed to a number of EU structures that have been demolished. Will my right hon. Friend ask the Government of Israel for our money back?

I think my right hon. Friend is referring to some work done by the EU. The EU has not sought compensation from the state of Israel in relation to that, and no decision has been taken on any further action.

Settlements are a barrier, but they are far from the only barrier to peace. The building blocks for the peace process are trade and economic development in the west bank; demilitarisation and democracy in Gaza; and support for co-existence projects that get Israelis and Palestinians working together, the funding for which, I am sorry to say, this Government have stopped. Will the Minister reinstate funding for co-existence projects, to build the peace process?

The hon. Gentleman understands this issue extremely well, and I agree with his analysis that this is a complex issue, where there are many different building blocks to try to revitalise the peace process, and settlements are far from the only barrier to that. Trade and investment remain important, but we will be looking further at what prospects there are for any new initiatives. I am aware of the co-existence projects that he mentions, and I will certainly be looking at that when carrying out my joint responsibilities in the Department for International Development.

We are all glad to see the Minister for the Middle East back and working on this issue again, but this is the second time in the space of a week that the Foreign Secretary has declined to speak about the middle east and devolved the job to the Minister instead—and that follows his failure even to mention Israel or Palestine in the Tory election manifesto. I simply ask the Minister: when are we going to hear the Foreign Secretary stand up and condemn the new illegal settlements?

I thank the hon. Lady for her warm welcome. I much enjoy being back in this role, no matter what is thrown at me as part of it. The Foreign Secretary strongly condemned the proposals that were announced for the west bank recently. I like to think he has confidence in his Minister for the Middle East—as he has confidence in his full ministerial team—to answer appropriate questions, although I have never known him to be shy of answering a question when necessary.